Klondike Star Advances Indian River Gold Project towards Mine Decision

Hans Boge, P.Eng., President, Klondike Star Mineral Corporation
(OTCBB:KDSM) is pleased to report substantive progress on regulatory
approvals, current extensive drilling and test mining program,
delineation of probable mineral reserves, and business planning for a
mine development decision by the Board of Directors.

Following regulatory and public assessment under the Yukon
Environmental and Socio-Economic Act, the Yukon government Department
of Energy, Mines and Resources has formally authorized the development
and operation of an Indian River placer mine by Klondike Star. This
approval provides the direction to regulatory agencies for the
detailed water and mining land use permits expected to be issued in
the near future.

Following two successive winter exploration drilling programs,
Klondike Star completed a third winter drilling program in March 2007
and mounted a major auger drilling initiative after spring break-up in
May. This accelerated effort to delineate mineralized areas and assess
probable reserves. Drill lines were completed at 1000 foot intervals
with holes 100 feet apart along the drill lines spanning the complete
width of the initial target zone.

As of late July, a cumulative total of 551 holes 5,051
meters/16,565 feet had been drilled on the property and gold recovery
determined. Between November 2006 and July 2007, 277 holes were
completed totaling 1814 meters/5945 feet. Gold was recovered from
close to 100% of the holes continuing the pattern established with
previous drilling results. The drilling program has since shifted to
infill drilling with drill lines at 500 foot intervals to facilitate
detailed mine planning and increase confidence in the assessment of
whether there may be probable mineral reserves.

To further calibrate drilling results, test mining operations
started in 2006 using an industry-standard 5' trommel. One test site
was completed in 2006 totaling 7249 cubic meters of material with
positive results. As of August, test mining is progressing on two more
representative sites. Results are expected to be available for release
in September.

Hans Boge, P.Eng., Klondike Star President stated, "The receipt of
an authorization to mine from the Government of Yukon, following the
environmental and socio-economic assessment by an independent agency,
is a major step forward. Along with the forthcoming report on probable
mineral reserves, this allows the company to finalize plans for a
potential mine on its Indian River property."

A comprehensive business plan based on a 10-year minimum mine-life
is nearing completion. It will comply with the U.S. Securities and
Exchange Commission requirements for assessment and reporting of
mineral reserves. The plan providing the information necessary for a
mine development decision is expected to be considered by the Board of
Directors within 45 days. Subject to financing, this would allow for
production to commence as early as 2008.

About the Indian River Gold Project

The Indian River property consists of 223 placer bench claims and
3 leases totaling about 21.1 km2/8.2 mi2 located in a wide, shallow
valley about 40 kilometers from Dawson City, Yukon in the heart of the
Klondike gold-producing region. Klondike Star holds 100% ownership,
with exception of a 49% interest in a small group of claims. The
property has never been mined using modern recovery methods.

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The statements in the press release that relate to the company's
expectations with regard to the future impact on the company's results
from new products or actions in development are forward-looking
statements, within the meaning of the Private Securities Litigation
Reform Act of 1995. The statements in this document may also contain
"forward-looking statements" within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934. Since this information may contain statements that involve
risk and uncertainties and are subject to change at any time, the
company's actual results may differ materially from expected results.