12:03 EDT Thursday, May 28, 2009

VANCOUVER, BRITISH COLUMBIA--(Marketwire - May 28, 2009) - Klondike Gold Corp. (the 'Company') (TSX VENTURE:KG) is pleased to announce that joint venture partner Chalice Diamond Corp. (TSX VENTURE:COD) plans to use the proceeds from the recent exercise of warrants and sale of VTEM geophysical data to further explore a large land package in the Chapleau-Wawa district of Ontario.

Klondike Gold and Chalice Diamond jointly hold properties in the Chapleau-Wawa district that encompass gold, diamond and volcanogenic massive sulphide (VMS) targets, in addition to their respective separate mineral holdings in Canada.

Chalice Diamond received $348,040 from the recent exercise of 4,972,000 warrants from a total of 15,578,069 granted warrants that expired on May 10, 2009. These funds are in addition to the $421,908 received from the Ontario government from the recent sale of helicopter-borne VTEM system electromagnetic and magnetic data covering some non-core landholdings in the Chapleau-Wawa district.

For a map of the Chapleau-Wawa Project click on the following link:

http://www.chalicediamond.com/i/pdf/...

About Klondike Gold Corp

Klondike Gold is a large landholder in the Klondike District of the Yukon Territory, an area which produced between six and twelve million ounces of gold during its historic gold rush. The Company also holds a 50% interest with partner Chalice Diamond Corp in approximately 78,000 acres of diamond properties located in the Chapleau-Wawa region of Ontario and a number of properties in southeastern British Columbia.

Please visit the Company's website: www.klondikegoldcorp.com for more information on the diamond properties in Ontario, our holdings in the Klondike and our properties in southeastern BC.

The statements made in this Press Release may contain forward-looking statements that may involve a number of risks and uncertainties. Actual events or results could differ materially from the Company's expectations and projections.

FOR FURTHER