Increases Private Placement

FOR IMMEDIATE RELEASE TSX-V: KG January 5, 2010 www.klondikegoldcorp.com KLONDIKE GOLD CORP.

INCREASES PRIVATE PLACEMENT

VANCOUVER, BC— Klondike Gold Corp. (the “Company”) is pleased to announce, subject to regulatory approval, that it has increased the private placement announced November 24, 2009, from 20,000,000 units to 26,500,000 units.

The financing consists of flow-through and non flow through units priced at $0.05 per unit. Each of the units consists of one flow-through or non-flow-through common share and one non-flow-through, non-transferable share purchase warrant entitling the holder to purchase one additional common share for four years at a price of $0.10 per share in the first two years, $0.15 per share in the third year and $0.20 per share in the fourth year. In accordance with Exchange policies, finders' fees may be paid on a portion of the funds raised.

Proceeds from the private placement will be used for exploration expenditures on the Company’s British Columbia and Ontario properties and general working capital.

About Klondike Gold Corp

Klondike Gold is a large landholder in southeastern British Columbia as well as 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.

For further information contact: Alan Campbell or Kevin Hull, Investor Relations

Hughes Exploration Group

Phone: (604) 685-2222 Email: [email protected]

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 TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this news release.

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.