Aura Silver Closes Final Tranche of $3.0 Million Private Placement Financing to Fund Greyhound and Taviche

OTTAWA, ONTARIO -- (Marketwire) -- 10/26/10 -- Aura Silver Resources Inc. (TSX VENTURE: AUU) ('Aura Silver' or the 'Company') announces that it has closed the second and final tranche of its private placement financing. The second tranche comprised the issuance of a total of 4,809,645 non-flow-through units for gross proceeds of $769,543.

Including the first and second tranches, a total of 12,295,000 non-flow-through units for proceeds of $1,967,200 and 5,555,388 flow-through units (collectively the 'Units') for gross proceeds of $999,970 were issued in this offering. Union Securities Ltd. ('Union') and Dundee Securities Corp. ('Dundee') acted as agents for this financing.

Each Unit consists of either one regular common share or one flow-through common share and one non-flow-through common share purchase warrant ('Warrant') exercisable at a price of $0.25 (US$0.24) per share for a 24 month period from the closing. Additionally, Warrants are callable during the 24 month period, at the option of the Company, should the Company's common shares close above $0.50 for twenty consecutive trading days on the TSX Venture Exchange. Subscribers will be notified of the call provision being triggered and will have a 30 day period to exercise the Warrants.

In consideration for their services with respect to the offering, the agents were paid an 8% commission of $175,810 plus a total of 1,304,073 non-transferrable agent compensation options to acquire non-flow-through units. The agents' compensation options are exercisable for a period of 24 months from the closings at a price of $0.16 per unit. Union has also been reimbursed for legal costs of the offering.

The Company's President and CEO purchased 133,855 non-flow-through units in this private placement. All securities issued in the offering are subject to a four month hold period from the closings expiring on February 16, 2011 or February 27, 2011. This private placement is subject to final acceptance of the TSX Venture Exchange.

Aura Silver intends to use the proceeds of the flow-through offering to fund an extended drilling and prospecting program and related exploration costs for its 100% owned Greyhound, Nunavut project. The Company is currently undertaking a geophysics program at Greyhound which is designed to determine drill targets on a previously discovered gold and silver zone. As previously reported, this zone contains gold and silver-enriched rock samples, including seven samples that contain an average grade of 14.8 g/t Au (range from 0.3 to 28.8 g/t) and in the same area an average grade of 1,472 g/t Ag (range from 21-5,380 g/t). The flow-through share proceeds will be used to incur these Canadian exploration expenses prior to December 31, 2011 at the latest. The Company intends to renounce the qualifying expenditures to subscribers for the year ended December 31, 2010.

The non-flow-through proceeds will be used to conduct additional drilling programs at the Company's highly prospective Higo Blanco project in Oaxaca, Mexico. This project has yielded prolific mineralization with silver equivalent grades up to 303.9 g/t over 36.6 meters and gold grades of up to 0.93 g/t over 23.2 meters and 2.05 g/t over 8.4 meters (see 'Aura Silver Gold and Silver Zones at Taviche' on the Company's web site at Investors/Presentations). Further, Aura Silver will undertake further reconnaissance of its West Taviche property which surrounds and land-locks the Fortuna Silver's San Jose mine. Company geologists believe that the vein system currently being developed for production by San Jose runs both north and south onto Aura Silver's property. Non-flow-through proceeds will also be used for working capital and general corporate requirements.

About Aura Silver

Aura Silver is a TSX Venture listed company engaged in the acquisition, exploration and development of precious metal prospects in Canada (100% owned Greyhound project) and in Oaxaca, Mexico. Aura Silver has 76,952,790 common shares outstanding, including those issued in this financing.

FORWARD-LOOKING STATEMENTS

This press release may contain forward looking statements that are made as of the date hereof and are based on current expectations, forecasts and assumptions which involve risks and uncertainties associated with our business including the uncertainty as to whether further exploration will result in the target(s) being delineated as a mineral resource, capital expenditures, operating costs, mineral resources, recovery rates, grades and prices, estimated goals, expansion and growth of the business and operations, the private placement financing activities of the Company, plans and references to the Company's future successes with its business and the economic environment in which the business operates. All such statements are made pursuant to the 'safe harbour' provisions of, and are intended to be forward-looking statements under, applicable Canadian securities legislation. Any statements contained herein that are statements of historical facts may be deemed to be forward-looking statements. By their nature, forward-looking statements require us to make assumptions and are subject to inherent risks and uncertainties. We caution readers of this news release not to place undue reliance on our forward-looking statements as a number of factors could cause actual results or conditions to differ materially from current expectations. Please refer to the risks set forth in the Company's most recent annual MD&A and the Company's continuous disclosure documents that can be found on SEDAR at www.sedar.com. Aura Silver does not intend, and disclaims any obligation, except as required by law, to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contacts:

Aura Silver Resources Inc.

Robert Boaz

President and CEO

905-403-8010
boaz@aurasilver.com
www.aurasilver.com