Evolving Gold Announces Completion of Dividend-in-Kind of Prosperity Goldfields

VANCOUVER, March 3 /PRNewswire-FirstCall/ -- Evolving Gold Corp. (TSX: EVG) (FSE: EV7) ('Evolving Gold') announced today that it had completed its previously announced special dividend-in-kind of Prosperity Goldfields Corp. ('Prosperity'). Prosperity holds an option to acquire the mineral claims forming the Kiyuk Lake gold property in southern Nunavut. Upon receipt of shares of Prosperity ('Prosperity Shares') for the reimbursement of transaction costs, Evolving Gold expects to hold approximately 48.5% of the outstanding Prosperity Shares.

Under the dividend-in-kind, subject to applicable securities laws, each holder of Evolving Gold shares on the record date of February 16, 2011 received one Prosperity Share for every ten Evolving Gold shares held. The number of Prosperity Shares issued was rounded down to the nearest whole number of Prosperity Shares. The TSX Venture Exchange ('TSXV') has approved the listing of the Prosperity Shares on the TSXV under the symbol 'PPG'.

Evolving Gold believes that the fair market value of the Prosperity Shares distributed to be $0.15 per Prosperity Share. Prosperity's prospectus dated February 2, 2011 (which is available on SEDAR at http://www.sedar.com/ under Prosperity's profile) contains important information relating to the transaction described in this news release. Evolving Gold's and Prosperity's shareholders are urged to read the prospectus. As described in further detail in the prospectus, no Prosperity Shares were issued to shareholders who are (or are deemed to be) non-residents of Canada. Rather, such Prosperity Shares have been or will be delivered to a trustee for sale in the open market, and the net proceeds will be delivered to non-resident shareholders, net of any withholding taxes.

This news release does not constitute an offer to sell or the solicitation of an offer to buy securities in any jurisdiction. The Prosperity Shares distributed have not been approved or disapproved by any Canadian or U.S. regulatory authority nor has any such authority passed upon the accuracy or adequacy of the preliminary prospectus. The Prosperity Shares will not be distributed in any state or jurisdiction, including the United States, if an offer, a solicitation of an offer to buy, or a sale of the Prosperity Shares would be unlawful absent registration or qualification under the securities laws of any such state or jurisdiction. Any public offering of securities to be made in the United States can only be made pursuant to an effective registration statement. The Prosperity Shares have not been registered under the United States Securities Act of 1933, as amended (the 'U.S. Securities Act'), or any state securities laws, and Evolving Gold has no intention of filing such a registration statement in connection with the dividend-in-kind of the Prosperity Shares. Accordingly, shareholders of Evolving Gold who are resident in the United States or who are U.S. persons (as defined in Rule 902 of Regulation S under the U.S. Securities Act) will not be entitled to participate in the dividend-in-kind of the Prosperity Shares, except as set out above and in the prospectus of Prosperity.

Eligible Dividend Designation

For purposes of the enhanced dividend tax credit rules contained in the Income Tax Act (Canada) and any corresponding provincial and territorial tax legislation, all dividends and deemed dividends paid by Evolving Gold on its shares after March 1, 2011 are designated as 'eligible dividends' unless indicated otherwise. For greater certainty, dividends so designated include the dividend-in-kind of Prosperity Shares as described in this news release.

About Evolving Gold Corp.

Evolving Gold is focused on exploring its gold discovery at Rattlesnake Hills, Wyoming, an alkalic gold system, similar to the Cripple Creek gold district in Colorado, and on four gold properties in and adjacent to the productive Carlin district of northern Nevada, two of which are 100% controlled by Evolving Gold.

For more information about Evolving Gold please visit: http://www.evolvinggold.com/. To receive regular updates or to receive a follow-up call from Investor Relations please sign up at: http://evolvinggold.com/sign-up.php.

  On Behalf of the Board of Directors EVOLVING GOLD CORP.
  'Robert Barker'

  Robert Barker CEO and Director
  About Prosperity Goldfields Corp.

Prosperity's principal business is the acquisition, exploration and development of resource properties for the mining of precious metals. Prosperity acquired the option to acquire the mineral claims comprising the 'Kiyuk Property' near Nueltin Lake in Nunavut. Prosperity's principal objective is to explore the Kiyuk Property.

Officers and Directors of Prosperity: R. Bruce Duncan, CEO and Director; R. Stuart (Tookie) Angus, Director; Robert Barker, Director; and Olga Nikitovic, CFO and Corporate Secretary.

For more information about Prosperity please visit: http://www.prosperitygoldfields.com/.

  On Behalf of the Board of Directors PROSPERITY GOLDFIELDS CORP.
  'R. Bruce Duncan'

  R. Bruce Duncan CEO and Director

FORWARD-LOOKING STATEMENTS: This press release contains forward-looking statements which address future events and conditions, which are subject to various risks and uncertainties. Such statements include those related to the sale of Prosperity Shares otherwise issuable to non-resident shareholders of Evolving Gold. Evolving Gold's or Prosperity's actual results and financial position could differ materially from those anticipated in such forward-looking statements as a result of numerous factors, some of which may be beyond the Evolving Gold's or Prosperity's control. These factors include: results of exploration activities and development of mineral properties; fluctuations in the marketplace for the sale of minerals; the inability to implement corporate strategies; the ability to obtain financing; currency fluctuations; general market and industry conditions; logistical factors involved in the payment of the Prosperity Shares, and other risks disclosed in Evolving Gold's or Prosperity's filings with Canadian Securities Regulators.

Forward-looking statements are based on the expectations and opinions of the Evolving Gold's or Prosperity's management on the date the statements are made. The assumptions used in the preparation of such statements, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements. Such assumptions include assumptions related to sale of non-resident shares. Evolving Gold and Prosperity expressly disclaim any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by law.

Evolving Gold Corporation

CONTACT:

FOR MORE INFORMATION REGARDING EVOLVING GOLD, PLEASE CONTACT:

Investor Relations:

Graham Johnstone

Tel: 778-331-2023

info@evolvinggold.com

FOR MORE INFORMATION REGARDING PROSPERITY GOLDFIELDS, PLEASE CONTACT:

R. Bruce Duncan

Tel: 905 813-8408

rbduncan@sympatico.ca