Magino Resource Expansion Drilling Continues: 161 metres grading 1.35 gpt Gold and 36 metres Grading 2.64 gpt Gold

Prodigy Gold Incorporated (PDG: TSX.V) is pleased to announce additional
results from its in-fill and resource expansion drilling program at its
100% owned Magino mine gold project in Ontario. The drill results
reported here come from two portions of the Magino gold deposit: the
southwest corner of the proposed open pit and the central area. Drill
hole MA11-105 intercepted a thick zone of good grade gold mineralization
in the southwest area: 161.1 metres grading 1.35 gpt gold. In the
central area, drill hole MA11-102 cut 36.3 metres of higher grade gold:
2.64 gpt. Drill hole MA11-098, located northeast of hole -102,
intercepted 129.0 metres grading 1.01 gpt gold. These drill results,
combined with previously announced results from the in-fill drilling
program, are fulfilling the objective for the program: Expand gold
resources and reduce the strip ratio within the proposed open pit. These
data will be utilized in the upcoming update to the Magino gold resource
estimate expected in late September. Brian J. Maher, President and CEO
of Prodigy Gold comments: 'The results to date from our in-fill drilling
program continue to be very encouraging. We are on track to release an
updated resource estimate in late September followed by a revised PEA.
The nearly completed in-fill drilling program, combined with additional
metallurgical studies and the recently reported geotechnical data
allowing for steeper pit walls should significantly improve project
economics.' A drill hole location map and complete table of drill
results are shown below.

Note: NSV = no significant values. All assays are capped at 40
gpt gold.

To view the map associated with this release, please click on the
following link:

http://www.usetdas.com/pr/prodigymap08302011.jpg

Additional in-fill drilling will continue at Magino for several weeks.
When completed, the drill rigs will then concentrate on exploration
targets near the Magino deposit and on higher grade, deeper extensions
to the Magino gold system.

About Prodigy Gold:Prodigy Gold Inc. (PDG: TSX.V)
is currently evaluating the development of the Magino mine gold project
in Ontario as an open-pit mining opportunity with the potential for
deeper, higher grade gold production. The Magino project contains
Indicated gold resources of 1,924,200 ounces grading 1.16 gpt gold (51.6
million tonnes), and 587,100 ounces of Inferred gold resources grading
1.04 gpt gold (17.5 million tonnes). A Preliminary Economic Assessment
(PEA) of the project shows a pre-tax NPV of $351million and an IRR of
49% using a 5% discount rate (available on SEDAR or Prodigy's web site).
The proposed operation would have an average annual gold output of over
166,000 ounces a year during a nine year project life. Total gold
production is estimated to be 1.50 million ounces at cash costs of
approximately US$496 (Cdn$521) per ounce. Please note: mineral resources
that are not mineral reserves do not have demonstrated economic
viability.

A full feasibility study for the proposed open pit mining project at
Magino is scheduled for early 2012. Bringing the Magino mine project
through the feasibility process and towards production, coupled with the
exploration potential of our Beardmore-Geraldton exploration properties,
are the catalysts to growing Prodigy Gold and building substantial value
for Prodigy shareholders: Today's Discovery, Tomorrow's Future.

All scientific and technical information for the Magino project has been
reviewed and approved by Tom Pollock, P.Geo., Prodigy Gold′s Vice
President ? Exploration, who is a qualified person under the definitions
established by National Instrument 43-101. Drill core at Magino is
boxed, covered, and sealed at the drill rig and moved to the Prodigy
logging and sample preparation facilities by Prodigy Gold personnel. The
core is then split down the centre using a typical table fed circular
rock saw normally at one metre intervals. One half of the core is sent
for assay to ALS Chemex, 2090 Riverside Dr., Timmins, ON, P4R 0A2, while
the other half is returned to the core box and stored at Prodigy′s
sampling facility in a secure, fenced off, area. Prodigy QA/QC
procedures include the regular use of blanks, standards and duplicate
samples in addition to sending 10% of the samples off to a second lab
for check assays. Samples assaying > 3.0 gpt gold are automatically
re-assayed by the metallic screen method. Gold assays greater than 40
gpt are capped at 40 gpt when calculating composite intervals in drill
holes. Drill holes are directed as much as possible perpendicular to the
strike and dip of the mineralization at Magino. As a rough estimate the
true thickness of the above intercepts is approximately 76%.

On behalf of the Board of Directors

Brian J. Maher

President
and Chief Executive Officer

This news release includes certain forward-looking statements or
information.All statements other than statements of historical
fact included in this release, including, without limitation, statements
relating to the potential mineralization and geological merits of the
Magino mineproperty and other future plans, objectives or
expectations of Prodigy Gold Incorporated (the 'Company') are
forward-looking statements that involve various risks and uncertainties.There can be no assurance that such statements will prove to be
accurate and actual results and future events could differ materially
from those anticipated in such statements.Important factors that
could cause actual results to differ materially from the Company's plans
or expectations include risks relating to the actual results of current
exploration activities, fluctuating gold prices, possibility of
equipment breakdowns and delays, exploration cost overruns, availability
of capital and financing, general economic, market or business
conditions, regulatory changes, timeliness of government or regulatory
approvals and other risks detailed herein and from time to time in the
filings made by the Company with securities regulators.The
Company expressly disclaims 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 otherwise required by
applicable securities legislation. NeitherTSX 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.

Prodigy Gold Incorporated

Brian J. Maher, 1-604-688-9006

Fax:
1-604-688-9029

ir@prodigygold.com

www.prodigygold.com