Yellowhead Mining Inc. Reports Financial and Operating Results to July 31, 2011

VANCOUVER, Sept. 23, 2011 - Yellowhead Mining Inc. (“Yellowhead“ or the “Company“) (TSXV: YMI) is pleased to report the results of its three and nine months of operations in the period ending July 31, 2011.

For the full quarterly Financial Statements and Management Discussion and Analysis, please visit SEDAR or the Company's web site, www.yellowheadmining.com.


Highlights and Outlook:

- The Feasibility Study for a 70,000 tpd copper mine is on target for completion in Q1 2012;

- In support of the Feasibility Study, the Company has completed a total of 12,468 metres of drilling for the nine months including:

- - 1,888 metres of geotechnical drilling for pit slope analysis;
351 metres of geotechnical drilling for tailings management facility, waste dump and foundation design; and

- - 4,090 metres of infill resource drilling to improve confidence within the pit limit.

- Drilling for pit slope design was substantially completed by the end of July. A further 1,450 metres of geotechnical drilling for facilities design remained to be completed together with 3,500 metres of infill resource drilling. Assay results are expected by mid-October.

- Additional drilling to be completed includes:

- - 1,800 metres of condemnation drilling for the plant site, waste dumps and tailings management facility; and

- - 8,000 metres of resource expansion/step out drilling.

- Metallurgical test work is well underway at G&T's laboratory in Kamloops and comminution/grinding tests by FLSmidth in their Bethlehem, PA facility has been completed.

- Metallurgical test work is anticipated to be complete by the end of October.

- The Company had $22.1 million in working capital as at the end of July. This is expected to be sufficient to complete the feasibility study, permitting and commence detailed design and project financing activities.

- During the quarter, $3.8 million was capitalized on exploration and feasibility study related work.

- In order to finance the development of its 100%-owned Harper Creek project, the Company is exploring financing options, including but not limited to: strategic investors and/or partnerships, project and equipment financing and off-take agreements.


Summary of Key Financial Highlights

Yellowhead has no revenue from operations. Results can fluctuate significantly from period to period due to the level of engineering and environmental study effort and resource drilling.

                                               3 months            9 months
                                         2011        2010       2011        2010

Resource Property Expenditures 	$ 3,821,626   $ 49,258   $ 6,617,520   $ 77,191
These sums, as noted above, have been capitalized.

The Company's operating costs increased significantly during the three and nine months of 2011 compared to the same periods a year earlier.

The Company was able to resume the development of its Harper Creek project with the completion of the Preliminary Economic Assessment in March, followed by the initiation of the Feasibility Study in April, 2011 with a scheduled completion date of March 31, 2012. As a consequence of the significantly expanded project development programs, the Company's expenditures for General & Administrative costs, consulting fees and expenses, and investor relations activities, have increased significantly.

To attract and retain good people in management and executive roles as well as on the board of directors and its advisors, the granting of new stock options resulted in a significant increase in the non-cash expense for Stock Based Compensation.

3 months
9 months
2011
2010
2011
2010

Comprehensive loss for the period
$ 1,367,722
$ 615,298
$ 3.827,252
$ 909,644

Non Cash charges included

Stock Based Compensation
$ 430,039
$ 509.080
$ 1,873,291
$ 509,080

Amortization
$ 19,848
$ 18,685
$ 56,311
$ 56,197
Net Operating Cash Cost
$ 917,835
$ 87,533
$ 1,897,650
$ 344,367

The funding of the resource property interests and the expanded operating expenditures was made possible by the success of two Private Placements, one which concluded in November, 2010 (the “November Private Placement“ and the second which concluded in April, 2011 (the “April Private Placement“).

These private placements, and the amalgamation with the Capital Pool company, Four Points Capital Corporation, accounted for a significant increase in expenses for professional fees.


Working Capital

The Company had working capital of $22,128,393 as at July 31, 2011 compared to working capital of $4,925,431 as at October 31, 2010.

The Company's focus for the remainder of the year, and going forward, is expediting the development of the Project. Major activities include completion of the Feasibility Study, submittal of the Environmental Assessment report, and project financing.

The Company believes that it has sufficient funds on hand to complete the definitive Feasibility Study and to advance through the permitting process.


About Yellowhead Mining Inc. and the Harper Creek Project

The Harper Creek Project is a copper-gold-silver volcanogenic sulphide deposit with a measured and indicated resource of 563.2 million tonnes grading 0.31% Cu (3.6 billion pounds of copper) plus 0.032 g/t gold and 1.08 g/t silver, plus an inferred resource of 117 million tonnes grading 0.29% Cu (0.7 billion pounds of copper). The Harper Creek Project is located in south-central British Columbia, approximately 150 kilometers by highway north of Kamloops.

Yellowhead has a 100% interest in the Harper Creek development project*. A Preliminary Economic Assessment Report (``PEA``), which demonstrated the technical and economic viability of the Harper Creek Project, was completed at the end of March and filed on SEDAR on April 1, 2011 and can be viewed on www.sedar.com. The PEA demonstrated a 22 year project life at a milling rate of 70,000 tonnes per day, a planned production of 149 million lbs. copper in concentrate per annum for years one to eight, a life-of-mine stripping ratio 0.88:1, an IRR of 19.8% with a base case copper price of US$2.66/lb., an NPV8 of US$598 million and a capital cost of C$759 million in Q4 2010 dollars, including contingency with a 4 year payback.

* (Subject to the payment of a 3% NSR royalty capped at $2.5 million, adjusted for inflation and an additional 2.5% NSR royalty on an estimated 3.3 million tonnes of ore which is expected to be mined beginning in year nine within the NI 43-101 resource.)



FORWARD-LOOKING STATEMENTS AND CAUTIONARY DISCLAIMER

Except for statements of historical fact, this news release contains certain “forward-looking information“ within the meaning of applicable securities laws. Forward-looking information is frequently characterized by words such as “plan“, “expect“, “project“, “intend“, “believe“, “anticipate“, “estimate“ and other similar words, or statements that certain events or conditions “may“ or “will“ occur. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking statements, including, among others, the accuracy of mineral grades and related assumptions, inherent operating risks, planned expenditures, proposed exploration and development at the Harper Creek Project, operating and economic aspects of the Harper Creek Project, as well as those risk factors identified in the Company's Annual Information Form filed under the Company's SEDAR profile. Yellowhead undertakes no obligation to update forward-looking information if circumstances or management's estimates or opinions should change except as required by law. The reader is cautioned not to place undue reliance on forward-looking statements. More detailed information about potential factors that could affect financial results is included in the documents filed from time to time with the Canadian securities regulatory authorities by Yellowhead.

This news release includes disclosure of scientific and technical information, as well as information in relation to the calculation of re-sources, with respect to the Harper Creek Project. Yellowhead's disclosure of mineral resource information is governed by National Instrument 43-101 - Standards of Disclosure for Mineral Projects (“NI 43-101“) under the guidelines set out in the Canadian Institute of Mining, Metallurgy and Petroleum (the “CIM“) Standards on Mineral Resources and Mineral Reserves, adopted by the CIM Council, as may be amended from time to time by the CIM (“CIM Standards“). There can be no assurance that mineral resources will ultimately be converted into mineral reserves. Mineral resources are not mineral reserves and do not have demonstrated economic viability. This news release uses the terms “measured“, “indicated“ and “inferred“ resources. U.S. persons are advised that while such terms are recognized and required by Canadian regulations, the U.S. Securities and Exchange Commission does not recognize them. “Inferred Resources“ have a great amount of uncertainty as to their existence and as to their economic and legal feasibility. It cannot be assumed that all or any part of an inferred resources will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred resources may not form the basis of feasibility or other economic studies. U.S. persons are cautioned not to assume that all or any part of measured or indicated resources will ever be converted into reserves. U.S. persons are also cautioned not to assume that all or any part of an inferred mineral resource exists, or is economically or legally mineable.

Neither the TSX Venture Exchange Inc. 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.



For further information:

Yellowhead Mining Inc.
Ronald Handford, Executive Vice President, Corporate Development:
rhandford@yellowheadmining.com
Tel. 604.681.1709 ext. 204

Website: www.yellowheadmining.com
Twitter: http://twitter.com/YMI_Mining

Renmark Financial Communications Inc.
Barry Mire: bmire@renmarkfinancial.com
Maurice Dagenais: mdagenais@renmarkfinancial.com
Tel.: (514) 939-3989 or (416) 644-2020
www.renmarkfinancial.com