PZG Paramount Gold and Silver Corp

Paramount Gold and Silver Corp. (NYSE Amex: PZG)(TSX: PZG)(FRANKFURT: P6G)(WKN: A0HGKQ) ("Paramount") announced today new positive metallurgical results for its 100% owned San Miguel project in Mexico. The new study, conducted by McClelland Laboratories Inc., is based on eleven composite samples from 256 drill hole intercepts in the San Francisco Area of the San Miguel project. Direct agitated cyanidation tests (bottle roll) returned average recoveries of 90.1% for gold and 76.5% for silver, with low cyanide and lime consumption.

In 2010 Paramount Gold and Silver prepared a number of samples from an ongoing drilling campaign to test metallurgical recoveries on various ore types. A total of eleven composite samples of various gold and silver grades were prepared from 256 drill holes intercepts. Composites were prepared by crushing to P8075um (80% passing 75 microns). Bottle roll and flotation tests were conducted on all composites to evaluate likely recovery scenarios.

Bottle roll tests returned the best recoveries and proved to be the most cost efficient, with gold recoveries ranged from 83.3% to 95.9% and silver recoveries from 60.0 % to 89.2%. Metal recovery was very rapid through the first six hours and slower thereafter. Tests were terminated after 48 hours of leaching. Reagent consumption was low, with average sodium cyanide (NaCN) consumption of 0.13 kg per tonne of material and lime consumption of 1.35 kg per tonne of material processed.

Sulfide flotation tests on the same materials showed much lower recoveries, demonstrating that direct cyanide leaching is a more efficient and cost effective recovery process for both gold and silver.

Details of results are tabulated below and full McClelland Report can viewed at www.paramountgold.com.

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        Summary results, Agitated Cyanidation test (Bottle Roll)
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Composite
ID(i)          Au g/t  Ag g/t       Recovery%        Reagent consumption
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                 Head    Head                                 Lime Kg/mt
                Grade   Grade      Au      Ag NaCN kg/mt ore         ore
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SF-09-01        1.475   25.09    90.3    84.1           0.15         1.4
------------------------------------------------------------------------
SF-09-02        0.936    9.29    93.8    89.2 less than 0.05         1.3
------------------------------------------------------------------------
RCSF-10-001     0.848   13.51    90.7    87.6           0.15         1.6
------------------------------------------------------------------------
RCSF-10-002     0.474    4.16    85.0    76.0           0.08         1.1
------------------------------------------------------------------------
RCSF-10-004     0.924    5.00    90.4    60.0           0.07         1.5
------------------------------------------------------------------------
RCSF-10-005     2.086   52.15    94.4    75.1           0.13         1.5
------------------------------------------------------------------------
RCSF-10-006     0.808    8.77    87.1    65.8           0.07         1.5
------------------------------------------------------------------------
RCSF-10-007     1.276   24.90    93.5    73.2           0.08         1.3
------------------------------------------------------------------------
RCSF-10-008     1.611    9.67    95.9    75.9           0.07         1.4
------------------------------------------------------------------------
Hi Au           3.233   40.80    95.9    77.9           0.30         1.0
------------------------------------------------------------------------
Hi Ag, Low Au   0.162   35.20    83.3    76.4           0.23         1.3
------------------------------------------------------------------------
Average         1.258   20.78    90.9    76.5           0.13        1.35
------------------------------------------------------------------------
(i) All composite samples, except RCSF-10-007 are sulfide bearing ore.

These results indicate that even at low gold and silver grades, recoveries of sulfide bearing material are excellent with low reagent consumptions.

Christopher Crupi, CEO Paramount Gold and Silver commented: "These results are an important step towards demonstrating the economics of the San Francisco target. Having these results now should also help us to define a larger resource. Knowing that recoveries are likely to be high even on lower grade material will encourage us to lower the cut-off grade and expand the mineralized envelope that we drill and include in our resource model".

Paramount Gold and Silver continues its drilling program at San Miguel to improve the resource quality and to update resources on several of the zones. Paramount Gold also continues to test other unexplored targets within its large property position at San Miguel Project.

Bill Threlkeld, a Qualified Person under NI43-101 has reviewed the contents of this release. For more information visit www.paramountgold.com

Safe Harbor for Forward-Looking Statements:

This release and related documents may include "forward-looking statements" including, but not limited to, statements related to the interpretation of drilling results and potential mineralization, future exploration work at the San Miguel Project and the expected results of this work. Forward-looking statements are statements that are not historical fact and are subject to a variety of risks and uncertainties which could cause actual events to differ materially from those reflected in the forward-looking statements including fluctuations in the price of gold, inability to complete drill programs on time and on budget, and future financing ability. Paramount's future expectations, beliefs, goals, plans or prospects constitute forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and other applicable securities laws. Words such as "believes," "plans," "anticipates," "expects," "estimates" and similar expressions should also be considered to be forward-looking statements. There are a number of important factors that could cause actual results or events to differ materially from those indicated by such forward-looking statements, including, but not limited to: uncertainties involving interpretation of drilling results, environmental matters, lack of ability to obtain required permitting, equipment breakdown or disruptions, and the other factors described in Paramount's Annual Report on Form 10-K for the year ended June 30, 2010 and its most recent quarterly reports filed with the SEC.

Except as required by applicable law, Paramount disclaims any intention or obligation to update any forward-looking statements as a result of developments occurring after the date of this document.

Contacts: Paramount Gold and Silver Corp. Glen Van Treek VP Exploration 866-481-2233 Paramount Gold and Silver Corp. Chris Theodossiou Investor Relations 866-481-2233