North American Palladium Ltd.
TSX : PDL
TSX : PDL.WT
NYSE Amex : PAL
NYSE Amex : PAL.WS

North American Palladium Ltd.

September 17, 2009 19:00 ET

North American Palladium's Renewed Commitment to Exploration Delivers Results

Figures and tables referred to herein are available on the Company's website: www.nap.com.

TORONTO, ONTARIO--(Marketwire - Sept. 17, 2009) - The extensive ongoing exploration program of North American Palladium Ltd. ("NAP" or the "Company") (TSX:PDL)(TSX:PDL.WT)(NYSE Amex:PAL)(NYSE Amex:PAL.WS) at its 100% owned Lac des Iles mine (LDI) near Thunder Bay, Ontario has yielded exciting drill results in three different locations on the property:

- Offset Zone:

-- Assay results have grades similar to those in the Roby underground mine

-- Infill drilling has extended the Cowboy Zone

- New zone:

-- Drilling in a mineralized footwall to the Offset Zone has encountered a new mineralized zone called the Outlaw Zone

- West Pit:

-- Favourable assay results from surface drilling provide strong encouragement for follow-up exploration drilling and the consideration of open pit mining scenarios

"We are encouraged by the Offset Zone infill results. The grades achieved give us confidence that the Offset Zone will have grades similar to those in the nearby Roby underground mine, which average 7.61 g/t of palladium plus by-product metals," said William J. Biggar, NAP's President and Chief Executive Officer. "We are also delighted by the West Pit drill results, because of the grades achieved and the close proximity to our current open pit mine. Not only do we have the prospect of another open pit at LDI, but with the new Outlaw Zone we expect to continue to increase our palladium resources."

Offset Zone

Located 250 metres to the west of the Roby underground mine (Figure 2), the Offset Zone is considered to be the fault displaced extension of the Roby Zone. The 2009 drill program was planned to increase the tonnage and grade of the mineral resource in the upper part of the Offset Zone, upgrade resources from inferred to indicated, and discover new resources. Phase 1 of the drill program was completed in June 2009 and consists of 38 infill holes for 18,500 metres in the upper south quadrant (Figures 3, 5). The program decreased the drill hole spacing to 30 metres. Highlights from Phase 1 drilling (Table 2) include:

1) 5 m @ 16.9 g/t palladium (Pd) in hole 09-120;

2) 17 m @ 6.13 g/t Pd in hole 09-117; and

3) 7 m @ 7.06 g/t Pd in hole 09-201.

Phase 2 of the Offset Zone drill program commenced in mid-July 2009 and is scheduled for completion by December 31. The program plan consists of 35 infill drill holes for 15,000 metres in the upper north quadrant (Figures 3, 5) and four exploration holes farther to the north and south, for a total of 18,000 metres of drilling. The infill drilling is planned to decrease the drill hole spacing to 30 metres in this part of the Offset Zone. To date 13 of the infill holes have been drilled for a total of 5000 metres, which means that one-third of the infill drilling has been completed. Full preliminary assay results are available for eight of the drill holes and partial preliminary assay results are available for three more holes.

Highlights of the composited preliminary assay results include (Table 3):

1) 28 m @ 9.18 g/t Pd in hole 09-405;

2) 16 m @ 9.68 g/t Pd in hole 09-505; and

3) 6 m @ 9.15 g/t Pd in hole 09-503.

This high part of the upper north quadrant of the Offset Zone benefits from close proximity to the Roby underground mine development (Figure 3).

Cowboy Zone

In addition to infill drilling of the Offset Zone, Phase 2 is also expanding the lateral and vertical limits of the recently discovered Cowboy Zone (see news release dated June 25, 2009) and further established its orientation and geometry. With assay results from only the first 11 of 35 planned holes, the Phase 2 drilling to date has extended the limit of the Cowboy Zone 180 m farther to the north and 50 m farther down dip (Figure 4). These assay results are higher than those returned for the Phase 1 drilling. Phase 2 drilling continues and an initial mineral resource estimate for the Cowboy Zone is planned for completion in the fourth quarter of 2009. Highlights of the composited preliminary assay results include (Table 3):

1) 5 m @ 7.06 g/t Pd in hole 09-402;

2) 5 m @ 6.71 g/t Pd in hole 09-403; and

3) 8 m @ 5.29 g/t Pd in hole 09-503.

New Zone: Outlaw Zone

A 750-metre long underground exploration hole was designed to test the contact of the favourable LDI intrusion and the unmineralized country rock on section 502N. This drill hole, 09-114 (Table 4), did not reach the contact due to drill rig limitations. It did, however, intersect a significant interval of PGE mineralization within the intrusion, to the west of the Offset Zone and the Cowboy Zone (Figure 6). The composited assay interval for the intersection is 22 m @ 3.26 g/t Pd from 579 m down hole, which includes 5 m @ 5.94 g/t Pd. In cross sections, this intersection can be connected to similar intersections in holes 09-105 and 09-106 drilled 30 m to the west on section 503N (Table 4; Figure 6). Called the Outlaw Zone, this new zone of mineralization is hosted by gabbro, like the Cowboy Zone. Future drill programs will be designed to explore the lateral and vertical limits of the Outlaw Zone, and to establish its orientation, geometry and internal continuity. Nevertheless, it is apparent from these results that PGE mineralization at LDI remains open to the west.

West Pit

The surface drill program in the West Pit area of the LDI mine property (Figure 7) was planned to follow up on historic and previous drill results and discover new mineralized zones adjacent to the open pit mine. Two targets were generated from the results of previous drill programs (eg. 15 m @ 4.9 g/t Pd from 18 m down hole in hole 00-083 and 74 m @ 2.6 g/t from 101 m down hole in hole 00-130). Fifteen holes were drilled from within 150 metres of the west wall of the open pit. They were drilled perpendicular (N-S) to all the previous and historic holes (E-W) drilled in the West Pit area.

Assays results are presently available for nine of the West Pit holes and partial assays for a tenth hole (Table 5). The best composited assay intervals are for target 507N POD:

1) 28 m @ 3.02 g/t Pd from 23 m down hole in hole 09-077, including:

12 m @ 4.39 g/t Pd from 24 m down hole;

2) 24 m @ 3.45 g/t Pd from 175 m down hole in hole 09-071, including:

5 m @ 5.66 g/t Pd from 181 m down hole; and,

7 m @ 4.76 g/t Pd from 191 m down hole.

These assay results and the close proximity of the PGE mineralized intersections to the current LDI open pit mine (which had an average grade of 1.8 g/t Pd) provides strong encouragement for follow-up exploration drilling of these two targets and others and consideration of possible open pit mining scenarios.

Synopsis

The underground and surface drill results highlight the significant exploration potential of the LDI property, particularly around the existing mine. High potential exists for additional mineralized zones like the Cowboy and Outlaw zones farther west within the LDI intrusion. Furthermore, the drill intersections at West Pit indicate that there is high potential for the discovery of zones with different orientations and styles of mineralization around the existing open pit mine.

Quality Assurance and Quality Control, Qualified Person

The assay analyses performed during this drilling campaign was subject to a formal quality assurance and quality control (QAQC) program. Diamond drill core is logged and sampled on site with sample transport by the Company to Activation Laboratories Ltd. (Thunder Bay and Ancaster), an independent accredited laboratory, for assay analysis. Check assay analyses have been carried out by SGS Minerals Services (Toronto), a laboratory that is also independent of the Company. Internal check assays have been completed for the assay results of Phase 1 and West Pit, and are in progress for Phase 2.

The drill programs were designed and executed by the Company's exploration team based in Thunder Bay, under the supervision of Dr. Bill Stone, P.Geo, NAP's Vice President, Exploration. Dr. Stone is a Qualified Person under NI43-101 and is responsible for the contents of this news release.

North American Palladium: Re-engineering the Future

North American Palladium is a precious metals company that owns the LDI mine, which produced platinum group metals for 15 years until October 2008 when it was placed on temporary care and maintenance due to low metal prices. Prior to the temporary shutdown, the mine had annual production of 270,000 ounces of palladium, 20,000 ounces of platinum and 20,000 ounces of gold. The Company also owns and operates the Sleeping Giant gold mine located in the Abitibi region of Quebec, which produced over 1 million ounces of gold from 1988-2008 at an average grade of 11.44 g/t. North American Palladium expects gold production to resume in the fourth quarter of 2009 at an annual rate of 50,000 ounces. North American Palladium benefits from operating in a politically stable jurisdiction with developed infrastructure and a history of innovation and excellence in mining. Please visit www.nap.com for more information.

Cautionary Statement on Forward Looking Information

Certain information included in this press release, including any information as to our future exploration, financial or operating performance and other statements that express management's expectations or estimates of future performance, constitute 'forward-looking statements' within the meaning of the 'safe harbor' provisions of the United States Private Securities Litigation Reform Act of 1995 and Canadian securities laws. The words 'expect', 'believe', 'will', 'intend', 'estimate' and similar expressions identify forward-looking statements. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management, are inherently subject to significant business, economic and competitive uncertainties, risks and contingencies. The Company cautions the reader that such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual financial results, performance or achievements of North American Palladium to be materially different from the Company's estimated future results, performance or achievements expressed or implied by those forward-looking statements and that the forward-looking statements are not guarantees of future performance. These statements are also based on certain factors and assumptions. For more details on these estimates, risks, assumptions and factors, see the Company's most recent Form 40-F/Annual Information Form on file with the U.S. Securities and Exchange Commission and Canadian provincial securities regulatory authorities. In addition, there can be no assurance that the Company's Lac des Iles or Sleeping Giant mines will be successfully restarted or that other properties can be successfully developed. The Company disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, events or otherwise, except as expressly required by law. Readers are cautioned not to put undue reliance on these forward-looking statements.

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