LIBERTY STAR URANIUM & METALS CORP. - Annual Report: 2010 (Form 10-K)

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

(Mark One)

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended January 31, 2010

[   ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________ to _________

Commission file number 000-50071

LIBERTY STAR URANIUM & METALS CORP.
(Name of registrant as specified in its charter)

Registrant's telephone number (520) 731-8786

Securities registered pursuant to Section 12(b) of the Act:

Securities registered pursuant to Section 12(g) of the Act:

Common Stock, par value $0.00001
(Title of class)

Check whether the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act
Yes [   ]  No [ X ]

Check whether the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. [   ]

Note: Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Exchange Act from their obligations under those Sections.

Check whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes [X]  No [   ]

Check whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months.
Yes [   ] No [X]

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Check if there is disclosure of delinquent filers in response to Item 405 of Regulation S-K is not contained in this form, and no disclosure will be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [   ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definition of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes [   ] No [X]

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was sold, or the average bid and asked prices of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter.

Note: If determining whether a person is an affiliate will involve an unreasonable effort and expense, the issuer may calculate the aggregate market value of the common equity held by non-affiliates on the basis of reasonable assumptions, if the assumptions are stated.

55,222,579⁽¹⁾ shares of Common Stock @ $0.002⁽¹⁾ = $110,445

⁽¹⁾ Adjusted for retroactive effect of 1 for 4 reverse stock split on September 1, 2009. Closing price on July 31, 2009 was $0.008.

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date.

433,427,556 shares of Common Stock issued and outstanding as of May 10, 2010.

DOCUMENTS INCORPORATED BY REFERENCE

Not applicable.

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TABLE OF CONTENTS

FORWARD-LOOKING STATEMENTS

This annual report contains forward-looking statements. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as "may", "should", "expects", "plans", "anticipates", "believes", "estimates", "predicts", "potential" or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled "Risk Factors", that may cause our or our industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.

While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

Our consolidated financial statements are stated in United States Dollars (US$) and are prepared in conformity with accounting principles generally accepted in the United States of America. The following discussion should be read in conjunction with our consolidated financial statements and the related notes that appear elsewhere in this annual report.

As used in this annual report, the terms "we", "us", and "Liberty Star" mean Liberty Star Uranium & Metals Corp. and our subsidiaries Big Chunk Corp. and Redwall Drilling Inc., unless otherwise indicated. All dollar amounts refer to U.S. dollars unless otherwise indicated.

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PART I

Item 1.        Description of Business.

Business development

Liberty Star Uranium & Metals Corp. was formerly Liberty Star Gold Corp. and formerly Titanium Intelligence, Inc. Titanium was incorporated on August 20, 2001 under the laws of the State of Nevada. On February 5, 2004 we commenced operations in the acquisition and exploration of mineral properties business. Big Chunk Corp. is our wholly owned subsidiary and was incorporated on December 14, 2003 in the State of Alaska. Big Chunk Corp. is engaged in the acquisition and exploration of mineral properties business in the State of Alaska. Redwall Drilling Inc. (“Redwall”) is our wholly owned subsidiary and was incorporated on August 31, 2007 in the State of Arizona. Redwall is a drilling contractor. On December 1, 2007 Redwall began performing drilling services on our mineral properties and others and ceased operations when essentially all of its assets were sold in February 2010. In April 2007, we changed our name to Liberty Star Uranium & Metals Corp. to reflect our current concentrated efforts on uranium exploration. We are considered to be an exploration stage company, as we have not generated any revenues from operations.

In December 2006, we entered into a joint venture agreement (“Elle Venture”) with XState Resources Limited (“XState”). We hold a 50% interest in the Elle Venture, a general partnership with XState that was formed to explore and, if warranted, develop certain mineral targets within the joint venture area.

Our current business

We are an exploration stage company engaged in the acquisition and exploration of mineral properties in the States of Arizona and Alaska. Claims in the State of Alaska are held in the name of our wholly-owned subsidiary, Big Chunk Corp. Claims in the State of Arizona are held in the name of Liberty Star. We use the term “Super Project” to indicate a project in which numerous mineral targets have been identified, any one or more of which could potentially contain commercially viable quantities of minerals. Our significant projects are described below.

North Pipes Super Project (“NPSP”): Located in Northern Arizona on the Arizona Strip, we plan to ascertain whether the North Pipes Super Project claims possess commercially viable deposits of uranium. We have approximately 300 potential breccia pipe targets. We have not identified any ore reserves to date.

Big Chunk Super Project (“Big Chunk”): Located in the Iliamna region of Southwestern Alaska, we plan to ascertain whether the Big Chunk claims possess commercially viable deposits of copper, gold, molybdenum, silver and zinc. We have not identified any ore reserves to date.

Bonanza Hills Project (“Bonanza Hills”): Located in the Iliamna region of Southwestern Alaska, we plan to ascertain whether the Bonanza Hills claims possess commercially viable deposits of gold and silver. We have not identified any ore reserves to date.

Title to mineral claims involves certain inherent risks due to difficulties of determining the validity of certain claims as well as potential for problems arising from the frequently ambiguous conveyancing history characteristic of many mineral properties. We have investigated title to all its mineral properties and, to the best of its knowledge, title to all properties are in good standing.

The mineral resource business generally consists of three stages: exploration, development and production. Mineral resource companies that are in the exploration stage have not yet found mineral resources in commercially exploitable quantities, and are engaged in exploring land in an effort to discover them. Mineral resource companies that have located a mineral resource in commercially exploitable quantities and are preparing to extract that resource are in the development stage, while those engaged in the extraction of a known mineral resource are in the production stage. We are in the exploration stage – we have not found any mineral resources in commercially exploitable quantities.

Mineral resource exploration can consist of several stages. The earliest stage usually consists of the identification of a potential prospect through either the discovery of a mineralized showing on that property or as the result of a property being in proximity to another property on which exploitable resources have been identified, whether or not they are or have in the past been extracted.

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After the identification of a property as a potential prospect, the next stage would usually be the acquisition of a right to explore the area for mineral resources. This can consist of the outright acquisition of the land or the acquisition of specific, but limited, rights to the land (e.g., a federal or state mining claim, state prospecting permit or lease). After acquisition, exploration would probably begin with a surface examination by a professional geologist with the aim of identifying areas of potential mineralization, followed by detailed geological sampling and mapping of this showing with possible geophysical and geochemical grid surveys to establish whether a known trend of mineralization continues through un-exposed portions of the property (i.e., underground). Exploration also commonly includes systematic regularly spaced drilling in order to determine the extent and grade of the mineralized system at depth and over a given area, as well as gaining underground access by ramping or shafting in order to obtain bulk samples that would allow one to determine the ability to recover various commodities from the rock. Exploration would conclude with a feasibility study to determine whether mining the minerals would make economic sense. A feasibility study is a study that reaches a conclusion with respect to the economics of bringing a mineral resource to the production stage.

There is no assurance that a commercially viable mineral deposit exists on any of our properties, and further exploration is required before we can evaluate whether any exist and, if so, whether it would be economically feasible to develop or exploit those resources. Even if we complete our current exploration program and we are successful in identifying a mineral deposit, we would be required to spend substantial funds on further drilling and engineering studies before we could know whether that mineral deposit will constitute an ore reserve (an ore reserve is a commercially viable mineral deposit). Please refer to the section entitled "Risk Factors" for additional information about the risks of mineral exploration.

To date, we have not generated any revenues and we remain in the exploration stage. Our ability to pursue our business plan and generate revenues is subject to our ability to obtain additional financing, and we cannot give any assurance that we will be able to do so.

Competition

We are a mineral resource exploration stage company engaged in the business of mineral exploration. We compete with other mineral resource exploration stage companies for financing from a limited number of investors that are prepared to make investments in mineral resource exploration stage companies. The presence of competing mineral resource exploration stage companies may impact our ability to raise additional capital in order to fund our property acquisitions and exploration programs if investors are of the view that investments in competitors are more attractive based on the merit of the mineral properties under investigation and the price of the investment offered to investors.

We also compete for mineral properties of merit with other exploration stage companies. Competition could reduce the availability of properties of merit or increase the cost of acquiring additional mineral properties.

Many of the resource exploration stage companies with whom we compete may have greater financial and technical resources than we do. Accordingly, these competitors may be able to spend greater amounts on acquisitions of properties of merit and on exploration of their properties. In addition, they may be able to afford greater geological expertise in the targeting and exploration of resource properties. This competition could result in our competitors having resource properties of greater quality and interest to prospective investors who may finance additional exploration and to senior exploration stage companies that may purchase resource properties or enter into joint venture agreements with junior exploration stage companies. This competition could adversely impact our ability to finance property acquisitions and further exploration.

Compliance with Government Regulation

We will be required to comply with all regulations, rules and directives of governmental authorities and agencies applicable to the exploration of minerals in the States of Arizona and Alaska.

We are required to perform annual assessment work in order to maintain the Big Chunk and Bonanza Hills Alaska State mining claims. If annual assessment work is not performed we must pay the assessment amount in cash in order to maintain the claims. Completion of annual assessment work in the amount of $400 per ¼ section (160 acre) claim or $100 per ¼ -¼ section (40 acre) claim extends the claims for a one year period. Assessment work performed in excess of the required amount may be carried forward for up to 4 years to reduce future obligations for assessment work. We estimate that the required annual assessments to maintain the claims will be approximately $298,600.

The annual state rentals for the Big Chunk and Bonanza Hills Alaska State mining claims vary from $70 to $280 per mineral claim. The rental period begins at noon September 1^st through the following September 1^st and annual rental payments are due on November 30^th of each year. Annual rent is due in full within 45 days of staking a new claim and covers the period from staking until the next September 1^st. Claims that are staked in accordance with AS 38.05.195(b)(1) meridian, township, range, section and claim system location “MTRSC” receive a one-time only credit of 50% of the second year’s rent payment. Our Alaska claims are all MTRSC claims eligible for the 50% rental credit in the second rental year. Rentals for the period from September 1, 2009 through September 1, 2010 of $202,440 have been paid. The estimated state rentals due by November 30, 2010 for the period from September 1, 2010 through September 1, 2011 are $202,440. Alaska State production royalty is three percent of net income. State law prescribes that after a 3.5 -year exemption from state taxes a metal mine is liable for a 15% state licensing tax on net income from the mine.

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Our North Pipes Super Project claims are Federal lode mining claims located on U.S. Federal Lands and administered by the Department of Interior, Bureau of Land Management. The Bureau of Land Management is preparing an environmental impact statement (EIS) addressing potential effects of withdrawing Federal lands from locatable mineral exploration and mining near the Grand Canyon in Arizona. Nearly 1 million acres of land managed by the BLM and the Forest Service were segregated in July 2009 by the Secretary of Interior. The segregation stops the location of any new mining claims for two years. In that period, the land will be evaluated for withdrawal for up to 20 additional years. We are required to pay annual rentals to maintain its Federal lode mining claims in good standing. The rental period begins at noon on September 1^st through the following September 1^st and rental payments are due by the first day of the rental period. The annual rental was $125 per claim and increased to $140 per claim effective September 1, 2009. Additional fees of $45 per claim are due in the first year of filing a Federal lode mining claim along with the first year’s rent. The annual rentals required to maintain the NPSP claims are $250,460. There is no requirement for annual assessment or exploration work on the Federal lode mining claims. There are no royalties associated with the Federal lode mining claims.

In order to perform a drilling program on our Arizona claims, we have to apply for various permits with the State of Arizona and the Federal Bureau of Land Management (“USBLM”). The permitting process takes several weeks. The drilling permit fees are anticipated to be approximately $5,000 per pipe and also require a reclamation bond of up to $50,000 per pipe. We do not currently have any drilling permits for our Arizona claims.

In order to proceed with mining operations on our Arizona claims, we will have to apply for various permits with the State of Arizona and various Federal agencies. The cost of mine permitting, including cost of contractors assisting with the permitting process, is estimated to be $350,000 per mine location. The mining permitting process has not begun as there is no assurance that a commercially viable mineral deposit exists on any of our properties, and further exploration is required before we can evaluate whether any exist and, if so, whether it would be economically feasible to develop or exploit those resources.

Additional approvals and authorizations may be required from other government agencies, depending upon the nature and scope of the proposed exploration program. The amount of these costs is not known at this time as we do not know the size, quality of any resource or reserve at this time, it is impossible to assess the impact of any capital expenditures on earnings or our competitive position.

Personnel

We have one full time employee, one part-time employee and four part-time consultants. Currently we employ one full time geologist who is also our President and CEO, James Briscoe. We have two part-time accounting staff, one part time public relations consultant, one part time geology consultant and one part time information technology consultant.

Item 1A.        RISK FACTORS

Much of the information included in this annual report includes or is based upon estimates, projections or other "forward-looking statements". Such forward-looking statements include any projections or estimates made by us and our management in connection with our business operations. While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein.

Such estimates, projections or other "forward-looking statements" involve various risks and uncertainties as outlined below. We caution the reader that important factors in some cases have affected and, in the future, could materially affect actual results and cause actual results to differ materially from the results expressed in any such estimates, projections or other "forward-looking statements".

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Risks related to our business

Because of the speculative nature of the exploration of natural resource properties, there is substantial risk that this business will fail.

There is no assurance that any of the claims we explore or acquire will contain commercially exploitable reserves of minerals. Exploration for natural resources is a speculative venture involving substantial risk. Hazards such as unusual or unexpected geological formations and other conditions often result in unsuccessful exploration efforts. We may also become subject to significant liability for pollution or hazards, which we cannot insure or which we may elect not to insure. There is substantial risk that our business will fail.

If we cannot compete successfully for financing and for qualified managerial and technical employees, our exploration program may suffer.

Our competition in the mining industry includes large established mining companies with substantial capabilities and with greater financial and technical resources than we have. As a result of this competition, we may be unable to acquire additional financing on terms we consider acceptable because investors may choose to invest in our competitors instead of investing in us. We also compete with other mining companies in the recruitment and retention of qualified managerial and technical employees. Our success will be largely dependent on our ability to hire and retain highly qualified personnel. These individuals are in high demand and we may not be able to attract the personnel we need. We may not be able to afford the high salaries and fees demanded by qualified personnel, or may lose such employees after they are hired. If we are unable to successfully compete for financing or for qualified employees, our exploration program may be slowed down or suspended.

Exploration and exploitation activities are subject to comprehensive regulation which may cause substantial delays or require capital outlays in excess of those anticipated causing an adverse effect on our company.

Exploration and exploitation activities are subject to federal, state, and local laws, regulations and policies, including laws regulating the removal of natural resources from the ground and the discharge of materials into the environment. Exploration and exploitation activities are also subject to federal, state, and local laws and regulations which seek to maintain health and safety standards by regulating the design and use of drilling methods and equipment.

Various permits from government bodies are required for drilling operations to be conducted; no assurance can be given that such permits will be received. Environmental and other legal standards imposed by federal, state, or local authorities may be changed and any such changes may prevent us from conducting planned activities or increase our costs of doing so, which would have material adverse effects on our business. Moreover, compliance with such laws may cause substantial delays or require capital outlays in excess of those anticipated, thus causing an adverse effect on us. Additionally, we may be subject to liability for pollution or other environmental damages which we may not be able to or elect not to insure against due to prohibitive premium costs and other reasons. Any laws, regulations or policies of any government body or regulatory agency may be changed, applied or interpreted in a manner which will alter and negatively affect our ability to carry on our business.

There are no known reserves of minerals on our mineral claims and we cannot guarantee that we will find any commercial quantities of minerals.

We have not found any mineral reserves on our claims and there can be no assurance that any of our mineral claims contain commercial quantities of any minerals. Even if we identify commercial quantities of minerals in any of our claims, there can be no assurance that we will be able to exploit the reserves or, if we are able to exploit them, that we will do so on a profitable basis.

Because the probability of an individual prospect ever having reserves is extremely remote, any funds spent on exploration will probably be lost.

The probability of an individual prospect ever having reserves is extremely remote. In all probability our properties do not contain any reserves. As such, any funds spent on exploration will probably be lost which would most likely result in a loss of your investment.

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Risks related to our company

We were in default on the May 2007 Convertible Notes, August 2008 Convertible Notes, May 2009 Convertible Notes and the August 2009 Convertible Notes and as such the note holders may call the notes.

We were in default on the May 2007 Convertible Notes, August 2008 Convertible Notes, May 2009 Convertible Notes, and the August 2009 Convertible Notes and as such the entire obligation is reported as a current liability. In February 2010 we modified the terms of these notes with three of the nine note holders to extend their maturity dates to February 28, 2011with two 180 day extensions exercisable by the holder. The three note holders who signed the extension and modification agreement hold a majority of the outstanding balance of all notes. The note holders have a security interest in all assets and mineral properties and as a result we are unable to sell any assets without prior approval from the note holders. If the note holders were to call the notes and we were unable to satisfy the obligation the note holders could proceed against the assets and mineral claims that collateralize the notes. These restrictions may make it difficult for us to raise the cash required to perform exploration activities.

The recent weakening of economic conditions in the U.S. and around the world could have harmful effects on our ability to sell shares of our common stock. These harmful effects have caused us to cease our exploration program and they may not start up again, as a result we could go out of business and our shareholders will likely lose their entire investment in our company.

The recent weakening of economic conditions in the U.S. and around the world as well as the decrease in uranium and other mineral processing could have harmful effects on our business. Competition for limited funds from investors will likely become more intense. If investors choose not to invest in our company, we will not be able to fund our exploration program.

We will require additional funds to maintain our current mineral properties. These funds may be raised through equity financing, debt financing, or other sources, which may result in further dilution in the equity ownership of our shares. However, many investors have recently seen large decreases in the value of various investments due to declining share prices across many economic sectors. Because of this and other market factors, if we choose to raise funds through the sale of our equity securities, potential investors may be less likely to buy our equity securities or we may need to sell our equity securities at low prices, resulting in fewer proceeds. This would make it difficult for us to raise adequate amounts to fund our exploration program through the sale of our equity securities.

If we are unable to restart our exploration programs through funding received from the sale of our equity securities, then we may choose to borrow the money we need. A tightening of credit conditions has also been experienced in the economy recently. Because of the recent credit crisis, it is possible that we would not be able to borrow adequate amounts to restart our exploration program on terms and at rates of interest we find acceptable and in the best interests of our company.

If we cannot restart our exploration programs from the sale of our equity securities or through incurring debt on acceptable terms, then we will likely go out of business and our shareholders will likely lose their entire investment in our company.

We have a limited operating history and as a result there is no assurance we can operate on a profitable basis.

We have a limited operating history and must be considered in the exploration stage. Our operations will be subject to all the risks inherent in the establishment of an exploration stage enterprise and the uncertainties arising from the absence of a significant operating history. Potential investors should be aware of the difficulties normally encountered by mineral exploration companies and the high rate of failure of such enterprises, especially those with a limited operating history. The likelihood of success must be considered in light of the problems, expenses, difficulties, complications and delays encountered in connection with the exploration of the mineral properties that we plan to undertake. These potential problems include, but are not limited to, unanticipated problems relating to exploration, and additional costs and expenses that may exceed current estimates. The expenditures to be made by us in the exploration of the mineral claim may not result in the discovery of mineral deposits. Problems such as unusual or unexpected formations of rock or land and other conditions are involved in mineral exploration and often result in unsuccessful exploration efforts. If the results of our exploration do not reveal viable commercial mineralization, we may decide to abandon our claim and acquire new claims for new exploration or cease operations. The acquisition of additional claims will be dependent upon us possessing capital resources at the time in order to purchase such claims. If no funding is available, we may be forced to abandon our operations. No assurance can be given that we will ever operate on a profitable basis.

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If we do not obtain additional financing, our business will fail and our investors could lose their investment.

We had cash in the amount of $20,522 and negative working capital of $(3,625,627) as of January 31, 2010. We currently do not generate revenues from our operations. Our business plan calls for substantial investment and cost in connection with the acquisition and exploration of our mineral properties currently under lease and option. Any direct acquisition of any of the claims under lease or option is subject to our ability to obtain the financing necessary for us to fund and carry out exploration programs on the subject properties. The requirements are substantial. We do not currently have any arrangements for financing in addition to the May 2007 Convertible Notes, August 2008 Convertible Notes, May 2009 Convertible Notes and August 2009 Convertible Notes, further described in Note 6 to the consolidated financial statements included in Item 8 of this form, and we can provide no assurance to investors that we will be able to find such financing when required. The Convertible Promissory Notes contain restrictions on raising new capital from the sale of registered stock to other investors. We are also limited to raising up to $7,000,000 in private placement funds during the term of the Convertible Notes, during the Exclusion Period as defined in the notes, and during the pendency of any Event of Default as defined in the notes. The August 2008 Convertible Notes, May 2009 Convertible Notes, and August 2009 Convertible Notes contain restrictions that require that the August 2008, May 2007, May 2009, and August 2009 convertible notes be repaid in full from the first $3,000,000 of financings we complete. These restrictions may make it difficult for us to raise the cash required to proceed with our planned exploration activities. There is no assurance that we will be able to maintain operations at a level sufficient for an investor to obtain a return on their investment in our common stock. Further, we may continue to be unprofitable. In addition to the restrictions placed on us by our various financing agreements, obtaining additional financing would be subject to a number of factors, including market prices for minerals, investor acceptance of our properties, contractual restrictions on our ability to enter into further financing arrangements, and investor sentiment. These factors may make the timing, amount, terms or conditions of additional financing unavailable to us and our business could fail.

Because there is no assurance that we will generate revenues, we face a high risk of business failure.

We have not earned any revenues as of the date of this filing and have never been profitable. We do not have an interest in any revenue generating properties. We were incorporated on August 20, 2001 and took over our current business on February 5, 2004. To date we have been involved primarily in organizational and exploration activities. We will incur substantial operating and exploration expenditures without realizing any revenues. We therefore expect to incur significant losses into the foreseeable future. We have limited operating history upon which an evaluation of our future success or failure can be made. Our net loss from inception to January 31, 2010 is $(39,104,383). We recognize that if we are unable to generate significant revenues from our activities, we will not be able to earn profits or continue operations. Based upon current plans, we also expect to incur significant operating losses in the future. We cannot guarantee that we will be successful in raising capital to fund these operating losses or generate revenues in the future. We can provide investors with no assurance that we will generate any operating revenues or ever achieve profitable operations. If we are unsuccessful in addressing these risks, our business will most likely fail and our investors could lose their investment.

Our independent registered public accounting firm’s report states that there is a substantial doubt that we will be able to continue as a going concern.

Our independent registered public accounting firm, Semple, Marchal & Cooper, LLP, state in their audit report attached to our audited financial statements for the fiscal year ended January 31, 2010 that since we are an exploration stage company, have no established source of revenue and are dependent on our ability to raise capital from shareholders or other sources to sustain operations, there is a substantial doubt that we will be able to continue as a going concern.

The existence of our mining claims depends on our ability to fund exploratory activity or to pay fees.

Our mining claims, which are the central part of our business, require that we either pay fees, or incur certain minimum development costs annually, or the claims will be forfeited. Do to our current financial situation we may not be able to meet these obligations and we could therefore lose our claims. This would impair our ability to raise capital and would negatively impact the value of the Company.

Risks related to our common stock

Because we will likely issue additional shares of our common stock, investment in our company could be subject to substantial dilution.

Investors’ interests in our company will be diluted and investors may suffer dilution in their net book value per share when we issue additional shares. Our constating documents authorize the issuance of up to 200,000,000 shares of common stock with a par value of $0.001. At our shareholder meeting held on May 27, 2009 the shareholders voted to increase the number of authorized shares to 10,000,000,000 shares of common stock with a par value of $0.001. We filed a certificate of amendment on June 4, 2009 to increase the number of authorized shares to 5,000,000,000 shares of common stock with a par value of $0.001. On September 1, 2009 we completed a one for four reverse stock split of our authorized and outstanding common stock resulting in a decrease in authorized shares to 1,250,000,000 with a par value of $0.00001. As of January 31, 2010, there were 247,656,979 of our common shares issued and outstanding. We anticipate that all or at least some of our future funding, if any, will be in the form of equity financing from the sale of our common stock. If we do sell more common stock, investors’ investment in our company will likely be diluted. Dilution is the difference between what you pay for your stock and the net tangible book value per share immediately after the additional shares are sold by us. If dilution occurs, any investment in our company’s common stock could seriously decline in value.

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Dilution will likely occur because of the Convertible Notes and related common share purchase warrants that we issued on May 11, 2007 and August 14, 2009. First, the entire amount of money owed under the May 2007, August 2008 and May 2009 Convertible Notes plus 12% interest per year, may be converted into shares of our common stock at a price that is the lesser of $0.005 per share or 80% of the average closing bid price for the five trading dates prior to the repayment date. The entire amount of money owed under the August 2009 Convertible Notes plus 12% interest per year, may be converted into shares of our common stock at a price that is the lesser of $0.0025 per share or 75% of the average closing bid price for the five trading dates prior to the repayment date. The May 2007 Convertible Notes matured on May 11, 2009 but still remain unpaid. The August 2008 Convertible Notes matured on August 27, 2009 but still remain unpaid. The May 2009 Convertible Notes mature on May 21, 2010. The August 2009 Convertible Notes mature on August 14, 2010. In November 2008 we were in default on the May 2007 and August 2008 Convertible Notes as we did not have enough shares remaining in our authorized capital to be able to fulfill the conversion requests received and as such the interest rate was increased to 15%. Our convertible note holders could call the note and request security to be sold for repayment. Three of the nine note holders signed an extension and modification agreement to extend the maturity date of the May 2007 and August 2008 Convertible Notes to February 28, 2011. The three note holders who signed the agreement hold a majority of the outstanding principal balances. Second, the 6,769,228 common share purchase warrants that we issued to the holders of the May 2007 Convertible Notes on May 11, 2007 may be exercised at $0.005 and $0.05 per share until they expire on May 11, 2012. Third, the 338,461 common share purchase warrants that we issued to the broker of the May 2007 Convertible Notes as a broker fee on May 11, 2007 may be exercised at $0.05 per share until they expire on May 11, 2012. Fourth, the 235,670,800 common share purchase warrants that we issued to the holders of the August 2009 Convertible Notes may be exercised at $0.005 until they expire on August 14, 2015. Because additional common shares will be issued as a result of some of or all of these factors, there likely will be significant dilution of investment in our company. This would cause a reduction in the proportionate ownership and voting power of all other shareholders and may result in a change in our control.

The sale of our stock under the Convertible Notes and the common share purchase warrants could encourage short sales by third parties, which could contribute to the future decline of our stock price.

In many circumstances, the provision of financing based on the distribution of equity for companies that are traded on the Over-the-Counter Bulletin Board has the potential to cause a significant downward pressure on the price of common stock. This is especially the case if the shares being placed into the market exceed the market’s ability to take up the increased stock or if we have not performed in such a manner to show that the equity funds raised will be used to grow our business. Such an event could place further downward pressure on the price of our common stock. Regardless of our activities, the opportunity exists for short sellers and others to contribute to the future decline of our stock price. If there are significant short sales of our common stock, the price decline that would result from this activity will cause the share price to decline more, which may cause other shareholders of the stock to sell their shares, thereby contributing to sales of common stock in the market. If there are many more shares of our common stock on the market for sale than the market will absorb, the price of our common shares will likely decline.

Trading in our common stock on the OTC Bulletin Board is limited and sporadic making it difficult for our shareholders to sell their shares or liquidate their investments.

Our common stock is currently listed for public trading on the OTC Bulletin Board. The trading price of our common stock has been subject to wide fluctuations. Trading prices of our common stock may fluctuate in response to a number of factors, many of which will be beyond our control. The stock market has generally experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of companies with no current business operation. There can be no assurance that trading prices and price earnings ratios previously experienced by our common stock will be matched or maintained. These broad market and industry factors may adversely affect the market price of our common stock, regardless of our operating performance. In the past, following periods of volatility in the market price of a company's securities, securities class-action litigation has often been instituted. Such litigation, if instituted, could result in substantial costs for us and a diversion of management's attention and resources.

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Our By-laws contain provisions indemnifying our officers and directors against all costs, charges and expenses incurred by them.

Our By-laws contain provisions with respect to the indemnification of our officers and directors against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, actually and reasonably incurred by him, including an amount paid to settle an action or satisfy a judgment in a civil, criminal or administrative action or proceeding to which he is made a party by reason of his being or having been one of our directors or officers.

Our By-laws do not contain anti-takeover provisions which could result in a change of our management and directors if there is a take-over of our company.

We do not currently have a shareholder rights plan or any anti-takeover provisions in our By-laws. Without any anti-takeover provisions, there is no deterrent for a take-over of our company, which may result in a change in our management and directors. This could result in a disruption to the activities of our company, which could have a material adverse effect on our operations.

We do not intend to pay dividends on any investment in the shares of stock of our company and any gain on an investment in our company will need to come through an increase in our stock’s price, which may never happen.

We have never paid any cash dividends and currently do not intend to pay any dividends for the foreseeable future. To the extent that we require additional funding currently not provided for in our financing plan, our funding sources may prohibit the payment of a dividend. Because we do not intend to declare dividends, any gain on an investment in our company will need to come through an increase in the stock’s price. This may never happen and investors may lose all of their investment in our company.

Because our securities are subject to penny stock rules, you may have difficulty reselling your shares.

Our shares as penny stocks, are covered by Section 15(g) of the Securities Exchange Act of 1934 which imposes additional sales practice requirements on broker/dealers who sell our company's securities including the delivery of a standardized disclosure document; disclosure and confirmation of quotation prices; disclosure of compensation the broker/dealer receives; and, furnishing monthly account statements. These rules apply to companies whose shares are not traded on a national stock exchange or on the Nasdaq system, trade at less than $5.00 per share, or who do not meet certain other financial requirements specified by the Securities and Exchange Commission. These rules require brokers who sell "penny stocks" to persons other than established customers and "accredited investors" to complete certain documentation, make suitability inquiries of investors, and provide investors with certain information concerning the risks of trading in such penny stocks. These rules may discourage or restrict the ability of brokers to sell our shares of common stock and may affect the secondary market for our shares of common stock. These rules could also hamper our ability to raise funds in the primary market for our shares of common stock.

Item 2.        Description of Property.

Our offices

We rent the premises for our principal office located at 5610 E Sutler Lane, Tucson, Arizona 85712. We rent the office space which is located in the home of our President and CEO for $459 per month plus a pro rata share of taxes and maintenance. Our part-time employees work either from our principal office or from offices maintained in their homes.

We believe that our existing office facilities are adequate for our needs through the end of the year ended January 31, 2011. Should we require additional space at that time, or prior thereto, we believe that such space can be secured on commercially reasonable terms.

Our mineral claims

North Pipes Super Project (“NPSP”) see Figure 1:

We hold a 100% interest in 1,775 Federal lode mining claims strategically placed over approximately 60 square miles on the Colorado Plateau Province of Northern Arizona. The 1,775 Federal lode mining claims include approximately 300 breccia pipe targets (“Pipes”). Breccia pipes are cylindrical formations in the Earth’s crust, identified by a surface depression, and containing a high concentration of fragmented rock “breccia” cemented by uranium and other minerals. We plan to ascertain whether our North Pipes Super Project claims possess commercially viable deposits of uranium.

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Our Arizona claims are on U.S. Federal Lands and are administered by the Department of Interior, Bureau of Land Management (surface and mineral) land. Our claims may be kept in good standing by paying an advance annual maintenance and rental fee before noon, September the 1st, in the amount of $140 per mining claim. To keep our existing property in good standing, we must pay annual maintenance and rental fees of $250,460. The State Mineral Exploration Permits are administered by the Arizona State Land Department located in Phoenix, Arizona.

The only royalties, payments or other encumbrances on the property are those owed to the Bureau of Land Management as mentioned above. No production royalties are due on mineral production. Federal taxes will be owed on profits made from mining on the properties. A royalty of approximately 3% of net mineral production after deducting mining and processing of ore is payable on the State land parcels.

Elle Venture with XState Resources Ltd (“XState”)(previously OCR Limited)

We also hold a 50% interest in Federal lode mining claims covering 3 breccia pipe targets at the North Pipes Super Project location through the Elle Venture, a general partnership with XState Resources Limited (“XState”). We plan to ascertain whether the Elle Venture claims possess commercially viable deposits of uranium.

Bonanza Hills Project (“Bonanza Hills”) see Figure 2:

We hold 56 mineral claims covering approximately 13.5 square miles in Southwestern Alaska approximately 40 miles northeast of the northern boundary of the Big Chunk claims. We plan to ascertain whether the Bonanza Hills claims possess commercially viable deposits of gold and silver.

Big Chunk Super Project (“Big Chunk”) see Figure 2:

We hold a 100% interest in 707 mineral claims covering approximately 177 square miles in the Iliamna region of Southwestern Alaska, located on the north side of the Cook Inlet, approximately 265 miles southwest of the city of Anchorage, Alaska. We plan to ascertain whether the Big Chunk claims possess commercially viable deposits of copper, gold, molybdenum, silver and zinc.

East Silver Bell:

We hold an option to explore 26 standard Federal lode mining claims located at the East Silver Bell region of Arizona. The mineral claims are owned by FOJ, LLC an Arizona Limited Liability Company in which two of our directors are owners.

Walnut Creek:

We hold an option to explore 33 standard Federal lode mining claims located due east and southeast of the town of Tombstone, Arizona. The mineral claims are owned by FOJ, LLC an Arizona Limited Liability Company in which two of our directors are owners.

Present condition of our claims

Both the Alaskan and Arizona properties are undeveloped. There are no open-pit or underground mines, nor is there any mining plant or equipment located on the properties. There is no power supply to the properties. There is not any road access to the Alaskan properties, but there is abundant road access to the Arizona properties. We have not found any mineral resources on any of our claims.

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Figure 1: North Pipes Super Project overview

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Figure 2: Alaska Properties – Big Chunk and Bonanza Hills- Location Map

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Claim status

We have investigated titles to all of our mineral properties and, to the best of our knowledge, titles to all properties are in good standing as of January 31, 2010. We estimate that we will be required to perform $298,600 of assessment work in order to maintain the Alaska claims in good standing for 2010. We estimate that we will be required to pay annual rentals of $202,440 by November 30, 2010 to maintain the Alaska claims in good standing. We estimate that we will be required to pay $250,460 by September 1, 2010 to maintain the North Pipes Super Project federal lode mining claims in good standing. We estimate that we will be required to pay $7,375 by September 1, 2010 to maintain the East Silver Bell and Walnut Creek federal lode mining claims in good standing.

Exploration History

Prior History

Except as indicated with respect to our Arizona claims and otherwise as set out below, we are unaware of any previous claim ownership anywhere on the properties, nor any exploration, other than minor surface sampling. No evidence of development work has been found on the properties. No historical mineral resources or reserves are in the published literature.

Our Alaska claims

Our Alaska claims are located in a remote area of Southwestern Alaska where limited exploration and development activity has occurred. The area is largely covered by glacial debris, soil, and tundra. Little geologic, geochemical or geophysical data is available, and that which is available is of a general nature and of low quality.

Our Big Chunk Super Project claims

We are unaware of any previous claim ownership anywhere on our Big Chunk claims in Alaska. No historical mineral resources or reserves are in the published literature concerning the property. Other than minor exploration that was conducted by Cominco Alaska, Anaconda and the United States Geological Survey, we are not aware of any prior exploration that was conducted on our Big Chunk claims in Alaska prior to January 10, 2004, when our aerial survey of the magnetic fields began.

Our Bonanza Hills claims

Anaconda and Cominco Alaska also conducted some minor tests on our Bonanza Hills claims in the past. The work they conducted consisted of surface sampling and a small geophysical survey. We are not aware of any other exploration that occurred there before we began our exploration there.

Our North Pipes Super Project claims

The Arizona Strip, where our North Pipes Super Project claims are located, was an active exploration district in the 1970’s and 1980’s with multiple producing uranium mines and huge tracts of claims held by companies including International Uranium Corp., Energy Fuels Nuclear, Pathfinder as well as others. The work accomplished by these companies included geophysics, geochemistry and drilling. Little to none of this information is available to the public, though many of the drill holes are marked and still visible. No evidence of actual development work has been found on any of our properties. No historical mineral resources or reserves are in the published literature.

Technical Studies and Drilling on the North Pipes Super Project, 2007 to Present.

Geophysics

We have completed PEM (Pulse Electro-magnetic) geophysical surveys on our North Pipes Super Project claims. Two types of PEM surveys were conducted in 2007: Downhole PEM and In-Loop PEM. These surveys were designed to test the applicability of this geophysical technique. At this time results are not conclusive. Downhole PEM may be used in the future.

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Stereoscopic geologic color air photo interpretation (photo-geology)

Stereoscopic geologic interpretation of 1:24,000 (1 inch = 2,000 feet) high resolution color air photographs was contracted and completed by Edward Ulmer, a Registered Professional Geologist who worked on the Arizona Strip in the mid to late 1970s. He has specialized throughout his career in geologic photo interpretation. His work built on the work started by Dr. Karen Wenrich. This air photo interpretative work was useful in defining and rating potential target areas.

Geologic field mapping on the surface

Geological field mapping has been ongoing during 2007 and 2008. Mapping has been performed by our staff geologists as well as contracted geologists. Approximately 180 of the 300 pipe target areas have been mapped in detail 1:5,000 (1 inch = 417 feet). Geologic mapping has been focused on favourable areas identified by air photo interpretation, geophysics, soil geochemistry and/or field reconnaissance. Several detailed measured stratigraphic sections have also been completed.

Geochemical sampling

A comprehensive soil geochemical survey was completed in 2007. Approximately 14,000 soil samples were collected. Samples were collected by employees and contractors. Strict chain of custody procedures were followed and quality assurance/quality control (QA/QC) samples were inserted regularly into the sample stream. The samples were assayed for 63 elements. Assay analyses were conducted by a Certified Assay Lab, Acme Analytical Laboratories of Vancouver, British Columbia, Canada. A geochemical Summit Meeting was held in Tucson with Technical Advisory Board members and our geologists on January 23^rd, 24^th and 25^th of 2008. Geochemical analyses developed by our employees and consultants and our technical board over the past 15 years were the basis for a rigorous and methodical interpretation of the complex geochemical data. Several geochemical signatures over known and suspected mineralized breccia pipe targets (held by others) were identified. These signatures were then compared to signatures in our target areas. Numerous target areas display favourable signatures.

Drilling

The following table summarizes completed drilling to date on the North Pipes Super Project:

Rotary drilling was contracted by Boyart Longyear. Diamond core drilling was completed by Redwall Drilling Inc., a wholly owned subsidiary of Liberty Star. A total of 16,226 feet of drilling has been completed.

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Technical Studies and Drilling on the Big Chunk Super Project, 2007 to Present.

We hired Geotech Ltd to perform 1D and 2D ZTEM geophysical surveys in 2009. The surveys covered 315.2 sq kilometers (121.7 sq miles) and consisted of north-south lines spaced 250 meters apart on our Big Chunk Super Project mineral claims. To date, only one line has had 2D inversion performed on it and 1,256 line kilometers have had 1D inversion performed on them. The 2D line crosses a circular EM feature consistent with a typical porphyry copper system defined in original testing of the ZTEM system in SE Arizona. This 2D model shows a typical low responsive area, which could correspond to an ore mineral core zone with a surrounding responsive cylinder representing a pyrite halo typical of porphyry systems.

The remainders of the lines are being processed to yield 2D models. In addition to the ZTEM data, our CEO and Chief Geologist, Jim Briscoe, along with other geocontractors, will be analyzing all existing geologic, geochemical and geophysical data sets. Our geological team will also continue working with the geophysicists at Geotech Ltd. to identify other circular features.

Item 3.        Legal Proceedings.

On January 26, 2010 the we were named in a lawsuit filed with the clerk of the Superior Court of Arizona in the County of Pima by our former landlord B&D Ventures LLC. The former landlord is seeking to obtain damages in the amount of $48,909 related to us terminating our lease obligation before the end of the lease term. We vacated the premises in January 2009 and the lease end date was November 30, 2010.

Item 4.        (Removed and Reserved)

PART II

Item 5.        Market for Common Equity and Related Stockholder Matters.

Our common stock was listed and commenced trading on the OTC Bulletin Board on July 15, 2003 when our corporate name was Titanium Intelligence Inc. On February 3, 2004, we merged with our subsidiary and changed our name to Liberty Star Gold Corp. and traded under the symbol "LBTS.OB". On April 16, 2007 we again changed our name to Liberty Star Uranium & Metals Corp. and our stock changed its trading symbol to “LBSU.OB”. On September 1, 2009 we effected a one for four reverse stock split of our authorized and issued and outstanding common stock. As a result our authorized capital decreased to 1,250,000,000 shares of common stock with a par value of $0.00001. Our stock is traded under a new symbol LBSR as of the opening of trading on September 1, 2009.

Since July 15, 2003, trading in our common stock has been limited and sporadic. The following table sets forth, for the periods indicated, the high and low bid prices for our common stock on the OTC Bulletin Board:

Our common stock is issued in registered form. The Nevada Agency and Trust Company, of Suite 880 Bank of America, 50 West Liberty Street, Reno, Nevada 89501 USA (telephone: 775.322.0626; facsimile 775.322.5632) is the registrar and transfer agent for our common stock.

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On January 31, 2010, the shareholders' list for our common stock showed 74 registered stockholders and 247,656,979 shares issued and outstanding. The closing sale price for our common stock on April 21, 2010, as reported on the OTC Bulletin Board, was $0.0018.

Recent Sales of Unregistered Securities

We issued 76,400,000 shares of unregistered shares of common stock to our directors and consultants on April 23, 2010 as compensation for services performed.

We issue convertible promissory notes in private placements of its securities to institutional investors pursuant to exemptions from registration set out in Rule 506 of Regulation D under the Securities Act of 1933. The convertible notes were issued in May 2007, August 2008, May 2009 and August 2009. In February 2010 we modified the terms of these notes with three of the nine note holders to extend their maturity dates to February 28, 2011 with two 180 day extensions exercisable by the holder. The three note holders who signed the extension and modification agreement hold a majority of the outstanding balance of all notes. We issued detachable common stock purchase warrants with the May 2007 and August 2009 convertible notes.

We issued 109,370,577 shares of common stock for conversions of $127,264 of principal and $24,905 of accrued interest on the Convertible Notes from February 1, 2010 to May 7, 2010.

On February 25, 2010 we entered into an extension and modification of the convertible promissory notes with three of the nine note holders. The three note holders who signed the extension and modification agreement hold a majority of the outstanding balance of all notes. The maturity dates for those notes are extended to February 28, 2011 with two 180 day extensions exercisable at the option of the holder.

May 2007 Convertible Notes:

On May 11, 2007, the we issued senior unsecured convertible two year promissory notes (“May 2007 Convertible Notes”) for gross proceeds of $4,400,000 in a private placement of its securities to institutional investors pursuant to exemptions from registration set out in Rule 506 of Regulation D under the Securities Act of 1933. The net proceeds received after placement agent fee, due diligence fee and legal fees was $4,010,238. The May 2007 Convertible Notes bear interest at 12% and 15% when in default.

We may elect to make repayments of the May 2007 Convertible Notes in cash at 110% of the principal amount due and 100% of the other amounts then due or by the issuance of shares of our common stock. The holders may elect to convert amounts owed on the notes at a conversion price which is the lesser of the fixed conversion price of $0.005 per share or 80% of the average of the closing bid prices of the common stock for the five trading days prior to the conversion date.

August 2008 Convertible Notes:

On August 27, 2008 we issued Secured Convertible Promissory one year notes (“August 2008 Convertible Notes”) for gross proceeds of $414,184 to the holders of the May 2007 Convertible Notes in a private placement of its securities to institutional investors pursuant to exemptions from registration set out in Rule 506 of Regulation D under the Securities Act of 1933. The net proceeds received were $372,434. The August 2008 Convertible Notes bear interest at 12% and 15% when in default.

We may elect to make repayments of the August 2008 Convertible Notes in cash at 110% of the principal amount due and 100% of the other amounts then due or by the issuance of shares of our common stock. The holders may elect to convert amounts owed on the notes at a conversion price which is the lesser of the fixed conversion price of $0.005 per share or 80% of the average of the closing bid prices of the common stock for the five trading days prior to the conversion date.

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May 2009 Convertible Notes:

On May 21, 2009, we completed the sale of $170,668 principal amount of 12% Secured Convertible Promissory Notes (“May 2009 Convertible Notes”) in a private placement of its securities to subscribers pursuant to the exemption from registration under the United States Securities Act of 1933 provided by Section 4(2), Section 4(6) and/or Rule 506 of Regulation D promulgated under the 1933 Act, each of which represented that they are “accredited investors” within the respective meanings ascribed to that term in Rule 501(a) under the Securities Act of 1933 and pursuant to the terms of a subscription agreement between the parties dated May 21, 2009. The net proceeds received were $157,468.

Pursuant to the terms of the convertible secured notes and the Subscription Agreement, interest accrues on the Notes at a rate of 12% per annum commencing on the date of the issuance of the May 2009 Convertible Notes. The May 2009 Convertible Notes principal must be repaid commencing October 15, 2009 in monthly amounts equal to 14.28% of the principal amount of the notes together with interest, accrued to each monthly payment date on the outstanding note principal. In the event a registration statement is effective or Common Stock may be immediately resold by the noteholders without volume or other restrictions, and an event of default is not pending then we may pay the monthly amount with registered or unregistered common stock valued at the lesser of the fixed conversion price of $0.005 (subject to certain adjustments), or 80% of the average of the closing bid prices of our common stock for the five trading days prior to the monthly payment date. We may, in any event, elect to pay the monthly amount in cash at 110% of the principal amount due and 100% of all other amounts then due. We must provide 10 days notice of whether payment will be made in cash or with stock. If the notice is not timely given, the noteholders shall have the option to elect to be paid in cash or common stock. Each monthly payment in kind will be limited to not more than 33% of the aggregate daily trading volume of the common stock for the 7 trading days preceding the relevant monthly payment date. We agreed to reserve for issuance to the subscribers not less than 175% of the amount of shares of common stock necessary to allow conversion of all notes at the conversion price in effect from time to time.

Pursuant to the terms of the Subscription Agreement, James Briscoe, our CEO, agreed not to sell or otherwise dispose of his shares of our common stock owned by him or which he has the right to acquire for a period of two years from the date of the Subscription Agreement, unless sold in the open market for over $0.90 per share.

August 2009 Convertible Notes:

On August 14, 2009, we completed the sale of $589,177 principal amount of 12% Secured Convertible Promissory Notes (“August 2009 Convertible Notes”) to five subscribers pursuant to the exemption from registration under the United States Securities Act of 1933 provided by Section 4(2), Section 4(6) and/or Rule 506 of Regulation D promulgated under the 1933 Act, each of which represented that they are “accredited investors” within the respective meanings ascribed to that term in Rule 501(a) under the Securities Act of 1933 and pursuant to the terms of a subscription agreement between the parties dated August 14, 2009. On November 27, 2009, we modified the August 2009 Convertible Notes so as to increase five such notes by an aggregate total of $206,075. Other aspects of the August 14, 2009 notes remain unchanged. The net proceeds received were $766,015. The notes mature on August 14, 2010.

Pursuant to the terms of the convertible secured notes and the Subscription Agreement, interest accrues on the Notes at a rate of 12% per annum commencing on the date of the issuance of the August 2009 Convertible Notes. The August 2009 Convertible Notes principal must be repaid commencing February 15, 2010 in monthly amounts equal to 20% of the principal amount of the notes together with interest, accrued to each monthly payment date on the outstanding note principal. In the event a registration statement is effective or Common Stock may be immediately resold by the noteholders without volume or other restrictions, and an event of default is not pending then we may pay the monthly amount with registered or unregistered common stock valued at the lesser of the fixed conversion price of $0.0025 (subject to certain adjustments), or 75% of the average of the closing bid prices of our common stock for the five trading days prior to the monthly payment date. We may, in any event, elect to pay the monthly amount in cash at 110% of the principal amount due and 100% of all other amounts then due. We must provide 10 days notice of whether payment will be made in cash or with stock. If the notice is not timely given, the noteholders shall have the option to elect to be paid in cash or common stock. Each monthly payment in kind will be limited to not more than 40% of the aggregate daily trading volume of the common stock for the 5 trading days preceding the relevant monthly payment date. We agreed to reserve for issuance to the subscribers not less than 175% of the amount of our shares of common stock necessary to allow conversion of all notes at the conversion price in effect from time to time.

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The holders of the August 2009 Convertible Notes were issued 58,917,700 detachable common stock purchase warrants with an exercise price of $0.00125 and a life of 6 years. The exercise price may be adjusted if we issue other shares, warrants or stock options before the expiration of the warrants at a price less than $0.005 per share.

We agreed to include at the option of each noteholder of the May 2009 and August 2009 notes the number of shares that may be converted pursuant to any note in any registration statement it files during such period, ahead of the rights granted to the subscribers in the May 2007 Convertible Notes and the subscribers in the August 2008 Convertible Notes. Noteholders are subject to certain limitations on their rights to convert the notes. The principal limitation is that unless waived, the holder may not, with certain limited exceptions, convert into a number of our shares that would, together with other shares held by the holder, exceed 4.99% of the then outstanding shares of our common stock after such conversion.

Provisions applicable to all convertible notes:

The entire principal and interest of the May 2007, August 2008, May 2009 and August 2009 notes will be payable upon our receipt of the net proceeds of a $3,000,000 offering of our debt or equity. Provided an event of default is not pending, we may prepay unconverted portions of the Note upon 20 days prior notice during which time noteholders may convert the amount of the note noticed for prepayment at the fixed conversion price. Such payment shall be equal to 125% of the principal amount being prepaid and the accrued interest. In the event that commencing on the date that is six months following the closing date and ending two years thereafter, Rule 144 is unavailable for the unrestricted resale of the conversion shares under the Notes, then we shall pay to the investor as liquidated damages for each thirty days (or pro rata for periods shorter than thirty days) a sum equal to 1.75% of the purchase price of the outstanding notes.

We granted a senior security interest over all of our assets to the holders of the May 2007, August 2008, May 2009 and August 2009 Convertible Notes. In addition, our wholly owned subsidiary, Big Chunk Corp. was required to provide the subscribers with a guaranty on the repayment of the loans.

Equity Compensation Plan Information

As of January 31, 2010 we had two compensation plans in place, entitled "2004 Stock Option Plan" and “2007 Stock Option Plan”. These plans have been approved by our security holders. These plans have been given retroactive effect of the 1 for 4 reverse stock split on September 1, 2009.

On May 21, 2008 we granted 106,250 non-qualified stock options to non-employee consultants and 762,500 incentive stock options to employees, officers and directors. The options have an exercise price of $0.055 per option. On June 26, 2008 the board eliminated the vesting period so the options would be fully vested effective on that date. The options have a life of ten years.

Item 6.        Selected Financial Data.

Not applicable.

Item 7.        Management's Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion should be read in conjunction with our consolidated audited financial statements and the related notes that appear elsewhere in this annual report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. We refer you to the cautionary statement regarding forward-looking statements included at the beginning of this annual report. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this annual report, particularly in the section entitled "Risk Factors" included in this annual report.

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Our consolidated audited financial statements are stated in United States Dollars and are prepared in accordance with accounting principles generally accepted in the United States of America.

Overview

We are an exploration stage company engaged in the acquisition and exploration of mineral properties in the States of Arizona and Alaska. Claims in the State of Alaska are held in the name of our wholly-owned subsidiary, Big Chunk Corp. Claims in the State of Arizona are held in the name of Liberty Star. We use the term “Super Project” to indicate a project in which numerous mineral targets have been identified, any one or more of which could potentially contain commercially viable quantities of minerals.

Liquidity and Capital Resources

We had cash and cash equivalents in the amount of $20,522 as of January 31, 2010. We had negative working capital of $(3,625,627) as of January 31, 2010. We had cash inflows from financing activities of $886,140 for the year ended January 31, 2010. During the fiscal year ended January 31, 2010 we sold additional convertible promissory notes in order to raise funds to meet our obligations. Over the next twelve months we will need to pay annual rentals on our North Pipes, Big Chunk and Bonanza Hills claims or we will risk forfeiting our claims. We do not currently have these funds. We intend to perform only the minimal exploration work necessary to maintain these claims in good standing for an estimated cost of $751,500.

In February 2010 we sold substantially all of our drilling assets owned by Redwall and raised net cash inflows of $266,630 most of which has been used to pay our accounts payable. We require additional cash inflows in order to meet our current obligations. We will require additional cash inflows in order to maintain our mineral claims in good standing during 2010.

The convertible note holders have a security interest in all assets and mineral properties. The convertible promissory notes contain restrictions on raising new capital from the sale of registered stock to other investors. We are also limited to raising up to $7,000,000 in private placement funds while the convertible promissory notes are outstanding. The convertible promissory notes contain restrictions that require that the convertible notes be repaid in full from the first $3,000,000 of financings we complete. These restrictions may make it difficult for us to raise the cash required to maintain our mineral properties. There is no assurance that we will be able to maintain operations at a level sufficient for an investor to obtain a return on their investment in our common stock. Further, we may continue to be unprofitable. The company does not plan to make any capital expenditures for new mineral claims or equipment during the next twelve months.

In addition to the restrictions placed on us by our various financing agreements, the recent weakening of economic conditions in the U.S. and around the world could have harmful effects on our ability to raise money to fund our planned operations. If this happens, we would likely go out of business and our investors will lose their entire investment in our company.

We believe that recent decreases in value of the common shares of many companies worldwide will make selling shares of our common stock increasingly difficult. If we are not able to sell enough of our shares to meet our financial needs, we will have to consider borrowing the money we need. A tightening of credit conditions has also been experienced in the economy recently. Because of the recent credit crisis, it is possible that we would not be able to borrow adequate amounts to fund our operations on terms and at rates of interest we find acceptable and in the best interests of our company. If we are unable to obtain the amount of money that we need to fund our operations, then we will likely go out of business and investors will lose their entire investment in our company.

We do not expect that the difficult economic conditions are likely to improve significantly in the near future. Further deterioration of the economy, and even consumer fear that the economy will deteriorate further could intensify the adverse effects of these difficult market conditions.

There is no assurance that we will be able to raise additional funds in the amounts and at the times we will require them. Please refer to the section of this quarterly report entitled "Risk Factors" for a more detailed description of the risks that we will face, and the risks that any person investing in our company will face, that may arise as the result of our attempt to raise money for the continuation of our exploration program through the sale of equity in our company. Because of these risks and for other reasons, our auditors, in their report on the annual consolidated financial statements for the year ended January 31, 2010, included an explanatory paragraph regarding their concerns about our ability to continue as a going concern.

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At January 31, 2010 we had $3,209,958 of outstanding principal and $316,233 of accrued interest on our Convertible Notes. We are currently in default on these notes as we have failed to reserve an adequate number of shares to be issued upon conversion. If the note holders were to call the notes and we are unable to satisfy the obligation the note holders could proceed against the assets and mineral properties that collateralize the notes.

Results of Operations for the year ended January 31, 2010

We had a net loss of ($2,809,843) for the twelve-month period ended January 31, 2010 compared to a net loss of ($4,176,066) for the twelve-month period ended January 31, 2009. The reduction in net loss of approximately $1.36 million is mainly due to the following factors:

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.

Presentation of Financial Information

Our consolidated financial statements for the period ended January 31, 2010 reflect financial information for the twelve month period ending January 31, 2010, as well as from inception through January 31, 2010 and for the twelve-month period ended January 31, 2009.

Since we have not generated any revenue, we have included a reference to our ability to continue as a going concern in connection with our consolidated financial statements for the years ended January 31, 2010 and 2009. Our accumulated stockholders’ equity (deficit) at January 31, 2010, was ($3,246,478) and the net loss for the twelve-month period ended January 31, 2010 was ($2,809,843). All of our exploration costs are expensed as incurred.

These consolidated financial statements have been prepared on the going concern basis, which assumes that adequate sources of financing will be obtained as required and that our assets will be realized, and liabilities settled in the ordinary course of business. Accordingly, these consolidated financial statements do not include any adjustments related to the recoverability of assets and classification of assets and liabilities that might be necessary should we be unable to continue as a going concern.

23

In order to continue as a going concern, we require additional financing. There can be no assurance that additional financing will be available to us when needed or, if available, that it can be obtained on commercially reasonable terms. If we are not able to continue as a going concern, we would likely be unable to realize the carrying value of our assets reflected in the balances set out in the preparation of the consolidated financial statements.

Critical Accounting Policies

The consolidated financial statements of Liberty Star Uranium & Metals Corp. have been prepared in conformity with accounting principles generally accepted in the United States of America. Our significant accounting policies are described in Note 2 to the consolidated financial statements included in Item 8 in the Form 10-K. The critical accounting policies adopted by our company are as follows:

Going Concern

Since we have not generated any revenue, we have negative cash flows from operations, and negative working capital we have included a reference to our ability to continue as a going concern in connection with our consolidated financial statements for the period ended January 31, 2010. Our total stockholders’ equity (deficit) at January 31, 2010 was $(3,246,478).

These consolidated financial statements have been prepared on the going concern basis, which assumes that adequate sources of financing will be obtained as required and that our assets will be realized, and liabilities settled in the ordinary course of business. Accordingly, these consolidated financial statements do not include any adjustments related to the recoverability of assets and classification of assets and liabilities that might be necessary should we be unable to continue as a going concern.

Mineral claims

We account for costs incurred to acquire, maintain and explore mineral properties as charged to expense in the period incurred until the time that a proven mineral resource is established at which point development of the mineral property would be capitalized. Currently, the company does not have any proven mineral resources on any of its mineral properties.

Convertible promissory notes

We reviewed the convertible promissory notes and the related subscription agreements to determine the appropriate reporting within the financial statements. We report convertible promissory notes as liabilities at their carrying value less unamortized discounts in accordance with the applicable accounting guidance. We bifurcates conversion options and detachable common stock purchase warrants and reports them as liabilities at fair value at each reporting period when required in accordance with the applicable accounting guidance. We determined that reporting the notes as equity would not be appropriate as the conversion of the notes into common stock was not guaranteed. No gain or loss is reported when the notes are converted into shares of our common stock in accordance with the note’s terms.

Accounting for the impairment of long-lived assets and long-lived assets to be disposed of

The Company reviews property and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell.

Certain drilling equipment, vehicles and prepaid drilling supplies have been impaired and an impairment loss of $185,370 was recognized at January 31, 2010. The fair value of the drill rig, vehicles and prepaid drilling supplies was determined using the sales price of this equipment that was sold in a bulk sale in February 2010.

24

New Accounting Pronouncements

With the exception of those discussed below, there have been no recent accounting pronouncements or changes in accounting pronouncements during the twelve months ended January 31, 2010, that are of significance, or potential significance, to us.

In August 2009, the FASB issued guidance clarifying the measurement of liabilities at fair value. This guidance is effective for the first reporting period (including interim periods) beginning after issuance. We do not believe this guidance will have a material impact on its financial position and results of operations.

In January 2010, the FASB issued guidance on improving disclosure of fair value measurements. This guidance is effective for fiscal years beginning after December 15, 2010. We do not believe this guidance will have a material impact on its financial position and results of operations.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk.

Not applicable.

Item 8. Financial Statements.

Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America.

The following consolidated financial statements are filed as part of this annual report:

25

Report of Independent Registered Public Accounting Firm

Board of Directors and Stockholders of
Liberty Star Uranium & Metals Corp.

We have audited the accompanying consolidated balance sheets of Liberty Star Uranium & Metals Corp. (an exploration stage company) as of January 31, 2010 and 2009, and the related consolidated statements of operations, stockholders’ equity (deficit), and cash flows for the years then ended and for the cumulative period from inception (August 20, 2001) through January 31, 2010. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of internal control over financial reporting. Our audits include consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of January 31, 2010 and 2009, and the results of its operations, changes in stockholders’ equity (deficit), and its cash flows for the years then ended, and for the cumulative period from inception (August 20, 2001) through January 31, 2010, in conformity with accounting principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 16 to the consolidated financial statements, the Company is in the exploration stage, has suffered recurring losses from operations, and requires additional funds for further exploratory activity prior to attaining a revenue generating status and is in default on its convertible promissory notes. In addition, the Company may not find sufficient ore reserves to be commercially mined. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 16. The consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties.

/s/ Semple, Marchal & Cooper, LLP
Phoenix, Arizona
May 11, 2010

INDEPENDENT MEMBER OF THE BDO SEIDMAN ALLIANCE

26

LIBERTY STAR URANIUM & METALS CORP.
(AN EXPLORATION STAGE COMPANY)
CONSOLIDATED BALANCE SHEETS

The Accompanying Notes are an Integral Part of the Consolidated Financial Statements

27

LIBERTY STAR URANIUM & METALS CORP.
(AN EXPLORATION STAGE COMPANY)
CONSOLIDATED STATEMENTS OF OPERATIONS

The Accompanying Notes are an Integral Part of the Consolidated Financial Statements

28

LIBERTY STAR URANIUM & METALS CORP.
(AN EXPLORATION STAGE COMPANY)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)

The Accompanying Notes are an Integral Part of the Consolidated Financial Statements

29

LIBERTY STAR URANIUM & METALS CORP.
(AN EXPLORATION STAGE COMPANY)
CONSOLIDATED STATEMENTS OF CASH FLOWS

The Accompanying Notes are an Integral Part of the Consolidated Financial Statements

30

LIBERTY STAR URANIUM & METALS CORP.
(AN EXPLORATION STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 – Organization

Liberty Star Uranium & Metals Corp. (the “Company” or “We” or “Liberty Star”) was formerly Liberty Star Gold Corp. and formerly Titanium Intelligence, Inc. (“Titanium”). Titanium was incorporated on August 20, 2001 under the laws of the State of Nevada. On February 5, 2004 we commenced operations in the acquisition and exploration of mineral properties business. Big Chunk Corp. (“Big Chunk”) is our wholly owned subsidiary and was incorporated on December 14, 2003 in the State of Alaska. Big Chunk is engaged in the acquisition and exploration of mineral properties business in the State of Alaska. Redwall Drilling Inc. (“Redwall”) is our wholly owned subsidiary and was incorporated on August 31, 2007 in the State of Arizona. Redwall is a drilling contractor. On December 1, 2007 Redwall began performing drilling services on the Company’s mineral properties. Redwall ceased drilling activities in July 2008. In April 2007, the Company changed its name to Liberty Star Uranium & Metals Corp. to reflect the Company’s current concentrated efforts on uranium exploration. The Company is considered to be an exploration stage company, as it has not generated any revenues from operations.

In December 2006, the Company entered into a joint venture agreement (“Elle Venture”) with XState Resources Limited (“XState”). The Company holds a 50% interest in the Elle Venture, a general partnership with XState that was formed to explore and, if warranted, develop certain US Federal lode mining claims within the North Pipes Super Project area on the Arizona strip, Northern Arizona. The Elle Venture ceased exploration activities in 2008.

These consolidated financial statements include the results of operations and cash flows of Liberty Star Uranium & Metals Corp. and its wholly owned subsidiaries, Big Chunk and Redwall, from the date of acquisition. All significant intercompany accounts and transactions were eliminated upon consolidation.

These consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America with the on-going assumption that the Company will be able to realize its assets and discharge its liabilities in the normal course of business. However, certain conditions noted below currently exist which raise substantial doubt about the Company’s ability to continue as a going concern. These consolidated financial statements do not include any adjustments to the amounts and classifications of assets and liabilities that might be necessary should the Company be unable to continue as a going concern. The operations of the Company have primarily been funded by the issuance of common stock and debt. Continued operations of the Company are dependent on the Company’s ability to complete equity financings or generate profitable operations in the future. Management’s plan in this regard is to secure additional funds through future equity financings or loans. Such financings or loans may not be available, may not be available on reasonable terms, or the Company may be prevented from obtaining further financings because of restrictions that apply to it pursuant to the Unsecured Convertible Promissory Notes discussed in Note 6.

NOTE 2 – Summary of significant accounting policies

The summary of significant accounting policies presented below is designed to assist in understanding the Company's consolidated financial statements. Such consolidated financial statements and accompanying notes are the representations of the Company’s management, who is responsible for their integrity and objectivity. These accounting policies conform to accounting principles generally accepted in the United States of America (“GAAP") in all material respects, and have been consistently applied in preparing the accompanying consolidated financial statements. The significant accounting policies adopted by the Company are as follows:

Use of estimates

The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.

31

LIBERTY STAR URANIUM & METALS CORP.
(AN EXPLORATION STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - continued

NOTE 2 – Summary of significant accounting policies - continued

Use of estimates - continued

The valuation of stock-based compensation, valuation of common stock purchase warrants, value of embedded conversion options, value of beneficial conversion features, valuation allowance on deferred tax assets, and the determination of useful lives and recoverability of depreciable assets are significant estimates made by management. It is at least reasonably possible that a change in these estimates may occur in the near term.

Principles of consolidation

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Big Chunk and Redwall, from the date of acquisition, February 5, 2004 and August 31, 2007, respectively. All significant intercompany accounts and transactions have been eliminated upon consolidation.

Cash and cash equivalents

The Company considers cash held at banks and all highly liquid investments with original maturities of three months or less to be cash and cash equivalents. The Company maintains its cash in bank deposit accounts which, for periods of time, may exceed federally insured limits. At January 31, 2010 and 2009, the Company did not hold cash in bank deposit accounts that exceeded federally insured limits.

Mineral claim costs

Mineral claim costs of carrying, retaining and developing properties are charged to expense in the period incurred in our geological and geophysical costs.

Property and equipment

Property and equipment is stated at cost. The Company capitalizes all purchased equipment over $500 with a useful life of more than one year. Depreciation is calculated using the straight line method over the estimated useful lives of the assets. Leasehold improvements are stated at cost and are amortized over their estimated useful lives or the lease term, whichever is shorter. Maintenance and repairs are expensed as incurred while betterments or renewals are capitalized. Property and equipment is reviewed periodically for impairment. The estimated useful lives range from 2 to 7 years.

Convertible promissory notes

The Company reports convertible promissory notes as liabilities at their carrying value less unamortized discounts, which approximates fair value. The Company bifurcates conversion options and detachable common stock purchase warrants and reports them as liabilities at fair value at each reporting period when required in accordance with the applicable accounting guidance. When convertible promissory notes are converted into shares of the Company’s common stock in accordance with the debt’s terms, no gain or loss is recognized. The Company accounts for inducements to convert as an expense in the period incurred, included in debt conversion expense.

Accounting for the impairment of long-lived assets and long-lived assets to be disposed of

The Company reviews property and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell.

32

LIBERTY STAR URANIUM & METALS CORP.
(AN EXPLORATION STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - continued

NOTE 2 – Summary of significant accounting policies - continued

Environmental expenditures

The operations of the Company have been and may in the future be affected from time to time in varying degree by changes in environmental regulations, including those for future removal and site restoration costs. The likelihood of new regulations and their overall effect upon the Company are not predictable. The Company will provide for any reclamation costs in accordance with the accounting standards codification section 360-35. It is management’s opinion that the Company is not currently exposed to significant environmental and reclamation liabilities and has recorded no reserve for environmental and reclamation expenditures at January 31, 2010 and 2009.

Income taxes

Income taxes are recorded using the asset and liability method. Under the asset and liability method, tax assets and liabilities are recognized for the tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Future tax assets and liabilities are measured using the enacted tax rates expected to apply when the asset is realized or the liability settled. The effect on future tax assets and liabilities of a change in tax rates is recognized in income in the period that enactment occurs. To the extent that the Company does not consider it more likely than not that a future tax asset will be recovered, it provides a valuation allowance against the excess. Interest and penalties associated with unrecognized tax benefits, if any, are classified as additional income taxes in the statement of operations. With few exceptions, the Company is no longer subject to U.S. federal, state and local examinations by tax authorities for years before 2008.

Net loss per share

Basic net loss per share is computed by dividing net loss attributable to common shareholders by the weighted average number of shares of common stock outstanding during the period. The calculation of basic loss per share gives retroactive effect to an eight for one forward stock split on January 6, 2004 which resulted in 20,000,000 common shares outstanding. The calculation of basic loss per share gives retroactive effect to a one for four reverse stock split on September 1, 2009 which resulted in 67,261,764 common shares outstanding. Diluted net loss per share takes into consideration shares of common stock outstanding (computed under basic loss per share) and potentially dilutive shares of common stock that are not anti-dilutive. At January 31, 2010 and 2009, there were 62,260,338 and 3,498,638, respectively, potentially dilutive instruments outstanding. Additionally, at January 31, 2010 and 2009 if settlement of the Convertible Promissory Notes were completed by the issuance of common shares there would be 2,021,513,000 and 1,886,792,667 shares, respectively, required to convert the notes which is in excess of our authorized shares. At January 31, 2010 and 2009 there are 1,250,000,000 and 50,000,000 shares authorized, respectively. These instruments were not included in the determination of diluted loss per share as their effect was anti-dilutive.

Recently issued accounting standards

With the exception of those discussed below, there have been no recent accounting pronouncements or changes in accounting pronouncements during the twelve months ended January 31, 2010, that are of significance, or potential significance, to us.

In August 2009, the FASB issued guidance clarifying the measurement of liabilities at fair value. This guidance is effective for the first reporting period (including interim periods) beginning after issuance. The Company does not believe this guidance will have a material impact on its financial position and results of operations.

In January 2010, the FASB issued guidance on improving disclosure of fair value measurements. This guidance is effective for fiscal years beginning after December 15, 2010. The Company does not believe this guidance will have a material impact on its financial position and results of operations.

33

LIBERTY STAR URANIUM & METALS CORP.
(AN EXPLORATION STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – continued

NOTE 3– Mineral claims

At January 31, 2010 the Company held a 100% interest in 1,775 standard Federal lode mining claims spanning approximately 60 square miles on the Colorado Plateau Province of Northern Arizona (the “North Pipes Claims”).

At January 31, 2010 the Company held a 50% interest in standard Federal lode mining claims covering 3 breccia pipe targets on the Colorado Plateau Province of Northern Arizona. These claims are owned through the Elle Venture, a general partnership in which the Company is a 50% partner.

At January 31, 2010 the Company held an option to explore 59 standard Federal lode mining claims located at the East Silver Bell and Walnut Creek region of Arizona. The mineral claims are owned by JABA US Inc, an Arizona Corporation in which two directors of the Company are owners.

At January 31, 2010 the Company held a 100% interest in 707 Alaska State mining claims spanning approximately 177 square miles in the Iliamna region of Southwestern Alaska, located on the north side of the Cook Inlet, approximately 200 miles southwest of the city of Anchorage, Alaska (the “Big Chunk Claims”).

At January 31, 2010 the Company held a 100% interest in 56 Alaska State mining claims spanning approximately 13.5 square miles in the Iliamna region of Southwestern Alaska, located on the north side of the Cook Inlet approximately 60 miles north of Lake Iliamna (the “Bonanza Hills Claims”).

Title to mineral claims involves certain inherent risks due to difficulties of determining the validity of certain claims as well as potential for problems arising from the frequently ambiguous conveyancing history characteristic of many mineral properties. The Company has investigated titles to all its mineral properties and, to the best of its knowledge; titles to all properties are in good standing as of January 31, 2010.

NOTE 4 – Property and equipment

The balances of our major classes of depreciable assets are:

Certain drilling equipment, vehicles and prepaid drilling supplies have been impaired and an impairment loss of $185,370 was recognized at January 31, 2010. The fair value of the drill rig, vehicles and prepaid drilling supplies was determined using the sales price of this equipment that was sold in a bulk sale in February 2010.

NOTE 5 – Long-term debt

Notes payable to Chase Bank payable in aggregate monthly installments of $1,302 including interest at fixed rates of 8.9% maturing at various dates through February 2013, secured by liens on vehicles. Principal balances at January 31, 2010 and 2009 are $37,742 and $61,925, respectively. Carrying amount of vehicles that serve as collateral is $27,923 and $73,793 at January 31, 2010 and 2009, respectively.

34

LIBERTY STAR URANIUM & METALS CORP.
(AN EXPLORATION STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - continued

NOTE 5 – Long-term debt - continued

Note payable to Atlas Copco payable in monthly installments of $5,436 including interest at a fixed rate of 9% through maturity in September 2010, secured by a lien on equipment. Principal balance at January 31, 2010 and 2009 is $80,889 and $95,937, respectively. Carrying amount of equipment that serves as collateral is $220,445 and $298,250 at January 31, 2010 and 2009, respectively.

The following is a summary of the principal maturities of long-term debt during the next five years:

NOTE 6 – Convertible promissory notes

The Company issues convertible promissory notes in private placements of its securities to institutional investors pursuant to exemptions from registration set out in Rule 506 of Regulation D under the Securities Act of 1933. The convertible notes were issued in May 2007, August 2008, May 2009 and August 2009. The Company issued detachable common stock purchase warrants with the May 2007 and August 2009 convertible notes. Detachable common stock purchase warrants were reported at fair value as discounts on the convertible notes. Discounts on the convertible notes were also recorded for the beneficial conversion features. At January 31, 2010 there were 5.3 months of amortization remaining on the discounts.

If settlement of all of the Convertible Notes occurred on January 31, 2010 the Company would have been obligated to pay $3,209,958 principal payments and $316,233 accrued interest for a total of $3,526,191 in cash plus an additional 10% of the principal balance of $320,996 required for cash payments. If the settlement were completed by the issuance of common shares the additional 10% of the principal balance is not due. The conversion price at January 31, 2010 for the May 2007, August 2008 and May 2009 notes would have been $0.0018 per share and the conversion price at January 31, 2010 for the August 2009 notes would have been $0.0017 for a total of 2,021,513,000 shares required to convert the notes.

May 2007 Convertible Notes:

On May 11, 2007, the Company issued senior unsecured convertible two year promissory notes (“May 2007 Convertible Notes”) for gross proceeds of $4,400,000 in a private placement of its securities to institutional investors pursuant to exemptions from registration set out in Rule 506 of Regulation D under the Securities Act of 1933. The net proceeds received after placement agent fee, due diligence fee and legal fees was $4,010,238. On November 17, 2008 the Company did not have enough authorized capital to fulfill the conversion requests received from the holders of the May 2007 Convertible Notes and became in default on the notes. The default interest rate on the notes increased to 15%. The notes matured on May 11, 2009 and have not been paid in full. The entire obligation is due on demand and included as a current liability.

35

LIBERTY STAR URANIUM & METALS CORP.
(AN EXPLORATION STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – continued

NOTE 6 – Convertible promissory notes - continued

May 2007 Convertible Notes - continued:
The Company may elect to make repayments of the May 2007 Convertible Notes in cash at 110% of the principal amount due and 100% of the other amounts then due or by the issuance of common stock of the Company. The holders may elect to convert amounts owed on the notes at a conversion price which is the lesser of the fixed conversion price of $0.005 per share or 80% of the average of the closing bid prices of the common stock for the five trading days prior to the conversion date.

August 2008 Convertible Notes:
On August 27, 2008 the Company issued Secured Convertible Promissory one year notes (“August 2008 Convertible Notes”) for gross proceeds of $414,184 to the holders of the May 2007 Convertible Notes in a private placement of its securities to institutional investors pursuant to exemptions from registration set out in Rule 506 of Regulation D under the Securities Act of 1933. The net proceeds received were $372,434. The August 2008 Convertible Notes bear interest at 12%. In November 2008, the Company did not have enough authorized shares available for issuance to make any stock repayments on this note and was considered in default. The default interest rate increased to 15%. The notes matured on August 27, 2009 and have not been paid in full. The entire obligation is due on demand and included as a current liability.

The Company may elect to make repayments of the August 2008 Convertible Notes in cash at 110% of the principal amount due and 100% of the other amounts then due or by the issuance of common stock of the Company. The holders may elect to convert amounts owed on the notes at a conversion price which is the lesser of the fixed conversion price of $0.005 per share or 80% of the average of the closing bid prices of the common stock for the five trading days prior to the conversion date.

May 2009 Convertible Notes:
On May 21, 2009, the Company completed the sale of $170,668 principal amount of 12% Secured Convertible Promissory Notes (“May 2009 Convertible Notes”) in a private placement of its securities to subscribers pursuant to the exemption from registration under the United States Securities Act of 1933 provided by Section 4(2), Section 4(6) and/or Rule 506 of Regulation D promulgated under the 1933 Act, each of which represented that they are “accredited investors” within the respective meanings ascribed to that term in Rule 501(a) under the Securities Act of 1933 and pursuant to the terms of a subscription agreement between the parties dated May 21, 2009. The net proceeds received were $157,468. The notes mature on May 21, 2010. The Company does not have enough authorized shares available for issuance to make full stock repayment on this note and is considered in default.

Pursuant to the terms of the convertible secured notes and the Subscription Agreement, interest accrues on the Notes at a rate of 12% per annum commencing on the date of the issuance of the May 2009 Convertible Notes. The May 2009 Convertible Notes principal must be repaid commencing October 15, 2009 in monthly amounts equal to 14.28% of the principal amount of the notes together with interest, accrued to each monthly payment date on the outstanding note principal. As required payments have not been made as of October 31, 2009 the note currently accrues interest at the default rate of 15%. In the event a registration statement is effective or Common Stock may be immediately resold by the noteholders without volume or other restrictions, and an event of default is not pending then the Company may pay the monthly amount with registered or unregistered common stock valued at the lesser of the fixed conversion price of $0.005 (subject to certain adjustments), or 80% of the average of the closing bid prices of the Company’s common stock for the five trading days prior to the monthly payment date. The Company may, in any event, elect to pay the monthly amount in cash at 110% of the principal amount due and 100% of all other amounts then due. The Company must provide 10 days notice of whether payment will be made in cash or with stock. If the notice is not timely given, the noteholders shall have the option to elect to be paid in cash or common stock. Each monthly payment in kind will be limited to not more than 33% of the aggregate daily trading volume of the common stock for the 7 trading days preceding the relevant monthly payment date. The Company agreed to reserve for issuance to the subscribers not less than 175% of the amount of shares of common stock necessary to allow conversion of all notes at the conversion price in effect from time to time.

36

LIBERTY STAR URANIUM & METALS CORP.
(AN EXPLORATION STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – continued

NOTE 6 – Convertible promissory notes – continued

May 2009 Convertible Notes - continued:
Pursuant to the terms of the Subscription Agreement, James Briscoe, the CEO of the Company, agreed not to sell or otherwise dispose of his shares of common stock of the Company owned by him or which he has the right to acquire for a period of two years from the date of the Subscription Agreement, unless sold in the open market for over $0.90 per share.

August 2009 Convertible Notes:
On August 14, 2009, the Company completed the sale of $589,177 principal amount of 12% Secured Convertible Promissory Notes (“August 2009 Convertible Notes”) to five subscribers pursuant to the exemption from registration under the United States Securities Act of 1933 provided by Section 4(2), Section 4(6) and/or Rule 506 of Regulation D promulgated under the 1933 Act, each of which represented that they are “accredited investors” within the respective meanings ascribed to that term in Rule 501(a) under the Securities Act of 1933 and pursuant to the terms of a subscription agreement between the parties dated August 14, 2009. On November 27, 2009, we modified the August 2009 Convertible Notes so as to increase five such notes by an aggregate total of $206,075. Other aspects of the August 14, 2009 notes remain unchanged. The net proceeds received were $766,015. The notes mature on August 14, 2010. The Company does not have enough authorized shares available for issuance to make full stock repayment on this note and is considered in default.

Pursuant to the terms of the convertible secured notes and the Subscription Agreement, interest accrues on the Notes at a rate of 12% per annum commencing on the date of the issuance of the August 2009 Convertible Notes. The August 2009 Convertible Notes principal must be repaid commencing February 15, 2010 in monthly amounts equal to 20% of the principal amount of the notes together with interest, accrued to each monthly payment date on the outstanding note principal. In the event a registration statement is effective or Common Stock may be immediately resold by the noteholders without volume or other restrictions, and an event of default is not pending then the Company may pay the monthly amount with registered or unregistered common stock valued at the lesser of the fixed conversion price of $0.0025 (subject to certain adjustments), or 75% of the average of the closing bid prices of the Company’s common stock for the five trading days prior to the monthly payment date. The Company may, in any event, elect to pay the monthly amount in cash at 110% of the principal amount due and 100% of all other amounts then due. The Company must provide 10 days notice of whether payment will be made in cash or with stock. If the notice is not timely given, the noteholders shall have the option to elect to be paid in cash or common stock. Each monthly payment in kind will be limited to not more than 40% of the aggregate daily trading volume of the common stock for the 5 trading days preceding the relevant monthly payment date. The Company agreed to reserve for issuance to the subscribers not less than 175% of the amount of shares of common stock necessary to allow conversion of all notes at the conversion price in effect from time to time.

The holders of the August 2009 Convertible Notes were issued 58,917,700 detachable common stock purchase warrants with an exercise price of $0.00125 and a life of 6 years. The exercise price may be adjusted if the Company issues other shares, warrants or stock options before the expiration of the warrants at a price less than $0.005 per share. The detachable common stock purchase warrants are reported as a liability at fair value. The Company estimates the fair value of warrants using the Black-Scholes valuation model, a level three fair value hierarchy. To estimate the fair value of the warrants, the Company used the following assumptions: 90% expected volatility; 0% expected dividend yield; 1 year expected term; and 0.40% risk-free interest rate. The balance of warrant liability was $30,422 and $0 at January 31, 2010 and 2009, respectively.

37

LIBERTY STAR URANIUM & METALS CORP.
(AN EXPLORATION STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – continued

NOTE 6 – Convertible promissory notes – continued

August 2009 Convertible Notes - continued:
The Company agreed to include at the option of each noteholder of the May 2009 and August 2009 notes the number of shares that may be converted pursuant to any note in any registration statement it files during such period, ahead of the rights granted to the subscribers in the May 2007 Convertible Notes and the subscribers in the August 2008 Convertible Notes. Noteholders are subject to certain limitations on their rights to convert the notes. The principal limitation is that unless waived, the holder may not, with certain limited exceptions, convert into a number of shares that would, together with other shares held by the holder, exceed 4.99% of the then outstanding shares of the Company after such conversion.

Provisions applicable to all convertible notes:
The entire principal and interest of the May 2007, August 2008, May 2009 and August 2009 notes will be payable upon the Company’s receipt of the net proceeds of a $3,000,000 offering of the Company’s debt or equity. Provided an event of default is not pending, the Company may prepay unconverted portions of the Note upon 20 days prior notice during which time noteholders may convert the amount of the note noticed for prepayment at the fixed conversion price. Such payment shall be equal to 125% of the principal amount being prepaid and the accrued interest. In the event that commencing on the date that is six months following the closing date and ending two years thereafter, Rule 144 is unavailable for the unrestricted resale of the conversion shares under the Notes, then the Company shall pay to the investor as liquidated damages for each thirty days (or pro rata for periods shorter than thirty days) a sum equal to 1.75% of the purchase price of the outstanding notes.

The Company granted a senior security interest over all of the assets of the Company to the holders of the May 2007, August 2008, May 2009 and August 2009 Convertible Notes. In addition, the Company’s wholly owned subsidiary, Big Chunk Corp. was required to provide the subscribers with a guaranty on the repayment of the loans.

NOTE 7 – Common stock

The common shares of the Company are all of the same class, are voting and entitle stockholders to receive dividends as defined. Upon liquidation or wind-up, stockholders are entitled to participate equally with respect to any distribution of net assets or any dividends that may be declared.

The Company’s shareholders approved the increase in authorized capital of the Company from 200,000,000 to 10,000,000,000 shares of common stock with $0.001 par value during a vote held at our annual meeting on May 27, 2009. The Company filed a certificate of amendment on June 4, 2009 with the Nevada Secretary of State to increase the number of authorized shares to 5,000,000,000 shares of common stock with a par value of $0.001.

On September 1, 2009 the Company effected a one for four reverse stock split of our authorized and issued and outstanding common stock. As a result our authorized capital decreased to 1,250,000,000 shares of common stock with a par value of $0.00001. Our stock is traded under a new symbol LBSR as of the opening of trading on September 1, 2009.

As of January 31, 2010, there were 61,180,463 whole share purchase warrants outstanding and exercisable. The warrants have a weighted average remaining life of 5.4 years and a weighted average exercise price of $0.005 per whole warrant for one common share.

38

LIBERTY STAR URANIUM & METALS CORP.
(AN EXPLORATION STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – continued

NOTE 7 – Common stock - continued

Whole share purchase warrants outstanding at January 31, 2010 are as follows (adjusted for 1 for 4 reverse stock split):

NOTE 8 – Stock-based compensation

The stock based compensation disclosures reflect the retroactive effect of the 1 for 4 reverse stock split effected on September 1, 2009. The 2007 Stock Option Plan was approved and adopted by the Board of Directors on December 10, 2007. The plan allows for up to 2,500,000 shares to be granted to key employees and non-employee consultants after specific objectives are met. The 2004 Stock Option Plan was approved and adopted by the Board of Directors on December 27, 2004. The plan allows for up to 962,500 shares to be granted to key employees and non-employee consultants after specific objectives are met. Employees can receive incentive stock options and non-qualified stock options while non-employee consultants can receive only non-qualified stock options. The options granted vest under various provisions using graded vesting, not to exceed four years. The options granted have a term not to exceed ten years from the date of grant or five years for options granted to more than 10% stockholders. The option price set by the Plan Administration shall not be less than the fair market value per share of the common stock on the grant date or 110% of the fair market value per share of the common stock on the grant date for options granted to greater than 10% stockholders. Options remaining available for grant under the 2007 Stock Option Plan at January 31, 2010 and 2009 are 2,056,250 and 1,943,750, respectively. Options remaining available for grant under the 2004 Stock Option Plan at January 31, 2010 and 2009 are 326,375 and 282,875, respectively.

On May 21, 2008 the Company granted 106,250 non-qualified stock options to non-employee consultants and 762,500 incentive stock options to employees, officers and directors. The options have an exercise price of $0.055 per option. On June 26, 2008 the board eliminated the vesting period so the options would be fully vested effective on that date. The options have a life of ten years.

The following tables summarize the Company’s stock option activity under the 2007 and 2004 Stock Option Plans during the year ended January 31, 2010.

Incentive stock options to employees outstanding at January 31, 2010 are as follows:

39

LIBERTY STAR URANIUM & METALS CORP.
(AN EXPLORATION STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - continued

NOTE 8 – Stock-based compensation – continued

Non-qualified stock options to non-employee consultants outstanding at January 31, 2010 are as follows:

The aggregate intrinsic value is calculated based on the January 29, 2010 stock price of $0.00231 per share.

As of January 31, 2010 and 2009 there were no nonvested stock options. During the year ended January 31, 2010 there were no nonvested stock options granted, forfeited, vested or cancelled. The weighted average grant date fair value of options vested during the twelve months ended January 31, 2010 was $0.

The Company estimates the fair value of option awards on the grant date using the Black-Scholes valuation model. The Company uses historical volatility as its method to estimate expected volatility. The Company used the following assumptions to estimate the fair value of stock option grants:

The weighted average grant date fair value of the options granted during the year ended January 31, 2009 was $0.10 per option, respectively. There were no options exercised during the years ended January 31, 2010 and 2009 and the period from inception (August 20, 2001) to January 31, 2010.

Share-based compensation expense is reported in our statement of operations as follows:

At January 31, 2010 there is no unrecognized share-based compensation for all share-based awards outstanding.

40

LIBERTY STAR URANIUM & METALS CORP.
(AN EXPLORATION STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – continued

NOTE 9 – Income taxes

As of January 31 the deferred tax asset is as follows:

Management has elected to provide a deferred tax asset valuation allowance equal to the potential benefit due to the Company’s history of losses. If the Company demonstrates the ability to generate taxable income, management will reevaluate the allowance. The change in the valuation allowance of $925,000 and $1,579,000 in the years ended January 31, 2010 and 2009 primarily represents the benefit of the change in net operating loss carry-forwards during the period.

The Company has federal and state net operating loss carry-forwards that are available to offset future taxable income. The schedule below shows the amounts and expiration dates for the net operating loss carry-forwards.

A reconciliation between the provision for income taxes and the expected tax benefit using the federal statutory rate of 34% for the years ended January 31, 2010 and 2009 is as follows:

41

LIBERTY STAR URANIUM & METALS CORP.
(AN EXPLORATION STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – continued

NOTE 10 – Related party transactions

The Company entered into the following transactions with related parties during the year ended January 31, 2010:

Paid or accrued $5,512 in rent. We rented an office from an officer on a month-to-month basis for $459 per month.

Accrued $99,500 of unpaid wages to Jim Briscoe our President and CEO.

The Company entered into the following transactions with related parties during the year ended January 31, 2009:

Paid or accrued $5,552 in rent. We rented an office from an officer on a month-to-month basis for $459 per month.

Accrued $42,500 of unpaid wages to Jim Briscoe our President and CEO.

Receivable of $1,888 from Jim Briscoe our President and CEO, the receivable is due on demand and is non-interest bearing.

During the year ended January 31, 2009, the Company incurred $599,566 for reimbursement of subcontracting costs from the Elle Venture, a general partnership in which the Company is a 50% partner, pursuant to the subcontracting agreement to perform the duties as the Manager of the Elle Venture. Subcontracting costs reimbursed from Elle Venture are reported as a reduction of our geological and geophysical exploration costs.

The Company entered into an option agreement in April 2008 with JABA US Inc. an Arizona Corporation in which two directors of the Company are owners of JABA US Inc. The option agreement grants the Company the exclusive right and option to acquire a 100% undivided interest in 26 Federal lode mining claims in the East Silver Bell area northwest of Tucson, AZ, 33 Federal lode mining claims in the Walnut Creek area near Tombstone, AZ, and 2 private parcels in the Beatty area of Nevada. In the event that there is a commencement of commercial production a royalty ranging from 2% to 10% of net smelter returns will be payable to JABA US Inc. The Company is required to maintain the claims in good standing and pay the annual rentals of up to $8,000 during the option period which ends no later than January 1, 2011. The Company agrees to make $175,000 in exploration expenditures on or before dates to be determined by the Company, but no later than January 1, 2011. During the year ended January 31, 2009 annual rentals of $7,375 were paid to extend the life of the 33 Federal lode mining claims through September 2009.

The Company owns common stock in Mayo Gold Explorations, a privately owned corporation in which our President and CEO is a board member. The investment is recorded on the cost method. At January 31, 2009 the investment balance is $25,000 and is reported on the balance sheet as other assets.

NOTE 11 – Commitments

The Company is required to perform annual assessment work in order to maintain the Big Chunk and Bonanza Hills Alaska State mining claims. If annual assessment work is not performed the Company must pay the assessment amount in cash in order to maintain the claims. Completion of annual assessment work in the amount of $400 per ¼ section (160 acre) claim or $100 per ¼ -¼ section (40 acre) claim extends the claims for a one-year period from the staking of claims. Assessment work performed in excess of the required amount may be carried forward for up to four years to satisfy future obligations. The Company estimates that the required annual assessments to maintain the claims will be approximately $298,600.

The annual state rentals for the Big Chunk and Bonanza Hills Alaska State mining claims vary from $70 to $280 per mineral claim. The rental period begins at noon September 1^st through the following September 1^st and annual rental payments are due on November 30^th of each year. Annual rent is due in full within 45 days of staking a new claim and covers the period from staking until the next September 1^st. Claims that are staked in accordance with AS 38.05.195(b)(1) meridian, township, range, section and claim system location “MTRSC” receive a one-time only credit of 50% of the second year’s rent payment. Our Alaska claims are all MTRSC claims eligible for the 50% rental credit in the second rental year. Rentals for the period from September 1, 2009 through September 1, 2010 of $202,440 have been paid. The estimated state rentals due by November 30, 2010 for the period from September 1, 2010 through September 1, 2011 are $202,440. Alaska State production royalty is three percent of net income. State law prescribes that after a 3.5 -year exemption from state taxes a metal mine is liable for a 15% state licensing tax on net income from the mine.

42
LIBERTY STAR URANIUM & METALS CORP.
(AN EXPLORATION STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - continued

NOTE 11 – Commitments - continued

The Company is required to pay annual rentals for its Federal lode mining claims for the North Pipes project in the State of Arizona. The rental period begins at noon on September 1^st through the following September 1^st and rental payments are due by the first day of the rental period. The annual rental was $125 per claim and increased to $140 per claim beginning September 1, 2009. Additional fees of $45 per claim are due in the first year of filing a Federal lode mining claim along with the first year’s rent. Rentals due for the period from September 1, 2009 to September 1, 2010 of $250,460 have been paid. The estimated rentals due by September 1, 2010 for the period from September 1, 2010 through September 1, 2011 are $250,460.

In November 2006, the Company began renting its previous office space. The lease requires monthly payments of $3,825. In September 2008 the Company exercised its option to renew the lease for an additional two years. During the year ended January 31, 2010 and 2009 the Company recognized rent expense of $29,424 and $45,468, respectively, related to this lease. In January 2009 the Company vacated the premises. The landlord has not released the Company from its obligations related to the two year renewal and the Company is responsible for any shortage in rent received from a new tenant and the $3,825 that the Company would have paid per month during the renewal period. Future minimum lease payments under this noncancelable lease for the twelve months ended January 31, 2011 are $8,256. At January 31, 2010 the landlord has asserted a claim against the Company for damages of $48,909 related to this lease. At January 31, 2010 the Company has a balance of $36,292 in accounts payable related to this lease.

NOTE 12 – Supplemental disclosures with respect to cash flows

The significant non-cash investing and financing transactions for the twelve month period ended January 31, 2010 were as follows:

Issued 199,170,302 shares of common stock as repayment of $513,685 principal portion and $91,968 interest portion of the monthly payments on the convertible notes.

Issued 58,917,700 detachable common stock purchase warrants to the investors who purchased the August 2009 convertible notes recorded at fair value as a discount on convertible promissory notes of $38,349.

Deferred financing charges of $42,437 were deducted from the proceeds we received on the sale of August 2009 Convertible Notes.

Recorded $330,366 of discounts on convertible promissory notes for beneficial conversion features.

The significant non-cash investing and financing transactions for the twelve month period ended January 31, 2009 were as follows:

Issued 7,500 shares of common stock valued at $9,000 of debt conversion expense to investors who participated in the first modification agreement to the May 2007 Convertible Notes.

Issued 37,646,325 shares of common stock as repayment of $1,520,234 principal portion and $319,277 interest portion of the monthly payments on the May 2007 Convertible Notes.

Recorded $94,437 of debt conversion expense for additional discount to original conversion price extended to the holders of the May 2007 Convertible Notes as an inducement to convert.

Recorded $67,700 additional discount on the May 2007 Convertible Notes for the reduction in the exercise price of the detachable stock purchase warrants.

Stock option compensation recorded at $576,244 for options issued to employees and consultants.

Reported $25,000 of other income from the receipt of 100,000 shares of common stock included in “Other assets” in the accompanying financial statements from NPX Metals Inc. for assignment of our rights to the exploration of the Beatty claims pursuant to our option agreement with JABA US, Inc.

Deferred financing charges of $41,750 were deducted from the proceeds we received on the sale of August 2008 Convertible Notes.

43
LIBERTY STAR URANIUM & METALS CORP.
(AN EXPLORATION STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – continued

NOTE 13 – Segment information

The Company's operations were conducted in one reportable segment, being the acquisition and exploration of mineral claims, in the United States of America.

NOTE 14 – Fair value of financial instruments

The Company's financial instruments consist of cash and cash equivalents, accounts payable, accrued liabilities, convertible notes payable, notes payable, and warrant liability. It is management's opinion that the Company is not exposed to significant interest, currency or credit risks arising from these financial instruments. The fair value of these financial instruments approximates their carrying values. Gains and losses recognized on changes in fair value of financial instruments are reported in other income (expense) as gain (loss) on change in fair value.

The Company estimates the fair value of level 3 inputs using the Black-Scholes valuation model. The Company uses historical volatility as its method to estimate expected volatility. The Company used the following assumptions to estimate the fair value of warrant liability at January 31, 2010:

NOTE 15 – Subsequent Events

The Company issued 109,370,577 shares of common stock for conversions of $127,264 of principal and $24,905 of accrued interest on the Convertible Notes.

On February 10, 2010 the Company sold the drill rig and other drilling equipment and supplies in a bulk sale. The drill rig was pledged as collateral on the Atlas Copco loan and the convertible promissory notes. The Atlas Copco loan was paid in full.

On February 25, 2010 the Company entered into an extension and modification of the convertible promissory notes. The maturity date of each note is extended to February 28, 2011 with two 180 day extensions exercisable at the option of the holder.

On April 23, 2010 the Company issued 76,400,000 shares of common stock to directors and consultants for services rendered.

The company has evaluated subsequent events through May 11, 2010 which is the date the financial statements were issued.

44
LIBERTY STAR URANIUM & METALS CORP.
(AN EXPLORATION STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – continued

NOTE 16 – Going concern

The Company is in the exploration stage, has incurred losses from operations, requires additional funds for further exploratory activity and to maintain its claims prior to attaining a revenue generating status, and is in default on its convertible promissory notes. There are no assurances that a commercially viable mineral deposit exists on any of our properties. In addition, the Company may not find sufficient ore reserves to be commercially mined. As such, the Company's auditors have expressed an uncertainty about the Company's ability to continue as a going concern in their opinion attached to our audited financial statements for the fiscal year ended January 31, 2010.

Management is working to secure additional funds through the exercise of stock warrants already outstanding, equity financings or joint venture agreements. The consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties.

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Item 9.        Changes In and Disagreements With Accountants on Accounting and Financial Disclosure.

During the two most recent fiscal years, and in the subsequent interim periods, there were no disagreements with Semple, Marchal & Cooper, LLP on any matters of accounting principles or practices, financial statement disclosure, or auditing scope and procedures which, if not resolved to the satisfaction of Semple, Marchal & Cooper, LLP would have caused Semple, Marchal & Cooper, LLP to make reference to the matter in their report.

Item 9A(T).  Controls and Procedures.

As required by Rule 13a-15 under the Exchange Act, our management has evaluated the effectiveness of the design and operation of our disclosure controls and procedures at January 31, 2010, which is the end of the period covered by this report. This evaluation was carried out by our management with the participation of our principal executive officer and principal financial officer, Mr. James Briscoe. Based on this evaluation, our management, including our chief executive officer and chief financial officer, concluded that the design and operation of our disclosure controls and procedures were effective as of the end of the period covered by this report.

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed by our company in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by our company in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

Management's Report on Internal Control over Financial Reporting

Management of our company is responsible for establishing and maintaining adequate internal control over financial reporting for the company, as such term is defined in the Securities Exchange Act Rule 13a-15(f). Our principal financial officer and principal executive officer, Mr. James Briscoe conducted an evaluation of the effectiveness of our internal control over financial reporting as of January 31, 2010 as required by the Securities Exchange Act of 1934 Rule 13a-15(c). In making this assessment, our principal financial officer and principal executive officer used the criteria set forth in the framework in “Internal Control – Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on the evaluation conducted under the framework in “Internal Control – Integrated Framework.” our principal financial officer and principal executive officer concluded that our company’s internal control over financial reporting was effective, as of January 31, 2010, in providing reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

This report does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our company’s independent registered public accounting firm pursuant to temporary rules of the SEC that permit our company to provide only management’s report in this Annual Report on Form 10-K.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting or in other factors that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting in our most recent fiscal quarter.

Item 9B.    Other Information.

None.

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PART III

Item 10.      Directors, Executive Officers and Corporate Governance.

All directors of our company hold office until the next annual meeting of the stockholders or until their successors have been elected and qualified. The officers of our company are appointed by our board of directors and hold office until their death, resignation or removal from office. Our directors, executive officers and significant employees, their ages, positions held, and duration as such, are as follows:

James Briscoe - Chief Executive Officer, Chief Financial Officer, President, Chairman of the Board and Director

Mr. Briscoe was appointed as our Chief Executive Officer, President, Chairman and a director on February 3, 2004. Mr. Briscoe became the interim Chief Financial Officer on July 31, 2008. Mr. Briscoe is a Registered Professional Geologist in the states of Arizona and California. From 1996 to April 2005, Mr. Briscoe was the Vice President of Exploration, and Chairman of the Board of JABA Exploration Inc., a TSX Venture Exchange Canadian public company. Mr. Briscoe was also the President, Chief Executive Officer and a Geologist of JABA (US) Inc. and President of Compania Minera JABA, S.A. de C.V. in Mexico. Compania Minera JABA, S.A. de C.V. is no longer active and is in the process of dissolution. During the periods of time indicated below, Mr. Briscoe served in the positions listed for the following two Canadian public companies:

We believe Mr. Briscoe is qualified to serve on our board of directors because of his knowledge of our company’s history and current operations, which he gained from working for our company as described above, in addition to his education and business experience as described above.

Gary Musil – Secretary and Director

Mr. Gary Musil was appointed as one our directors on October 23, 2003 and is presently our corporate Secretary. Mr. Musil was our Chief Executive Officer and Chief Financial Officer from October 23, 2003 to February 3, 2004. Mr. Musil has more than 30 years of management and financial consulting experience. Mr. Musil has served as an officer and director on numerous public mining companies since 1988. This experience has resulted in his overseeing exploration projects in Peru, Chile, Eastern Europe (Slovak Republic), British Columbia, Ontario, Quebec and New Brunswick (Canada). Prior to this, he was employed for 15 years with Dickenson Mines Ltd. and Kam-Kotia Mines Ltd. as a controller for the producing silver/lead/zinc mine in the interior of British Columbia, Canada. Mr. Musil currently serves as an officer/director of four TSX Venture Exchange public companies in Canada. Mr. Musil has been the President, Chief Executive Officer, Chief Financial Officer and a director of International Montoro Resources Inc., a TSX Venture company and a reporting issuer in Canada, since February 1999. Mr. Musil has been the chief financial officer and secretary and a director of Belmont Resources Inc., a TSX Venture company and a reporting issuer in Canada, since August 1992. Mr. Musil has been the chief financial officer and a director of Megastar Development Corp, a TSX Venture company and a reporting issuer in Canada, since July 2006. Mr. Musil has been the Chief Financial Officer and secretary of Highbank Resources Ltd., a TSX Venture company and a reporting issuer in Canada, since December 1988.

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We believe Mr. Musil is qualified to serve on our board of directors because of his knowledge of our company’s history and current operations, which he gained from working for our company as described above, in addition to his education and business experience as described above.

John Guilbert – Director

Dr. Guilbert was appointed as one of our directors on February 5, 2004. Dr. Guilbert is a Professor Emeritus at the University of Arizona and is a world-renowned geologist and author and a co-developer of the Lowell-Guilbert porphyry copper model and recipient of two mining awards, the R.A.F. Penrose Medal and the D.C. Jackling Award. Dr. Guilbert has served as a director of Excellon Inc. a Vancouver Stock Exchange listed company from 1992 – 1996. Dr. Guilbert has served as a Board Chairman and director for JABA Inc., an Alberta Stock Exchange (later CDNX then TSX) listed company from 1996 – 2002.

We believe Mr. Guilbert is qualified to serve on our board of directors because of his knowledge of our company’s history and current operations, which he gained from working for our company as described above, in addition to his education and business experience as described above.

Keith Brill – Director

Mr. Brill was appointed as one of our directors on December 23, 2009. Mr. Brill received an International Master of Business Administration (IMBA) from the Moore School of Business, University of South Carolina in May 2005. He graduated from the South Carolina Honors College, University of South Carolina in May 2003 with a Bachelor of Science, magna cum laude, major in Economics and Finance, minor in Spanish. Mr. Brill has been a management consultant with PA Consulting Group, Inc., a leading global consulting firm, since 2004. He has provided multinational Fortune 500 companies with consulting advice on topics including cost reduction, operational efficiency, and IT strategy. Mr. Brill has extensive experience in conducting ROI analysis, developing business cases, and providing strategic financial advice on major business transformation programs.

We believe Mr. Brill is qualified to serve on our board of directors because of his knowledge of our company’s history and current operations, which he gained from working for our company as described above, in addition to his education and business experience as described above.

William Cavalier – Director

Mr. Cavalier was appointed as one of our directors on September 21, 2009. Mr. Cavalier received his B.S. Cum Laude from the University of California-Berkeley in 1976 and received his J.D. from the University of California-Hastings College of Law in 1979. He was a law clerk for Justices Robert Kane and Allison Rouse, California Court of Appeal in 1978 and has been an active member of the California State Bar since 1979. Mr. Cavalier has extensive experience in management consulting and finance. Recently Mr. Cavalier has been engaged as General Counsel and syndicate manager to structure Regulation D 506 private placements for oil and gas royalty property groups and multi-well drilling partnerships for sale through FINRA broker-dealers. He also represented a joint venture, which applied an innovative technology to treat crude oil emulsions in crude production and wastewater remediation.

As a principal for Lone Star Group, Inc., he accepted finance and analytical engagements where commercial real property was a significant element of the transaction. Representative assignments included: $2.85 million permanent financing for Dallas, Texas Walgreen’s; $3 million acquisition financing for a Denton, Texas quarter horse breeding facility; $10 million warehouse line for a hard money lender; $9.5 million sale leaseback of New Jersey industrial property and a $12 million construction loan for Crowley, Texas multifamily project.

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As a Senior Real Estate Investment Banker for Lincoln Capital Group he was responsible for a variety of assignments including product development for a wholesale warehouse lender, commercial resort development evaluation and repositioning, analysis of existing business infrastructure and business processes at a regional commercial mortgage brokerage firm and developing a capital structure and loan proposal for a 44 acre multi-use development including two 168 unit multifamily properties, a 40,000 square foot office, two corner bank pad sites and 15,000 square foot retail building in Dallas, TX suburbs.

We believe Mr. Cavalier is qualified to serve on our board of directors because of his knowledge of our company’s history and current operations, which he gained from working for our company as described above, in addition to his education and business experience as described above.

Larry Liang – Director & Vice President of Business Development – China

Mr. Liang has a strong background in international business development both in China and the United States. As a banker and real estate broker, Mr. Liang has negotiated multi-million dollar transactions for Chinese, American and other international clients. His current focus is on entrepreneurial projects that will utilize his expertise in public and private mergers and acquisitions, joint ventures and strategic alliances. Previously, Mr. Liang had practiced corporate law for the Tian Lun Law Firm, one of southern China ’s largest law firms. He holds law degrees from the Southwest University of Political Science and Law, Chong Qing, China and from the James E. Rogers College of Law, University of Arizona, Tucson, Arizona.

We believe Mr. Lang is qualified to serve on our board of directors because of his knowledge of our company’s history and current operations, which he gained from working for our company as described above, in addition to his education and business experience as described above.

Family Relationships

There are no family relationships among our directors or officers.

Board and Committee Meetings

The board of directors of our company held one formal meeting in the year ended January 31, 2010 and thirteen formal meetings in the year ended January 31, 2009. All proceedings of the board of directors were conducted by resolutions consented to in writing by all the directors and filed with the minutes of the proceedings of the directors. Such resolutions consented to in writing by the directors entitled to vote on that resolution at a meeting of the directors are, according to the Nevada General Corporate Law and the By-laws of our company, as valid and effective as if they had been passed at a meeting of the directors duly called and held.

There have been no material changes to the procedures by which our shareholders may recommend nominees to our board of directors during the year ended January 31, 2010. Shareholders may contact our President, Jim Briscoe, to recommend nominees to our board of directors.

For the year ended January 31, 2010 our only standing committee of the board of directors was our audit committee. We do not have a nominating committee or a compensation committee.

Audit Committee

Currently our audit committee consists of our entire board of directors, James Briscoe, Gary Musil, and John Guilbert, William Cavalier and Keith Brill. We do not have a separately-designated standing audit committee established in accordance with section 3(a)(58)(A) of the Exchange Act.

During fiscal years ended January 31, 2010 and January 31, 2009, there were no special meetings held by this committee. The business of the Audit Committee was conducted by resolutions consented to in writing by all the members of the board and filed with the minutes of the proceedings of the board.

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Audit Committee Financial Expert

Our board of directors has determined that it does not have a member of its board of directors or audit committee that qualifies as an "audit committee financial expert" as defined in Item 407(d)(5)(ii) of Regulation S-K, or who is "independent" as the term is used in Item 7(d)(3)(iv) of Schedule 14A under the Securities Exchange Act of 1934, as amended.

We believe that the members of our board of directors are collectively capable of analyzing and evaluating our consolidated financial statements and understanding internal controls and procedures for financial reporting. In addition, we believe that retaining an independent director who would qualify as an "audit committee financial expert" would be overly costly and burdensome and is not warranted in our circumstances given the early stages of our development and the fact that we have not generated any material revenues to date.

Involvement in Certain Legal Proceedings

Our directors and executive officers have not been involved in any of the following events during the past ten years:

Section 16(a) Beneficial Ownership Compliance

Section 16(a) of the Securities Exchange Act requires our executive officers and directors, and persons who own more than 10% of our common stock, to file reports regarding ownership of, and transactions in, our securities with the Securities and Exchange Commission and to provide us with copies of those filings. Based solely on our review of the copies of such forms received by us, or written representations from certain reporting persons, we believe that during the year ended January 31, 2010, all filing requirements applicable to its officers, directors and greater than 10% percent beneficial owners were complied with.

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Code of Ethics

Effective March 15, 2004, our company's board of directors adopted a Code of Business Conduct and Ethics that applies to, among other persons, our company's president and secretary (being our principal executive officer, principal financial officer and principal accounting officer), as well as persons performing similar functions. As adopted, our Code of Business Conduct and Ethics sets forth written standards that are designed to deter wrongdoing and to promote:

In addition, our Code of Business Conduct and Ethics emphasizes that all employees, and particularly Senior Officers, have a responsibility for maintaining financial integrity within our company, consistent with generally accepted accounting principles, and federal and state securities laws. Any Senior Officer who becomes aware of any incidents involving financial or accounting manipulation or other irregularities, whether by witnessing the incident or being told of it, must report it to our company. Any failure to report such inappropriate or irregular conduct of others is to be treated as a severe disciplinary matter. It is against our company policy to retaliate against any individual who reports in good faith the violation or potential violation of our company's Code of Business Conduct and Ethics by another.

Our Code of Business Conduct and Ethics was filed with the Securities and Exchange Commission on March 13, 2004 as Exhibit 14.1 to our annual report. We will provide a copy of the Code of Business Conduct and Ethics to any person without charge, upon request. Requests can be sent to: Liberty Star Uranium & Metals Corp., 5610 E Sutler Ln, Tucson, Arizona 85712.

Item 11.      EXECUTIVE COMPENSATION.

Following are the particulars of all compensation paid or accruing to our named executive officers for the last two fiscal years ended.

Summary Compensation Table

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Outstanding Equity Awards at Fiscal Year-End

The following table sets forth for each named executive officer certain information concerning the outstanding equity awards as of January 31, 2010.

COMPENSATION PLANS

As of January 31, 2010 we had two compensation plans in place, entitled "2004 Stock Option Plan" and “2007 Stock Option Plan”. These plans have been approved by our security holders. These plans have been given retroactive effect of the 1 for 4 reverse stock split on September 1, 2009.

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On May 21, 2008 we granted 106,250 non-qualified stock options to non-employee consultants and 762,500 incentive stock options to employees, officers and directors. The options have an exercise price of $0.055 per option. On June 26, 2008 the board eliminated the vesting period so the options would be fully vested effective on that date. The options have a life of ten years.

Long-Term Incentive Plans

There are no arrangements or plans in which we provide pension, retirement or similar benefits for directors or executive officers, except that our directors and executive officers receive stock options at the discretion of our Board. We do not have any material bonus or profit sharing plans pursuant to which cash or non-cash compensation is or may be paid to our directors or executive officers, except that stock options may be granted at the discretion of our Board.

We have no plans or arrangements in respect of remuneration received or that may be received by our executive officers to compensate such officers in the event of termination of employment (as a result of resignation, retirement, change of control) or a change of responsibilities following a change of control, where the value of such compensation exceeds $60,000 per executive officer.

Employment Contracts

We have not entered into any written employment agreements or compensation arrangements with any of our named executive officers. We have entered into a verbal agreement with James Briscoe, CEO and Director for annual salary of $120,000.

Compensation of Directors

We have no formal plan for compensating our directors for their service in their capacity as directors, although such directors are expected in the future to receive stock options to purchase common stock as awarded by our board of directors or (as to future stock options) a compensation committee which may be established. Directors are entitled to reimbursement for reasonable travel and other out-of-pocket expenses incurred in connection with attendance at meetings of our board of directors. Our board of directors may award special remuneration to any director undertaking any special services on our behalf other than services ordinarily required of a director. No director received and/or accrued any compensation for their services as a director, including committee participation and/or special assignments.

There was no compensation paid or accruing to any director, unless such director is also a named executive officer, during the last fiscal year ended.

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Item 12.      Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

We have set forth in the following table certain information regarding our common stock beneficially owned on January 31, 2010 for (i) each shareholder we know to be the beneficial owner of 5% or more of our outstanding common stock, (ii) each of our executive officers and directors, and (iii) all executive officers and directors as a group. In general, a person is deemed to be a "beneficial owner" of a security if that person has or shares the power to vote or direct the voting of such security, or the power to dispose or to direct the disposition of such security. A person is also deemed to be a beneficial owner of any securities of which the person has the right to acquire beneficial ownership within 60 days. As of January 31, 2010, we had outstanding 247,656,979 shares of common stock issues and outstanding.

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Changes in Control

At January 31, 2010 we had 247,656,979 shares of common stock issued and outstanding. At January 31, 2010 if the settlement of the Convertible Promissory Notes was completed by the issuance of common shares there would be 2,021,513,000 shares required to convert the notes. Therefore, it is possible that if the holders of our Convertible Promissory Notes were to settle their debt through the issuance of common shares it would cause a change in control.

Item 13.      Certain Relationships and Related Transactions, and Director Independence.

Certain Relationships and Related Transactions

Other than as listed below, we have not been a party to any transaction, proposed transaction, or series of transactions in which the amount involved exceeds $60,000, and in which, to our knowledge, any of our directors, officers, five percent beneficial security holder, or any member of the immediate family of the foregoing persons has had or will have a direct or indirect material interest.

Director Independence

We have no directors who meet the definition set forth in Rule 5605(a)(2) of the Listing Rules of the NASDAQ, which defines an “independent director” generally as a person other than an executive officer or employee of the company, or any other individual having a relationship which, in the opinion of the company’s board of directors, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director.

Item 14.      Principal Accountants Fees and Services.

Audit Fees

For the fiscal year ended January 31, 2010, the aggregate fees billed by Semple, Marchal & Cooper, LLP for professional services rendered for the audit of our annual consolidated financial statements included in our annual report on Form 10-K and for the reviews of our consolidated financial statements included in Forms 10-Q were $80,823. For the fiscal year ended January 31, 2009, the aggregate fees billed by Semple, Marchal & Cooper, LLP for professional services rendered for the audit of our annual consolidated financial statements included in our annual report on Form 10-K and for the reviews of our consolidated financial statements included in Forms 10-Q were $80,086.

Audit Related Fees

For the fiscal year ended January 31, 2010, the aggregate fees billed for assurance and related services by Semple, Marchal & Cooper LLP relating to the performance of the audit of our consolidated financial statements which are not reported under the caption "Audit Fees" above, was $0. For the fiscal year ended January 31, 2009, the aggregate fees billed for assurance and related services by Semple, Marchal & Cooper LLP relating to the performance of the audit of our consolidated financial statements which are not reported under the caption "Audit Fees" above, was $0.

Tax Fees

For the fiscal years ended January 31, 2010 and 2009, the aggregate fees billed by Semple, Marchal & Cooper, LLP for other non-audit professional services, other than those services listed above, totalled $0 in both years.

All Other Fees

We do not use Semple, Marchal & Cooper, LLP for financial information system design and implementation. These services, which include designing or implementing a system that aggregates source data underlying the financial statements or generates information that is significant to our consolidated financial statements, are provided internally or by other service providers. We do not engage Semple, Marchal & Cooper, LLP to provide compliance outsourcing services.

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Effective May 6, 2003, the Securities and Exchange Commission adopted rules that require that before Semple, Marchal & Cooper, LLP is engaged by us to render any auditing or permitted non-audit related service, the engagement be:

• approved by our audit committee (which consists of our entire board of directors); or

• entered into pursuant to pre-approval policies and procedures established by the board of directors, provided the policies and procedures are detailed as to the particular service, the board of directors is informed of each service, and such policies and procedures do not include delegation of the board of directors' responsibilities to management.

The board of directors pre-approves all services provided by our independent auditors. All of the above services and fees were reviewed and approved by the board of directors either before or after the respective services were rendered.

The board of directors has considered the nature and amount of fees billed by Semple, Marchal & Cooper, LLP and believes that the provision of services for activities unrelated to the audit is compatible with maintaining Semple, Marchal & Cooper, LLP's independence.

Exhibits.

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SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

LIBERTY STAR URANIUM & METALS CORP.

By: /s/ James Briscoe                                                        

James A. Briscoe
Chief Executive Officer, President and Director
Chief Financial Officer
(Principal Executive Officer)
(Principal Financial Officer and Principal Accounting Officer)
Dated: May 12, 2010

Pursuant to the requirements of the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By: /s/ James Briscoe                                                        

James A. Briscoe
Chief Executive Officer, President and Director
Chief Financial Officer
(Principal Executive Officer)
(Principal Financial Officer and Principal Accounting Officer)
Dated: May 12, 2010