SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



FORM 10-QSB



{X} QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE

SECURITIES EXCHANGE ACT OF 1934



FOR THE QUARTERLY PERIOD ENDED July 31, 2007



OR



{ } TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE

SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM ________ TO __________



REGISTRATION NUMBER 333-101960

YUKON GOLD CORPORATION, INC.

(Exact name of registrant as specified in its charter)



|Delaware                            | 52-2243048          
|----------------------------------- | --------------------
|(State
    or other jurisdiction of | (I.R.S.
    Employer
|incorporation or organization)      | Identification No.) 



55 York Street, Suite 401, Toronto, Ontario M5J 1R7

(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code: (416) 865-9790



Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15 (d) of the Exchange Act during the past 12 months (or 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 [  ]
|------- | -------



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



|Class                               | Outstanding As of July 31, 2007
|----------------------------------- | -------------------------------
|Common
    Shares $ .0001 par value | 23,019,501                     



---





YUKON GOLD CORPORATION, INC.
(AN EXPLORATION STAGE COMPANY)

INTERIM CONSOLIDATED FINANCIAL STATEMENTS

JULY 31, 2007

(Amounts expressed in US Dollars)

(Unaudited )



|TABLE OF CONTENTS                                                                                                                                    
|-----------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                     
|                                                                                                                                                     
|Interim Consolidated Balance Sheets as
    of July 31, 2007 and April 30, 2007                                                                       
|                                                                                                                                                     
|Interim Consolidated Statements of
    Operations for the three months ended July 31, 2007 and July 31, 2006                                         
|                                                                                                                                                     
|Interim Consolidated Statements of
    Cash Flows for the three months ended July 31, 2007 and July 31, 2006                                         
|                                                                                                                                                     
|Interim Consolidated Statements of
    Changes in Stockholders Equity for the three months ended July 31, 2007 and
    the year ended April 30, 2007
|                                                                                                                                                     
|Condensed Notes to Interim
    Consolidated Financial Statements                                                                                     





---

YUKON GOLD CORPORATION, INC. 
(An Exploration Stage Company) Interim Consolidated Balance Sheets 
As of July 31, 2007 and April 30, 2007 
(Amounts expressed in US Dollars) 
(Unaudited)

|                                                                      | July 31, 2007 |           | April 30, 2007
|--------------------------------------------------------------------- | ------------- | --------- | --------------
|                                                                      | $             |           | $             
|ASSETS                                                                |               |           |               
|CURRENT ASSETS                                                        |               |           |               
|                                                                      |               |           |               
|Cash and cash equivalents                                             |               | 256,223   |               
|Prepaid expenses and other (Note 10)                                  |               | 2,225,787 |               
|Exploration tax credit receivable (Note 4)                            |               | 483,258   |               
|Short-term investment in
    available- for- sale securities (Note 9) |               | 350,000   |               
|Restricted Deposit                                                    |               | -         |               
|                                                                      |               | 3,315,268 |               
|                                                                      |               |           |               
|RESTRICTED CASH (Note 5)                                              |               | -         |               
|PROPERTY, PLANT AND EQUIPMENT                                         |               | 58,663    |               
|                                                                      |               | 3,373,931 |               



See condensed notes to the interim consolidated financial statements.





APPROVED ON BEHALF OF THE BOARD



/s/ Paul Gorman

Paul Gorman, Director



/s/ J. L. Guerra, Jr.

J. L. Guerra, Jr., Director



1

---



YUKON GOLD CORPORATION, INC. 
(An Exploration Stage Company) 
Interim Consolidated Balance Sheets 
As of July 31, 2007 and April 30, 2007 
(Amounts expressed in US Dollars) 
(Unaudited)



|                                                   | July 31, 2007 |             | April 30, 2007
|-------------------------------------------------- | ------------- | ----------- | --------------
|                                                   | $             |             | $             
|LIABILITIES                                        |               |             |               
|                                                   |               |             |               
|CURRENT LIABILITIES                                |               |             |               
|                                                   |               |             |               
|Accounts payable and accrued liabilities (Note 11) |               | 146,909     |               
|Obligation under Capital Lease                     |               | 2,858       |               
|Total Current Liabilities                          |               | 149,767     |               
|                                                   |               |             |               
|Long -Term Portion of:                             |               |             |               
|Obligation under Capital Lease                     |               | 9,304       |               
|                                                   |               |             |               
|TOTAL LIABILITIES                                  |               | 159,071     |               
|                                                   |               |             |               
|COMMITMENTS AND CONTINGENCIES (Note 8)             |               |             |               
|                                                   |               |             |               
|SHAREHOLDERS EQUITY                               |               |             |               
|                                                   |               |             |               
|CAPITAL STOCK                                      |               | 2,301       |               
|                                                   |               |             |               
|ADDITIONAL PAID-IN CAPITAL                         |               | 11,124,135  |               
|                                                   |               |             |               
|ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)      |               | 76,350      |               
|                                                   |               |             |               
|DEFICIT, ACCUMULATED DURING THE EXPLORATION STAGE  |               | (7,987,926) |               
|                                                   |               | 3,214,860   |               
|                                                   |               | 3,373,931   |               



See condensed notes to the interim consolidated financial statements.



2

---

YUKON GOLD CORPORATION, INC. 
(An Exploration Stage Company) Interim Consolidated Statements of Operations 
For the three months ended July 31, 2007 and July 31, 2006 
(Amounts expressed in US Dollars) 
(Unaudited)

|                                           | Cumulative since inception |             | For the quarter
    ended
    July 31, 2007 |  | For the quarter
    ended
    July 31, 2006
|------------------------------------------ | -------------------------- | ----------- | ------------------------------------------- |  | -------------------------------------------
|                                           | $                          |             | $                                           |  | $                                          
|OPERATING EXPENSES                         |                            |             |                                             |  |                                            
|                                           |                            |             |                                             |  |                                            
|General and administration                 |                            | 4,180,088   |                                             |  | 74,886                                     
|Project expenses                           |                            | 4,783,529   |                                             |  | 974,725                                    
|Exploration Tax Credit                     |                            | (605,716)   |                                             |  | -                                          
|Amortization                               |                            | 20,867      |                                             |  | 2,933                                      
|Loss on sale/disposal of capital assets    |                            | 5,904       |                                             |  | -                                          
|                                           |                            |             |                                             |  |                                            
|TOTAL OPERATING EXPENSES                   |                            | 8,384,672   |                                             |  | 1,052,544                                  
|                                           |                            |             |                                             |  |                                            
|LOSS BEFORE INCOME TAXES                   |                            | (8,384,672) |                                             |  | (1,052,544)                                
|                                           |                            |             |                                             |  |                                            
|Income taxes recovery                      |                            | 396,746     |                                             |  | -                                          
|                                           |                            |             |                                             |  |                                            
|NET LOSS                                   |                            | (7,987,926) |                                             |  | (1,052,544)                                
|                                           |                            |             |                                             |  |                                            
|Loss per share - basic and diluted         |                            |             |                                             |  | (0.05)                                     
|                                           |                            |             |                                             |  |                                            
|Weighted average common shares outstanding |                            |             |                                             |  | 22,920,192                                 



See condensed notes to the interim consolidated financial statements.



3

---

YUKON GOLD CORPORATION, INC.
(An Exploration Stage Company) Interim Consolidated Statements of Cash Flows 
For the three months ended July 31, 2007 and July 31, 2006 (Amounts expressed in US Dollars) (Unaudited)

|                                                                             | Cumulative Since Inception |             | For the Quarter
    ended
    July 31, 2007 |  | For the Quarter
    ended
    July 31, 2006
|---------------------------------------------------------------------------- | -------------------------- | ----------- | ------------------------------------------- |  | -------------------------------------------
|                                                                             | $                          |             | $                                           |  | $                                          
|CASH FLOWS FROM OPERATING ACTIVITIES                                         |                            |             |                                             |  |                                            
|Net loss for the year                                                        |                            | (7,987,926) |                                             |  | (1,052,544)                                
|Items not requiring an outlay of cash:                                       |                            |             |                                             |  |                                            
|Amortization                                                                 |                            | 20,867      |                                             |  | 2,933                                      
|Loss on sale/disposal of property, plant, equipment                          |                            | 5,904       |                                             |  | -                                          
|Registration rights penalty expense                                          |                            | 188,125     |                                             |  | -                                          
|Shares issued for property payment                                           |                            | 525,339     |                                             |  | 57,252                                     
|Common shares issued for settlement of severance liability to
    ex-officer |                            | 113,130     |                                             |  | -                                          
|Stock-based compensation                                                     |                            | 793,689     |                                             |  | 117,170                                    
|Issue of shares for professional services                                    |                            | 852,523     |                                             |  | -                                          
|Issue of units against settlement of debts                                   |                            | 20,077      |                                             |  | -                                          
|Increase in prepaid expenses and other                                       |                            | (2,226,703) |                                             |  | (1,763,489)                                
|Increase in exploration tax credit receivable                                |                            | (483,258)   |                                             |  | -                                          
|Increase (Decrease) in accounts payable and accrued
    liabilities          |                            | 146,419     |                                             |  | (113,225)                                  
|Decrease (Increase) in restricted cash                                       |                            | -           |                                             |  | 2,266,602                                  
|Decrease in restricted deposit                                               |                            | -           |                                             |  | 17,889                                     
|                                                                             |                            |             |                                             |  |                                            
|NET CASH USED IN OPERATING ACTIVITIES                                        |                            | (8,031,814) |                                             |  | (467,412)                                  
|                                                                             |                            |             |                                             |  |                                            
|CASH FLOWS FROM INVESTING ACTIVITIES                                         |                            |             |                                             |  |                                            
|Purchase of property, plant and equipment                                    |                            | (83,498)    |                                             |  | (2,760)                                    
|Investment in available- for- sale securities                                |                            | (250,000)   |                                             |  | (250,000)                                  
|                                                                             |                            |             |                                             |  |                                            
|NET CASH USED IN INVESTING ACTIVITIES                                        |                            | (333,498)   |                                             |  | (252,760)                                  
|                                                                             |                            |             |                                             |  |                                            
|CASH FLOWS FROM FINANCING ACTIVITIES                                         |                            |             |                                             |  |                                            
|Repayments from a shareholder                                                |                            | 1,180       |                                             |  | -                                          
|Proceeds (Repayments) from Demand promissory notes                           |                            | 200,000     |                                             |  | -                                          
|Proceeds from Convertible promissory notes converted                         |                            | 200,500     |                                             |  | -                                          
|Proceeds from the exercise of stock options                                  |                            | 61,000      |                                             |  | -                                          
|Proceeds from exercise of warrants - net                                     |                            | 450,309     |                                             |  | -                                          
|Proceeds from subscription of warrants - net                                 |                            | 525,680     |                                             |  | -                                          
|Proceeds from issuance of units/shares - net                                 |                            | 7,189,001   |                                             |  | -                                          
|Proceeds (Repayments) from capital lease obligation                          |                            | 11,949      |                                             |  | -                                          
|                                                                             |                            |             |                                             |  |                                            
|NET CASH PROVIDED BY FINANCING ACTIVITIES                                    |                            | 8,639,619   |                                             |  | -                                          
|                                                                             |                            |             |                                             |  |                                            
|EFFECT OF FOREIGN CURRENCY EXCHANGE RATE CHANGES                             |                            | (18,084)    |                                             |  | 39,959                                     
|                                                                             |                            |             |                                             |  |                                            
|NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS FOR THE
    YEAR        |                            | 256,223     |                                             |  | (680,213)                                  
|Cash and cash equivalents, beginning of year                                 |                            | -           |                                             |  | 936,436                                    
|                                                                             |                            |             |                                             |  |                                            
|CASH AND CASH EQUIVALENTS, END OF YEAR                                       |                            | 256,223     |                                             |  | 256,223                                    
|INCOME TAXES PAID                                                            |                            |             |                                             |  | -                                          
|INTEREST PAID                                                                |                            |             |                                             |  | -                                          



See condensed notes to the interim consolidated financial statements.



4

---

YUKON GOLD CORPORATION, INC.
(An Exploration Stage Company) Interim Consolidated Statements of Changes in Stockholders Equity From Inception to July 31, 2007 (Amounts expressed in US Dollars) (Unaudited)



|                                                                            | Number of Common Shares | Common Shares Amount | Additional Paid-in Capital | Subscription for Warrants | Deficit, Accumulated during the Exploration Stage | Comprehensive Income (loss) | Accumulated Other Comprehensive Income (loss)
|--------------------------------------------------------------------------- | ----------------------- | -------------------- | -------------------------- | ------------------------- | ------------------------------------------------- | --------------------------- | ---------------------------------------------
|                                                                            | #                       | $                    | $                          | $                         | $                                                 | $                           | $                                            
|Issuance of Common shares                                                   | 2,833,377               | 154,063              | -                          | -                         | -                                                 | -                           | -                                            
|Issuance of warrants                                                        | -                       | -                    | 1,142                      | -                         | -                                                 | -                           | -                                            
|Foreign currency translation                                                | -                       | -                    | -                          | -                         |                                                   | 604                         | 604                                          
|Net loss for the year                                                       | -                       | -                    | -                          |                           | (124,783)                                         | (124,783)                   | -                                            
|                                                                            |                         |                      |                            |                           |                                                   |                             |                                              
|Balance as of April 30, 2003                                                | 2,833,377               | 154,063              | 1,142                      | -                         | (124,783)                                         | (124,179)                   | 604                                          
|                                                                            |                         |                      |                            |                           |                                                   |                             |                                              
|Issuance of Common shares                                                   | 1,435,410               | 256,657              | -                          | -                         | -                                                 | -                           |                                              
|Issuance of warrants                                                        | -                       | -                    | 2,855                      | -                         | -                                                 | -                           |                                              
|Shares repurchased                                                          | (240,855)               | (5,778)              | -                          | -                         | -                                                 | -                           |                                              
|Recapitalization pursuant to reverse acquisition                            | 2,737,576               | (404,265)            | 404,265                    | -                         | -                                                 | -                           |                                              
|Issuance of Common shares                                                   | 1,750,000               | 175                  | 174,825                    | -                         | -                                                 | -                           |                                              
|Issuance of Common shares for Property Payment                              | 300,000                 | 30                   | 114,212                    | -                         | -                                                 | -                           |                                              
|Foreign currency translation                                                | -                       | -                    | -                          | -                         | -                                                 | (12,796)                    | (12,796)                                     
|Net loss for the year                                                       | -                       | -                    | -                          | -                         | (442,906)                                         | (442,906)                   | -                                            
|                                                                            |                         |                      |                            |                           |                                                   |                             |                                              
|Balance as of April 30, 2004                                                | 8,815,508               | 882                  | 697,299                    | -                         | (567,689)                                         | (455,702)                   | (12,192)                                     
|                                                                            |                         |                      |                            |                           |                                                   |                             |                                              
|Issuance of Common shares for Property Payment                              | 133,333                 | 13                   | 99,987                     | -                         | -                                                 | -                           | -                                            
|Issuance of common shares on Conversion of Convertible Promissory note      | 76,204                  | 8                    | 57,144                     | -                         | -                                                 | -                           | -                                            
|Foreign currency translation                                                | -                       | -                    | -                          | -                         | -                                                 | 9,717                       | 9,717                                        
|Net loss for the year                                                       | -                       | -                    | -                          | -                         | (808,146)                                         | (808,146)                   | -                                            
|                                                                            |                         |                      |                            |                           |                                                   |                             |                                              
|Balance as of April 30, 2005                                                | 9,025,045               | 903                  | 854,430                    | -                         | (1,375,835)                                       | (798,429)                   | (2,475)                                      
|                                                                            |                         |                      |                            |                           |                                                   |                             |                                              
|Stock based compensation - Directors and officers                           |                         |                      | 216,416                    |                           |                                                   |                             |                                              
|Stock based compensation - Consultants                                      |                         |                      | 8,830                      |                           |                                                   |                             |                                              
|Issue of common shares and Warrants on retirement of Demand Promissory note | 369,215                 | 37                   | 203,031                    |                           |                                                   |                             |                                              
|Units issued to an outside company for professional services settlement     | 24,336                  | 2                    | 13,384                     |                           |                                                   |                             |                                              
|Units issued to an officer for professional services settlement             | 12,168                  | 1                    | 6,690                      |                           |                                                   |                             |                                              
|Issuance of common shares for professional services                         | 150,000                 | 15                   | 130,485                    |                           |                                                   |                             |                                              
|Units issued to shareholder                                                 | 490,909                 | 49                   | 269,951                    |                           |                                                   |                             |                                              
|Units issued to a director                                                  | 149,867                 | 15                   | 82,412                     |                           |                                                   |                             |                                              
|Units issued to outside subscribers                                         | 200,000                 | 20                   | 109,980                    |                           |                                                   |                             |                                              
|Issuance of common shares on Conversion of Convertible Promissory notes     | 59,547                  | 6                    | 44,654                     |                           |                                                   |                             |                                              
|Issuance of common shares on Exercise of warrants                           | 14,000                  | 2                    | 11,998                     |                           |                                                   |                             |                                              
|Issuance of common shares on Conversion of Convertible Promissory notes     | 76,525                  | 8                    | 57,386                     |                           |                                                   |                             |                                              
|Private placement of shares                                                 | 150,000                 | 15                   | 151,485                    |                           |                                                   |                             |                                              
|Issuance of Common shares for property payment                              | 133,333                 | 13                   | 99,987                     |                           |                                                   |                             |                                              
|Issuance of common shares on Conversion of Convertible Promissory notes     | 34,306                  | 4                    | 25,905                     |                           |                                                   |                             |                                              



5

---

YUKON GOLD CORPORATION, INC.
(An Exploration Stage Company) Interim Consolidated Statements of Changes in Stockholders Equity From Inception to July 31, 2007 (Amounts expressed in US Dollars) (Unaudited)



|Issuance of common shares on Exercise of warrants                        | 10,000     | 1     | 8,771     |             |             |             |         
|------------------------------------------------------------------------ | ---------- | ----- | --------- | ----------- | ----------- | ----------- | --------
|Issuance of common shares on Conversion of Convertible Promissory notes  | 101,150    | 10    | 76,523    |             |             |             |         
|Issue of 400,000 Special Warrants net                                    |            |       |           | 371,680     |             |             |         
|Issue of 200,000 flow through warrants                                   |            |       |           | 154,000     |             |             |         
|Brokered private placement of shares- net                                | 5,331,327  | 533   | 2,910,375 |             |             |             |         
|Brokered Private placement of flow through Shares- net                   | 25,000     | 2     | 13,310    |             |             |             |         
|Exercise of stock options                                                | 10,000     | 1     | 5,499     |             |             |             |         
|Foreign currency translation                                             | -          | -     | -         |             |             | (2,687)     | (2,687) 
|Net loss for the year                                                    | -          | -     | -         |             | (1,855,957) | (1,855,957) | -       
|                                                                         |            |       |           |             |             |             |         
|Balance as of April 30, 2006                                             | 16,366,728 | 1,637 | 5,301,502 | 525,680     | (3,231,792) | (1,858,644) | (5,162) 
|                                                                         |            |       |           |             |             |             |         
|Exercise of warrants                                                     | 10,000     | 1     | 8,986     |             |             |             |         
|Exercise of warrants                                                     | 45,045     | 5     | 40,445    |             |             |             |         
|Exercise of warrants                                                     | 16,000     | 2     | 14,278    |             |             |             |         
|Common shares issued for settlement of severance liability to ex-officer | 141,599    | 14    | 113,116   |             |             |             |         
|Exercise of warrants                                                     | 43,667     | 4     | 39,364    |             |             |             |         
|Exercise of warrants                                                     | 17,971     | 2     | 15,937    |             |             |             |         
|Exercise of warrants                                                     | 43,667     | 4     | 38,891    |             |             |             |         
|Exercise of warrants                                                     | 16,000     | 2     | 14,251    |             |             |             |         
|Exercise of warrants                                                     | 158,090    | 16    | 141,616   |             |             |             |         
|Issue of common shares for property payment                              | 43,166     | 4     | 53,841    |             |             |             |         
|Exercise of warrants                                                     | 64,120     | 6     | 57,863    |             |             |             |         
|Exercise of warrants                                                     | 61,171     | 6     | 53,818    |             |             |             |         
|Exercise of stock options                                                | 24,000     | 2     | 17,998    |             |             |             |         
|Issuance of common shares for professional services                      | 342,780    | 34    | 438,725   |             |             |             |         
|Brokered private placement of units-net                                  | 400,000    | 40    | 363,960   |             |             |             |         
|Brokered private placement of units-net                                  | 550,000    | 55    | 498,923   |             |             |             |         
|Stock based compensation-Directors and Officers                          |            |       | 451,273   |             |             |             |         
|Exercise of stock options                                                | 50,000     | 5     | 37,495    |             |             |             |         
|Issuance of common shares for property payment                           | 133,334    | 13    | 99,987    |             |             |             |         
|Issuance of common shares for professional services                      | 160,000    | 16    | 131,184   |             |             |             |         
|Issuance of common shares for professional services                      | 118,800    | 12    | 152,052   |             |             |             |         
|Issue of shares for flow-through warrants                                | 200,000    | 20    | 153,980   | (154,000)   |             |             |         
|Issue of shares for special warrants                                     | 404,000    | 41    | 375,679   | (371,680)   |             |             |         
|Issue of 2,823,049 flow- through warrants -net                           |            |       |           | 1,916,374   |             |             |         
|Issue of 334,218 unit special warrants-net                               |            |       |           | 230,410     |             |             |         
|Issue of 3,105,358 common shares for 2,823,049 flow through warrants     | 3,105,358  | 310   | 1,916,064 | (1,916,374) |             |             |         
|Issue of 367,641 common shares for 334,218 unit special warrants         | 367,641    | 37    | 230,373   | (230,410)   |             |             |         
|Registration rights penalty expense                                      |            |       | 188,125   |             |             |             |         
|Foreign currency translation                                             |            |       |           |             |             | (58,446)    | (58,446)



6

---

YUKON GOLD CORPORATION, INC.
(An Exploration Stage Company) Interim Consolidated Statements of Changes in Stockholders Equity From Inception to July 31, 2007 (Amounts expressed in US Dollars) (Unaudited)



|Net loss for the year                            |              |           |             |             | (3,703,590) | (3,703,590) |         
|------------------------------------------------ | ------------ | --------- | ----------- | ----------- | ----------- | ----------- | --------
|                                                 |              |           |             |             |             |             |         
|Balance as of April 30, 2007                     | 22,883,137   | 2,288     | 10,949,726  | -           | (6,935,382) | (3,762,036) | (63,608)
|Issuance of common shares for property payment   | 136,364      | 13        | 57,239      |             | -           | -           | -       
|Stock based compensation-Directors and Officers  |              |           | 117,170     |             | -           | -           |         
|Foreign currency translation                     |              |           |             |             |             | 39,958      | 39,958  
|Unrealized gain on available-for-sale securities |              |           |             |             |             | 100,000     | 100,000 
|Net loss for the  quarter                        | ____________ | _________ | ___________ | ___________ | (1,052,544) | (1,052,544) | _______ 
|Balance as of July 31, 2007                      | 23, 019, 501 | 2,301     | 11,124,135  |             | 7,987,926   | (912,586)   | 76,350  



See condensed notes to the interim consolidated financial statements.



7

---

YUKON GOLD CORPORATION, INC.

(An Exploration Stage Company) Condensed Notes to Interim Consolidated Financial Statements 
July 31, 2007 
(Amounts expressed in US Dollars) 
(Unaudited)

1.   BASIS OF PRESENTATION



The accompanying unaudited interim consolidated financial statements do not
include all the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, all adjustments (consisting of all recurring accruals) considered
necessary for fair presentation have been included. Operating results for the
interim period are not necessarily indicative of the results that may be
expected for the year ended April 30, 2008. Interim financial statements should
be read in conjunction with the Companys annual audited financial statements.



The interim consolidated financial statements include the accounts of Yukon Gold
Corporation, Inc. (the Company) and its wholly owned subsidiary Yukon Gold
Corp. (YGC). All material inter-company accounts and transactions have been
eliminated.



2.   GOING CONCERN

The Company has no source for operating revenue and expects to incur significant
expenses before establishing operating revenue. The Company has a need for
equity capital and financing for working capital and exploration and development
of its properties. Because of continuing operating losses, the Companys
continuance as a going concern is dependent upon its ability to obtain adequate
financing and to reach profitable levels of operation. The Companys future
success is dependent upon its continued ability to raise sufficient capital, not
only to maintain its operating expenses, but to explore for ore reserves and
develop those it has on its mining claims. There is no guarantee that such
capital will continue to be available on acceptable terms, if at all or if the
Company will attain profitable levels of operation.

Management has initiated plans to raise equity funding through the issuance of
common shares including flow-through shares. The Company was successful in
raising funds (net) of approximately $4 million during the year ended April 30,
2006, which assisted the Company in meeting its commitments and current
requirements for project expenses and general and administrative expenses. The
Company also raised (net) approximately $1.3 million during the six months ended
October 31, 2006. The company further raised (net) an additional approximately
$1.9 million through subscription of flow-through special warrants and raised
(net) approximately $230,000 through subscription of unit special warrants
during the three months ended January 31, 2007. The Companys common shares are
listed on the Toronto Stock exchange and included on the Over-The-Counter
Bulletin Board maintained by NASDAQ in the United States. The trading of the
Companys stock in both the United States and Canada has expanded its investor
base, as the Company continues to explore sources of funding from both the
United States and Canada.



3. NATURE OF OPERATIONS

The Company is an exploration stage mining company and has not yet realized any
revenue from its operations. It is primarily engaged in acquisition, exploration
and development of its two mining properties, both located in the Yukon
Territory in Canada. The Company has not yet determined whether these properties
contain mineral reserves that are economically recoverable. The business of
mining and exploring for minerals involves a high degree of risk and there can
be no assurances that current exploration programs will result in profitable
mining operations.

4. EXPLORATION TAX CREDIT RECEIVABLE



The Company has a claim to the Yukon exploration tax credit, since it maintains
a permanent establishment in the Yukon and has incurred eligible mineral
exploration expenses as defined by the federal income tax regulations of Canada.
The Companys expectation of receiving this credit of $483,258 (CDN$536,465) is
based on the history of receiving past credits. The Company will be filing tax
returns to claim the 2007 credit of $329,024 (CDN$365,249) and has previously
filed for the 2006 credit of $154,234 (CDN$171,216).



---



YUKON GOLD CORPORATION, INC.

(An Exploration Stage Company) 
Condensed Notes to Interim Consolidated Financial Statements 
July 31, 2007 
(Amounts expressed in US Dollars) 
(Unaudited)

5. RESTRICTED CASH



Under Canadian income tax regulations, a company is permitted to issue
flow-through shares whereby the company agrees to incur qualifying expenditures
and renounce the related income tax deductions to the investors. Notwithstanding
that, there is no specific requirement to segregate the funds. The flow-through
funds, which are unexpended at the consolidated balance sheet date are
considered to be restricted and are not considered to be cash or cash
equivalents. As of July 31, 2007 and April 30, 2007, unexpended flow-through
funds were $nil and $2,266,602 (CDN$2,516,155) respectively.



6. STOCK BASED COMPENSATION



Per SEC Staff Accounting Bulletin 107, Topic 14.F, Classification of
Compensation Expense Associated with Share-Based Payment Arrangements stock
based compensation expense is being presented in the same lines as cash
compensation paid.



The Company adopted a new Stock Option Plan at its shareholders meeting on
January 19, 2007 (the 2006 Stock Option Plan). The 2006 Stock Option Plan will
be administered by the board of directors of the Company or, in the board of
directors discretion, by a committee appointed by the board of directors for
that purpose. The TSX approved the 2006 Stock Option plan on March 9, 2007

Subject to the provisions of the 2006 Stock Option Plan, the aggregate number of
shares which may be issued under the 2006 Stock Option Plan shall not exceed
2,000,000 shares ("Total Shares"). Any Stock Option granted under the 2006 Stock
Option Plan which has been exercised shall again be available for subsequent
grant under the 2006 Stock Option Plan, effectively resulting in a re-loading of
the number of shares available for grant under the 2006 Stock Option Plan. Any
shares subject to an option granted under the 2006 Stock Option Plan which for
any reason is surrendered, cancelled or terminated or expires without having
been exercised shall again be available for subsequent grant under the 2006
Stock Option Plan.

Under the 2006 Stock Option Plan, at no time shall: (i) the number of shares
reserved for issuance pursuant to Stock Options granted to any one optionee
exceed 10% of the Total Shares; (ii) the number of shares, together with all
security based compensation arrangements of the Company in effect, reserved for
issuance pursuant to Stock Options granted to any "insiders" (as that term is
defined under the Securities Act (Ontario)) exceed 10% of the total
number of issued and outstanding shares. In addition, the number of shares
issued to insiders pursuant to the exercise of Stock Options, within any one
year period, together with all security based compensation arrangements of the
Company in effect, shall not exceed 10% of the total number of issued and
outstanding shares.

The purchase price (the Price) per share under each Stock Option shall be
determined by the board of directors or a committee, as applicable. The Price
shall not be lower than the closing market price on the TSX, or another stock
exchange where the majority of the trading volume and value of the Shares
occurs, on the trading day immediately preceding the date of grant, or if not so
traded, the average between the closing bid and asked prices thereof as reported
for the trading day immediately preceding the date of the grant; provided that
if the shares have not traded on the TSX or another stock exchange for an
extended period of time, the market price will be the fair market value of the
shares at the time of grant, as determined by the board of directors or
committee. The board of directors or committee may determine that the Price may
escalate at a specified rate dependent upon the date on which an option may be
exercised by the Eligible Participant. The Company has adopted SFAS123 (Revised)
commencing May 1, 2005.

For the quarter ended July 31, 2007, the Company recognized in the financial
statements, stock-based compensation costs as per the following details. The
fair value of each option used for the purpose of estimating the stock
compensation is based on the grant date using the Black-Scholes option pricing
model with the following weighted average assumptions:



|                                                                                  | 19-Jan |        | 20-Mar |   | 28-Mar |   |      
|--------------------------------------------------------------------------------- | ------ | ------ | ------ | - | ------ | - | -----
|                                                                                  | 2007   |        | 2007   |   | 2007   |   | Total
|Risk free rate                                                                    |        | 4.50   | %      |   | 4.50   | % |      
|Volatility factor                                                                 |        | 45.19  | %      |   | 57.48  | % |      
|Expected dividends                                                                |        | nil    |        |   | nil    |   |      
|Stock-based compensation cost expensed during the quarter ended July 31,
    2007 | $      | 98,551 |        | $ | 6,648  |   | $    
|Unexpended Stock -based compensation cost  deferred over the period               | $      | 73,279 |        | $ | 43,474 |   | $    



As of July 31, 2007 there was $148,205 of unrecognized expenses related to
non-vested stock-based compensation arrangements granted. The stock-based
compensation expense for the quarter ended July 31, 2007 was $117,170.



---



YUKON GOLD CORPORATION, INC.

(An Exploration Stage Company) 
Condensed Notes to Interim Consolidated Financial Statements 
July 31, 2007 
(Amounts expressed in US Dollars) 
(Unaudited)





7. ISSUANCE OF COMMON SHARES

Year ended April 30, 2007

On May 29, 2006 the Company issued 10,000 common shares for the exercise of
10,000 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of
$8,987 (CDN$10,000).

On May 29, 2006 the Company issued 45,045 common shares for the exercise of
45,045 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of
$40,450 (CDN$45,045).



On May 29, 2006 the Company issued 16,000 common shares for the exercise of
16,000 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of
$14,280 (CDN$16,000).



On May 30, 2006 the Company issued 141,599 common shares for the settlement of
an accrued liability to an ex officer and director. The accrued severance amount
of $113,130 (CDN$128,855) was converted to 141,599 common shares at $0.80
(CDN$0.91).



On June 22, 2006 the Company issued 43,667 common shares for the exercise of
43,667 warrants at $0.90 (CDN$1.00) from a warrant holder in consideration of
$39,368 (CDN$43,667).



On June 28, 2006 the Company issued 17,971 common shares for the exercise of
17,971 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of
$15,939 (CDN$17,971).

On June 28, 2006 the Company issued 43,667 common shares for the exercise of
43,667 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of
$38,895 (CDN$43,667).

On June 28, 2006 the Company issued 16,000 common shares for the exercise of
16,000 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of
$14,253 (CDN$16,000).

On June 29, 2006 the Company issued 158,090 common shares for the exercise of
158,090 warrants at $0.89 (CDN$1.00) from a warrant holder in consideration of
$141,632 (CDN$158,090).

On July 7, 2006 the Company issued 43,166 common shares in settlement of a
property   payment on the Mount Hinton property. The shares represent $53,845
(CDN$60,000) payment and were valued   $1.25 (CDN$1.39) each.



On July 7, 2006 the Company issued 64,120 common shares for the exercise of
64,120 warrants at $0.90 (CDN$1.00) from a warrant holder in consideration of
$57,869 (CDN$64,120).



On July 17, 2006 the Company issued 61,171 common shares for the exercise of
61,171 warrants at $0.88 (CDN$1.00) from a warrant holder in consideration of
$53,824 (CDN$61,171).



On August 11, 2006 the Company issued 817,980 restricted shares in total to
three consultants for services relating to business promotion and development.
These consultants assisted management in the preparation of financial offerings
and in arranging meetings and making presentations to the brokerage community
and institutional investors in both the United States and Canada. Except for
342,780 common shares which were earned by these consultants as of October 31,
2006, the balance of 475,200 common shares were held in escrow to be released to
each consultant in 8 monthly installments of 19,800 common shares commencing
November 1, 2006. Out of 475,200 common shares held in escrow, the Company
received back 356,400 common shares for cancellation.



On September 7, 2006 the Company issued 24,000 shares to an officer upon
exercising 24,000 vested stock options at $0.75 for a total of $18,000.



On October 3, 2006, the Company completed a brokered private placement and
issued 400,000 units, where each unit consisted of a common share and a share
purchase warrant. The units were priced at $1.00 per unit for a total of
$400,000. The Company paid a finders fee of 6% and reimbursed expenses for 3% of
the total consideration. The warrants have a two-year term and are exercisable
at $1.50 per share in the first twelve months of the term and $2.00 per share in
the remaining twelve months of the term.



---



YUKON GOLD CORPORATION, INC.

(An Exploration Stage Company) 
Condensed Notes to Interim Consolidated Financial Statements 
July 31, 2007 
(Amounts expressed in US Dollars) 
(Unaudited)

7. ISSUANCE OF COMMON SHARES-Contd



On October 3, 2006, the Company completed another brokered private placement and
issued 550,000 units, where each unit consisted of a common share and a share
purchase warrant. The units were priced at $1.00 per unit for a total of
$550,000. The Company paid a finders fee of $33,000 and reimbursed expenses for
$18,022 (CDN$20,000). The warrants have a two-year term and are exercisable at
$1.50 per share in the first twelve months of the term and $2.00 per share in
the remaining twelve months of the term.



On December 12, 2006 the Company issued 50,000 shares to a former officer upon
exercising of 50,000 vested stock options at $0.75 for a total of $37,500.



On December 6, 2006 the board of directors authorized the issuance of 133,334
common shares in the amount of $100,000 for a property payment to Atna Resources
Ltd., along with a cash payment of $86,805 (CDN$100,000) as per terms of the
agreement. The common shares along with the cash payment were delivered to Atna
Resources Ltd. on December 12, 2006. This entire payment of $186,805 was
expensed in the consolidated statements of operations.

On December 19, 2006 the Company issued 160,000 common shares to a consultant
for services rendered. These services related to the consulting agreement dated
March 21, 2006. As per terms of that agreement, the Consultant was to provide to
the Company market and financial advice and expertise as may be necessary
relating to the manner of offering and pricing of securities. The agreement was
for a period of twelve months commencing the day of trading of the Companys
stock on the Toronto Stock Exchange (April 19, 2006). As per the agreement, the
Consultant was to be compensated a fee equal to 240,000 restricted common shares
of the Company with a fair value of $196,800 and was to receive these shares on
a monthly basis. Each party was able to cancel the agreement on 30 days notice.
The Company cancelled the agreement as of November 30, 2006 and on December 19,
2006 issued 160,000 common shares as full and final consideration.



On December 19, 2006 the Company issued 200,000 common shares in lieu of sale of
200,000 Flow-Through Special Warrants made to a Canadian accredited investor,
for $180,000 (CDN$205,020) on December 30, 2005. Each Flow-Through Special
Warrant entitled the Holder to acquire one flow-through common share of the
Company at no additional cost.



On December 28, 2006, the Company completed a private placement of 2,823,049
flow-through special warrants (which qualify as flow-through shares for the
purposes of the Canadian Income Tax Act) at a price of $0.90 (CDN$1.05) per
warrant and 334,218 unit special warrants at a price of $0.77 (CDN$0.90) per
warrant for aggregate gross proceeds to the Company of $2,801,610
(CDN$3,264,996).  Each flow-through special warrant entitles the holder to
acquire, for no additional consideration, one common share of the Company.  Each
unit special warrant entitles the holder to acquire, for no additional
consideration, one common share and one common share purchase warrant of the
Company.  Each common share purchase warrant entitles the holder to acquire one
common share of the Company at a price of $0.90 (CDN$1.05) for a period of 24
months from the closing date.  In connection with this private placement, the
Company agreed to file a prospectus in Canada qualifying the issuance of the
common shares and warrants issuable upon the exercise of the special warrants as
well as those common shares issuable on exercise of the common share purchase
warrants. In addition, the Company agreed to file a registration statement in
the United States covering the re-sale of common shares underlying the units and
warrants by the respective shareholders.  The Company subsequently declined to
file a prospectus in Canada but did file the registration statement in the
United States.  As a result of the Companys decision not to file a prospectus
in Canada, primarily because of the cost involved, the Company was obligated to
pay a penalty to the holders of the securities issued in the private placement. 
As a result of the penalty, (i) each flow-through special warrant entitles the
holder to acquire 1.1 common shares on exercise thereof and (ii) each unit
special warrant entitles the holder to acquire 1.1 common shares and 1.1 common
share purchase warrants on exercise thereof.  In connection with the private
placement, Northern Securities Inc., the lead agent, received a cash commission
of $171,164 (CDN$198,550) as well as 169,042 flow-through compensation options
and 23,395 unit compensation options.  In addition, as part of the private
placement, Limited Market Dealer Inc. received a cash commission of $25,862
(CDN$30,000) as well as 28,571 flow-through compensation options and Novadan
Capital Ltd. received a cash payment of $28,362 (CDN$32,900) as well as 32,900
unit compensation options.  Each flow-through compensation option entitles the
holder to acquire, for no additional consideration, one flow-through
compensation warrant, each exercisable into one common share of the Company at a
price of $0.90 (CDN$1.05) for a period of 24 months from the closing date of
December 28, 2006.  Each unit compensation option entitles the holder to
acquire, for no additional consideration, one unit compensation warrant, each
exercisable at $0.81 (CDN$0.941) into one common share and one common share
purchase warrant of the Company at a price of $0.90 (CDN$1.05) for a
period of 24 months from the closing date of December 28, 2006.  As a result of
the penalty, (i) each flow-through compensation option entitles the holder to
acquire 1.1 flow-through compensation warrants on exercise thereof and (ii) each
unit compensation option granted to Northern Securities, Inc. entitles the
holder to acquire 1.1 unit compensation warrants on exercise thereof.  The
private placement was
exempt from registration under the Securities Act of 1933, as amended (the
Securities Act) pursuant to an exemption afforded by Regulation S promulgated
under the Securities Act (Regulation S).



---



YUKON GOLD CORPORATION, INC.

(An Exploration Stage Company) 
Condensed Notes to Interim Consolidated Financial Statements 
July 31, 2007 
(Amounts expressed in US Dollars) 
(Unaudited)

7.  ISSUANCE OF COMMON SHARES-Contd



On January 11, 2007, the Company issued its obligated 400,000 common shares and
an additional 4,000 common shares as penalty, in lieu of sale of 400,000 Special
Warrants to a Canadian accredited investor for $404,000 paid on December 15,
2005. Each Special Warrant entitled its holder to acquire one common share of
the Company and one common share purchase warrant at no additional cost. The
Company was obligated to have a registration statement become effective within
181 days of the closing. In the absence of a registration statement being
declared effective within 181 days of the closing, the Company issued an
additional 4,000 common shares to the Canadian accredited investor at no extra
cost as a penalty.  The Company expensed an amount of $5,000 to registration
rights penalty expense under the head General and Administration and credited
this to Additional paid in capital.



On April 25, 2007 the Company issued 2,823,049 common shares and an additional
282,309 shares as a penalty, relating to the private placement of 2,823,049
flow-through special warrants on December 28, 2006 (refer to note above). The
penalty shares were issued as the Company failed to obtain receipts for the
final prospectus or effectiveness of the registration statement by February 26,
2007 (60 days from the closing date). The Company expensed an amount of $163,739
to registration rights penalty expense under the head General and Administration
and credited this to Additional paid in capital.



On April 25, 2007 the Company issued 334,218 common shares and an additional
33,423 shares as a penalty, relating to the private placement of 334,218 unit
special warrants on December 28, 2006 (refer to note above). The penalty shares
were issued as the Company failed to obtain receipts for the final prospectus or
effectiveness of the registration statement by February 26, 2007 (60 days from
the closing date). The Company expensed an amount of $19,386 to registration
rights penalty expense under the head General and Administration and credited
this to Additional paid in capital.



Three Months ended July 31, 2007



On July 7, 2007 the Company issued 136,364 common shares in settlement of a
property payment on the Mount Hinton property. The shares represent $57,252
(CDN$60,000) which is 40% of the contracted payment and were valued at $0.42
(CDN$0.44) each.



8.  COMMITMENTS AND CONTINGENCIES



(a)

Mount Hinton Property Mining Claims



On July 7, 2002 Yukon Gold Corp. (YGC) entered into an option agreement
    with the Hinton Syndicate to acquire a 75% interest in the 273 unpatented
    mineral claims covering approximately 14,000 acres in the Mayo Mining
    District of the Yukon Territory, Canada. This agreement was replaced with a
    revised and amended agreement (the Hinton Option Agreement) dated July 7,
    2005 which superseded the original agreement and amendments thereto. The new
    agreement is between the Company, its wholly owned subsidiary YGC and the
    Hinton Syndicate.



YGC must make scheduled cash payments and perform certain work commitments
    to earn up to a 75% interest in the mineral claims, subject to a 2% net
    smelter return royalty in favor of the Hinton Syndicate, as further
    described below.





---



YUKON GOLD CORPORATION, INC.

(An Exploration Stage Company) 
Condensed Notes to Interim Consolidated Financial Statements 
July 31, 2007 
(Amounts expressed in US Dollars) 
(Unaudited)

8.   COMMITMENTS AND CONTINGENCIES - Contd



The schedule of Property Payments and Work Programs are as follows:

PROPERTY PAYMENTS

|On execution of the July 7, 2002 Agreement | $ 19,693  (CDN$   25,000)  Paid
|------------------------------------------ | -------------------------------
|On July 7, 2003                            | $ 59,078  (CDN$   75,000)  Paid
|On July 7, 2004                            | $118,157 (CDN$ 150,000)  Paid  
|On January 2, 2006                         | $125,313 (CDN$ 150,000)  Paid  
|On July 7, 2006                            | $134,512 (CDN$ 150,000)  Paid  
|On July 7, 2007                            | $141,979 (CDN$ 150,000)  Paid  
|On July 7, 2008                            | $140,607 (CDN$ 150,000)        
|TOTAL                                      | $739,339 (CDN$850,000)         



WORK PROGRAM-expenditures to be incurred in the following periods;

|July 7/02 to July 6/03  | $ 118,157   (CDN$    150,000) Incurred
|----------------------- | --------------------------------------
|July 7/03 to July 6/04  | $ 196,928   (CDN$    250,000) Incurred
|July 7/04 to July 6/05  | $ 256,006   (CDN$    325,000) Incurred
|July 7/05 to Dec. 31/06 | $ 667,795   (CDN$    750,000) Incurred
|Jan. 1/07 to Dec. 31/07 | $ 937,383   (CDN$ 1,000,000) Incurred 
|Jan. 1/08 to Dec. 31/08 | $1,171,729 (CDN$ 1,250,000)           
|Jan. 1/09 to Dec. 31/09 | $1,406,074 (CDN$ 1,500,000)           
|TOTAL                   | $4,754,072(CDN$5,225,000)             



By letter agreement dated August 17, 2006, the Hinton Syndicate agreed to allow
the Company to defer a portion of the Work Program expenditure scheduled to be
incurred by December 31, 2006. The agreement to defer such Work program
expenditures was due to the mechanical break-down of drilling equipment and the
unavailability of replacement drilling equipment at the Mount Hinton site. As a
result, the Company was allowed to defer the expenditure of approximately
$220,681 (CDN$235,423) until December 31, 2007. All other Property Payments and
Work Program expenditures due have been made and incurred.

Provided all Property Payments have been made that are due prior to the Work
Program expenditure levels being attained, YGC shall have earned a:

25% interest upon completion of Work Program expenditures of $1,262,321
(CDN$1,500,000)



50% interest upon completion of Work Program expenditures of $2,343,457
(CDN$2,500,000)



75% interest upon completion of Work Program expenditures of $4,754,072
(CDN$5,225,000)



YGC has attained a 25% interest as at July 31, 2007. In some cases, payments
made to service providers include amounts advanced to cover the cost of future
work. These advances are not loans but are considered "incurred" exploration
expenses under the terms of the Hinton Option Agreement. Section 2.2(a) of the
Hinton Option Agreement defines the term, incurred as follows:  Costs
shall be deemed to have been incurred when YGC has contractually obligated
itself to pay for such costs or such costs have been paid, whichever should
first occur. Consequently, the term, incurred includes amounts actually paid
and amounts that YGC has obligated itself to pay. Under the Hinton Option
Agreement there is also a provision that YGC must have raised and have available
the Work Program funds for the period from July 7, 2005 to December 31, 2006, by
May 15 of 2006. This provision was met on May 15, 2006.



The Hinton Option Agreement contemplates that upon the earlier of: (i) a
production decision or (ii) investment of $4,754,072 (CDN$5,225,000) or (iii)
YGC has a minority interest and decides not to spend any more money on the
project, YGCs relationship with the Hinton Syndicate will become a joint
venture for the further development of the property. Under the terms of the
Hinton Option Agreement, the party with the majority interest would control the
joint venture. Once the 75% interest is earned, as described above, YGC has a
further option to acquire the remaining 25% interest in the mineral claims for a
further payment of $4,686,914 (CDN$5,000,000).

The Hinton Option Agreement provides that the Hinton Syndicate receive a 2% net
smelter return royalty. In the event that the Company exercises its option to
buy-out the remaining 25% interest of the Hinton Syndicate (which is only
possible if the Company
has reached a 75% interest, as described above) then the "net smelter return
royalty" would become 3% and the Hinton Syndicate would retain this royalty
interest only. The net smelter return royalty is a percentage of the gross
revenue received from the sale of the ore produced from the mine less certain
permitted expenses.

---



YUKON GOLD CORPORATION, INC.

(An Exploration Stage Company) 
Condensed Notes to Interim Consolidated Financial Statements 
July 31, 2007 
(Amounts expressed in US Dollars) 
(Unaudited)

8.   COMMITMENTS AND CONTINGENCIES - Contd

The Hinton Option Agreement entitles the Hinton Syndicate to recommend for
appointment one member to the board of directors of the Company.



The Hinton Option Agreement provides both parties (YGC and Hinton Syndicate)
with rights of first refusal in the event that either party desires to sell or
transfer its interest.



The Hinton Syndicate members each have the option to receive their share of
property payments in stock of the Company at a 10% discount to the market, once
the Company has obtained a listing on a Canadian stock exchange. YGC and the
Company have a further option to pay 40% of any property payment due after the
payment on January 2, 2006 with common stock of the Company. On July 7, 2007 the
Company issued 136,364 common shares, with the approval of the TSX,  in
settlement of 40% of the property payment due on July 7, 2007. The shares
represent $57,252 (CDN$60,000) which is 40% of the contracted payment and were
valued at $0.42 (CDN$0.44) each.  The $84,727 (CDN$90,000) balance was paid in
cash to the members of the Hinton Syndicate on July 7, 2007. This entire
issuance of shares and cash payment was expensed as project expense.

The Hinton Syndicate Agreement pertains to an area of interest which includes
the area within ten kilometers of the outermost boundaries of the 273 mineral
claims, which constitute our mineral properties. Either party to the Hinton
Syndicate Agreement may stake claims outside the 273 mineral claims, but each
must notify the other party if such new claims are within the area of
interest. The non-staking party may then elect to have the new claims included
within the Hinton Syndicate Agreement. As of December 11, 2006, there were an
additional 24 claims staked, known as the Gram Claims which became subject to
the Hinton Syndicate Agreement.

On April 2, 2007 the Company accepted a proposed work program, budget and cash
call schedule for the Mount Hinton project which was revised on May 15, 2007,
totaling $1,410,949 (CDN$1,505,200) for the 2007 Work Program. The Company had
approximately $70,304 (CDN$75,000) on deposit left over from the 2006 cash call
schedule. On May 15, 2007 the Company paid $180,164 (CDN$200,000), on June 15,
2007 the Company paid $202,684 (CDN$225,000), being two of the four cash call
payments. Due to delays in the drilling program the third payment of $562,430
(CDN$600,000) which was due on July 31, 2007 was changed to August 31, 2007 and
was paid subsequently.  The fourth payment of $379,828 (CDN$405,200) which was
originally due on August 15, 2007 was changed to September 15, 2007.

b) The Marg Property

In March 2005, the Company acquired rights to purchase 100% of the Marg
Property, which consists of 402 contiguous mineral claims covering approximately
20,000 acres located in the Mayo Mining District of the Yukon Territory of
Canada. Title to the claims is registered in the name of YGC.



The Company assumed the rights to acquire the Marg Property under a Property
Purchase Agreement (Agreement) with Atna Resources Ltd. (Atna). Under the
terms of the Agreement the Company paid $119,189 (CDN$150,000) cash and 133,333
common shares as a down payment. The Company made payments under the Agreement
for $43,406 (CDN$50,000) cash and an additional 133,333 common shares of the
Company on December 12, 2005; $86,805 (CDN$100,000) cash and an additional
133,334 common shares of the Company on December 12, 2006.

The Company has agreed to make subsequent payments under the Agreement of: (i)
$93,738 (CDN$100,000) cash on or before December 12, 2007; and (ii) $187,477
(CDN$200,000) in cash and/or common shares of the Company (or some combination
thereof to be determined) on or before December 12, 2008. Upon the commencement
of commercial production at the Marg Property, the Company will pay to Atna
$937,383 (CDN$1,000,000) in cash and/or common shares of the Company, or some
combination thereof to be determined.



---



YUKON GOLD CORPORATION, INC.

(An Exploration Stage Company) 
Condensed Notes to Interim Consolidated Financial Statements 
July 31, 2007 
(Amounts expressed in US Dollars) 
(Unaudited)

8.   COMMITMENTS AND CONTINGENCIES - Contd

On April 2, 2007 the Company accepted a proposed work program, budget and cash
call schedule for the Marg project totaling $2,980,877 (CDN$3,180,000) for the
2007 Work Program. The Company had approximately $515,561 (CDN$550,000) on
deposit left over from the 2006 cash call schedule. On May 15, 2007 the Company
paid $703,037 (CDN$750,000), on June 15, 2007 the Company paid $703,037
(CDN$750,000), and on July 15, 2007 the Company paid $703,037 (CDN$750,000)
being three of the four cash call payments. The fourth payment of $356,205
(CDN$380,000) is due on August 15, 2007 and was paid subsequently.



c) On July 23, 2007, Yukon Gold Corporation, Inc. (the Company) amended and
restated an agreement with Northern Securities Inc. (Northern) pursuant to
which Northern agreed to act as agent in connection with a $2,624,672
(CDN$2,800,000) private placement (the Private Placement).  Northern agreed to
place or purchase for its own account $1,406,704 (CDN$1,500,000) in Units and
$1,218,598 (CDN$1,300,000) of flow-through units (the Flow-Through Units).
 Each Unit consists of one common share and one-half common share purchase
warrant (a Warrant).  Each Flow-Through Unit consists of one flow-through
common share and one half of a common share purchase warrant where each full
warrant will enable its holder to purchase a non-flow-through share (a
Flow-Through Warrant).  The flow-through shares entitle Canadian tax payers
to certain tax credits which may be offset against Canadian income tax.  The
Units were priced at $0.42 (CDN$0.45) per Unit.  Each whole Warrant (two half
Warrants together) will be exercisable for one share of the Companys common
stock for a period of 24 months from the closing of the private placement at an
exercise price of $0.56 (CDN$0.60) per share.  The Flow-Through Units are priced
at $0.49 (CDN$0.52) per Flow-Through Unit.  Each whole Flow-Through Warrant will
be exercisable into one share of the Companys common stock  for a period of 24
months from the Closing Date at an exercise price of $0.66 (CDN$0.70) per share.
 In connection with the Northern Agreement, the Company agreed to pay Northern a
commission equal to 8% of the aggregate gross proceeds of the Private Placement
and issue to Northern broker warrants in the amount of 8% of the aggregate
number of Units and Flow-Through Units purchased through the Private Placement.
  In addition, the Company agreed to pay Northern a due diligence fee of $70,304
(CDN$75,000).  The Private Placement is scheduled to close in two parts.  The
first closing occurred on August 16, 2007 for aggregate gross proceeds of
$1,073,425 (CDN$1,145,180). (See Note 12  Subsequent Events).



9. SHORT-TERM INVESTMENT IN AVAILABLE- FOR- SALE SECURITIES



The Company entered into a subscription agreement dated as of April 3, 2007 (the
Agreement) with Industrial Minerals, Inc. (Industrial Minerals) to acquire (i)
5,000,000 common shares of Industrial Minerals at a price of $0.05 per share and
(ii) a Warrant entitling the holder: (a) to purchase 5,000,000 common shares of
Industrial Minerals at a purchase price of $0.05 per share (the option price)
or, at the option of the holder, (b) to surrender the Warrant for a number of
common shares to be determined by application of a formula which would result in
a larger number of shares issued to the holder if the market price of the common
stock is less than the option price at the time of exercise. The Warrant expires
on April 3, 2008. The total subscription price paid by the Company was $250,000.
The Company entered into the Agreement as of May 14, 2007. The common stock of
Industrial Minerals is quoted on the Over-the-Counter Bulletin Board under the
symbol, IDSM. The Company accounted for this investment as a short term
investment in available-for-sale securities. The unrealized gain of $100,000 as
at July 31, 2007 has been excluded from earnings and reported as Other
Comprehensive Income. The Company executed an agreement to sell the securities
on August 17, 2007 (See Note 12- Subsequent Events).

10. PREPAID EXPENSES AND OTHER



Included in prepaid expenses and other is an amount of $83,915 (CDN$89,520)
being Goods & Services tax receivable from the Federal Government of Canada.
Included in prepaid expenses and other is a deposit of $1,932,019 (CDN
$2,061,078) with a geological company for conducting exploration activities at
the Mount Hinton and Marg properties.



11. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES



The Company entered into a one year consulting agreement with a consultant on
December 28, 2006 commencing January 1, 2007. As per terms of the agreement, the
consultant was to provide consulting services which included market awareness,
financial and strategic advice. The Company was to compensate the consultant a
fee of 500,000 restrictive shares over a period of twelve months with shares to
be delivered on a monthly basis. The Company had accrued the cost of $136,668 in
the April 30, 2007 statements, although in the opinion of the Company, it was
not obligated to issue stock as the consultant was in breach of the contract due
to non performance of
the agreed services. The Company received a cancellation and waiver of the
agreement from the consultant and reversed this accrual to the credit of general
and administrative expense during the quarter ended July 31, 2007.



---



YUKON GOLD CORPORATION, INC.

(An Exploration Stage Company) 
Condensed Notes to Interim Consolidated Financial Statements 
July 31, 2007 
(Amounts expressed in US Dollars) 
(Unaudited)

12.   SUBSEQUENT EVENTS



a)   Subsequent issue of common shares:

On August 16, 2007 the Company completed a private placement (the Financing)
with Northern Securities Inc. (Northern), acting as agent. The Financing was
comprised of the sale of 1,916,666 units (the Units) at $0.42 (CDN$0.45) per
Unit (the Unit Issue Price) for gross proceeds of $808,446  (CDN$862,499.70)
and the sale of 543,615 flow-through units (the Flow-Through Units) at $0.49
(CDN$0.52) per Flow-Through Unit (the Flow-Through Unit Issue Price) for gross
proceeds of $264,979 (CDN$282,679.80), raising aggregate gross proceeds of
approximately $1,073,425 (CDN$1,145,180).  Each Unit consisted of one non-flow
through common share ("Common Share") and one half of one Common Share purchase
warrant (each whole warrant, a "Warrant").  Each Warrant is exercisable into one
Common Share until August 16, 2009 at an exercise price of $0.56 (CDN$0.60) per
share.  Each Flow-Through Unit consisted of one flow-through common share and
one half of one Common Share purchase warrant (each whole warrant, an "FT
Warrant").  Each FT Warrant is exercisable into one Common Share until August
16, 2009 at an exercise price of $0.66 (CDN$0.70) per share.  Yukon Gold paid
Northern a commission equal to 8% of the aggregate gross proceeds and issued
153,333 Unit Compensation Options and 43,489 FT Unit Compensation Options.
 Each Unit Compensation Option is exercisable into one Unit at the Unit Issue
Price until August 16, 2009.  Each FT Unit Compensation Option is exercisable
into one Common Share and one half of one FT Warrant at the Flow-Through Unit
Issue Price until August 16, 2009.  Yukon Gold has also granted Northern an
option (the "Over-Allotment Option") exercisable until October 15, 2007 to offer
for sale up to an additional $468,691 (CDN$500,000) of Units and/or Flow-Through
Units on the same terms and conditions.  The Company paid a $70,304 (CDN$75,000)
due diligence fee to Northern at closing and reimbursed Northern for its
expenses.  The proceeds of the Financing will be used for the exploration and
development of the Companys two Yukon Territory based properties, and for
working capital.

b)  Subsequent Commitments & Contingencies:

On August 15 the Company entered into an on-line investor relations marketing
agreement with a consultant for a one year term, with the option to renew for an
additional 12 months.  In return for services rendered, the Company will pay the
consultant $1,875 (CDN$2,000) per month.  In addition, the consultant has been
granted an option to purchase 125,000 shares of the Company at $0.42 (CDN$0.45)
per share, with the option vesting in equal quarterly amounts of 31,250 shares
on November 15, 2007, February 15, 2008, May 15, 2008 and August 15, 2008, and
the first exercise date being August 15, 2008 and an expiry date of August 15,
2010.



On August 15, 2007 the Company paid $365,205 (CDN$380,000), being the fourth and
final payment for the Marg Project 2007 Work Program.

On August 15, 2007 the Company paid $86,127 (CDN$91,880.20) towards the third
cash call payment for the Mount Hinton 2007 Work Program. On August 31, 2007 the
Company re-allocated $476,303 (CDN$508,119.80) being the balance of the third
cash call payment for the Mount Hinton 2007 Work Program from cash call funds
previously allocated to the Marg Project. These re-allocated funds are not
presently needed for the Marg Project.

On August 17, 2007, the Company entered into an agreement with Global Capital
SPE-1 LLC (Global) pursuant to which Global agreed to purchase 2 million
shares of Industrial Minerals Inc. (IDSM) held by the Company for
consideration of $140,000.  Pursuant to the Agreement, Global has the option to
purchase from the Company an additional 3 million shares of IDSM for
consideration of $210,000.  The Company also assigned to Global 5 million
warrants to purchase IDSM stock.  The Company will receive up to $100,000 in the
event that Global exercises all or a portion of the warrants.  Global
consummated the purchase of the first 2 million shares of IDSM on September 6,
2007.



c) The Company announced on September 5, 2007 that its common stock will trade
on the Frankfurt Stock Exchange.  The Companys common stock will trade under
the symbol W8Y and the German Securities Code A0JJ6Z.



---



MANAGEMENT'S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATION

FOR THE THREE MONTH PERIOD ENDED JULY 31, 2007



Discussion of Operations & Financial Condition

Three months ended July 31, 2007

Yukon Gold has no source of revenue and we continue to operate at a loss. We
expect our operating losses to continue for so long as we remain in an
exploration stage and perhaps thereafter. As at July 31, 2007, we had
accumulated losses of $7,987,926. These losses raise substantial doubt about our
ability to continue as a going concern. Our ability to emerge from the
exploration stage and conduct mining operations is dependent, in large part,
upon our raising additional equity financing.

As described in greater detail below, the Companys major endeavor over the
quarter ended July 31, 2007 has been its effort to raise additional capital to
meet its ongoing obligations under both the Hinton Syndicate Agreement and the
Marg Acquisition Agreement and to pursue its exploration activities.



Having obtained material financing, we implemented exploration programs at both
the Mount Hinton and Marg Properties.

SELECTED INFORMATION

|                                  | July 31, 2007 |           | July 31, 2006 |  
|--------------------------------- | ------------- | --------- | ------------- | -
|Revenues                          |               | Nil       |               |  
|Net Loss                          | $             | 1,052,544 |               | $
|Loss per share-basic and diluted  | $             | (0.05     | )             | $
|Total Assets                      | $             | 3,373,931 |               | $
|Total Liabilities                 | $             | 159,071   |               | $
|Cash dividends declared per share |               | Nil       |               |  



The total assets for the three months ended July 31, 2007 includes cash and cash
equivalents for $256,223, prepaid expenses and other for $2,225,787, exploration
tax credit receivable for $483,258, short term investment in available-for -sale
securities for $350,000 and capital assets for $58,663. The total assets for the
 quarter ended July 31, 2006 includes cash and cash equivalents for $889,565,
restricted deposit for $17,889 and capital assets for $59,263.



Revenues



No revenue was generated by the Companys operations during the quarter ended
July 31, 2007 and the quarter ended July 31, 2006.



Net Loss



The Companys expenses are reflected in the Consolidated Statements of
Operations under the category of Operating Expenses. To meet the criteria of
United States generally accepted accounting principles (GAAP), all exploration
and general and administrative costs related to projects are charged to
operations in the year incurred.

The significant components of expense that have contributed to the total
operating expense are discussed as follows:

(a) General and Administrative Expense



Included in operating expenses for the quarter ended July 31, 2007 is general
and administrative expense of $74,886, as compared to $553,682 for the quarter
ended July 31, 2006. General and administrative expense represents approximately
7% of the total operating expense for the quarter ended July 31, 2007 and
approximately 39% of the total operating expense for the quarter ended July 31,
2006. General and administrative expense for the quarter ended July 31, 2007 was
credited with $136,668 being the reversal of liability created during the year
ended April 30, 2007 for consultancy expense exposure which was cancelled in
July 2007.

---



(b) Project Expense



Included in operating expenses for the quarter ended July 31, 2007 is project
expenses of $974,725 as compared with $871,887 for the quarter ended July 31,
2006. Project expense is a significant expense and it represents approximately
93% of the total operating expense for the quarter ended July 31, 2007 and
approximately 61% of the total operating expense for the quarter ended July 31,
2006. Project expense increased by $102,838 in the quarter ended July 31, 2007,
as compared to the quarter ended July 31, 2006. The increase in this expense is
mainly due to the additional expenses incurred by the Company on exploration of
both the Mount Hinton Property claims and its Marg Property in the Yukon
Territory of Canada. During the quarter ended July 31, 2007, the Company made a
property payment of $141,979 (CDN $150,000) to the Hinton Syndicate, which was
paid partly in cash and partly by the issue of 136,364 common shares.



Exploration at Mount Hinton



While high grade gold-silver veins were discovered and sampled by United Keno
Hill Mines (UKHM) mainly during the period between 1965 and 1968, the Mount
Hinton Property has received very little modern exploration and the full
economic potential remains largely untested. Past efforts to fully evaluate the
vein structures were frustrated by the steep terrain and difficult overburden
conditions.

During the summer of 2006, we undertook an exploration program to delineate the
vertical and lateral extent of some of the known vein structures at the site
utilizing a new and improved reverse circulation drill and to carry out the
geochemical surveys, prospecting and trenching that would help identify
additional mineralized targets for future drilling and exploration programs. A
second objective of the summer 2006 exploration program was to determine whether
it would be more effective and feasible to evaluate the deposits by diamond
drilling from an underground adit/ramp and where best to locate this underground
development if feasible. Due to equipment failures the 2006 drilling program was
cancelled prior to completion of any of the planned drill holes.



On April 2, 2007 the Company accepted a proposed work program, budget and cash
call schedule for the Mount Hinton project which was revised on May 15, 2007,
totaling $1,410,949 (CDN$1,505,200) for the 2007 Work Program. The Company had
approximately $70,304 (CDN$75,000) on deposit left over from the 2006 cash call
schedule. On May 15, 2007 the Company paid $180,164 (CDN$200,000), on June 15,
2007 the Company paid $202,684 (CDN$225,000), being two of the four cash call
payments. Due to delays in the drilling program the third payment of $562,430
(CDN$600,000) which was due on July 31, 2007 was changed to August 31, 2007 and
was paid subsequently.  The fourth payment of $379,828 (CDN$405,200) which was
originally due on August 15, 2007 was changed to September 15, 2007.



With respect to the Option agreement between Yukon Gold and the Hinton
Syndicate, Yukon Gold will earn a 75% interest in the property by making
property payments of $739,339 (CDN$850,000) and spending $4,754,072
(CDN$5,225,000) on the property. Having received permission from the Hinton
Syndicate to move the unused portion of the summer 2006 work program commitment
to the 2007 summer work program the Company is up to date with its financial
commitments with respect to the Mount Hinton Property, and as at July 31, 2007
the Company has attained a 25% interest.

The Hinton Syndicate Agreement pertains to an area of interest which includes
the area within ten kilometers of the outermost boundaries of the 273 mineral
claims, which constitute our mineral properties. Either party to the Hinton
Syndicate Agreement may stake claims outside the 273 mineral claims, but each
must notify the other party if such new claims are within the area of
interest. The non-staking party may then elect to have the new claims included
within the Hinton Syndicate Agreement. As of December 11, 2006, there were an
additional 24 claims staked, known as the Gram Claims which became subject to
the Hinton Syndicate Agreement.

A drill rig was contracted to be on-site in mid-June, yet as of the end of this
quarter the equipment is still delayed.  Depending on the results and success of
the 2007 program and Yukon Golds ability to raise sufficient funds, a decision
will be made in late 2007, as to which of the following programs are warranted.
The options are as follows:

|1. | Continue drilling to further evaluate the known vein systems as well as
    other targets that may have resulted from the 2006 geochemical surveys and
    prospecting program, or
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                   

---



|2. | Develop an underground ramp from which diamond drilling and underground
    testing of some of the vein systems can be carried out, or                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|3. | Convert to a Joint Venture arrangement with the Hinton Syndicate as provided
    in the Hinton Syndicate Agreement whereby Yukon Gold would retain a 25%
    interest in the property having met the expenditure of $1,262,321
    (CDN$1,500,000) in work programs on the Mount Hinton Property. Yukon Gold
    must spend $937,383 (CDN$1,000,000) in 2007 plus the deferred expenditures
    of approximately $220,691 (CDN$235,423) as referred to above, in order to
    meet its work obligation under the Mount Hinton Agreement, unless it elects
    to convert to the joint venture arrangement.



Exploration at Marg Property

During the summer of 2006, we undertook an exploration program at the Marg
Property to extend the currently known resources toward a target of 9 to 10
million tons, which we believe to be the required threshold to proceed with the
next stage of their development which includes a definitive feasibility study.
To date, only partial results as to the grades of the mineralized zones
intersected by the diamond drilling have been received and therefore the full
impact of the drilling program on the resource estimates cannot be estimated at
this time.



The reader is cautioned that we have no known body of commercial ore. The
following drilling results are not considered a reserve as that term is used
in the mining industry. The preliminary resource must be further defined and the
Company must undertake a feasibility study of the results (if a feasibility
study is warranted) before we will know whether an economically viable resource
exists at any of our properties.



In 2005 Peter Holbek made a 43-101 compliant resource calculation based on all
the drill results up to 1997 and estimated the following:



|Classification | Tonnes    | Cu%  | Pb%  | Zn%  | Ag g/t | Au g/t
|-------------- | --------- | ---- | ---- | ---- | ------ | ------
|Indicated      | 4,646,200 | 1.80 | 2.57 | 4.77 | 65.08  | 0.99  
|Inferred       | 880,800   | 1.55 | 1.90 | 3.75 | 50.42  | 0.95  



The drilling results of the nine holes drilled at the Marg Property in the
summer of 2006 were incorporated into the more conservative resource calculation
performed by R. Carne and G. Giroux in 2007 whose estimate at a 1% Cu content
cut-off are:



|Classification | Tonnes    | Cu%  | Pb%  | Zn%  | Ag g/t | Au g/t
|-------------- | --------- | ---- | ---- | ---- | ------ | ------
|Indicated      | 1,720,000 | 1.97 | 2.40 | 4.59 | 59.72  | 0.95  
|Inferred       | 4,800,000 | 1.81 | 2.28 | 4.64 | 54.47  | 0.77  



The discrepancy between these two estimates has yet to be addressed.



A total of $1,486,831 (CDN$1,750,000) was budgeted in 2006. The program was made
up of the following components and budgeted expenditures:

|                                 |             |            
|-------------------------------- | ----------- | -----------
|                                 | US$         | CDN$       
|·4400 metres of diamond drilling | $   727,409 | $   776,000
|·Geological support services     | $   284,027 | $   303,000
|·Airborne geophysical survey     | $   140,607 | $   150,000
|·Helicopter support              | $   179,337 | $   191,000
|·Field support and management    | $   309,337 | $   330,000
|                                 | $1,640,420  | $1,750,000 



---





On April 2, 2007 the Company accepted a proposed work program, budget and cash
call schedule for the Marg project totaling $2,980,877 (CDN$3,180,000) for the
2007 Work Program. The Company had approximately $515,561(CDN $550,000) on
deposit left over from the 2006 cash call schedule. On May 15, 2007 the Company
paid $703,037 (CDN$750,000), on June 15, 2007 the Company paid $703,037
(CDN$750,000), and on July 15, 2007 the Company paid $703,037 (CDN$750,000)
being three of the four cash call payments. The fourth payment of $356,205
(CDN$380,000) is due on August 15, 2007 and was paid subsequently.

Liquidity and Capital Resources



The following table summarizes the Companys cash flows and cash in hand:

|                                      | July 31, 2007 |           | July 31, 2006 |  
|------------------------------------- | ------------- | --------- | ------------- | -
|Cash and cash equivalent              | $             | 256,223   |               | $
|Working capital                       | $             | 3,165,501 |               | $
|Cash used in operating activities     | $             | (467,412  | )             | $
|Cash used in investing activities     | $             | (252,760  | )             | $
|Cash provided by financing activities | $             | -         |               | $



Off-Balance Sheet Arrangement

The Company has no Off-Balance Sheet Arrangement as of July 31, 2007.

Contractual Obligations and Commercial Commitments

In addition to the contractual obligations and commitments of the Company to
acquire its mineral properties as described in Note 8 to our Financial
Statements included with this report, the Company has additional commitments for
its office lease and to pay minimum lease payments under its capital lease.
Refer to our annual financial statements for April 30, 2007 for future
obligation payments.

Flow-Through Share Subscription



The Company entered into flow-through share subscription agreements during the
year ended April 30, 2007 whereby it is committed to incur on or before December
31, 2007, a total of $2,543,505 (CDN$2,964,200) of qualifying Canadian
Exploration expenses as described in the Income Tax Act of Canada. As of April
30, 2007 an expenditure of $133,363 (CDN$148,046) had been incurred and as of
the quarter ended July 31, 2007 $852,352 (CDN$909,289) has been incurred
resulting in $1,787,462 (CDN$1,906,865) not yet being spent. Commencing March 1,
2007 the Company was liable to pay a tax of approximately 5% per annum,
calculated monthly on the unspent portion of the commitment.



Consulting Agreement



The Company entered into a one year consulting agreement with a consultant on
December 28, 2006 commencing January 1, 2007. As per terms of the agreement, the
consultant was to provide consulting services which included market awareness,
financial and strategic advice. The Company was to compensate the consultant a
fee of 500,000 restrictive shares over a period of twelve months with shares to
be delivered on a monthly basis. The Company had accrued the cost of $136,668 in
the April 30, 2007 statements, although in the opinion of the Company, it was
not obligated to issue stock as the consultant was in breach of the contract due
to non performance of the agreed services. The Company received a cancellation
and waiver of the agreement from the consultant and reversed this accrual to the
credit of general and administrative expense during the quarter ended July 31,
2007.



---





Critical Accounting Policies



The preparation of financial statements in accordance with accounting principles
generally accepted in the United States of America requires us to make estimates
and assumptions that affect reported amounts of assets and liabilities at the
date of the financial statements, the reported amount of revenues and expenses
during the reporting period and related disclosure of contingent assets and
liabilities. On an ongoing basis, we evaluate our estimates and judgments,
particularly those related to the determination of the estimated Canadian
exploration tax credit receivable and accrued liabilities. To the extent actual
results differ from those estimates, our future results of operations may be
affected. Besides this critical accounting policy on use of estimates, we
believe the following critical accounting policy affects the preparation of our
consolidated financial statements.



Acquisition, Exploration and Evaluation Expenditures



The Company is an exploration stage mining company and has not yet realized any
revenue from its operations. It is primarily engaged in the acquisition,
exploration and development of mining properties. Mineral property acquisition
and exploration costs are expensed as incurred. When it has been determined that
a mineral property can be economically developed as a result of establishing
proven and probable reserves, the costs incurred to develop such property, are
capitalized. For the purpose of preparing financial information, all costs
associated with a property that has the potential to add to the Companys proven
and probable reserves are expensed until a final feasibility study demonstrating
the existence of proven and probable reserves is completed. No costs have been
capitalized in the periods covered by these financial statements. Once
capitalized, such costs will be amortized using the units-of-production method
over the estimated life of the probable reserve.

CONTROLS AND PROCEDURES



(a)

Disclosure Controls and Procedures.  The Company's management, with the
participation of the principal executive officer and principal financial
officer, respectively, has evaluated the effectiveness of the Company's
disclosure controls and procedures (as such term is defined  in Rules  13a-15(e)
and 15d-15(e) under the  Securities Exchange Act of 1934, as amended  (the
 "Exchange  Act") as at July 31, 2007.  Based on such evaluation, the principal
executive officer and principal financial officer of the Company, respectively,
have concluded that, as of the end of the current quarter, the Company's
disclosure controls and procedures are effective.



(b)

Internal Control Over Financial Reporting.  There have not been any
changes in the Company's internal control over financial reporting (as such term
is defined in Rules 13a-15(f) and 15d-15(f)  under the Exchange  Act) during the
quarter ended July 31, 2007 that have materially affected, or are reasonably
likely to materially affect, the Company's internal control over financial
reporting.



(c)

Limitations on the Effectiveness of Controls.  We believe that a control
system, no matter how well designed and operated, cannot provide absolute
assurance that the objectives of the control system are met, and no evaluation
of controls can provide absolute assurance that all control issues and instances
of fraud, if any, within a company have been detected.



RISK FACTORS

1.

WE DO NOT HAVE AN OPERATING BUSINESS.



The Company has rights in certain mineral claims located in the Yukon Territory,
Canada.  To date we have done limited exploration of the property covered by our
mineral claims.  We do not have a mine or a mining business of any kind.  There
is no assurance that we will develop an operating business in the future.



2.

WE HAVE NO SOURCE OF OPERATING REVENUE AND EXPECT TO INCUR SIGNIFICANT EXPENSES
BEFORE ESTABLISHING AN OPERATING COMPANY, IF WE ARE ABLE TO ESTABLISH AN
OPERATING COMPANY AT ALL.



Currently, we have no source of revenue, we do not have sufficient working
capital to complete our exploration programs (including feasibility studies) and
we do not have any commitments to obtain additional financing.  Further, we do
not have enough working capital to meet all of our contractual commitments to
acquire our mineral properties.  We have no operating history upon which an
evaluation of our future success or failure can be made.  Our ability to achieve
and maintain profitability and positive cash flow is dependent upon:

---







further exploration of the Mount Hinton Property and the results of that
exploration;



our ability to raise the capital necessary to conduct this exploration and
preserve our interest in these mineral claims; and



our ability to raise capital to develop the Marg Property, establish a mining
operation, and operate this mine in a profitable manner.

Because we have no operating revenue, we expect to incur operating losses in
future periods as we continue to expend funds to explore and develop the Mount
Hinton and Marg Properties.  Failure to raise the necessary capital to continue
exploration and development could cause us to go out of business.

3.

OUR STOCK PRICE WILL BE HEAVILY INFLUENCED BY THE RESULTS OF DRILLING TESTS.



We cannot predict the results of the drilling tests as exploration of our
properties proceeds.    The results of these tests will heavily influence our
decisions on further exploration at the Marg Property and the Mount Hinton
Property and are likely to affect the trading price of our stock.

4.

IF WE DEVELOP OTHER MINERAL RESOURCES, THERE IS NO GUARANTEE THAT PRODUCTION
WILL BE PROFITABLE.



Even if we find other commercial mineral resources, there is no assurance that
we will be able to mine them or that a mining operation would be profitable on
any of our properties.  No feasibility studies have been conducted as of the
date of this report.



5.

WE MUST MAKE REGULAR ONGOING INVESTMENTS IN ORDER TO MAINTAIN OUR MINERAL
CLAIMS.

We have an option agreement with a private syndicate, known as the Hinton
Syndicate, to acquire an interest in the mineral claims described in this report
as the "Mount Hinton Property".  Our agreement with the Hinton Syndicate
requires us to make regular ongoing investments.  If we fail to make these
investments, we will not earn an interest in these mineral claims and we may
lose all of our rights in the Mount Hinton Property.  The Marg Acquisition
Agreement also requires the Company to make material deferred payments on
December 12 of 2007 and 2008.  If we are unable to raise sufficient capital to
make these payments we may lose all of our rights in the Marg Property.

6.

WEATHER INTERRUPTIONS IN THE YUKON TERRITORY MAY DELAY OUR PROPOSED EXPLORATION
OPERATIONS.



Weather factors will significantly affect our exploration efforts.  Currently,
we can only work above ground at the Mount Hinton and Marg Properties from late
May until early October of each year, depending upon how early snowfall occurs.



7.

WE COULD ENCOUNTER REGULATORY AND PERMITTING DELAYS.



We could face delays in obtaining permits to operate on the Mount Hinton and
Marg Properties.  Such delays could jeopardize financing, if any is available,
in which case we would have to delay or abandon work on one or both of the
properties.



8.

GOING CONCERN QUALIFICATION



The Company has included a going concern qualification in the Consolidated
Interim Financial Statements to the effect that we are an exploration stage
company and have no established sources of revenue.  In the event that we are
unable to raise additional capital and/or locate mineral resources, as to which
in each case there can be no assurance, we may not be able to continue our
operations.  In addition, the existence of the going concern qualification in
our auditors report may make it more difficult for us to obtain additional
financing.  If we are unable to obtain additional financing, you may lose all or
part of your investment.

---





9.

THERE ARE PENNY STOCK SECURITIES LAW CONSIDERATIONS THAT COULD LIMIT YOUR
ABILITY TO SELL YOUR SHARES.



Our common stock is considered a "penny stock" and the sale of our stock by you
will be subject to the "penny stock rules" of the Securities and Exchange
Commission.  The penny stock rules require broker-dealers to take steps before
making any penny stock trades in customer accounts.  As a result, our shares
could be illiquid and there could be delays in the trading of our stock which
would negatively affect your ability to sell your shares and could negatively
affect the trading price of your shares.

10.

OUR BUSINESS IS AFFECTED BY CHANGES IN COMMODITY PRICES.



Our ability to develop our mineral properties and the future profitability of
the Company is directly related to the market price of certain minerals.  The
sharp rise in commodity prices over the past year has resulted in increased
investor interest in mineral exploration companies.  The Company has benefited
from this trend, but like other companies in this sector, the Company would be
negatively affected if commodity prices were to fall.



11.

OUR BUSINESS IS SUBJECT TO CURRENCY RISKS.



The Company conducts the majority of its business activities in Canadian
dollars.  Consequently, the Company is subject to gains or losses due to
fluctuations in Canadian currency relative to the U.S. dollar.



DISCLOSURE AND FINANCIAL CONTROLS AND PROCEDURES



In connection with the Companys compliance with securities laws and rules, its
board of directors evaluated the Companys disclosure controls and procedures.
 The board of directors has concluded that the Companys disclosure controls and
procedures are effective.  There have been no significant changes in these
controls or in other factors that could significantly affect these controls
subsequent to the date of their evaluation, including any corrective actions
with regard to significant deficiencies and material weaknesses.



Internal financial controls and procedures have been designed under the
supervision of the Companys board of directors and reviewed by an independent
auditor.  The internal financial controls provide reasonable assurance regarding
the reliability of the Companys financial reporting and preparation of
financial statements in accordance with generally accepted accounting
principals.  There have been no significant changes in these controls or in
other factors that could significantly affect these controls since they were
instituted, including any corrective actions with regard to significant
deficiencies and material weaknesses.



---





PART II-OTHER INFORMATION



Item 1.

LEGAL PROCEEDINGS



None.



Item 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS



On July 7, 2007 the Company issued 136,364 common shares in settlement of a
property payment to the Hinton Syndicate for the Mount Hinton property. The
shares represent $57,252 (CDN$60,000) which is 40% of the contracted payment and
were valued at $0.42 (CDN$0.44) each.



On August 16, 2007 the Company completed a private placement (the Financing)
with Northern Securities Inc. (Northern), acting as agent. The Financing was
comprised of the sale of 1,916,666 units (the Units) at $0.42 (CDN$0.45) per
Unit (the Unit Issue Price) for gross proceeds of $808,446  (CDN$862,499.70)
and the sale of 543,615 flow-through units (the Flow-Through Units) at $0.49
(CDN$0.52) per Flow-Through Unit (the Flow-Through Unit Issue Price) for gross
proceeds of $264,979 (CDN$282,679.80), raising aggregate gross proceeds of
approximately $1,073,425 (CDN$1,145,180).  Each Unit consisted of one non-flow
through common share ("Common Share") and one half of one Common Share purchase
warrant (each whole warrant, a "Warrant").  Each Warrant is exercisable into one
Common Share until August 16, 2009 at an exercise price of $0.56 (CDN$0.60) per
share.  Each Flow-Through Unit consisted of one flow-through common share and
one half of one Common Share purchase warrant (each whole warrant, an "FT
Warrant").  Each FT Warrant is exercisable into one Common Share until August
16, 2009 at an exercise price of $0.66 (CDN$0.70) per share.  Yukon Gold paid
Northern a commission equal to 8% of the aggregate gross proceeds and issued
153,333 Unit Compensation Options and 43,489 FT Unit Compensation Options.
 Each Unit Compensation Option is exercisable into one Unit at the Unit Issue
Price until August 16, 2009.  Each FT Unit Compensation Option is exercisable
into one Common Share and one half of one FT Warrant at the Flow-Through Unit
Issue Price until August 16, 2009.  Yukon Gold has also granted Northern an
option (the "Over-Allotment Option") exercisable until October 15, 2007 to offer
for sale up to an additional $468,691 (CDN$500,000) of Units and/or Flow-Through
Units on the same terms and conditions.  The Company paid a $70,304 (CDN$75,000)
due diligence fee to Northern at closing and reimbursed Northern for its
expenses.  The proceeds of the Financing will be used for the exploration and
development of the Companys two Yukon Territory based properties, and for
working capital.



Item 3.

DEFAULTS UPON SENIOR SECURITIES



None.



Item 4.

SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.



ITEM 5: OTHER INFORMATION:



None.



ITEM 6: EXHIBITS & REPORTS ON FORM 8-K



|Exhibits |      |                                                                    
|-------- | ---- | -------------------------------------------------------------------
|         |      |                                                                    
|(a)      | 31.1 | Certification of Chief Executive Officer.                          
|         | 31.2 | Certification of Chief Financial Officer.                          
|         | 32.1 | Certificate of Chief Executive Officer and Chief Financial Officer.



---





SIGNATURE



Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.





Dated: September 12, 2007

By: /s/ Paul A. Gorman

Paul A. Gorman

Chief Executive Officer and Directors





---