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Exhibit 4.1  2007 Stock Option Plan

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YUKON-NEVADA GOLD CORP.

INCENTIVE STOCK OPTION PLAN

**1.**                     
**Purpose**

1.1.                      
The purpose of the Incentive Stock Option Plan (the "Plan") is to promote
the profitability and growth of YUKON-NEVADA GOLD CORP. (the
"Company") by facilitating the efforts of the Company and its
subsidiaries to obtain and retain key individuals. The Plan provides an
incentive for and encourages ownership of the Company's common shares
(Shares) by its key individuals so that they may increase their stake
in the Company and be incentized by increases in the value of the Company's
Shares.

**2.**          
**Administration**

2.1.                      
The Plan will be administered by the Company's Board of Directors (the
"Board") or a committee of the Board (Committee). In the event
the Plan is administered by a Committee, the Committee shall comprise not fewer
than three persons, each of whom must be independent within the meaning of
Multilateral Instrument 52-110, Audit Committees,adopted by the Canadian
Securities Administrators. Except as to the composition of the Committee, where
used herein, the term Committee will also include the Board.

2.2.                      
The Committee will be authorized, subject to the provisions of the Plan, to
adopt such rules and regulations which it deems consistent with the Plan's
provisions and, in its sole discretion, to grant options ("Options") to
purchase Shares of the Company pursuant to the Plan. The Committee may authorize
one or more directors, officers or employees of the Company or an individual
(including an individual whose services are contracted through a personal
holding corporation) with whom the Company or a subsidiary has a contract for
substantial services (a Consultant) to execute, deliver and receive
documents on behalf of the Committee.

**3.**           **Eligibility**

**3.1.**                     
All directors, officers, Consultants and employees of the Company and its
subsidiaries will be eligible to receive Options.

3.2.                      
Nothing in the Plan or in any Option shall confer any right on any individual to
continue in the employ of or in any capacity with the Company or its
subsidiaries or will interfere in any way with the right of the Company or
subsidiaries to terminate at any time the employment or other capacity of a
person who is an optionee ("Optionee") under an Option.

**4.**          
**Shares Subject to Option**

4.1.                      
The Shares to be optioned under the Plan will be authorized but unissued common
shares without par value of the Company.

4.2.                      
Subject to adjustment as provided for herein, the number of Shares available for
purchase pursuant to Options granted pursuant to this Plan will not exceed 10%
of the number of Shares which are issued and outstanding on the particular date
of grant of Options including: (a) the existing Shares currently subject to
outstanding Options as of the date of this Plan which were granted prior to the
implementation of this Plan and which, by the implementation of this Plan, are
covered under this Plan; and (b) the additional stock options which may be
granted and exchanged with holders of stock options of Queenstake Resources Ltd.
(Queenstake) as a result of the Companys business combination by plan of
arrangement with Queenstake.

4.3.                      
Any Shares subject to an Option which for any reason is cancelled or terminated
without having been exercised, shall again be available for grant under the
Plan. No fractional shares shall be issued. Reference should be made to section
23.4 for the manner in which fractional share values will be treated.

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4.4.                      
The Board may, at any time, without further approval by the shareholders of the
Company, amend the Plan or any Option granted hereunder in such respects as it
may consider advisable and, without limiting the generality of the foregoing, it
may do so to:

|(a) | amend typographical, clerical and grammatical
    errors;                                                                                                                                                                                                                                            
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|    |                                                                                                                                                                                                                                                                                                      
|(b) | reflect changes to applicable securities laws;                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                      
|(c) | change the termination provisions of Options or the Plan
      which do not entail an extension beyond the original expiry
date;                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                      
|(d) | include the addition of a cashless exercise feature,
      payable in cash or securities;                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                      
|(e) | ensure that the Options granted under the Plan will
      comply with any provisions respecting the income tax and other laws in
      force in any country or jurisdiction of which a Participant to whom an
      Option has been granted may from time to time be resident or a citizen;
      and
|    |                                                                                                                                                                                                                                                                                                      
|(f) | reduce the exercise price of an Option for an Optionee
      who is not an insider of the Company.                                                                                                                                                                                                   

4.5.                      
The number of Shares issuable to insiders of the Company, at any time, under all
security-based compensation arrangements, cannot exceed 10% of the total issued
and outstanding (as to a maximum of 5% with respect to any one individual)
Shares; and

4.6.                      
The number of Shares issued to insiders, within any one year period, under all
security-based compensation arrangements, cannot exceed 10% of the Companys
issued and outstanding Shares. This provision applies to all types of
security-based compensation.

**5.**          
**Granting of Options**

5.1.                      
The Committee may from time to time at its discretion, subject to the provisions
of the Plan, determine those eligible individuals to whom Options will be
granted, the number of Shares subject to such Options, the dates on which such
Options are to be granted and the expiration of such Options.

5.2.                      
The Committee may, at its discretion, with respect to any Option, impose
additional terms and conditions, including conditions for the vesting of
Options, which are more restrictive on the Optionee than those provided for in
the Plan.

5.3.                      
Each Option will be evidenced by a written agreement between, and executed by,
the Company and the individual containing terms and conditions established by
the Committee with respect to such Option and will be consistent with the
provisions of the Plan.

**6.**          
**Option Price**

6.1.                      
The price per Share at which Shares may be purchased upon the exercise of an
Option (the "Option Price") will not be lower than the last recorded sale
of a board lot of Shares on the Toronto Stock Exchange (the TSX) during
the trading day immediately preceding the date of granting of the Option or, if
there was no such sale, the weighted average trading price on the TSX of the
Shares for the five trading days immediately preceding the date on which the
Option is granted.

**7.**          
**Term of Option**

7.1.                      
The maximum term of any Option will be 10 years.

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7.2.                      
The Option Price must be paid in full at the time of exercise of the Option and
no Shares will be delivered until full payment is made.

7.3.                      
An Optionee will not be deemed the holder of any Shares subject to his Option
until the Shares are delivered to him.

**8.**          
**Transferability of Options**

8.1.                      
An Option may not be assigned. During the lifetime of an Optionee, the Option
may be exercised only by the Optionee.

**9.**          
**Termination of Employment**

9.1.                      
Upon termination of employment or other capacity with the Company for any reason
except death or retirement, or failure of re-election as a director, or failure
to be re-appointed an officer of the Company, an Optionee may, at any time
within 90 days after the date of termination but not later than the date of
expiration of the Option, exercise the Option to the extent the Optionee was
entitled to do so on the date of termination. Any Option or portions of Options
of terminated individuals not so exercised will terminate and will again be
available for future Options under the Plan. A change of employment or capacity
with the Company will not be considered a termination so long as the Optionee
continues to be employed or engaged by the Company or its subsidiaries in a
capacity eligible to receive Options under this Plan.

**10.**         
**Death**

10.1.                    
Notwithstanding any other provision of the Plan, if any Optionee dies holding an
Option which has not been fully exercised, his personal representative, heirs or
legatees may, at any time within 60 days of grant of probate of the will, or
letters of administration of the estate of the decedent, or within one year
after the date of such death, whichever is the lesser time (notwithstanding the
normal expiry date of the Option) exercise the Option with respect to the
unexercised balance of the Shares subject to the Option.

**11.**         
**Retirement**

11.1.                    
Notwithstanding any other provision of the Plan, if any Optionee shall retire,
or terminate his employment or other capacity with the Company with the consent
of the Board under circumstances equating retirement, while holding an Option
which has not been fully exercised, such Optionee may exercise the Option at any
time during the unexpired term of the Option.

**12.**         
**Changes in Shares**

12.1.                    
In the event the authorized share capital of the Company as presently
constituted is consolidated into a lesser number of Shares or is subdivided into
a greater number of Shares, the number of Shares for which Options are
outstanding will be decreased or increased proportionately as the case may be,
and the Option Price per Share will be adjusted accordingly and the Optionees
will have the benefit of any stock dividend declared during the period within
which the said Optionee held his Option. Should the Company amalgamate or merge
with any other company or companies (the right to do so being hereby expressly
reserved) whether by way of arrangement, sale of assets and undertakings or
otherwise, then and in each such case the number of shares of the resulting
corporation to which an Option relates will be determined as if the Option had
been fully exercised prior to the effective date of the amalgamation or merger
and the Option Price per Share will be correspondingly increased or decreased,
as applicable.

**13.**         
**Effect of a Take-Over Bid**

13.1.                    
If a bona fideoffer(an "Offer") for Shares is made to the
Optionee or to shareholders of the Company generally or to a class of
shareholders which includes the Optionee, which Offer,if accepted in
whole

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or in part, would result in the offeror becoming a control
person of the Company, within the meaning given to "control person" in the
Securities Act (British Columbia), the Company will, immediately upon
receipt of notice of the Offer, notify each Optionee of full particulars of the
Offer, whereupon all Shares subject to such Option will become vested and the
Option may be exercised in whole or in part by the Optionee so as to permit the
Optionee to tender the Shares received upon such exercise, pursuant to the
Offer. However, if:

|(a) | the Offer is not completed within the time specified
      therein; or                                                                      
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|    |                                                                                                                                             
|(b) | all of the Shares tendered by the Optionee pursuant to
      the Offer are not taken up or paid for by the offeror in respect
      thereof,

then the Shares received upon such exercise, or in the case of
Section 13.1(b) hereof, the Shares that are not taken up and paid for, may be
returned by the Optionee to the Company and reinstated as authorized but
unissued Shares and with respect to such returned Shares, the Option will be
reinstated as if it had not been exercised and the terms upon which such Shares
were to become vested pursuant to this Section will be reinstated. If any Shares
are returned to the Company under this Section 13, the Company will immediately
refund the exercise price to the Optionee for such Shares.

**14.**         
**Acceleration of Expiry Date**

14.1.                    
If an Offer is made by an offeror at any time when an Option granted under the
Plan remains unexercised, in whole or in part, the Directors may, upon notifying
each Optionee of full particulars of the Offer, declare all Shares issuable upon
the exercise of Options granted under the Plan to be vested and declare that the
Expiry Date for the exercise of all unexercised Options granted under the Plan
be accelerated so that all Options will either be exercised or will expire prior
to the date upon which Shares must be tendered pursuant to the Offer.

**15.**         
**Effect of a Change of Control**

15.1.                    
If a Change of Control, as hereinafter defined, occurs, all Shares subject to
each outstanding Option will become vested, whereupon such Option may be
exercised in whole or in part by the Optionee.

15.2.                    
Change of Controlmeans the acquisition by any person, or by any person
and a Joint Actor, whether directly or indirectly, of voting securities as
defined in the Securities Act(British Columbia) of the Company, which,
when added to all other voting securities of the Company at the time held by
such person or by such person and a Joint Actor, totals for the first time not
less than 30% of the outstanding voting securities of the Company or the votes
attached to those securities are sufficient, if exercised, to elect a majority
of the Board of Directors of the Company. "Joint Actor" means a person
acting "jointly or in concert with" another person as that phrase is interpreted
in the Securities Act (British Columbia).

**16.**         
**Exchange Policy Applies**

16.1.                    
The Plan and the granting and exercise of any Options hereunder are also subject
to such other terms and conditions as are set out from time to time in the
Policies of the TSX and any securities commission having authority, and the
Policies of the TSX will be deemed to be incorporated into and become a part of
the Plan. In the event of an inconsistency between the provisions of the
Policies of the TSX and of the Plan, the provisions of the Policies of the TSX
will govern.

**17.**         
**Cancellation and Re-granting of Options**

17.1.                    
The Committee may, with the consent of the Optionee, cancel an existing Option,
and re-grant the Option at an Option Price determined in the same manner as
provided in Section 6 hereof, subject to the prior approval of the TSX.

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**18.**         
**Amendment or Discontinuance**

18.1.                    
The Board may alter, suspend or discontinue the Plan, but may not, without the
approval of the shareholders of the Company, make any alteration which would (a)
increase the aggregate number of Shares subject to Option under the Plan except
as provided in Section 12 or (b) decrease the Option Price except as provided in
Section 17. Notwithstanding the foregoing, the terms of an existing Option may
not be altered, suspended or discontinued without the consent in writing of the
Optionee.

**19.**         
**Extension of Expiry Date of Stock Options Expiring During a Blackout
Period**

19.1.                    
The expiry date of outstanding Options held by Optionees which may expire during
a restricted trading period, imposed by the Company in accordance with
applicable securities laws (a "Blackout Period"), will be extended for a period
of 10 business days commencing on the first business day after the expiry date
of the Blackout Period to provide such Optionees with an extension to the right
to exercise such Options.

**20.**         
**Interpretation**

20.1.                    
The Plan will be construed according to the laws of the Province of British
Columbia.

**21.**         
**Liability**

21.1                   
.. No member of the Committee or any director, officer, Consultant or employee of
the Company will be personally liable for any act taken or omitted in good faith
in connection with the Plan.

**22.**          **Representation by Participants**

22.1.                    
Each option agreement shall provide that upon each exercise of an Option, the
Optionee (including for the purposes of this section 22 each other person who,
pursuant to sections 9, 10 and 11 hereof, may purchase Shares under an Option
granted to a director, officer, Consultant or employee of the Company) shall, if
so requested by the Company, represent and agree in writing that:

|(a) | the person is, or the Optionee was, a director, officer,
      Consultant or employee of the Company or a director, officer, Consultant
      or employee of an associated, affiliated, controlled or subsidiary company
      and has not been induced to purchase the Shares by expectation of
      employment or continued employment;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
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|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|(b) | the person is purchasing the Shares pursuant to the
      exercise of such Option as principal for the Optionees own account (or if
      such Optionee is deceased, for the account of the estate of such deceased
      Optionee);                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|(c) | the person will, prior to and upon any sale or
      disposition of any of the Shares purchased pursuant to the exercise of
      such Option, comply with all applicable securities laws and any other
      federal, provincial or state laws or regulations to the extent that such
      laws or regulations are applicable to such sale or disposition;
  and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|(d) | such Optionee (or such other person) will not offer, sell
      or deliver any of the Shares purchased pursuant to the exercise of such
      Option, directly or indirectly, in the United States or to any citizen or
      resident of, or any corporation, partnership or other entity created or
      organized in or under the laws of, the United States, or any estate or
      trust the income of which is subject to United States federal income
      taxation regardless of its source, except in compliance with United States
      federal and state securities laws. The Optionee acknowledges that the
      Company has the right to place any restriction or legend on any securities
      issued pursuant to this Plan including, but in no way limited to placing a
      legend to the effect that the securities have not been registered under
      the United States Securities Actof 1933 and may not be offered or
      sold in the United States unless registration or an exemption from
      registration is available.

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|(e) | The Company may employ other procedures and require
      further documentation from an Optionee to ensure compliance with all
      applicable laws.                                                                                                                                                                                                                                                                                                         
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|(f) | The issue and sale of Shares pursuant to any Option
      granted under the Plan is conditioned on such issue and sale being made in
      compliance with applicable securities laws, and the Company shall have no
      obligation to issue or sell any Shares pursuant to the exercise of any
      Option unless the Board determines in its sole discretion that such issue
      and sale will be made in compliance with applicable securities
  laws.

**23.**         
**Effective Date**

23.1.                    
This Plan will supersede and replace all previous stock option plans on May 18,
2007. This Plan is subject to the approval of:

|(a) | TSX; and                                                                                                                                                                                                                                                                                                                    
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|    |                                                                                                                                                                                                                                                                                                                             
|(b) | the shareholders of the Company, given by the affirmative
      vote of a majority of the votes attached to the Shares of the Company
      entitled to vote and represented and voted at an annual or special meeting
      of the holders of such Shares held, among other things, to consider and
      approve the Plan,
|    |                                                                                                                                                                                                                                                                                                                             
|(c) | and until such approvals are obtained Options granted
      pursuant to the Plan shall not be exercisable.                                                                                                                                                                                                                  

**24.**         
**Miscellaneous**

24.1.                    
Nothing contained herein shall prevent the Board from adopting other or
additional compensation arrangements, subject to any required regulatory or
shareholder approval.

24.2.                    
Nothing contained in the Plan nor in any Option granted thereunder shall be
deemed to give any Optionee any interest or title in or to any Shares or any
rights as a shareholder of the Company or any other legal or equitable right
against the Company whatsoever other than as set forth in the Plan and pursuant
to the exercise of any Option.

24.3.                    
The Plan does not give any director, officer, Consultant or employee of the
Company the right or obligation to become or to continue to serve as a director,
officer, Consultant or employee of the Company, as the case may be, of the
Company or any of its subsidiaries. The awarding of Options to any director,
officer, Consultant or employee of the Company is a matter to be determined
solely in the discretion of the Board. The Plan shall not in any way fetter,
limit, obligate, restrict or constrain the Board with regard to the allotment or
issue of any Shares or any other securities in the capital of the Company or any
of its subsidiaries other than as specifically provided for in the Plan.

24.4.                    
No fractional Shares shall be issued upon the exercise of Options and,
accordingly, if a Optionee would become entitled to a fractional Share upon the
exercise of an Option, such Optionee shall only have the right to purchase the
next lowest whole number of Shares and no payment or other adjustment will be
made with respect to the fractional interest so disregarded.

24.5.                    
The grant of an Option shall be conditional upon the director, officer,
Consultant or employee of the Company to whom the Option is granted completing,
signing and delivering to the Company all documents as may be required by the
regulatory authorities having jurisdiction.

**25.**          **Shareholder Approval**

25.1.                    
The Plan, as approved by the shareholders of the Company, will terminate unless
it is approved by the shareholders of the Company at the annual general meeting
held every three years following the initial approval.

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