Exhibit 99.1

FOR RELEASE, Friday, January 7, 2011		For Further Information Contact:
5:00 a.m. Pacific Standard Time		Katoiya Marshall, Investor Relations Contact
		(310) 893-7446 or kmarshall@kbhome.com
		Heather Reeves, Media Contact
		(310) 231-4142 or hreeves-x@kbhome.com

KB HOME REPORTS 2010 FOURTH QUARTER AND FULL YEAR FINANCIAL RESULTS
Fourth Quarter Net Income Totals $17.4 Million, or $.23 Per Diluted Share
Higher Margins and Lower S,G & A Expenses Drive Positive Quarterly Earnings
Cash Exceeds $1.0 Billion at Fiscal Year End

LOS ANGELES (January 7, 2011) — KB Home (NYSE: KBH), one of America’s premier homebuilders, today reported results for its fourth quarter and fiscal year ended November 30, 2010. Highlights and developments include the following:

•

Revenues totaled $451.0 million in the fourth quarter of 2010, down from $674.6 million in the fourth quarter of 2009 as a result of lower housing and land sale revenues. Fourth quarter housing revenues totaled $446.0 million in 2010, down 28% from the year-earlier period, reflecting a decline in the number of homes delivered, partly offset by an increase in the average selling price. Land sale revenues totaled $1.9 million in the 2010 fourth quarter, compared to $52.7 million in the corresponding quarter of 2009.

•

The Company’s homebuilding business generated operating income of $29.1 million for the quarter ended November 30, 2010, a $110.6 million improvement from an operating loss of $81.5 million for the year-earlier quarter, largely due to a higher housing gross margin and lower selling, general and administrative expenses, asset impairment and land option contract abandonment charges, and losses from land sales.

•

Fourth quarter 2010 net income totaled $17.4 million, or $.23 per diluted share, including an income tax benefit of $2.0 million. In the year-earlier quarter, reflecting an income tax benefit of $191.7 million associated with a change in tax legislation, the Company reported net income of $100.7 million, or $1.31 per diluted share. On a pretax basis, the Company generated income of $15.4 million in the fourth quarter of 2010, compared to a loss of $91.0 million reported in the year-earlier quarter. The current quarter results included $3.2 million of inventory impairment and land option contract abandonment

Headquarters 10990 Wilshire Boulevard. Los Angeles, California Tel: 310.231.4000 Fax: 310.231.4222 kbhome.com

charges, compared to $77.2 million of inventory and joint venture impairment and land option contract abandonment charges recorded in the fourth quarter of 2009.

•

The Company’s cash, cash equivalents and restricted cash at November 30, 2010 totaled $1.02 billion. The Company’s debt balance at November 30, 2010 was $1.78 billion, down $44.8 million from $1.82 billion at November 30, 2009.

•

The Company was recently named the #1 Green Builder for 2010 by Calvert Investments, a leading asset management firm in the area of sustainable and responsible investing, in an update to its 2008 review of the homebuilding industry. Once again, Calvert recognized KB Home as the leader among public homebuilders in sustainable residential construction policies and practices.

“We are very pleased to have ended the year with a solidly profitable fourth quarter,” said Jeffrey Mezger, president and chief executive officer. “This is the eleventh consecutive quarter we have achieved year-over-year improvement in our pretax results and the first time in nearly four years that we have generated pretax earnings. Given the challenging market and economic conditions we have faced, our consistent progress in improving both operational and financial metrics illustrates our success in accomplishing our strategic goals through our focused execution of our KBnxt Built to Order™ business model.”

Total revenues of $451.0 million for the quarter ended November 30, 2010 decreased 33% from the year-earlier quarter, due to lower housing and land sale revenues. Housing revenues declined from the year-earlier period as a result of a 37% decrease in the number of homes delivered, partly offset by a 14% increase in the average selling price. The Company delivered 1,918 homes at an average selling price of $232,500 in the 2010 fourth quarter, compared to 3,042 homes delivered at an average selling price of $203,400 in the year-earlier quarter. Fourth quarter land sale revenues totaled $1.9 million in 2010 and $52.7 million in 2009, reflecting a lower volume of activity in the current quarter.

Despite delivering fewer homes in the fourth quarter of 2010, the Company’s homebuilding business generated operating income of $29.1 million in the period, an improvement of $110.6 million from an operating loss of $81.5 million in the corresponding quarter of 2009. The favorable operating results in the current quarter mainly reflected a higher housing gross margin, reduced selling, general and administrative expenses, lower asset impairment and land option contract abandonment charges, and decreased losses from land sales. The Company’s fourth quarter housing gross margin rose to 19.1% in 2010, improving 12.3 percentage points from 6.8% in 2009. The housing gross margin included $2.9 million of inventory impairment and land option contract abandonment charges in the 2010 fourth quarter, compared to $76.0 million of such charges in the year-earlier quarter. Excluding these charges, the housing gross margin increased to 19.7% in the current quarter from 19.0% in the year-earlier quarter. Land sale losses totaled $.3 million in the fourth quarter of 2010, including $.3 million of impairment charges related to planned future land sales. This compared to land sale losses of $38.0 million in the fourth quarter of 2009, which included $.7 million of similar impairment charges.

Selling, general and administrative expenses decreased by $29.7 million, or 35%, to $55.7 million in the fourth quarter of 2010, compared to $85.4 million in the year-earlier period. The decrease was largely due to the

impact of cost reduction initiatives and, to a lesser extent, the lower number of homes delivered. As a percentage of housing revenues, the Company’s selling, general and administrative expenses decreased by 1.3 percentage points to 12.5% in the fourth quarter of 2010, compared to 13.8% in the year-earlier quarter, and improved from the ratios of 27.5%, 22.4% and 15.8%, in the first, second and third quarters of 2010, respectively.

The Company’s share of losses from unconsolidated homebuilding joint ventures totaled $1.6 million in the fourth quarter of 2010, compared to $1.8 million in the fourth quarter of 2009, which included $.5 million of impairment charges. There were no such charges in the fourth quarter of 2010.

Financial services operations, which include the Company’s equity interest in KBA Mortgage, LLC, an unconsolidated mortgage banking joint venture with a subsidiary of Bank of America, N.A., generated pretax income of $3.6 million in the 2010 fourth quarter and $7.5 million in the year-earlier quarter. The decrease was primarily due to lower income generated from the joint venture as the number of loans it originated declined.

The Company posted net income of $17.4 million, or $.23 per diluted share, in the fourth quarter of 2010, including inventory impairment and land option contract abandonment charges of $3.2 million, and an income tax benefit of $2.0 million. In the fourth quarter of 2009, the Company generated net income of $100.7 million, or $1.31 per diluted share, including charges of $77.2 million for inventory and joint venture impairments and land option contract abandonments, and an income tax benefit of $191.7 million.

“Although our outlook is cautious, we are encouraged by our achievements in 2010, and we intend to build on our operating efficiencies, our planned community growth and our product advantages to further enhance the financial performance of our business,” said Mezger. “Entering 2011, housing market conditions remain difficult due to soft demand and a general oversupply of homes available for sale. While there are indications that the overall economy has started to recover, the lack of improvement in employment and consumer confidence is likely to continue to hinder a sustained housing recovery. Nonetheless, we believe that with our demonstrated ability to improve our operational and financial results through the ongoing downturn and a strong balance sheet that enables us to opportunistically grow our community count and potential housing revenues, we are well positioned for the future.”

Net orders in the fourth quarter of 2010 were 1,085, down 25% from 1,446 in the year-earlier period. As a percentage of beginning backlog, the Company’s cancellation rate was 29% in the current quarter, compared to 17% in the 2009 fourth quarter. As a percentage of gross sales, the Company’s fourth quarter cancellation rate was 37% in 2010 and 31% in 2009. The Company’s backlog at November 30, 2010 totaled 1,336 homes, a 37% decrease from 2,126 homes in backlog at November 30, 2009. Potential future housing revenues in backlog at November 30, 2010 decreased 38% to $263.8 million from $422.5 million a year ago, primarily due to the lower number of homes in backlog.

The Company delivered 7,346 homes during the year ended November 30, 2010, down 13% from the year-earlier period, while the average selling price increased 4% year over year to $214,500. For fiscal 2010, Company-wide revenues totaled $1.59 billion, compared to $1.82 billion for the year-earlier period. The Company posted a net loss of $69.4 million, or $.90 per diluted share, for the year ended November 30, 2010, including charges of $19.9 million for inventory impairments and land option contract abandonments, and an income tax benefit of $7.0 million. For the year ended November 30, 2009, the Company generated a net loss of $101.8 million, or $1.33 per diluted share, including charges of $206.7 million for inventory and joint venture impairments and land option contract

abandonments. The net loss in fiscal 2009 also included an income tax benefit of $209.4 million.

The Conference Call on the Fourth Quarter 2010 earnings will be broadcast live TODAY at 8:30 a.m. Pacific Standard Time, 11:30 a.m. Eastern Standard Time. To listen, please go to the Investor Relations section of the Company’s website at www.kbhome.com.

KB Home, one of the nation’s premier homebuilders, has delivered over half a million quality homes for families since its founding in 1957. The Los Angeles-based company is distinguished by its Built to Order™ homebuilding approach that puts a custom home experience within reach of its customers at an affordable price. KB Home’s award-winning home designs and communities meet the needs of first-time, move-up and active adult homebuyers. KB Home was named to FORTUNE^® magazine’s 2010 list of the World’s Most Admired Companies for the sixth consecutive year, and ranked #1 for “Innovation” among homebuilders. The Company trades under the ticker symbol “KBH” and was the first homebuilder listed on the New York Stock Exchange. For more information about any of KB Home’s new home communities, call 888-KB-HOMES or visit www.kbhome.com.

Certain matters discussed in this press release, including any statements that are predictive in nature or concern future market and economic conditions, business and prospects, our future financial and operational performance, or our future actions and their expected results are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on current expectations and projections about future events and are not guarantees of future performance. We do not have a specific policy or intent of updating or revising forward-looking statements. Actual events and results may differ materially from those expressed or forecasted in forward-looking statements due to a number of factors. The most important risk factors that could cause our actual performance and future events and actions to differ materially from such forward-looking statements include, but are not limited to: general economic, employment and business conditions; adverse market conditions that could result in additional impairments or abandonment charges and operating losses, including an oversupply of unsold homes, declining home prices and increased foreclosure and short sale activity, among other things; conditions in the capital and credit markets (including consumer mortgage lending standards, the availability of consumer mortgage financing and mortgage foreclosure rates); material prices and availability; labor costs and availability; changes in interest rates; inflation; our debt level; weak or declining consumer confidence, either generally or specifically with respect to purchasing homes; competition for home sales from other sellers of new and existing homes, including sellers of homes obtained through foreclosures or short sales; weather conditions, significant natural disasters and other environmental factors; government actions, policies, programs and regulations directed at or affecting the housing market (including, but not limited to, tax credits, tax incentives and/or subsidies for home purchases, tax deductions for consumer mortgage interest payments and property taxes, tax exemptions for profits on home sales, and programs intended to modify existing mortgage loans and to prevent mortgage foreclosures), the homebuilding industry, or construction activities; the availability and cost of land in desirable areas; legal or regulatory proceedings or claims, including the claims described in footnote 9 to the consolidated financial statements in our Form 10-Q for the quarter ended August 31, 2010 and an involuntary bankruptcy filing made in December 2010 by certain lenders to the South Edge, LLC residential development joint venture located in Las Vegas and in which we are a participant; the ability and/or willingness of participants in our unconsolidated joint ventures to fulfill their obligations; our ability to access capital; our ability to use the net deferred tax assets we have generated; our ability to successfully implement our current and planned product, geographic and market positioning (including, but not limited to, our efforts to expand our inventory base/pipeline with desirable land positions or interests at reasonable cost and to expand our community count and open new communities), revenue growth and cost reduction strategies; consumer interest in our new product designs, including The Open Series^TM; and other events outside of our control. Please see our periodic reports and other filings with the Securities and Exchange Commission for a further discussion of these and other risks and uncertainties applicable to our business.

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(Tables Follow)
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KB HOME
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Twelve Months and Three Months Ended November 30, 2010 and 2009
(In Thousands, Except Per Share Amounts)

		Twelve Months								Three Months
		2010				2009				2010				2009
Total revenues		$	1,589,996			$	1,824,850			$	450,963			$	674,568
Homebuilding:
Revenues		$	1,581,763			$	1,816,415			$	447,917			$	671,401
Costs and expenses			(1,597,808	)			(2,052,935	)			(418,817	)			(752,945	)
Operating income (loss)			(16,045	)			(236,520	)			29,100				(81,544	)
Interest income			2,098				7,515				470				1,105
Interest expense, net of amounts capitalized/loss on early redemption			(68,307	)			(51,763	)			(16,199	)			(16,261	)
Equity in loss of unconsolidated joint ventures			(6,257	)			(49,615	)			(1,578	)			(1,804	)
Homebuilding pretax income (loss)			(88,511	)			(330,383	)			11,793				(98,504	)
Financial services:
Revenues			8,233				8,435				3,046				3,167
Expenses			(3,119	)			(3,251	)			(480	)			(682	)
Equity in income of unconsolidated joint venture			7,029				14,015				1,083				5,038
Financial services pretax income			12,143				19,199				3,649				7,523
Total pretax income (loss)			(76,368	)			(311,184	)			15,442				(90,981	)
Income tax benefit			7,000				209,400				2,000				191,700
Net income (loss)		$	(69,368	)		$	(101,784	)		$	17,442			$	100,719
Basic earnings (loss) per share		$	(.90	)		$	(1.33	)		$	.23			$	1.31
Diluted earnings (loss) per share		$	(.90	)		$	(1.33	)		$	.23			$	1.31
Basic average shares outstanding			76,889				76,660				76,957				76,670
Diluted average shares outstanding			76,889				76,660				76,983				76,876

KB HOME
CONSOLIDATED BALANCE SHEETS
(In Thousands)

		November 30,				November 30,
		2010				2009
Assets
Homebuilding:
Cash and cash equivalents		$	904,401			$	1,174,715
Restricted cash			115,477				114,292
Receivables			108,048				337,930
Inventories			1,696,721				1,501,394
Investments in unconsolidated joint ventures			105,583				119,668
Other assets			150,076				154,566
			3,080,306				3,402,565
Financial services			29,443				33,424
Total assets		$	3,109,749			$	3,435,989
Liabilities and stockholders’ equity
Homebuilding:
Accounts payable		$	233,217			$	340,977
Accrued expenses and other liabilities			466,505				560,368
Mortgages and notes payable			1,775,529				1,820,370
			2,475,251				2,721,715
Financial services			2,620				7,050
Stockholders’ equity			631,878				707,224
Total liabilities and stockholders’ equity		$	3,109,749			$	3,435,989

KB HOME
SUPPLEMENTAL INFORMATION
For the Twelve Months and Three Months Ended November 30, 2010 and 2009
(In Thousands)

		Twelve Months								Three Months
Homebuilding revenues:		2010				2009				2010				2009
Housing		$	1,575,487			$	1,758,157			$	446,010			$	618,685
Land			6,276				58,258				1,907				52,716
Total		$	1,581,763			$	1,816,415			$	447,917			$	671,401

		Twelve Months								Three Months
Costs and expenses:		2010				2009				2010				2009
Construction and land costs
Housing		$	1,301,677			$	1,643,757			$	360,837			$	576,875
Land			6,611				106,154				2,255				90,693
Subtotal			1,308,288				1,749,911				363,092				667,568
Selling, general and administrative expenses			289,520				303,024				55,725				85,377
Total		$	1,597,808			$	2,052,935			$	418,817			$	752,945

		Twelve Months								Three Months
Interest expense/loss on early redemption:		2010				2009				2010				2009
Interest incurred		$	120,428			$	118,626			$	30,323			$	31,434
Loss on early redemption of debt			—				976				—				—
Loss on voluntary termination of revolving credit facility			1,802				—				—				—
Interest capitalized			(53,923	)			(67,839	)			(14,124	)			(15,173	)
Total		$	68,307			$	51,763			$	16,199			$	16,261

		Twelve Months								Three Months
Other information:		2010				2009				2010				2009
Depreciation and amortization		$	5,438			$	6,821			$	1,205			$	1,467
Amortization of previously capitalized interest			105,150				138,179				25,696				59,347

KB HOME
SUPPLEMENTAL INFORMATION
For the Twelve Months and Three Months Ended November 30, 2010 and 2009

		Twelve Months								Three Months
Average sales price:		2010				2009				2010				2009
West Coast		$	346,300			$	315,100			$	372,700			$	321,400
Southwest			158,200				172,000				153,200				161,100
Central			163,700				155,500				166,800				151,600
Southeast			170,200				168,600				192,000				160,900
Total		$	214,500			$	207,100			$	232,500			$	203,400

		Twelve Months								Three Months
Homes delivered:		2010				2009				2010				2009
West Coast			2,023				2,453				583				864
Southwest			1,150				1,202				238				380
Central			2,663				2,771				729				1,016
Southeast			1,510				2,062				368				782
Total			7,346				8,488				1,918				3,042
Unconsolidated joint ventures			102				141				23				26

		Twelve Months								Three Months
Net orders:		2010				2009				2010				2009
West Coast			1,703				2,395				331				417
Southwest			1,007				1,136				157				200
Central			2,437				2,969				370				491
Southeast			1,409				1,841				227				338
Total			6,556				8,341				1,085				1,446
Unconsolidated joint ventures			66				111				4				21

Backlog data:		November 30, 2010								November 30, 2009
(Dollars in thousands)		Backlog Homes				Backlog Value				Backlog Homes				Backlog Value
West Coast			203			$	74,816				523			$	174,445
Southwest			139				21,306				282				46,135
Central			693				113,155				919				137,271
Southeast			301				54,517				402				64,645
Total			1,336			$	263,794				2,126			$	422,496
Unconsolidated joint ventures			1			$	511				37			$	15,577

KB HOME
RECONCILIATION OF NON-GAAP FINANCIAL MEASURE
For the Twelve Months and Three Months Ended November 30, 2010 and 2009
(In Thousands, Except Percentages)

This press release contains information about the Company’s housing gross margin, excluding inventory impairment and land option contract abandonment charges. This financial measure is not calculated in accordance with generally accepted accounting principles (GAAP). The Company believes this non-GAAP financial measure is relevant and useful to investors in understanding its operations and may be helpful in comparing the Company with other companies in the homebuilding industry to the extent they provide similar information. However, because the housing gross margin, excluding inventory impairment and land option contract abandonment charges, is not calculated in accordance with GAAP, this financial measure may not be completely comparable to other companies in the homebuilding industry and, thus, should not be considered in isolation or as an alternative to operating performance measures prescribed by GAAP. Rather, this non-GAAP financial measure should be used to supplement its most directly comparable GAAP financial measure in order to provide a greater understanding of the factors and trends affecting the Company’s operations.

Housing Gross Margin, Excluding Inventory Impairment and Land Option Contract Abandonment Charges

The following table reconciles the Company’s housing gross margin calculated in accordance with GAAP to the non-GAAP financial measure of the Company’s housing gross margin, excluding inventory impairment and land option contract abandonment charges:

		Twelve Months								Three Months
		2010				2009				2010				2009
Housing revenues		$	1,575,487			$	1,758,157			$	446,010			$	618,685
Housing construction and land costs			(1,301,677	)			(1,643,757	)			(360,837	)			(576,875	)
Housing gross margin			273,810				114,400				85,173				41,810
Add: Inventory impairment and land option contract abandonment charges			19,577				157,641				2,838				75,967
Housing gross margin, excluding inventory impairment and land option contract abandonment charges		$	293,387			$	272,041			$	88,011			$	117,777
Housing gross margin as a percentage of housing revenues			17.4	%			6.5	%			19.1	%			6.8	%
Housing gross margin, excluding inventory impairment and land option contract abandonment charges, as a percentage of housing revenues			18.6	%			15.5	%			19.7	%			19.0	%

Housing gross margin, excluding inventory impairment and land option contract abandonment charges, is a non-GAAP financial measure, which the Company calculates by dividing housing revenues less housing construction and land costs before pretax, noncash inventory impairment and land option contract abandonment charges associated with housing operations recorded during a given period, by housing revenues. The most directly comparable GAAP financial measure is housing gross margin. The Company believes housing gross margin, excluding inventory impairment and land option contract abandonment charges, is a relevant and useful financial measure to investors in evaluating the Company’s performance as it measures the gross profit the Company generated specifically on the homes delivered during a given period and enhances the comparability of housing gross margins between periods. This financial measure assists management in making strategic decisions regarding product mix, product pricing and construction pace. The Company also believes investors will find housing gross margin, excluding inventory impairment and land option contract abandonment charges, relevant and useful because it represents a profitability measure that may be compared to a prior period without regard to variability of charges for inventory impairments or land option contract abandonments.