Mobile TeleSystems Announces Financial Results for the First Quarter Ended March 31, 2011

MOSCOW, May 26, 2011 -

Mobile TeleSystems OJSC ("MTS" - NYSE: MBT), the leading
telecommunications provider in Russia and the CIS, today announces its
unaudited US GAAP financial results for the three months ended March 31,
2011.

Key Financial Highlights of Q1 2011

- Consolidated revenues down 2.0% q-o-q to $2,934 million

- Consolidated OIBDA[1] down 2.9% q-o-q to $1,126 million with
38.4% OIBDA margin

- Consolidated net income[2] of $322 million

- Free cash-flow[3] positive with $621 million for the first
three months of 2011

Key Corporate and Industry Highlights

- Appointment of Andrei Dubovskov, former Head of Business
Unit MTS Ukraine, as President and CEO of MTS

- Completion of share buyback in March 2011 related to the
statutory merger of Comstar with MTS

- Conversion of Comstar ordinary shares into MTS ordinary
shares on April 1, 2011 and subsequent completion of the statutory merger of
Comstar with MTS

- Continued acquisitions of regional fixed operators with a
purchases of alternative operators in Kurgan and Altai Krai for RUB 435.0
million and RUB 545.8 million respectively

- Annual dividend recommendation by the MTS Board of Directors
of RUB 14.54[4] per ordinary MTS share (approximately $1.04 per ADR[5]) for
the 2010 fiscal year, amounting to a total of RUB 30.05 billion
(approximately $1.08 billion or 78% of US GAAP net income)

- Receipt of GSM 900 MHz license in Penza region giving MTS
full 2G coverage in Russia

- MTS' brand has been named as one of the BRANDZ(TM) Top 100
Most Powerful Brands with the 80th position and a brand value of $10.9
billion

Commentary

Andrei Dubovskov, President and CEO of MTS, commented, "Group revenue for
the quarter increased 12% year-over-year to reach $2.93 billion on the back
of strong subscriber additions and growth in data traffic and handset
revenues. Revenues in Russia - including mobile, fixed and handset and
equipment sales - increased 14% year-over-year to RUB 74.3 billion."

Alexey Kornya, MTS Vice President and Chief Financial Officer, said, "In
the first quarter, Group OIBDA declined by 3% year-over-year to $1.1 billion
with the OIBDA margin for the period reaching 38.4%. Our Russia OIBDA margin
increased sequentially from 37.7% to 39.1% in Q1 2011. The improvement is
mainly attributable to the growing share of higher-margin data traffic
revenues on the back of our modem sales push and expanding 3G networks."

Mr. Dubovskov added, "With the completion of the Comstar merger, we can
now focus on the broader optimization of our business. Operationally, we can
concentrate on rationalizing headcount to eliminate redundancies. We can also
begin to examine asset disposals like real estate in our fixed line business
in order to lower costs. For the customer, we can move ahead with critical
steps in integrating our business, including convergent billing, so as to
further improve our customer experience, increase loyalty and drive future
growth."

This press release provides a summary of some of the key financial and
operating indicators for the period ended March 31, 2011. For full disclosure
materials, please visit www.mtsgsm.com/resources/reports/ .

Learn more about MTS. Visit the official blog of the Investor Relations
Department at www.mtsgsm.com/blog/

Mobile TeleSystems OJSC ("MTS") is the leading telecommunications group
in Russia, Eastern Europe and Central Asia, offering mobile and fixed voice,
broadband, pay TV as well as content and entertainment services in one of the
world's fastest growing regions. Including its subsidiaries, the Group
services over 108.9 million mobile subscribers in Russia, Ukraine,
Uzbekistan, Turkmenistan, Armenia and Belarus, a region that boasts a total
population of more than 230 million. Since June 2000, MTS' Level 3 ADRs have
been listed on the New York Stock Exchange (ticker symbol MBT). Additional
information about the MTS Group can be found at www.mtsgsm.com.

Some of the information in this press release may contain
projections or other forward-looking statements regarding future events or
the future financial performance of MTS, as defined in the safe harbor
provisions of the U.S. Private Securities Litigation Reform Act of 1995. You
can identify forward looking statements by terms such as "expect," "believe,"
"anticipate," "estimate," "intend," "will," "could," "may" or "might," and
the negative of such terms or other similar expressions. We wish to caution
you that these statements are only predictions and that actual events or
results may differ materially. We do not undertake or intend to update these
statements to reflect events and circumstances occurring after the date
hereof or to reflect the occurrence of unanticipated events. We refer you to
the documents MTS files from time to time with the U.S. Securities and
Exchange Commission, specifically the Company's most recent Form 20-F. These
documents contain and identify important factors, including those contained
in the section captioned "Risk Factors" that could cause the actual results
to differ materially from those contained in our projections or
forward-looking statements, including, among others, the severity and
duration of current economic and financial conditions, including volatility
in interest and exchange rates, commodity and equity prices and the value of
financial assets; the impact of Russian, U.S. and other foreign government
programs to restore liquidity and stimulate national and global economies,
our ability to maintain our current credit rating and the impact on our
funding costs and competitive position if we do not do so, strategic actions,
including acquisitions and dispositions and our success in integrating
acquired businesses, including Comstar-UTS, potential fluctuations in
quarterly results, our competitive environment, dependence on new service
development and tariff structures, rapid technological and market change,
acquisition strategy, risks associated with telecommunications
infrastructure, governmental regulation of the telecommunications industries
and other risks associated with operating in Russia and the CIS, volatility
of stock price, financial risk management and future growth subject to risks.

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[1] See Attachment A for definitions and reconciliation of OIBDA and
OIBDA margin to their most directly comparable US GAAP financial measures.

[2] Attributable to the Group.

[3] See Attachment B for reconciliation of free cash-flow to net cash
provided by operating activity.

[4] The dividend yield per share is 5.7% based on the closing price of
the MTS ordinary share on the Moscow Interbank Currency. Exchange as of April
26, 2011.

[5] According to the Russian Central Bank exchange rate of 27.8964
RUB/USD as of April 27, 2011. The dividend amount is set in Russian rubles by
the Board of Directors; U.S. dollar amounts provided for reference using the
foreign exchange rate as of April 27, 2011.

For further information, please contact in Moscow: Joshua B. Tulgan, Director, Investor Relations, Acting Director, Corporate Finance, Department of Investor Relations, Mobile TeleSystems OJSC, Tel: +7-495-223-2025, E-mail: ir at mts.ru