Fitch Credit Rating of Telefónica

TELEFÓNICA, S.A. as provided in article 82 of the Spanish Securities Act (Ley del Mercado de Valores), hereby reports the following

SIGNIFICANT EVENT

Yesterday, the credit rating agency Fitch Ratings published its decision to lower the long-term credit rating of Telefónica, S.A. from A- outlook negative to BBB+ outlook stable. At the same time, the rating agency's short-term credit rating remained at F-2.

Madrid, September 28th, 2011.