ALTERITY THERAPEUTICS LIMITED [ACN 080 699 065] ("the Company") OPTIONS PROSPECTUS This Prospectus contains an offer of 285,087,720 options ( Options ) each with an exercise price of A$0.01 (1 Australian cent), expiry da

ALTERITY THERAPEUTICS LIMITED

This Prospectus contains an offer

of 285,087,720 options (Options) each with an exercise price of A$0.01 (1 Australian cent), expiry date of 31 August 2026 and which,

upon exercise, entitle the holder to one fully paid ordinary share in the capital of the Company.

The offer of Options under this Prospectus

is referred to as the Offer.

is only made to and capable of acceptance by investors identified by the Company who are invited to participate in the Offer, noting the

Options are being issued as free-attaching to fully paid ordinary shares under the Placement as described in Section 1.1.

The Offer closes at noon (Melbourne

time) on Tuesday 16 April 2024, which date or time may change without notice.

THIS DOCUMENT IS IMPORTANT AND

SHOULD BE READ IN ITS ENTIRETY

It is important that you read this

Prospectus carefully before deciding whether to accept the Offer. If you do not understand its contents you should consult your stockbroker,

accountant or other professional adviser.

The securities offered under

this Prospectus are considered highly speculative

ALTERITY THERAPEUTICS LIMITED

Geoffrey Kempler - Non-Executive

Lawrence Gozlan - Non-Executive Director

Peter Marks - Non-Executive Director

Brian Meltzer - Non-Executive Director

Chief Executive Officer

Company Secretary and Chief

Level 3, 62 Lygon Street

Carlton Victoria 3053

Tel: +61 3 9824 5254

Computershare Investor Services

Yarra Falls, 452 Johnston Street

Abbotsford Victoria 3067

reports, shareholder and company information, news announcements, background information on the Company's business and historical

information, visit https://alteritytherapeutics.com/.

This prospectus (Prospectus)

is dated 12 April 2024. A copy of this Prospectus was lodged with the Australian Securities & Investments Commission (ASIC)

on the same date. Neither ASIC nor ASX Limited (ASX) nor their respective officers take any responsibility as to the contents of

Subject to the Corporations Act,

the ASX Listing Rules and other applicable laws, the Company reserves the right to close the Offer early, to extend the Closing Date and/or

any other dates (including where applicable by making an announcement of the extension to ASX), or not to proceed with the Offer described

The Offer is being made under

this Prospectus closes at noon (Melbourne time) on Tuesday 16 April 2024, which date or time may change without notice.

is for an offer of options to acquire continuously quoted securities (the Options) and accordingly is not required by the Corporations

Act to contain all the information normally required to be set out in a document of this type. This Prospectus contains and applies to

the offer of Options.

This Prospectus incorporates by

reference certain information contained in documents lodged with ASIC. A document incorporated by reference in this Prospectus in this

manner may be obtained free of charge from the Company during the application period.

The Company has adopted a target

market determination (TMD) for the Offer. The TMD is available at the website of the Company, www.alteritytherapeutics.com. By

making an application under the Offer, an investor warrants that they have read and understood the TMD and that they meet the eligibility

criteria of, and fall within the target markets set out in, the TMD.

No person is authorised to give

any information or make any representation in connection with this Prospectus that is not contained in this Prospectus. Any information

or representation not so contained may not be relied on as having been authorised by the Company in connection with the offer of securities.

This Prospectus does not constitute

an offer in any place in which, or to any person to whom, it would not be lawful to make such an offer. The distribution of this Prospectus

in jurisdictions outside Australia may be restricted by law and persons who come into possession of this Prospectus should observe any

of those restrictions. Any failure to comply with the restrictions may constitute a violation of applicable securities law.

No action has been taken to register

or qualify the offer of securities made under this Prospectus, or the securities themselves, or otherwise to permit a public offering

of the securities offered under this Prospectus, in any jurisdiction outside Australia. The securities offered under this Prospectus have

not been, and will not be, registered under the United States Securities Act of 1933 and should not be offered or sold within the USA.

No account has been taken of

particular objectives, financial situation or needs of recipients of this Prospectus. Recipients of this Prospectus should have regard

to their own objectives, financial situation and needs. Recipients of this Prospectus should make their own independent investigation

and assessment of the Company, its business, assets and liabilities, prospects and profits and losses, and risks associated with investing.

Independent expert advice should be sought before any decision is made to apply for securities under this Prospectus.

All monetary amounts in this Prospectus

are in Australian dollars unless otherwise stated.

All dates and times are dates

and times in Melbourne, Victoria, Australia unless otherwise stated.

The securities offered under this Prospectus are considered highly

The above dates and times should

be regarded as indicative only and may change without notice. All dates and times are Melbourne, Victoria, Australia time. Subject

to the Corporations Act 2001 (Cth), the ASX Listing Rules and other applicable laws, the Company reserves the right to change the above

dates or times, close the Offer before the date or time stated above, accept late applications under the Offer, extend the Closing Date

or not proceed with the Offer. The Company reserves the right to extend the Closing Date or time by making an announcement of the extension

to ASX. No securities will be issued on the basis of this Prospectus after 12 May 2025, being the expiry date of this Prospectus.

KEY INVESTMENT RISKS -

Please read and consider this

Prospectus in full and in conjunction with matters which have or may be referred to in the Company's ASX announcements before applying

for Options under the Offer.

Section 5 of this Prospectus

contains an overview of some of the key risks associated with investment in the Company, including risks associated with the Offer as

The Company provided detailed disclosure

of business risk factors in its item 3.D of its 2023 Annual Report for the reporting period ended 30 June 2023 that was released to ASX

on 31 August 2023. The 2023 Annual Report has been lodged with ASIC and item 3.D of the 2023 Annual Report is incorporated by reference

into this Prospectus in accordance with Section 712 of the Corporations Act. A copy of the 2023 Annual Report including item 3.D is available

at www2.asx.com.au (search code "ATH") and can be obtained from the Company upon request.

A selection of risk factors as described

in item 3.D of the 2023 Annual Report are set out below:

Further details of the above risk

factors, as well as information regarding additional business risk factors that may impact upon the Company, are set out in item 3.D of

the 2023 Annual Report as described above.

ABOUT THE OFFER - SUMMARY

The following summary provides

only a limited overview of the Offer made under this Prospectus. Further details are set out in this Prospectus. Please read and consider

this Prospectus in full before making any decision regarding seeking to accept the Offer or otherwise investing in the Company.