We investigate the quantum Hall effect in graphene. We argue that in graphene in presence of an external magnetic field there is dynamical generation of mass by a rearrangement of the Dirac sea. We show that the mechanism breaks the lattice valley degeneracy only for the n = 0 Landau levels and leads to the new observed ν = ±1 quantum Hall plateaus. We suggest that our result can be tested by means of numerical simulations of planar Quantum Electro Dynamics with dynamical fermions in an external magnetic fields on the lattice.