Prudential Investment Portfolios 2 N-CSRS Certified semi-annual shareholder report (management investment company)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number:	811-09999
Exact name of registrant as specified in charter:	Prudential Investment Portfolios 2
Address of principal executive offices:	Gateway Center 3,
	100 Mulberry Street,
	Newark, New Jersey 07102
Name and address of agent for service:	Deborah A. Docs
	Gateway Center 3,
	100 Mulberry Street,
	Newark, New Jersey 07102
Registrant’s telephone number, including area code:	973-367-7521
Date of fiscal year end:	1/31/2013
Date of reporting period:	7/31/2012

Item 1 – Reports to Stockholders

Fees and Expenses (Unaudited)

As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemptions, as applicable, and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The example is based on an investment of $1,000 invested on February 1, 2012, at the beginning of the period and held through the six-month period ended July 31, 2012.

Actual Expenses

The first line for each Fund in the following table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading “Expenses Paid During the Six-Month Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The second line for each Fund in the following table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Prudential Investment Portfolios 2 1

Fees and Expenses (continued)

Please note that the expenses shown in the table are meant to highlight your ongoing costs only, and do not reflect any transactional costs such as sales charges (loads). Therefore the second line for each Fund in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

Prudential Core Taxable Money Market Fund	Beginning Account Value February 1, 2012		Ending Account Value July 31, 2012		Annualized Expense Ratio Based on the Six-Month Period			Expenses Paid During the Six-Month Period*
Actual	$	1,000.00	$	1,001.10		0.01	%	$	0.05
Hypothetical	$	1,000.00	$	1,024.81		0.01	%	$	0.05

Prudential Core Short-Term Bond Fund	Beginning Account Value February 1, 2012		Ending Account Value July 31, 2012		Annualized Expense Ratio Based on the Six-Month Period			Expenses Paid During the Six-Month Period*
Actual	$	1,000.00	$	1,022.80		0.03	%	$	0.15
Hypothetical	$	1,000.00	$	1,024.71		0.03	%	$	0.15

* Fund expenses (net of fee waivers or subsidies, if any) are equal to the annualized expense ratio (provided in the table), multiplied by the average account value over the period, multiplied by the 182 days in the six-month period ended July 31, 2012, and divided by the 366 days in the Fund’s fiscal year ended January 31, 2013 (to reflect the six-month period). Expenses presented in the table include the expenses of any underlying portfolios in which the Fund may invest.

2 Visit our website at www.prudentialfunds.com

Prudential Core Taxable Money Market Fund

Portfolio of Investments

as of July 31, 2012 (Unaudited)

Principal Amount (000)		Description	Value (Note 1)
	Banker’s Acceptance    0.1%
$	25,000	U.S. Bank National Association 0.501%, 11/19/12(a)	$	24,961,805
	Certificates of Deposit    10.1%
	92,000	Bank of Montreal (Chicago Branch) 0.651%, 10/25/12(b)		92,029,498
		Bank of Nova Scotia (Houston Branch)
	196,600	0.210%, 09/10/12		196,600,000
	5,000	0.716%, 08/09/12(b)		5,000,168
		Bank of Tokyo-Mitsubishi UFJ Ltd.
	170,000	0.350%, 08/13/12		170,000,000
	49,500	0.360%, 08/03/12		49,500,000
	53,000	0.360%, 10/23/12		53,000,000
	190,500	Barclays Bank PLC 0.736%, 08/02/12(b)		190,500,000
		Branch Banking and Trust Co.
	50,000	0.260%, 09/05/12		50,000,000
	264,700	0.270%, 11/30/12		264,700,000
		Canadian Imperial Bank of Commerce
	177,000	0.507%, 01/30/13(b)		177,000,000
	49,000	0.767%, 11/21/12(b)		49,037,853
		Credit Suisse (NY Branch)
	196,000	0.847%, 01/30/13(b)		196,000,000
	125,000	0.945%, 07/25/13(b)		125,000,000
	127,000	Nordea Bank Finland PLC 0.610%, 08/09/12		127,000,000
		Rabobank Nederland (NY Branch)
	174,000	0.616%, 05/02/13(b)		173,993,469
	70,000	0.616%, 05/04/13(b)		69,995,322
	279,600	Royal Bank of Canada (NY Branch) 0.508%, 07/11/13(b)		279,600,000
	237,600	Societe Generale 0.400%, 08/27/12		237,600,000
	234,650	State Street Bank & Trust Co. 0.220%, 08/30/12		234,650,000
		Sumitomo Mitsui Banking Corp.
	34,500	0.350%, 09/12/12		34,503,125
	92,000	0.350%, 10/12/12		92,000,000
	139,000	0.400%, 09/10/12		139,021,579

See Notes to Financial Statements.

Prudential Investment Portfolios 2/Prudential Core Taxable Money Market Fund 3

Prudential Core Taxable Money Market Fund

Portfolio of Investments

as of July 31, 2012 (Unaudited) continued

Principal Amount (000)		Description	Value (Note 1)
	Certificates of Deposit (cont’d.)
$	115,000	Svenska Handelsbanken AB 0.310%, 09/25/12	$	115,000,000
	260,650	Toronto Dominion Bank 0.448%, 07/26/13(b)		260,650,000
	13,950	Westpac Banking Corp. 0.646%, 02/06/13(b)		13,964,807
				3,396,345,821
	Commercial Paper    17.1%
		ABN AMRO Funding USA LLC, 144A
	132,500	0.531%, 09/19/12(a)		132,404,416
	119,000	0.531%, 09/20/12(a)		118,912,403
		BASF AG, 144A
	78,000	0.210%, 09/05/12(a)		77,984,075
	61,600	0.220%, 08/20/12(a)		61,592,848
		Commonwealth Bank of Australia, 144A
	75,000	0.250%, 09/10/12(a)		74,979,167
	111,642	0.250%, 09/17/12(a)		111,605,561
	279,500	Credit Agricole North America, Inc. 0.500%, 09/04/12(a)		279,368,014
	49,600	Credit Suisse (NY Branch) 0.330%, 09/10/12(a)		49,581,813
		DNB Bank ASA, 144A
	192,500	0.526%, 09/12/12(a)		192,382,094
	114,000	0.528%, 09/14/12(b)		114,000,000
		Electricite de France, 144A
	135,500	0.350%, 08/27/12(a)		135,465,749
	29,000	0.551%, 10/12/12(a)		28,968,100
	50,000	0.551%, 10/15/12(a)		49,942,708
		GDF Suez, 144A
	110,000	0.250%, 08/21/12(a)		109,984,722
	100,000	0.250%, 08/22/12(a)		99,985,417
	66,500	0.250%, 08/28/12(a)		66,487,531
		HSBC USA, Inc.
	240,311	0.300%, 08/16/12(a)		240,280,961
	66,000	0.300%, 08/20/12(a)		65,989,550
	60,000	0.300%, 08/23/12(a)		59,989,000
		International Finance Corp.
	100,000	0.130%, 08/10/12(a)		99,996,750

See Notes to Financial Statements.

4 Visit our website at www.prudentialfunds.com

Principal Amount (000)		Description	Value (Note 1)
	Commercial Paper (cont’d.)
$	51,000	0.130%, 08/21/12(a)	$	50,996,317
	35,000	0.130%, 08/24/12(a)		34,997,093
	75,000	0.130%, 08/28/12(a)		74,992,687
	74,400	0.135%, 08/08/12(a)		74,398,047
	268,500	JPMorgan Chase & Co. 0.299%, 09/12/12(b)		268,500,000
	128,000	Mizuho Funding LLC, 144A 0.210%, 08/03/12(a)		127,998,507
		Nordea North America
	30,000	0.310%, 09/28/12(a)		29,985,017
	87,073	0.572%, 08/31/12(a)		87,031,640
	180,000	0.602%, 08/03/12(a)		179,994,000
	50,000	Pacific Life Insurance Co., 144A 0.170%, 08/02/12(a)		49,999,764
		PNC Bank National Association
	154,500	0.210%, 08/16/12(a)		154,486,481
	78,000	0.220%, 09/13/12(a)		77,979,504
	78,000	Sanofi Aventis, 144A 0.210%, 09/20/12(a)		77,977,250
	83,600	Schlumberger Holdings Corp., 144A 0.250%, 08/14/12(a)		83,592,453
		Siemens Capital Co. LLC
	194,500	0.190%, 08/13/12, 144A(a)		194,487,682
	78,600	0.200%, 09/10/12(a)		78,582,533
	121,000	Skandinaviska Enskilda Banken AB, 144A 0.440%, 08/22/12(a)		120,968,943
		Standard Chartered Bank, 144A
	196,600	0.401%, 10/09/12(a)		196,449,273
	82,000	0.401%, 11/13/12(a)		81,905,245
	137,500	State Street Corp. 0.220%, 08/29/12(a)		137,476,472
		Svenska Handelsbanken, Inc., 144A
	194,500	0.300%, 09/07/12(a)		194,440,029
	25,350	0.562%, 08/27/12(a)		25,339,747
		Swedbank AB
	200,000	0.491%, 08/27/12(a)		199,929,222
	73,500	0.491%, 08/28/12(a)		73,472,989
		Total Capital Canada Ltd., 144A
	312,650	0.200%, 08/17/12(a)		312,622,209
	80,000	0.220%, 09/05/12(a)		79,982,889

See Notes to Financial Statements.

Prudential Investment Portfolios 2/Prudential Core Taxable Money Market Fund 5

Prudential Core Taxable Money Market Fund

Portfolio of Investments

as of July 31, 2012 (Unaudited) continued

Principal Amount (000)		Description	Value (Note 1)
	Commercial Paper (cont’d.)
$	128,000	Toyota Motor Credit Corp. 0.200%, 08/17/12(a)	$	127,988,622
		U.S. Bank National Association
	316,600	0.200%, 08/30/12		316,600,000
	10,000	0.511%, 08/17/12(a)		9,997,733
	55,400	Westpac Banking Corp., 144A 0.250%, 09/19/12(a)		55,381,149
				5,748,454,376
	Loan Participation    0.1%
	35,000	Archer-Daniels-Midland Co. 0.210%, 08/23/12(c)		35,000,000
	Municipal Bonds    1.1%
	47,000	CO St. Hsg. & Fin. Auth. Emp. Comp. Fd., Spl. Rev., Ser. B 0.450%, 05/15/13		47,000,000
	19,750	Houston TX Util. Sys. Rev., Rfdg. First Lien, Ser. B-4, F.R.W.D. 0.150%, 05/15/34(b)		19,750,000
		NY St. Urban Dev. Corp. Rev. Taxable, St. Pers. Income
	4,000	Tax, Ser. B 1.560%, 12/15/12		4,018,031
		NY Taxable
	7,995	Ser. D 4.500%, 11/01/12		8,078,986
	2,000	Subser. C-4 4.950%, 08/15/12		2,003,525
	116,200	Port Auth. NY & NJ Txbl. Consol. Nts., Ser. ZZ 1.000%, 12/01/12		116,469,538
		Univ. of TX Perm. Univ. Fd.,
	46,875	Ser. A, F.R.W.D. 0.130%, 07/01/37(b)		46,874,371
		Ser. B
	25,000	0.160%, 08/01/12		25,000,000
	18,500	0.170%, 10/01/12		18,499,060
	20,000	0.200%, 10/03/12		20,000,000
		Univ. of TX Var. Ref. Fing. Sys., Ser. B, F.R.W.D.
	58,840	0.130%, 08/01/34(b)		58,839,214
				366,532,725

See Notes to Financial Statements.

6 Visit our website at www.prudentialfunds.com

Principal Amount (000)		Description	Value (Note 1)
	Other Corporate Obligations    2.0%
$	11,000	Commonwealth Bank of Australia, 144A, MTN 0.598%, 08/24/12(b)	$	10,999,866
	141,500	MetLife Institutional Funding II, 144A 0.711%, 04/03/13(b)		141,500,000
	122,715	Metropolitan Life Global Funding I, 144A 2.875%, 09/17/12		123,022,568
		Toyota Motor Credit Corp., MTN
	165,750	0.611%, 04/03/13(b)		165,750,000
	96,750	0.666%, 11/09/12(b)		96,750,000
	131,500	Wachovia Corp., MTN 2.236%, 05/01/13(b)		133,188,215
				671,210,649
	Other Instrument—Agency Bond    0.4%
	139,000	General Electric Capital Corp., FDIC Gtd. Notes, MTN 0.468%, 09/21/12(b)		139,061,263
	Time Deposits    2.7%
	195,097	Credit Agricole CIB (NY Branch) 0.210%, 08/01/12		195,097,000
	200,000	Natixis 0.200%, 08/01/12		200,000,000
	499,000	U.S. Bank National Association 0.150%, 08/01/12		499,000,000
				894,097,000
	U.S. Government Agency Obligations    33.0%
		Federal Home Loan Bank
	237,000	0.100%, 08/31/12(a)		236,980,250
	50,000	0.120%, 08/16/12		49,999,139
	79,000	0.120%, 09/04/12(a)		78,991,047
	148,500	0.120%, 10/01/12(a)		148,469,805
	197,500	0.120%, 10/25/12(a)		197,444,042
	158,000	0.130%, 08/24/12(a)		157,986,877
	246,500	0.130%, 08/29/12(a)		246,475,076
	15,000	0.130%, 09/19/12(a)		14,997,346
	39,000	0.130%, 11/01/12(a)		38,987,043
	98,000	0.135%, 09/14/12(a)		97,983,830

See Notes to Financial Statements.

Prudential Investment Portfolios 2/Prudential Core Taxable Money Market Fund 7

Prudential Core Taxable Money Market Fund

Portfolio of Investments

as of July 31, 2012 (Unaudited) continued

Principal Amount (000)		Description	Value (Note 1)
	U.S. Government Agency Obligations (cont’d.)
$	30,000	0.140%, 09/21/12(a)	$	29,994,050
	240,500	0.150%, 10/30/12(a)		240,409,812
	39,000	0.152%, 09/26/12(a)		38,990,900
	197,500	0.170%, 08/22/12(a)		197,480,415
	25,000	0.170%, 01/16/13(a)		24,980,167
		Federal Home Loan Mortgage Corp.
	139,000	0.080%, 08/16/12(a)		138,995,367
	312,700	0.110%, 10/24/12(a)		312,619,740
	115,000	0.120%, 08/28/12(a)		114,989,650
	339,500	0.120%, 09/11/12(a)		339,453,602
	601,700	0.124%, 09/19/12(a)		601,598,646
	268,000	0.124%, 10/03/12(a)		267,941,795
	701,000	0.127%, 08/22/12(a)		700,948,123
	74,000	0.130%, 08/01/12(a)		74,000,000
	196,500	0.130%, 10/10/12(a)		196,450,329
	309,750	0.130%, 10/25/12(a)		309,654,924
	197,000	0.130%, 11/15/12(a)		196,924,593
	468,000	0.133%, 11/14/12(a)		467,818,175
	790,200	0.138%, 11/27/12(a)		789,843,096
	232,000	0.140%, 10/16/12(a)		231,931,431
	137,000	0.140%, 11/06/12(a)		136,948,320
	156,000	0.140%, 11/08/12(a)		155,939,940
	137,000	0.140%, 11/09/12(a)		136,946,722
	158,000	0.140%, 11/20/12(a)		157,931,797
	125,000	0.150%, 08/27/12(a)		124,986,458
	155,500	0.150%, 10/30/12(a)		155,441,687
	155,500	0.150%, 11/01/12(a)		155,440,392
	130,000	0.170%, 01/07/13(a)		129,902,392
	33,000	0.175%, 01/17/13(a)		32,972,890
	565,000	0.185%, 11/02/12(b)		565,037,347
	20,320	0.206%, 08/10/12(b)		20,320,052
	180,540	1.375%, 01/09/13		181,464,615
	12,000	4.625%, 10/25/12		12,123,744
	43,950	5.500%, 08/20/12		44,068,642
		Federal National Mortgage Association
	592,600	0.110%, 09/20/12(a)		592,509,464
	150,000	0.120%, 08/30/12(a)		149,985,500
	195,000	0.120%, 08/31/12(a)		194,980,500
	120,000	0.130%, 09/27/12(a)		119,975,300

See Notes to Financial Statements.

8 Visit our website at www.prudentialfunds.com

Principal Amount (000)		Description	Value (Note 1)
	U.S. Government Agency Obligations (cont’d.)
$	115,000	0.150%, 09/05/12(a)	$	114,983,229
	155,000	0.150%, 11/13/12(a)		154,932,833
	82,000	0.160%, 01/02/13(a)		81,943,876
	90,000	0.162%, 08/15/12(a)		89,994,330
	94,500	0.170%, 01/23/13(a)		94,421,906
	173,164	0.176%, 01/09/13(a)		173,027,581
	213,290	0.267%, 08/23/12(b)		213,298,596
	65,000	0.278%, 09/17/12(b)		65,010,831
	283,000	0.278%, 10/18/12(b)		283,074,772
	176,553	0.375%, 12/28/12		176,683,674
				11,057,686,660
	U.S. Treasury Obligations    2.7%
		U.S. Treasury Bills
	33,000	0.105%, 09/27/12(a)		32,994,514
	100,000	0.120%, 09/20/12(a)		99,983,333
	198,200	0.150%, 08/30/12(a)		198,176,877
		U.S. Treasury Notes
	77,500	0.500%, 11/30/12		77,582,480
	396,500	1.375%, 01/15/13		398,687,244
	113,700	2.875%, 01/31/13		115,221,774
				922,646,222
	Repurchase Agreements(d)    32.3%
		Barclays Capital, Inc.
	840,000	0.180%, dated 07/31/12, due 08/07/12 in the amount of $840,029,400 (cost $840,000,000)		840,000,000
		BNP Paribas Securities Corp.
	480,739	0.170%, dated 07/30/12, due 08/06/12 in the amount of $480,754,891 (cost $480,739,000)		480,739,000
	481,200	0.180%, dated 07/31/12, due 08/07/12 in the amount of $481,216,842 (cost $481,200,000)		481,200,000
	400,500	0.200%, dated 07/25/12, due 08/01/12 in the amount of $400,515,575 (cost $400,500,000)		400,500,000
		Credit Suisse Securities Corp.
	240,000	0.170%, dated 07/30/12, due 08/06/12 in the amount of $240,007,933 (cost $240,000,000)		240,000,000
		0.180%, dated 07/26/12, due 08/02/12 in the amount of
	460,000	$460,016,100 (cost $460,000,000)		460,000,000

See Notes to Financial Statements.

Prudential Investment Portfolios 2/Prudential Core Taxable Money Market Fund 9

Prudential Core Taxable Money Market Fund

Portfolio of Investments

as of July 31, 2012 (Unaudited) continued

Principal Amount (000)		Description	Value (Note 1)
	Repurchase Agreements(d) (cont’d.)
$	400,500	0.180%, dated 07/31/12, due 08/06/12 in the amount of $400,512,015 (cost $400,500,000)	$	400,500,000
	400,500	0.180%, dated 07/31/12, due 08/07/12 in the amount of $400,514,018 (cost $400,500,000)		400,500,000
		0.200%, dated 07/25/12, due 08/01/12 in the amount of
	401,000	$401,015,594 (cost $401,000,000)		401,000,000
	434,600	0.230%, dated 07/02/12, due 08/02/12 in the amount of $434,686,075 (cost $434,600,000)		434,600,000
		Deutsche Bank Securities, Inc.
	250,000	0.170%, dated 07/30/12, due 08/06/12 in the amount of $250,008,264 (cost $250,000,000)		250,000,000
	250,000	0.180%, dated 07/30/12, due 08/13/12 in the amount of $250,017,500 (cost $250,000,000)(c)		250,000,000
	368,111	0.190%, dated 07/31/12, due 08/01/12 in the amount of $368,112,943 (cost $368,111,000)		368,111,000
		0.200%, dated 07/25/12, due 08/01/12 in the amount of
	401,000	$401,015,594 (cost $401,000,000)		401,000,000
	320,000	0.220%, dated 07/06/12, due 08/07/12 in the amount of $320,062,578 (cost $320,000,000)		320,000,000
		Goldman Sachs & Co.
	411,000	0.180%, dated 07/26/12, due 08/02/12 in the amount of $411,014,385 (cost $411,000,000)		411,000,000
	400,515	0.180%, dated 07/27/12, due 08/03/12 in the amount of $400,529,018 (cost $400,515,000)		400,515,000
	401,000	0.190%, dated 07/25/12, due 08/01/12 in the amount of $401,014,815 (cost $401,000,000)		401,000,000
		HSBC Securities (USA), Inc.
	157,686	0.190%, dated 07/31/12, due 08/01/12 in the amount of $157,686,832 (cost $157,686,000)		157,686,000
		JPMorgan Securities, Inc.
	100,000	0.180%, dated 07/27/12, due 08/27/12 in the amount of $100,015,500 (cost $100,000,000)(c)		100,000,000
		Morgan Stanley & Co., Inc.
	893,180	0.190%, dated 07/31/12, due 08/01/12 in the amount of $893,184,714 (cost $893,180,000)		893,180,000
		RBS Securities, Inc.
	200,000	0.180%, dated 07/30/12, due 08/06/12 in the amount of $200,007,000 (cost $200,000,000)		200,000,000

See Notes to Financial Statements.

10 Visit our website at www.prudentialfunds.com

Principal Amount (000)		Description	Value (Note 1)
	Repurchase Agreements(d) (cont’d.)
$	250,000	0.190%, dated 07/27/12, due 08/03/12 in the amount of $250,009,236 (cost $250,000,000)	$	250,000,000
	401,000	0.200%, dated 07/25/12, due 08/01/12 in the amount of $401,015,594 (cost $401,000,000)		401,000,000
	240,000	0.200%, dated 07/26/12, due 08/02/12 in the amount of $240,009,333 (cost $240,000,000)		240,000,000
		UBS Securities LLC
	401,000	0.200%, dated 07/25/12, due 08/01/12 in the amount of $401,015,594 (cost $401,000,000)		401,000,000
	400,500	0.200%, dated 07/25/12, due 08/24/12 in the amount of $400,566,750 (cost $400,500,000)(c)		400,500,000
	400,500	0.200%, dated 07/27/12, due 08/27/12 in the amount of $400,568,975 (cost $400,500,000)(c)		400,500,000
	40,000	0.200%, dated 07/31/12, due 08/01/12 in the amount of $40,000,222 (cost $40,000,000)		40,000,000
				10,824,531,000
		Total Investments    101.6% (amortized cost $34,080,527,521)(e)		34,080,527,521
		Liabilities in excess of other assets    (1.6%)		(520,851,696	)
		Net Assets    100.0%	$	33,559,675,825

The following abbreviations are used in the portfolio descriptions:

144A—Security was purchased pursuant to Rule 144A under the Securities Act of 1933 and may not be resold subject to that rule except to qualified institutional buyers. Unless otherwise noted, 144A securities are deemed to be liquid.

F.R.W.D.—Floating Rate (Weekly) Demand

FDIC—Federal Deposit Insurance Corp.

FHLMC—Federal Home Loan Mortgage Corp.

FNMA—Federal National Mortgage Association

GNMA—Government National Mortgage Association

MTN—Medium Term Note

(a) Rate quoted represents yield-to-maturity as of purchase date.

(b) Variable rate instrument. The interest rate shown reflects the rate in effect at July 31, 2012.

(c) Indicates a security that has been deemed illiquid.

See Notes to Financial Statements.

Prudential Investment Portfolios 2/Prudential Core Taxable Money Market Fund 11

Prudential Core Taxable Money Market Fund

Portfolio of Investments

as of July 31, 2012 (Unaudited) continued

(d) Repurchase agreements are collateralized by the following U.S. Government Agency and other FDIC guaranteed securities, with the aggregate value, including accrued interest, of $11,045,165,001:

Issue	Coupon Rate	Maturity Dates
FHLMC	2.50% - 10.25%	08/01/12 - 08/01/42
FNMA	2.50% - 11.00%	08/01/12 - 01/01/52
GMAC LLC	0.47%	12/19/12
GNMA	3.00% - 7.00%	02/15/21 - 07/15/42

(e) The cost of securities for federal income tax purposes is substantially the same as for financial reporting purposes.

Various inputs are used in determining the value of the Fund’s investments. These inputs are summarized in the three broad levels listed below.

Level 1—quoted prices generally in active markets for identical securities.

Level 2—other significant observable inputs including, but not limited to, quoted prices for similar securities, interest rates and yield curves, prepayment speeds, foreign currency exchange rates, and amortized cost.

Level 3—significant unobservable inputs for securities valued in accordance with Board approved fair valuation procedures.

The following is a summary of the inputs used as of July 31, 2012 in valuing such portfolio securities:

	Level 1		Level 2		Level 3
Investments in Securities
Banker’s Acceptance	$	—	$	24,961,805	$	—
Certificates of Deposit		—		3,396,345,821		—
Commercial Paper		—		5,748,454,376		—
Loan Participation		—		35,000,000		—
Municipal Bonds		—		366,532,725		—
Other Corporate Obligations		—		671,210,649		—
Other Instrument—Agency Bond		—		139,061,263		—
Time Deposits		—		894,097,000		—
U.S. Government Agency Obligations		—		11,057,686,660		—
U.S. Treasury Obligations		—		922,646,222		—
Repurchase Agreements		—		10,824,531,000		—
Total	$	—	$	34,080,527,521	$	—

See Notes to Financial Statements.

12 Visit our website at www.prudentialfunds.com

The industry classification of portfolio holdings and liabilities in excess of other assets shown as a percentage of net assets as of July 31, 2012 were as follows:

U.S. Government Agency Obligations	33.0	%
Repurchase Agreements	32.3
Commercial Paper	17.1
Certificates of Deposit	10.1
Time Deposits	2.7
U.S. Treasury Obligations	2.7
Other Corporate Obligations	2.0
Municipal Bonds	1.1
Other Instrument—Agency Bond	0.4
Banker’s Acceptance	0.1
Loan Participation	0.1
	101.6
Liabilities in excess of other assets	(1.6	)
	100.0	%

See Notes to Financial Statements.

Prudential Investment Portfolios 2/Prudential Core Taxable Money Market Fund 13

Prudential Core Taxable Money Market Fund

Statement of Assets and Liabilities

as of July 31, 2012 (Unaudited)

Assets
Unaffiliated investments, at amortized cost which approximates fair value	$	34,080,527,521
Cash		788
Interest receivable		7,211,965
Prepaid expenses		441
Total assets		34,087,740,715
Liabilities
Payable for investments purchased		521,292,421
Dividends payable		6,515,185
Management fee payable		137,462
Accrued expenses		103,155
Affiliated transfer agent fee payable		16,667
Total liabilities		528,064,890
Net Assets	$	33,559,675,825
Net assets were comprised of:
Common stock, at par	$	33,559,683
Paid-in capital in excess of par		33,526,102,268
		33,559,661,951
Undistributed net investment income		13,874
Net assets, July 31, 2012	$	33,559,675,825
Net asset value, offering price and redemption price per share ($33,559,675,825 ÷ 33,559,683,046 shares of $.001 par value common stock issued and outstanding)	$	1.00

See Notes to Financial Statements.

14 Visit our website at www.prudentialfunds.com

Prudential Core Taxable Money Market Fund

Statement of Operations

Six Months Ended July 31, 2012 (Unaudited)

Net Investment Income
Income
Unaffiliated interest (net of foreign withholding taxes of $94)	$	36,382,893
Expenses
Management fee		688,550
Custodian’s fees and expenses		86,000
Insurance expense		80,000
Transfer agent’s fees and expenses (including affiliated expense of $50,000) (Note 3)		51,000
Audit fee		11,000
Legal fees and expenses		9,000
Trustees’ fees		5,000
Reports to shareholders		4,000
Miscellaneous		14,033
Total expenses		948,583
Net investment income		35,434,310
Net Realized Gain On Investments
Net realized gain on investment transactions		702,625
Net Increase In Net Assets Resulting From Operations	$	36,136,935

See Notes to Financial Statements.

Prudential Investment Portfolios 2/Prudential Core Taxable Money Market Fund 15

Prudential Core Taxable Money Market Fund

Statement of Changes in Net Assets

(Unaudited)

	Six Months Ended July 31, 2012			Year Ended January 31, 2012
Increase (Decrease) In Net Assets
Operations
Net investment income	$	35,434,310		$	51,922,893
Net realized gain on investment transactions		702,625			844,946
Net increase in net assets resulting from operations		36,136,935			52,767,839
Dividends and distributions from net investment income and net realized gains (Note 1)		(36,149,741	)		(52,755,033	)
Fund share transactions (Note 6)
Net proceeds from shares sold		142,357,153,712			275,313,657,621
Net asset value of shares issued to shareholders in reinvestment of dividends and distributions		34,756,425			35,735,369
Cost of shares reacquired		(140,151,510,302	)		(264,599,317,632	)
Net increase in net assets from Fund share transactions		2,240,399,835			10,750,075,358
Total increase		2,240,387,029			10,750,088,164
Net Assets:
Beginning of period		31,319,288,796			20,569,200,632
End of period(a)	$	33,559,675,825		$	31,319,288,796
(a) Includes undistributed net investment income of:	$	13,874		$	26,680

See Notes to Financial Statements.

16 Visit our website at www.prudentialfunds.com

Prudential Core Short-Term Bond Fund

Portfolio of Investments

as of July 31, 2012 (Unaudited)

Description	Moody’s Ratings†	Interest Rate	Maturity Date		Principal Amount (000)		Value (Note 1)
LONG-TERM INVESTMENTS    88.3%
ASSET-BACKED SECURITIES    38.2%
Non-Residential Mortgage-Backed Securities    22.2%
Ally Auto Receivables Trust,
Ser. 2011-1, Class A2	Aaa	0.810%		10/15/13	$	359	$	358,606
Ser. 2011-2, Class A2	AAA(a)	0.670		10/15/13		717		716,769
Ser. 2011-3, Class A2(b)	Aaa	0.369		01/15/14		1,845		1,844,850
Ser. 2011-5, Class A3	AAA(a)	0.990		11/15/15		8,900		8,969,794
Ser. 2012-1, Class A3	Aaa	0.930		02/16/16		8,000		8,067,632
Ser. 2012-2, Class A3	Aaa	0.740		04/15/16		13,975		14,017,680
Ser. 2012-3, Class A2	Aaa	0.700		01/15/15		13,000		13,025,961
American Express Credit Account Master Trust,
Ser. 2008-6, Class A(b)	Aaa	1.449		02/15/18		11,840		12,219,472
Ser. 2009-2, Class A(b)	Aaa	1.499		03/15/17		34,020		34,827,090
Ser. 2010-1, Class A(b)	Aaa	0.499		11/15/15		3,000		3,004,674
Ser. 2011-1, Class A(b)	Aaa	0.419		04/17/17		16,595		16,623,958
BA Credit Card Trust,
Ser. 2006-A8, Class A8(b)	Aaa	0.279		05/15/16		5,750		5,745,141
Ser. 2006-A11, Class A11(b)	Aaa	0.279		04/15/16		30,774		30,752,674
Ser. 2007-A3, Class A3(b)	Aaa	0.269		11/15/16		1,000		997,289
Ser. 2007-A4, Class A4(b)	Aaa	0.289		11/15/19		6,227		6,150,838
Ser. 2007-A6, Class A6(b)	Aaa	0.309		09/15/16		5,000		4,995,445
Ser. 2007-A10, Class A10(b)	Aaa	0.319		12/15/16		12,000		11,993,640
Bank of America Auto Trust,
Ser. 2012-1, Class A3	Aaa	0.780		06/15/16		12,100		12,156,459
Bank One Issuance Trust,
Ser. 2004-A3, Class A3(b)	Aaa	0.419		02/15/17		11,200		11,229,254
BMW Vehicle Lease Trust,
Ser. 2011-1, Class A2	Aaa	0.640		04/22/13		3,360		3,360,454
Ser. 2012-1, Class A2	Aaa	0.590		06/20/14		15,000		15,016,215
CarMax Auto Owner Trust,
Ser. 2009-2, Class A3	AAA(a)	1.740		04/15/14		3,293		3,301,182
Ser. 2011-1, Class A2	Aaa	0.720		11/15/13		124		123,695
Ser. 2011-3, Class A3	Aaa	1.070		06/15/16		11,000		11,088,638
Ser. 2012-1, Class A3	AAA(a)	0.890		09/15/16		11,000		11,062,304
Ser. 2012-2, Class A2	Aaa	0.640		05/15/15		11,500		11,517,699
Chase Issuance Trust,
Ser. 2005-A11, Class A(b)	Aaa	0.319		12/15/14		1,000		1,000,148
Ser. 2007-A3, Class A3	Aaa	5.230		04/15/19		22,846		27,172,438

See Notes to Financial Statements.

Prudential Investment Portfolios 2/Prudential Core Short-Term Bond Fund 17

Prudential Core Short-Term Bond Fund

Portfolio of Investments

as of July 31, 2012 (Unaudited) continued

Description	Moody’s Ratings†	Interest Rate	Maturity Date		Principal Amount (000)		Value (Note 1)
ASSET-BACKED SECURITIES (Continued)
Non-Residential Mortgage-Backed Securities (cont’d.)
Ser. 2007-A8, Class A(b)	Aaa	0.269%		03/15/17	$	4,250	$	4,220,212
Ser. 2008-A6, Class A6(b)	Aaa	1.449		05/15/15		2,294		2,315,997
Ser. 2011-A3, Class A3(b)	AAA(a)	0.369		12/15/15		30,000		30,025,920
Citibank Credit Card Issuance Trust,
Ser. 2005-A9, Class A9	Aaa	5.100		11/20/17		21,150		24,194,860
Ser. 2006-A3, Class A3	Aaa	5.300		03/15/18		12,000		13,944,792
Ser. 2006-C1, Class C1(b)	Baa2	0.647		02/20/15		19,100		19,090,030
Ser. 2007-A8, Class A8	Aaa	5.650		09/20/19		6,030		7,363,788
Ser. 2008-A6, Class A6(b)	Aaa	1.447		05/20/17		2,800		2,883,429
Discover Card Master Trust,
Ser. 2007-A2, Class A2(b)	Aaa	0.808		06/15/15		3,650		3,654,223
Ser. 2009-A2, Class A(b)	Aaa	1.549		02/17/15		13,325		13,331,889
Ser. 2010-A1, Class A1(b)	Aaa	0.899		09/15/15		21,160		21,230,632
Ser. 2010-A2, Class A2(b)	AAA(a)	0.829		03/15/18		25,225		25,566,647
Ser. 2011-A3, Class A(b)	Aaa	0.459		03/15/17		2,000		2,004,460
Ser. 2012-A1, Class A1	Aaa	0.810		08/15/17		13,000		13,098,696
Ser. 2012-A3, Class A3	Aaa	0.860		11/15/17		1,500		1,511,630
Ser. 2012-A5, Class A5(b)	Aaa	0.446		01/16/18		14,000		14,000,000
Discover Card Master Trust I,
Ser. 2006-2, Class A3(b)	Aaa	0.329		01/19/16		6,412		6,415,738
Ford Credit Auto Lease Trust,
Ser. 2011-A, Class A2	Aaa	0.740		09/15/13		4,592		4,596,119
Ser. 2012-A, Class A2	Aaa	0.630		04/15/14		6,000		6,005,190
Ford Credit Auto Owner Trust,
Ser. 2009-D, Class A3	Aaa	2.170		10/15/13		715		716,049
Ser. 2009-E, Class A3	Aaa	1.510		01/15/14		386		386,618
Ser. 2011-B, Class A2	AAA(a)	0.680		01/15/14		2,280		2,281,283
Ser. 2012-A, Class A3	Aaa	0.840		08/15/16		15,000		15,088,005
Ser. 2012-B, Class A3	AAA(a)	0.720		12/15/16		6,200		6,226,592
GE Business Loan Trust,
Ser. 2003-2A, Class A, 144A(b)	Aa1	0.619		11/15/31		6,289		5,850,787
Ser. 2004-2A, Class A, 144A(b)	Aa1	0.469		12/15/32		6,421		5,844,714
Ser. 2006-2A, Class A, 144A(b)	Aa3	0.429		11/15/34		9,245		7,746,621
GE Capital Credit Card Master Note Trust,
Ser. 2012-4, Class A(b)	Aaa	0.549		06/15/18		50,000		50,002,900
Harley-Davidson Motorcycle Trust,
Ser. 2011-2, Class A2	Aaa	0.710		05/15/15		5,931		5,938,269

See Notes to Financial Statements.

18 Visit our website at www.prudentialfunds.com

Description	Moody’s Ratings†	Interest Rate	Maturity Date		Principal Amount (000)		Value (Note 1)
ASSET-BACKED SECURITIES (Continued)
Non-Residential Mortgage-Backed Securities (cont’d.)
Honda Auto Receivables Owner Trust,
Ser. 2010-1, Class A3	Aaa	1.250%		10/21/13	$	483	$	484,185
Ser. 2010-2, Class A3	Aaa	1.340		03/18/14		449		450,826
Ser. 2011-2, Class A2	Aaa	0.570		07/18/13		4,060		4,061,224
Ser. 2012-1, Class A3	Aaa	0.770		01/15/16		7,700		7,740,209
Hyundai Auto Lease Securitization Trust,
Ser. 2012-A, Class A2, 144A	Aaa	0.680		01/15/15		17,400		17,432,642
Hyundai Auto Receivables Trust,
Ser. 2009-A, Class A3	AAA(a)	2.030		08/15/13		26		25,615
Ser. 2010-A, Class A3	Aaa	1.500		10/15/14		917		920,256
Ser. 2011-B, Class A2	Aaa	0.590		03/15/14		7,457		7,459,889
MBNA Credit Card Master Note Trust,
Ser. 2003-A10, Class A10(b)	Aaa	0.509		03/15/16		6,500		6,512,942
Ser. 2006-A2, Class A2(b)	Aaa	0.309		06/15/15		1,000		1,000,015
Mercedes-Benz Auto Lease Trust,
Ser. 2011-B, Class A2, 144A	Aaa	0.900		01/15/14		22,977		23,019,399
Ser. 2012-A, Class A2	AAA(a)	0.660		04/15/14		13,000		13,017,953
Nissan Auto Lease Trust,
Ser. 2011-A, Class A2B(b)	Aaa	0.429		01/15/14		6,545		6,549,396
Nissan Auto Receivables Owner Trust,
Ser. 2011-A, Class A2	Aaa	0.650		12/16/13		3,965		3,967,435
Ser. 2011-B, Class A3	Aaa	0.950		02/16/16		14,500		14,614,304
Ser. 2012-A, Class A3	Aaa	0.730		05/16/16		2,500		2,511,578
Origen Manufactured Housing,
Ser. 2006-A, Class A1(b)	B2	0.399		11/15/18		1,271		1,255,201
Porsche Financial Auto Securitization Trust,
Ser. 2011-1, Class A2, 144A	Aaa	0.560		12/16/13		462		461,612
Tal Advantage LLC,
Ser. 2006-1A, 144A(b)	Baa2	0.437		04/20/21		3,750		3,620,473
Toyota Auto Receivables Owner Trust,
Ser. 2012-A, Class A2	Aaa	0.570		10/15/14		22,000		22,023,672
Volkswagen Auto Lease Trust,
Ser. 2011-A, Class A2	Aaa	1.000		02/20/14		13,820		13,857,008

See Notes to Financial Statements.

Prudential Investment Portfolios 2/Prudential Core Short-Term Bond Fund 19

Prudential Core Short-Term Bond Fund

Portfolio of Investments

as of July 31, 2012 (Unaudited) continued

Description	Moody’s Ratings†	Interest Rate	Maturity Date		Principal Amount (000)		Value (Note 1)
ASSET-BACKED SECURITIES (Continued)
Non-Residential Mortgage-Backed Securities (cont’d.)
Volkswagen Auto Loan Enhanced Trust,
Ser. 2010-1, Class A3	Aaa	1.310%		01/20/14	$	299	$	299,703
Ser. 2011-1, Class A2	AAA(a)	0.670		12/20/13		2,995		2,996,272
Ser. 2012-1, Class A3	AAA(a)	0.850		08/22/16		30,000		30,191,550
World Omni Auto Receivables Trust,
Ser. 2011-A, Class A2	Aaa	0.640		11/15/13		2,613		2,612,777
Ser. 2011-B, Class A2	Aaa	0.650		08/15/14		7,080		7,086,745
World Omni Automobile Lease Securitization Trust,
Ser. 2011-A, Class A2	Aaa	0.810		10/15/13		2,730		2,733,140
Ser. 2012-A, Class A2	Aaa	0.710		01/15/15		5,000		5,007,930
								798,790,040
Residential Mortgage-Backed Securities    16.0%
Accredited Mortgage Loan Trust,
Ser. 2004-4, Class A2D(b)	Aa1	0.596		01/25/35		2,363		2,075,614
Ace Securities Corp.,
Ser. 2003-HE1, Class M2(b)	Ca	2.796		11/25/33		176		116,868
Ser. 2003-OP1, Class M1(b)	Ba3	1.296		12/26/33		3,822		3,203,509
Ser. 2004-FM1, Class M1(b)	B2	1.146		09/25/33		742		606,419
Ser. 2004-OP1, Class M1(b)	Ba3	1.026		04/25/34		6,466		5,337,827
Ser. 2005-HE2, Class M2(b)	Aa2	0.696		04/25/35		678		663,071
Aegis Asset-Backed Securities Trust,
Ser. 2004-2, Class A1(b)	Aaa	0.546		06/25/34		263		243,924
Ameriquest Mortgage Securities, Inc.,
Ser. 2003-1, Class M1(b)	B1	1.596		02/25/33		10,891		8,905,787
Ser. 2003-8, Class M1(b)	B3	1.296		10/25/33		4,968		3,535,539
Ser. 2003-9, Class AV2(b)	A2	0.586		09/25/33		586		517,553
Ser. 2003-11, Class AV2(b)	Baa2	0.986		12/25/33		678		590,462
Ser. 2003-11, Class M1(b)	B1	1.281		12/25/33		668		476,384
Ser. 2003-12, Class M1(b)	B1	1.371		01/25/34		1,244		980,198
Ser. 2004-R3, Class A4(b)	Aaa	0.696		05/25/34		406		376,555
Ser. 2004-R5, Class M1(b)	Caa1	1.116		07/25/34		1,203		823,499
Ser. 2004-R6, Class A1(b)	A1	0.666		07/25/34		4,278		3,720,712
Ser. 2004-R8, Class M1(b)	A2	1.206		09/25/34		15,240		12,513,930
Ser. 2005-R3, Class A1B(b)	Aaa	0.506		05/25/35		1,514		1,351,571

See Notes to Financial Statements.

20 Visit our website at www.prudentialfunds.com

Description	Moody’s Ratings†	Interest Rate	Maturity Date		Principal Amount (000)		Value (Note 1)
ASSET-BACKED SECURITIES (Continued)
Residential Mortgage-Backed Securities (cont’d.)
Ser. 2005-R9, Class AF4(c)	Aaa	4.971%		11/25/35	$	1,500	$	1,513,605
Ser. 2005-R9, Class AF5(c)	Aa3	4.971		11/25/35		1,808		1,464,798
Ser. 2005-R11, Class A2D(b)	A3	0.576		01/25/36		330		286,794
Amortizing Residential Collateral Trust,
Ser. 2002-BC5, Class M2(b)	B2	2.046		07/25/32		103		40,872
Argent Securities, Inc.,
Ser. 2003-W2, Class M4(b)	B2	5.871		09/25/33		1,000		643,322
Ser. 2003-W3, Class M2(b)	B2	2.946		09/25/33		12,586		8,927,362
Ser. 2003-W4, Class M1(b)	A3	1.446		10/25/33		5,719		4,793,017
Ser. 2003-W5, Class M1(b)	Baa1	1.296		10/25/33		151		135,686
Ser. 2003-W7, Class A2(b)	Aaa	1.026		03/25/34		266		199,469
Ser. 2004-W5, Class M1(b)	Ba2	0.846		04/25/34		639		522,604
Ser. 2004-W6, Class AV2(b)	Aa2	0.696		05/25/34		488		415,699
Ser. 2004-W6, Class M1(b)	Baa1	0.796		05/25/34		1,800		1,443,439
Ser. 2004-W7, Class M1(b)	A2	0.796		05/25/34		18,431		14,273,468
Ser. 2004-W8, Class A2(b)	A2	1.206		05/25/34		247		213,093
Asset-Backed Funding Certificates,
Ser. 2003-AHL1, Class A1(c)	A1	4.184		03/25/33		717		685,976
Ser. 2003-OPT1, Class A3(b)	Baa1	0.926		04/25/33		1,164		953,381
Ser. 2004-HE1, Class M1(b)	Caa2	1.146		03/25/34		1,699		1,267,965
Ser. 2004-OPT5, Class A4(b)	AAA(a)	0.871		06/25/34		9,791		8,161,422
Ser. 2006-OPT1, Class A3D(b)	Ca	0.486		09/25/36		6,000		2,584,938
Asset-Backed Securities Corp.,
Ser. 2003-HE5, Class M2(b)	C	3.099		09/15/33		502		262,221
Ser. 2003-HE6, Class A2(b)	Aaa	0.926		11/25/33		193		153,460
Ser. 2004-HE1, Class M1(b)	Ba1	1.299		01/15/34		2,081		1,768,731
Ser. 2004-HE2, Class M1(b)	Ba3	1.071		04/25/34		428		354,374
Ser. 2004-HE3, Class M1(b)	Ba1	1.056		06/25/34		479		392,517
Ser. 2005-HE6, Class M1(b)	Aa1	0.736		07/25/35		965		950,581
Bear Stearns Asset-Backed Securities Trust,
Ser. 2003-3, Class M1(b)	B1	1.066		06/25/43		1,185		711,771
Ser. 2004-1, Class M1(b)	AA(a)	0.896		06/25/34		4,030		3,220,105
Ser. 2004-HE2, Class M1(b)	Ba1	1.146		03/25/34		7,087		5,612,642
Ser. 2004-HE7, Class M1(b)	Baa2	0.846		08/25/34		4,738		3,960,651
Ser. 2004-HE10, Class M1(b)	Baa1	1.221		12/25/34		1,216		940,666
Ser. 2007-FS1, Class 1A3(b)	Ca	0.416		05/25/35		19,000		6,459,278

See Notes to Financial Statements.

Prudential Investment Portfolios 2/Prudential Core Short-Term Bond Fund 21

Prudential Core Short-Term Bond Fund

Portfolio of Investments

as of July 31, 2012 (Unaudited) continued

Description	Moody’s Ratings†	Interest Rate	Maturity Date		Principal Amount (000)		Value (Note 1)
ASSET-BACKED SECURITIES (Continued)
Residential Mortgage-Backed Securities (cont’d.)
CDC Mortgage Capital Trust,
Ser. 2003-HE3, Class M1(b)	B3	1.296%		11/25/33	$	6,218	$	5,098,698
Ser. 2003-HE4, Class M1(b)	Baa1	1.221		03/25/34		2,242		1,835,075
Chase Funding Mortgage Loan Asset-Backed Certificates,
Ser. 2002-2, Class 2A1(b)	A1	0.746		05/25/32		430		389,259
Ser. 2003-1, Class 2A2(b)	A1	0.906		11/25/32		841		701,787
Ser. 2003-2, Class 2A2(b)	Aa2	0.806		02/25/33		589		513,127
Citicorp Residential Mortgage Securities, Inc.,
Ser. 2007-2, Class M3(c)	C	6.490		06/25/37		5,560		682,740
Citigroup Mortgage Loan Trust, Inc.,
Ser. 2004-OPT1, Class A2(b)	Aa2	0.606		10/25/34		1,039		1,014,084
Ser. 2005-HE3, Class M1(b)	Ba1	0.706		09/25/35		2,000		1,762,000
Conseco Finance,
Ser. 2001-C, Class M1(b)	A1	0.949		08/15/33		764		634,281
Countrywide Asset-Backed Certificates,
Ser. 2002-3, Class M1(b)	Ba3	1.371		03/25/32		262		203,743
Ser. 2003-2, Class 3A(b)	B1	0.744		08/26/33		418		303,911
Ser. 2003-3, Class M1(b)	Caa3	1.296		08/25/33		1,918		942,598
Ser. 2003-BC4, Class M1(b)	Ba3	1.296		07/25/33		418		349,206
Ser. 2004-1, Class M1(b)	Ba1	0.996		03/25/34		1,570		1,341,129
Ser. 2004-2, Class M1(b)	Caa1	0.996		05/25/34		3,074		2,280,304
Ser. 2004-ECC1, Class M1(b)	Ba1	1.191		11/25/34		4,835		4,060,581
Ser. 2005-2, Class M1(b)	Aa2	0.666		08/25/35		1,806		1,719,510
Ser. 2005-14, Class M1(b)	C	0.696		04/25/36		1,750		910,178
Ser. 2005-15, Class 1AF4(b)	Caa3	5.394		04/25/36		1,900		1,337,410
Credit Suisse First Boston Mortgage Securities Corp.,
Ser. 2001-HE17, Class A1(b)	Ba3	0.866		01/25/32		1,863		1,472,269
Ser. 2001-HE25, Class M1(b)	Ba3	1.846		03/25/32		632		442,620
Credit-Based Asset Servicing and Securitization LLC,
Ser. 2003-CB5, Class M1(b)	B2	1.266		11/25/33		1,673		1,412,676
Ser. 2004-CB3, Class M1(b)	Ba1	1.026		03/25/34		774		603,807

See Notes to Financial Statements.

22 Visit our website at www.prudentialfunds.com

Description	Moody’s Ratings†	Interest Rate	Maturity Date		Principal Amount (000)		Value (Note 1)
ASSET-BACKED SECURITIES (Continued)
Residential Mortgage-Backed Securities (cont’d.)
Equifirst Mortgage Loan Trust,
Ser. 2003-1, Class M2(b)	Ba1	3.096%		12/27/32	$	160	$	84,531
Ser. 2004-2, Class M1(b)	Baa1	0.796		10/25/34		1,980		1,446,011
Equity One ABS, Inc.,
Ser. 2003-1, Class M1	B2	4.860		07/25/33		157		132,770
Finance America Mortgage Loan Trust,
Ser. 2004-3, Class M1(b)	Ba1	1.116		11/25/34		11,482		8,776,823
First Franklin Mortgage Loan Asset-Backed Certificates,
Ser. 2004-FF5, Class A1(b)	AAA(a)	0.966		08/25/34		582		457,107
Ser. 2005-FFH4, Class M4(b)	C	0.896		12/25/35		3,500		174,993
First NLC Trust,
Ser. 2005-2, Class M1(b)	B1	0.726		09/25/35		2,500		1,782,195
Fremont Home Loan Trust,
Ser. 2003-B, Class M1(b)	Ba1	1.296		12/26/33		881		720,556
Ser. 2004-1, Class M1(b)	A3	0.921		02/25/34		2,015		1,543,253
Ser. 2004-2, Class M1(b)	A3	1.101		07/25/34		853		648,370
Ser. 2004-2, Class M2(b)	B1	1.176		07/25/34		2,293		1,823,247
Ser. 2004-B, Class M1(b)	Ba1	1.116		05/25/34		5,754		4,247,787
Ser. 2004-C, Class M1(b)	B1	1.221		08/25/34		9,288		6,899,897
GE-WMC Mortgage Securities LLC,
Ser. 2005-1, Class A2C(b)	Ba3	0.606		10/25/35		2,180		1,937,946
GSAMP Trust,
Ser. 2003-FM1, Class M2(b)	Ca	3.022		03/20/33		152		52,614
Ser. 2004-FM1, Class M1(b)	Ba3	1.221		11/25/33		11,089		9,071,750
Ser. 2004-FM1, Class M2(b)	Ca	2.346		11/25/33		225		155,934
Ser. 2004-NC1, Class M1(b)	B3	1.071		03/25/34		4,453		3,558,210
Ser. 2006-HE6, Class A3(b)	Ca	0.396		08/25/36		20,148		8,088,475
Home Equity Asset Trust,
Ser. 2002-3, Class M1(b)	B3	1.596		02/25/33		1,220		890,055
Ser. 2002-4, Class M1(b)	B3	1.746		03/25/33		1,179		911,842
Ser. 2003-2, Class M1(b)	B1	1.566		08/25/33		2,136		1,623,057
Ser. 2003-3, Class M1(b)	Ba3	1.536		08/25/33		2,584		2,115,665
Ser. 2003-4, Class M1(b)	Ba3	1.446		10/25/33		11,550		9,204,712
Ser. 2003-8, Class M1(b)	Ba1	1.326		04/25/34		1,036		849,919
Ser. 2004-1, Class M1(b)	B2	1.191		06/25/34		17,624		13,978,289

See Notes to Financial Statements.

Prudential Investment Portfolios 2/Prudential Core Short-Term Bond Fund 23

Prudential Core Short-Term Bond Fund

Portfolio of Investments

as of July 31, 2012 (Unaudited) continued

Description	Moody’s Ratings†	Interest Rate	Maturity Date		Principal Amount (000)		Value (Note 1)
ASSET-BACKED SECURITIES (Continued)
Residential Mortgage-Backed Securities (cont’d.)
Ser. 2004-2, Class M1(b)	Ba3	1.041%		07/25/34	$	4,355	$	3,206,800
Ser. 2004-3, Class M1(b)	Ba1	1.101		08/25/34		2,754		2,241,709
Ser. 2005-3, Class M2(b)	A1	0.686		08/25/35		1,466		1,415,248
Ser. 2005-5, Class M1(b)	A1	0.726		11/25/35		2,625		2,287,047
HSBC Home Equity Loan Trust,
Ser. 2005-3, Class A1(b)	Aaa	0.507		01/20/35		206		191,505
Ser. 2006-1, Class M1(b)	Aa1	0.527		01/20/36		12,057		10,807,659
Ser. 2006-1, Class M2(b)	Aa1	0.547		01/20/36		1,070		917,170
Ser. 2006-2, Class M1(b)	Aa1	0.517		03/20/36		5,039		4,489,787
Ser. 2006-2, Class M2(b)	Aa1	0.537		03/20/36		7,170		6,245,726
Ser. 2006-3, Class A4(b)	Aaa	0.487		03/20/36		7,997		6,990,634
Ser. 2007-1, Class AS(b)	Aaa	0.447		03/20/36		721		661,136
Ser. 2007-1, Class M1(b)	A1	0.627		03/20/36		430		322,482
Ser. 2007-2, Class A4(b)	A1	0.547		07/20/36		400		340,530
Ser. 2007-2, Class M2(b)	B2	0.617		07/20/36		1,000		663,344
Ser. 2007-3, Class A4(b)	Aa2	1.747		11/20/36		5,360		4,440,808
Ser. 2007-3, Class M2(b)	Ba1	2.747		11/20/36		3,500		2,160,144
HSI Asset Securitization Corp. Trust,
Ser. 2006-OPT4, Class 2A4(b)	B2	0.496		03/25/36		1,400		577,721
Long Beach Mortgage Loan Trust,
Ser. 2003-3, Class M1(b)	B3	1.371		07/25/33		2,380		1,849,335
Ser. 2003-4, Class M1(b)	B2	1.266		08/25/33		4,365		3,572,672
Ser. 2004-1, Class M1(b)	A3	0.996		02/25/34		29,430		23,613,867
Ser. 2004-1, Class M2(b)	Ba2	1.071		02/25/34		4,786		4,311,297
Ser. 2004-2, Class M1(b)	B1	0.776		06/25/34		12,497		10,216,331
Ser. 2004-3, Class M1(b)	Ba1	1.101		07/25/34		11,630		9,008,168
Mastr Asset-Backed Securities Trust,
Ser. 2004-OPT2, Class A1(b)	Aa2	0.596		09/25/34		806		677,515
Ser. 2004-OPT2, Class A2(b)	Aa1	0.596		09/25/34		170		144,524
Ser. 2004-WMC3, Class M1(b)	A1	1.071		10/25/34		2,056		1,583,560
Merrill Lynch Mortgage Investors, Inc.,
Ser. 2003-WMC2, Class M2(b)	Ba1	3.096		02/25/34		306		263,026
Ser. 2004-HE2, Class A1A(b)	AAA(a)	0.646		08/25/35		51		39,831
Ser. 2004-HE2, Class M1(b)	A-(a)	1.046		08/25/35		1,774		1,344,952
Ser. 2004-WMC1, Class M2(b)	B3	1.896		10/25/34		3,013		2,286,110

See Notes to Financial Statements.

24 Visit our website at www.prudentialfunds.com

Description	Moody’s Ratings†	Interest Rate	Maturity Date		Principal Amount (000)		Value (Note 1)
ASSET-BACKED SECURITIES (Continued)
Residential Mortgage-Backed Securities (cont’d.)
Morgan Stanley ABS Capital I,
Ser. 2002-NC6, Class M1(b)	Caa1	1.746%		11/25/32	$	1,019	$	781,351
Ser. 2003-HE1, Class M1(b)	Ba2	1.446		05/25/33		4,166		3,497,580
Ser. 2003-NC5, Class M1(b)	B3	1.521		04/25/33		6,995		5,731,847
Ser. 2003-NC5, Class M3(b)	C	3.696		04/25/33		225		88,905
Ser. 2003-NC8, Class M1(b)	Caa1	1.296		09/25/33		2,763		2,234,714
Ser. 2003-NC8, Class M2(b)	C	2.871		09/25/33		307		176,698
Ser. 2003-NC10, Class M1(b)	B2	1.266		10/25/33		640		502,465
Ser. 2004-HE1, Class A4(b)	AAA(a)	0.986		01/25/34		1,253		1,103,658
Ser. 2004-HE5, Class M1(b)	B3	1.191		06/25/34		1,864		1,528,577
Ser. 2004-HE7, Class M1(b)	A2	1.146		08/25/34		3,607		2,817,370
Ser. 2004-HE8, Class A4(b)	Aaa	0.626		09/25/34		469		361,697
Ser. 2004-HE8, Class M1(b)	Baa1	0.886		09/25/34		19,810		14,884,164
Ser. 2004-NC1, Class M1(b)	Baa2	1.296		12/27/33		2,258		1,977,680
Ser. 2004-NC5, Class M1(b)	Caa1	1.146		05/25/34		1,038		747,018
Ser. 2004-WMC2, Class M1(b)	Ba3	1.161		07/25/34		2,604		2,173,014
Ser. 2005-HE4, Class M2(b)	B1	0.716		07/25/35		1,000		483,642
Morgan Stanley Dean Witter Capital I,
Ser. 2002-AM2, Class M1(b)	B3	1.371		05/25/32		1,336		973,995
Ser. 2002-AM3, Class A3(b)	Aa2	1.226		02/25/33		2,205		1,875,352
Ser. 2002-AM3, Class M2(b)	Ca	3.246		02/25/33		475		323,658
Ser. 2002-NC5, Class M1(b)	B3	1.656		10/25/32		1,151		921,171
Ser. 2002-NC5, Class M2(b)	Ca	2.646		10/25/32		254		111,672
Ser. 2003-NC3, Class M1(b)	B3	1.596		03/25/33		1,219		1,002,227
Ser. 2003-NC3, Class M3(b)	Ca	3.621		03/25/33		350		127,419
New Century Home Equity Loan Trust,
Ser. 2003-4, Class M1(b)	Baa3	1.371		10/25/33		7,795		6,623,354
Ser. 2003-6, Class M1(b)	B3	1.326		01/25/34		12,408		10,183,022
Ser. 2004-1, Class M1(b)	B3	1.131		05/25/34		8,521		6,977,710
Ser. 2004-2, Class A4(b)	Aaa	0.796		08/25/34		2,430		1,952,289
Ser. 2004-3, Class M1(b)	Baa2	1.176		11/25/34		12,150		8,613,395
Ser. 2004-4, Class M1(b)	Ba1	1.011		02/25/35		17,258		13,375,141
Option One Mortgage Loan Trust,
Ser. 2002-6, Class M1(b)	Caa3	1.371		11/25/32		253		179,193
Ser. 2003-2, Class A2(b)	Baa3	0.846		04/25/33		1,959		1,626,059
Ser. 2003-5, Class A2(b)	Baa3	0.886		08/25/33		805		657,564

See Notes to Financial Statements.

Prudential Investment Portfolios 2/Prudential Core Short-Term Bond Fund 25

Prudential Core Short-Term Bond Fund

Portfolio of Investments

as of July 31, 2012 (Unaudited) continued

Description	Moody’s Ratings†	Interest Rate	Maturity Date		Principal Amount (000)		Value (Note 1)
ASSET-BACKED SECURITIES (Continued)
Residential Mortgage-Backed Securities (cont’d.)
Ser. 2003-6, Class A2(b)	A1	0.906%		11/25/33	$	2,268	$	1,881,906
Ser. 2004-1, Class M1(b)	B3	1.146		01/25/34		2,492		2,064,232
Ser. 2004-2, Class M1(b)	B2	1.041		05/25/34		6,000		4,738,368
Ser. 2005-3, Class M1(b)	A3	0.716		08/25/35		2,460		1,840,021
Park Place Securities, Inc.,
Ser. 2004-WCW1, Class M2(b)	A1	0.926		09/25/34		1,500		1,369,470
Popular ABS Mortgage Pass-Through Trust,
Ser. 2004-4, Class M1(c)	Ba1	5.181		09/25/34		1,705		1,173,880
Ser. 2005-5, Class AF4(c)	Caa2	5.297		11/25/35		2,250		1,348,893
Ser. 2005-B, Class M1(b)	Aa3	0.726		08/25/35		2,500		2,386,779
Ser. 2006-B, Class A3(b)	Ba3	0.526		05/25/36		2,453		1,950,292
Quest Trust,
Ser. 2006-X1, Class A2, 144A(b)	Ca	0.436		03/25/36		7,345		2,679,913
Ser. 2006-X2, Class A2, 144A(b)	Ca	0.536		08/25/36		6,000		2,219,118
Renaissance Home Equity Loan Trust,
Ser. 2003-1, Class A(b)	Aa3	1.106		06/25/33		566		443,070
Ser. 2004-1, Class M2(b)	Caa3	1.496		05/25/34		408		176,062
Residential Asset Mortgage Products, Inc.,
Ser. 2004-RS3, Class AI4(b)	Baa1	5.335		03/25/34		800		771,270
Ser. 2004-RS8, Class AI5(c)	Ba1	5.980		08/25/34		15,000		14,769,105
Residential Asset Securities Corp.,
Ser. 2003-KS11, Class AI5(c)	A2	5.550		01/25/34		4,600		4,528,585
Ser. 2004-KS1, Class AI5(c)	Baa3	5.221		02/25/34		4,000		3,792,772
Ser. 2004-KS3, Class AI5(c)	Ba1	4.770		04/25/34		7,750		6,905,575
Ser. 2004-KS5, Class AI5(c)	Caa1	5.600		06/25/34		10,308		9,814,556
Ser. 2005-EMX5, Class A3(b)	C	0.576		12/25/35		3,068		765,473
Ser. 2005-KS3, Class M3(b)	Baa2	0.676		04/25/35		4,362		4,115,521
Ser. 2006-KS1, Class A4(b)	Ba2	0.546		02/25/36		470		365,968
Ser. 2007-KS1, Class A4(b)	C	0.466		01/25/37		7,316		1,609,315
Ser. 2007-KS2, Class AI4(b)	C	0.466		02/25/37		7,500		1,985,932
Salomon Brothers Mortgage Securities VII, Inc.,
Ser. 2002-CIT1, Class M1(b)	AA-(a)	1.341		03/25/32		5,594		4,619,067

See Notes to Financial Statements.

26 Visit our website at www.prudentialfunds.com

Description	Moody’s Ratings†	Interest Rate	Maturity Date		Principal Amount (000)		Value (Note 1)
ASSET-BACKED SECURITIES (Continued)
Residential Mortgage-Backed Securities (cont’d.)
Saxon Asset Securities Trust,
Ser. 2001-2, Class M1(b)	Caa3	1.041%		03/25/31	$	747	$	428,566
Ser. 2001-3, Class M1(b)	Caa1	1.416		07/25/31		450		333,572
Ser. 2003-2, Class AF5(c)	Baa1	3.455		08/25/32		2,609		2,410,596
Ser. 2003-3, Class M2(b)	Caa3	2.646		12/26/33		171		97,992
Ser. 2004-1, Class M1(b)	B1	1.041		03/25/35		1,358		1,008,841
Ser. 2005-3, Class M1(b)	Aa3	0.706		11/25/35		7,309		6,578,736
Securitized Asset-Backed Receivables LLC Trust,
Ser. 2004-NC1, Class M1(b)	B1	1.026		02/25/34		7,491		6,073,244
Ser. 2006-FR3, Class A3(b)	Ca	0.496		05/25/36		5,050		2,117,914
Specialty Underwriting & Residential Finance,
Ser. 2003-BC1, Class M1(b)	Ba1	1.446		01/25/34		646		557,763
Ser. 2003-BC3, Class M1(b)	Ba2	1.221		08/25/34		9,137		7,478,354
Ser. 2004-BC1, Class M1(b)	A1	1.011		02/25/35		1,736		1,537,298
Ser. 2004-BC4, Class A1B(b)	A3	0.646		10/25/35		832		649,922
Ser. 2006-BC1, Class A2C(b)	Ba1	0.446		12/26/36		898		865,720
Structured Asset Investment Loan Trust,
Ser. 2003-BC1, Class A2(b)	AAA(a)	0.926		01/25/33		300		258,658
Ser. 2003-BC10, Class A4(b)	AAA(a)	1.246		10/25/33		10,448		8,572,889
Ser. 2004-2, Class A4(b)	AAA(a)	0.951		03/25/34		14,910		11,626,933
Ser. 2004-4, Class A4(b)	AAA(a)	1.046		04/25/34		3,782		3,114,057
Ser. 2004-7, Class A8(b)	AAA(a)	1.446		08/25/34		1,400		1,092,220
Structured Asset Securities Corp.,
Ser. 2006-OW1, Class A4, 144A(b)	B(a)	0.446		12/26/35		833		588,052
Wells Fargo Home Equity Trust,
Ser. 2004-1, Class 1A(b)	Aa3	0.546		04/25/34		5,243		4,525,657
Ser. 2004-1, Class 2A1(b)	A2	0.546		04/25/34		5,717		4,849,844
Ser. 2004-2, Class A21B(b)	Aa3	0.666		10/25/34		192		167,351
								575,273,891
Total asset-backed securities (cost $1,428,130,719)								1,374,063,931

See Notes to Financial Statements.

Prudential Investment Portfolios 2/Prudential Core Short-Term Bond Fund 27

Prudential Core Short-Term Bond Fund

Portfolio of Investments

as of July 31, 2012 (Unaudited) continued

Description	Moody’s Ratings†	Interest Rate	Maturity Date		Principal Amount (000)		Value (Note 1)
COMMERCIAL MORTGAGE-BACKED SECURITIES    14.1%
Banc of America Commercial Mortgage, Inc.,
Ser. 2005-1, Class A3	AAA(a)	4.877%		11/10/42	$	447	$	446,587
Ser. 2007-2, Class A2	AAA(a)	5.634		04/10/49		1,846		1,913,246
Ser. 2007-2, Class A2FL, 144A(b)	AAA(a)	0.396		04/10/49		18,343		17,232,630
Ser. 2007-3, Class A2FL, 144A(b)	Aaa	0.416		06/10/49		4,313		4,309,168
Ser. 2007-5, Class A3	AAA(a)	5.620		02/10/51		9,000		9,590,562
Bear Stearns Commercial Mortgage Securities,
Ser. 2006-PW11, Class A4(b)	AAA(a)	5.451		03/11/39		4,740		5,350,365
Ser. 2006-PW12, Class A4(b)	Aaa	5.718		09/11/38		1,045		1,196,592
Ser. 2007-PW17, Class A3	AAA(a)	5.736		06/11/50		22,000		23,008,436
Ser. 2007-T26, Class A2	AAA(a)	5.330		01/12/45		182		182,309
Citigroup Commercial Mortgage Trust,
Ser. 2006-C5, Class A3	Aaa	5.431		10/15/49		7,007		7,234,689
Citigroup/Deutsche Bank Commercial Mortgage Trust,
Ser. 2005-CD1, Class A2FL(b)	Aaa	0.368		07/15/44		625		624,486
Ser. 2006-CD2, Class A4(b)	Aaa	5.302		01/15/46		7,205		8,056,285
Commercial Mortgage Pass-Through Certificates,
Ser. 2006-C7, Class A4(b)	AAA(a)	5.749		06/10/46		8,100		9,175,721
Ser. 2006-CN2A, Class A2FL, 144A(b)	A(a)	0.466		02/05/19		2,266		2,201,461
Credit Suisse First Boston Mortgage Securities Corp.,
Ser. 2005-C2, Class A4	Aa2	4.832		04/15/37		12,020		12,962,729
Credit Suisse Mortgage Capital Certificates,
Ser. 2006-C1, Class A4(b)	AAA(a)	5.416		02/15/39		3,580		4,020,469
CW Capital Cobalt Ltd.,
Ser. 2007-C3, Class A2(b)	AAA(a)	5.731		05/15/46		2,160		2,160,625
GE Capital Commercial Mortgage Corp.,
Ser. 2005-C3, Class A4	AAA(a)	5.046		07/10/45		678		677,755
Greenwich Capital Commercial Funding Corp.,
Ser. 2005-GG5, Class A2	Aaa	5.117		04/10/37		6,212		6,231,382

See Notes to Financial Statements.

28 Visit our website at www.prudentialfunds.com

Description	Moody’s Ratings†	Interest Rate	Maturity Date		Principal Amount (000)		Value (Note 1)
COMMERCIAL MORTGAGE-BACKED SECURITIES (Continued)
Ser. 2006-GG7, Class A3(b)	Aaa	5.874%		07/10/38	$	1,346	$	1,344,902
Ser. 2006-GG7, Class A4(b)	Aaa	5.874		07/10/38		8,000		9,171,320
Ser. 2007-GG9, Class A2	Aaa	5.381		03/10/39		7,243		7,419,258
Ser. 2007-GG11, Class A2	AAA(a)	5.597		12/10/49		1,693		1,746,232
GS Mortgage Securities Corp. II,
Ser. 2006-GG6, Class A2(b)	AAA(a)	5.506		04/10/38		822		821,790
Ser. 2006-GG8, Class A4	Aaa	5.560		11/10/39		34,714		39,680,914
Ser. 2007-EOP, Class A1, 144A(b)	Aaa	1.103		03/06/20		8,223		8,193,173
JPMorgan Chase Commercial Mortgage Securities Corp., Ser. 2005-CB13, Class A2	Aaa	5.247		01/12/43		696		698,118
Ser. 2005-CB13, Class A2FL(b)	Aaa	0.374		01/12/43		3,042		3,028,094
Ser. 2005-CB13, Class A3A1(b)	Aaa	5.284		01/12/43		2,300		2,338,971
Ser. 2005-LDP5, Class A3(b)	Aaa	5.224		12/15/44		4,000		4,232,556
Ser. 2006-CB14, Class A4(b)	Aaa	5.481		12/12/44		10,510		11,741,951
Ser. 2006-CB14, Class ASB(b)	Aaa	5.506		12/12/44		777		821,316
Ser. 2006-LDP8, Class A3FL(b)	Aaa	0.409		05/15/45		24,000		23,174,136
Ser. 2007-CB19, Class A2(b)	Aaa	5.734		02/12/49		727		726,604
Ser. 2007-LD11, Class A2(b)	Aaa	5.800		06/15/49		4,603		4,751,859
Ser. 2007-LD11, Class A2FL(b)	Aaa	0.389		06/15/49		39,162		38,746,856
Ser. 2007-LD12, Class A2	Aaa	5.827		02/15/51		1,385		1,394,578
Ser. 2007-LDPX, Class A2	Aaa	5.434		01/15/49		4,989		5,440,245
Ser. 2007-LDPX, Class A2SF(b)	Aaa	0.379		01/15/49		11,195		11,081,910
LB Commercial Conduit Mortgage Trust, Ser. 2007-C3, Class A2FL, 144A(b)	Aaa	5.840		07/15/44		414		413,973
LB-UBS Commercial Mortgage Trust, Ser. 2005-C7, Class A2	AAA(a)	5.103		11/15/30		1,351		1,358,719
Ser. 2006-C1, Class A2	AAA(a)	5.084		02/15/31		3,517		3,529,260
Ser. 2006-C3, Class A2	Aaa	5.532		03/15/32		63		63,459
Ser. 2006-C6, Class A2	Aaa	5.262		09/15/39		159		158,844
Ser. 2007-C2, Class A2	AAA(a)	5.303		02/15/40		388		387,726
Merrill Lynch Mortgage Trust, Ser. 2005-CKI1, Class A4FL(b)	Aaa	0.499		11/12/37		16,000		15,960,592
Ser. 2006-C1, Class A4(b)	AAA(a)	5.659		05/12/39		15,000		17,129,415
Ser. 2006-C2, Class A4	Aaa	5.742		08/12/43		15,000		17,187,075
Ser. 2007-C1, Class A2FL, 144A(b)	A(a)	0.559		06/12/50		2,478		2,474,406

See Notes to Financial Statements.

Prudential Investment Portfolios 2/Prudential Core Short-Term Bond Fund 29

Prudential Core Short-Term Bond Fund

Portfolio of Investments

as of July 31, 2012 (Unaudited) continued

Description	Moody’s Ratings†	Interest Rate	Maturity Date		Principal Amount (000)		Value (Note 1)
COMMERCIAL MORTGAGE-BACKED SECURITIES (Continued)
Merrill Lynch/Countrywide Commercial Mortgage Trust, Ser. 2006-1, Class A3(b)	AAA(a)	5.480%		02/12/39	$	9,705	$	9,724,468
Ser. 2006-1, Class A4(b)	AAA(a)	5.430		02/12/39		5,000		5,635,570
Ser. 2006-2, Class A2(b)	Aaa	5.878		06/12/46		5,755		5,829,704
Ser. 2006-4, Class A2FL(b)	Aaa	0.369		12/12/49		5,764		5,749,274
Ser. 2007-5, Class A2FL, 144A(b)	Aaa	0.349		08/12/48		4,821		4,814,442
Ser. 2007-6, Class A2	Aaa	5.331		03/12/51		902		925,948
Ser. 2007-6, Class A2FL, 144A(b)	Aaa	0.389		03/12/51		24,710		24,452,117
Ser. 2007-8, Class ASB(b)	AAA(a)	5.896		08/12/49		1,728		1,831,251
Morgan Stanley Capital I, Ser. 2007-IQ14, Class A2FL(b)	Aaa	0.409		04/15/49		23,556		21,549,444
Wachovia Bank Commercial Mortgage Trust, Ser. 2003-C7, Class A2, 144A(b)	Aaa	5.077		10/15/35		575		599,524
Ser. 2004-C10, Class A4	Aaa	4.748		02/15/41		8,636		9,060,379
Ser. 2006-C23, Class A4	Aaa	5.418		01/15/45		13,350		14,883,688
Ser. 2006-C25, Class A4(b)	Aaa	5.736		05/15/43		6,045		6,904,768
Ser. 2006-C27, Class A3	Aaa	5.765		07/15/45		4,535		5,184,974
Ser. 2006-C29, Class A2	Aaa	5.275		11/15/48		1,186		1,194,285
Ser. 2006-C29, Class A3	Aaa	5.313		11/15/48		21,525		22,432,795
Ser. 2006-WL7A, Class A1, 144A(b)	Aaa	0.339		09/15/21		11,923		11,556,579
Ser. 2007-C30, Class A3	Aaa	5.246		12/15/43		742		756,536
Ser. 2007-C33, Class A3(b)	Aaa	5.900		02/15/51		1,390		1,466,557
Total commercial mortgage-backed securities (cost $484,833,988)								506,346,052
CORPORATE BONDS    35.1%
Automotive    2.7%
American Honda Finance Corp., Sr. Unsec’d. Notes, 144A	A1	1.625		09/20/13		15,000		15,174,810
Daimler Finance North America LLC, Gtd. Notes, 144A(b)	A3	1.071		03/28/14		40,000		39,942,880
Volkswagen International Finance NV (Netherlands), Gtd. Notes, 144A(b)	A3	0.911		10/01/12		25,000		25,005,550
Gtd. Notes, 144A(b)	A3	1.218		03/21/14		15,000		15,049,140
								95,172,380

See Notes to Financial Statements.

30 Visit our website at www.prudentialfunds.com

Description	Moody’s Ratings†	Interest Rate	Maturity Date		Principal Amount (000)		Value (Note 1)
CORPORATE BONDS (Continued)
Banking    13.1%
ABN AMRO Bank NV (Netherlands), Sr. Unsec’d. Notes, 144A(b)	A2	2.217%		01/30/14	$	30,000	$	30,118,800
American Express Credit Corp., Sr. Unsec’d. Notes, MTN(b)	A2	1.568		06/12/15		35,000		35,542,640
Australia & New Zealand Banking Group Ltd. (Australia), Sr. Unsec’d. Notes, 144A(b)	Aa2	1.198		01/10/14		25,000		25,052,000
Citigroup, Inc., Sr. Unsec’d. Notes	Baa2	2.250		08/07/15		30,000		30,000,000
Cooperatieve Centrale Raiffeisen-Boerenleenbank BA (Netherlands), Gtd. Notes	Aa2	1.850		01/10/14		30,000		30,354,450
Goldman Sachs Group, Inc. (The), Sr. Unsec’d. Notes(b)	A3	1.466		02/07/14		25,000		24,759,125
HSBC Bank PLC (United Kingdom), Sr. Unsec’d. Notes, 144A(b)	Aa3	1.255		01/17/14		30,000		30,068,700
ING Bank NV (Netherlands), Sr. Notes, 144A(b)	A2	1.775		10/18/13		25,000		25,081,250
Sr. Notes, 144A	A2	2.000		10/18/13		10,000		9,996,000
JPMorgan Chase & Co., Sr. Unsec’d. Notes, MTN(b)	A2	1.252		01/24/14		25,000		25,108,150
Morgan Stanley, Sr. Unsec’d. Notes(b)	Baa1	2.052		01/24/14		35,000		34,481,300
National City Bank, Sr. Unsec’d. Notes(b)	A2	0.567		03/01/13		20,000		20,029,460
Nordea Bank AB (Sweden), Sr. Unsec’d. Notes, 144A	Aa3	1.750		10/04/13		25,000		25,095,425
Royal Bank of Scotland PLC (The) (United Kingdom), Gtd. Notes	A3	3.250		01/11/14		5,000		5,072,560
Toronto-Dominion Bank (The) (Canada), Sr. Unsec’d. Notes, MTN(b)	Aaa	0.628		07/26/13		25,000		25,040,050
UBS AG (Switzerland), Sr. Unsec’d. Notes(b)	A2	1.447		01/28/14		30,000		29,985,690
Wells Fargo & Co., Sr. Notes(b)	A2	1.381		06/26/15		10,000		10,034,470
Sr. Notes	A2	1.500		07/01/15		30,000		30,291,030

See Notes to Financial Statements.

Prudential Investment Portfolios 2/Prudential Core Short-Term Bond Fund 31

Prudential Core Short-Term Bond Fund

Portfolio of Investments

as of July 31, 2012 (Unaudited) continued

Description	Moody’s Ratings†	Interest Rate	Maturity Date		Principal Amount (000)		Value (Note 1)
CORPORATE BONDS (Continued)
Banking (cont’d.)
Westpac Banking Corp. (Austria), Sr. Unsec’d. Notes, 144A, MTN(b)	Aa2	0.667%		11/26/12	$	25,000	$	24,996,975
								471,108,075
Brokerage    1.1%
BlackRock, Inc., Sr. Unsec’d. Notes(b)	A1	0.767		05/24/13		20,000		20,064,000
Sr. Unsec’d. Notes	A1	1.375		06/01/15		7,200		7,317,533
Lehman Brothers Holdings, Inc., Sr. Unsec’d. Notes, MTN(e)	NR	3.000		05/25/10		50,000		12,000,000
								39,381,533
Capital Goods    2.4%
Caterpillar Financial Services Corp., Notes	A2	1.550		12/20/13		10,000		10,152,730
Sr. Unsec’d. Notes, MTN	A2	1.375		05/20/14		25,000		25,382,275
Danaher Corp., Sr. Unsec’d. Notes(b)	A2	0.718		06/21/13		10,000		10,023,750
John Deere Capital Corp., Sr. Unsec’d. Notes, MTN(b)	A2	0.861		10/04/13		20,000		20,082,240
United Technologies Corp., Sr. Unsec’d. Notes(b)	A2	0.967		06/01/15		20,000		20,230,380
								85,871,375
Chemicals    1.1%
E.I. du Pont de Nemours & Co., Sr. Unsec’d. Notes(b)	A2	0.888		03/25/14		40,000		40,287,080
Consumer    1.7%
Clorox Co. (The), Sr. Unsec’d. Notes	Baa1	5.000		03/01/13		15,000		15,393,060
eBay, Inc., Sr. Unsec’d. Notes(f)	A2	0.875		10/15/13		12,000		12,082,728
VF Corp., Sr. Unsec’d. Notes(b)	A3	1.217		08/23/13		20,000		20,103,400
Western Union Co. (The), Sr. Unsec’d. Notes(b)	A3	1.048		03/07/13		13,725		13,777,018
								61,356,206

See Notes to Financial Statements.

32 Visit our website at www.prudentialfunds.com

Description	Moody’s Ratings†	Interest Rate	Maturity Date		Principal Amount (000)		Value (Note 1)
CORPORATE BONDS (Continued)
Electric    0.5%
DTE Energy Co., Sr. Unsec’d. Notes(b)	Baa2	1.167%		06/03/13	$	8,000	$	8,020,024
National Rural Utilities Cooperative Finance Corp.	A1	1.125		11/01/13		10,000		10,075,060
								18,095,084
Energy—Other    0.7%
Occidental Petroleum Corp., Sr. Unsec’d. Notes	A1	1.450		12/13/13		25,000		25,332,950
Foods    1.4%
PepsiAmericas, Inc., Gtd. Notes	Aa3	4.500		03/15/13		6,000		6,140,460
PepsiCo, Inc., Sr. Unsec’d. Notes	Aa3	0.875		10/25/13		20,000		20,079,800
SABMiller Holdings, Inc., Gtd. Notes, 144A	Baa1	1.850		01/15/15		23,000		23,540,086
								49,760,346
Healthcare & Pharmaceutical    1.9%
Quest Diagnostics, Inc., Gtd. Notes(b)	Baa2	1.318		03/24/14		20,000		20,159,100
Sanofi-Aventis SA (France), Sr. Unsec’d. Notes(b)(f)	A2	0.771		03/28/14		30,000		30,159,210
Teva Pharmaceutical Finance Co. BV (Curacao), Gtd. Notes(b)	A3	1.366		11/08/13		17,000		17,128,197
								67,446,507
Insurance    2.1%
MassMutual Global Funding II, Sr. Sec’d. Notes, 144A(b)	Aa2	0.961		09/27/13		35,000		35,169,715
Metropolitan Life Global Funding I, Sec’d. Notes, 144A(b)	Aa3	1.208		01/10/14		30,000		30,098,820
Principal Life Global Funding II, Gtd. Notes, 144A(b)	Aa3	1.080		07/09/14		9,800		9,795,335
								75,063,870

See Notes to Financial Statements.

Prudential Investment Portfolios 2/Prudential Core Short-Term Bond Fund 33

Prudential Core Short-Term Bond Fund

Portfolio of Investments

as of July 31, 2012 (Unaudited) continued

Description	Moody’s Ratings†	Interest Rate	Maturity Date		Principal Amount (000)		Value (Note 1)
CORPORATE BONDS (Continued)
Metals    0.8%
BHP Billiton Finance USA Ltd. (Australia), Gtd. Notes(b)	A1	0.737%		02/18/14	$	30,000	$	30,097,650
Non-Captive Finance    0.8%
General Electric Capital Corp., Sr. Unsec’d. Notes(b)(f)	A1	1.310		01/07/14		30,000		30,162,360
Technology    2.5%
Broadcom Corp., Sr. Unsec’d. Notes	A2	1.500		11/01/13		5,000		5,064,015
Hewlett-Packard Co., Sr. Unsec’d. Notes(b)	A3	0.593		09/13/12		18,000		18,004,713
International Business Machines Corp., Sr. Unsec’d. Notes	Aa3	0.550		02/06/15		30,000		30,029,880
Texas Instruments, Inc., Sr. Unsec’d. Notes(b)	A1	0.647		05/15/13		37,000		37,093,055
								90,191,663
Telecommunications    1.7%
BellSouth Corp., Gtd. Notes, 144A	A-2	4.020		04/26/13		35,000		35,846,055
Verizon Communications, Inc., Sr. Unsec’d. Notes(b)	A3	1.071		03/28/14		25,000		25,212,750
								61,058,805
Tobacco    0.6%
BAT International Finance PLC (United Kingdom), Gtd. Notes, 144A	Baa1	1.400		06/05/15		20,000		20,122,400
Total corporate bonds (cost $1,289,508,305)								1,260,508,284
MUNICIPAL BOND    0.5%
University of California Rev., Fltg. Rate Nts., Taxable, Ser. Y-1(b)(c) (cost $17,225,000)	Aa1	0.825		07/01/41		17,225		17,174,875

See Notes to Financial Statements.

34 Visit our website at www.prudentialfunds.com

Description	Moody’s Ratings†	Interest Rate	Maturity Date		Principal Amount (000)		Value (Note 1)
U.S. GOVERNMENT AGENCY OBLIGATIONS    0.4%
Federal Home Loan Bank(f)		0.125%		01/17/13	$	600	$	599,855
Federal Home Loan Mortgage Corp., Discount Notes(c)(f)		5.230		12/24/12		800,000		799,614
Federal National Mortgage Association(b)		0.267		11/23/12		10,000		10,003,330
Federal National Mortgage Association(f)		4.375		09/15/12		5,090		5,116,170
Total U.S. government agency obligations (cost $16,514,542)								16,518,969
Total long-term investments (cost $3,236,212,554)								3,174,612,111
					Shares
SHORT-TERM INVESTMENTS    13.3%
AFFILIATED MONEY MARKET MUTUAL FUND    1.3%
Prudential Investment Portfolios 2 - Prudential Core Taxable Money Market Fund (cost $46,095,789)(Note 3)(h)						46,095,789		46,095,789
					Principal Amount (000)
CERTIFICATES OF DEPOSIT    0.7%
Bank of Nova Scotia (Canada)(b)	Aa1	0.661		10/01/12	$	10,000,000		10,003,300
Bank of Nova Scotia (Canada)(b)	Aa1	0.755		10/18/12		15,000,000		15,014,955
Total certificates of deposit (cost $24,999,155)								25,018,255
COMMERCIAL PAPER(g)    9.7%
Airgas, Inc., 144A	P-2	0.450		08/01/12		18,000,000		17,999,775
Airgas, Inc., 144A	P-2	0.450		08/13/12		8,000,000		7,998,700
American Water Capital Corp., 144A	P-2	0.470		08/14/12		30,000,000		29,994,517
Apache Corp., 144A	P-2	0.400		08/06/12		12,118,000		12,117,192
Assa Abloy Financial Services AB, 144A	P-2	0.500		08/09/12		10,000,000		9,998,750
Bacardi USA, Inc., 144A	P-2	0.440		08/22/12		15,000,000		14,995,966
British Telecommunications PLC	P-2	1.520		06/03/13		30,000,000		29,695,500

See Notes to Financial Statements.

Prudential Investment Portfolios 2/Prudential Core Short-Term Bond Fund 35

Prudential Core Short-Term Bond Fund

Portfolio of Investments

as of July 31, 2012 (Unaudited) continued

Description	Moody’s Ratings†	Interest Rate	Maturity Date		Principal Amount (000)		Value (Note 1)
COMMERCIAL PAPER(g) (Continued)
Celgene Corp., 144A	P-2	0.460%		08/06/12	$	10,000,000	$	9,999,233
DCP Midstream LLC, 144A	P-2	0.450		08/17/12		11,000,000		10,997,663
DCP Midstream LLC, 144A	P-2	0.470		08/24/12		10,000,000		9,996,867
DCP Midstream LLC, 144A	P-2	0.480		08/13/12		10,000,000		9,998,267
Elsevier Finance SA, 144A	P-2	0.600		08/27/12		10,000,000		9,996,681
Glencore Funding LLC	P-2	0.560		08/17/12		10,000,000		9,997,356
Mattel, Inc., 144A	P-2	0.410		08/07/12		20,000,000		19,998,406
Northeast Utilities, 144A	P-2	0.440		08/06/12		10,145,000		10,144,256
Omnicom Capital, Inc., 144A	P-2	0.440		08/06/12		25,000,000		24,998,355
ONEOK, Inc., 144A	P-2	0.420		08/08/12		10,000,000		9,999,067
Pacific Gas & Electric Co., 144A	P-2	0.450		08/02/12		5,000,000		4,999,875
Volvo Treasury North America L.P., 144A	P-2	0.470		08/02/12		15,000,000		14,999,608
Weatherford International Ltd., 144A	P-2	0.430		08/07/12		11,415,000		11,414,045
Weatherford International Ltd., 144A	P-2	0.500		08/13/12		15,000,000		14,997,292
WPP CP Finance Plc, 144A	P-2	0.500		08/08/12		15,000,000		14,998,333
Xstrata Finance (Canada) Ltd., 144A	P-2	0.460		08/09/12		38,300,000		38,295,596
Total commercial paper (cost $348,556,029)								348,631,300
LOAN PARTICIPATIONS    1.6%
Simon Property Group(d)		0.500		08/17/12		40,000,000		40,000,000
Weingarten Realty Investors		0.500		08/03/12		20,000,000		20,000,000
Total loan participations (cost $60,000,000)								60,000,000
Total short-term investments (cost $479,650,973)								479,745,344
Total Investments    101.6% (cost $3,715,863,527)								3,654,357,455
Liabilities in excess of other assets(i)    (1.6)%								(58,177,538	)
Net Assets    100.0%							$	3,596,179,917

The following abbreviations are used in portfolio descriptions:

144A—Security was purchased pursuant to Rule 144A under the Securities Act of 1933 and may not be resold subject to that rule except to qualified institutional buyers. Unless otherwise noted, 144A securities are deemed to be liquid.

See Notes to Financial Statements.

36 Visit our website at www.prudentialfunds.com

LIBOR—London Interbank Offered Rate

LLC—Limited Liability Company

MTN—Medium Term Note

NR—Not Rated by Moody’s or Standard & Poor’s

USA—United States of America

† The ratings reflected are as of July 31, 2012. Ratings of certain bonds may have changed subsequent to that date. The Fund’s current prospectus contains a description of Moody’s and Standard and Poor’s ratings.

(a) Standard & Poor’s Rating.

(b) Variable rate instrument. The interest rate shown reflects the rate in effect at July 31, 2012.

(c) Represents zero coupon bond or step coupon bond. Rate shown reflects the effective yield/current coupon at July 31, 2012.

(d) Indicates a security that has been deemed illiquid.

(e) Represents issuer in default on interest payments and/or principal repayment; Non-income producing security.

(f) Represents security, or a portion thereof, segregated as collateral for swap agreements.

(g) Rate quoted represents yield-to-maturity as of purchase date.

(h) Prudential Investments LLC, the manager of the Fund, also serves as manager of the Prudential Investment Portfolios 2 - Prudential Core Taxable Money Market Fund.

(i) Includes net unrealized appreciation (depreciation) on the following derivative contracts held at reporting period end:

Interest rate swap agreements outstanding at July 31, 2012:

Notional Amount (000)#		Termination Date		Fixed Rate			Floating Rate	Fair Value			Upfront Premiums Paid/ (Received)		Unrealized (Depreciation)			Counterparty
	Over-the-counter swap agreements:
$	9,200		10/03/13		3.991	%	3 month LIBOR(a)	$	(503,398	)	$	—	$	(503,398	)	Royal Bank of Scotland PLC
	50,000		01/06/14		1.285		3 month LIBOR(a)		(659,365	)		—		(659,365	)	UBS AG
	20,000		03/03/14		2.158		3 month LIBOR(a)		(717,216	)		—		(717,216	)	Barclays Bank PLC
	50,000		12/15/14		2.606		3 month LIBOR(a)		(2,876,519	)		1,751		(2,878,270	)	Barclays Bank PLC
	50,000		01/23/15		0.698		3 month LIBOR(a)		(324,206	)		—		(324,206	)	Bank of Nova Scotia
	40,000		02/03/15		0.575		3 month LIBOR(a)		(204,946	)		—		(204,946	)	Bank of Nova Scotia
	25,000		06/22/15		0.640		3 month LIBOR(a)		(121,604	)		—		(121,604	)	Bank of Nova Scotia
	30,000		08/02/15		0.484		3 month LIBOR(a)		(2,505	)		—		(2,505	)	Bank of Nova Scotia
	20,000		12/07/15		0.757		3 month LIBOR(a)		(159,952	)		—		(159,952	)	Bank of Nova Scotia

See Notes to Financial Statements.

Prudential Investment Portfolios 2/Prudential Core Short-Term Bond Fund 37

Prudential Core Short-Term Bond Fund

Portfolio of Investments

as of July 31, 2012 (Unaudited) continued

Interest rate swap agreements outstanding at July 31, 2012 (continued):

Notional Amount (000)#		Termination Date		Fixed Rate			Floating Rate	Fair Value			Upfront Premiums Paid/ (Received)		Unrealized (Depreciation)			Counterparty
	Over-the-counter swap agreements (cont’d.):
$	25,000		12/15/15		2.938	%	3 month LIBOR(a)	$	(2,089,916	)	$	—	$	(2,089,916	)	Morgan Stanley Capital Services, Inc.
	25,000		04/13/16		0.925		3 month LIBOR(a)		(386,672	)		—		(386,672	)	Bank of Nova Scotia
	10,000		05/10/16		0.860		3 month LIBOR(a)		(113,054	)		—		(113,054	)	Bank of Nova Scotia
	15,000		05/16/16		0.890		3 month LIBOR(a)		(185,271	)		—		(185,271	)	Bank of Nova Scotia
	5,000		05/22/16		0.909		3 month LIBOR(a)		(64,733	)		—		(64,733	)	Bank of Nova Scotia
	8,400		06/15/17		2.880		3 month LIBOR(a)		(873,246	)		—		(873,246	)	Barclays Bank PLC
	13,000		05/16/18		4.531		3 month LIBOR(a)		(2,749,262	)		—		(2,749,262	)	Barclays Bank PLC
	20,000		02/18/20		4.762		3 month LIBOR(a)		(5,503,726	)		—		(5,503,726	)	Royal Bank of Scotland PLC
	10,000		12/15/20		3.855		3 month LIBOR(a)		(2,018,070	)		—		(2,018,070	)	Morgan Stanley Capital Services, Inc.
								$	(19,553,661	)	$	1,751	$	(19,555,412	)

(a) The Fund pays the fixed rate and receives the floating rate.

# Notional amount is shown in U.S. dollars unless otherwise stated.

Various inputs are used in determining the value of the Fund’s investments. These inputs are summarized in the three broad levels listed below.

Level 1—quoted prices generally in active markets for identical securities.

Level 2—other significant observable inputs including, but not limited to, quoted prices for similar securities, interest rates and yield curves, prepayment speeds, foreign currency exchange rates, and amortized cost.

Level 3—significant unobservable inputs for securities valued in accordance with Board approved fair valuation procedures.

See Notes to Financial Statements.

38 Visit our website at www.prudentialfunds.com

The following is a summary of the inputs used as of July 31, 2012 in valuing such portfolio securities:

	Level 1		Level 2			Level 3
Investments in Securities
Non-Residential Mortgage-Backed Securities	$	—	$	798,790,040		$	—
Residential Mortgage-Backed Securities		—		575,273,891			—
Commercial Mortgage-Backed Securities		—		506,346,052			—
Corporate Bonds		—		1,260,508,284			—
Municipal Bond		—		17,174,875			—
U.S. Government Agency Obligations		—		16,518,969			—
Affiliated Money Market Mutual Fund		46,095,789		—			—
Certificates of Deposit		—		25,018,255			—
Commercial Paper		—		348,631,300			—
Loan Participations		—		60,000,000			—
Other Financial Instruments*
Interest Rate Swap Agreements		—		(19,555,412	)		—
Total	$	46,095,789	$	3,588,706,254		$	—

* Other financial instruments are derivative instruments not reflected in the Portfolio of Investments, such as futures, forwards and swap contracts, which are recorded at the unrealized appreciation/depreciation on the instrument.

The industry classification of portfolio holdings and liabilities in excess of other assets shown as a percentage of net assets as of July 31, 2012 were as follows:

Non-Residential Mortgage-Backed Securities	22.2	%
Residential Mortgage-Backed Securities	16.0
Commercial Mortgage-Backed Securities	14.1
Banking	13.1
Commercial Paper	9.7
Automotive	2.7
Technology	2.5
Capital Goods	2.4
Insurance	2.1
Healthcare & Pharmaceutical	1.9
Consumer	1.7
Telecommunications	1.7
Loan Participations	1.6
Foods	1.4
Affiliated Money Market Mutual Fund	1.3	%
Brokerage	1.1
Chemicals	1.1
Metals	0.8
Non-Captive Finance	0.8
Certificates of Deposit	0.7
Energy—Other	0.7
Tobacco	0.6
Electric	0.5
Municipal Bond	0.5
U.S. Government Agency Obligations	0.4
	101.6
Liabilities in excess of other assets	(1.6	)
	100.0	%

See Notes to Financial Statements.

Prudential Investment Portfolios 2/Prudential Core Short-Term Bond Fund 39

Prudential Core Short-Term Bond Fund

Portfolio of Investments

as of July 31, 2012 (Unaudited) continued

The Fund invested in derivative instruments during the reporting period. The primary types of risk associated with these derivative instruments are credit risk and interest rate risk. The effect of such derivative instruments on the Fund’s financial position and financial performance as reflected in the Statement of Assets and Liabilities and Statement of Operations is presented in the summary below.

Fair values of derivative instruments as of July 31, 2012 as presented in the Statement of Assets and Liabilities:

Derivatives not designated as hedging instruments, carried at fair value	Asset Derivatives			Liability Derivatives
	Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value
Interest rate contracts	Premium paid for swap agreements	$	1,751	Unrealized depreciation on swap agreements	$	19,555,412

The effects of derivative instruments on the Statement of Operations for the six months ended July 31, 2012 are as follows:

Amount of Realized Gain or (Loss) on Derivatives Recognized in Income
Derivatives not designated as hedging instruments, carried at fair value	Swaps
Credit contracts	$	(387,167	)
Interest rate contracts		(2,837,231	)
Total	$	(3,224,398	)
Change in Unrealized Appreciation or (Depreciation) on Derivatives Recognized in Income
Derivatives not designated as hedging instruments, carried at fair value	Swaps
Credit contracts	$	239,307
Interest rate contracts		(675,254	)
Total	$	(435,947	)

For the six months ended July 31, 2012, the Fund’s average volume of derivative activities is as follows:

Interest Rate Swaps (Notional Amount in USD (000))		Credit Default Swaps as Buyer (Notional Amount in USD (000))
$	357,033	$	10,000

See Notes to Financial Statements.

40 Visit our website at www.prudentialfunds.com

Prudential Core Short-Term Bond Fund

Statement of Assets and Liabilities

as of July 31, 2012 (Unaudited)

Assets
Investments at value:
Unaffiliated investments (cost $3,669,767,738)	$	3,608,261,666
Affiliated investments (cost $46,095,789)		46,095,789
Cash		172,209
Dividends and interest receivable		5,273,575
Premium paid for swap agreements		1,751
Prepaid expenses		173
Total assets		3,659,805,163
Liabilities
Payable for investments purchased		43,929,200
Unrealized depreciation on swap agreements		19,555,412
Accrued expenses		69,279
Management fee payable		54,677
Affiliated transfer agent fee payable		16,667
Dividends Payable		11
Total liabilities		63,625,246
Net Assets	$	3,596,179,917
Net assets were comprised of:
Common stock, at par	$	397,869
Paid-in capital in excess of par		3,968,374,919
		3,968,772,788
Undistributed net investment income		9,882,579
Accumulated net realized loss on investments		(301,413,966	)
Net unrealized depreciation on investments		(81,061,484	)
Net assets, July 31, 2012	$	3,596,179,917
Net asset value, offering price and redemption price per share ($3,596,179,917 ÷ 397,868,758 shares of $.001 par value common stock issued and outstanding)	$	9.04

See Notes to Financial Statements.

Prudential Investment Portfolios 2/Prudential Core Short-Term Bond Fund 41

Prudential Core Short-Term Bond Fund

Statement of Operations

Six Months Ended July 31, 2012 (Unaudited)

Net Investment Income
Income
Unaffiliated interest income	$	31,503,766
Affiliated dividend income		47,717
Total income		31,551,483
Expenses
Management fee		302,115
Custodian’s fees and expenses		53,000
Transfer agent’s fees and expenses (including affiliated expense of $50,000) (Note 3)		50,000
Insurance expense		31,000
Audit fee		16,000
Legal fees and expenses		9,000
Trustees’ fees		5,000
Reports to shareholders		4,000
Miscellaneous		11,354
Total expenses		481,469
Net investment income		31,070,014
Realized And Unrealized Gain (Loss) On Investments And Swap Agreements
Net realized gain (loss) on:
Investment transactions		3,013,857
Swap agreement transactions		(3,224,398	)
		(210,541	)
Net change in unrealized appreciation (depreciation) on:
Investments		50,426,836
Swap agreements		(435,947	)
		49,990,889
Net gain on investments		49,780,348
Net Increase In Net Assets Resulting From Operations	$	80,850,362

See Notes to Financial Statements.

42 Visit our website at www.prudentialfunds.com

Prudential Core Short-Term Bond Fund

Statement of Changes in Net Assets

(Unaudited)

	Six Months Ended July 31, 2012			Year Ended January 31, 2012
Increase (Decrease) In Net Assets
Operations
Net investment income	$	31,070,014		$	58,164,371
Net realized loss on investment transactions and swap agreements		(210,541	)		(3,420,993	)
Net change in unrealized appreciation (depreciation) on investments and swap agreements		49,990,889			(53,025,864	)
Net increase in net assets resulting from operations		80,850,362			1,717,514
Dividends from net investment income (Note 1)		(24,977,714	)		(48,360,018	)
Fund share transactions (Note 6)
Net asset value of shares issued to shareholders in reinvestment of dividends		24,977,681			49,437,161
Cost of shares reacquired		(25,000,000	)		(101,230,322	)
Net decrease in net assets from Fund share transactions		(22,319	)		(51,793,161	)
Total increase (decrease)		55,850,329			(98,435,665	)
Net Assets:
Beginning of period		3,540,329,588			3,638,765,253
End of period(a)	$	3,596,179,917		$	3,540,329,588
(a) Includes undistributed net investment income of:	$	9,882,579		$	3,790,279

See Notes to Financial Statements.

Prudential Investment Portfolios 2/Prudential Core Short-Term Bond Fund 43

Notes to Financial Statements

(Unaudited)

Prudential Investment Portfolios 2 (the “Core Fund”) is an open-end management investment company, registered under the Investment Company Act of 1940, as amended, (“1940 Act”).

The Core Fund consists of six separate series—the Prudential Core Taxable Money Market Fund (the “Money Market Fund”), the Prudential Core Short-Term Bond Fund (the “Short-Term Bond Fund”), the Short-Term Municipal Bond Fund, the National Municipal Money Market Fund, the Government Money Market Fund and the Treasury Money Market Fund (each, a “Fund” and collectively, the “Funds” or “Core Fund”). The Short-Term Municipal Bond Fund, the National Municipal Money Market Fund, the Government Money Market Fund and the Treasury Money Market Fund have not yet commenced operations.

The investment objective of the Money Market Fund is current income consistent with the preservation of capital and the maintenance of liquidity.

The investment objective of the Short-Term Bond Fund is income consistent with the relative stability of principal.

Shares of the Money Market Fund and the Short-Term Bond Fund are available only to investment companies managed by Prudential Investments LLC (“PI”) and certain investment advisory clients of the subadviser. At July 31, 2012, 100% of the shares outstanding were owned by such entities of which 1 shareholder held 5.2% of outstanding shares of the Short-Term Bond Fund and 1 shareholder held 8.3% of outstanding shares of the Money Market Fund.

Note 1. Accounting Policies

The following is a summary of significant accounting policies followed by the Funds in the preparation of its financial statements.

Securities Valuations: Each Fund holds portfolio securities and other assets that are fair valued at the close of each day the New York Stock Exchange (“NYSE”) is open for trading. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Board of Trustees has delegated fair valuation responsibilities to Prudential Investments LLC (“PI” or “Manager”) through the adoption of Valuation

44 Visit our website at www.prudentialfunds.com

Procedures for valuation of the Fund’s securities. Under the current Valuation Procedures, a Valuation Committee is established and responsible for supervising the valuation of portfolio securities and other assets. The Valuation Procedures allow the Fund to utilize independent pricing vendor services, quotations from market makers and other valuation methods in events when market quotations are not readily available. A record of Valuation Committee’s actions is subject to review, approval and ratification by the Board at its next regularly scheduled quarterly meeting.

Various inputs are used in determining the value of the Funds’ investments, which are summarized in the three broad levels hierarchies based on any observable inputs used as described in the table following each Fund’s Portfolio of Investments. The valuation methodologies and significant inputs used in determining the fair value of securities and other assets classified as Level 1, Level 2 and Level 3 of the hierarchy are as follows:

Investments in open-end, non-exchange-traded mutual funds are valued at their net asset value as of the close of the NYSE on the date of valuation. These securities are classified as Level 1 as these securities have the ability to be purchased or sold at their net asset value on the date of valuation.

Fixed income securities traded in the over-the-counter market, such as corporate bonds, municipal bonds, U.S. Government agencies, U.S. Treasury obligations, and sovereign issues are usually valued at prices provided by approved independent pricing vendors. The pricing vendors provide these prices usually after evaluating observable inputs including yield curves, credit rating, yield spreads, default rates, cash flows as well as broker/dealer quotations and reported trades. Securities valued using such vendor prices are classified as Level 2 of the fair value hierarchy.

Asset-backed and mortgage-related securities are usually valued by approved independent pricing vendors. The pricing vendors provide the prices using their internal pricing model with input from deal term, tranche level attributes, yield curve, prepayment speeds, and broker/dealer quotes. Securities valued using such vendor prices are classified as Level 2 of the fair value hierarchy.

Short-term debt securities of sufficient credit quality which mature in 60 days or less are valued at amortized cost which approximates fair market value. The amortized cost method involves valuing a security at its cost on the date of purchase and thereafter assuming a constant amortization to maturity of the difference between the principal amount due at maturity and cost. These securities are categorized as Level 2 of the fair value hierarchy.

The Money Market Fund values all of its securities of sufficient credit quality at amortized cost, which approximates fair value. The Short-Term Bond Fund values

Prudential Investment Portfolios 2 45

Notes to Financial Statements

(Unaudited) continued

short-term debt securities of sufficient credit quality which mature in 60 days or less at amortized cost, which approximates fair value. The amortized cost method involves valuing a security at its cost at the time of purchase and thereafter assuming a constant amortization to maturity of the difference between the principal amount due at maturity and cost. These securities are categorized as Level 2 of the fair value hierarchy.

Over-the-counter financial derivative instruments, such as option contracts, foreign currency contracts and swaps agreements, are usually valued using pricing vendor services, which derive the valuation based on underlying asset prices, indices, spreads, interest rates, exchange rates and other inputs. These instruments are categorized as Level 2 of the fair value hierarchy.

Securities and other assets that cannot be priced using the methods described above are valued with pricing methodologies approved by the Valuation Committee. In the event there are unobservable inputs used when determining such valuations, the securities will be classified as Level 3 of the fair value hierarchy.

When determining the fair value of securities, some of the factors influencing the valuation include: the nature of any restrictions on disposition of the securities; assessment of the general liquidity of the securities; the issuer’s financial condition and the markets in which it does business; the cost of the investment; the size of the holding and the capitalization of the issuer; the prices of any recent transactions or bids/offers for such securities or any comparable securities; any available analyst media or other reports or information deemed reliable by the investment adviser regarding the issuer or the markets or industry in which it operates. Using fair value to price securities may result in a value that is different from a security’s most recent closing price and from the price used by other mutual funds to calculate their net asset values.

Restricted and Illiquid Securities: The Money Market Fund may hold up to 10% and the Short-Term Bond Fund may hold up to 15% of their respective net assets in illiquid securities, including those which are restricted as to disposition under securities law (“restricted securities”). Restricted securities are valued pursuant to the valuation procedures noted above.

Repurchase Agreements: In connection with transactions in repurchase agreements with United States financial institutions, it is each Fund’s policy that its custodian or designated subcustodians, as the case may be under triparty repurchase agreements,

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takes possession of the underlying collateral securities, the value of which exceeds the principal amount of the repurchase transaction, including accrued interest. To the extent that any repurchase agreement exceeds one business day, the value of the collateral is marked-to-market on a daily basis to ensure the adequacy of the collateral. If the seller defaults and the value of the collateral declines or, if bankruptcy proceedings are commenced with respect to the seller of the security, realization of the collateral by the Funds may be delayed or limited.

Loan Participations: The Funds may invest in loan participations. When the Fund purchases a loan participation, the Fund typically enters into a contractual relationship with the lender or third party selling such participations (“Selling Participant”), but not the borrower. As a result, the Fund assumes the credit risk of the borrower and any other persons interpositioned between the Fund and the borrower. The Fund may not directly benefit from the collateral supporting the senior loan in which it has purchased the loan participation.

Swap Agreements: The Short-Term Bond Fund entered into credit default and interest rate swaps and may enter into total return and other forms of swap agreements. A swap agreement is an agreement to exchange the return generated by one instrument for the return generated by another instrument. Swap agreements are negotiated in the over-the-counter market and may be executed either directly with the counterparty (“OTC Traded”) or through a central clearing facility, such as a registered commodities exchange (“Exchange Traded”). The swap agreements are valued daily at current market value and any change in value is included in the net unrealized appreciation or depreciation on investments. Payments received or paid by the Fund are recorded as realized gains or losses upon termination or maturity of the swap. Risk of loss may exceed amounts recognized on the Statements of Assets and Liabilities. Swap agreements outstanding at period end, if any, are listed on the Portfolio of Investments.

Interest Rate Swaps: Interest rate swaps represent an agreement between counterparties to exchange cash flows based on the difference between two interest rates, applied to a notional principal amount for a specified period. The Fund is subject to interest rate risk exposure in the normal course of pursuing its investment objectives. The Fund used interest rate swaps to generate steady cash flow by receiving a stream of fixed rate payments and to increase exposure to prevailing market rates by receiving floating rate payments. The Fund’s maximum risk of loss from counterparty credit risk is the discounted net value of the cash flows to be received from the counterparty over the contract’s remaining life. This risk may be mitigated by having a master netting arrangement between the Fund and the counterparty which may permit the Fund to offset amounts payable by the Fund to the same counterparty against amounts to be received; and by the receipt of collateral

Prudential Investment Portfolios 2 47

Notes to Financial Statements

(Unaudited) continued

from the counterparty by the Fund to cover the Fund’s exposure to the counterparty. However, there is no assurance that such mitigating factors are easily enforceable.

Credit Default Swaps: Credit default swaps involve one party (the protection buyer) making a stream of payments to another party (the protection seller) in exchange for the right to receive a specified payment in the event of a default or as a result of a default (“credit event”) for the referenced party, typically corporate issues or sovereign issues of an emerging country, on its obligation; or in the event of a write-down, principal shortfall, interest shortfall or default of all or part of the referenced entities comprising a credit index.

The Fund is subject to credit risk in the normal course of pursuing its investment objectives. The Fund purchased credit default swaps to provide a measure of protection against defaults of the issuers. The Fund’s maximum risk of loss from counterparty credit risk for purchased credit default swaps is the notional value of a credit default swap agreement. A master netting arrangement between the Fund and the counterparty permits the Fund to offset amounts payable by the Fund to the same counterparty against amounts to be received; and by the receipt of collateral from the counterparty by the Fund to cover the Fund’s exposure to the counterparty. However, there is no assurance that such mitigating factors are easily enforceable.

As a buyer of protection, the Fund generally receives an amount up to the notional value of the swap if a credit event occurs.

In addition to each instrument’s primary underlying risk exposure (e.g. interest rate, credit, equity or foreign exchange, etc.), swap agreements involve, to varying degrees, elements of credit risk, market risk and documentation risk. Such risks involve the possibility that there will be no liquid market for these agreements, that the counterparty to the agreement may default on its obligation to perform or disagree as to the meaning of the contractual terms in the agreement, and that there will be unfavorable changes in net interest rates. In connection with these agreements, securities may be identified as collateral or received as collateral from the counterparty in accordance with the terms of the respective swap agreements to provide or receive assets of value and serve as recourse in the event of default or bankruptcy/insolvency of either party. Such over-the-counter derivative agreements include conditions which when materialized, give the counterparty the right to cause an early termination of the transactions under those agreements. Any election by the counterparty for early termination of the contract(s) may impact the amounts reported on financial statements.

48 Visit our website at www.prudentialfunds.com

As of July 31, 2012, the Fund has not met conditions under such agreements that give the counterparty the right to call for an early termination.

Securities Transactions and Net Investment Income: Securities transactions are recorded on the trade date. Realized gains (losses) on sales of securities are calculated on the identified cost basis. Interest income, including amortization of premium and accretion of discount and debt securities as required, is recorded on the accrual basis. Expenses are recorded on the accrual basis which may require the use of certain estimates by management.

Federal Income Taxes: For federal income tax purposes, each Fund is treated as a separate taxpaying entity. It is the Money Market Fund and the Short-Term Bond Fund’s policy to continue to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its net income and capital gains, if any, to its shareholders. Therefore, no federal income tax provision is required.

Dividends and Distributions: The Money Market Fund declares all of its net investment income and net realized short-term capital gains, if any, as dividends daily to its shareholders of record at the time of such declaration. The Short-Term Bond Fund declares all of its net investment income as dividends daily and pays monthly to its shareholders of record at the time of such declaration. Distributions of net realized capital gains, if any, are made annually. Dividends and capital gain distributions are determined in accordance with federal income tax regulations which differ from generally accepted accounting principles.

Estimates: The preparation of the financial statements requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates.

Note 2. Agreements

The Core Fund has a management agreement with PI. Pursuant to this agreement, PI has responsibility for all investment advisory services and supervises the subadviser’s performance of such services. PI has entered into a subadvisory agreement with Prudential Investment Management, Inc. (“PIM”). The subadvisory agreement provides that PIM will furnish investment advisory services in connection with the management of the Core Fund. In connection therewith, PIM is obligated to keep certain books and records of the Core Fund. PI pays for the services of PIM, the cost of compensation of officers of the Core Fund, occupancy and certain clerical

Prudential Investment Portfolios 2 49

Notes to Financial Statements

(Unaudited) continued

and bookkeeping costs of the Core Fund. The Core Fund bears all other costs and expenses.

For its services, PI will be reimbursed for its direct costs, exclusive of any profit or overhead. The costs are accrued daily and payable monthly. For the six months ended July 31, 2012, the costs were at an effective annual rate of .004% for the Money Market Fund and .017% for the Short-Term Bond Fund.

PI and PIM are indirect, wholly owned subsidiaries of Prudential Financial, Inc. (“Prudential”).

Note 3. Other Transactions with Affiliates

Prudential Mutual Fund Services LLC (“PMFS”), an affiliate of PI and an indirect wholly-owned subsidiary of Prudential, serves as the transfer agent of each Fund. Transfer agent’s fees and expenses in the Statement of Operations include certain out-of-pocket expenses paid to non-affiliates, where applicable.

The Short-Term Bond Fund invests in the Money Market Fund. Earnings from the Money Market Fund are disclosed on the Statement of Operations as affiliated dividend income.

Note 4. Portfolio Securities

The Short-Term Bond Fund’s purchases and sales of portfolio securities, other than short-term investments, for the six months ended July 31, 2012, were $873,834,867 and $887,147,727, respectively.

Note 5. Tax Information

Under the Regulated Investment Company Modernization Act of 2010 (“the Act”), the Core Funds are permitted to carryforward capital losses incurred in the fiscal year ended January 31, 2012 (“post-enactment losses”) for an unlimited period. Post enactment losses are required to be utilized before the utilization of losses incurred prior to the effective date of the Act. As a result of this ordering rule, capital loss carryforwards related to taxable years beginning before January 31, 2012 (“pre-enactment losses”) may have an increased likelihood to expire unused. Additionally,

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post-enactment capital losses that are carried forward will retain their character as either short-term or long-term capital losses rather than being considered all short-term as under previous law. No capital gains distributions are expected to be paid to shareholders until net gains have been realized in excess of such losses. As of January 31, 2012, the pre and post-enactment losses for Short-Term Bond Fund were approximately:

Post-Enactment Losses:	$	800,000
Pre-Enactment Losses:
Expiring 2016	$	8,441,000
Expiring 2017		115,725,000
Expiring 2018		157,486,000
Expiring 2019		18,751,000
	$	300,403,000

Management has analyzed the Funds’ tax positions taken on federal income tax returns for all open tax years and has concluded that no provision for income tax is required in the Funds’ financial statements for the current reporting period. The Funds’ federal and state income and federal excise tax returns for tax years for which the applicable statutes of limitations have not expired are subject to examination by the Internal Revenue Service and state departments of revenue.

Note 6. Capital

	Prudential Core Taxable Money Market Fund						Prudential Core Short-Term Bond Fund
	Shares			Amount			Shares			Amount
Six months ended July 31, 2012:
Shares sold		142,357,153,712		$	142,357,153,712			—		$	—
Shares issued in reinvestment of distributions		34,756,425			34,756,425			2,783,510			24,977,681
Shares reacquired		(140,151,510,302	)		(140,151,510,302	)		(2,771,618	)		(25,000,000	)
Net increase (decrease) in shares outstanding		2,240,399,835		$	2,240,399,835			11,892		$	(22,319	)
Year ended January 31, 2012:
Shares sold		275,313,657,621		$	275,313,657,621			—		$	—
Shares issued in reinvestment of distributions		35,735,369			35,735,369			5,525,898			49,437,161
Shares reacquired		(264,599,317,632	)		(264,599,317,632	)		(11,398,873	)		(101,230,322	)
Net increase (decrease) in shares outstanding		10,750,075,358		$	10,750,075,358			(5,872,975	)	$	(51,793,161	)

Prudential Investment Portfolios 2 51

Notes to Financial Statements

(Unaudited) continued

Note 7. Borrowings

The Short-Term Bond Fund, along with other affiliated registered investment companies (the “Funds”), is a party to a Syndicated Credit Agreement (“SCA”) with a group of banks. The purpose of the SCA is to provide an alternative source of temporary funding for capital share redemptions. The SCA provides for a commitment of $900 million for the period December 16, 2011 through December 14, 2012. The Funds pay an annualized commitment fee of 0.08% of the unused portion of the SCA. Interest on any borrowings under the SCA is paid at contracted market rates. The commitment fee for the unused amount is accrued daily and paid quarterly.

The Short-Term Bond Fund did not utilize the SCA during the six months ended July 31, 2012.

Note 8. New Accounting Pronouncements

In December 2011, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2011-11 regarding “Disclosures about Offsetting Assets and Liabilities”. The amendments, which will be effective for annual reporting periods beginning on or after January 1, 2013 and interim periods within those annual periods, require an entity to disclose information about offsetting and related arrangements for assets and liabilities, financial instruments and derivatives that are either currently offset in accordance with current requirements or are subject to enforceable master netting arrangements or similar agreements. At this time, management is evaluating the implications of ASU No. 2011-11 and its impact on the financial statements has not yet been determined.

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Financial Highlights

(Unaudited)

Prudential Core Taxable Money Market Fund
	Six Months Ended July 31,			Year Ended January 31,
	2012			2012			2011			2010			2009			2008
Per Share Operating Performance:
Net Asset Value, Beginning Of Period		$1.00			$1.00			$1.00			$1.00			$1.00			$1.00
Net investment income and net realized gains		-	(b)		-	(b)		-	(b)		.01			.03			.05
Dividends and distributions to shareholders		-	(b)		-	(b)		-	(b)		(.01	)		(.03	)		(.05	)
Net asset value, end of period		$1.00			$1.00			$1.00			$1.00			$1.00			$1.00
Total Return(a):		.11%			.20%			.27%			.50%			2.61%			5.43%
Ratios/Supplemental Data:
Net assets, end of period (000)		$33,559,676			$31,319,289			$20,569,201			$17,526,308			$15,359,279			$24,536,580
Average net assets (000)		$33,013,852			$27,404,748			$20,000,768			$16,683,486			$22,364,588			$20,733,978
Ratios to average net assets:
Expenses		.01%	(c)		.01%			.01%			.01%			.01%			.01%
Net investment income		.22%	(c)		.19%			.27%			.48%			2.66%			5.29%

(a) Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized.

(b) Less than $.005 per share.

(c) Annualized.

See Notes to Financial Statements.

Prudential Investment Portfolios 2 53

Financial Highlights

(Unaudited) continued

Prudential Core Short-Term Bond Fund
	Six Months Ended July 31,			Year Ended January 31,
	2012			2012			2011			2010			2009			2008
Per Share Operating Performance:
Net Asset Value, Beginning Of Period		$8.90			$9.01			$8.69			$7.40			$9.32			$10.01
Income (loss) from investment operations:
Net investment income		.08			.15			.15			.17			.33			.55
Net realized and unrealized gain (loss) on investment transactions		.12			(.14	)		.29			1.25			(1.93	)		(.69	)
Total from investment operations		.20			.01			.44			1.42			(1.60	)		(.14	)
Less Dividends
Dividends from net investment income		(.06	)		(.12	)		(.12	)		(.13	)		(.32	)		(.55	)
Net asset value, end of period		$9.04			$8.90			$9.01			$8.69			$7.40			$9.32
Total Return(a):		2.28%			.12%			5.10%			19.41%			(17.57)%			(1.48)%
Ratios/Supplemental Data:
Net assets, end of period (000)		$3,596,180			$3,540,330			$3,638,765			$3,500,360			$2,938,484			$3,660,970
Average net assets (000)		$3,573,448			$3,598,740			$3,570,455			$3,189,152			$3,367,022			$3,711,731
Ratios to average net assets(c):
Expenses		.03%	(d)		.03%			.03%			.03%			.02%			.02%	(b)
Net investment income		1.75%	(d)		1.62%			1.73%			2.12%			3.85%			5.63%	(b)
Portfolio turnover rate		28%	(e)		31%			43%			39%			28%			53%

(a) Total return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported, and includes reinvestment of dividends. Total returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods less than one full year are not annualized.

(b) The Manager reimbursed the Fund an amount, such that the expenses (excluding interest, taxes and brokerage commissions) did not exceed .035% of the average daily net assets. If the Manager had not reimbursed the Fund, the expenses and the net investment income ratios would have been .06% and 5.60%, respectively, for the year ended January 31, 2008.

(c) Does not include expenses of the underlying portfolio in which the Fund invests.

(d) Annualized.

(e) Not annualized.

See Notes to Financial Statements.

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Approval of Advisory Agreements (Unaudited)

The Board of Trustees

The Board of Trustees (the “Board”) of Prudential Core Short-Term Bond Fund and Prudential Core Taxable Money Market Fund¹ (each, a “Fund,” and collectively, the “Funds”) consists of ten individuals, eight of whom are not “interested persons” of the Funds, as defined in the Investment Company Act of 1940, as amended (the “1940 Act”) (the “Independent Trustees”). The Board is responsible for the oversight of the Funds and their operations, and performs the various duties imposed on the directors of investment companies by the 1940 Act. The Independent Trustees have retained independent legal counsel to assist them in connection with their duties. The Chair of the Board is an Independent Trustee. The Board has established three standing committees: the Audit Committee, the Nominating and Governance Committee, and the Investment Committee. Each committee is chaired by, and composed of, Independent Trustees.

Annual Approval of the Funds’ Advisory Agreements

As required under the 1940 Act, the Board determines annually whether to renew each Fund’s management agreement with Prudential Investments LLC (“PI”) and each Fund’s subadvisory agreement with Prudential Investment Management, Inc. (“PIM”). In considering the renewal of the agreements, the Board, including all of the Independent Trustees, met on June 5-7, 2012 and approved the renewal of the agreements through July 31, 2013, after concluding that the renewal of the agreements was in the best interests of each Fund and its shareholders.

In advance of the meeting, the Board requested and received materials relating to the agreements, and had the opportunity to ask questions and request further information in connection with their consideration. Among other things, the Board considered comparative fee information from PI and PIM. Also, the Board considered comparisons with other mutual funds in relevant Peer Universes and Peer Groups, as is further discussed below.

In approving the agreements, the Board, including the Independent Trustees advised by independent legal counsel, considered the factors it deemed relevant, including the nature, quality and extent of services provided by PI and the subadviser, the performance of each Fund, the profitability of PI and its affiliates, expenses and fees, and the potential for economies of scale that may be shared with each Fund and its shareholders as each Fund’s assets grow. In their deliberations, the Trustees did not identify any single factor which alone was responsible for the Board’s decision to approve the agreements with respect to the Funds. In connection with its

¹  Prudential Core Short-Term Bond Fund and Prudential Core Taxable Money Market Fund are both series of Prudential Investment Portfolios 2.

Prudential Investment Portfolios 2

Approval of Advisory Agreements (continued)

deliberations, the Board considered information provided by PI throughout the year at regular Board meetings, presentations from portfolio managers and other information, as well as information furnished at or in advance of the meetings on June 5-7, 2012.

The Trustees determined that the overall arrangements between the Funds and PI, which serves as the Funds’ investment manager pursuant to a management agreement, and between PI and PIM, which serves as each Fund’s subadviser pursuant to the terms of a subadvisory agreement with PI, are in the best interests of each Fund and its shareholders in light of the services performed, fees charged and such other matters as the Trustees considered relevant in the exercise of their business judgment.

The material factors and conclusions that formed the basis for the Trustees’ reaching their determinations to approve the continuance of the agreements are separately discussed below.

Nature, quality and extent of services

The Board received and considered information regarding the nature, quality and extent of services provided to each Fund by PI and PIM. The Board considered the services provided by PI, including but not limited to the oversight of the subadvisers for the Funds, as well as the provision of fund recordkeeping, compliance, and other services to each Fund. With respect to PI’s oversight of the subadviser, the Board noted that PI’s Strategic Investment Research Group (“SIRG”), which is a business unit of PI, is responsible for monitoring and reporting to PI’s senior management on the performance and operations of the subadviser. The Board also considered that PI pays the salaries of all of the officers and non-independent Trustees of the Funds. The Board also considered the investment subadvisory services provided by PIM, which it noted had been selected by PI, as well as adherence to the Funds’ investment restrictions and compliance with applicable Fund policies and procedures. The Board considered PI’s evaluation of the subadviser, as well as PI’s recommendation, based on its review of the subadviser, to renew the subadvisory agreements.

The Board reviewed the qualifications, backgrounds and responsibilities of PI’s senior management responsible for the oversight of each Fund and PIM, and also reviewed the qualifications, backgrounds and responsibilities of PIM’s portfolio managers who are responsible for the day-to-day management of each Fund’s portfolio. The Board was provided with information pertaining to PI’s and PIM’s organizational structure, senior management, investment operations, and other relevant information pertaining to both PI and PIM. The Board also noted that it received favorable compliance reports from the Trust’s Chief Compliance Officer (“CCO”) as to both PI and PIM. The Board noted that PIM is affiliated with PI.

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The Board concluded that it was satisfied with the nature, extent and quality of the investment management services provided by PI and the subadvisory services provided to the Funds by PIM, and that there was a reasonable basis on which to conclude that each Fund benefits from the services provided by PI and PIM under the management and subadvisory agreements.

Costs of Services and Profits Realized by PI

The Board was provided with information on the profitability of PI and its affiliates in serving as the Funds’ investment manager. The Board discussed with PI the methodology utilized in assembling the information regarding profitability and considered its reasonableness. The Board recognized that it is difficult to make comparisons of profitability from fund management contracts because comparative information is not generally publicly available and is affected by numerous factors, including the structure of the particular adviser, the types of funds it manages, its business mix, numerous assumptions regarding allocations and the adviser’s capital structure and cost of capital. However, the Board considered that the cost of services provided by PI to the Funds during the year ended December 31, 2011 exceeded the benefits gained by PI, resulting in an operating loss to PI. The Board did not separately consider the profitability of the subadviser, an affiliate of PI, as its profitability was reflected in the profitability report for PI. Taking these factors into account, the Board concluded that the profitability of PI and its affiliates in relation to the services rendered was not unreasonable.

Economies of Scale

The Board noted that the Funds do not have a traditional management structure, because they are operated at cost. Accordingly, the Board determined that the Funds, which have extremely low expenses, benefit directly from any cost savings experienced by PI.

Other Benefits to PI and PIM

The Board considered potential ancillary benefits that might be received by PI and PIM and their affiliates as a result of their relationship with the Funds. The Board concluded that potential benefits to be derived by PI included fees received by affiliates of PI for serving as the Funds’ securities lending agent, transfer agency fees received by the Funds’ transfer agent (which is affiliated with PI), and benefits to its reputation as well as other intangible benefits resulting from PI’s association with the Funds. The Board concluded that the potential benefits to be derived by PIM included its ability to use soft dollar credits, as well as the potential benefits consistent with those generally resulting from an increase in assets under management, specifically, potential access to additional research resources and benefits to its reputation. The Board concluded that the benefits derived by PI and PIM were consistent with the types of benefits generally derived by investment managers and subadvisers to mutual funds.

Prudential Investment Portfolios 2

Approval of Advisory Agreements (continued)

Performance of the Funds / Fees and Expenses

The Board considered certain additional specific factors and made related conclusions relating to the historical performance of the Funds for the one-, three- and five-year periods (and for Prudential Core Taxable Money Market Fund, the ten-year period) ended December 31, 2011. With respect to the fees and expenses of each Fund, because each Fund is operated at cost, the Board did not consider fees and expenses as a meaningful factor for its deliberations.

The mutual funds included in each Fund’s Peer Universe (the Lipper Institutional Money Market Funds Performance Universe for Prudential Core Taxable Money Market Fund, and the Lipper Ultra-Short Obligation Funds Performance Universe² for Prudential Core Short-Term Bond Fund) and the Peer Groups were objectively determined by Lipper Inc. (“Lipper”), an independent provider of mutual fund data. To the extent that PI deemed appropriate, and for reasons addressed in detail with the Board, PI may have provided supplemental data compiled by Lipper for the Board’s consideration. The comparisons placed each Fund in various quartiles, with the first quartile being the best 25% of the mutual funds (for performance, the best performing mutual funds and, for expenses, the lowest cost mutual funds).

The section below summarizes key factors considered by the Board and the Board’s conclusions regarding each Fund’s performance. The table sets forth gross performance comparisons (which do not reflect the impact on performance of fund expenses, or any subsidies, expense caps or waivers that may be applicable) with the Peer Universe, actual management fees with the Peer Group (which reflect the impact of any subsidies or fee waivers), and net total expenses with the Peer Group, each of which were key factors considered by the Board.

Performance:	1 Year	3 Years	5 Years	10 Years
Prudential Core Taxable Money Market Fund	4th Quartile	4th Quartile	3rd Quartile	3rd Quartile
Actual Management Fees: 1st Quartile
Net Total Expenses: 1st Quartile

• The Board noted that although the Fund’s gross performance in relation to its Peer Universe was in the fourth or third quartiles, it further noted that the Fund’s net performance (which reflects the impact of Fund fees and subsidies) in relation to the Peer Universe was in the first quartile over all periods.

²  Although Lipper classifies the Fund in its Short Investment Grade Debt Performance Universe, the Ultra-Short Obligation Funds Performance Universe was utilized because PI believes that the funds included in this Universe provide a more appropriate basis for performance comparisons.

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• The Board concluded that, in light of the Fund’s competitive net performance against its Peer Universe, it would be in the best interests of the Fund and its shareholders to renew the agreements.

Performance:	1 Year	3 Years	5 Years	10 Years
Prudential Core Short-Term Bond Fund	4th Quartile	1st Quartile	4th Quartile	N/A
Actual Management Fees: 1st Quartile
Net Total Expenses: 1st Quartile

• The Board noted that the Fund outperformed its benchmark index over the three-year period, although it underperformed over the one- and five-year periods.

• The Board noted PI’s assertion that the underperformance over the one-year period was the result of the very short durations of the securities held by the Fund as well as market volatility attributable to concerns with respect to the European banking system.

• The Board concluded that, in light of the Fund’s strong performance over longer time periods, it would be in the best interests of the Fund and its shareholders to renew the agreements.

*     *     *

After full consideration of these factors, the Board concluded that the approval of the agreements was in the best interests of each Fund and its shareholders.

Prudential Investment Portfolios 2

Item 2 –	Code of Ethics – Not required, as this is not an annual filing.
Item 3 –	Audit Committee Financial Expert – Not required, as this is not an annual filing.
Item 4 –	Principal Accountant Fees and Services – Not required, as this is not an annual filing.
Item 5 –	Audit Committee of Listed Registrants – Not applicable.
Item 6 –	Schedule of Investments – The schedule is included as part of the report to shareholders filed under Item 1 of this Form.
Item 7 –	Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies – Not applicable.
Item 8 –	Portfolio Managers of Closed-End Management Investment Companies – Not applicable.
Item 9 –	Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers – Not applicable.
Item 10 –	Submission of Matters to a Vote of Security Holders – Not applicable.
Item 11 –	Controls and Procedures
	(a)	It is the conclusion of the registrant’s principal executive officer and principal financial officer that the effectiveness of the registrant’s current disclosure controls and procedures (such disclosure controls and procedures having been evaluated within 90 days of the date of this filing) provide reasonable assurance that the information required to be disclosed by the registrant has been recorded, processed, summarized and reported within the time period specified in the Commission’s rules and forms and that the information required to be disclosed by the registrant has been accumulated and communicated to the registrant’s principal executive officer and principal financial officer in order to allow timely decisions regarding required disclosure.
	(b)	There has been no significant change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter of the period covered by this report that has materially affected, or is likely to materially affect, the registrant’s internal control over financial reporting.
Item 12 –	Exhibits
	(a)	(1)	Code of Ethics – Not required, as this is not an annual filing.
		(2)	Certifications pursuant to Section 302 of the Sarbanes-Oxley Act – Attached hereto as Exhibit EX-99.CERT.
		(3)	Any written solicitation to purchase securities under Rule 23c-1. – Not applicable.
	(b)	Certifications pursuant to Section 906 of the Sarbanes-Oxley Act – Attached hereto as Exhibit EX-99.906CERT.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Registrant	Prudential Investment Portfolios 2
By:	/s/ Deborah A. Docs
	Deborah A. Docs
	Secretary
Date:	September 24, 2012

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By:	/s/ Stuart S. Parker
	Stuart S. Parker
	President and Principal Executive Officer
Date:	September 24, 2012
By:	/s/ Grace C. Torres
	Grace C. Torres
	Treasurer and Principal Financial Officer
Date:	September 24, 2012