Morgan Stanley Tax Exempt Securities Trust N-CSR Certified 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: 811-02979

Morgan Stanley Tax-Exempt Securities Trust
               (Exact name of registrant as specified in charter)

1221 Avenue of the Americas, New York, New York 10020
       (Address of principal executive offices)                  (Zip code)

Ronald E. Robison
1221 Avenue of the Americas, New York, New York 10020
                     (Name and address of agent for service)

Registrant's telephone number, including area code: 212-762-4000

Date of fiscal year end: December 31, 2003

Date of reporting period: June 30, 2003

Item 1 - Report to Stockholders

Welcome, Shareholder:

In this report, you'll learn about how your investment in Morgan Stanley Tax-Exempt Securities Trust performed during the semiannual period. The portfolio management team will provide an overview of the market climate, and discuss some of the factors that helped or hindered performance during the reporting period. In addition, this report includes the Fund's financial statements and a list of Fund investments, as well as other information.

This material must be preceded or accompanied by a prospectus for the fund being offered. Market forecasts provided in this report may not necessarily come to pass. There is no assurance that the Fund will achieve its investment objective. The Fund is subject to market risk. which is the possibility that the market values of securities owned by the Fund will decline and, therefore, the value of the Fund shares may be less than what you paid for them. Accordingly, you can lose money investing in this Fund.

	Fund Report
	For the six-month period ended June 30, 2003

Total Return for the Six Months Ended June 30, 2003

Class A						Class B						Class C						Class D						Lehman Brothers Municipal Bond Index1						Lipper General Municipal Debt Funds Index2
3.77%							3.55	%					3.50	%					3.77	%					3.81	%					3.52	%

The performance of the Fund's four share classes varies because each has different expenses. The Fund's total return figures assume the reinvestment of all distributions, but do not reflect the deduction of any applicable sales charges. Such costs would lower performance. Past performance is no guarantee of future results. See Performance Summary for standardized performance information.

Market Conditions

The six-month period ended June 30, 2003 was a favorable time for the fixed-income markets. The U.S. economy continued to recover but at a slow pace. This led to investor concern that reaching the economy's full growth potential would be delayed. The Federal Reserve Board shared this concern and cut the federal funds rate in June. The reduction in the short-term borrowing rate was felt across the yield curve and drove yields down to levels not seen in decades.

Several factors caused the rally in municipal bonds to lag Treasuries. First, states and municipalities sold a record amount of debt to meet cash flow needs and refinance higher cost issues. Municipal yields also adjusted to federal tax legislation, which included acceleration of scheduled tax bracket reductions and a lower tax on dividends. Finally, the yields of some credits were affected by their potential budget deficits. These factors caused the municipal market to establish yield levels that attracted interest from crossover investors such as insurance companies and hedge funds seeking value relative to taxable bonds.

Performance Analysis

The Fund's more conservative portfolio structure underperformed the Lehman Brothers Municipal Bond Index. With rates at historically low levels, the market appeared to be anticipating a prolonged, weak economic recovery. This assessment seemed unduly pessimistic in light of monetary and fiscal policies seeking to stimulate growth. Since this stimulus should eventually result in stronger economic growth and higher interest rates, we maintained the Fund's shorter-than-average duration.

We sought to preserve shareholder value by maintaining a high-grade portfolio with over 85 percent of long-term holdings rated either double- or -triple "A". The portfolio is structured with a greater-than-average weighting of premium coupon bonds. These bonds are somewhat more defensive than current-coupon (par) bonds in a rising-rate environment. The Fund benefited by offering securities with less favorable structure for sale to take advantage of demand for bonds with specific state exemptions.

2

Purchases at the sector level focused on high-grade revenue bonds backed by electric, transportation and water & sewer projects. The Fund has maintained a cautious stance toward the general obligation sector because a number of issuers under budgetary stress face potential credit rating downgrades. The Fund also benefited by our decision to avoid tobacco bonds.

LONG-TERM CREDIT ANALYSIS
Aaa/AAA					71	%
Aa/AA					16
A/A					5
Baa/BBB					4
Ba/BB or Less					1
Not rated					3

LONG-TERM SECTORS
Transportation					20	%
Prerefunded					14
Electric					14
General Obligation					13
Water & Sewer					10

Subject to change daily. All percentages are as a percentage of long-term investments. Provided for informational purposes only and should not be deemed as a recommendation to buy the securities mentioned. Morgan Stanley is a full-service securities firm engaged in securities trading and brokerage activities, investment banking, research and analysis, financing and financial advisory services.

Investment Strategy

	1.	The Fund seeks to provide a high level of current income exempt from federal income tax, consistent with the preservation of capital. The Fund invests principally in long-term municipal obligations, 75 percent of which are rated within the three highest grades by Moody's, Standard & Poor's or Fitch IBCA.

	2.	The portfolio management team seeks to diversify credit and interest-rate risk by investing in a mix of sectors and individual issues that have a variety of coupons, maturities, call features and durations.

3

	Call and Cost (Book) Yield Structure

Percent of Bonds Callable—Weighted Average Call Protection: 7 Years

(Based on Long-Term Portfolio) As of 6/30/03

Cost (Book) Yield^(b)—Weighted Average Book Yield: 5.6%

(Based on Long-Term Portfolio) As of 6/30/03

(a) Includes issues callable in previous years.

(b) Cost or book yield is the annual income earned on a portfolio investment based on its original purchase price before the Fund's operating expenses. For example, the Fund is earning a book yield of 7.6% on 10% of the long-term portfolio that is callable in 2003. Portfolio structure is subject to change.

4

	Performance Summary

Average Annual Total Returns—Period Ended June 30, 2003

				Class A Shares* (since 03/27/80)				Class B Shares** (since 07/28/97)				Class C Shares† (since 07/28/97)				Class D Shares†† (since 03/27/80)
Symbol				TAXAX				TAXBX				TAXCX				TAXDX
1 Year					8.68%	3			8.16%	3			8.05%	3			8.83%	3
					4.06%	4			3.16%	4			7.05%	4
5 Years					5.63%	3			5.20%	3			5.09%	3			5.83%	3
					4.72%	4			4.87%	4			5.09%	4
10 Years					5.64%	3											5.87%	3
					5.19%	4
Since Inception					8.44%	3			5.37%	3			5.22%	3			8.69%	3
					8.24%	4			5.24%	4			5.22%	4

Prior to July 28, 1997 the Fund offered only one class of shares. Because the distribution arrangement for Class A most closely resembled the distribution arrangement applicable prior to the implementation of multiple classes (i.e., Class A is sold with a front-end sales charge), historical performance information has been restated to reflect the actual maximum sales charge applicable to Class A (i.e., 4.25%) as compared to the 4.00% sales charge in effect prior to July 28, 1997. In addition, Class A shares are now subject to an ongoing 12b-1 fee which is reflected in the restated performance for that class.

Because all shares of the fund held prior to July 28, 1997 were designated Class D shares, the Fund's historical performance has been restated to reflect the absence of any sales charge.

Past performance is not predictive of future returns. Investment return and principal value will fluctuate. When you sell fund shares, they may be worth less than their original cost. The table does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Performance for Class A, Class B, Class C, and Class D shares will vary due to differences in sales charges and expenses.

Notes on Performance

(1) The Lehman Brothers Municipal Bond Index tracks the performance of municipal bonds rated at least Baa or BBB by Moody's Investors Service, Inc. or Standard & Poor's Corporation, respectively and with maturities of 2 years or greater. Indexes are unmanaged and their returns do not include any expenses, sales charges or fees. Such costs would lower performance. It is not possible to invest directly in an index.

(2) The Lipper General Municipal Debt Funds Index is an equally weighted performance index of the largest qualifying funds (based on net assets) in the Lipper General Municipal Debt Funds classification. The Index is adjusted for capital gains distributions and income dividends. There are currently 30 funds represented in this Index. Indexes are unmanaged and their returns do not include any sales charges or fees. Such costs would lower performance. It is not possible to invest directly in an index.

(3) Figure shown assumes reinvestment of all distributions and does not reflect the deduction of any sales charges.

(4) Figure shown assumes reinvestment of all distributions and the deduction of the maximum applicable sales charge. See the Fund's current prospectus for complete details on fees and sales charges.

* The maximum front-end sales charge for Class A is 4.25%.

** The maximum contingent deferred sales charge (CDSC) for Class B is 5.0%. The CDSC declines to 0% after six years.

† The maximum CDSC for Class C is 1.0% for shares redeemed within one year of purchase.

†† Class D has no sales charge.

5

Morgan Stanley Tax-Exempt Securities Trust

Portfolio of Investments June 30, 2003 (unaudited)

PRINCIPAL AMOUNT IN THOUSANDS								COUPON RATE				MATURITY DATE				VALUE
				Tax-Exempt Municipal Bonds (94.4%)
				General Obligation (12.2%)
				North Slope Borough, Alaska,
$	15,000			Ser 1995 A (MBIA)					0.00	%			06/30/06			$	14,210,700
	4,000			Ser 2000 B (MBIA)					0.00				06/30/09				3,353,480
	9,500			Ser 1999 A (MBIA)					0.00				06/30/10				7,556,870
	25,000			Ser 2000 B (MBIA)					0.00				06/30/11				18,821,750
	20,000			Ser 2001 A (MBIA)					0.00				06/30/12				14,303,000
	5,000			California, Various Purpose dtd 04/01/02					6.00				04/01/19				5,820,900
	2,000			Los Angeles Unified School District, California, 1997 Ser B (FGIC)					5.00				07/01/23				2,075,840
				Connecticut,
	4,000			College Savings 1989 Ser A					0.00				07/01/08				3,530,720
	5,000			Refg 2002 Ser E Ser PA 1056 B RITES (FSA)					9.807	‡			11/15/11				6,808,900
	15,000			Refg 2002 Ser E Ser PA 1056 A RITES (FSA)					9.807	‡			11/15/13				20,318,100
	5,000			Florida Board of Education, Capital Outlay Refg 2002 Ser C (MBIA)					5.00				06/01/20				5,355,150
				Chicago, Illinois,
	5,000			Refg Ser 1995 A-2 (Ambac)					6.25				01/01/14				6,189,850
	2,000			Refg 2001 A (MBIA)					0.00	#			01/01/17				1,539,960
	10,300			Neighborhoods Alive 21 (FGIC)					5.375				01/01/26				10,991,748
				Chicago Board of Education, Illinois
	1,000			Ser 2001 C (FSA)					5.50				12/01/18				1,116,210
	3,000			Ser 2001 C (FSA)					5.00				12/01/26				3,108,300
	3,000			Clark County, Nevada, Transportation Ser 1992 A (Ambac)					6.50				06/01/17				3,839,100
				New York City, New York,
	1,510			1990 Ser D					6.00				08/01/07				1,515,376
	915			1990 Ser D					6.00				08/01/08				918,257
	5,000			New York State, Refg Ser 1995 B					5.70				08/15/10				5,466,550
	10,000			North Carolina, Public School Building Ser 1999					4.60				04/01/17				10,538,500
	500			Delaware City School District, Ohio, Constr & Impr (FGIC)					5.75				12/01/20				546,955
	1,000			Little Miami Local School District, Ohio, Ser 1998 (FGIC)					4.875				12/01/23				1,026,840
	10,000			South-Western City School District, Ohio, Ser 1999 (Ambac)					4.75				12/01/19				10,334,800
				Pennsylvania,
	5,000			RITES Ser PA – 1112 A (MBIA)					8.777	‡			01/01/18				5,841,700
	5,000			RITES Ser PA – 1112 B (MBIA)					8.777	‡			01/01/19				5,767,700
				Shelby County, Tennessee,
	5,000			Refg 1995 Ser A					5.625				04/01/11				5,401,350
	1,000			Refg 1995 Ser A					5.625				04/01/12				1,080,270
	4,000			Refg 1995 Ser A					5.625				04/01/14				4,293,520
	5,000			North East Texas Independent School District, Texas, Ser 1999 (PSF)					6.50				10/01/14				6,015,950
	187,725																187,688,346

See Notes to Financial Statements

6

Morgan Stanley Tax-Exempt Securities Trust

Portfolio of Investments June 30, 2003 (unaudited) continued

PRINCIPAL AMOUNT IN THOUSANDS								COUPON RATE				MATURITY DATE				VALUE
				Educational Facilities Revenue (3.1%)
$	4,000			California Public Works Board, University of California 1993 Refg Ser A					5.50	%			06/01/21			$	4,089,760
	1,000			University of Idaho, Student Fee Ser H (FGIC)					5.25				04/01/31				1,058,620
	7,000			Indiana University, Student Fee Ser K (MBIA)					5.875				08/01/20				7,668,990
	1,000			Purdue University, Indiana, Student Fee Ser Q					5.75				07/01/15				1,150,720
	2,000			Maryland Health & Educational Facilities Authority, The Johns Hopkins University Refg Ser 1998					5.125				07/01/20				2,144,960
	400			Massachusetts Industrial Finance Agency, College of the Holy Cross 1996 Issue (MBIA)					5.50				03/01/16				441,352
	500			Oakland University, Michigan, Ser 1995 (MBIA)					5.75				05/15/26				540,655
	7,000			New Jersey Educational Facilities Authority, Princeton University Ser 1999 A					4.75				07/01/25				7,120,610
				New York State Dormitory Authority,
	5,000			City University Ser 2000 A (Ambac)					6.125				07/01/13				5,958,000
	2,000			State University 1990 Ser A					7.50				05/15/13				2,666,940
	5,000			State University 1993 Ser A					5.25				05/15/15				5,744,300
				Ohio State University,
	1,500			General Receipts Ser 2002 A					5.00				12/01/26				1,569,915
	2,500			General Receipts Ser 1999 A					5.80				12/01/29				2,832,875
	4,000			Delaware County Authority, Pennsylvania, Villanova University Ser 1995 (Ambac)					5.70				08/01/15				4,388,000
	42,900																47,375,697
				Electric Revenue (13.3%)
				Salt River Project Agricultural Improvement & Power District, Arizona,
	25,000			Refg 1993 Ser C (Secondary MBIA)					5.50				01/01/10				28,891,000
	4,000			Refg 2002 Ser A					5.25				01/01/13				4,601,280
	1,500			Refg 2002 Ser A					5.25				01/01/19				1,647,015
	1,635			Sacramento Municipal Utility District, California, Refg 1994 Ser I (MBIA)					5.75				01/01/15				1,700,008
	9,000			Southern California Public Power Authority, Mead-Adelanto 1994 A (Ambac)					8.67	‡			07/01/15				11,250,720
	15,000			Colorado Springs, Colorado, Utilities Refg Ser 2002 (Ambac)					5.375				11/15/20				16,487,700
	9,550			Municipal Electric Authority of Georgia, Ser Y (Secondary MBIA)					6.50				01/01/17				12,063,465
	5,000			Southern Minnesota Municipal Power Agency, Ser 2002 A (Ambac)					5.25				01/01/16				5,775,600
	15,000			Long Island Power Authority, New York, Ser 2000 A (FSA)					0.00				06/01/17				8,251,650
				North Carolina Municipal Power Agency,
	5,000			Catawba Ser 1998 A (MBIA)					5.50				01/01/15				5,857,400
	4,000			Catawba Ser 2003 A (MBIA)					5.25				01/01/19				4,365,600

See Notes to Financial Statements

7

Morgan Stanley Tax-Exempt Securities Trust

Portfolio of Investments June 30, 2003 (unaudited) continued

PRINCIPAL AMOUNT IN THOUSANDS								COUPON RATE				MATURITY DATE				VALUE
				Puerto Rico Electric Power Authority,
$	15,000			Power Ser O					0.00	%			07/01/17			$	8,065,950
	5,000			Power Ser EE (MBIA)					4.50				07/01/18				5,160,650
				South Carolina Public Service Authority,
	10,000			1996 Refg Ser A (MBIA)					5.75				01/01/13				11,177,300
	5,000			2002 Refg Ser D (FSA)					5.00				01/01/21				5,298,700
	15,000			1995 Refg Ser A (Ambac)					6.25				01/01/22				16,747,650
	10,000			2003 Refg Ser A (Ambac)					5.00				01/01/27				10,489,600
	10,500			San Antonio, Texas, Electric & Gas Refg Ser 1994 C					7.98	‡			02/01/06				12,175,800
	15,000			Intermountain Power Agency, Utah, Refg 1997 Ser B (MBIA)					5.75				07/01/19				16,872,000
	3,000			Chelan County Public Utility District #1, Washington, Hydro Ser 1997 A (AMT)					5.60				07/01/32				3,104,280
	5,000			Grant County Public Utility District #2, Washington, Refg Ser 2001 H (FSA)					5.375				01/01/18				5,487,650
	7,330			Seattle Municipal Light & Power, Washington, Impr & Refg Ser 2001 (FSA)					5.50				03/01/18				8,152,206
	3,000			Washington Public Power Supply System, Project #2 Refg Ser 1994 A (FGIC)					0.00				07/01/09				2,500,080
	198,515																206,123,304
				Hospital Revenue (6.3%)
	2,220			Birmingham-Carraway Special Care Facilities Financing Authority, Alabama, Carraway Methodist Health Ser 1995 A (Connie Lee)					5.875				08/15/15				2,409,388
	5,000			Hawaii Department of Budget & Finance, Queen's Health 1996 Ser A					6.00				07/01/20				5,267,050
	5,000			Illinois Health Facilities Authority, Loyola University Health Ser 2001 A					6.00				07/01/21				5,217,600
	10,000			Missouri Health & Educational Facilities Authority, Barnes-Jewish/ Christian Health Ser 1993 A					5.25				05/15/14				11,093,100
	3,000			University of Missouri, Health Ser 1996 A (Ambac)					5.50				11/01/16				3,272,970
				Henderson, Nevada,
	10,065			Catholic Health West 1998 Ser A					5.375				07/01/26				9,422,450
	2,000			Catholic Health West 1998 Ser A					5.125				07/01/28				1,789,080
				New Jersey Health Care Facilities Financing Authority,
	2,000			St Barnabas Health Refg Ser 1998 B (MBIA)					5.25				07/01/18				2,153,280
	6,500			Robert Wood Johnson University Hospital, Ser 2000					5.75				07/01/25				7,068,815
	10,000			New York State Dormitory Authority, Memorial Sloan-Kettering Cancer Center 2003 Ser I					5.00				07/01/34				10,334,800
	6,000			New York State Medical Care Facilities Finance Agency, Presbyterian Hospital – FHA Insured Mtge Ser 1994 A					5.25				08/15/14				6,258,180
				North Carolina Medical Care Commission,
	5,000			Presbyterian Health Services Corp Refg Ser 1993					5.50				10/01/20				5,107,750
	1,050			Pitt County Memorial Hospital Ser 1998 A					4.75				12/01/28				1,030,355

See Notes to Financial Statements

8

Morgan Stanley Tax-Exempt Securities Trust

Portfolio of Investments June 30, 2003 (unaudited) continued

PRINCIPAL AMOUNT IN THOUSANDS								COUPON RATE				MATURITY DATE				VALUE
$	700			Akron, Bath & Copley Joint Township Hospital District, Ohio, Summa Health Ser 1992 A					6.25	%			11/15/07			$	715,253
	3,000			Erie County Hospital Facility, Ohio, Firelands Regional Medical Center Ser 2002					5.625				08/15/32				3,106,350
	5,000			Lorain County, Ohio, Catholic Health Ser 9 2001 A					5.25				10/01/33				5,119,100
	5,000			Lehigh County General Purpose Authority, Pennsylvania, St Luke's Hospital of Bethlehem Ser A 2003 (WI)					5.375				08/15/33				4,847,400
	2,500			Pennsylvania Higher Educational Facilities Authority, University of Pennsylvania Ser A 1996					5.75				01/01/22				2,579,375
	5,000			South Carolina Jobs-Economic Development Authority, Bon Secours Health Ser 2002 A					5.625				11/15/30				5,193,350
	5,000			North Central Texas Health Facilities Development Corporation, University Medical Center Inc Ser 1997 (FSA)					5.45				04/01/15				5,448,600
	94,035																97,434,246
				Industrial Development/Pollution Control Revenue (4.6%)
	1,500			Hawaii Department of Budget & Finance, Hawaii Electric Co Ser 1995 A (AMT) (MBIA)					6.60				01/01/25				1,599,075
	5,000			Wamego, Kansas, Kansas Gas & Electric Co Ser 1991 (MBIA)					7.00				06/01/31				5,257,500
	8,500			Massachusetts Industrial Finance Agency, Eastern Edison Co Refg Ser 1993					5.875				08/01/08				8,692,780
	2,475			Lapeer Economic Development Corporation, Michigan, Dott Manufacturing Co Ser 1989 A (AMT)					10.65				11/15/17				1,525,219
				Michigan Strategic Fund,
	1,000			Ford Motor Co Refg Ser 1991 A					7.10				02/01/06				1,066,780
	10,000			Detroit Edison Co Ser 1999 B (AMT)					5.65				09/01/29				10,312,400
	300			Bass Brook, Minnesota, Minnesota Power & Light Co Refg Ser 1992					6.00				07/01/22				303,339
				New Jersey Economic Development Authority,
	6,000			Continental Airlines Inc Ser 1999 (AMT)					6.625				09/15/12				5,325,420
	4,000			Continental Airlines Inc Ser 1999 (AMT)					6.25				09/15/19				3,290,320
	2,500			Ohio Water Development Authority, Dayton Power & Light Co Collateralized Refg 1992 Ser A					6.40				08/15/27				2,541,600
	5,000			Brazos River Authority, Texas, TXU Electric Co Refg Ser 1999 C (AMT)					7.70				03/01/32				5,575,450
	8,000			Dallas-Fort Worth International Airport Facility Improvement Corporation, Texas, American Airlines Inc Ser 1995					6.00				11/01/14				4,321,520
	10,000			Sabine River Authority, Texas, TXU Electric Co Refg Ser 2001 B (AMT)					5.75				05/01/30				10,481,100
	10,000			Weston, Wisconsin, Wisconsin Public Service Co Refg Ser 1993 A					6.90				02/01/13				10,339,700
	74,275																70,632,203

See Notes to Financial Statements

9

Morgan Stanley Tax-Exempt Securities Trust

Portfolio of Investments June 30, 2003 (unaudited) continued

PRINCIPAL AMOUNT IN THOUSANDS								COUPON RATE				MATURITY DATE				VALUE
				Mortgage Revenue – Multi-Family (0.9%)
$	1,320			Massachussetts Housing Finance Agency, Rental 1994 Ser A (AMT) (Ambac)					6.60	%			07/01/14			$	1,369,619
	5,000			New Jersey Housing Agency, 1995 Ser A (Ambac)					6.00				11/01/14				5,247,050
				New York City Housing Development Corporation, New York,
	3,876			Ruppert Project – FHA Ins Sec 223F					6.50				11/15/18				4,074,989
	3,723			Stevenson Commons Project – FHA Ins Sec 223F					6.50				05/15/18				3,914,120
	13,919																14,605,778
				Mortgage Revenue – Single Family (4.3%)
				Alaska Housing Finance Corporation,
	2,000			Governmental 1995 Ser A (MBIA)					5.875				12/01/24				2,071,340
	15,000			1997 Ser A (MBIA)					6.00				06/01/27				15,381,450
	2,440			California Housing Finance Agency, Home 1983 Ser B					0.00				08/01/15				901,531
				Colorado Housing & Finance Authority,
	605			1997 Ser B-2 (AMT)					7.00				05/01/26				613,621
	930			1998 Ser A-2 (AMT)					6.60				05/01/28				977,644
	860			1997 Ser C-2 (AMT)					6.875				11/01/28				871,971
	2,695			Connecticut Housing Finance Authority, 2000 Subser B-2 (AMT)					5.85				05/15/31				2,823,039
	6,240			Hawaii Housing Finance & Development Corporation, Purchase 1997 Ser A (AMT)					5.75				07/01/30				6,460,522
	100			Idaho Housing Agency, Ser 1988 D-2 (AMT)					8.25				01/01/20				108,564
				Chicago, Illinois,
	585			GNMA-Backed Ser 1997 B (AMT)					6.95				09/01/28				604,053
	525			GNMA-Backed Ser 1997 A (AMT)					7.25				09/01/28				538,713
	110			Olathe, Kansas, GNMA Collateralized Ser 1989 A (AMT) (MBIA)					8.00				11/01/20				110,128
	20			Saint Tammany Public Trust Finance Authority, Louisiana, Refg Ser 1990 B					7.25				07/25/11				20,497
	120			Massachusetts Housing Finance Agency, Housing Ser 21 (AMT)					7.125				06/01/25				121,321
	155			Minnesota Housing Finance Agency, Ser 1992 H (AMT)					6.50				01/01/26				158,267
				Missouri Housing Development Commission,
	1,115			Homeownership 1996 Ser C (AMT)					7.45				09/01/27				1,173,092
	645			Homeownership 1997 Ser A-2 ( AMT)					7.30				03/01/28				672,400
	1,710			Homeownership 1997 Ser C-1					6.55				09/01/28				1,820,210
	245			Homeownership 1998 Ser B-2 (AMT)					6.40				03/01/29				255,278
	1,035			Homeownership Ser 2000 B-1 (AMT)					7.45				09/01/31				1,100,008
	3,030			New Hampshire Housing Finance Authority, Mortgage Acquisition 2000 Ser B (AMT)					6.70				07/01/29				3,248,796
	10,570			Ohio Housing Finance Agency, Residential 1996 Ser B-2 (AMT)					6.10				09/01/28				11,131,584
	1,860			Oregon Housing & Community Service Department, Ser 2000 F (AMT)					6.25				07/01/28				1,972,902

See Notes to Financial Statements

10

Morgan Stanley Tax-Exempt Securities Trust

Portfolio of Investments June 30, 2003 (unaudited) continued

PRINCIPAL AMOUNT IN THOUSANDS								COUPON RATE				MATURITY DATE				VALUE
				Tennessee Housing Department Agency,
$	3,585			Mortgage Finance 1993 Ser A					5.90	%			07/01/18			$	3,660,393
	580			Mortgage Finance 1994 Ser B (AMT)					6.55				07/01/19				594,233
	8,845			Mortgage Finance 1993 Ser A					5.95				07/01/28				9,028,445
	60			Utah Housing Finance Agency, Fed Ins/Gtd Loans 1994 Issue E (AMT)					6.50				07/01/26				61,103
	65,665																66,481,105
				Nursing & Health Related Facilities Revenue (0.5%)
	910			Marion, Iowa, AHF/Kentucky-Iowa Inc Ser 1990 (a)					10.25				01/01/20				411,993
	1,810			Lexington-Fayette Urban County Government, Kentucky, AHF/Kentucky-Iowa Inc Ser 1990 (a)					10.25				01/01/20				819,459
	500			Minneapolis & Saint Paul Housing & Redevelopment Authority, Minnesota, Group Health Plan Inc Ser 1992					6.75				12/01/13				513,200
	2,000			New York State Dormitory Authority, Mental Health Ser 1999 C (MBIA)					4.75				08/15/22				2,046,140
	1,710			Chester County Industrial Development Authority, Pennsylvania, RHA/PA Nursing Home Inc Ser 1989					8.50				05/01/32				1,730,144
				Kirbyville Health Facilities Development Authority, Texas,
	623			Heartway III Corp Ser 1998 B (b)					6.00				03/20/04				31,088
	3,556			Heartway III Corp Ser 1998 A (b)					10.00				03/20/18				1,772,394
	11,109																7,324,418
				Public Facilities Revenue (2.5%)
	9,000			Arizona School Facilities Board, School Improvement Ser 2001					5.50				07/01/18				10,142,370
	2,000			North City West School Facilities Authority, California, Community District #1 Special Tax Ser 1995 B (FSA)					6.00				09/01/19				2,268,020
	5,000			Denver, Colorado, Civic Center Ser 2000 B COPs (Ambac)					5.50				12/01/25				5,412,350
	1,000			Jacksonville, Florida, Sales Tax Ser 2001 (Ambac)					5.50				10/01/17				1,126,810
	3,495			Illinois, Civic Center Dedicated Tax Ser 1991 (Ambac)					6.25				12/15/20				4,330,060
	4,000			Michigan, 525 Redevco Inc COPs (Ambac)					5.50				06/01/27				4,323,920
				Ohio Building Authority,
	5,000			1985 Ser C					9.75				10/01/05				5,705,300
	5,000			Administrative Building 2001 Ser A (FSA)					5.50				10/01/18				5,606,050
	34,495																38,914,880
				Recreational Facilities Revenue (2.1%)
				Metropolitan Football Stadium District, Colorado,
	4,000			Sales Tax Ser 1999 A (MBIA)					0.00				01/01/10				3,237,280
	3,650			Sales Tax Ser 1999 A (MBIA)					0.00				01/01/11				2,801,010
	2,000			Sales Tax Ser 1999 A (MBIA)					0.00				01/01/12				1,458,260

See Notes to Financial Statements

11

Morgan Stanley Tax-Exempt Securities Trust

Portfolio of Investments June 30, 2003 (unaudited) continued

PRINCIPAL AMOUNT IN THOUSANDS								COUPON RATE				MATURITY DATE				VALUE
$	9,000			Mashantucket Western Pequot Tribe, Connecticut, Special 1997 Ser B (c)					5.75	%			09/01/27			$	9,257,670
	20,000			Metropolitan Pier & Exposition Authority, Illinois, Refg Ser 2002 B (MBIA)					0.00	##			06/15/22				10,943,200
	5,000			Hamilton County, Ohio, Sales Tax Ser 2000 (Ambac)					5.25				12/01/32				5,262,900
	43,650																32,960,320
				Resource Recovery Revenue (0.3%)
	5,000			Northeast Maryland Waste Disposal Authority, Montgomery County Ser 2003 (AMT) (Ambac)					5.50				04/01/16				5,549,250
				Retirement & Life Care Facilities Revenue (0.4%)
				Riverside County Public Financing Authority, California,
	2,000			Air Force Village West Inc COPs					5.75				05/15/19				2,043,380
	3,900			Air Force Village West Inc COPs					5.80				05/15/29				3,949,335
	5,900																5,992,715
				Tax Allocation Revenue (0.3%)
	5,000			Rosemead Redevelopment Agency, California, Project # 1 Ser 1993 A					5.60				10/01/33				5,075,950
				Transportation Facilities Revenue (18.5%)
	4,140			Phoenix, Arizona, Street & Highway Jr Lien Refg Ser 2002 (FGIC)					5.00				07/01/11				4,703,123
	5,000			San Fransisco Bay Area Rapid Transit District, California, Sales Tax Ser 1998 (Ambac)					4.75				07/01/23				5,080,350
	2,500			Colorado Department of Transportation, Refg Ser 2002 B (MBIA)					5.50				06/15/16				2,962,725
				E-470 Public Highway Authority, Colorado,
	15,000			Ser 1997 B (MBIA)					0.00				09/01/14				9,522,300
	5,000			Ser 1997 B (MBIA)					0.00				09/01/16				2,807,050
	10,000			Metropolitan Washington Airport Authority, District of Columbia & Virginia, Ser 2001A (AMT) (MBIA)††					5.50				10/01/27				10,519,500
	8,500			Jacksonville, Florida, Transportation Ser 2001 (MBIA)					5.00				10/01/26				8,843,230
	2,000			Lee County, Florida, Transportation Ser 1995 (MBIA)					5.75				10/01/22				2,195,560
				Mid-Bay Bridge Authority, Florida,
	8,710			Sr Lien Crossover Refg Ser 1993 A (Ambac)					5.85				10/01/13				10,318,998
	3,000			Ser 1997 A (Ambac)					0.00				10/01/21				1,180,830
	5,000			Atlanta, Georgia, Airport Ser 2000 (FGIC)					5.875				01/01/17				5,717,350
	3,460			Hawaii, Airport 2000 Ser B (AMT) (FGIC)					6.625				07/01/17				4,129,821
	6,000			Regional Transportation Authority, Illinois, Refg Ser 1999 (FSA)					5.75				06/01/21				7,179,540
	2,000			Kansas Department of Transportation, Highway Refg Ser 1998					5.50				09/01/14				2,395,760
				Kentucky Turnpike Authority,
	9,000			Economic Development Road Refg Ser 1995 (Ambac)					6.50				07/01/08				10,743,840
	3,500			Resource Recovery Road 1987 Ser A BIGS					8.50				07/01/06				4,193,280
	30,000			Resource Recovery Road 1987 Ser A					5.00				07/01/08				30,090,300

See Notes to Financial Statements

12

Morgan Stanley Tax-Exempt Securities Trust

Portfolio of Investments June 30, 2003 (unaudited) continued

PRINCIPAL AMOUNT IN THOUSANDS								COUPON RATE				MATURITY DATE				VALUE
$	8,800			Massachusetts Turnpike Authority, Western 1997 Ser A (MBIA)					5.55	%			01/01/17			$	9,104,040
	4,140			Missouri Highways & Transportation Commission, Ser A 2001					5.125				02/01/19				4,469,875
	5,000			Nevada Department of Business & Industry, Las Vegas Monorail 1st Tier Ser 2000 (Ambac)					5.375				01/01/40				5,295,700
	30,000			New Jersey Turnpike Authority, Ser 2003 A (Ambac) (WI)					5.00				01/01/30				31,568,100
	6,595			Albuquerque, New Mexico, Airport Refg Ser 1997 (AMT) (Ambac)					6.375				07/01/15				7,567,367
				Metropolitan Transportation Authority, New York,
	1,460			Service Contract Ser 2002 A (MBIA)					5.50				01/01/20				1,614,366
	5,000			Service Contract Ser 2002 B (MBIA)					5.50				07/01/24				5,452,950
	10,000			Transportation Refg Ser 2002 A (Ambac)					5.50				11/15/18				11,329,800
	3,000			Pennsylvania Turnpike Commission, Ser A 1998 (Ambac)					4.75				12/01/27				3,042,960
				Puerto Rico Highway & Transportation Authority,
	10,000			Refg Ser X					5.50				07/01/15				11,418,800
	2,000			Ser 1998 A**					4.75				07/01/38				1,959,860
	10,000			South Carolina Transportation Infrastructure Bank, Ser 1999 A (Ambac)					5.50				10/01/16				11,299,400
	11,000			Austin, Texas, Airport Prior Lien Ser 1995 A (AMT) (MBIA)					6.125				11/15/25				12,045,660
	7,500			Dallas Area Rapid Transit, Texas, Senior Lien Ser 2001 (Ambac)					5.00				12/01/31				7,770,750
				Dallas Fort Worth International Airport, Texas,
	4,000			Refg Ser 1995 (FGIC)					5.625				11/01/15				4,320,640
	10,000			Ser A (AMT) (FSA)					5.25				11/01/24				10,239,700
	5,000			Houston, Texas, Airport Sub Lien Ser 2000 A (AMT) (FSA)					5.875				07/01/17				5,515,650
	15,000			Texas Turnpike Authority, Texas, Ser 2002 A (Ambac)					5.00				08/15/42				15,462,600
	4,000			Pocahontas Parkway Association, Virginia, Route 895 Connector Ser 1998 A					5.50				08/15/28				2,793,320
	275,305																284,855,095
				Water & Sewer Revenue (9.9%)
	2,000			San Francisco Public Utilities Commission, California, Water 1996 Ser A					5.00				11/01/21				2,057,360
	5,000			Lee County, Florida, Water & Sewer 1999 Ser A (Ambac)					4.75				10/01/23				5,098,850
	5,000			Augusta, Georgia, Water & Sewer Ser 2000 (FSA)					5.25				10/01/26				5,255,150
	10,000			Fulton County, Georgia, Water & Sewerage Ser 1998 (FGIC)					4.75				01/01/28				10,145,700
	8,000			Indiana Bond Bank, Revolving Fund Ser 2001A					5.375				02/01/19				8,916,400
	8,000			Indianapolis, Indiana, Industrial Local Public Improvement Bond Bank Water Works Ser 2002 A (MBIA)					5.125				07/01/27				8,430,320
	2,700			Kansas Development Finance Authority, Public Water Supply Ser 2000-2 (Ambac)					5.75				04/01/17				3,100,059
	10,000			Louisville & Jefferson County Metropolitan Sewer District, Kentucky, Ser 1998 A (FGIC)					4.75				05/15/28				10,129,400
	6,000			Boston Water & Commission, Massachusetts 1998 Ser D (FGIC)					4.75				11/01/22				6,104,700
	4,925			Detroit, Michigan, Water Supply Sr Lien Ser 2001 A (FGIC)					5.25				07/01/33				5,218,579

See Notes to Financial Statements

13

Morgan Stanley Tax-Exempt Securities Trust

Portfolio of Investments June 30, 2003 (unaudited) continued

PRINCIPAL AMOUNT IN THOUSANDS								COUPON RATE				MATURITY DATE				VALUE
$	5,000			Truckee Meadows Water Authority, Nevada, Ser 2001 A (FSA)					5.125	%			07/01/30			$	5,225,850
	9,000			Passaic Valley Sewerage Commissioners, New Jersey, Ser F (FGIC)					5.00				12/01/19				9,752,490
	5,000			Cleveland, Ohio, Waterworks Impr & Refg 1998 Ser I (FSA)					5.00				01/01/23				5,170,700
	5,000			Charleston, South Carolina, Refg Cap Impr Ser 1998 (FGIC)					4.50				01/01/24				4,960,300
	5,000			Spartanburg, South Carolina, Jr Lien Water Ser 1998 (FGIC)					5.25				06/01/28				5,396,250
				Metropolitan Government of Nashville & Davidson County, Tennessee,
	2,000			Refg 1986					5.50				01/01/16				2,006,200
	5,000			Refg Ser 1998 A (FGIC)					4.75				01/01/22				5,098,050
	7,100			Austin, Texas, Water & Wastewater Refg Ser 2001 A (FSA)					5.75				05/15/17				8,126,944
	5,000			Houston, Texas, Water & Sewer Jr Lien Refg Ser 2000 B (FGIC)					5.25				12/01/30				5,205,350
				San Antonio, Texas,
	1,000			Water & Refg Ser 2002 (FSA)					5.50				05/15/19				1,115,040
	16,000			Water & Refg Ser 2002 (FSA)					5.00				05/15/28				16,601,760
	5,000			Tarrant Regional Water District, Texas, Water Ser 2002 (FSA)					5.375				03/01/16				5,649,300
	1,300			Wichita Falls, Texas, Water & Sewer 2001 (Ambac)					5.375				08/01/24				1,391,221
	1,000			Loudoun County Sanitation Authority, Virginia, Ser 1998 (MBIA)					4.75				01/01/21				1,022,800
				Seattle, Washington, Water System
	5,000			Ser PA 1143 A RITES (MBIA)					8.728	‡			09/01/20				5,664,600
	5,000			Ser PA 1143 B RITES (MBIA)					8.728	‡			09/01/23				5,495,400
	144,025																152,338,773
				Other Revenue (1.5%)
				New York City Transitional Finance Authority, New York,
	7,000			Refg 2003 Ser D (MBIA)					5.25				02/01/21				7,597,870
	8,000			Refg 2003 Ser A					5.50				11/01/26				9,216,480
	5,000			New York Local Government Assistance Corporation, Ser 1993 C					5.50				04/01/17				5,839,200
	20,000																22,653,550
				Refunded (13.7%)
	4,435			Jefferson County, Alabama, Sewer Ser 1997 D (FGIC)					5.75				02/01/07†				5,087,788
	9,000			Los Angeles Convention & Exhibition Center Authority, California, Ser 1985 COPs					9.00				12/01/05†				10,663,470
	19,600			San Francisco Redevelopment Agency, California, George R Moscone
				Convention Ctr Ser 1988 GAINS					8.50				07/01/04†				21,338,324
	2,500			Mid-Bay Bridge Authority, Florida, Ser 1991 A (ETM)					6.875				10/01/22				3,353,875
	1,600			Northern Palm Beach County Improvement District, Florida, Water Control & Impr #9A Ser 1996 A (ETM)					6.80				08/01/06				1,844,448
	8,000			Hawaii, 1999 Ser CT (FSA)					5.875				09/01/09†				9,638,800
				Massachusetts,
	10,000			2000 Ser C (original maturity 10/01/14)					5.75				10/01/10†				11,972,300
	10,000			2000 Ser C (original maturity 10/01/19)					5.75				10/01/10†				11,972,300
	2,500			Massachusetts, Health & Educational Facilities Authority, Malden Hospital – FHA Ins Mtge Ser A					5.00				08/01/10†				2,807,275

See Notes to Financial Statements

14

Morgan Stanley Tax-Exempt Securities Trust

Portfolio of Investments June 30, 2003 (unaudited) continued

PRINCIPAL AMOUNT IN THOUSANDS								COUPON RATE				MATURITY DATE				VALUE
$	5,075			Detroit, Michigan, Water Supply Sr Lien Ser 2001 A (FGIC)					5.25	%			07/01/11†			$	5,917,399
				New Jersey Highway Authority,
	10,000			Senior Parkway 2001 Ser (FGIC)					5.25				01/01/12†				10,916,100
	7,000			Senior Parkway 1999 Ser					5.625				01/01/10†				7,640,920
	6,000			New York Local Government Assistance Corporation, Ser 1995 A					6.00				04/01/05†				6,617,640
				New York State Dormitory Authority,
	7,800			State University Ser 2000 B					5.375				05/15/10†				9,170,694
	13,090			Suffolk County Judicial Ser 1986 (ETM)					7.375				07/01/16				16,904,164
				Charlotte, North Carolina
	5,000			Water & Sewer Ser 2000					5.25				06/01/10†				5,837,100
	4,000			Water & Sewer Ser 2000 (original maturity 06/01/19)					5.75				06/01/10†				4,795,080
	4,000			Water & Sewer Ser 2000 (original maturity 06/01/20)					5.75				06/01/10†				4,795,080
	10,000			North Carolina, 1997 Ser A					5.20				03/01/07†				11,403,300
	12,000			Pennsylvania, First Ser 1995 (FGIC)					5.50				05/01/05†				13,107,120
	9,000			San Antonio, Texas, Electric & Gas Refg Ser 1994 C (ETM)					4.70				02/01/06				9,742,050
	5,000			Salt Lake City, Utah, IHC Hospital Inc Ser 1983 (ETM)					5.00				06/01/15				5,677,400
	18,000			King County, Washington, Ltd Tax 1995 (MBIA)					6.00				01/01/05†				19,645,020
	183,600																210,847,647
	1,405,118			Total Tax-Exempt Municipal Bonds (Cost $1,327,648,710)													1,456,853,277
				Short-Term Tax-Exempt Municipal Obligations (4.3%)
	10,000			Los Angeles, California, Wastewater Ser 1994-A (MBIA)					5.875				06/01/04†				10,651,500
	15,270			Idaho Health Facilities Authority, St Lukes Regional Medical Ser 2000 (FSA) (Demand 07/01/03)					1.00	*			07/01/30				15,270,000
	10,500			Missouri Health & Educational Facilities Authority, Cox Health Ser 1997 (MBIA) (Demand 07/01/03)					1.00	*			06/01/15				10,500,000
	2,150			Reno, Nevada, St Mary's Regional Medical Center 1998 B (MBIA) (Demand 07/01/03)					1.00	*			05/15/23				2,150,000
	5,375			University of North Carolina, Hospitals at Chapel Hill Ser 2001 A (Demand 07/01/03)					1.00	*			02/15/31				5,375,000
				Harris County Health Facilities Development Corporation, Texas,
	9,500			Methodist Hospital Ser 2002 (Demand 07/01/03)					0.95	*			02/15/31				9,500,000
	12,500			St Luke's Episcopal Hospital Ser 2001 B (Demand 07/01/03)					0.95	*			12/01/32				12,500,000
	65,295			Total Short-Term Tax-Exempt Municipal Obligations (Cost $65,134,641)													65,946,500
$	1,470,413			Total Investments (Cost $1,392,783,351)(d) (e)									98.7	%			1,522,799,777
				Other Assets In Excess of Liabilities									1.3				19,753,294
				Net Assets									100.0	%		$	1,542,553,071

See Notes to Financial Statements

15

Morgan Stanley Tax-Exempt Securities Trust

Portfolio of Investments June 30, 2003 (unaudited) continued

AMT Alternative Minimum Tax.

BIGS Bond Income Growth Securities.

COPs Certificates of Participation.

ETM Escrowed to maturity.

GAINS Growth and Income Security.

PSF Texas Permanent School Fund Guarantee Program.

RITES Residual Interest Tax-Exempt Securities.

WI Security purchased on a when-issued basis.

† Prerefunded to call date shown.

†† Joint exemption in locations shown.

‡ Current coupon rate for residual interest bonds. This rate resets periodically as the auction rate on the related short-term security fluctuates.

# Currently a zero coupon security; will convert to 5.38% on January 1, 2011.

## Currently a zero coupon security; will convert to 5.65% on June 15, 2017.

* Current coupon of variable rate demand obligation.

** A portion of this security has been physically segregated in connection with open futures contracts.

(a) Issue in bankruptcy; non-income producing security.

(b) Issue in default; non-income producing security.

(c) Resale is restricted to qualified institutional investors.

(d) Securities have been designated as collateral in an amount equal to $52,809,691 in connection with the open futures contracts and the purchase of when-issued securities.

(e) The aggregate cost for federal income tax purposes approximates the aggregate cost for book purposes. The aggregate gross unrealized appreciation is $140,173,821, and the aggregate gross unrealized depreciation is $10,157,395, resulting in net unrealized appreciation of $130,016,426.

Bond Insurance:

Ambac
Ambac Assurance Corporation.

Connie Lee Connie Lee Insurance Company – A wholly owned subsidiary of Ambac Assurance Corporation.

FGIC
Financial Guaranty Insurance Company.

FSA
Financial Security Assurance Inc.

MBIA
MBIA Insurance Corporation.

Futures Contracts Open at June 30, 2003:

NUMBER OF CONTRACTS				LONG/SHORT				DESCRIPTION, DELIVERY MONTH AND YEAR				UNDERLYING FACE AMOUNT AT VALUE				UNREALIZED APPRECIATION
100				Short				U.S. Treasury Note 5 Yr September/2003				$	(11,512,500	)		$	3,869
50				Short				U.S. Treasury Note 10 Yr September/2003					(5,871,875	)			3,543
								Total unrealized appreciation								$	7,412

See Notes to Financial Statements

16

Morgan Stanley Tax-Exempt Securities Trust

Portfolio of Investments June 30, 2003 (unaudited) continued

Geographic Summary of Investments
Based on Market Value as a Percent of Net Assets

Alabama					0.5	%
Alaska					4.9
Arizona					3.2
California					5.8
Colorado					3.1
Connecticut					2.8
District of Columbia					0.7
Florida					2.5
Georgia					2.2
Hawaii					1.8
Idaho					1.1	%
Illinois					3.4
Indiana					1.7
Kansas					0.7
Kentucky					3.6
Maryland					0.5
Massachusetts					3.4
Michigan					1.9
Minnesota					0.4
Missouri					2.2
Nevada					1.8	%
New Hampshire					0.2
New Jersey					5.8
New Mexico					0.5
New York					8.5
North Carolina					3.8
Ohio					3.9
Oregon					0.1
Pennsylvania					2.7
Puerto Rico					1.7
South Carolina					4.6	%
Tennessee					2.0
Texas					11.1
Utah					1.5
Virginia					0.9
Washington					3.2
Wisconsin					0.7
Joint Exemption*					(0.7	)
Total					98.7	%

* Joint exemption has been included in each geographic location.

See Notes to Financial Statements

17

Morgan Stanley Tax-Exempt Securities Trust

Financial Statements

Statement of Assets and Liabilities

June 30, 2003 (unaudited)

Assets:
Investments in securities, at value (cost $1,392,783,351)				$	1,522,799,777
Cash					2,467,741
Receivable for:
Investments sold					33,860,883
Interest					24,173,001
Shares of beneficial interest sold					1,014,517
Variation margin					7,412
Prepaid expenses and other assets					95,786
Total Assets					1,584,419,117
Liabilities:
Payable for:
Investments purchased					38,799,517
Shares of beneficial interest redeemed					1,344,092
Dividends to shareholders					770,581
Investment management fee					539,830
Distribution fee					177,118
Accrued expenses and other payables					234,908
Total Liabilities					41,866,046
Net Assets				$	1,542,553,071
Composition of Net Assets:
Paid-in-capital				$	1,408,462,005
Net unrealized appreciation					130,023,838
Accumulated undistributed net investment income					109,828
Accumulated undistributed net realized gain					3,957,400
Net Assets				$	1,542,553,071
Class A Shares:
Net Assets				$	136,578,929
Shares Outstanding (unlimited authorized, $.01 par value)					11,338,565
Net Asset Value Per Share				$	12.05
Maximum Offering Price Per Share,
(net asset value plus 4.44% of net asset value)				$	12.58
Class B Shares:
Net Assets				$	244,620,907
Shares Outstanding (unlimited authorized, $.01 par value)					20,216,712
Net Asset Value Per Share				$	12.10
Class C Shares:
Net Assets				$	39,682,038
Shares Outstanding (unlimited authorized, $.01 par value)					3,288,834
Net Asset Value Per Share				$	12.07
Class D Shares:
Net Assets				$	1,121,671,197
Shares Outstanding (unlimited authorized, $.01 par value)					93,134,774
Net Asset Value Per Share				$	12.04

See Notes to Financial Statements

18

Morgan Stanley Tax-Exempt Securities Trust

Financial Statements continued

Statement of Operations

For the six months ended June 30, 2003 (unaudited)

Net Investment Income:
Interest Income				$	40,439,294
Expenses
Investment management fee					3,114,541
Distribution fee (Class A shares)					107,082
Distribution fee (Class B shares)					714,403
Distribution fee (Class C shares)					120,532
Transfer agent fees and expenses					404,927
Shareholder reports and notices					47,805
Professional fees					35,993
Registration fees					34,771
Custodian fees					32,109
Trustees' fees and expenses					16,146
Other					35,856
Total Expenses					4,664,165
Less: expense offset					(31,925	)
Net Expenses					4,632,240
Net Investment Income					35,807,054
Net Realized and Unrealized Gain:
Net realized gain on investments					3,961,110
Net Change in Unrealized Appreciation on:
Investments					17,619,614
Futures contracts					7,412
Net Appreciation					17,627,026
Net Gain					21,588,136
Net Increase				$	57,395,190

See Notes to Financial Statements

19

Morgan Stanley Tax-Exempt Securities Trust

Financial Statements continued

Statement of Changes in Net Assets

				FOR THE SIX MONTHS ENDED JUNE 30, 2003				FOR THE YEAR ENDED DECEMBER 31, 2002
				(unaudited)
Increase (Decrease) in Net Assets:
Operations:
Net investment income				$	35,807,054			$	70,087,291
Net realized gain					3,961,110				8,090,590
Net change in unrealized appreciation					17,627,026				48,291,629
Net Increase					57,395,190				126,469,510
Dividends and Distributions to Shareholders from:
Net investment income
Class A shares					(2,814,583	)			(1,788,839	)
Class B shares					(4,968,892	)			(9,447,499	)
Class C shares					(695,966	)			(929,364	)
Class D shares					(26,786,285	)			(57,919,499	)
Net realized gain*
Class A shares					(66,399	)			(624,930	)
Class B shares					(123,127	)			(1,480,545	)
Class C shares					(19,944	)			(177,816	)
Class D shares					(568,167	)			(7,487,752	)
Total Dividends and Distributions					(36,043,363	)			(79,856,244	)
Net increase (decrease) from transactions in shares of beneficial interest					(17,246,380	)			58,795,650
Net Increase					4,105,447				105,408,916
Net Assets:
Beginning of period					1,538,447,624				1,433,038,708
End of Period
(Including accumulated undistributed net investment income of $109,828 and dividends in excess of net investment income of $431,500, respectively)				$	1,542,553,071			$	1,538,447,624

* Includes short-term gains of

Class A shares					—			$	50,013
Class B shares					—				97,264
Class C shares					—				12,240
Class D shares					—				478,843
Total short-term gains					—			$	638,360

See Notes to Financial Statements

20

Morgan Stanley Tax-Exempt Securities Trust

Notes to Financial Statements June 30, 2003 (unaudited)

1.   Organization and Accounting Policies

Morgan Stanley Tax-Exempt Securities Trust (the "Fund") is registered under the Investment Company Act of 1940, as amended (the "Act"), as a diversified, open-end management investment company. The Fund's investment objective is to provide a high level of current income which is exempt from federal income tax, consistent with the preservation of capital. The Fund was incorporated in Maryland in 1979, commenced operations on March 27, 1980 and reorganized as a Massachusetts business trust on April 30, 1987. On July 28, 1997, the Fund converted to a multiple class share structure.

The Fund offers Class A shares, Class B shares, Class C shares and Class D shares. The four classes are substantially the same except that most Class A shares are subject to a sales charge imposed at the time of purchase and some Class A shares, and most Class B shares and Class C shares are subject to a contingent deferred sales charge imposed on shares redeemed within one year, six years and one year, respectively. Class D shares are not subject to a sales charge. Additionally, Class A shares, Class B shares and Class C shares incur distribution expenses.

The following is a summary of significant accounting policies:

A.   Valuation of Investments — (1) portfolio securities are valued by an outside independent pricing service approved by the Trustees. The pricing service uses both a computerized grid matrix of tax-exempt securities and evaluations by its staff, in each case based on information concerning market transactions and quotations from dealers which reflect the bid side of the market each day. The portfolio securities are thus valued by reference to a combination of transactions and quotations for the same or other securities believed to be comparable in quality, coupon, maturity, type of issue, call provisions, trading characteristics and other features deemed to be relevant; (2) futures are valued at the latest sale price on the commodities exchange on which they trade unless it is determined that such price does not reflect their market value, in which case they will be valued at their fair value as determined in good faith under procedures established by and under the supervision of the Trustees; and (3) short-term debt securities having a maturity date of more than sixty days at time of purchase are valued on a mark-to-market basis until sixty days prior to maturity and thereafter at amortized cost based on their value on the 61st day. Short-term debt securities having a maturity date of sixty days or less at the time of purchase are valued at amortized cost.

B.   Accounting for Investments — Security transactions are accounted for on the trade date (date the order to buy or sell is executed). Realized gains and losses on security transactions are determined by the identified cost method. Discounts are accreted and premiums are amortized over the life of the respective securities. Interest income is accrued daily.

21

Morgan Stanley Tax-Exempt Securities Trust

Notes to Financial Statements June 30, 2003 (unaudited) continued

C.   Multiple Class Allocations — Investment income, expenses (other than distribution fees), and realized and unrealized gains and losses are allocated to each class of shares based upon the relative net asset value on the date such items are recognized. Distribution fees are charged directly to the respective class.

D.   Futures Contracts — A futures contract is an agreement between two parties to buy and sell financial instruments or contracts based on financial indices at a set price on a future date. Upon entering into such a contract, the Fund is required to pledge to the broker cash, U.S. Government securities or other liquid portfolio securities equal to the minimum initial margin requirements of the applicable futures exchange. Pursuant to the contract, the Fund agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in the value of the contract. Such receipts or payments known as variation margin are recorded by the Fund as unrealized gains and losses. Upon closing of the contract, the Fund realizes a gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed.

E.   Federal Income Tax Policy — It is the Fund's policy to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its taxable and nontaxable income to its shareholders. Accordingly, no federal income tax provision is required.

F.   Dividends and Distributions to Shareholders — Dividends and distributions to shareholders are recorded on the ex-dividend date. The amount of dividends and distributions from net investment income and net realized capital gains are determined in accordance with federal income tax regulations which may differ from generally accepted accounting principles. These "book/tax" differences are either considered temporary or permanent in nature. To the extent these differences are permanent in nature, such amounts are reclassified within the capital accounts based on their federal tax-basis treatment; temporary differences do not require reclassification. Dividends and distributions which exceed net investment income and net realized capital gains for financial reporting purposes but not for tax purposes are reported as dividends in excess of net investment income or distributions in excess of net realized capital gains. To the extent they exceed net investment income and net realized capital gains for tax purposes, they are reported as distributions of paid-in-capital.

G.   Use of Estimates — The preparation of financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts and disclosures. Actual results could differ from those estimates.

2.   Investment Management Agreement

Pursuant to an Investment Management Agreement with Morgan Stanley Investment Advisors Inc. (the "Investment Manager"), the Fund pays the Investment Manager a management fee, accrued daily and payable monthly, by applying the following annual rates to the Fund's net assets determined as of the close of each business day: 0.50% to the portion of daily net assets not exceeding $500 million; 0.425% to the portion of daily net assets exceeding $500 million but not exceeding $750 million; 0.375% to the

22

Morgan Stanley Tax-Exempt Securities Trust

Notes to Financial Statements June 30, 2003 (unaudited) continued

portion of daily net assets exceeding $750 million but not exceeding $1 billion; 0.35% to the portion of daily net assets exceeding $1 billion but not exceeding $1.25 billion; 0.325% to the portion of daily net assets exceeding $1.25 billion but not exceeding $2.5 billion; and 0.30% to the portion of daily net assets exceeding $2.5 billion.

3.   Plan of Distribution

Shares of the Fund are distributed by Morgan Stanley Distributors Inc. (the "Distributor"), an affiliate of the Investment Manager. The Fund has adopted a Plan of Distribution (the "Plan") pursuant to Rule 12b-1 under the Act. The Plan provides that the Fund will pay the Distributor a fee which is accrued daily and paid monthly at the following annual rates: (i) Class A – up to 0.25% of the average daily net assets of Class A; (ii) Class B – 0.60% of the average daily net assets of Class B; and (iii) Class C – up to 0.70% of the average daily net assets of Class C.

In the case of Class B shares, provided that the Plan continues in effect, any cumulative expenses incurred by the Distributor but not yet recovered may be recovered through the payment of future distribution fees from the Fund pursuant to the Plan and contingent deferred sales charges paid by investors upon redemption of Class B shares. Although there is no legal obligation for the Fund to pay expenses incurred in excess of payments made to the Distributor under the Plan and the proceeds of contingent deferred sales charges paid by investors upon redemption of shares, if for any reason the Plan is terminated, the Trustees will consider at that time the manner in which to treat such expenses. The Distributor has advised the Fund that such excess amounts totaled $6,959,476 at June 30, 2003.

In the case of Class A shares and Class C shares, expenses incurred pursuant to the Plan in any calendar year in excess of 0.25% or 0.70% of the average daily net assets of Class A or Class C, respectively, will not be reimbursed by the Fund through payments in any subsequent year, except that expenses representing a gross sales credit to Morgan Stanley Financial Advisors or other selected broker-dealer representatives may be reimbursed in the subsequent calendar year. For the six months ended June 30, 2003, the distribution fee was accrued for Class A shares and Class C shares at the annual rate of 0.17% and 0.70%, respectively.

The Distributor has informed the Fund that for the six months ended June 30, 2003, it received contingent deferred sales charges from certain redemptions of the Fund's Class B shares and Class C shares of $166,789 and $2,718, respectively and received $194,198 in front-end sales charges from sales of the Fund's Class A shares. The respective shareholders pay such charges which are not an expense of the Fund.

4.   Security Transactions and Transactions with Affiliates

The cost of purchases and proceeds from sales of portfolio securities, excluding short-term investments, for the six months ended June 30, 2003 aggregated $162,176,430 and $169,711,102, respectively.

23

Morgan Stanley Tax-Exempt Securities Trust

Notes to Financial Statements June 30, 2003 (unaudited) continued

Morgan Stanley Trust, an affiliate of the Investment Manager and Distributor, is the Fund's transfer agent. At June 30, 2003, the Fund had transfer agent fees and expenses payable of approximately $10,500.

The Fund has an unfunded noncontributory defined benefit pension plan covering all independent Trustees of the Fund who will have served as independent Trustees for at least five years at the time of retirement. Benefits under this plan are based on years of service and compensation during the last five years of service. Aggregate pension costs for the six months ended June 30, 2003 included in Trustees' fees and expenses in the Statement of Operations amounted to $8,628. At June 30, 2003, the Fund had an accrued pension liability of $119,127 which is included in accrued expenses in the Statement of Assets and Liabilities.

5.   Federal Income Tax Status

At December 31, 2002, the Fund had temporary book/tax differences primarily attributable to book amortization of discount on debt securities.

6.   Expense Offset

The expense offset represents a reduction of the custodian fees for earnings on cash balances maintained by the Fund.

7.   Risks Relating to Certain Financial Instruments

The Fund may invest a portion of its assets in residual interest bonds, which are inverse floating rate municipal obligations. The prices of these securities are subject to greater market fluctuations during periods of changing prevailing interest rates than are comparable fixed rate obligations.

At June 30, 2003, the Fund held positions in residual interest bonds having a total value of $73,322,920, which represents 4.8% of the Fund's net assets.

To hedge against adverse interest rate changes, the Fund may invest in financial futures contracts or municipal bond index futures contracts ("futures contracts").

These futures contracts involve elements of market risk in excess of the amount reflected in the Statement of Assets and Liabilities. The Fund bears the risk of an unfavorable change in the value of the underlying securities.

At June 30, 2003, the Fund had outstanding futures contracts.

24

Morgan Stanley Tax-Exempt Securities Trust

Notes to Financial Statements June 30, 2003 (unaudited) continued

8.   Shares of Beneficial Interest

Transactions in shares of beneficial interest were as follows:

				FOR THE SIX MONTHS ENDED JUNE 30, 2003								FOR THE YEAR ENDED DECEMBER 31, 2002
				(unaudited)
				SHARES				AMOUNT				SHARES				AMOUNT
CLASS A SHARES
Sold					10,320,183			$	123,636,111				7,617,423			$	89,539,965
Reinvestment of dividends and distributions					178,547				2,129,435				126,463				1,492,518
Shares issued in connection with the acquisition of the Morgan Stanley Select Municipal Reinvestment Fund (See Note 9)					—				—				6,193,528				73,196,868
Redeemed					(9,315,050	)			(111,612,638	)			(6,128,267	)			(71,987,138	)
Net increase – Class A					1,183,680				14,152,908				7,809,147				92,242,213
CLASS B SHARES
Sold					2,240,939				26,772,901				7,363,472				86,955,912
Reinvestment of dividends and distributions					199,682				2,392,086				465,106				5,489,292
Redeemed					(1,946,776	)			(23,309,208	)			(5,439,491	)			(64,199,912	)
Net increase – Class B					493,845				5,855,779				2,389,087				28,245,292
CLASS C SHARES
Sold					1,540,861				18,396,200				2,498,384				29,369,636
Reinvestment of dividends and distributions					36,734				439,231				62,523				736,937
Redeemed					(779,979	)			(9,317,262	)			(1,480,576	)			(17,373,619	)
Net increase – Class C					797,616				9,518,169				1,080,331				12,732,954
CLASS D SHARES
Sold					2,382,903				28,268,290				5,241,723				61,748,259
Reinvestment of dividends and distributions					1,101,379				13,133,333				2,768,369				32,495,282
Redeemed					(7,408,766	)			(88,174,859	)			(14,371,570	)			(168,668,350	)
Net decrease – Class D					(3,924,484	)			(46,773,236	)			(6,361,478	)			(74,424,809	)
Net increase (decrease) in Fund					(1,449,343	)		$	(17,246,380	)			4,917,087			$	58,795,650

9.   Acquisition of Morgan Stanley Select Municipal Reinvestment Fund

On December 16, 2002, the Fund acquired all the net assets of the Morgan Stanley Select Municipal Reinvestment Fund ("Select Municipal Reinvestment") based on the respective valuations as of the close of business on December 13, 2002, pursuant to a plan of reorganization approved by the shareholders of Select Municipal Reinvestment on December 10, 2002. The acquisition was accomplished by a tax-free exchange of 6,193,528 Class A shares of the Fund at a net asset value of $11.82 per share for 6,047,876 shares of Select Municipal Reinvestment. The net assets of the Fund and Select Municipal Reinvestment

25

Morgan Stanley Tax-Exempt Securities Trust

Notes to Financial Statements June 30, 2003 (unaudited) continued

immediately before the acquisition were $1,450,632,309 and $73,196,868, respectively, including unrealized appreciation of $4,483,887 for Select Municipal Reinvestment. Immediately after the acquisition, the combined net assets of the Fund amounted to $1,523,829,177.

26

Morgan Stanley Tax-Exempt Securities Trust

Financial Highlights

Selected ratios and per share data for a share of beneficial interest outstanding throughout each period:

				FOR THE SIX MONTHS ENDED JUNE 30, 2003				FOR THE YEAR ENDED DECEMBER 31,
								2002				2001				2000				1999				1998
					(unaudited)
Class A Shares
Selected Per Share Data:
Net asset value, beginning of period				$	11.88			$	11.50			$	11.71			$	11.08			$	12.02			$	12.09
Income (loss) from investment operations:
Net investment income					0.28				0.56				0.59				0.58				0.58				0.59
Net realized and unrealized gain (loss)					0.17				0.46				(0.12	)			0.63				(0.91	)			0.10
Total income (loss) from investment operations					0.45				1.02				0.47				1.21				(0.33	)			0.69
Less dividends and distributions from:
Net investment income					(0.27	)			(0.56	)			(0.58	)			(0.58	)			(0.58	)			(0.59	)
Net realized gain					(0.01	)			(0.08	)			(0.10	)			—				(0.03	)			(0.17	)
Total dividends and distributions					(0.28	)			(0.64	)			(0.68	)			(0.58	)			(0.61	)			(0.76	)
Net asset value, end of period				$	12.05			$	11.88			$	11.50			$	11.71			$	11.08			$	12.02
Total Return†					3.77	% (1)			9.03	%			4.05	%			11.21	%			(2.82	)%			5.86	%
Ratios to Average Net Assets(4):
Expenses (before expense offset)					0.66	% (2)			0.67	%			0.66	% (3)			0.72	%			0.64	%(3)			0.74	% (3)
Net investment income					4.67	% (2)			4.74	%			4.97	%			5.14	%			4.98	%			4.88	%
Supplemental Data:
Net assets, end of period, in thousands					$136,579				$120,659				$26,984				$21,685				$17,198				$15,041
Portfolio turnover rate					11	% (1)			13	%			17	%			17	%			13	%			15	%

† Does not reflect the deduction of sales charge. Calculated based on the net asset value as of the last business day of the period.

(1) Not annualized.

(2) Annualized.

(3) Does not reflect the effect of expense offset of 0.01%.

(4) Reflects overall Fund ratios for investment income and non-class specific expenses.

See Notes to Financial Statements

27

Morgan Stanley Tax-Exempt Securities Trust

Financial Highlights continued

				FOR THE SIX MONTHS ENDED JUNE 30, 2003				FOR THE YEAR ENDED DECEMBER 31,
								2002				2001				2000				1999				1998
					(unaudited)
Class B Shares
Selected Per Share Data:
Net asset value, beginning of period				$	11.93			$	11.56			$	11.76			$	11.13			$	12.07			$	12.14
Income (loss) from investment operations:
Net investment income					0.25				0.51				0.54				0.54				0.53				0.55
Net realized and unrealized gain (loss)					0.18				0.45				(0.11	)			0.63				(0.91	)			0.10
Total income (loss) from investment operations					0.43				0.96				0.43				1.17				(0.38	)			0.65
Less dividends and distributions from:
Net investment income					(0.25	)			(0.51	)			(0.53	)			(0.54	)			(0.53	)			(0.55	)
Net realized gain					(0.01	)			(0.08	)			(0.10	)			—				(0.03	)			(0.17	)
Total dividends and distributions.					(0.26	)			(0.59	)			(0.63	)			(0.54	)			(0.56	)			(0.72	)
Net asset value, end of period				$	12.10			$	11.93			$	11.56			$	11.76			$	11.13			$	12.07
Total Return†					3.55	% (1)			8.44	%			3.68	%			10.75	%			(3.25	)%			5.47	%
Ratios to Average Net Assets(4):
Expenses (before expense offset)					1.09	% (2)			1.09	%			1.09	% (3)			1.11	%			1.11	%(3)			1.10	% (3)
Net investment income					4.24	% (2)			4.32	%			4.54	%			4.75	%			4.51	%			4.52	%
Supplemental Data:
Net assets, end of period, in     thousands					$244,621				$235,358				$200,293				$156,972				$139,786				$132,303
Portfolio turnover rate					11	% (1)			13	%			17	%			17	%			13	%			15	%

† Does not reflect the deduction of sales charge. Calculated based on the net asset value as of the last business day of the period.

(1) Not annualized.

(2) Annualized.

(3) Does not reflect the effect of expense offset of 0.01%.

(4) Reflects overall Fund ratios for investment income and non-class specific expenses.

See Notes to Financial Statements

28

Morgan Stanley Tax-Exempt Securities Trust

Financial Highlights continued

				FOR THE SIX MONTHS ENDED JUNE 30, 2003				FOR THE YEAR ENDED DECEMBER 31,
								2002				2001				2000				1999				1998
					(unaudited)
Class C Shares
Selected Per Share Data:
Net asset value, beginning of period				$	11.90			$	11.53			$	11.73			$	11.10			$	12.04			$	12.11
Income (loss) from investment operations:
Net investment income					0.25				0.50				0.52				0.52				0.51				0.53
Net realized and unrealized gain (loss)					0.17				0.44				(0.10	)			0.63				(0.91	)			0.10
Total income (loss) from investment operations					0.42				0.94				0.42				1.15				(0.40	)			0.63
Less dividends and distributions from:
Net investment income					(0.24	)			(0.49	)			(0.52	)			(0.52	)			(0.51	)			(0.53	)
Net realized gain					(0.01	)			(0.08	)			(0.10	)			—				(0.03	)			(0.17	)
Total dividends and distributions					(0.25	)			(0.57	)			(0.62	)			(0.52	)			(0.54	)			(0.70	)
Net asset value, end of period				$	12.07			$	11.90			$	11.53			$	11.73			$	11.10			$	12.04
Total Return†					3.50	% (1)			8.34	%			3.58	%			10.66	%			(3.37	)%			5.36	%
Ratios to Average Net Assets(4):
Expenses (before expense offset)					1.19	% (2)			1.19	%			1.19	% (3)			1.21	%			1.21	%(3)			1.20	% (3)
Net investment income					4.14	% (2)			4.22	%			4.44	%			4.65	%			4.41	%			4.34	%
Supplemental Data:
Net assets, end of period, in thousands					$39,682				$29,648				$16,270				$11,578				$10,025				$7,599
Portfolio turnover rate					11	% (1)			13	%			17	%			17	%			13	%			15	%

† Does not reflect the deduction of sales charge. Calculated based on the net asset value as of the last business day of the period.

(1) Not annualized.

(2) Annualized.

(3) Does not reflect the effect of expense offset of 0.01%.

(4) Reflects overall Fund ratios for investment income and non-class specific expenses.

See Notes to Financial Statements

29

Morgan Stanley Tax-Exempt Securities Trust

Financial Highlights continued

				FOR THE SIX MONTHS ENDED JUNE 30, 2003				FOR THE YEAR ENDED DECEMBER 31,
								2002				2001				2000				1999				1998
					(unaudited)
Class D Shares
Selected Per Share Data:
Net asset value, beginning of period				$	11.88			$	11.50			$	11.70			$	11.07			$	12.01			$	12.08
Income (loss) from investment operations:
Net investment income					0.29				0.58				0.61				0.60				0.59				0.62
Net realized and unrealized gain (loss)					0.16				0.46				(0.11	)			0.63				(0.91	)			0.10
Total income (loss) from investment operations					0.45				1.04				0.50				1.23				(0.32	)			0.72
Less dividends and distributions from:
Net investment income					(0.28	)			(0.58	)			(0.60	)			(0.60	)			(0.59	)			(0.62	)
Net realized gain					(0.01	)			(0.08	)			(0.10	)			—				(0.03	)			(0.17	)
Total dividends and distributions					(0.29	)			(0.66	)			(0.70	)			(0.60	)			(0.62	)			(0.79	)
Net asset value, end of period				$	12.04			$	11.88			$	11.50			$	11.70			$	11.07			$	12.01
Total Return†					3.77	% (1)			9.21	%			4.31	%			11.44	%			(2.71	)%			6.11	%
Ratios to Average Net Assets(4):
Expenses (before expense offset)					0.49	% (2)			0.49	%			0.49	% (3)			0.51	%			0.51	%(3)			0.50	% (3)
Net investment income					4.84	% (2)			4.92	%			5.14	%			5.35	%			5.11	%			5.12	%
Supplemental Data:
Net assets, end of period, in     thousands					$1,121,671				$1,152,783				$1,189,492				$852,950				$853,216				$1,023,246
Portfolio turnover rate					11	% (1)			13	%			17	%			17	%			13	%			15	%

† Does not reflect the deduction of sales charge. Calculated based on the net asset value as of the last business day of the period.

(1) Not annualized.

(2) Annualized.

(3) Does not reflect the effect of expense offset of 0.01%.

(4) Reflects overall Fund ratios for investment income and non-class specific expenses.

30

Trustees Michael Bozic Charles A. Fiumefreddo Edwin J. Garn Wayne E. Hedien James F. Higgins Dr. Manuel H. Johnson Joseph J. Kearns Michael E. Nugent Philip J. Purcell Fergus Reid Officers Charles A. Fiumefreddo Chairman of the Board Mitchell M. Merin President Ronald E. Robison Executive Vice President and Principal Executive Officer Barry Fink Vice President and General Counsel Joseph J. McAlinden Vice President Stefanie V. Chang Vice President Francis Smith Treasurer and Chief Financial Officer Thomas F. Caloia Vice President Mary E. Mullin Secretary Transfer Agent Morgan Stanley Trust Harborside Financial Center, Plaza Two Jersey City, New Jersey 07311 Independent Auditors Deloitte & Touche LLP Two World Financial Center New York, New York 10281 Investment Manager Morgan Stanley Investment Advisors Inc. 1221 Avenue of the Americas New York, New York 10020 The financial statements included herein have been taken from the records of the Fund without examination by the independent auditors and accordingly they do not express an opinion thereon. This report is submitted for the general information of the shareholders of the Fund. For more detailed information about the Fund, its fees and expenses and other pertinent information, please read its Prospectus. The Fund's Statement of Additional Information contains additional information about the Fund, including its trustees. It is available, without charge, by calling (800) 869-NEWS. This report is not authorized for distribution to prospective investors in the Fund unless preceded or accompanied by an effective Prospectus. Read the prospectus carefully before investing. Investments and services offered through Morgan Stanley DW Inc., member SIPC. Morgan Stanley Distributors Inc., member NASD. © 2003 Morgan Stanley 37950rpt-11784G03-AP-7/03		MUNICIPAL NATIONAL INTERMEDIATE
		Morgan Stanley Tax-Exempt Securities Trust Semiannual Report June 30, 2003

Item 9 - Controls and Procedures

  The Fund's principal executive officer and principal financial officer have
concluded that the Fund's disclosure controls and procedures are sufficient to
ensure that information required to be disclosed by the Fund in this Form N-CSR
was recorded, processed, summarized and reported within the time periods
specified in the Securities and Exchange Commission's rules and forms, based
upon such officers' evaluation of these controls and procedures as of a date
within 90 days of the filing date of the report.

    There were no significant changes or corrective actions with regard to
significant deficiencies or material weaknesses in the Fund's internal controls
or in other factors that could significantly affect the Fund's internal controls
subsequent to the date of their evaluation.

Item 10b Exhibits
A separate certification for each principal executive officer and principal
financial officer of the registrant are attached hereto as part of EX-99.CERT.

Items 2 - 8 and Item 10a are not applicable


                                   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.

Morgan Stanley Tax-Exempt Securities Trust
Ronald E. Robison
Principal Executive Officer
August 19, 2003

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

Ronald E. Robison
Principal Executive Officer
August 19, 2003

Francis Smith
Principal Financial Officer
August 19, 2003




















                                       2

                                                                      EXHIBIT B1

                  CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

                                 CERTIFICATIONS

I, Ronald E. Robison, certify that:

     1.   I have reviewed this report on Form N-CSR of Morgan Stanley Tax-Exempt
          Securities Trust;

     2.   Based on my knowledge, this report does not contain any untrue
          statement of a material fact or omit to state a material fact
          necessary to make the statements made, in light of the circumstances
          under which such statements were made, not misleading with respect to
          the period covered by this report;

     3.   Based on my knowledge, the financial statements, and other financial
          information included in this report, fairly present in all material
          respects the financial condition, results of operations, changes in
          net assets, and cash flows (if the financial statements are required
          to include a statement of cash flows) of the registrant as of, and
          for, the periods presented in this report;

     4.   The registrant's other certifying officers and I are responsible for
          establishing and maintaining disclosure controls and procedures (as
          defined in Rule 30a-2(c) under the Investment Company Act of 1940) for
          the registrant and have:

     a)   designed such disclosure controls and procedures to ensure that
          material information relating to the registrant, including its
          consolidated subsidiaries, is made known to us by others within those
          entities, particularly during the period in which this report is being
          prepared;

     b)   evaluated the effectiveness of the registrant's disclosure controls
          and procedures as of a date within 90 days prior to the filing date of
          this report (the "Evaluation Date"); and

     c)   presented in this report our conclusions about the effectiveness of
          the disclosure controls and procedures based on our evaluation as of
          the Evaluation Date;

                                       3

     5.   The registrant's other certifying officers and I have disclosed, based
          on our most recent evaluation, to the registrant's auditors and the
          audit committee of the registrant's board of directors (or persons
          performing the equivalent functions):

     a)   all significant deficiencies in the design or operation of internal
          controls which could adversely affect the registrant's ability to
          record, process, summarize, and report financial data and have
          identified for the registrant's auditors any material weaknesses in
          internal controls; and

     b)   any fraud, whether or not material, that involves management or other
          employees who have a significant role in the registrant's internal
          controls; and

     6.   The registrant's other certifying officers and I have indicated in
          this report whether or not there were significant changes in internal
          controls or in other factors that could significantly affect internal
          controls subsequent to the date of our most recent evaluation,
          including any corrective actions with regard to significant
          deficiencies and material weaknesses.

Date: August 19, 2003



                                                  Ronald E. Robison

                                                  Principal Executive Officer


                                       4

                                                                      EXHIBIT B2

                  CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

                                 CERTIFICATIONS

I, Francis Smith, certify that:

     1.   I have reviewed this report on Form N-CSR of Morgan Stanley Tax-Exempt
          Securities Trust;

     2.   Based on my knowledge, this report does not contain any untrue
          statement of a material fact or omit to state a material fact
          necessary to make the statements made, in light of the circumstances
          under which such statements were made, not misleading with respect to
          the period covered by this report;

     3.   Based on my knowledge, the financial statements, and other financial
          information included in this report, fairly present in all material
          respects the financial condition, results of operations, changes in
          net assets, and cash flows (if the financial statements are required
          to include a statement of cash flows) of the registrant as of, and
          for, the periods presented in this report;

     4.   The registrant's other certifying officers and I are responsible for
          establishing and maintaining disclosure controls and procedures (as
          defined in Rule 30a-2(c) under the Investment Company Act of 1940) for
          the registrant and have:

     (i)  designed such disclosure controls and procedures to ensure that
          material information relating to the registrant, including its
          consolidated subsidiaries, is made known to us by others within those
          entities, particularly during the period in which this report is being
          prepared;

     (ii) evaluated the effectiveness of the registrant's disclosure controls
          and procedures as of a date within 90 days prior to the filing date of
          this report (the "Evaluation Date"); and

    (iii) presented in this report our conclusions about the effectiveness of
          the disclosure controls and procedures based on our evaluation as of
          the Evaluation Date;

     5.   The registrant's other certifying officers and I have disclosed, based
          on our most recent evaluation, to the registrant's auditors and the
          audit committee of the registrant's board of directors (or persons
          performing the equivalent functions):

                                       5

     a)   all significant deficiencies in the design or operation of internal
          controls which could adversely affect the registrant's ability to
          record, process, summarize, and report financial data and have
          identified for the registrant's auditors any material weaknesses in
          internal controls; and

     b)   any fraud, whether or not material, that involves management or other
          employees who have a significant role in the registrant's internal
          controls; and

     6.   The registrant's other certifying officers and I have indicated in
          this report whether or not there were significant changes in internal
          controls or in other factors that could significantly affect internal
          controls subsequent to the date of our most recent evaluation,
          including any corrective actions with regard to significant
          deficiencies and material weaknesses.

Date: August 19, 2003



                                                Francis Smith

                                                Principal Financial Officer


                                       6

                            SECTION 906 CERTIFICATION

                Certification Pursuant to 18 U.S.C. Section 1350,
                             As Adopted Pursuant to
                  Section 906 of the Sarbanes-Oxley Act of 2002

Morgan Stanley Tax-Exempt Securities Trust

     In connection with the Report on Form N-CSR (the "Report") of the
above-named issuer for the period ended June 30, 2003 that is accompanied by
this certification, the undersigned hereby certifies that:

1.   The Report fully complies with the requirements of Section 13(a) or 15(d)
     of the Securities Exchange Act of 1934; and

2.   The information contained in the Report fairly presents, in all material
     respects, the financial condition and results of operations of the Issuer.



Date: August 19, 2003                                 Ronald E. Robison
                                                  Principal Executive Officer


A signed original of this written statement required by Section 906 has been
provided to Morgan Stanley Tax-Exempt Securities Trust will be retained by
Morgan Stanley Tax-Exempt Securities Trust and furnished to the Securities and
Exchange Commission or its staff upon request.


                                       7

                            SECTION 906 CERTIFICATION

                Certification Pursuant to 18 U.S.C. Section 1350,
                             As Adopted Pursuant to
                  Section 906 of the Sarbanes-Oxley Act of 2002

Morgan Stanley Tax-Exempt Securities Trust

     In connection with the Report on Form N-CSR (the "Report") of the
above-named issuer for the period ended June 30, 2003 that is accompanied by
this certification, the undersigned hereby certifies that:

1.   The Report fully complies with the requirements of Section 13(a) or 15(d)
     of the Securities Exchange Act of 1934; and

2.   The information contained in the Report fairly presents, in all material
     respects, the financial condition and results of operations of the Issuer.



Date: August 19, 2003                                Francis Smith
                                            Principal Financial Officer


A signed original of this written statement required by Section 906 has been
provided to Morgan Stanley Tax-Exempt Securities Trust and will be retained by
Morgan Stanley Tax-Exempt Securities Trust and furnished to the Securities and
Exchange Commission or its staff upon request.








                                       8