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 811-4707

Fidelity Advisor Series II
(Exact name of registrant as specified in charter)

82 Devonshire St., Boston, Massachusetts 02109
(Address of principal executive offices) (Zip code)

Eric D. Roiter, Secretary

82 Devonshire St.

Boston, Massachusetts 02109
(Name and address of agent for service)

Registrant's telephone number, including area code: 617-563-7000

Date of fiscal year end:	October 31

Date of reporting period:	October 31, 2006

Item 1. Reports to Stockholders

(Fidelity Investment logo)(registered trademark)

Fidelity® Advisor

Municipal Income Fund -
Class A, Class T, Class B
and Class C

Annual Report

October 31, 2006

(2_fidelity_logos) (Registered_Trademark)

Chairman's Message	<Click Here>	Ned Johnson's message to shareholders.
Performance	<Click Here>	How the fund has done over time.
Management's Discussion	<Click Here>	The manager's review of fund performance, strategy and outlook.
Shareholder Expense Example	<Click Here>	An example of shareholder expenses.
Investment Changes	<Click Here>	A summary of major shifts in the fund's investments over the past six months.
Investments	<Click Here>	A complete list of the fund's investments with their market values.
Financial Statements	<Click Here>	Statements of assets and liabilities, operations, and changes in net assets, as well as financial highlights.
Notes	<Click Here>	Notes to the financial statements.
Report of Independent Registered Public Accounting Firm	<Click Here>
Trustees and Officers	<Click Here>
Distributions	<Click Here>
Board Approval of Investment Advisory Contracts and Management Fees	<Click Here>

To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at www.sec.gov. You may also call 1-877-208-0098 to request a free copy of the proxy voting guidelines.

Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.

Other third party marks appearing herein are the property of their respective owners.

All other marks appearing herein are registered or unregistered trademarks or service marks of FMR Corp. or an affiliated company.

Annual Report

This report and the financial statements contained herein are submitted for the general information of the shareholders of the fund. This report is not authorized for distribution to prospective investors in the fund unless preceded or accompanied by an effective prospectus.

A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC's web site at http://www.sec.gov. A fund's Forms N-Q may be reviewed and copied at the SEC's Public Reference Room in Washington, DC. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330. For a complete list of a fund's portfolio holdings, view the most recent quarterly holdings report, semiannual report, or annual report on Fidelity's web site at http://www.advisor.fidelity.com.

NOT FDIC INSURED· MAY LOSE VALUE· NO BANK GUARANTEE

Neither the fund nor Fidelity Distributors Corporation is a bank.

Annual Report

Chairman's Message

(photo_of_Edward_C_Johnson_3d)

Dear Shareholder:

Stock and bond markets around the world have seen largely positive results year to date, although weakness in the technology sector and growth stocks in general have tempered performance. While financial markets are always unpredictable, there are a number of time-tested principles that can put the historical odds in your favor.

One of the basic tenets is to invest for the long term. Over time, riding out the markets' inevitable ups and downs has proven much more effective than selling into panic or chasing the hottest trend. Even missing only a few of the markets' best days can significantly diminish investor returns. Patience also affords the benefits of compounding - of earning interest on additional income or reinvested dividends and capital gains. There are tax advantages and cost benefits to consider as well. The more you sell, the more taxes you pay, and the more you trade, the higher the costs. While staying the course doesn't eliminate risk, it can considerably lessen the effect of short-term declines.

You can further manage your investing risk through diversification. And today, more than ever, geographic diversification should be taken into account. Studies indicate that asset allocation is the single most important determinant of a portfolio's long-term success. The right mix of stocks, bonds and cash - aligned to your particular risk tolerance and investment objective - is very important. Age-appropriate rebalancing is also an essential aspect of asset allocation. For younger investors, an emphasis on equities - which historically have been the best performing asset class over time - is encouraged. As investors near their specific goal, such as retirement or sending a child to college, consideration may be given to replacing volatile assets (e.g. common stocks) with more-stable fixed investments (bonds or savings plans).

A third investment principle - investing regularly - can help lower the average cost of your purchases. Investing a certain amount of money each month or quarter helps ensure you won't pay for all your shares at market highs. This strategy - known as dollar cost averaging - also reduces unconstructive "emotion" from investing, helping shareholders avoid selling weak performers just prior to an upswing, or chasing a hot performer just before a correction.

We invite you to contact us via the Internet, through our Investor Centers or over the phone. It is our privilege to provide you the information you need to make the investments that are right for you.

Sincerely,

/s/Edward C. Johnson 3d

Edward C. Johnson 3d

Annual Report

Performance: The Bottom Line

Average annual total return reflects the change in the value of an investment, assuming reinvestment of the class' dividend income and capital gains (the profits earned upon the sale of securities that have grown in value) and assuming a constant rate of performance each year. The $10,000 table and the fund's returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. During periods of reimbursement by Fidelity, a fund's total return will be greater than it would be had the reimbursement not occurred. How a fund did yesterday is no guarantee of how it will do tomorrow. Returns may reflect the conversion of Class B shares to Class A shares after a maximum of seven years.

Average Annual Total Returns

Periods ended October 31, 2006	Past 1 year	Past 5 years	Past 10 years
Class A (incl. 4.75% sales charge)	0.55%	4.13%	5.37%
Class T (incl. 3.50% sales charge)	1.67%	4.29%	5.41%
Class B (incl. contingent deferred sales charge)^A	-0.22%	4.04%	5.34%
Class C (incl. contingent deferred sales charge)^B	3.66%	4.27%	4.99%

^AClass B shares' contingent deferred sales charge included in the past one year, past five year, and past 10 year total return figures are 5%, 2%, and 0%, respectively.

^BClass C shares bear a 1.00% 12b-1 fee. The initial offering of Class C shares took place on November 3, 1997. Returns prior to November 3, 1997 are those of Class B shares and reflect Class B shares' 0.90% 12b-1 fee. Had Class C shares' 12b-1 fee been reflected, returns prior to November 3, 1997 would have been lower. Class C shares' contingent deferred sales charge included in the past one year, past five year, and past 10 year total return figures are 1%, 0%, and 0%, respectively.

Annual Report

$10,000 Over 10 Years

Let's say hypothetically that $10,000 was invested in Fidelity® Advisor Municipal Income Fund - Class T on October 31, 1996, and the current 3.50% sales charge was paid. The chart shows how the value of your investment would have changed, and also shows how the Lehman Brothers® Municipal Bond Index performed over the same period.

Annual Report

Management's Discussion of Fund Performance

Comments from Christine Thompson, Portfolio Manager of Fidelity® Advisor Municipal Income Fund

Growing investor demand and a strong late-period rally helped municipal bonds post solid returns and take their place as one of the best performing investment-grade debt classes for the 12 months ending October 31, 2006. Throughout much of the period, muni bond prices declined as the Federal Reserve Board raised short-term interest rates to return them to a more "neutral level" and fend off inflation. Beginning in mid-summer 2006, however, munis rebounded amid hopes that the Fed would pause its rate hike campaign. Those hopes were eventually actualized when the central bank left rates unchanged at its August, September and October Open Market Committee meetings. Demand - amplified by non-traditional investors such as hedge funds - increased substantially, as investors sought out munis for their attractive after-tax yields. Investors also were drawn to the fact that unlike Treasuries, long-term rates for munis were higher than short rates, giving investors the opportunity to lock in attractive long-term yields. Against this backdrop, the Lehman Brothers® Municipal Bond Index returned 5.75%. In comparison, the overall taxable bond market, as measured by the Lehman Brothers Aggregate Bond Index, returned 5.19%.

During the past year, the fund's Class A, Class T, Class B and Class C shares returned 5.56%, 5.36%, 4.78% and 4.66%, respectively (excluding sales charges), while the Lehman Brothers 3 Plus Year Municipal Bond Index gained 6.07%. Benefiting fund returns versus the index were my comparatively large stake in lower-quality, investment-grade securities and a modest out-of-index exposure to below-investment-grade bonds. These securities - generally issued by hospitals and electric utilities - were boosted by a combination of their improved financial performance and strong investor demand for high-yielding securities. Performance also was helped by my overweighting in zero-coupon bonds, which make no interest payments but are sold at a discount from their face values. Zeros generally performed better than coupon-bearing bonds. An overweighting relative to the index in prerefunded bonds also worked in the fund's favor. Prerefunding produced relatively strong returns as the bonds' maturities became shorter and their credit quality was upgraded. Detracting from performance relative to the index was my decision to underweight discount bonds, which are securities that trade below par - meaning face value - while overweighting premium bonds, which trade above par. Discounts outpaced premiums as investors sought out their higher nominal yields.

The views expressed above reflect those of the portfolio manager(s) only through the end of the period as stated on the cover of this report and do not necessarily represent the views of Fidelity or any other person in the Fidelity organization. Any such views are subject to change at any time based upon market or other conditions and Fidelity disclaims any responsibility to update such views. These views may not be relied on as investment advice and, because investment decisions for a Fidelity fund are based on numerous factors, may not be relied on as an indication of trading intent on behalf of any Fidelity fund.

Annual Report

Shareholder Expense Example

As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments or redemption proceeds, 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 at the beginning of the period and held for the entire period (May 1, 2006 to October 31, 2006).

Actual Expenses

Hypothetical Example for Comparison Purposes

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of 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.

	Beginning Account Value May 1, 2006	Ending Account Value October 31, 2006	Expenses Paid During Period * May 1, 2006 to October 31, 2006
Class A
Actual	$ 1,000.00	$ 1,040.60	$ 3.45
Hypothetical ^A	$ 1,000.00	$ 1,021.83	$ 3.41
Class T
Actual	$ 1,000.00	$ 1,040.00	$ 3.96
Hypothetical ^A	$ 1,000.00	$ 1,021.32	$ 3.92
Class B
Actual	$ 1,000.00	$ 1,036.80	$ 7.29
Hypothetical ^A	$ 1,000.00	$ 1,018.05	$ 7.22
	Beginning Account Value May 1, 2006	Ending Account Value October 31, 2006	Expenses Paid During Period * May 1, 2006 to October 31, 2006
Class C
Actual	$ 1,000.00	$ 1,036.20	$ 7.75
Hypothetical ^A	$ 1,000.00	$ 1,017.59	$ 7.68
Institutional Class
Actual	$ 1,000.00	$ 1,041.50	$ 2.78
Hypothetical ^A	$ 1,000.00	$ 1,022.48	$ 2.75

^A5% return per year before expenses

* Expenses are equal to each Class' annualized expense ratio (shown in the table below); multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).

	Annualized Expense Ratio
Class A	.67%
Class T	.77%
Class B	1.42%
Class C	1.51%
Institutional Class	.54%

Annual Report

Investment Changes

Top Five States as of October 31, 2006
	% of fund's net assets	% of fund's net assets 6 months ago
Texas	13.2	15.2
New York	12.0	9.3
California	11.2	11.2
Illinois	10.5	10.3
Washington	7.1	7.5
Top Five Sectors as of October 31, 2006
	% of fund's net assets	% of fund's net assets 6 months ago
General Obligations	37.8	37.1
Health Care	11.0	10.1
Electric Utilities	9.2	8.4
Transportation	8.9	8.5
Escrowed/Pre-Refunded	7.7	9.1
Average Years to Maturity as of October 31, 2006
		6 months ago
Years	15.2	15.3

Average years to maturity is based on the average time remaining to the stated maturity date of each bond, weighted by the market value of each bond.

Duration as of October 31, 2006
		6 months ago
Years	6.5	6.6

Duration shows how much a bond fund's price fluctuates with changes in comparable interest rates. If rates rise 1%, for example, a fund with a five-year duration is likely to lose about 5% of its value. Other factors also can influence a bond fund's performance and share price. Accordingly, a bond fund's actual performance may differ from this example.

Quality Diversification (% of fund's net assets)
As of October 31, 2006		As of April 30, 2006
	AAA 61.8%		AAA 63.7%
	AA,A 28.1%		AA,A 23.9%
	BBB 8.1%		BBB 6.6%
	BB and Below 0.2%		BB and Below 0.2%
	Not Rated 1.0%		Not Rated 1.3%
	Short-Term Investments and Net Other Assets 0.8%		Short-Term Investments and Net Other Assets 4.3%

We have used ratings from Moody's® Investors Services, Inc. Where Moody's ratings are not available, we have used S&P® ratings.

Annual Report

Investments October 31, 2006

Showing Percentage of Net Assets

Municipal Bonds - 99.3%
	Principal Amount		Value (Note 1)
Alabama - 0.0%
Birmingham Wtrwks. & Swr. Board Wtr. & Swr. Rev. Series B, 5% 1/1/43 (MBIA Insured)	$ 300,000		$ 310,914
Alaska - 0.2%
Alaska Student Ln. Corp. Student Ln. Rev. Series A, 5.45% 7/1/09 (AMBAC Insured) (d)	1,500,000		1,517,595
Arizona - 1.4%
Arizona Student Ln. Acquisition Auth. Student Ln. Rev. Series A1, 5.875% 5/1/18 (d)	1,300,000		1,377,948
Chandler Indl. Dev. Auth. Indl. Dev. Rev. (Intel Corp. Proj.) 4.375%, tender 12/1/10 (c)(d)	1,000,000		1,019,650
Glendale Indl. Dev. Auth. Hosp. Rev. (John C. Lincoln Health Network Proj.) 5% 12/1/29	1,575,000		1,627,164
Phoenix Civic Impt. Corp. Wtr. Sys. Rev. 5% 7/1/29 (MBIA Insured)	1,000,000		1,063,500
Phoenix Indl. Dev. Auth. Single Family Mtg. Rev. 0% 12/1/14 (Escrowed to Maturity) (e)	3,750,000		2,747,100
Univ. of Arizona Univ. Revs. Series 2005 A, 5% 6/1/17 (AMBAC Insured)	1,000,000		1,087,110
			8,922,472
Arkansas - 0.2%
Little Rock School District Series 2001 C, 5.25% 2/1/33 (FSA Insured)	1,000,000		1,047,490
California - 11.2%
California Dept. of Wtr. Resources Pwr. Supply Rev. Series A, 5.5% 5/1/15 (AMBAC Insured)	1,000,000		1,100,600
California Econ. Recovery:
Series 2004 A, 5.25% 7/1/13	2,100,000		2,304,792
Series A:
5% 7/1/15 (MBIA Insured)	1,800,000		1,969,848
5.25% 7/1/14	1,500,000		1,661,175
5.25% 7/1/14 (FGIC Insured)	900,000		999,882
California Gen. Oblig.:
5% 3/1/15	1,000,000		1,089,400
5% 12/1/31 (MBIA Insured)	1,400,000		1,473,864
5.125% 11/1/24	600,000		638,196
5.25% 2/1/14	2,400,000		2,629,104
5.25% 2/1/15	1,200,000		1,314,552
5.25% 2/1/16	1,000,000		1,094,830
5.25% 2/1/24	1,000,000		1,071,970
5.25% 2/1/28	1,200,000		1,280,520
5.25% 2/1/33	2,000,000		2,115,300
5.25% 12/1/33	2,300,000		2,464,519
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
California - continued
California Gen. Oblig.: - continued
5.25% 4/1/34	$ 2,200,000		$ 2,352,944
5.5% 4/1/30	3,565,000		3,924,102
5.5% 11/1/33	5,400,000		5,910,624
5.625% 5/1/20	80,000		85,899
California Pub. Works Board Lease Rev.:
(Richmond Lab., Phase III Office Bldg. Proj.) Series B, 5.25% 11/1/25 (XL Cap. Assurance, Inc. Insured)	2,585,000		2,818,917
Series 2005 A, 5.25% 6/1/30	2,000,000		2,139,480
Series 2005 H, 5% 6/1/18	1,425,000		1,530,778
Series 2005 K, 5% 11/1/17	2,300,000		2,486,760
California Statewide Cmntys. Dev. Auth. Poll. Cont. Rev. (Southern California Edison Co.) 4.1%, tender 4/1/13 (XL Cap. Assurance, Inc. Insured) (c)	1,300,000		1,330,901
California Statewide Cmntys. Dev. Auth. Rev. (Kaiser Fund Hosp./Health Place, Inc. Proj.) Series 2002 C, 3.85%, tender 6/1/12 (c)	500,000		500,735
Foothill/Eastern Trans. Corridor Agcy. Toll Road Rev.:
Series A, 5% 1/1/35 (MBIA Insured)	700,000		719,299
5% 1/15/16 (MBIA Insured)	400,000		421,700
5.75% 1/15/40	600,000		624,546
Golden State Tobacco Securitization Corp.:
Series 2003 A1, 6.75% 6/1/39	1,450,000		1,662,309
Series A, 5% 6/1/45	6,650,000		6,856,815
Los Angeles Dept. of Wtr. & Pwr. Wtrwks. Rev.:
Series 2001 A, 5.125% 7/1/41	4,000,000		4,144,640
Series A, 5.125% 7/1/41 (MBIA Insured)	1,300,000		1,352,585
Los Angeles Unified School District Series A, 5.375% 7/1/17 (Pre-Refunded to 7/1/13 @ 100) (e)	835,000		927,268
Oxnard Fing. Auth. Wastewtr. Rev. (Redwood Trunk Swr. and Headworks Proj.) Series A, 5% 6/1/29 (FGIC Insured)	1,000,000		1,053,550
San Diego Unified School District:
(Election of 1998 Proj.) Series E2, 5.5% 7/1/26 (FSA Insured)	2,300,000		2,728,168
Series F, 5% 7/1/29 (FSA Insured)	400,000		423,172
Southern California Pub. Pwr. Auth. Rev. (Magnolia Pwr. Proj.) Series A, 5% 7/1/36 (AMBAC Insured)	1,000,000		1,047,250
Univ. of California Revs. (UCLA Med. Ctr. Proj.) Series A:
5.5% 5/15/18 (AMBAC Insured)	1,755,000		1,938,117
5.5% 5/15/20 (AMBAC Insured)	2,000,000		2,198,100
			72,387,211
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Colorado - 1.8%
Colorado Health Facilities Auth. Retirement Hsg. Rev. (Liberty Heights Proj.) 0% 7/15/22 (Escrowed to Maturity) (e)	$ 1,365,000		$ 697,133
Colorado Health Facilities Auth. Rev. (Longmont Hosp. Proj.) Series B, 5.25% 12/1/13 (Radian Asset Assurance Ltd. Insured)	860,000		930,073
Colorado Springs Arpt. Rev. Series C, 0% 1/1/08 (MBIA Insured)	870,000		833,834
Colorado Wtr. Resources and Pwr. Dev. Auth. Clean Wtr. Rev. Series 2001 A:
5.625% 9/1/13	235,000		255,936
5.625% 9/1/14	230,000		250,277
Colorado Wtr. Resources and Pwr. Dev. Auth. Wtr. Resources Rev. (Parker Wtr. and Sanitation District Proj.) Series D, 5.25% 9/1/43 (MBIA Insured)	4,600,000		4,938,146
Dawson Ridge Metropolitan District #1 Series 1992 A, 0% 10/1/17 (Escrowed to Maturity) (e)	1,200,000		765,048
E-470 Pub. Hwy. Auth. Rev. Series 2000 A, 5.75% 9/1/29 (MBIA Insured)	1,200,000		1,308,288
Mesa County Residual Rev. 0% 12/1/11 (Escrowed to Maturity) (e)	2,275,000		1,876,375
			11,855,110
Connecticut - 0.5%
Eastern Connecticut Resources Recovery Auth. Solid Waste Rev. (Wheelabrator Lisbon Proj.) Series A, 5.5% 1/1/20 (d)	3,350,000		3,352,211
District Of Columbia - 2.1%
District of Columbia Gen. Oblig.:
Series A, 6% 6/1/07 (Escrowed to Maturity) (e)	10,000		10,144
Series B:
0% 6/1/12 (MBIA Insured)	1,200,000		962,676
5.25% 6/1/26 (FSA Insured)	6,000,000		6,218,340
District of Columbia Rev.:
(George Washington Univ. Proj.) Series A, 5.75% 9/15/20 (MBIA Insured)	1,490,000		1,585,271
(Georgetown Univ. Proj.) Series A, 5.95% 4/1/14 (MBIA Insured)	2,000,000		2,098,940
(Nat'l. Academy of Sciences Proj.) Series A, 5% 1/1/19 (AMBAC Insured)	2,500,000		2,610,300
			13,485,671
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Florida - 2.1%
Flagler County School Board Ctfs. Series A, 5% 8/1/12 (FSA Insured)	$ 1,000,000		$ 1,061,350
Florida Board of Ed. Cap. Outlay Series B, 5.5% 6/1/16 (FGIC Insured)	1,000,000		1,100,740
Florida Correctional Privatization Communications Ctfs. of Prtn. Series A, 5% 8/1/15 (AMBAC Insured)	1,000,000		1,078,410
Highlands County Health Facilities Auth. Rev. (Adventist Health Sys./Sunbelt Obligated Group Proj.):
Series B, 5% 11/15/14	1,000,000		1,068,820
3.95%, tender 9/1/12 (c)	2,100,000		2,099,916
5%, tender 11/16/09 (c)	1,800,000		1,858,752
JEA Elec. Sys. Rev. Series 3A, 5% 10/1/41 (FSA Insured)	1,000,000		1,051,090
Miami-Dade County Aviation Rev. (Miami Int'l. Arpt. Proj.) Series B, 5% 10/1/37 (FGIC Insured)	1,000,000		1,049,910
Miami-Dade County School District 5% 2/15/14 (MBIA Insured) (b)	1,600,000		1,721,904
Palm Beach County School Board Ctfs. of Prtn. Series C, 5% 8/1/27 (FSA Insured)	1,050,000		1,092,410
Seminole County School Board Ctfs. of Prtn. Series A, 5% 7/1/20 (MBIA Insured)	500,000		536,650
			13,719,952
Georgia - 2.8%
Atlanta Arpt. Rev. Series F, 5.25% 1/1/13 (FSA Insured) (d)	1,000,000		1,073,820
Atlanta Wtr. & Wastewtr. Rev.:
5% 11/1/37 (FSA Insured)	2,400,000		2,525,904
5% 11/1/43 (FSA Insured)	9,070,000		9,514,430
Augusta Wtr. & Swr. Rev. 5.25% 10/1/39 (FSA Insured)	2,200,000		2,387,946
Colquitt County Dev. Auth. Rev. Series A, 0% 12/1/21 (Escrowed to Maturity) (e)	1,100,000		584,672
Richmond County Dev. Auth. Rev. Series C, 0% 12/1/21 (Escrowed to Maturity) (e)	1,190,000		632,509
Savannah Econ. Dev. Auth. Rev. (Southern Care Corp. Proj.) Series C, 0% 12/1/21 (Escrowed to Maturity) (e)	2,500,000		1,328,800
			18,048,081
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Hawaii - 0.4%
Hawaii Arpt. Sys. Rev. Series 2000 B, 8% 7/1/11 (FGIC Insured) (d)	$ 1,300,000		$ 1,525,667
Honolulu City & County Board of Wtr. Supply Wtr. Sys. Rev. Series B, 5.25% 7/1/17 (MBIA Insured) (d)	1,250,000		1,367,825
			2,893,492
Illinois - 10.5%
Chicago Board of Ed.:
(Westinghouse High School Proj.) Series C, 5.25% 12/1/19 (MBIA Insured)	1,300,000		1,422,642
Series A, 0% 12/1/16 (FGIC Insured)	1,300,000		867,022
Chicago Gen. Oblig.:
(City Colleges Proj.):
0% 1/1/16 (FGIC Insured)	6,125,000		4,223,126
0% 1/1/24 (FGIC Insured)	6,110,000		2,919,541
(Neighborhoods Alive 21 Prog.) 5% 1/1/43 (AMBAC Insured)	1,000,000		1,040,190
Series A:
5% 1/1/42 (AMBAC Insured)	1,700,000		1,759,143
5.25% 1/1/33 (MBIA Insured)	1,070,000		1,125,608
5.25% 1/1/33 (Pre-Refunded to 1/1/11 @ 101) (e)	30,000		32,239
5.5% 1/1/38 (MBIA Insured)	255,000		273,401
5.5% 1/1/38 (Pre-Refunded to 1/1/11 @ 101) (e)	10,000		10,842
5.5% 1/1/40 (FGIC Insured)	525,000		559,409
Chicago Midway Arpt. Rev. Series B, 6% 1/1/09 (MBIA Insured) (d)	300,000		303,942
Chicago O'Hare Int'l. Arpt. Rev.:
Series A:
5.5% 1/1/16 (AMBAC Insured) (d)	900,000		920,358
6.25% 1/1/09 (AMBAC Insured) (d)	3,325,000		3,404,534
5.5% 1/1/09 (AMBAC Insured) (d)	1,250,000		1,293,625
Chicago Park District Series A, 5.5% 1/1/19 (FGIC Insured)	155,000		165,046
Chicago Transit Auth. Cap. Grant Receipts Rev. 5% 6/1/21 (AMBAC Insured) (b)	1,400,000		1,512,434
Cook County Gen. Oblig. Series C, 5% 11/15/25 (AMBAC Insured)	1,100,000		1,157,827
DuPage County Cmnty. High School District #108, Lake Park 5.6% 1/1/17 (FSA Insured)	3,190,000		3,526,577
Evanston Gen. Oblig. Series C, 5.25% 1/1/20	1,500,000		1,611,900
Granite City Solid Waste Disp. Rev. (Waste Mgmt., Inc. Proj.) 3.85%, tender 5/1/08 (c)(d)	2,810,000		2,783,080
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Illinois - continued
Illinois Dev. Fin. Auth. Retirement 0% 7/15/23 (Escrowed to Maturity) (e)	$ 2,900,000		$ 1,386,925
Illinois Edl. Facilities Auth. Revs. (Northwestern Univ. Proj.) 5% 12/1/38	900,000		939,735
Illinois Gen. Oblig.:
First Series, 5.75% 12/1/18 (MBIA Insured)	1,000,000		1,075,330
Series 2006, 5.5% 1/1/31	1,000,000		1,218,560
5.5% 4/1/17 (MBIA Insured)	1,000,000		1,056,820
5.6% 4/1/21 (MBIA Insured)	1,000,000		1,057,700
Illinois Health Facilities Auth. Rev.:
(Condell Med. Ctr. Proj.) 6.5% 5/15/30	3,000,000		3,203,340
(Decatur Memorial Hosp. Proj.) Series 2001, 5.75% 10/1/24	2,100,000		2,211,594
(Lake Forest Hosp. Proj.) 6% 7/1/33	1,000,000		1,081,850
(Riverside Health Sys. Proj.) 6.8% 11/15/20 (Pre-Refunded to 11/15/10 @ 101) (e)	1,500,000		1,692,885
Illinois Sales Tax Rev.:
First Series 2001, 5.5% 6/15/13	3,250,000		3,503,175
6% 6/15/20	600,000		646,074
Joliet School District #86 Gen. Oblig. Cap. Appreciation 0% 11/1/19 (FSA Insured)	2,000,000		1,160,920
Kane, McHenry, Cook & DeKalb Counties Cmnty. Unit School District #300, Carpentersville 0% 12/1/17 (AMBAC Insured)	1,000,000		632,500
Lake County Cmnty. High School District #117, Antioch Series B, 0% 12/1/20 (FGIC Insured)	1,805,000		994,411
Lake County Warren Township High School District #121, Gurnee Series C, 5.5% 3/1/23 (AMBAC Insured)	1,795,000		1,998,445
Metropolitan Pier & Exposition Auth. Dedicated State Tax Rev. (McCormick Place Expansion Proj.):
Series 2002 A, 5.75% 6/15/41 (MBIA Insured)	3,300,000		3,617,691
Series A:
0% 6/15/16 (FGIC Insured)	2,370,000		1,613,235
0% 6/15/19 (MBIA Insured)	3,710,000		2,198,657
0% 6/15/22 (MBIA Insured)	1,060,000		546,292
0% 12/15/24 (MBIA Insured)	3,090,000		1,422,049
Ogle, Lee & DeKalb Counties Township High School District #212 6% 12/1/16 (MBIA Insured)	60,000		66,304
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Illinois - continued
Univ. of Illinois Auxiliary Facilities Sys. Rev. 0% 4/1/15 (MBIA Insured)	$ 3,700,000		$ 2,653,899
Will County Forest Preservation District Series B, 0% 12/1/14 (FGIC Insured)	1,000,000		729,660
			67,620,537
Indiana - 3.4%
Crown Point Multi-School Bldg. Corp. 5% 1/15/20 (FGIC Insured)	1,260,000		1,353,656
Franklin Township Independent School Bldg. Corp., Marion County 5.25% 7/15/16 (MBIA Insured)	1,790,000		1,980,653
Hamilton Heights School Bldg. Corp. 5.25% 7/15/17 (FSA Insured)	1,910,000		2,131,923
Hobart Bldg. Corp. 6.5% 1/15/29 (FGIC Insured)	2,600,000		3,246,178
Indiana Health & Edl. Facilities Fing. Auth. Hosp. Rev. (Clarian Health Partners, Inc. Proj.) Series B, 5% 2/15/11	1,500,000		1,572,870
Indiana Health Facility Fing. Auth. Rev. (Sisters of Saint Francis Health Svc. Proj.) 5.5% 11/1/31 (Pre-Refunded to 11/1/11 @ 101) (e)	1,500,000		1,646,820
Indiana Trans. Fin. Auth. Hwy. Series A, 0% 6/1/17 (AMBAC Insured)	1,000,000		646,260
Indiana Univ. Student Fee Revs. Series H, 0% 8/1/09 (AMBAC Insured)	1,600,000		1,442,960
Indianapolis Local Pub. Impt. Bond Bank (Indianapolis Arpt. Auth. Proj.) Series 2006 F, 5% 1/1/16 (AMBAC Insured) (d)	1,000,000		1,074,430
North Adams Cmnty. Schools Renovation Bldg. Corp. 0% 1/15/17 (FSA Insured)	1,230,000		806,585
Petersburg Poll. Cont. Rev. 5.95% 12/1/29 (d)	2,000,000		2,142,760
Portage Township Multi-School Bldg. Corp. 5.25% 7/15/26 (MBIA Insured)	1,195,000		1,295,547
Rockport Poll. Cont. Rev. (AEP Generating Co. Proj.) Series 1995 A, 4.15%, tender 7/15/11 (AMBAC Insured) (c)	1,000,000		1,020,940
South Harrison School Bldg. Corp. Series A, 5.25% 1/15/25 (FSA Insured)	1,150,000		1,248,751
			21,610,333
Iowa - 0.7%
Tobacco Settlement Auth. Tobacco Settlement Rev. 5.3% 6/1/25 (Pre-Refunded to 6/1/11 @ 101) (e)	4,000,000		4,263,440
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Kansas - 1.8%
Burlington Envir. Impt. Rev. (Kansas City Pwr. & Lt. Co. Proj.) Series A, 4.75%, tender 10/1/07 (c)	$ 1,000,000		$ 1,008,840
Kansas Dev. Fin. Auth. Health Facilities Rev.:
(Hays Med. Ctr. Proj.) Series 2005 L:
5.25% 11/15/15	335,000		363,833
5.25% 11/15/16	955,000		1,037,197
(Sisters of Charity of Leavenworth Health Svcs. Corp. Proj.) Series J, 6.25% 12/1/28	1,500,000		1,642,290
Kansas Dev. Fin. Auth. Rev. (Sisters of Charity of Leavenworth Health Svcs. Corp. Proj.):
5% 12/1/13 (MBIA Insured)	2,390,000		2,456,346
5% 12/1/14 (MBIA Insured)	500,000		513,880
5.25% 12/1/09 (MBIA Insured)	1,420,000		1,467,016
5.25% 12/1/11 (MBIA Insured)	1,750,000		1,807,120
Lawrence Hosp. Rev. 5.25% 7/1/18	1,000,000		1,085,100
			11,381,622
Kentucky - 0.4%
Louisville & Jefferson County Metropolitan Swr. District Swr. & Drain Sys. Rev. Series A, 5.25% 5/15/37 (FGIC Insured)	2,170,000		2,356,577
Louisiana - 0.4%
Louisiana Military Dept. 5% 8/1/14	1,730,000		1,825,271
New Orleans Gen. Oblig. 0% 9/1/15 (AMBAC Insured)	700,000		480,410
Tobacco Settlement Fing. Corp. Series 2001 B, 5.5% 5/15/30	420,000		440,467
			2,746,148
Maine - 0.2%
Maine Tpk. Auth. Tpk. Rev. 5.25% 7/1/30 (FSA Insured)	1,000,000		1,081,040
Maryland - 0.5%
Maryland Health & Higher Edl. Facilities Auth. Rev. (Good Samaritan Hosp. Proj.):
5.75% 7/1/13 (Escrowed to Maturity) (e)	1,665,000		1,821,294
5.75% 7/1/13 (Escrowed to Maturity) (e)	1,015,000		1,110,278
			2,931,572
Massachusetts - 3.6%
Massachusetts Gen. Oblig.:
Series 2005 C, 5.25% 9/1/23 (Pre-Refunded to 9/1/15 @ 100) (e)	2,800,000		3,130,876
Series D, 5.25% 10/1/22 (Pre-Refunded to 10/1/13 @ 100) (e)	1,200,000		1,312,476
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Massachusetts - continued
Massachusetts Health & Edl. Facilities Auth. Rev. (New England Med. Ctr. Hosp. Proj.) Series G, 5.375% 7/1/24 (MBIA Insured)	$ 500,000		$ 500,305
Massachusetts Indl. Fin. Agcy. Rev. (Massachusetts Biomedical Research Corp. Proj.) Series A2:
0% 8/1/08	800,000		749,928
0% 8/1/10	4,500,000		3,879,765
Massachusetts School Bldg. Auth. Dedicated Sales Tax Rev. Series A:
5% 8/15/23 (FSA Insured)	5,000,000		5,351,650
5% 8/15/30 (FSA Insured)	4,500,000		4,772,070
Massachusetts Wtr. Poll. Abatement Trust Wtr. Poll. Abatement Rev. (MWRA Ln. Prog.) Series A, 5.25% 8/1/13	10,000		10,373
Springfield Gen. Oblig. 5% 8/1/20 (MBIA Insured)	3,335,000		3,581,390
			23,288,833
Michigan - 1.1%
Ferris State Univ. Rev. 5% 10/1/19 (MBIA Insured)	1,440,000		1,535,774
Michigan Hosp. Fin. Auth. Hosp. Rev. (McLaren Health Care Corp. Proj.) Series A, 5% 6/1/19	2,000,000		2,052,100
Royal Oak Hosp. Fin. Auth. Hosp. Rev. (William Beaumont Hosp. Proj.) 6.25% 1/1/09	2,310,000		2,427,186
Willow Run Cmnty. Schools County of Washtenaw 5% 5/1/20 (FSA Insured)	1,000,000		1,067,700
			7,082,760
Minnesota - 1.7%
Minneapolis & Saint Paul Hsg. & Redev. Auth. Health Care Sys. Rev. (Healthspan Corp. Proj.) Series A, 4.75% 11/15/18 (AMBAC Insured)	1,800,000		1,800,918
Minneapolis & Saint Paul Metropolitan Arpts. Commission Arpt. Rev. Series 2001 C, 5.25% 1/1/32 (FGIC Insured)	1,000,000		1,052,520
Minneapolis Health Care Sys. Rev. (Allina Health Sys. Proj.) Series 2002 A, 6% 11/15/23	1,000,000		1,105,130
North St. Paul-Maplewood-Oakdale Independent School District 622 5% 2/1/15 (FSA Insured) (b)	1,425,000		1,552,352
Rochester Health Care Facilities Rev. (Mayo Foundation Proj.) Series A, 5.5% 11/15/27	590,000		612,426
Saint Cloud Health Care Rev. (Saint Cloud Hosp. Group Oblig. Proj.) Series A, 5.875% 5/1/30 (FSA Insured)	2,000,000		2,148,740
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Minnesota - continued
Saint Paul Port Auth. Lease Rev.:
(HealthEast Midway Campus Proj.) Series 2003 A, 5.875% 5/1/30	$ 1,400,000		$ 1,463,854
Series 2003 11, 5.25% 12/1/18	1,000,000		1,082,760
			10,818,700
Missouri - 0.2%
Missouri Envir. Impt. & Energy Resources Auth. Wtr. Poll. Cont. & Drinking Wtr. Rev. (State Revolving Fund Prog.) Series 2003 A, 5.125% 1/1/21	1,010,000		1,081,700
Montana - 0.4%
Forsyth Poll. Cont. Rev. (Portland Gen. Elec. Co. Proj.) Series A, 5.2%, tender 5/1/09 (c)	1,500,000		1,537,350
Montana Board of Regents Higher Ed. Rev. (Montana State Univ. Proj.) 5% 11/15/34 (AMBAC Insured)	1,000,000		1,058,950
			2,596,300
Nevada - 0.5%
Clark County Arpt. Rev. Series C, 5.375% 7/1/22 (AMBAC Insured) (d)	1,000,000		1,065,800
Las Vegas Valley Wtr. District Series B:
5.25% 6/1/16 (MBIA Insured)	1,000,000		1,083,640
5.25% 6/1/17 (MBIA Insured)	1,000,000		1,080,820
			3,230,260
New Hampshire - 0.2%
New Hampshire Bus. Fin. Auth. Poll. Cont. Rev. (United Illumination Co.) Series A, 3.65%, tender 2/1/10 (AMBAC Insured) (c)(d)	1,000,000		987,610
New Jersey - 2.9%
New Jersey Econ. Dev. Auth. Rev. Series 2005 O:
5.25% 3/1/21 (MBIA Insured)	1,000,000		1,092,180
5.25% 3/1/23	2,000,000		2,168,100
5.25% 3/1/25	1,500,000		1,621,680
5.25% 3/1/26	915,000		988,548
New Jersey Tpk. Auth. Tpk. Rev. Series A, 5% 1/1/25 (FSA Insured)	900,000		960,156
New Jersey Trans. Trust Fund Auth. Series B, 5.25% 12/15/22 (AMBAC Insured)	400,000		457,928
Tobacco Settlement Fing. Corp.:
4.375% 6/1/19	1,990,000		1,991,294
6.125% 6/1/24	3,500,000		3,797,535
6.125% 6/1/42	1,600,000		1,740,560
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
New Jersey - continued
Tobacco Settlement Fing. Corp.: - continued
6.375% 6/1/32	$ 1,400,000		$ 1,562,246
6.75% 6/1/39	835,000		954,672
Union County Impt. Auth. (Juvenile Detention Ctr. Facility Proj.) 5.5% 5/1/28 (FGIC Insured)	1,000,000		1,111,690
			18,446,589
New Mexico - 1.2%
Albuquerque Arpt. Rev.:
6.7% 7/1/18 (AMBAC Insured) (d)	3,970,000		4,116,334
6.75% 7/1/09 (AMBAC Insured) (d)	450,000		481,617
6.75% 7/1/11 (AMBAC Insured) (d)	1,805,000		2,006,745
New Mexico Edl. Assistance Foundation Student Ln. Rev. Series IV A2, 6.65% 3/1/07	1,000,000		1,009,580
			7,614,276
New York - 12.0%
Erie County Indl. Dev. Agcy. School Facility Rev. (Buffalo City School District Proj.):
Series 2003:
5.75% 5/1/16 (FSA Insured)	1,500,000		1,675,170
5.75% 5/1/21 (FSA Insured)	1,200,000		1,318,800
Series 2004:
5.75% 5/1/21 (FSA Insured)	4,900,000		5,552,239
5.75% 5/1/25 (FSA Insured)	600,000		676,098
Long Island Pwr. Auth. Elec. Sys. Rev. 5% 12/1/26 (XL Cap. Assurance, Inc. Insured)	1,400,000		1,495,494
Metropolitan Trans. Auth. Rev.:
Series A, 5.75% 11/15/32	4,300,000		4,738,514
Series F, 5.25% 11/15/27 (MBIA Insured)	500,000		539,315
Metropolitan Trans. Auth. Svc. Contract Rev. Series 7, 5.625% 7/1/16 (Escrowed to Maturity) (e)	1,000,000		1,000,800
New York City Gen. Oblig.:
Series 2005 G:
5% 8/1/14	3,600,000		3,889,764
5% 8/1/15	1,000,000		1,086,190
Series A, 5.25% 11/1/14 (MBIA Insured)	600,000		649,908
Series C, 5.75% 3/15/27 (Pre-Refunded to 3/15/12 @ 100) (e)	135,000		149,669
Series J, 5.5% 6/1/19	1,100,000		1,206,557
Subseries 2005 F1, 5.25% 9/1/14	1,200,000		1,317,648
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
New York - continued
New York City Indl. Dev. Agcy. Indl. Dev. Rev. (Japan Airlines Co. Ltd. Proj.) Series 1991, 6% 11/1/15 (FSA Insured) (d)	$ 705,000		$ 712,826
New York City Indl. Dev. Agcy. Spl. Facilities Rev. (Terminal One Group Assoc. Proj.) 5% 1/1/09 (d)	1,000,000		1,021,080
New York City Muni. Wtr. Fin. Auth. Wtr. & Swr. Sys. Rev.:
Series 2002 A, 5.125% 6/15/34 (FSA Insured)	500,000		527,250
Series A, 5.125% 6/15/34 (MBIA Insured)	2,000,000		2,109,000
Series E, 5% 6/15/34	1,600,000		1,671,328
New York City Trust Cultural Resources Rev. (Museum of Modern Art Proj.) Series 2001 D, 5.125% 7/1/31 (AMBAC Insured)	1,000,000		1,060,070
New York State Dorm. Auth. Revs.:
(City Univ. Sys. Consolidation Proj.):
Series A, 5.75% 7/1/13	1,500,000		1,640,955
Series C, 7.5% 7/1/10	360,000		386,741
(The Jamaica Hosp. Proj.) Series F, 5.2% 2/15/14 (MBIA Insured)	3,950,000		4,087,974
Series 2002 A, 5.75% 10/1/17 (MBIA Insured)	1,000,000		1,105,120
New York State Envir. Facilities Corp. Clean Wtr. & Drinking Wtr. Rev. Series F:
4.875% 6/15/18	870,000		894,203
4.875% 6/15/20	795,000		815,980
5% 6/15/15	305,000		314,418
New York State Thruway Auth. Gen. Rev. Series 2005 G, 5.25% 1/1/27 (FSA Insured)	1,600,000		1,753,696
New York State Thruway Auth. Svc. Contract Rev. 5.5% 4/1/16	305,000		332,157
New York Transitional Fin. Auth. Rev.:
Series 2004 C, 5% 2/1/33 (FGIC Insured)	1,000,000		1,057,140
Series A:
5.75% 2/15/16	10,000		10,784
6% 11/1/28 (a)	2,000,000		2,207,060
Series B:
5% 8/1/32	1,300,000		1,364,350
5.25% 2/1/29 (a)	2,000,000		2,122,240
Sales Tax Asset Receivables Corp. Series A, 5.25% 10/15/27 (AMBAC Insured)	1,500,000		1,634,040
Tobacco Settlement Asset Securitization Corp. Series 1, 5.5% 7/15/24 (Pre-Refunded to 7/15/12 @ 100) (e)	1,155,000		1,240,597
Tobacco Settlement Fing. Corp.:
Series 2003 C1, 5.5% 6/1/19	1,400,000		1,537,326
Series A1:
5.25% 6/1/21 (AMBAC Insured)	1,000,000		1,077,630
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
New York - continued
Tobacco Settlement Fing. Corp.: - continued
Series A1:
5.25% 6/1/22 (AMBAC Insured)	$ 950,000		$ 1,022,609
5.5% 6/1/14	1,200,000		1,256,220
5.5% 6/1/16	4,700,000		4,985,760
Series C1:
5.5% 6/1/14	400,000		418,740
5.5% 6/1/15	1,700,000		1,803,360
5.5% 6/1/16	1,000,000		1,076,440
5.5% 6/1/17	1,300,000		1,396,538
5.5% 6/1/18	1,800,000		1,956,222
5.5% 6/1/21	5,000,000		5,469,150
5.5% 6/1/22	1,500,000		1,638,015
			77,003,185
New York & New Jersey - 0.3%
Port Auth. of New York & New Jersey 124th Series, 5% 8/1/13 (FGIC Insured) (d)	500,000		513,660
Port Auth. of New York & New Jersey Spl. Oblig. Rev. (JFK Int'l. Air Term. Spl. Proj.) Series 6, 6.25% 12/1/13 (MBIA Insured) (d)	1,400,000		1,604,526
			2,118,186
North Carolina - 2.5%
Charlotte Ctfs. of Prtn. (2003 Govt. Facilities Projs.) Series G, 5% 6/1/33	1,000,000		1,043,190
Dare County Ctfs. of Prtn. 5.25% 6/1/15 (AMBAC Insured)	1,195,000		1,310,604
North Carolina Cap. Facilities Fin. Agcy. Rev. (Duke Univ. Proj.) Series A:
5.125% 10/1/41	1,745,000		1,820,611
5.125% 7/1/42	5,155,000		5,415,895
5.25% 7/1/42	1,300,000		1,377,727
North Carolina Eastern Muni. Pwr. Agcy. Pwr. Sys. Rev.:
Series A, 5.5% 1/1/11	1,575,000		1,669,595
Series D, 6.7% 1/1/19	1,115,000		1,218,539
North Carolina Infrastructure Fin. Corp. Ctfs. of Prtn. (North Carolina Correctional Facilities Proj.) Series A, 5% 2/1/18	1,000,000		1,064,880
Union County Ctfs. Prtn. 5% 6/1/18 (AMBAC Insured) (b)	1,305,000		1,412,271
			16,333,312
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
North Dakota - 0.2%
Ward County Health Care Facility Rev. (Trinity Med. Ctr. Proj.) 5.125% 7/1/17 (b)	$ 1,210,000		$ 1,290,138
Ohio - 0.5%
Cincinnati Student Ln. Fdg. Corp. Student Ln. Rev. Series B, 8.875% 8/1/08 (d)	1,005,000		1,007,121
Franklin County Hosp. Rev. 5.5% 5/1/21 (Pre-Refunded to 5/1/11 @ 101) (e)	1,500,000		1,634,640
Plain Local School District 6% 12/1/25 (FGIC Insured)	410,000		448,278
			3,090,039
Oklahoma - 1.6%
Oklahoma City Pub. Property Auth. Hotel Tax Rev.:
5.25% 10/1/29 (FGIC Insured)	1,000,000		1,092,110
5.5% 10/1/21 (FGIC Insured)	1,695,000		1,893,383
Oklahoma Industries Auth. Rev. (Health Sys. Oblig. Group Proj.) Series A:
5.75% 8/15/29 (MBIA Insured)	865,000		912,186
6% 8/15/19 (MBIA Insured)	1,740,000		1,859,086
6% 8/15/19 (Pre-Refunded to 8/15/09 @ 101) (e)	1,260,000		1,350,040
Tulsa Indl. Auth. Rev. (Univ. of Tulsa Proj.) Series 2000 A, 5.75% 10/1/25 (Pre-Refunded to 10/1/10 @ 100) (e)	3,000,000		3,241,200
			10,348,005
Oregon - 0.5%
Oregon Dept. Administrative Svcs. Ctfs. of Prtn. Series A, 5.375% 5/1/15 (AMBAC Insured)	1,715,000		1,865,320
Yamhill County School District #029J Newberg 5.5% 6/15/19 (FGIC Insured)	1,000,000		1,158,200
			3,023,520
Pennsylvania - 3.1%
Annville-Cleona School District 5.5% 3/1/22 (FSA Insured)	1,250,000		1,399,463
Canon McMillan School District:
Series 2001 B, 5.75% 12/1/33 (FGIC Insured)	1,000,000		1,074,160
Series 2002 B, 5.75% 12/1/35 (FGIC Insured)	1,595,000		1,751,438
Delaware County Auth. College Rev. (Haverford College Proj.) 5.75% 11/15/29	3,500,000		3,770,760
Easton Area School District Series 2006, 7.75% 4/1/25 (FSA Insured)	700,000		911,848
Montgomery County Higher Ed. & Health Auth. Hosp. Rev. (Abington Memorial Hosp. Proj.) Series A, 6% 6/1/16 (AMBAC Insured)	1,860,000		2,169,634
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Pennsylvania - continued
Pennsylvania Econ. Dev. Fing. Auth. Exempt Facilities Rev.:
(Amtrak Proj.) Series 2001 A, 6.25% 11/1/31 (d)	$ 2,000,000		$ 2,174,360
(Shippingport Proj.) Series A, 4.35%, tender 6/1/10 (c)(d)	500,000		501,795
Pennsylvania Higher Edl. Facilities Auth. Rev. (Lafayette College Proj.) 6% 5/1/30	3,065,000		3,286,814
Westmoreland County Muni. Auth. Muni. Svc. Rev. Series A, 0% 8/15/21 (FGIC Insured)	5,000,000		2,661,900
			19,702,172
Puerto Rico - 0.7%
Puerto Rico Govt. Dev. Bank:
Series B, 5% 12/1/12	2,500,000		2,647,450
Series C, 5.25% 1/1/15 (d)	1,000,000		1,071,140
5% 12/1/10	1,000,000		1,042,990
			4,761,580
Rhode Island - 0.9%
Rhode Island Health & Edl. Bldg. Corp. Rev. Series A, 5.25% 9/15/17 (AMBAC Insured)	1,000,000		1,089,940
Rhode Island Port Auth. & Econ. Dev. Corp. Arpt. Rev. Series A, 7% 7/1/14 (FSA Insured) (d)	4,000,000		4,539,440
			5,629,380
South Carolina - 1.4%
Greenville County School District Installment Purp. Rev. 5% 12/1/12	3,750,000		3,998,363
Lexington One School Facilities Corp. Rev. (Lexington County School District No. 1 Proj.) 5% 12/1/17	1,015,000		1,091,501
South Carolina Jobs Econ. Dev. Auth. Hosp. Facilities Rev. (Palmetto Health Alliance Proj.) Series A, 7.375% 12/15/21 (Pre-Refunded to 12/15/10 @ 102) (e)	1,000,000		1,157,110
South Carolina Pub. Svc. Auth. Rev.:
(Santee Cooper Proj.) Series 2005 B, 5% 1/1/18 (MBIA Insured)	1,000,000		1,087,220
Series A, 5.5% 1/1/16 (FGIC Insured)	1,000,000		1,134,570
Tobacco Settlement Rev. Mgmt. Auth. Series 2001 B, 6.375% 5/15/28	545,000		587,690
			9,056,454
Tennessee - 0.9%
Clarksville Natural Gas Acquisition Corp. Gas Rev.:
5% 12/15/13	1,000,000		1,069,670
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Tennessee - continued
Clarksville Natural Gas Acquisition Corp. Gas Rev.: - continued
5% 12/15/15	$ 1,500,000		$ 1,620,720
5% 12/15/16	1,500,000		1,625,025
Shelby County Health Edl. & Hsg. Facility Board Hosp. Rev. (Methodist Hosp. Proj.) 6.5% 9/1/26 (Pre-Refunded to 9/1/12 @ 100) (e)	1,120,000		1,288,672
			5,604,087
Texas - 13.2%
Abilene Independent School District 5% 2/15/19	1,090,000		1,169,330
Aledo Independent School District Series A, 5.125% 2/15/33	1,000,000		1,060,490
Austin Cmnty. College District 5.5% 8/1/34	1,000,000		1,106,700
Austin Util. Sys. Rev. 0% 11/15/12 (AMBAC Insured)	1,300,000		1,035,879
Boerne Independent School District 5.25% 2/1/35	1,500,000		1,600,905
Canyon Independent School District Series A, 5.5% 2/15/18	1,575,000		1,735,335
Corpus Christi Util. Sys. Rev. 5.25% 7/15/18 (FSA Insured)	1,000,000		1,116,190
Corsicana Independent School District 5.125% 2/15/28	1,015,000		1,080,051
Cypress-Fairbanks Independent School District Series A:
0% 2/15/14	3,200,000		2,411,872
0% 2/15/16	1,400,000		966,644
Dallas Fort Worth Int'l. Arpt. Rev. Series A, 5.25% 11/1/12 (MBIA Insured) (d)	1,000,000		1,069,890
Denton Independent School District 5% 8/15/33 (b)	1,600,000		1,660,864
Fort Worth Wtr. & Swr. Rev. 5% 2/15/16 (FSA Insured)	1,000,000		1,075,670
Garland Independent School District 5.5% 2/15/19	2,500,000		2,641,750
Grand Prairie Independent School District 5.375% 2/15/16 (FSA Insured)	1,000,000		1,091,910
Guadalupe-Blanco River Auth. Contract Rev. (Western Canyon Reg'l. Wtr. Supply Proj.) 5.25% 4/15/20 (MBIA Insured)	1,000,000		1,076,900
Harris County Gen. Oblig.:
Series A, 5.25% 8/15/35 (FSA Insured)	1,600,000		1,687,296
0% 10/1/17 (MBIA Insured)	2,500,000		1,607,250
0% 8/15/24 (MBIA Insured)	1,000,000		461,980
Harris County Health Facilities Dev. Corp. Rev. (Saint Luke's Episcopal Hosp. Proj.):
Series 2001 A, 5.5% 2/15/12 (Pre-Refunded to 8/15/11 @ 100) (e)	1,000,000		1,082,290
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Texas - continued
Harris County Health Facilities Dev. Corp. Rev. (Saint Luke's Episcopal Hosp. Proj.): - continued
5.75% 2/15/21 (Pre-Refunded to 8/15/12 @ 100) (e)	$ 1,310,000		$ 1,452,908
Hays Consolidated Independent School District Series A, 5.125% 8/15/30	1,000,000		1,065,780
Houston Arpt. Sys. Rev.:
Series A, 5.625% 7/1/19 (FSA Insured) (d)	1,000,000		1,078,910
Series B, 5.5% 7/1/30 (FSA Insured)	1,400,000		1,483,006
Houston Independent School District 0% 8/15/13	1,300,000		1,000,363
Humble Independent School District:
Series 2005 B, 5.25% 2/15/20 (FGIC Insured)	1,800,000		1,970,496
0% 2/15/17	1,000,000		661,450
Hurst Euless Bedford Independent School District 0% 8/15/11	1,000,000		834,830
Lewisville Independent School District 0% 8/15/19	2,340,000		1,373,767
Lower Colorado River Auth. Transmission Contract Rev. (LCRA Transmission Services Corp. Proj.) Series C, 5.25% 5/15/19 (AMBAC Insured)	1,000,000		1,081,930
Mansfield Independent School District:
5.375% 2/15/26	1,000,000		1,068,650
5.5% 2/15/17	2,000,000		2,175,720
Mesquite Independent School District 3.65%, tender 12/1/08 (Liquidity Facility JPMorgan Chase Bank) (c)	1,000,000		1,000,000
Montgomery County Muni. Util. District #46 5% 3/1/21 (FSA Insured)	1,040,000		1,083,836
North Central Health Facilities Dev. Corp. Rev. (Children's Med. Ctr. of Dallas Proj.) 5.5% 8/15/16 (AMBAC Insured)	1,230,000		1,340,774
Northside Independent School District 5.5% 2/15/15	940,000		1,008,329
Northwest Texas Independent School District 5.5% 8/15/21	3,185,000		3,503,373
Sabine River Auth. Poll. Cont. Rev. (Texas Utils. Elec. Co. Proj.) Series B, 5.75%, tender 11/1/11 (c)(d)	4,645,000		4,931,086
San Antonio Elec. & Gas Sys. Rev. 5.5% 2/1/20 (Pre-Refunded to 2/1/07 @ 101) (e)	75,000		76,093
San Marcos Consolidated Independent School District:
5% 8/1/20	1,525,000		1,625,604
5.125% 8/1/29 (Pre-Refunded to 8/1/14 @ 100) (e)	1,900,000		2,084,794
Southwest Higher Ed. Auth. Rev. (Southern Methodist Univ. Proj.) 5.5% 10/1/14 (AMBAC Insured)	2,245,000		2,458,657
Spring Branch Independent School District 5.375% 2/1/18	1,000,000		1,066,390
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Texas - continued
Tarrant County Health Facilities Dev. Corp. Hosp. Rev. 5.375% 11/15/20 (Pre-Refunded to 11/15/08 @ 101) (e)	$ 1,000,000		$ 1,044,190
Texas Muni. Pwr. Agcy. Rev.:
0% 9/1/11 (AMBAC Insured)	4,715,000		3,946,408
0% 9/1/11 (Escrowed to Maturity) (e)	35,000		29,239
0% 9/1/15 (MBIA Insured)	1,100,000		778,140
Texas Pub. Fin. Auth. Bldg. Rev. (Texas Technical College Proj.) 6.25% 8/1/09 (MBIA Insured)	640,000		665,248
Texas Tpk. Auth. Central Tpk. Sys. Rev.:
5.5% 8/15/39 (AMBAC Insured)	4,050,000		4,371,489
5.75% 8/15/38 (AMBAC Insured)	3,775,000		4,135,248
Texas Wtr. Dev. Board Rev. Series A, 5.5% 7/15/21	1,000,000		1,046,580
Travis County Health Facilities Dev. Corp. Rev. (Ascension Health Cr. Prog.) Series A, 6.25% 11/15/19 (Pre-Refunded to 11/15/09 @ 101) (e)	4,000,000		4,337,880
Tyler Health Facilities Dev. Corp. Hosp. Rev. (Mother Frances Hosp. Reg'l. Health Care Ctr. Proj.) 6% 7/1/27	1,000,000		1,080,900
White Settlement Independent School District 5.75% 8/15/34	1,440,000		1,581,336
Williamson County Gen. Oblig. 5.5% 2/15/19 (FSA Insured)	35,000		37,501
			85,220,101
Utah - 0.3%
Intermountain Pwr. Agcy. Pwr. Supply Rev.:
Series A:
6.5% 7/1/09 (AMBAC Insured)	365,000		391,324
6.5% 7/1/09 (Escrowed to Maturity) (e)	635,000		682,631
Series B, 5.75% 7/1/16 (MBIA Insured)	1,025,000		1,059,163
			2,133,118
Vermont - 0.4%
Vermont Edl. & Health Bldg. Fing. Agcy. Rev.:
(Fletcher Allen Health Care, Inc. Proj.):
Series 2000 A, 6.125% 12/1/27 (AMBAC Insured)	1,000,000		1,092,040
Series A, 5.75% 12/1/18 (AMBAC Insured)	400,000		432,152
(Middlebury College Proj. Series A, 5% 10/31/46	1,000,000		1,053,060
			2,577,252
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Washington - 7.1%
Chelan County Pub. Util. District #1 Columbia River-Rock Island Hydro-Elec. Sys. Rev. Series A:
0% 6/1/17 (MBIA Insured)	$ 1,000,000		$ 641,590
0% 6/1/29 (MBIA Insured)	2,000,000		727,440
Clark County School District #114, Evergreen 5.375% 12/1/14 (FSA Insured)	3,040,000		3,308,797
Energy Northwest Elec. Rev. (#1 Proj.) Series 2006 A, 5% 7/1/15	1,000,000		1,087,810
Grant County Pub. Util. District #2 (Priest Rapids Hydro-Elec. Proj.) Second Series B, 5.375% 1/1/16 (MBIA Insured) (d)	1,715,000		1,809,874
Grant County Pub. Util. District #2 Wanapum Hydro Elec. Rev. Series B, 5.25% 1/1/22 (FGIC Insured) (d)	1,950,000		2,067,995
King County Swr. Rev. Series B, 5.125% 1/1/33 (FSA Insured)	2,800,000		2,936,612
Port of Seattle Passenger Facilities Charge Rev. Series B, 5.25% 12/1/14 (AMBAC Insured) (d)	3,000,000		3,114,990
Spokane County School District #81 5.25% 12/1/18 (FSA Insured)	1,000,000		1,082,450
Spokane Gen. Oblig. 5.25% 12/1/24 (AMBAC Insured)	1,000,000		1,080,510
Spokane Pub. Facilities District Hotel/Motel Tax & Sales/Use Tax Rev. 5.75% 12/1/24 (MBIA Insured)	1,000,000		1,112,830
Tumwater School District #33, Thurston County Series 1996 B, 0% 12/1/10 (FGIC Insured)	4,000,000		3,433,560
Washington Gen. Oblig.:
Series 2001 C, 5.25% 1/1/16	1,000,000		1,065,180
Series C, 5.25% 1/1/26 (FSA Insured)	1,000,000		1,061,600
Series R 97A, 0% 7/1/19 (MBIA Insured)	1,200,000		701,100
Washington Health Care Facilities Auth. Rev. (Providence Health Systems Proj.) Series 2001 A, 5.5% 10/1/13 (MBIA Insured)	3,000,000		3,238,980
Washington Pub. Pwr. Supply Sys. Nuclear Proj. #2 Rev. 5.4% 7/1/12	16,000,000		17,385,430
			45,856,748
Wisconsin - 1.3%
Badger Tobacco Asset Securitization Corp. 6.125% 6/1/27	845,000		907,099
Douglas County Gen. Oblig. 5.5% 2/1/18 (FGIC Insured)	335,000		362,236
Menasha Joint School District:
5.5% 3/1/17 (FSA Insured)	65,000		70,216
5.5% 3/1/17 (Pre-Refunded to 3/1/12 @ 100) (e)	1,095,000		1,187,538
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Wisconsin - continued
Wisconsin Health & Edl. Facilities Auth. Rev.:
(Marshfield Clinic Proj.) Series B, 6% 2/15/25	$ 1,500,000		$ 1,616,325
(Wheaton Franciscan Svcs., Inc. Proj.):
Series A, 5.5% 8/15/16	1,000,000		1,075,980
5.75% 8/15/30	1,500,000		1,619,595
6.25% 8/15/22	600,000		669,120
Series A, 5.375% 2/15/34	1,000,000		1,060,280
			8,568,389
TOTAL INVESTMENT PORTFOLIO - 99.3% (Cost $614,228,591)			638,994,162
NET OTHER ASSETS - 0.7%			4,807,732
NET ASSETS - 100%		$ 643,801,894

Legend

(a) Security initially issued at one coupon which converts to a higher coupon at a specified date. The rate shown is the rate at period end.

(b) Security or a portion of the security purchased on a delayed delivery or when-issued basis.

(d) Private activity obligations whose interest is subject to the federal alternative minimum tax for individuals.

(e) Security collateralized by an amount sufficient to pay interest and principal.

Other Information

The distribution of municipal securities by revenue source, as a percentage of total net assets, is as follows:

General Obligations	37.8%
Health Care	11.0%
Electric Utilities	9.2%
Transportation	8.9%
Escrowed/Pre-Refunded	7.7%
Water & Sewer	7.4%
Special Tax	6.5%
Education	5.8%
Others* (individually less than 5%)	5.7%
	100.0%

*Includes net other assets

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Statements

Statement of Assets and Liabilities

	October 31, 2006

Assets
Investment in securities, at value - See accompanying schedule: Unaffiliated issuers (cost $614,228,591)		$ 638,994,162
Cash		5,632,835
Receivable for investments sold		682,593
Receivable for fund shares sold		911,300
Interest receivable		9,437,418
Other receivables		21,626
Total assets		655,679,934

Liabilities
Payable for investments purchased Regular delivery	$ 856,460
Delayed delivery	9,092,667
Payable for fund shares redeemed	713,398
Distributions payable	724,222
Accrued management fee	196,680
Distribution fees payable	182,418
Other affiliated payables	72,676
Other payables and accrued expenses	39,519
Total liabilities		11,878,040

Net Assets		$ 643,801,894
Net Assets consist of:
Paid in capital		$ 613,879,528
Distributions in excess of net investment income		(193,440)
Accumulated undistributed net realized gain (loss) on investments		5,350,235
Net unrealized appreciation (depreciation) on investments		24,765,571
Net Assets		$ 643,801,894

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Statements - continued

Statement of Assets and Liabilities - continued

	October 31, 2006

Calculation of Maximum Offering Price Class A: Net Asset Value and redemption price per share ($144,183,000 ÷ 11,094,124 shares)		$ 13.00

Maximum offering price per share (100/95.25 of $13.00)		$ 13.65
Class T: Net Asset Value and redemption price per share ($310,132,270 ÷ 23,810,705 shares)		$ 13.02

Maximum offering price per share (100/96.50 of $13.02)		$ 13.49
Class B: Net Asset Value and offering price per share ($65,114,188 ÷ 5,021,595 shares)^A		$ 12.97

Class C: Net Asset Value and offering price per share ($62,799,018 ÷ 4,823,765 shares)^A		$ 13.02

Institutional Class: Net Asset Value, offering price and redemption price per share ($61,573,418 ÷ 4,755,362 shares)		$ 12.95

^ARedemption price per share is equal to net asset value less any applicable contingent deferred sales charge.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Statement of Operations

	Year ended October 31, 2006

Investment Income
Interest		$ 30,774,702

Expenses
Management fee	$ 2,501,104
Transfer agent fees	739,624
Distribution fees	2,277,935
Accounting fees and expenses	166,353
Custodian fees and expenses	11,523
Independent trustees' compensation	2,693
Registration fees	91,608
Audit	51,335
Legal	8,416
Miscellaneous	3,676
Total expenses before reductions	5,854,267
Expense reductions	(332,117)	5,522,150
Net investment income		25,252,552
Realized and Unrealized Gain (Loss) Net realized gain (loss) on:
Investment securities:
Unaffiliated issuers	5,559,165
Futures contracts	116,664
Total net realized gain (loss)		5,675,829
Change in net unrealized appreciation (depreciation) on investment securities		4,279,338
Net gain (loss)		9,955,167
Net increase (decrease) in net assets resulting from operations		$ 35,207,719

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Statements - continued

Statement of Changes in Net Assets

	Year ended October 31, 2006	Year ended October 31, 2005
Increase (Decrease) in Net Assets
Operations
Net investment income	$ 25,252,552	$ 23,857,985
Net realized gain (loss)	5,675,829	8,968,764
Change in net unrealized appreciation (depreciation)	4,279,338	(19,180,759)
Net increase (decrease) in net assets resulting from operations	35,207,719	13,645,990
Distributions to shareholders from net investment income	(25,274,196)	(23,793,542)
Distributions to shareholders from net realized gain	(8,244,683)	(5,181,802)
Total distributions	(33,518,879)	(28,975,344)
Share transactions - net increase (decrease)	(16,629,046)	51,939,913
Total increase (decrease) in net assets	(14,940,206)	36,610,559

Net Assets
Beginning of period	658,742,100	622,131,541
End of period (including distributions in excess of net investment income of $193,440 and distributions in excess of net investment income of $158,981, respectively)	$ 643,801,894	$ 658,742,100

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Class A

Years ended October 31,	2006	2005	2004	2003	2002
Selected Per-Share Data
Net asset value, beginning of period	$ 12.97	$ 13.28	$ 13.00	$ 12.87	$ 12.70
Income from Investment Operations
Net investment income ^C	.504	.521	.533	.539	.557
Net realized and unrealized gain (loss)	.193	(.201)	.301	.137	.168
Total from investment operations	.697	.320	.834	.676	.725
Distributions from net investment income	(.505)	(.520)	(.532)	(.544)	(.555)
Distributions from net realized gain	(.162)	(.110)	(.022)	(.002)	-
Total distributions	(.667)	(.630)	(.554)	(.546)	(.555)
Net asset value, end of period	$ 13.00	$ 12.97	$ 13.28	$ 13.00	$ 12.87
Total Return ^A,B	5.56%	2.46%	6.56%	5.33%	5.88%
Ratios to Average Net Assets ^D
Expenses before reductions	.68%	.69%	.69%	.68%	.69%
Expenses net of fee waivers, if any	.68%	.69%	.69%	.68%	.69%
Expenses net of all reductions	.63%	.67%	.69%	.68%	.67%
Net investment income	3.93%	3.96%	4.07%	4.15%	4.41%
Supplemental Data
Net assets, end of period (000 omitted)	$ 144,183	$ 123,844	$ 101,763	$ 87,406	$ 67,457
Portfolio turnover rate	26%	22%	17%	26%	20%

^A Total returns would have been lower had certain expenses not been reduced during the periods shown.

^B Total returns do not include the effect of the sales charges.

^C Calculated based on average shares outstanding during the period.

^D Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Class T

Years ended October 31,	2006	2005	2004	2003	2002
Selected Per-Share Data
Net asset value, beginning of period	$ 13.00	$ 13.31	$ 13.03	$ 12.89	$ 12.72
Income from Investment Operations
Net investment income ^C	.493	.509	.522	.529	.546
Net realized and unrealized gain (loss)	.181	(.202)	.299	.144	.166
Total from investment operations	.674	.307	.821	.673	.712
Distributions from net investment income	(.492)	(.507)	(.519)	(.531)	(.542)
Distributions from net realized gain	(.162)	(.110)	(.022)	(.002)	-
Total distributions	(.654)	(.617)	(.541)	(.533)	(.542)
Net asset value, end of period	$ 13.02	$ 13.00	$ 13.31	$ 13.03	$ 12.89
Total Return ^A,B	5.36%	2.35%	6.44%	5.30%	5.76%
Ratios to Average Net Assets ^D
Expenses before reductions	.78%	.79%	.79%	.78%	.79%
Expenses net of fee waivers, if any	.78%	.79%	.79%	.78%	.79%
Expenses net of all reductions	.73%	.77%	.78%	.77%	.77%
Net investment income	3.83%	3.86%	3.97%	4.06%	4.31%
Supplemental Data
Net assets, end of period (000 omitted)	$ 310,132	$ 318,973	$ 319,734	$ 340,542	$ 354,030
Portfolio turnover rate	26%	22%	17%	26%	20%

^A Total returns would have been lower had certain expenses not been reduced during the periods shown.

^B Total returns do not include the effect of the sales charges.

^C Calculated based on average shares outstanding during the period.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Class B

Years ended October 31,	2006	2005	2004	2003	2002
Selected Per-Share Data
Net asset value, beginning of period	$ 12.94	$ 13.25	$ 12.98	$ 12.85	$ 12.67
Income from Investment Operations
Net investment income ^C	.407	.421	.435	.443	.462
Net realized and unrealized gain (loss)	.193	(.200)	.291	.136	.178
Total from investment operations	.600	.221	.726	.579	.640
Distributions from net investment income	(.408)	(.421)	(.434)	(.447)	(.460)
Distributions from net realized gain	(.162)	(.110)	(.022)	(.002)	-
Total distributions	(.570)	(.531)	(.456)	(.449)	(.460)
Net asset value, end of period	$ 12.97	$ 12.94	$ 13.25	$ 12.98	$ 12.85
Total Return ^A,B	4.78%	1.70%	5.70%	4.56%	5.19%
Ratios to Average Net Assets ^D
Expenses before reductions	1.44%	1.45%	1.44%	1.43%	1.44%
Expenses net of fee waivers, if any	1.44%	1.45%	1.44%	1.43%	1.44%
Expenses net of all reductions	1.39%	1.42%	1.44%	1.42%	1.41%
Net investment income	3.17%	3.21%	3.32%	3.41%	3.66%
Supplemental Data
Net assets, end of period (000 omitted)	$ 65,114	$ 82,084	$ 97,487	$ 110,853	$ 109,986
Portfolio turnover rate	26%	22%	17%	26%	20%

^A Total returns would have been lower had certain expenses not been reduced during the periods shown.

^B Total returns do not include the effect of the contingent deferred sales charge.

^C Calculated based on average shares outstanding during the period.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Class C

Years ended October 31,	2006	2005	2004	2003	2002
Selected Per-Share Data
Net asset value, beginning of period	$ 12.99	$ 13.30	$ 13.02	$ 12.89	$ 12.71
Income from Investment Operations
Net investment income ^C	.396	.410	.423	.430	.451
Net realized and unrealized gain (loss)	.192	(.202)	.300	.135	.176
Total from investment operations	.588	.208	.723	.565	.627
Distributions from net investment income	(.396)	(.408)	(.421)	(.433)	(.447)
Distributions from net realized gain	(.162)	(.110)	(.022)	(.002)	-
Total distributions	(.558)	(.518)	(.443)	(.435)	(.447)
Net asset value, end of period	$ 13.02	$ 12.99	$ 13.30	$ 13.02	$ 12.89
Total Return ^A,B	4.66%	1.59%	5.65%	4.44%	5.06%
Ratios to Average Net Assets ^D
Expenses before reductions	1.53%	1.54%	1.54%	1.53%	1.53%
Expenses net of fee waivers, if any	1.53%	1.54%	1.54%	1.53%	1.53%
Expenses net of all reductions	1.48%	1.52%	1.54%	1.52%	1.51%
Net investment income	3.08%	3.11%	3.22%	3.31%	3.57%
Supplemental Data
Net assets, end of period (000 omitted)	$ 62,799	$ 63,984	$ 58,984	$ 59,423	$ 52,019
Portfolio turnover rate	26%	22%	17%	26%	20%

^A Total returns would have been lower had certain expenses not been reduced during the periods shown.

^B Total returns do not include the effect of the contingent deferred sales charge.

^C Calculated based on average shares outstanding during the period.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Institutional Class

Years ended October 31,	2006	2005	2004	2003	2002
Selected Per-Share Data
Net asset value, beginning of period	$ 12.92	$ 13.24	$ 12.96	$ 12.83	$ 12.66
Income from Investment Operations
Net investment income ^B	.520	.540	.551	.556	.573
Net realized and unrealized gain (loss)	.196	(.208)	.304	.139	.170
Total from investment operations	.716	.332	.855	.695	.743
Distributions from net investment income	(.524)	(.542)	(.553)	(.563)	(.573)
Distributions from net realized gain	(.162)	(.110)	(.022)	(.002)	-
Total distributions	(.686)	(.652)	(.575)	(.565)	(.573)
Net asset value, end of period	$ 12.95	$ 12.92	$ 13.24	$ 12.96	$ 12.83
Total Return ^A	5.73%	2.56%	6.75%	5.50%	6.05%
Ratios to Average Net Assets ^C
Expenses before reductions	.54%	.53%	.54%	.54%	.55%
Expenses net of fee waivers, if any	.54%	.53%	.54%	.54%	.55%
Expenses net of all reductions	.49%	.51%	.53%	.53%	.52%
Net investment income	4.07%	4.13%	4.23%	4.30%	4.55%
Supplemental Data
Net assets, end of period (000 omitted)	$ 61,573	$ 69,857	$ 44,164	$ 44,960	$ 31,703
Portfolio turnover rate	26%	22%	17%	26%	20%

^A Total returns would have been lower had certain expenses not been reduced during the periods shown.

^B Calculated based on average shares outstanding during the period.

^C Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Notes to Financial Statements

For the period ended October 31, 2006

1. Significant Accounting Policies.

Fidelity Advisor Municipal Income Fund (the Fund) is a fund of Fidelity Advisor Series II (the trust) and is authorized to issue an unlimited number of shares. The trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust.

The Fund offers Class A, Class T, Class B, Class C, and Institutional Class shares, each of which has equal rights as to assets and voting privileges. Each class has exclusive voting rights with respect to matters that affect that class. Class B shares will automatically convert to Class A shares after a holding period of seven years from the initial date of purchase. Investment income, realized and unrealized capital gains and losses, the common expenses of the Fund, and certain fund-level expense reductions, if any, are allocated on a pro rata basis to each class based on the relative net assets of each class to the total net assets of the Fund. Each class differs with respect to transfer agent and distribution and service plan fees incurred. Certain expense reductions also differ by class.

The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which require management to make certain estimates and assumptions at the date of the financial statements. The following summarizes the significant accounting policies of the Fund:

Security Valuation. Investments are valued and net asset value per share is calculated (NAV calculation) as of the close of business of the New York Stock Exchange, normally 4:00 p.m. Eastern time. Wherever possible, the Fund uses independent pricing services approved by the Board of Trustees to value its investments. Debt securities, including restricted securities, for which quotes are readily available, are valued by independent pricing services or by dealers who make markets in such securities. Pricing services consider yield or price of bonds of comparable quality, coupon, maturity and type as well as dealer supplied prices. When current market prices or quotations are not readily available or do not accurately reflect fair value, valuations may be determined in accordance with procedures adopted by the Board of Trustees. The frequency of when fair value pricing is used is unpredictable. The value of securities used for NAV calculation under fair value pricing may differ from published prices for the same securities. Investments in open-end mutual funds are valued at their closing net asset value each business day. Short-term securities with remaining maturities of sixty days or less for which quotations are not readily available are valued at amortized cost, which approximates value.

Annual Report

Notes to Financial Statements - continued

1. Significant Accounting Policies - continued

Investment Transactions and Income. Security transactions are accounted for as of trade date. Gains and losses on securities sold are determined on the basis of identified cost. Interest income is accrued as earned. Interest income includes coupon interest and amortization of premium and accretion of discount on debt securities.

Expenses. Most expenses of the trust can be directly attributed to a fund. Expenses which cannot be directly attributed are apportioned among each Fund in the trust. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.

Dividends are declared daily and paid monthly from net investment income. Distributions from realized gains, if any, are recorded on the ex-dividend date. Income dividends and capital gain distributions are declared separately for each class. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from generally accepted accounting principles. In addition, the Fund will claim a portion of the payment made to redeeming shareholders as a distribution for income tax purposes.

Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Temporary book-tax differences will reverse in a subsequent period.

Book-tax differences are primarily due to futures transactions, market discount, deferred trustees compensation and losses deferred due to wash sales and futures transactions.

The Fund purchases municipal securities whose interest, in the opinion of the issuer, is free from federal income tax. There is no assurance that the Internal Revenue Service (IRS) will agree with this opinion. In the event the IRS determines that the issuer does not comply with relevant tax requirements, interest payments from a security could become federally taxable, possibly retroactively to the date the security was issued.

Annual Report

1. Significant Accounting Policies - continued

Income Tax Information and Distributions to Shareholders - continued

The tax-basis components of distributable earnings and the federal tax cost as of period end were as follows:

Unrealized appreciation	$ 24,524,584
Unrealized depreciation	(175,056)
Net unrealized appreciation (depreciation)	24,349,528
Undistributed ordinary income	3,349
Undistributed long-term capital gain	4,625,537

Cost for federal income tax purposes	$ 614,644,634

The tax character of distributions paid was as follows:

	October 31, 2006	October 31, 2005
Tax-exempt Income	$ 25,274,196	$ 23,793,542
Ordinary Income	458,038	-
Long-term Capital Gains	7,786,645	5,181,802
Total	$ 33,518,879	$ 28,975,344

New Accounting Pronouncements. In July 2006, Financial Accounting Standards Board Interpretation No. 48, Accounting for Uncertainty in Income Taxes - an interpretation of FASB Statement 109 (FIN 48), was issued and is effective for fiscal years beginning after December 15, 2006. FIN 48 sets forth a threshold for financial statement recognition, measurement and disclosure of a tax position taken or expected to be taken on a tax return. Management is currently evaluating the impact, if any, the adoption of FIN 48 will have on the Fund's net assets, results of operations and financial statement disclosures.

In addition, in September 2006, Statement of Financial Accounting Standards No. 157, Fair Value Measurements (SFAS 157), was issued and is effective for fiscal years beginning after November 15, 2007. SFAS 157 defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. Management is currently evaluating the impact the adoption of SFAS 157 will have on the Fund's financial statement disclosures.

2. Operating Policies.

Delayed Delivery Transactions and When-Issued Securities. The Fund may purchase or sell securities on a delayed delivery or when-issued basis. Payment and delivery may take place after the customary settlement period for that security. The price of the underlying securities and the date when the securities will be delivered and paid

Annual Report

Notes to Financial Statements - continued

2. Operating Policies - continued

Delayed Delivery Transactions and When-Issued Securities - continued

for are fixed at the time the transaction is negotiated. During the time a delayed delivery sell is outstanding, the contract is marked-to-market daily and equivalent deliverable securities are held for the transaction. The value of the securities purchased on a delayed delivery or when-issued basis are identified as such in the Fund's Schedule of Investments. The Fund may receive compensation for interest forgone in the purchase of a delayed delivery or when-issued security. With respect to purchase commitments, the Fund identifies securities as segregated in its records with a value at least equal to the amount of the commitment. Losses may arise due to changes in the value of the underlying securities or if the counterparty does not perform under the contract's terms, or if the issuer does not issue the securities due to political, economic, or other factors.

Futures Contracts. The Fund may use futures contracts to manage its exposure to the bond market and to fluctuations in interest rates. Buying futures tends to increase a fund's exposure to the underlying instrument, while selling futures tends to decrease a fund's exposure to the underlying instrument or hedge other fund investments. Upon entering into a futures contract, a fund is required to deposit with a clearing broker, no later than the following business day, an amount ("initial margin") equal to a certain percentage of the face value of the contract. The initial margin may be in the form of cash or securities and is transferred to a segregated account on settlement date. Subsequent payments ("variation margin") are made or received by a fund depending on the daily fluctuations in the value of the futures contract and are accounted for as unrealized gains or losses. Realized gains (losses) are recorded upon the expiration or closing of the futures contract. Securities deposited to meet margin requirements are identified in the Schedule of Investments. Losses may arise from changes in the value of the underlying instruments or if the counterparties do not perform under the contract's terms. Futures contracts are valued at the settlement price established each day by the board of trade or exchange on which they are traded.

3. Purchases and Sales of Investments.

Purchases and sales of securities, other than short-term securities, aggregated $175,455,215 and $194,493,624, respectively.

4. Fees and Other Transactions with Affiliates.

Management Fee. Fidelity Management & Research Company (FMR) and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .25% of the Fund's average net assets and a group fee rate that averaged .12% during the period. The group fee rate is based upon the

Annual Report

4. Fees and Other Transactions with Affiliates - continued

Management Fee - continued

average net assets of all the mutual funds advised by FMR. The group fee rate decreases as assets under management increase and increases as assets under management decrease. For the period, the total annual management fee rate was .37% of the Fund's average net assets.

Distribution and Service Plan. In accordance with Rule 12b-1 of the 1940 Act, the Fund has adopted separate Distribution and Service Plans for each class of shares. Certain classes pay Fidelity Distributors Corporation (FDC), an affiliate of FMR, separate Distribution and Service Fees, each of which is based on an annual percentage of each class' average net assets. In addition, FDC may pay financial intermediaries for selling shares of the Fund and providing shareholder support services. For the period, the Distribution and Service Fee rates and the total amounts paid to and retained by FDC were as follows:

	Distribution Fee	Service Fee	Paid to FDC	Retained by FDC
Class A	0%	.15%	$ 209,032	$ 3,340
Class T	0%	.25%	787,222	4,485
Class B	.65%	.25%	652,930	472,871
Class C	.75%	.25%	628,751	120,992
			$ 2,277,935	$ 601,688

Sales Load. FDC receives a front-end sales charge of up to 4.75% for selling Class A shares, and 3.50% for selling Class T shares, some of which is paid to financial intermediaries for selling shares of the Fund. FDC receives the proceeds of contingent deferred sales charges levied on Class A, Class T, Class B, and Class C redemptions. These charges depend on the holding period. The deferred sales charges range from 5% to 1% for Class B, 1% for Class C, .75% to .50% for certain purchases of Class A shares (.25% prior to February 24, 2006) and .25% for certain purchases of Class T shares.

For the period, sales charge amounts retained by FDC were as follows:

	Retained by FDC
Class A	$ 76,106
Class T	35,294
Class B*	203,620
Class C*	15,019
	$ 330,039

* When Class B and Class C shares are initially sold, FDC pays commissions from its own resources to financial intermediaries through which the sales are made.

Annual Report

Notes to Financial Statements - continued

4. Fees and Other Transactions with Affiliates - continued

Transfer Agent and Accounting Fees. Citibank, N.A. (Citibank) is the custodian, transfer agent, and shareholder servicing agent for each class of the Fund. Citibank has entered into a sub-arrangement with Fidelity Investments Institutional Operations Company, Inc. (FIIOC), an affiliate of FMR, with respect to all classes of the Fund to perform the transfer, dividend disbursing, and shareholder servicing agent functions. FIIOC receives account fees and asset-based fees that vary according to the account size and type of account of the shareholders of the respective classes of the Fund. All fees are paid to FIIOC by Citibank, which is reimbursed by each class for such payments. FIIOC pays for typesetting, printing and mailing of shareholder reports, except proxy statements. For the period, each class paid the following transfer agent fees:

	Amount	% of Average Net Assets
Class A	$ 148,834	.11
Class T	340,485	.11
Class B	84,206	.12
Class C	67,732	.11
Institutional Class	98,367	.12
	$ 739,624

Citibank also has a sub-arrangement with Fidelity Service Company, Inc. (FSC), an affiliate of FMR, under which FSC maintains the Fund's accounting records. The fee is based on the level of average net assets for the month.

5. Committed Line of Credit.

The Fund participates with other funds managed by FMR in a $4.2 billion credit facility (the "line of credit") to be utilized for temporary or emergency purposes to fund shareholder redemptions or for other short-term liquidity purposes. The Fund has agreed to pay commitment fees on its pro rata portion of the line of credit, which amounts to $1,534 and is reflected in Miscellaneous Expense on the Statement of Operations. During the period, there were no borrowings on this line of credit.

Annual Report

6. Expense Reductions.

Through arrangements with the Fund's custodian and each class' transfer agent, credits realized as a result of uninvested cash balances were used to reduce the Fund's expenses. During the period, these credits reduced the Fund's custody and accounting expenses by $11,523 and $162,164, respectively. During the period, credits reduced each class' transfer agent expense as noted in the table below.

	Transfer Agent expense reduction
Class A	$ 32,477
Class T	74,770
Class B	16,847
Class C	14,563
Institutional Class	19,773
	$ 158,430

7. Other.

The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund's maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.

During the period, the Fund's transfer agent, Fidelity Investments Institutional Operations Company, Inc. (FIIOC), an affiliate of Fidelity Management & Research Company, notified the Fund that the fund's books and records did not reflect a conversion of certain Class B to Class A shares upon their conversion date. Management has determined that this did not have a material impact to the Fund's reported net assets or results of operations in the accompanying financial statements. FIIOC will cause the books and records of the Fund to reflect a conversion of the relevant Class B shares to Class A and is in the process of determining the impact to affected shareholder accounts for purposes of its remediation.

Annual Report

Notes to Financial Statements - continued

8. Distributions to Shareholders.

Distributions to shareholders of each class were as follows:

	Years ended October 31,
	2006	2005
From net investment income
Class A	$ 5,475,285	$ 4,352,247
Class T	12,053,776	12,293,343
Class B	2,316,388	2,889,040
Class C	1,936,779	1,912,870
Institutional Class	3,491,968	2,346,042
Total	$ 25,274,196	$ 23,793,542
From net realized gain
Class A	$ 1,555,692	$ 849,843
Class T	3,978,415	2,646,649
Class B	1,007,878	802,913
Class C	788,459	495,651
Institutional Class	914,239	386,746
Total	$ 8,244,683	$ 5,181,802

9. Share Transactions.

Transactions for each class of shares were as follows:

	Shares Years ended October 31,		Dollars Years ended October 31,
	2006	2005	2006	2005
Class A
Shares sold	4,948,217	3,538,994	$ 63,420,086	$ 46,541,886
Reinvestment of distributions	371,154	260,181	4,767,130	3,414,353
Shares redeemed	(3,774,302)	(1,912,570)	(48,584,463)	(25,132,123)
Net increase (decrease)	1,545,069	1,886,605	$ 19,602,753	$ 24,824,116
Class T
Shares sold	3,432,677	3,536,120	$ 44,171,647	$ 46,651,169
Reinvestment of distributions	936,819	836,332	12,055,637	10,998,832
Shares redeemed	(5,102,497)	(3,856,498)	(65,624,444)	(50,817,550)
Net increase (decrease)	(733,001)	515,954	$ (9,397,160)	$ 6,832,451
Class B
Shares sold	401,486	461,635	$ 5,146,784	$ 6,060,771
Reinvestment of distributions	154,058	167,091	1,974,082	2,187,643
Shares redeemed	(1,876,847)	(1,641,543)	(24,024,161)	(21,554,810)
Net increase (decrease)	(1,321,303)	(1,012,817)	$ (16,903,295)	$ (13,306,396)

Annual Report

9. Share Transactions - continued

	Shares Years ended October 31,		Dollars Years ended October 31,
	2006	2005	2006	2005
Class C
Shares sold	1,151,475	1,328,623	$ 14,821,030	$ 17,510,616
Reinvestment of distributions	139,244	114,142	1,791,102	1,500,047
Shares redeemed	(1,392,566)	(951,725)	(17,907,457)	(12,532,673)
Net increase (decrease)	(101,847)	491,040	$ (1,295,325)	$ 6,477,990
Institutional Class
Shares sold	5,188,827	2,803,468	$ 66,328,861	$ 36,736,293
Reinvestment of distributions	115,403	26,000	1,473,273	340,092
Shares redeemed	(5,953,881)	(760,791)	(76,438,153)	(9,964,633)
Net increase (decrease)	(649,651)	2,068,677	$ (8,636,019)	$ 27,111,752

Annual Report

Report of Independent Registered Public Accounting Firm

To the Trustees of Fidelity Advisor Series II and the Shareholders of Fidelity Advisor Municipal Income Fund:

In our opinion, the accompanying statement of assets and liabilities, including the schedule of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of Fidelity Advisor Municipal Income Fund (a fund of Fidelity Advisor Series II) at October 31, 2006, and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Fidelity Advisor Municipal Income Fund's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at October 31, 2006 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.

PricewaterhouseCoopers LLP

Boston, Massachusetts

December 15, 2006

Annual Report

Trustees and Officers

The Trustees, Members of the Advisory Board, and executive officers of the trust and fund, as applicable, are listed below. The Board of Trustees governs the fund and is responsible for protecting the interests of shareholders. The Trustees are experienced executives who meet periodically throughout the year to oversee the fund's activities, review contractual arrangements with companies that provide services to the fund, and review the fund's performance. Except for William O. McCoy, each of the Trustees oversees 348 funds advised by FMR or an affiliate. Mr. McCoy oversees 350 funds advised by FMR or an affiliate.

The Trustees hold office without limit in time except that (a) any Trustee may resign; (b) any Trustee may be removed by written instrument, signed by at least two-thirds of the number of Trustees prior to such removal; (c) any Trustee who requests to be retired or who has become incapacitated by illness or injury may be retired by written instrument signed by a majority of the other Trustees; and (d) any Trustee may be removed at any special meeting of shareholders by a two-thirds vote of the outstanding voting securities of the trust. Each Trustee who is not an interested person (as defined in the 1940 Act) (Independent Trustee), shall retire not later than the last day of the calendar year in which his or her 72nd birthday occurs. The Independent Trustees may waive this mandatory retirement age policy with respect to individual Trustees. The executive officers and Advisory Board Members hold office without limit in time, except that any officer and Advisory Board Member may resign or may be removed by a vote of a majority of the Trustees at any regular meeting or any special meeting of the Trustees. Except as indicated, each individual has held the office shown or other offices in the same company for the past five years.

The fund's statement of additional information (SAI) includes more information about the Trustees. To request a free copy, call Fidelity at 1-877-208-0098

Interested Trustees*:

Correspondence intended for each Trustee who is an interested person may be sent to Fidelity Investments, 82 Devonshire Street, Boston, Massachusetts 02109.

Name, Age; Principal Occupation
Edward C. Johnson 3d (76)
	Year of Election or Appointment: 1986 Mr. Johnson is Chairman of the Board of Trustees. Mr. Johnson serves as President (2006-present), Chief Executive Officer, Chairman, and a Director of FMR Corp.; Chairman and a Director of FMR; Chairman and a Director of Fidelity Research & Analysis Company (FRAC); Chairman and a Director of Fidelity Investments Money Management, Inc.; and Chairman (2001-present) and a Director of FMR Co., Inc. In addition, Mr. Johnson serves as Chairman and Director of Fidelity International Limited (FIL).
Stephen P. Jonas (53)
	Year of Election or Appointment: 2005 Mr. Jonas is Senior Vice President of Advisor Municipal Income (2005-present). He also serves as Senior Vice President of other Fidelity funds (2005-present). Mr. Jonas is Executive Director of FMR (2005-present) and FMR Co., Inc. (2005-present). He also serves as a Director of Fidelity Investments Money Management, Inc. (2005-present) and FMR Corp. (2003-present). Previously, Mr. Jonas served as President of Fidelity Enterprise Operations and Risk Services (2004-2005), Chief Administrative Officer (2002-2004), and Chief Financial Officer of FMR Corp. (1998-2002). In addition, he serves on the Boards of Boston Ballet (2003-present) and Simmons College (2003-present).
Robert L. Reynolds (54)
	Year of Election or Appointment: 2003 Mr. Reynolds is President and a Director of FMR (2005-present), Fidelity Investments Money Management, Inc. (2005-present), and FMR Co., Inc. (2005-present). Mr. Reynolds also serves as Vice Chairman (2006-present), a Director (2003-present), and Chief Operating Officer of FMR Corp. and a Director of Strategic Advisers, Inc. (2005-present). He also serves on the Board at Fidelity Investments Canada, Ltd.

* Trustees have been determined to be "Interested Trustees" by virtue of, among other things, their affiliation with the trust or various entities under common control with FMR.

Annual Report

Independent Trustees:

Correspondence intended for each Independent Trustee (that is, the Trustees other than the Interested Trustees) may be sent to Fidelity Investments, P.O. Box 55235, Boston, Massachusetts 02205-5235.

Name, Age; Principal Occupation
Dennis J. Dirks (58)
	Year of Election or Appointment: 2005 Prior to his retirement in May 2003, Mr. Dirks was Chief Operating Officer and a member of the Board of The Depository Trust & Clearing Corporation (DTCC) (1999-2003). He also served as President, Chief Operating Officer, and Board member of The Depository Trust Company (DTC) (1999-2003) and President and Board member of the National Securities Clearing Corporation (NSCC) (1999-2003). In addition, Mr. Dirks served as Chief Executive Officer and Board member of the Government Securities Clearing Corporation (2001-2003) and Chief Executive Officer and Board member of the Mortgage-Backed Securities Clearing Corporation (2001-2003). Mr. Dirks also serves as a Trustee and a member of the Finance Committee of Manhattan College (2005-present) and a Trustee and a member of the Finance Committee of AHRC of Nassau County (2006-present).
Albert R. Gamper, Jr. (64)
	Year of Election or Appointment: 2006 Prior to his retirement in December 2004, Mr. Gamper served as Chairman of the Board of CIT Group Inc. (commercial finance). During his tenure with CIT Group Inc. Mr. Gamper served in numerous senior management positions, including Chairman (1987-1989; 1999-2001; 2002-2004), Chief Executive Officer (1987-2004), and President (1989-2002). He currently serves as a member of the Board of Directors of Public Service Enterprise Group (utilities, 2001-present), Chairman of the Board of Governors, Rutgers University (2004-present), and Chairman of the Board of Saint Barnabas Health Care System.
George H. Heilmeier (70)
	Year of Election or Appointment: 2004 Dr. Heilmeier is Chairman Emeritus of Telcordia Technologies (communication software and systems), where prior to his retirement, he served as company Chairman and Chief Executive Officer. He currently serves on the Boards of Directors of The Mitre Corporation (systems engineering and information technology support for the government), and HRL Laboratories (private research and development, 2004-present). He is Chairman of the General Motors Science & Technology Advisory Board and a Life Fellow of the Institute of Electrical and Electronics Engineers (IEEE). Dr. Heilmeier is a member of the Defense Science Board and the National Security Agency Advisory Board. He is also a member of the National Academy of Engineering, the American Academy of Arts and Sciences, and the Board of Overseers of the School of Engineering and Applied Science of the University of Pennsylvania. Previously, Dr. Heilmeier served as a Director of TRW Inc. (automotive, space, defense, and information technology, 1992-2002), Compaq (1994-2002), Automatic Data Processing, Inc. (ADP) (technology-based business outsourcing, 1995-2002), INET Technologies Inc. (telecommunications network surveillance, 2001-2004), and Teletech Holdings (customer management services). He is the recipient of the 2005 Kyoto Prize in Advanced Technology for his invention of the liquid crystal display, and a member of the Consumer Electronics Hall of Fame.
Marie L. Knowles (60)
	Year of Election or Appointment: 2001 Prior to Ms. Knowles' retirement in June 2000, she served as Executive Vice President and Chief Financial Officer of Atlantic Richfield Company (ARCO) (diversified energy, 1996-2000). From 1993 to 1996, she was a Senior Vice President of ARCO and President of ARCO Transportation Company. She served as a Director of ARCO from 1996 to 1998. She currently serves as a Director of Phelps Dodge Corporation (copper mining and manufacturing) and McKesson Corporation (healthcare service, 2002-present). Ms. Knowles is a Trustee of the Brookings Institution and the Catalina Island Conservancy and also serves as a member of the Advisory Board for the School of Engineering of the University of Southern California.
Ned C. Lautenbach (62)
	Year of Election or Appointment: 2000 Mr. Lautenbach is Chairman of the Independent Trustees (2006-present). Mr. Lautenbach has been a partner of Clayton, Dubilier & Rice, Inc. (private equity investment firm) since September 1998. Previously, Mr. Lautenbach was with the International Business Machines Corporation (IBM) from 1968 until his retirement in 1998. Mr. Lautenbach serves as a Director of Sony Corporation (2006-present) and Eaton Corporation (diversified industrial) as well as the Philharmonic Center for the Arts in Naples, Florida. He also is a member of the Board of Trustees of Fairfield University (2005-present), as well as a member of the Council on Foreign Relations.
William O. McCoy (73)
	Year of Election or Appointment: 1997 Prior to his retirement in December 1994, Mr. McCoy was Vice Chairman of the Board of BellSouth Corporation (telecommunications) and President of BellSouth Enterprises. He is currently a Director of Duke Realty Corporation (real estate). He is also a partner of Franklin Street Partners (private investment management firm). In addition, Mr. McCoy served as the Interim Chancellor (1999-2000) and a member of the Board of Visitors for the University of North Carolina at Chapel Hill and currently serves as Chairman of the Board of Directors of the University of North Carolina Health Care System. He also served as Vice President of Finance for the University of North Carolina (16-school system).
Cornelia M. Small (62)
	Year of Election or Appointment: 2005 Ms. Small is a member (2000-present) and Chairperson (2002-present) of the Investment Committee, and a member (2002-present) of the Board of Trustees of Smith College. Previously, she served as Chief Investment Officer (1999-2000), Director of Global Equity Investments (1996-1999), and a member of the Board of Directors of Scudder, Stevens & Clark (1990-1997) and Scudder Kemper Investments (1997-1999). In addition, Ms. Small served as Co-Chair (2000-2003) of the Annual Fund for the Fletcher School of Law and Diplomacy.
William S. Stavropoulos (67)
	Year of Election or Appointment: 2001 Mr. Stavropoulos is Chairman Emeritus of the Board of Directors of The Dow Chemical Company. Since joining The Dow Chemical Company in 1967, Mr. Stavropoulos served in numerous senior management positions, including President (1993-2000; 2002-2003), CEO (1995-2000; 2002-2004), and Chairman of the Executive Committee (2000-2004). Currently, he is a Director of NCR Corporation (data warehousing and technology solutions), BellSouth Corporation (telecommunications), Chemical Financial Corporation, Maersk Inc. (industrial conglomerate, 2002-present), and Metalmark Capital (private equity investment firm, 2005-present). He also serves as a member of the Board of Trustees of the American Enterprise Institute for Public Policy Research. In addition, Mr. Stavropoulos is a member of The Business Council, J.P. Morgan International Council and the University of Notre Dame Advisory Council for the College of Science.
Kenneth L. Wolfe (67)
	Year of Election or Appointment: 2005 Prior to his retirement in 2001, Mr. Wolfe was Chairman and Chief Executive Officer of Hershey Foods Corporation (1993-2001). He currently serves as a member of the boards of Adelphia Communications Corporation (2003-present), Bausch & Lomb, Inc., and Revlon Inc. (2004-present).

Annual Report

Advisory Board Members and Executive Officers:

Correspondence intended for Mr. Keyes may be sent to Fidelity Investments, P.O. Box 55235, Boston, Massachusetts 02205-5235. Correspondence intended for each executive officer and Mr. Lynch may be sent to Fidelity Investments, 82 Devonshire Street, Boston, Massachusetts 02109.

Name, Age; Principal Occupation
James H. Keyes (66)
	Year of Election or Appointment: 2006 Member of the Advisory Board of Fidelity Advisor Series II. Prior to his retirement in 2003, Mr. Keyes was Chairman, President, and Chief Executive Officer of Johnson Controls, Inc. (automotive supplier, 1993-2003). He currently serves as a member of the boards of LSI Logic Corporation (semiconductor technologies), Navistar International Corporation (manufacture and sale of trucks, buses, and diesel engines, 2002-present), and Pitney Bowes, Inc. (integrated mail, messaging, and document management solutions).
Peter S. Lynch (62)
	Year of Election or Appointment: 2003 Member of the Advisory Board of Fidelity Advisor Series II. Mr. Lynch is Vice Chairman and a Director of FMR, and Vice Chairman (2001- present) and a Director of FMR Co., Inc. Previously, Mr. Lynch served as a Trustee of the Fidelity funds (1990-2003). In addition, he serves as a Trustee of Boston College and as the Chairman of the Inner-City Scholarship Fund.
Boyce I. Greer (50)
	Year of Election or Appointment: 2006 Vice President of Advisor Municipal Income. Mr. Greer also serves as Vice President of certain Equity Funds (2005-present), certain Asset Allocation Funds (2005-present), Fixed-Income Funds (2006-present), and Money Market Funds (2006-present). Mr. Greer is also a Trustee of other investment companies advised by FMR (2003-present). He is an Executive Vice President of FMR (2005-present) and FMR Co., Inc. (2005-present), and Senior Vice President of Fidelity Investments Money Management, Inc. (2006-present). Previously, Mr. Greer served as a Director and Managing Director of Strategic Advisers, Inc. (2002-2005), and Executive Vice President (2000-2002) and Money Market Group Leader (1997-2002) of the Fidelity Investments Fixed Income Division. He also served as Vice President of Fidelity's Money Market Funds (1997-2002), Senior Vice President of FMR (1997-2002), and Vice President of FIMM (1998-2002).
David L. Murphy (58)
	Year of Election or Appointment: 2005 Vice President of Advisor Municipal Income. Mr. Murphy also serves as Vice President of Fidelity's Money Market Funds (2002-present), certain Asset Allocation Funds (2003-present), Fixed-Income Funds (2005-present), and Balanced Funds (2005-present). He serves as Senior Vice President (2000-present) and Head (2004-present) of the Fidelity Investments Fixed Income Division. Mr. Murphy is also a Senior Vice President of Fidelity Investments Money Management, Inc. (2003-present) and an Executive Vice President of FMR (2005-present). Previously, Mr. Murphy served as Money Market Group Leader (2002-2004), Bond Group Leader (2000-2002), and Vice President of Fidelity's Taxable Bond Funds (2000-2002) and Fidelity's Municipal Bond Funds (2001-2002).
Thomas J. Silvia (45)
	Year of Election or Appointment: 2005 Vice President of Advisor Municipal Income. Mr. Silvia also serves as Vice President of Fidelity's Fixed-Income Funds (2005-present), certain Balanced Funds (2005-present), certain Asset Allocation Funds (2005-present), and Senior Vice President and Bond Group Leader of the Fidelity Investments Fixed-Income Division (2005-present). Previously, Mr. Silvia served as Director of Fidelity's Taxable Bond portfolio managers (2002-2004) and a portfolio manager in the Bond Group (1997-2004).
Christine J. Thompson (48)
	Year of Election or Appointment: 1998 Vice President of Advisor Municipal Income. Ms. Thompson also serves as Vice President of other funds advised by FMR. Prior to assuming her current responsibilities, Ms. Thompson worked as an analyst and manager.
Eric D. Roiter (57)
	Year of Election or Appointment: 1998 Secretary of Advisor Municipal Income. He also serves as Secretary of other Fidelity funds; Vice President, General Counsel, and Secretary of FMR Co., Inc. (2001-present) and FMR; Assistant Secretary of Fidelity Management & Research (U.K.) Inc. (2001-present), Fidelity Research & Analysis Company (2001-present), and Fidelity Investments Money Management, Inc. (2001-present). Mr. Roiter is an Adjunct Member, Faculty of Law, at Boston College Law School (2003-present). Previously, Mr. Roiter served as Vice President and Secretary of Fidelity Distributors Corporation (FDC) (1998-2005).
Stuart Fross (47)
	Year of Election or Appointment: 2003 Assistant Secretary of Advisor Municipal Income. Mr. Fross also serves as Assistant Secretary of other Fidelity funds (2003-present), Vice President and Secretary of FDC (2005-present), and is an employee of FMR.
Christine Reynolds (48)
	Year of Election or Appointment: 2004 President and Treasurer of Advisor Municipal Income. Ms. Reynolds also serves as President and Treasurer of other Fidelity funds (2004-present) and is a Vice President (2003-present) and an employee (2002-present) of FMR. Before joining Fidelity Investments, Ms. Reynolds worked at PricewaterhouseCoopers LLP (PwC) (1980-2002), where she was most recently an audit partner with PwC's investment management practice.
R. Stephen Ganis (40)
	Year of Election or Appointment: 2006 Anti-Money Laundering (AML) officer of Advisor Municipal Income. Mr. Ganis also serves as AML officer of other Fidelity funds (2006-present) and FMR Corp. (2003-present). Before joining Fidelity Investments, Mr. Ganis practiced law at Goodwin Procter, LLP (2000-2002).
Joseph B. Hollis (58)
	Year of Election or Appointment: 2006 Chief Financial Officer of Advisor Municipal Income. Mr. Hollis also serves as Chief Financial Officer of other Fidelity funds. Mr. Hollis is President of Fidelity Pricing and Cash Management Services (FPCMS) (2005-present). Mr. Hollis also serves as President and Director of Fidelity Service Company, Inc. (2006-present). Previously, Mr. Hollis served as Senior Vice President of Cash Management Services (1999-2002) and Investment Management Operations (2002-2005).
Kenneth A. Rathgeber (59)
	Year of Election or Appointment: 2004 Chief Compliance Officer of Advisor Municipal Income. Mr. Rathgeber also serves as Chief Compliance Officer of other Fidelity funds (2004-present) and Executive Vice President of Risk Oversight for Fidelity Investments (2002-present). He is Chief Compliance Officer of FMR (2005-present), FMR Co., Inc. (2005-present), Fidelity Management & Research (U.K.) Inc. (2005-present), Fidelity Research & Analysis Company (2005-present), Fidelity Investments Money Management, Inc. (2005-present), and Strategic Advisers, Inc. (2005-present). Previously, Mr. Rathgeber served as Executive Vice President and Chief Operating Officer for Fidelity Investments Institutional Services Company, Inc. (1998-2002).
Bryan A. Mehrmann (45)
	Year of Election or Appointment: 2005 Deputy Treasurer of Advisor Municipal Income. Mr. Mehrmann also serves as Deputy Treasurer of other Fidelity funds (2005-present) and is an employee of FMR. Previously, Mr. Mehrmann served as Vice President of Fidelity Investments Institutional Services Group (FIIS)/Fidelity Investments Institutional Operations Corporation, Inc. (FIIOC) Client Services (1998-2004).
Kimberley H. Monasterio (42)
	Year of Election or Appointment: 2004 Deputy Treasurer of Advisor Municipal Income. Ms. Monasterio also serves as Deputy Treasurer of other Fidelity funds (2004) and is an employee of FMR (2004). Before joining Fidelity Investments, Ms. Monasterio served as Treasurer (2000-2004) and Chief Financial Officer (2002-2004) of the Franklin Templeton Funds and Senior Vice President of Franklin Templeton Services, LLC (2000-2004).
Kenneth B. Robins (37)
	Year of Election or Appointment: 2005 Deputy Treasurer of Advisor Municipal Income. Mr. Robins also serves as Deputy Treasurer of other Fidelity funds (2005-present) and is an employee of FMR (2004-present). Before joining Fidelity Investments, Mr. Robins worked at KPMG LLP, where he was a partner in KPMG's department of professional practice (2002-2004) and a Senior Manager (1999-2000). In addition, Mr. Robins served as Assistant Chief Accountant, United States Securities and Exchange Commission (2000-2002).
Robert G. Byrnes (39)
	Year of Election or Appointment: 2005 Assistant Treasurer of Advisor Municipal Income. Mr. Byrnes also serves as Assistant Treasurer of other Fidelity funds (2005-present) and is an employee of FMR (2005-present). Previously, Mr. Byrnes served as Vice President of FPCMS (2003-2005). Before joining Fidelity Investments, Mr. Byrnes worked at Deutsche Asset Management where he served as Vice President of the Investment Operations Group (2000-2003).
John H. Costello (60)
	Year of Election or Appointment: 1987 Assistant Treasurer of Advisor Municipal Income. Mr. Costello also serves as Assistant Treasurer of other Fidelity funds and is an employee of FMR.
Peter L. Lydecker (52)
	Year of Election or Appointment: 2004 Assistant Treasurer of Advisor Municipal Income. Mr. Lydecker also serves as Assistant Treasurer of other Fidelity funds (2004) and is an employee of FMR.
Mark Osterheld (51)
	Year of Election or Appointment: 2002 Assistant Treasurer of Advisor Municipal Income. Mr. Osterheld also serves as Assistant Treasurer of other Fidelity funds (2002) and is an employee of FMR.
Gary W. Ryan (48)
	Year of Election or Appointment: 2005 Assistant Treasurer of Advisor Municipal Income. Mr. Ryan also serves as Assistant Treasurer of other Fidelity funds (2005-present) and is an employee of FMR (2005-present). Previously, Mr. Ryan served as Vice President of Fund Reporting in FPCMS (1999-2005).
Salvatore Schiavone (40)
	Year of Election or Appointment: 2005 Assistant Treasurer of Advisor Municipal Income. Mr. Schiavone also serves as Assistant Treasurer of other Fidelity funds (2005-present) and is an employee of FMR (2005-present). Before joining Fidelity Investments, Mr. Schiavone worked at Deutsche Asset Management, where he most recently served as Assistant Treasurer (2003-2005) of the Scudder Funds and Vice President and Head of Fund Reporting (1996-2003).

Annual Report

Distributions

The Board of Trustees of Advisor Municipal Income Fund voted to pay to shareholders of record at the opening of business on record date, the following distributions per share derived from capital gains realized from sales of portfolio securities, and dividends derived from net investment income:

	Pay Date	Record Date	Capital Gains
Class A	12/04/06	12/01/06	$0.095

Class T	12/04/06	12/01/06	$0.095

Class B	12/04/06	12/01/06	$0.095

Class C	12/04/06	12/01/06	$0.095

The fund hereby designates as capital gain dividends: For dividends with respect to the taxable year ended October 31, 2006, $5,495,564 or, if subsequently determined to be different, the net capital gain of such year.

During fiscal year ended 2006, 100% of the fund's income dividends was free from federal income tax, and 9.72% of the fund's income dividends was subject to the federal alternative minimum tax.

The fund will notify shareholders in January 2007 of amounts for use in preparing 2006 income tax returns.

Annual Report

Board Approval of Investment Advisory Contracts and Management Fees

Fidelity Advisor Municipal Income Fund

Each year, typically in June, the Board of Trustees, including the Independent Trustees (together, the Board), votes on the renewal of the management contract and sub-advisory agreements (together, the Advisory Contracts) for the fund. The Board, assisted by the advice of fund counsel and Independent Trustees' counsel, requests and considers a broad range of information throughout the year.

The Board meets regularly each month except August and takes into account throughout the year matters bearing on Advisory Contracts. The Board, acting directly and through its separate committees, considers at each of its meetings factors that are relevant to the annual renewal of the fund's Advisory Contracts, including the services and support provided to the fund and its shareholders. At the time of the renewal, the Board had 12 standing committees, each composed of Independent Trustees with varying backgrounds, to which the Board has assigned specific subject matter responsibilities in order to enhance effective decision-making by the Board. Each committee has adopted a written charter outlining the structure and purposes of the committee. One such committee, the Fixed-Income Contract Committee, meets periodically as needed throughout the year to consider matters specifically related to the annual renewal of Advisory Contracts. The committee requests and receives information on, and makes recommendations to the Independent Trustees concerning, the approval and annual review of the Advisory Contracts.

At its June 2006 meeting, the Board of Trustees, including the Independent Trustees, unanimously determined to renew the Advisory Contracts for the fund. In reaching its determination, the Board considered all factors it believed relevant, including (i) the nature, extent, and quality of the services to be provided to the fund and its shareholders (including the investment performance of the fund); (ii) the competitiveness of the management fee and total expenses of the fund; (iii) the total costs of the services to be provided by and the profits to be realized by the investment adviser and its affiliates from the relationship with the fund; (iv) the extent to which economies of scale would be realized as the fund grows; and (v) whether fee levels reflect these economies of scale, if any, for the benefit of fund shareholders.

In determining whether to renew the Advisory Contracts for the fund, the Board ultimately reached a determination, with the assistance of fund counsel and Independent Trustees' counsel, that the renewal of the Advisory Contracts and the compensation to be received by Fidelity under the management contract is consistent with Fidelity's fiduciary duty under applicable law. In addition to evaluating the specific factors noted above, the Board, in reaching its determination, is aware that shareholders in the fund have a broad range of investment choices available to them, including a wide choice among mutual funds offered by competitors to Fidelity, and that the fund's shareholders, with the opportunity to review and weigh the disclosure provided by the fund in its prospectus and other public disclosures, have chosen to invest in this fund, managed by Fidelity.

Annual Report

Board Approval of Investment Advisory Contracts and
Management Fees - continued

Nature, Extent, and Quality of Services Provided. The Board considered staffing within the investment adviser, FMR, and the sub-advisers (together, the Investment Advisers), including the background of the fund's portfolio manager and the fund's investment objective and discipline. The Independent Trustees also had discussions with senior management of Fidelity's investment operations and investment groups. The Board considered the structure of the portfolio manager compensation program and whether this structure provides appropriate incentives.

Resources Dedicated to Investment Management and Support Services. The Board reviewed the size, education, and experience of the Investment Advisers' investment staff, their use of technology, and the Investment Advisers' approach to recruiting, training, and retaining portfolio managers and other research, advisory, and management personnel. The Board considered Fidelity's extensive global research capabilities that enable the Investment Advisers to aggregate data from various sources in an effort to produce positive investment results. The Board noted that Fidelity's analysts have access to a variety of technological tools that enable them to perform both fundamental and quantitative analysis and to specialize in various disciplines. The Board also considered that Fidelity's portfolio managers and analysts have access to daily portfolio attribution that allows for monitoring of a fund's portfolio, as well as an electronic communication system that provides immediate real-time access to research concerning issuers and credit enhancers. In addition, the Board considered the trading resources that are an integrated part of the fixed-income portfolio management investment process.

The Board noted that the growth of fund assets across the complex allows Fidelity to reinvest in the development of services designed to enhance the value or convenience of the Fidelity funds as investment vehicles. These services include 24-hour access to account information and market information through phone representatives and over the Internet, and investor education materials and asset allocation tools.

Investment in a Large Fund Family. The Board considered the benefits to shareholders of investing in a Fidelity fund, including the benefits of investing in a fund that is part of a large family of funds offering a variety of investment disciplines and providing for a large variety of mutual fund investor services. For example, fund shareholders are offered the privilege of exchanging shares of the fund for shares of other Fidelity funds, as set forth in the fund's prospectus, without paying an additional sales charge. The Board noted that, since the last Advisory Contract renewals in June 2005, Fidelity has taken a number of actions that benefited particular funds, including (i) dedicating additional resources to investment research and to restructure the investment research teams; (ii) voluntarily entering into contractual arrangements with certain brokers pursuant to which Fidelity pays for research products and services separately out of its own resources, rather than bundling with fund commissions; (iii) launching the Fidelity Advantage Class of its five Spartan stock index funds and three Spartan bond index funds, which is a lower-fee class available to shareholders with higher account balances; (iv) contractually agreeing to impose expense limitations on Fidelity U.S. Bond Index Fund and reducing the fund's initial investment minimum; and (v) offering shareholders of each of the Fidelity Institutional Money Market Funds the privilege of exchanging shares of the fund for shares of other Fidelity funds.

Annual Report

Investment Performance. The Board considered whether the fund has operated within its investment objective, as well as its record of compliance with its investment restrictions. It also reviewed the fund's absolute investment performance for each class, as well as the fund's relative investment performance for each class measured against (i) a broad-based securities market index, and (ii) a peer group of mutual funds deemed appropriate by the Board over multiple periods. The following charts considered by the Board show, over the one-, three-, and five-year periods ended December 31, 2005, the cumulative total returns of Class C and Institutional Class of the fund, the cumulative total returns of a broad-based securities market index ("benchmark"), and a range of cumulative total returns of a peer group of mutual funds identified by Lipper Inc. as having an investment objective similar to that of the fund. The returns of Class C and Institutional Class represent the performance of classes with the highest and lowest 12b-1 fees, respectively (not necessarily with the highest and lowest total expenses). The box within each chart shows the 25th percentile return (bottom of box) and the 75th percentile return (top of box) of the Lipper peer group. Returns shown above the box are in the first quartile and returns shown below the box are in the fourth quartile. The percentage beaten numbers noted below each chart correspond to the percentile box and represent the percentage of funds in the Lipper peer group whose performance was equal to or lower than that of the class indicated.

Annual Report

Board Approval of Investment Advisory Contracts and
Management Fees - continued

Fidelity Advisor Municipal Income Fund

The Board reviewed the fund's relative investment performance against its Lipper peer group and stated that the performance of Institutional Class of the fund was in the first quartile for all the periods shown. The Board also stated that the relative investment performance of Institutional Class of the fund compared favorably to its benchmark for all the periods shown. The Board considered that the variations in performance among the fund's classes reflect the variations in class expenses, which result in lower performance for higher expense classes.

Based on its review, and giving particular weight to the nature and quality of the resources dedicated by the Investment Advisers to maintain and improve relative performance, the Board concluded that the nature, extent, and quality of the services provided to the fund will benefit the fund's shareholders, particularly in light of the Board's view that the fund's shareholders benefit from investing in a fund that is part of a large family of funds offering a variety of investment disciplines and services.

Competitiveness of Management Fee and Total Fund Expenses. The Board considered the fund's management fee and total expenses compared to "mapped groups" of competitive funds and classes. Fidelity creates "mapped groups" by combining similar Lipper investment objective categories that have comparable management fee characteristics. Combining Lipper investment objective categories aids the Board's management fee and total expense comparisons by broadening the competitive group used for comparison and by reducing the number of universes to which various Fidelity funds are compared.

The Board considered two proprietary management fee comparisons for the 12-month periods shown in the chart below. The group of Lipper funds used by the Board for management fee comparisons is referred to below as the "Total Mapped Group" and, for the reasons explained above, is broader than the Lipper peer group used by the Board for performance comparisons. The Total Mapped Group comparison focuses on a fund's standing relative to the total universe of comparable funds available to investors, in terms of gross management fees before expense reimbursements or caps. "TMG %" represents the percentage of funds in the Total Mapped Group that had management fees that were lower than the fund's. For example, a TMG % of 8% means that 92% of the funds in the Total Mapped Group had higher management fees than the fund. The "Asset-Size Peer Group" (ASPG) comparison focuses on a fund's standing relative to non-Fidelity funds similar in size to the fund within the Total Mapped Group. The ASPG represents at least 15% of the funds in the Total Mapped Group with comparable asset size and management fee characteristics, subject to a minimum of 50 funds (or all funds in the Total Mapped Group if fewer than 50). Additional information, such as the ASPG quartile in which the fund's management fee ranked, is also included in the chart and considered by the Board.

Annual Report

Fidelity Advisor Municipal Income Fund

The Board noted that the fund's management fee ranked below the median of its Total Mapped Group and below the median of its ASPG for 2005. Based on its review, the Board concluded that the fund's management fee was fair and reasonable in light of the services that the fund receives and the other factors considered.

In its review of each class's total expenses, the Board considered the fund's management fee as well as other fund or class expenses, as applicable, such as transfer agent fees, pricing and bookkeeping fees, fund-paid 12b-1 fees, and custodial, legal, and audit fees. The Board also noted the effects of any waivers and reimbursements on fees and expenses. As part of its review, the Board also considered current and historical total expenses of each class of the fund compared to competitive fund median expenses. Each class of the fund is compared to those funds and classes in the Total Mapped Group (used by the Board for management fee comparisons) that have a similar sales load structure.

Annual Report

Board Approval of Investment Advisory Contracts and
Management Fees - continued

The Board noted that the total expenses of each class ranked below its competitive median for 2005.

In its review of total expenses, the Board also considered Fidelity fee structures and other information on clients that FMR and its affiliates service in other competitive markets, such as other mutual funds advised or subadvised by FMR or its affiliates, pension plan clients, and other institutional clients.

Based on its review, the Board concluded that the total expenses of each class of the fund were reasonable in light of the services that the fund and its shareholders receive and the other factors considered.

Costs of the Services and Profitability. The Board considered the revenues earned and the expenses incurred by Fidelity in conducting the business of developing, marketing, distributing, managing, administering and servicing the fund and its shareholders. The Board also considered the level of Fidelity's profits in respect of all the Fidelity funds.

On an annual basis, FMR presents to the Board Fidelity's profitability for the fund. Fidelity calculates the profitability for each fund, as well as aggregate profitability for groups of Fidelity funds and all Fidelity funds, using a series of detailed revenue and cost allocation methodologies which originate with the audited books and records of Fidelity. The Audit Committee of the Board reviews any significant changes from the prior year's methodologies.

PricewaterhouseCoopers LLP (PwC), independent registered accounting firm and auditor to Fidelity and certain Fidelity funds, has been engaged annually by the Board as part of the Board's assessment of the results of Fidelity's profitability analysis. PwC's engagement includes the review and assessment of Fidelity's methodologies used in determining the revenues and expenses attributable to Fidelity's mutual fund business, and completion of agreed-upon procedures surrounding the mathematical accuracy of fund profitability and its conformity to allocation methodologies. After considering PwC's reports issued under the engagement and information provided by Fidelity, the Board believes that while other allocation methods may also be reasonable, Fidelity's profitability methodologies are reasonable in all material respects.

The Board has also reviewed Fidelity's non-fund businesses and any fall-out benefits related to the mutual fund business as well as cases where Fidelity's affiliates may benefit from or be related to the fund's business.

Annual Report

The Board considered the costs of the services provided by and the profits realized by Fidelity in connection with the operation of the fund and determined that the amount of profit is a fair entrepreneurial profit for the management of the fund.

Economies of Scale. The Board considered whether there have been economies of scale in respect of the management of the Fidelity funds, whether the Fidelity funds (including the fund) have appropriately benefited from any such economies of scale, and whether there is potential for realization of any further economies of scale. The Board considered the extent to which the fund will benefit from economies of scale through increased services to the fund, through waivers or reimbursements, or through fee or expense reductions, including reductions that occur through operation of the transfer agent agreement. The transfer agent fee varies in part based on the number of accounts in the fund. If the number of accounts decreases or the average account size increases, the overall transfer agent fee rate decreases.

The Board recognized that the fund's management contract incorporates a "group fee" structure, which provides for lower fee rates as total fund assets under FMR's management increase, and for higher fee rates as total fund assets under FMR's management decrease. The Board considered that the group fee is designed to deliver the benefits of economies of scale to fund shareholders when total fund assets increase, even if assets of any particular fund are unchanged or have declined, because some portion of Fidelity's costs are attributable to services provided to all Fidelity funds, and all funds benefit if those costs can be allocated among more assets. The Board concluded that, given the group fee structure, fund shareholders will achieve a certain level of economies of scale as assets under FMR's management increase at the fund complex level, regardless of whether Fidelity achieves any such economies of scale.

The Board further concluded that any potential economies of scale are being shared between fund shareholders and Fidelity in an appropriate manner.

Additional Information Requested by the Board. In order to develop fully the factual basis for consideration of the Advisory Contracts, the Board requested additional information on several topics, including (i) Fidelity's fund profitability methodology and profitability trends within certain funds; (ii) funds and accounts managed by Fidelity other than the Fidelity funds, including fee arrangements; (iii) the total expenses of certain funds and classes relative to competitors; (iv) fund performance trends; and (v) Fidelity's fee structures.

Based on its evaluation of all of the conclusions noted above, and after considering all material factors, the Board ultimately concluded that the advisory fee structures are fair and reasonable, and that the fund's Advisory Contracts should be renewed.

Annual Report

Investment Adviser

Fidelity Management & Research Company

Boston, MA

Investment Sub-Advisers

Fidelity Investments Money
Management, Inc.

Fidelity Research & Analysis Company
(formerly Fidelity Management &
Research (Far East) Inc.)

Fidelity International Investment Advisors

Fidelity International Investment Advisors
(U.K.) Limited

General Distributor

Fidelity Distributors Corporation

Boston, MA

Transfer and Service Agents

Citibank, N.A.
New York, NY

Fidelity Investments Institutional Operations Company, Inc.

Boston, MA

Fidelity Service Company, Inc.

Boston, MA

Custodian

Citibank, N.A.
New York, NY

HIM-UANN-1206
1.784765.103

(Fidelity Investment logo)(registered trademark)
Corporate Headquarters
82 Devonshire St., Boston, MA 02109
www.fidelity.com

(Fidelity Investment logo)(registered trademark)

Fidelity® Advisor

Municipal Income Fund -

Institutional Class

Annual Report

October 31, 2006(Fidelity Investment logo)(registered trademark)
Corporate Headquarters
82 Devonshire St., Boston, MA 02109
www.fidelity.com

Chairman's Message	<Click Here>	Ned Johnson's message to shareholders.
Performance	<Click Here>	How the fund has done over time.
Management's Discussion	<Click Here>	The manager's review of fund performance, strategy and outlook.
Shareholder Expense Example	<Click Here>	An example of shareholder expenses.
Investment Changes	<Click Here>	A summary of major shifts in the fund's investments over the past six months.
Investments	<Click Here>	A complete list of the fund's investments with their market values.
Financial Statements	<Click Here>	Statements of assets and liabilities, operations, and changes in net assets, as well as financial highlights.
Notes	<Click Here>	Notes to the financial statements.
Report of Independent Registered Public Accounting Firm	<Click Here>
Trustees and Officers	<Click Here>
Distributions	<Click Here>
Board Approval of Investment Advisory Contracts and Management Fees	<Click Here>

Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.

Other third party marks appearing herein are the property of their respective owners.

All other marks appearing herein are registered or unregistered trademarks or service marks of FMR Corp. or an affiliated company.

Annual Report

NOT FDIC INSURED· MAY LOSE VALUE· NO BANK GUARANTEE

Neither the fund nor Fidelity Distributors Corporation is a bank.

Annual Report

Chairman's Message

(photo_of_Edward_C_Johnson_3d)

Dear Shareholder:

Sincerely,

/s/Edward C. Johnson 3d

Edward C. Johnson 3d

Annual Report

Performance: The Bottom Line

Average Annual Total Returns

Periods ended October 31, 2006		Past 1 year	Past 5 years	Past 10 years
<R>Institutional Class</R>		<R>5.73%</R>	<R>5.31%</R>	<R>6.06%</R>

$10,000 Over 10 Years

Let's say hypothetically that $10,000 was invested in Fidelity ® Advisor Municipal Income Fund - Institutional Class on October 31, 1996. The chart shows how the value of your investment would have changed, and also shows how the Lehman Brothers ® Municipal Bond Index performed over the same period.

Annual Report

Management's Discussion of Fund Performance

Comments from Christine Thompson, Portfolio Manager of Fidelity® Advisor Municipal Income Fund

During the past year, the fund's Institutional Class shares returned 5.73%, while the Lehman Brothers 3 Plus Year Municipal Bond Index gained 6.07%. Benefiting fund returns versus the index were my comparatively large stake in lower-quality, investment-grade securities and a modest out-of-index exposure to below-investment-grade bonds. These securities - generally issued by hospitals and electric utilities - were boosted by a combination of their improved financial performance and strong investor demand for high-yielding securities. Performance also was helped by my overweighting in zero-coupon bonds, which make no interest payments but are sold at a discount from their face values. Zeros generally performed better than coupon-bearing bonds. An overweighting relative to the index in prerefunded bonds also worked in the fund's favor. Prerefunding produced relatively strong returns as the bonds' maturities became shorter and their credit quality was upgraded. Detracting from performance relative to the index was my decision to underweight discount bonds, which are securities that trade below par - meaning face value - while overweighting premium bonds, which trade above par. Discounts outpaced premiums as investors sought out their higher nominal yields.

Annual Report

Shareholder Expense Example

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (May 1, 2006 to October 31, 2006).

Actual Expenses

Hypothetical Example for Comparison Purposes

	Beginning Account Value May 1, 2006	Ending Account Value October 31, 2006	Expenses Paid During Period * May 1, 2006 to October 31, 2006
Class A
Actual	$ 1,000.00	$ 1,040.60	$ 3.45
Hypothetical ^A	$ 1,000.00	$ 1,021.83	$ 3.41
Class T
Actual	$ 1,000.00	$ 1,040.00	$ 3.96
Hypothetical ^A	$ 1,000.00	$ 1,021.32	$ 3.92
Class B
Actual	$ 1,000.00	$ 1,036.80	$ 7.29
Hypothetical ^A	$ 1,000.00	$ 1,018.05	$ 7.22
	Beginning Account Value May 1, 2006	Ending Account Value October 31, 2006	Expenses Paid During Period * May 1, 2006 to October 31, 2006
Class C
Actual	$ 1,000.00	$ 1,036.20	$ 7.75
Hypothetical ^A	$ 1,000.00	$ 1,017.59	$ 7.68
Institutional Class
Actual	$ 1,000.00	$ 1,041.50	$ 2.78
Hypothetical ^A	$ 1,000.00	$ 1,022.48	$ 2.75

^A5% return per year before expenses

	Annualized Expense Ratio
Class A	.67%
Class T	.77%
Class B	1.42%
Class C	1.51%
Institutional Class	.54%

Annual Report

Investment Changes

Top Five States as of October 31, 2006
	% of fund's net assets	% of fund's net assets 6 months ago
Texas	13.2	15.2
New York	12.0	9.3
California	11.2	11.2
Illinois	10.5	10.3
Washington	7.1	7.5
Top Five Sectors as of October 31, 2006
	% of fund's net assets	% of fund's net assets 6 months ago
General Obligations	37.8	37.1
Health Care	11.0	10.1
Electric Utilities	9.2	8.4
Transportation	8.9	8.5
Escrowed/Pre-Refunded	7.7	9.1
Average Years to Maturity as of October 31, 2006
		6 months ago
Years	15.2	15.3

Average years to maturity is based on the average time remaining to the stated maturity date of each bond, weighted by the market value of each bond.

Duration as of October 31, 2006
		6 months ago
Years	6.5	6.6

Quality Diversification (% of fund's net assets)
As of October 31, 2006		As of April 30, 2006
	AAA 61.8%		AAA 63.7%
	AA,A 28.1%		AA,A 23.9%
	BBB 8.1%		BBB 6.6%
	BB and Below 0.2%		BB and Below 0.2%
	Not Rated 1.0%		Not Rated 1.3%
	Short-Term Investments and Net Other Assets 0.8%		Short-Term Investments and Net Other Assets 4.3%

We have used ratings from Moody's® Investors Services, Inc. Where Moody's ratings are not available, we have used S&P® ratings.

Annual Report

Investments October 31, 2006

Showing Percentage of Net Assets

Municipal Bonds - 99.3%
	Principal Amount		Value (Note 1)
Alabama - 0.0%
Birmingham Wtrwks. & Swr. Board Wtr. & Swr. Rev. Series B, 5% 1/1/43 (MBIA Insured)	$ 300,000		$ 310,914
Alaska - 0.2%
Alaska Student Ln. Corp. Student Ln. Rev. Series A, 5.45% 7/1/09 (AMBAC Insured) (d)	1,500,000		1,517,595
Arizona - 1.4%
Arizona Student Ln. Acquisition Auth. Student Ln. Rev. Series A1, 5.875% 5/1/18 (d)	1,300,000		1,377,948
Chandler Indl. Dev. Auth. Indl. Dev. Rev. (Intel Corp. Proj.) 4.375%, tender 12/1/10 (c)(d)	1,000,000		1,019,650
Glendale Indl. Dev. Auth. Hosp. Rev. (John C. Lincoln Health Network Proj.) 5% 12/1/29	1,575,000		1,627,164
Phoenix Civic Impt. Corp. Wtr. Sys. Rev. 5% 7/1/29 (MBIA Insured)	1,000,000		1,063,500
Phoenix Indl. Dev. Auth. Single Family Mtg. Rev. 0% 12/1/14 (Escrowed to Maturity) (e)	3,750,000		2,747,100
Univ. of Arizona Univ. Revs. Series 2005 A, 5% 6/1/17 (AMBAC Insured)	1,000,000		1,087,110
			8,922,472
Arkansas - 0.2%
Little Rock School District Series 2001 C, 5.25% 2/1/33 (FSA Insured)	1,000,000		1,047,490
California - 11.2%
California Dept. of Wtr. Resources Pwr. Supply Rev. Series A, 5.5% 5/1/15 (AMBAC Insured)	1,000,000		1,100,600
California Econ. Recovery:
Series 2004 A, 5.25% 7/1/13	2,100,000		2,304,792
Series A:
5% 7/1/15 (MBIA Insured)	1,800,000		1,969,848
5.25% 7/1/14	1,500,000		1,661,175
5.25% 7/1/14 (FGIC Insured)	900,000		999,882
California Gen. Oblig.:
5% 3/1/15	1,000,000		1,089,400
5% 12/1/31 (MBIA Insured)	1,400,000		1,473,864
5.125% 11/1/24	600,000		638,196
5.25% 2/1/14	2,400,000		2,629,104
5.25% 2/1/15	1,200,000		1,314,552
5.25% 2/1/16	1,000,000		1,094,830
5.25% 2/1/24	1,000,000		1,071,970
5.25% 2/1/28	1,200,000		1,280,520
5.25% 2/1/33	2,000,000		2,115,300
5.25% 12/1/33	2,300,000		2,464,519
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
California - continued
California Gen. Oblig.: - continued
5.25% 4/1/34	$ 2,200,000		$ 2,352,944
5.5% 4/1/30	3,565,000		3,924,102
5.5% 11/1/33	5,400,000		5,910,624
5.625% 5/1/20	80,000		85,899
California Pub. Works Board Lease Rev.:
(Richmond Lab., Phase III Office Bldg. Proj.) Series B, 5.25% 11/1/25 (XL Cap. Assurance, Inc. Insured)	2,585,000		2,818,917
Series 2005 A, 5.25% 6/1/30	2,000,000		2,139,480
Series 2005 H, 5% 6/1/18	1,425,000		1,530,778
Series 2005 K, 5% 11/1/17	2,300,000		2,486,760
California Statewide Cmntys. Dev. Auth. Poll. Cont. Rev. (Southern California Edison Co.) 4.1%, tender 4/1/13 (XL Cap. Assurance, Inc. Insured) (c)	1,300,000		1,330,901
California Statewide Cmntys. Dev. Auth. Rev. (Kaiser Fund Hosp./Health Place, Inc. Proj.) Series 2002 C, 3.85%, tender 6/1/12 (c)	500,000		500,735
Foothill/Eastern Trans. Corridor Agcy. Toll Road Rev.:
Series A, 5% 1/1/35 (MBIA Insured)	700,000		719,299
5% 1/15/16 (MBIA Insured)	400,000		421,700
5.75% 1/15/40	600,000		624,546
Golden State Tobacco Securitization Corp.:
Series 2003 A1, 6.75% 6/1/39	1,450,000		1,662,309
Series A, 5% 6/1/45	6,650,000		6,856,815
Los Angeles Dept. of Wtr. & Pwr. Wtrwks. Rev.:
Series 2001 A, 5.125% 7/1/41	4,000,000		4,144,640
Series A, 5.125% 7/1/41 (MBIA Insured)	1,300,000		1,352,585
Los Angeles Unified School District Series A, 5.375% 7/1/17 (Pre-Refunded to 7/1/13 @ 100) (e)	835,000		927,268
Oxnard Fing. Auth. Wastewtr. Rev. (Redwood Trunk Swr. and Headworks Proj.) Series A, 5% 6/1/29 (FGIC Insured)	1,000,000		1,053,550
San Diego Unified School District:
(Election of 1998 Proj.) Series E2, 5.5% 7/1/26 (FSA Insured)	2,300,000		2,728,168
Series F, 5% 7/1/29 (FSA Insured)	400,000		423,172
Southern California Pub. Pwr. Auth. Rev. (Magnolia Pwr. Proj.) Series A, 5% 7/1/36 (AMBAC Insured)	1,000,000		1,047,250
Univ. of California Revs. (UCLA Med. Ctr. Proj.) Series A:
5.5% 5/15/18 (AMBAC Insured)	1,755,000		1,938,117
5.5% 5/15/20 (AMBAC Insured)	2,000,000		2,198,100
			72,387,211
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Colorado - 1.8%
Colorado Health Facilities Auth. Retirement Hsg. Rev. (Liberty Heights Proj.) 0% 7/15/22 (Escrowed to Maturity) (e)	$ 1,365,000		$ 697,133
Colorado Health Facilities Auth. Rev. (Longmont Hosp. Proj.) Series B, 5.25% 12/1/13 (Radian Asset Assurance Ltd. Insured)	860,000		930,073
Colorado Springs Arpt. Rev. Series C, 0% 1/1/08 (MBIA Insured)	870,000		833,834
Colorado Wtr. Resources and Pwr. Dev. Auth. Clean Wtr. Rev. Series 2001 A:
5.625% 9/1/13	235,000		255,936
5.625% 9/1/14	230,000		250,277
Colorado Wtr. Resources and Pwr. Dev. Auth. Wtr. Resources Rev. (Parker Wtr. and Sanitation District Proj.) Series D, 5.25% 9/1/43 (MBIA Insured)	4,600,000		4,938,146
Dawson Ridge Metropolitan District #1 Series 1992 A, 0% 10/1/17 (Escrowed to Maturity) (e)	1,200,000		765,048
E-470 Pub. Hwy. Auth. Rev. Series 2000 A, 5.75% 9/1/29 (MBIA Insured)	1,200,000		1,308,288
Mesa County Residual Rev. 0% 12/1/11 (Escrowed to Maturity) (e)	2,275,000		1,876,375
			11,855,110
Connecticut - 0.5%
Eastern Connecticut Resources Recovery Auth. Solid Waste Rev. (Wheelabrator Lisbon Proj.) Series A, 5.5% 1/1/20 (d)	3,350,000		3,352,211
District Of Columbia - 2.1%
District of Columbia Gen. Oblig.:
Series A, 6% 6/1/07 (Escrowed to Maturity) (e)	10,000		10,144
Series B:
0% 6/1/12 (MBIA Insured)	1,200,000		962,676
5.25% 6/1/26 (FSA Insured)	6,000,000		6,218,340
District of Columbia Rev.:
(George Washington Univ. Proj.) Series A, 5.75% 9/15/20 (MBIA Insured)	1,490,000		1,585,271
(Georgetown Univ. Proj.) Series A, 5.95% 4/1/14 (MBIA Insured)	2,000,000		2,098,940
(Nat'l. Academy of Sciences Proj.) Series A, 5% 1/1/19 (AMBAC Insured)	2,500,000		2,610,300
			13,485,671
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Florida - 2.1%
Flagler County School Board Ctfs. Series A, 5% 8/1/12 (FSA Insured)	$ 1,000,000		$ 1,061,350
Florida Board of Ed. Cap. Outlay Series B, 5.5% 6/1/16 (FGIC Insured)	1,000,000		1,100,740
Florida Correctional Privatization Communications Ctfs. of Prtn. Series A, 5% 8/1/15 (AMBAC Insured)	1,000,000		1,078,410
Highlands County Health Facilities Auth. Rev. (Adventist Health Sys./Sunbelt Obligated Group Proj.):
Series B, 5% 11/15/14	1,000,000		1,068,820
3.95%, tender 9/1/12 (c)	2,100,000		2,099,916
5%, tender 11/16/09 (c)	1,800,000		1,858,752
JEA Elec. Sys. Rev. Series 3A, 5% 10/1/41 (FSA Insured)	1,000,000		1,051,090
Miami-Dade County Aviation Rev. (Miami Int'l. Arpt. Proj.) Series B, 5% 10/1/37 (FGIC Insured)	1,000,000		1,049,910
Miami-Dade County School District 5% 2/15/14 (MBIA Insured) (b)	1,600,000		1,721,904
Palm Beach County School Board Ctfs. of Prtn. Series C, 5% 8/1/27 (FSA Insured)	1,050,000		1,092,410
Seminole County School Board Ctfs. of Prtn. Series A, 5% 7/1/20 (MBIA Insured)	500,000		536,650
			13,719,952
Georgia - 2.8%
Atlanta Arpt. Rev. Series F, 5.25% 1/1/13 (FSA Insured) (d)	1,000,000		1,073,820
Atlanta Wtr. & Wastewtr. Rev.:
5% 11/1/37 (FSA Insured)	2,400,000		2,525,904
5% 11/1/43 (FSA Insured)	9,070,000		9,514,430
Augusta Wtr. & Swr. Rev. 5.25% 10/1/39 (FSA Insured)	2,200,000		2,387,946
Colquitt County Dev. Auth. Rev. Series A, 0% 12/1/21 (Escrowed to Maturity) (e)	1,100,000		584,672
Richmond County Dev. Auth. Rev. Series C, 0% 12/1/21 (Escrowed to Maturity) (e)	1,190,000		632,509
Savannah Econ. Dev. Auth. Rev. (Southern Care Corp. Proj.) Series C, 0% 12/1/21 (Escrowed to Maturity) (e)	2,500,000		1,328,800
			18,048,081
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Hawaii - 0.4%
Hawaii Arpt. Sys. Rev. Series 2000 B, 8% 7/1/11 (FGIC Insured) (d)	$ 1,300,000		$ 1,525,667
Honolulu City & County Board of Wtr. Supply Wtr. Sys. Rev. Series B, 5.25% 7/1/17 (MBIA Insured) (d)	1,250,000		1,367,825
			2,893,492
Illinois - 10.5%
Chicago Board of Ed.:
(Westinghouse High School Proj.) Series C, 5.25% 12/1/19 (MBIA Insured)	1,300,000		1,422,642
Series A, 0% 12/1/16 (FGIC Insured)	1,300,000		867,022
Chicago Gen. Oblig.:
(City Colleges Proj.):
0% 1/1/16 (FGIC Insured)	6,125,000		4,223,126
0% 1/1/24 (FGIC Insured)	6,110,000		2,919,541
(Neighborhoods Alive 21 Prog.) 5% 1/1/43 (AMBAC Insured)	1,000,000		1,040,190
Series A:
5% 1/1/42 (AMBAC Insured)	1,700,000		1,759,143
5.25% 1/1/33 (MBIA Insured)	1,070,000		1,125,608
5.25% 1/1/33 (Pre-Refunded to 1/1/11 @ 101) (e)	30,000		32,239
5.5% 1/1/38 (MBIA Insured)	255,000		273,401
5.5% 1/1/38 (Pre-Refunded to 1/1/11 @ 101) (e)	10,000		10,842
5.5% 1/1/40 (FGIC Insured)	525,000		559,409
Chicago Midway Arpt. Rev. Series B, 6% 1/1/09 (MBIA Insured) (d)	300,000		303,942
Chicago O'Hare Int'l. Arpt. Rev.:
Series A:
5.5% 1/1/16 (AMBAC Insured) (d)	900,000		920,358
6.25% 1/1/09 (AMBAC Insured) (d)	3,325,000		3,404,534
5.5% 1/1/09 (AMBAC Insured) (d)	1,250,000		1,293,625
Chicago Park District Series A, 5.5% 1/1/19 (FGIC Insured)	155,000		165,046
Chicago Transit Auth. Cap. Grant Receipts Rev. 5% 6/1/21 (AMBAC Insured) (b)	1,400,000		1,512,434
Cook County Gen. Oblig. Series C, 5% 11/15/25 (AMBAC Insured)	1,100,000		1,157,827
DuPage County Cmnty. High School District #108, Lake Park 5.6% 1/1/17 (FSA Insured)	3,190,000		3,526,577
Evanston Gen. Oblig. Series C, 5.25% 1/1/20	1,500,000		1,611,900
Granite City Solid Waste Disp. Rev. (Waste Mgmt., Inc. Proj.) 3.85%, tender 5/1/08 (c)(d)	2,810,000		2,783,080
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Illinois - continued
Illinois Dev. Fin. Auth. Retirement 0% 7/15/23 (Escrowed to Maturity) (e)	$ 2,900,000		$ 1,386,925
Illinois Edl. Facilities Auth. Revs. (Northwestern Univ. Proj.) 5% 12/1/38	900,000		939,735
Illinois Gen. Oblig.:
First Series, 5.75% 12/1/18 (MBIA Insured)	1,000,000		1,075,330
Series 2006, 5.5% 1/1/31	1,000,000		1,218,560
5.5% 4/1/17 (MBIA Insured)	1,000,000		1,056,820
5.6% 4/1/21 (MBIA Insured)	1,000,000		1,057,700
Illinois Health Facilities Auth. Rev.:
(Condell Med. Ctr. Proj.) 6.5% 5/15/30	3,000,000		3,203,340
(Decatur Memorial Hosp. Proj.) Series 2001, 5.75% 10/1/24	2,100,000		2,211,594
(Lake Forest Hosp. Proj.) 6% 7/1/33	1,000,000		1,081,850
(Riverside Health Sys. Proj.) 6.8% 11/15/20 (Pre-Refunded to 11/15/10 @ 101) (e)	1,500,000		1,692,885
Illinois Sales Tax Rev.:
First Series 2001, 5.5% 6/15/13	3,250,000		3,503,175
6% 6/15/20	600,000		646,074
Joliet School District #86 Gen. Oblig. Cap. Appreciation 0% 11/1/19 (FSA Insured)	2,000,000		1,160,920
Kane, McHenry, Cook & DeKalb Counties Cmnty. Unit School District #300, Carpentersville 0% 12/1/17 (AMBAC Insured)	1,000,000		632,500
Lake County Cmnty. High School District #117, Antioch Series B, 0% 12/1/20 (FGIC Insured)	1,805,000		994,411
Lake County Warren Township High School District #121, Gurnee Series C, 5.5% 3/1/23 (AMBAC Insured)	1,795,000		1,998,445
Metropolitan Pier & Exposition Auth. Dedicated State Tax Rev. (McCormick Place Expansion Proj.):
Series 2002 A, 5.75% 6/15/41 (MBIA Insured)	3,300,000		3,617,691
Series A:
0% 6/15/16 (FGIC Insured)	2,370,000		1,613,235
0% 6/15/19 (MBIA Insured)	3,710,000		2,198,657
0% 6/15/22 (MBIA Insured)	1,060,000		546,292
0% 12/15/24 (MBIA Insured)	3,090,000		1,422,049
Ogle, Lee & DeKalb Counties Township High School District #212 6% 12/1/16 (MBIA Insured)	60,000		66,304
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Illinois - continued
Univ. of Illinois Auxiliary Facilities Sys. Rev. 0% 4/1/15 (MBIA Insured)	$ 3,700,000		$ 2,653,899
Will County Forest Preservation District Series B, 0% 12/1/14 (FGIC Insured)	1,000,000		729,660
			67,620,537
Indiana - 3.4%
Crown Point Multi-School Bldg. Corp. 5% 1/15/20 (FGIC Insured)	1,260,000		1,353,656
Franklin Township Independent School Bldg. Corp., Marion County 5.25% 7/15/16 (MBIA Insured)	1,790,000		1,980,653
Hamilton Heights School Bldg. Corp. 5.25% 7/15/17 (FSA Insured)	1,910,000		2,131,923
Hobart Bldg. Corp. 6.5% 1/15/29 (FGIC Insured)	2,600,000		3,246,178
Indiana Health & Edl. Facilities Fing. Auth. Hosp. Rev. (Clarian Health Partners, Inc. Proj.) Series B, 5% 2/15/11	1,500,000		1,572,870
Indiana Health Facility Fing. Auth. Rev. (Sisters of Saint Francis Health Svc. Proj.) 5.5% 11/1/31 (Pre-Refunded to 11/1/11 @ 101) (e)	1,500,000		1,646,820
Indiana Trans. Fin. Auth. Hwy. Series A, 0% 6/1/17 (AMBAC Insured)	1,000,000		646,260
Indiana Univ. Student Fee Revs. Series H, 0% 8/1/09 (AMBAC Insured)	1,600,000		1,442,960
Indianapolis Local Pub. Impt. Bond Bank (Indianapolis Arpt. Auth. Proj.) Series 2006 F, 5% 1/1/16 (AMBAC Insured) (d)	1,000,000		1,074,430
North Adams Cmnty. Schools Renovation Bldg. Corp. 0% 1/15/17 (FSA Insured)	1,230,000		806,585
Petersburg Poll. Cont. Rev. 5.95% 12/1/29 (d)	2,000,000		2,142,760
Portage Township Multi-School Bldg. Corp. 5.25% 7/15/26 (MBIA Insured)	1,195,000		1,295,547
Rockport Poll. Cont. Rev. (AEP Generating Co. Proj.) Series 1995 A, 4.15%, tender 7/15/11 (AMBAC Insured) (c)	1,000,000		1,020,940
South Harrison School Bldg. Corp. Series A, 5.25% 1/15/25 (FSA Insured)	1,150,000		1,248,751
			21,610,333
Iowa - 0.7%
Tobacco Settlement Auth. Tobacco Settlement Rev. 5.3% 6/1/25 (Pre-Refunded to 6/1/11 @ 101) (e)	4,000,000		4,263,440
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Kansas - 1.8%
Burlington Envir. Impt. Rev. (Kansas City Pwr. & Lt. Co. Proj.) Series A, 4.75%, tender 10/1/07 (c)	$ 1,000,000		$ 1,008,840
Kansas Dev. Fin. Auth. Health Facilities Rev.:
(Hays Med. Ctr. Proj.) Series 2005 L:
5.25% 11/15/15	335,000		363,833
5.25% 11/15/16	955,000		1,037,197
(Sisters of Charity of Leavenworth Health Svcs. Corp. Proj.) Series J, 6.25% 12/1/28	1,500,000		1,642,290
Kansas Dev. Fin. Auth. Rev. (Sisters of Charity of Leavenworth Health Svcs. Corp. Proj.):
5% 12/1/13 (MBIA Insured)	2,390,000		2,456,346
5% 12/1/14 (MBIA Insured)	500,000		513,880
5.25% 12/1/09 (MBIA Insured)	1,420,000		1,467,016
5.25% 12/1/11 (MBIA Insured)	1,750,000		1,807,120
Lawrence Hosp. Rev. 5.25% 7/1/18	1,000,000		1,085,100
			11,381,622
Kentucky - 0.4%
Louisville & Jefferson County Metropolitan Swr. District Swr. & Drain Sys. Rev. Series A, 5.25% 5/15/37 (FGIC Insured)	2,170,000		2,356,577
Louisiana - 0.4%
Louisiana Military Dept. 5% 8/1/14	1,730,000		1,825,271
New Orleans Gen. Oblig. 0% 9/1/15 (AMBAC Insured)	700,000		480,410
Tobacco Settlement Fing. Corp. Series 2001 B, 5.5% 5/15/30	420,000		440,467
			2,746,148
Maine - 0.2%
Maine Tpk. Auth. Tpk. Rev. 5.25% 7/1/30 (FSA Insured)	1,000,000		1,081,040
Maryland - 0.5%
Maryland Health & Higher Edl. Facilities Auth. Rev. (Good Samaritan Hosp. Proj.):
5.75% 7/1/13 (Escrowed to Maturity) (e)	1,665,000		1,821,294
5.75% 7/1/13 (Escrowed to Maturity) (e)	1,015,000		1,110,278
			2,931,572
Massachusetts - 3.6%
Massachusetts Gen. Oblig.:
Series 2005 C, 5.25% 9/1/23 (Pre-Refunded to 9/1/15 @ 100) (e)	2,800,000		3,130,876
Series D, 5.25% 10/1/22 (Pre-Refunded to 10/1/13 @ 100) (e)	1,200,000		1,312,476
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Massachusetts - continued
Massachusetts Health & Edl. Facilities Auth. Rev. (New England Med. Ctr. Hosp. Proj.) Series G, 5.375% 7/1/24 (MBIA Insured)	$ 500,000		$ 500,305
Massachusetts Indl. Fin. Agcy. Rev. (Massachusetts Biomedical Research Corp. Proj.) Series A2:
0% 8/1/08	800,000		749,928
0% 8/1/10	4,500,000		3,879,765
Massachusetts School Bldg. Auth. Dedicated Sales Tax Rev. Series A:
5% 8/15/23 (FSA Insured)	5,000,000		5,351,650
5% 8/15/30 (FSA Insured)	4,500,000		4,772,070
Massachusetts Wtr. Poll. Abatement Trust Wtr. Poll. Abatement Rev. (MWRA Ln. Prog.) Series A, 5.25% 8/1/13	10,000		10,373
Springfield Gen. Oblig. 5% 8/1/20 (MBIA Insured)	3,335,000		3,581,390
			23,288,833
Michigan - 1.1%
Ferris State Univ. Rev. 5% 10/1/19 (MBIA Insured)	1,440,000		1,535,774
Michigan Hosp. Fin. Auth. Hosp. Rev. (McLaren Health Care Corp. Proj.) Series A, 5% 6/1/19	2,000,000		2,052,100
Royal Oak Hosp. Fin. Auth. Hosp. Rev. (William Beaumont Hosp. Proj.) 6.25% 1/1/09	2,310,000		2,427,186
Willow Run Cmnty. Schools County of Washtenaw 5% 5/1/20 (FSA Insured)	1,000,000		1,067,700
			7,082,760
Minnesota - 1.7%
Minneapolis & Saint Paul Hsg. & Redev. Auth. Health Care Sys. Rev. (Healthspan Corp. Proj.) Series A, 4.75% 11/15/18 (AMBAC Insured)	1,800,000		1,800,918
Minneapolis & Saint Paul Metropolitan Arpts. Commission Arpt. Rev. Series 2001 C, 5.25% 1/1/32 (FGIC Insured)	1,000,000		1,052,520
Minneapolis Health Care Sys. Rev. (Allina Health Sys. Proj.) Series 2002 A, 6% 11/15/23	1,000,000		1,105,130
North St. Paul-Maplewood-Oakdale Independent School District 622 5% 2/1/15 (FSA Insured) (b)	1,425,000		1,552,352
Rochester Health Care Facilities Rev. (Mayo Foundation Proj.) Series A, 5.5% 11/15/27	590,000		612,426
Saint Cloud Health Care Rev. (Saint Cloud Hosp. Group Oblig. Proj.) Series A, 5.875% 5/1/30 (FSA Insured)	2,000,000		2,148,740
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Minnesota - continued
Saint Paul Port Auth. Lease Rev.:
(HealthEast Midway Campus Proj.) Series 2003 A, 5.875% 5/1/30	$ 1,400,000		$ 1,463,854
Series 2003 11, 5.25% 12/1/18	1,000,000		1,082,760
			10,818,700
Missouri - 0.2%
Missouri Envir. Impt. & Energy Resources Auth. Wtr. Poll. Cont. & Drinking Wtr. Rev. (State Revolving Fund Prog.) Series 2003 A, 5.125% 1/1/21	1,010,000		1,081,700
Montana - 0.4%
Forsyth Poll. Cont. Rev. (Portland Gen. Elec. Co. Proj.) Series A, 5.2%, tender 5/1/09 (c)	1,500,000		1,537,350
Montana Board of Regents Higher Ed. Rev. (Montana State Univ. Proj.) 5% 11/15/34 (AMBAC Insured)	1,000,000		1,058,950
			2,596,300
Nevada - 0.5%
Clark County Arpt. Rev. Series C, 5.375% 7/1/22 (AMBAC Insured) (d)	1,000,000		1,065,800
Las Vegas Valley Wtr. District Series B:
5.25% 6/1/16 (MBIA Insured)	1,000,000		1,083,640
5.25% 6/1/17 (MBIA Insured)	1,000,000		1,080,820
			3,230,260
New Hampshire - 0.2%
New Hampshire Bus. Fin. Auth. Poll. Cont. Rev. (United Illumination Co.) Series A, 3.65%, tender 2/1/10 (AMBAC Insured) (c)(d)	1,000,000		987,610
New Jersey - 2.9%
New Jersey Econ. Dev. Auth. Rev. Series 2005 O:
5.25% 3/1/21 (MBIA Insured)	1,000,000		1,092,180
5.25% 3/1/23	2,000,000		2,168,100
5.25% 3/1/25	1,500,000		1,621,680
5.25% 3/1/26	915,000		988,548
New Jersey Tpk. Auth. Tpk. Rev. Series A, 5% 1/1/25 (FSA Insured)	900,000		960,156
New Jersey Trans. Trust Fund Auth. Series B, 5.25% 12/15/22 (AMBAC Insured)	400,000		457,928
Tobacco Settlement Fing. Corp.:
4.375% 6/1/19	1,990,000		1,991,294
6.125% 6/1/24	3,500,000		3,797,535
6.125% 6/1/42	1,600,000		1,740,560
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
New Jersey - continued
Tobacco Settlement Fing. Corp.: - continued
6.375% 6/1/32	$ 1,400,000		$ 1,562,246
6.75% 6/1/39	835,000		954,672
Union County Impt. Auth. (Juvenile Detention Ctr. Facility Proj.) 5.5% 5/1/28 (FGIC Insured)	1,000,000		1,111,690
			18,446,589
New Mexico - 1.2%
Albuquerque Arpt. Rev.:
6.7% 7/1/18 (AMBAC Insured) (d)	3,970,000		4,116,334
6.75% 7/1/09 (AMBAC Insured) (d)	450,000		481,617
6.75% 7/1/11 (AMBAC Insured) (d)	1,805,000		2,006,745
New Mexico Edl. Assistance Foundation Student Ln. Rev. Series IV A2, 6.65% 3/1/07	1,000,000		1,009,580
			7,614,276
New York - 12.0%
Erie County Indl. Dev. Agcy. School Facility Rev. (Buffalo City School District Proj.):
Series 2003:
5.75% 5/1/16 (FSA Insured)	1,500,000		1,675,170
5.75% 5/1/21 (FSA Insured)	1,200,000		1,318,800
Series 2004:
5.75% 5/1/21 (FSA Insured)	4,900,000		5,552,239
5.75% 5/1/25 (FSA Insured)	600,000		676,098
Long Island Pwr. Auth. Elec. Sys. Rev. 5% 12/1/26 (XL Cap. Assurance, Inc. Insured)	1,400,000		1,495,494
Metropolitan Trans. Auth. Rev.:
Series A, 5.75% 11/15/32	4,300,000		4,738,514
Series F, 5.25% 11/15/27 (MBIA Insured)	500,000		539,315
Metropolitan Trans. Auth. Svc. Contract Rev. Series 7, 5.625% 7/1/16 (Escrowed to Maturity) (e)	1,000,000		1,000,800
New York City Gen. Oblig.:
Series 2005 G:
5% 8/1/14	3,600,000		3,889,764
5% 8/1/15	1,000,000		1,086,190
Series A, 5.25% 11/1/14 (MBIA Insured)	600,000		649,908
Series C, 5.75% 3/15/27 (Pre-Refunded to 3/15/12 @ 100) (e)	135,000		149,669
Series J, 5.5% 6/1/19	1,100,000		1,206,557
Subseries 2005 F1, 5.25% 9/1/14	1,200,000		1,317,648
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
New York - continued
New York City Indl. Dev. Agcy. Indl. Dev. Rev. (Japan Airlines Co. Ltd. Proj.) Series 1991, 6% 11/1/15 (FSA Insured) (d)	$ 705,000		$ 712,826
New York City Indl. Dev. Agcy. Spl. Facilities Rev. (Terminal One Group Assoc. Proj.) 5% 1/1/09 (d)	1,000,000		1,021,080
New York City Muni. Wtr. Fin. Auth. Wtr. & Swr. Sys. Rev.:
Series 2002 A, 5.125% 6/15/34 (FSA Insured)	500,000		527,250
Series A, 5.125% 6/15/34 (MBIA Insured)	2,000,000		2,109,000
Series E, 5% 6/15/34	1,600,000		1,671,328
New York City Trust Cultural Resources Rev. (Museum of Modern Art Proj.) Series 2001 D, 5.125% 7/1/31 (AMBAC Insured)	1,000,000		1,060,070
New York State Dorm. Auth. Revs.:
(City Univ. Sys. Consolidation Proj.):
Series A, 5.75% 7/1/13	1,500,000		1,640,955
Series C, 7.5% 7/1/10	360,000		386,741
(The Jamaica Hosp. Proj.) Series F, 5.2% 2/15/14 (MBIA Insured)	3,950,000		4,087,974
Series 2002 A, 5.75% 10/1/17 (MBIA Insured)	1,000,000		1,105,120
New York State Envir. Facilities Corp. Clean Wtr. & Drinking Wtr. Rev. Series F:
4.875% 6/15/18	870,000		894,203
4.875% 6/15/20	795,000		815,980
5% 6/15/15	305,000		314,418
New York State Thruway Auth. Gen. Rev. Series 2005 G, 5.25% 1/1/27 (FSA Insured)	1,600,000		1,753,696
New York State Thruway Auth. Svc. Contract Rev. 5.5% 4/1/16	305,000		332,157
New York Transitional Fin. Auth. Rev.:
Series 2004 C, 5% 2/1/33 (FGIC Insured)	1,000,000		1,057,140
Series A:
5.75% 2/15/16	10,000		10,784
6% 11/1/28 (a)	2,000,000		2,207,060
Series B:
5% 8/1/32	1,300,000		1,364,350
5.25% 2/1/29 (a)	2,000,000		2,122,240
Sales Tax Asset Receivables Corp. Series A, 5.25% 10/15/27 (AMBAC Insured)	1,500,000		1,634,040
Tobacco Settlement Asset Securitization Corp. Series 1, 5.5% 7/15/24 (Pre-Refunded to 7/15/12 @ 100) (e)	1,155,000		1,240,597
Tobacco Settlement Fing. Corp.:
Series 2003 C1, 5.5% 6/1/19	1,400,000		1,537,326
Series A1:
5.25% 6/1/21 (AMBAC Insured)	1,000,000		1,077,630
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
New York - continued
Tobacco Settlement Fing. Corp.: - continued
Series A1:
5.25% 6/1/22 (AMBAC Insured)	$ 950,000		$ 1,022,609
5.5% 6/1/14	1,200,000		1,256,220
5.5% 6/1/16	4,700,000		4,985,760
Series C1:
5.5% 6/1/14	400,000		418,740
5.5% 6/1/15	1,700,000		1,803,360
5.5% 6/1/16	1,000,000		1,076,440
5.5% 6/1/17	1,300,000		1,396,538
5.5% 6/1/18	1,800,000		1,956,222
5.5% 6/1/21	5,000,000		5,469,150
5.5% 6/1/22	1,500,000		1,638,015
			77,003,185
New York & New Jersey - 0.3%
Port Auth. of New York & New Jersey 124th Series, 5% 8/1/13 (FGIC Insured) (d)	500,000		513,660
Port Auth. of New York & New Jersey Spl. Oblig. Rev. (JFK Int'l. Air Term. Spl. Proj.) Series 6, 6.25% 12/1/13 (MBIA Insured) (d)	1,400,000		1,604,526
			2,118,186
North Carolina - 2.5%
Charlotte Ctfs. of Prtn. (2003 Govt. Facilities Projs.) Series G, 5% 6/1/33	1,000,000		1,043,190
Dare County Ctfs. of Prtn. 5.25% 6/1/15 (AMBAC Insured)	1,195,000		1,310,604
North Carolina Cap. Facilities Fin. Agcy. Rev. (Duke Univ. Proj.) Series A:
5.125% 10/1/41	1,745,000		1,820,611
5.125% 7/1/42	5,155,000		5,415,895
5.25% 7/1/42	1,300,000		1,377,727
North Carolina Eastern Muni. Pwr. Agcy. Pwr. Sys. Rev.:
Series A, 5.5% 1/1/11	1,575,000		1,669,595
Series D, 6.7% 1/1/19	1,115,000		1,218,539
North Carolina Infrastructure Fin. Corp. Ctfs. of Prtn. (North Carolina Correctional Facilities Proj.) Series A, 5% 2/1/18	1,000,000		1,064,880
Union County Ctfs. Prtn. 5% 6/1/18 (AMBAC Insured) (b)	1,305,000		1,412,271
			16,333,312
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
North Dakota - 0.2%
Ward County Health Care Facility Rev. (Trinity Med. Ctr. Proj.) 5.125% 7/1/17 (b)	$ 1,210,000		$ 1,290,138
Ohio - 0.5%
Cincinnati Student Ln. Fdg. Corp. Student Ln. Rev. Series B, 8.875% 8/1/08 (d)	1,005,000		1,007,121
Franklin County Hosp. Rev. 5.5% 5/1/21 (Pre-Refunded to 5/1/11 @ 101) (e)	1,500,000		1,634,640
Plain Local School District 6% 12/1/25 (FGIC Insured)	410,000		448,278
			3,090,039
Oklahoma - 1.6%
Oklahoma City Pub. Property Auth. Hotel Tax Rev.:
5.25% 10/1/29 (FGIC Insured)	1,000,000		1,092,110
5.5% 10/1/21 (FGIC Insured)	1,695,000		1,893,383
Oklahoma Industries Auth. Rev. (Health Sys. Oblig. Group Proj.) Series A:
5.75% 8/15/29 (MBIA Insured)	865,000		912,186
6% 8/15/19 (MBIA Insured)	1,740,000		1,859,086
6% 8/15/19 (Pre-Refunded to 8/15/09 @ 101) (e)	1,260,000		1,350,040
Tulsa Indl. Auth. Rev. (Univ. of Tulsa Proj.) Series 2000 A, 5.75% 10/1/25 (Pre-Refunded to 10/1/10 @ 100) (e)	3,000,000		3,241,200
			10,348,005
Oregon - 0.5%
Oregon Dept. Administrative Svcs. Ctfs. of Prtn. Series A, 5.375% 5/1/15 (AMBAC Insured)	1,715,000		1,865,320
Yamhill County School District #029J Newberg 5.5% 6/15/19 (FGIC Insured)	1,000,000		1,158,200
			3,023,520
Pennsylvania - 3.1%
Annville-Cleona School District 5.5% 3/1/22 (FSA Insured)	1,250,000		1,399,463
Canon McMillan School District:
Series 2001 B, 5.75% 12/1/33 (FGIC Insured)	1,000,000		1,074,160
Series 2002 B, 5.75% 12/1/35 (FGIC Insured)	1,595,000		1,751,438
Delaware County Auth. College Rev. (Haverford College Proj.) 5.75% 11/15/29	3,500,000		3,770,760
Easton Area School District Series 2006, 7.75% 4/1/25 (FSA Insured)	700,000		911,848
Montgomery County Higher Ed. & Health Auth. Hosp. Rev. (Abington Memorial Hosp. Proj.) Series A, 6% 6/1/16 (AMBAC Insured)	1,860,000		2,169,634
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Pennsylvania - continued
Pennsylvania Econ. Dev. Fing. Auth. Exempt Facilities Rev.:
(Amtrak Proj.) Series 2001 A, 6.25% 11/1/31 (d)	$ 2,000,000		$ 2,174,360
(Shippingport Proj.) Series A, 4.35%, tender 6/1/10 (c)(d)	500,000		501,795
Pennsylvania Higher Edl. Facilities Auth. Rev. (Lafayette College Proj.) 6% 5/1/30	3,065,000		3,286,814
Westmoreland County Muni. Auth. Muni. Svc. Rev. Series A, 0% 8/15/21 (FGIC Insured)	5,000,000		2,661,900
			19,702,172
Puerto Rico - 0.7%
Puerto Rico Govt. Dev. Bank:
Series B, 5% 12/1/12	2,500,000		2,647,450
Series C, 5.25% 1/1/15 (d)	1,000,000		1,071,140
5% 12/1/10	1,000,000		1,042,990
			4,761,580
Rhode Island - 0.9%
Rhode Island Health & Edl. Bldg. Corp. Rev. Series A, 5.25% 9/15/17 (AMBAC Insured)	1,000,000		1,089,940
Rhode Island Port Auth. & Econ. Dev. Corp. Arpt. Rev. Series A, 7% 7/1/14 (FSA Insured) (d)	4,000,000		4,539,440
			5,629,380
South Carolina - 1.4%
Greenville County School District Installment Purp. Rev. 5% 12/1/12	3,750,000		3,998,363
Lexington One School Facilities Corp. Rev. (Lexington County School District No. 1 Proj.) 5% 12/1/17	1,015,000		1,091,501
South Carolina Jobs Econ. Dev. Auth. Hosp. Facilities Rev. (Palmetto Health Alliance Proj.) Series A, 7.375% 12/15/21 (Pre-Refunded to 12/15/10 @ 102) (e)	1,000,000		1,157,110
South Carolina Pub. Svc. Auth. Rev.:
(Santee Cooper Proj.) Series 2005 B, 5% 1/1/18 (MBIA Insured)	1,000,000		1,087,220
Series A, 5.5% 1/1/16 (FGIC Insured)	1,000,000		1,134,570
Tobacco Settlement Rev. Mgmt. Auth. Series 2001 B, 6.375% 5/15/28	545,000		587,690
			9,056,454
Tennessee - 0.9%
Clarksville Natural Gas Acquisition Corp. Gas Rev.:
5% 12/15/13	1,000,000		1,069,670
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Tennessee - continued
Clarksville Natural Gas Acquisition Corp. Gas Rev.: - continued
5% 12/15/15	$ 1,500,000		$ 1,620,720
5% 12/15/16	1,500,000		1,625,025
Shelby County Health Edl. & Hsg. Facility Board Hosp. Rev. (Methodist Hosp. Proj.) 6.5% 9/1/26 (Pre-Refunded to 9/1/12 @ 100) (e)	1,120,000		1,288,672
			5,604,087
Texas - 13.2%
Abilene Independent School District 5% 2/15/19	1,090,000		1,169,330
Aledo Independent School District Series A, 5.125% 2/15/33	1,000,000		1,060,490
Austin Cmnty. College District 5.5% 8/1/34	1,000,000		1,106,700
Austin Util. Sys. Rev. 0% 11/15/12 (AMBAC Insured)	1,300,000		1,035,879
Boerne Independent School District 5.25% 2/1/35	1,500,000		1,600,905
Canyon Independent School District Series A, 5.5% 2/15/18	1,575,000		1,735,335
Corpus Christi Util. Sys. Rev. 5.25% 7/15/18 (FSA Insured)	1,000,000		1,116,190
Corsicana Independent School District 5.125% 2/15/28	1,015,000		1,080,051
Cypress-Fairbanks Independent School District Series A:
0% 2/15/14	3,200,000		2,411,872
0% 2/15/16	1,400,000		966,644
Dallas Fort Worth Int'l. Arpt. Rev. Series A, 5.25% 11/1/12 (MBIA Insured) (d)	1,000,000		1,069,890
Denton Independent School District 5% 8/15/33 (b)	1,600,000		1,660,864
Fort Worth Wtr. & Swr. Rev. 5% 2/15/16 (FSA Insured)	1,000,000		1,075,670
Garland Independent School District 5.5% 2/15/19	2,500,000		2,641,750
Grand Prairie Independent School District 5.375% 2/15/16 (FSA Insured)	1,000,000		1,091,910
Guadalupe-Blanco River Auth. Contract Rev. (Western Canyon Reg'l. Wtr. Supply Proj.) 5.25% 4/15/20 (MBIA Insured)	1,000,000		1,076,900
Harris County Gen. Oblig.:
Series A, 5.25% 8/15/35 (FSA Insured)	1,600,000		1,687,296
0% 10/1/17 (MBIA Insured)	2,500,000		1,607,250
0% 8/15/24 (MBIA Insured)	1,000,000		461,980
Harris County Health Facilities Dev. Corp. Rev. (Saint Luke's Episcopal Hosp. Proj.):
Series 2001 A, 5.5% 2/15/12 (Pre-Refunded to 8/15/11 @ 100) (e)	1,000,000		1,082,290
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Texas - continued
Harris County Health Facilities Dev. Corp. Rev. (Saint Luke's Episcopal Hosp. Proj.): - continued
5.75% 2/15/21 (Pre-Refunded to 8/15/12 @ 100) (e)	$ 1,310,000		$ 1,452,908
Hays Consolidated Independent School District Series A, 5.125% 8/15/30	1,000,000		1,065,780
Houston Arpt. Sys. Rev.:
Series A, 5.625% 7/1/19 (FSA Insured) (d)	1,000,000		1,078,910
Series B, 5.5% 7/1/30 (FSA Insured)	1,400,000		1,483,006
Houston Independent School District 0% 8/15/13	1,300,000		1,000,363
Humble Independent School District:
Series 2005 B, 5.25% 2/15/20 (FGIC Insured)	1,800,000		1,970,496
0% 2/15/17	1,000,000		661,450
Hurst Euless Bedford Independent School District 0% 8/15/11	1,000,000		834,830
Lewisville Independent School District 0% 8/15/19	2,340,000		1,373,767
Lower Colorado River Auth. Transmission Contract Rev. (LCRA Transmission Services Corp. Proj.) Series C, 5.25% 5/15/19 (AMBAC Insured)	1,000,000		1,081,930
Mansfield Independent School District:
5.375% 2/15/26	1,000,000		1,068,650
5.5% 2/15/17	2,000,000		2,175,720
Mesquite Independent School District 3.65%, tender 12/1/08 (Liquidity Facility JPMorgan Chase Bank) (c)	1,000,000		1,000,000
Montgomery County Muni. Util. District #46 5% 3/1/21 (FSA Insured)	1,040,000		1,083,836
North Central Health Facilities Dev. Corp. Rev. (Children's Med. Ctr. of Dallas Proj.) 5.5% 8/15/16 (AMBAC Insured)	1,230,000		1,340,774
Northside Independent School District 5.5% 2/15/15	940,000		1,008,329
Northwest Texas Independent School District 5.5% 8/15/21	3,185,000		3,503,373
Sabine River Auth. Poll. Cont. Rev. (Texas Utils. Elec. Co. Proj.) Series B, 5.75%, tender 11/1/11 (c)(d)	4,645,000		4,931,086
San Antonio Elec. & Gas Sys. Rev. 5.5% 2/1/20 (Pre-Refunded to 2/1/07 @ 101) (e)	75,000		76,093
San Marcos Consolidated Independent School District:
5% 8/1/20	1,525,000		1,625,604
5.125% 8/1/29 (Pre-Refunded to 8/1/14 @ 100) (e)	1,900,000		2,084,794
Southwest Higher Ed. Auth. Rev. (Southern Methodist Univ. Proj.) 5.5% 10/1/14 (AMBAC Insured)	2,245,000		2,458,657
Spring Branch Independent School District 5.375% 2/1/18	1,000,000		1,066,390
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Texas - continued
Tarrant County Health Facilities Dev. Corp. Hosp. Rev. 5.375% 11/15/20 (Pre-Refunded to 11/15/08 @ 101) (e)	$ 1,000,000		$ 1,044,190
Texas Muni. Pwr. Agcy. Rev.:
0% 9/1/11 (AMBAC Insured)	4,715,000		3,946,408
0% 9/1/11 (Escrowed to Maturity) (e)	35,000		29,239
0% 9/1/15 (MBIA Insured)	1,100,000		778,140
Texas Pub. Fin. Auth. Bldg. Rev. (Texas Technical College Proj.) 6.25% 8/1/09 (MBIA Insured)	640,000		665,248
Texas Tpk. Auth. Central Tpk. Sys. Rev.:
5.5% 8/15/39 (AMBAC Insured)	4,050,000		4,371,489
5.75% 8/15/38 (AMBAC Insured)	3,775,000		4,135,248
Texas Wtr. Dev. Board Rev. Series A, 5.5% 7/15/21	1,000,000		1,046,580
Travis County Health Facilities Dev. Corp. Rev. (Ascension Health Cr. Prog.) Series A, 6.25% 11/15/19 (Pre-Refunded to 11/15/09 @ 101) (e)	4,000,000		4,337,880
Tyler Health Facilities Dev. Corp. Hosp. Rev. (Mother Frances Hosp. Reg'l. Health Care Ctr. Proj.) 6% 7/1/27	1,000,000		1,080,900
White Settlement Independent School District 5.75% 8/15/34	1,440,000		1,581,336
Williamson County Gen. Oblig. 5.5% 2/15/19 (FSA Insured)	35,000		37,501
			85,220,101
Utah - 0.3%
Intermountain Pwr. Agcy. Pwr. Supply Rev.:
Series A:
6.5% 7/1/09 (AMBAC Insured)	365,000		391,324
6.5% 7/1/09 (Escrowed to Maturity) (e)	635,000		682,631
Series B, 5.75% 7/1/16 (MBIA Insured)	1,025,000		1,059,163
			2,133,118
Vermont - 0.4%
Vermont Edl. & Health Bldg. Fing. Agcy. Rev.:
(Fletcher Allen Health Care, Inc. Proj.):
Series 2000 A, 6.125% 12/1/27 (AMBAC Insured)	1,000,000		1,092,040
Series A, 5.75% 12/1/18 (AMBAC Insured)	400,000		432,152
(Middlebury College Proj. Series A, 5% 10/31/46	1,000,000		1,053,060
			2,577,252
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Washington - 7.1%
Chelan County Pub. Util. District #1 Columbia River-Rock Island Hydro-Elec. Sys. Rev. Series A:
0% 6/1/17 (MBIA Insured)	$ 1,000,000		$ 641,590
0% 6/1/29 (MBIA Insured)	2,000,000		727,440
Clark County School District #114, Evergreen 5.375% 12/1/14 (FSA Insured)	3,040,000		3,308,797
Energy Northwest Elec. Rev. (#1 Proj.) Series 2006 A, 5% 7/1/15	1,000,000		1,087,810
Grant County Pub. Util. District #2 (Priest Rapids Hydro-Elec. Proj.) Second Series B, 5.375% 1/1/16 (MBIA Insured) (d)	1,715,000		1,809,874
Grant County Pub. Util. District #2 Wanapum Hydro Elec. Rev. Series B, 5.25% 1/1/22 (FGIC Insured) (d)	1,950,000		2,067,995
King County Swr. Rev. Series B, 5.125% 1/1/33 (FSA Insured)	2,800,000		2,936,612
Port of Seattle Passenger Facilities Charge Rev. Series B, 5.25% 12/1/14 (AMBAC Insured) (d)	3,000,000		3,114,990
Spokane County School District #81 5.25% 12/1/18 (FSA Insured)	1,000,000		1,082,450
Spokane Gen. Oblig. 5.25% 12/1/24 (AMBAC Insured)	1,000,000		1,080,510
Spokane Pub. Facilities District Hotel/Motel Tax & Sales/Use Tax Rev. 5.75% 12/1/24 (MBIA Insured)	1,000,000		1,112,830
Tumwater School District #33, Thurston County Series 1996 B, 0% 12/1/10 (FGIC Insured)	4,000,000		3,433,560
Washington Gen. Oblig.:
Series 2001 C, 5.25% 1/1/16	1,000,000		1,065,180
Series C, 5.25% 1/1/26 (FSA Insured)	1,000,000		1,061,600
Series R 97A, 0% 7/1/19 (MBIA Insured)	1,200,000		701,100
Washington Health Care Facilities Auth. Rev. (Providence Health Systems Proj.) Series 2001 A, 5.5% 10/1/13 (MBIA Insured)	3,000,000		3,238,980
Washington Pub. Pwr. Supply Sys. Nuclear Proj. #2 Rev. 5.4% 7/1/12	16,000,000		17,385,430
			45,856,748
Wisconsin - 1.3%
Badger Tobacco Asset Securitization Corp. 6.125% 6/1/27	845,000		907,099
Douglas County Gen. Oblig. 5.5% 2/1/18 (FGIC Insured)	335,000		362,236
Menasha Joint School District:
5.5% 3/1/17 (FSA Insured)	65,000		70,216
5.5% 3/1/17 (Pre-Refunded to 3/1/12 @ 100) (e)	1,095,000		1,187,538
Municipal Bonds - continued
	Principal Amount		Value (Note 1)
Wisconsin - continued
Wisconsin Health & Edl. Facilities Auth. Rev.:
(Marshfield Clinic Proj.) Series B, 6% 2/15/25	$ 1,500,000		$ 1,616,325
(Wheaton Franciscan Svcs., Inc. Proj.):
Series A, 5.5% 8/15/16	1,000,000		1,075,980
5.75% 8/15/30	1,500,000		1,619,595
6.25% 8/15/22	600,000		669,120
Series A, 5.375% 2/15/34	1,000,000		1,060,280
			8,568,389
TOTAL INVESTMENT PORTFOLIO - 99.3% (Cost $614,228,591)			638,994,162
NET OTHER ASSETS - 0.7%			4,807,732
NET ASSETS - 100%		$ 643,801,894

Legend

(a) Security initially issued at one coupon which converts to a higher coupon at a specified date. The rate shown is the rate at period end.

(b) Security or a portion of the security purchased on a delayed delivery or when-issued basis.

(d) Private activity obligations whose interest is subject to the federal alternative minimum tax for individuals.

(e) Security collateralized by an amount sufficient to pay interest and principal.

Other Information

The distribution of municipal securities by revenue source, as a percentage of total net assets, is as follows:

General Obligations	37.8%
Health Care	11.0%
Electric Utilities	9.2%
Transportation	8.9%
Escrowed/Pre-Refunded	7.7%
Water & Sewer	7.4%
Special Tax	6.5%
Education	5.8%
Others* (individually less than 5%)	5.7%
	100.0%

*Includes net other assets

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Statements

Statement of Assets and Liabilities

	October 31, 2006

Assets
Investment in securities, at value - See accompanying schedule: Unaffiliated issuers (cost $614,228,591)		$ 638,994,162
Cash		5,632,835
Receivable for investments sold		682,593
Receivable for fund shares sold		911,300
Interest receivable		9,437,418
Other receivables		21,626
Total assets		655,679,934

Liabilities
Payable for investments purchased Regular delivery	$ 856,460
Delayed delivery	9,092,667
Payable for fund shares redeemed	713,398
Distributions payable	724,222
Accrued management fee	196,680
Distribution fees payable	182,418
Other affiliated payables	72,676
Other payables and accrued expenses	39,519
Total liabilities		11,878,040

Net Assets		$ 643,801,894
Net Assets consist of:
Paid in capital		$ 613,879,528
Distributions in excess of net investment income		(193,440)
Accumulated undistributed net realized gain (loss) on investments		5,350,235
Net unrealized appreciation (depreciation) on investments		24,765,571
Net Assets		$ 643,801,894

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Statements - continued

Statement of Assets and Liabilities - continued

	October 31, 2006

Calculation of Maximum Offering Price Class A: Net Asset Value and redemption price per share ($144,183,000 ÷ 11,094,124 shares)		$ 13.00

Maximum offering price per share (100/95.25 of $13.00)		$ 13.65
Class T: Net Asset Value and redemption price per share ($310,132,270 ÷ 23,810,705 shares)		$ 13.02

Maximum offering price per share (100/96.50 of $13.02)		$ 13.49
Class B: Net Asset Value and offering price per share ($65,114,188 ÷ 5,021,595 shares)^A		$ 12.97

Class C: Net Asset Value and offering price per share ($62,799,018 ÷ 4,823,765 shares)^A		$ 13.02

Institutional Class: Net Asset Value, offering price and redemption price per share ($61,573,418 ÷ 4,755,362 shares)		$ 12.95

^ARedemption price per share is equal to net asset value less any applicable contingent deferred sales charge.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Statement of Operations

	Year ended October 31, 2006

Investment Income
Interest		$ 30,774,702

Expenses
Management fee	$ 2,501,104
Transfer agent fees	739,624
Distribution fees	2,277,935
Accounting fees and expenses	166,353
Custodian fees and expenses	11,523
Independent trustees' compensation	2,693
Registration fees	91,608
Audit	51,335
Legal	8,416
Miscellaneous	3,676
Total expenses before reductions	5,854,267
Expense reductions	(332,117)	5,522,150
Net investment income		25,252,552
Realized and Unrealized Gain (Loss) Net realized gain (loss) on:
Investment securities:
Unaffiliated issuers	5,559,165
Futures contracts	116,664
Total net realized gain (loss)		5,675,829
Change in net unrealized appreciation (depreciation) on investment securities		4,279,338
Net gain (loss)		9,955,167
Net increase (decrease) in net assets resulting from operations		$ 35,207,719

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Statements - continued

Statement of Changes in Net Assets

	Year ended October 31, 2006	Year ended October 31, 2005
Increase (Decrease) in Net Assets
Operations
Net investment income	$ 25,252,552	$ 23,857,985
Net realized gain (loss)	5,675,829	8,968,764
Change in net unrealized appreciation (depreciation)	4,279,338	(19,180,759)
Net increase (decrease) in net assets resulting from operations	35,207,719	13,645,990
Distributions to shareholders from net investment income	(25,274,196)	(23,793,542)
Distributions to shareholders from net realized gain	(8,244,683)	(5,181,802)
Total distributions	(33,518,879)	(28,975,344)
Share transactions - net increase (decrease)	(16,629,046)	51,939,913
Total increase (decrease) in net assets	(14,940,206)	36,610,559

Net Assets
Beginning of period	658,742,100	622,131,541
End of period (including distributions in excess of net investment income of $193,440 and distributions in excess of net investment income of $158,981, respectively)	$ 643,801,894	$ 658,742,100

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Class A

Years ended October 31,	2006	2005	2004	2003	2002
Selected Per-Share Data
Net asset value, beginning of period	$ 12.97	$ 13.28	$ 13.00	$ 12.87	$ 12.70
Income from Investment Operations
Net investment income ^C	.504	.521	.533	.539	.557
Net realized and unrealized gain (loss)	.193	(.201)	.301	.137	.168
Total from investment operations	.697	.320	.834	.676	.725
Distributions from net investment income	(.505)	(.520)	(.532)	(.544)	(.555)
Distributions from net realized gain	(.162)	(.110)	(.022)	(.002)	-
Total distributions	(.667)	(.630)	(.554)	(.546)	(.555)
Net asset value, end of period	$ 13.00	$ 12.97	$ 13.28	$ 13.00	$ 12.87
Total Return ^A,B	5.56%	2.46%	6.56%	5.33%	5.88%
Ratios to Average Net Assets ^D
Expenses before reductions	.68%	.69%	.69%	.68%	.69%
Expenses net of fee waivers, if any	.68%	.69%	.69%	.68%	.69%
Expenses net of all reductions	.63%	.67%	.69%	.68%	.67%
Net investment income	3.93%	3.96%	4.07%	4.15%	4.41%
Supplemental Data
Net assets, end of period (000 omitted)	$ 144,183	$ 123,844	$ 101,763	$ 87,406	$ 67,457
Portfolio turnover rate	26%	22%	17%	26%	20%

^A Total returns would have been lower had certain expenses not been reduced during the periods shown.

^B Total returns do not include the effect of the sales charges.

^C Calculated based on average shares outstanding during the period.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Class T

Years ended October 31,	2006	2005	2004	2003	2002
Selected Per-Share Data
Net asset value, beginning of period	$ 13.00	$ 13.31	$ 13.03	$ 12.89	$ 12.72
Income from Investment Operations
Net investment income ^C	.493	.509	.522	.529	.546
Net realized and unrealized gain (loss)	.181	(.202)	.299	.144	.166
Total from investment operations	.674	.307	.821	.673	.712
Distributions from net investment income	(.492)	(.507)	(.519)	(.531)	(.542)
Distributions from net realized gain	(.162)	(.110)	(.022)	(.002)	-
Total distributions	(.654)	(.617)	(.541)	(.533)	(.542)
Net asset value, end of period	$ 13.02	$ 13.00	$ 13.31	$ 13.03	$ 12.89
Total Return ^A,B	5.36%	2.35%	6.44%	5.30%	5.76%
Ratios to Average Net Assets ^D
Expenses before reductions	.78%	.79%	.79%	.78%	.79%
Expenses net of fee waivers, if any	.78%	.79%	.79%	.78%	.79%
Expenses net of all reductions	.73%	.77%	.78%	.77%	.77%
Net investment income	3.83%	3.86%	3.97%	4.06%	4.31%
Supplemental Data
Net assets, end of period (000 omitted)	$ 310,132	$ 318,973	$ 319,734	$ 340,542	$ 354,030
Portfolio turnover rate	26%	22%	17%	26%	20%

^A Total returns would have been lower had certain expenses not been reduced during the periods shown.

^B Total returns do not include the effect of the sales charges.

^C Calculated based on average shares outstanding during the period.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Class B

Years ended October 31,	2006	2005	2004	2003	2002
Selected Per-Share Data
Net asset value, beginning of period	$ 12.94	$ 13.25	$ 12.98	$ 12.85	$ 12.67
Income from Investment Operations
Net investment income ^C	.407	.421	.435	.443	.462
Net realized and unrealized gain (loss)	.193	(.200)	.291	.136	.178
Total from investment operations	.600	.221	.726	.579	.640
Distributions from net investment income	(.408)	(.421)	(.434)	(.447)	(.460)
Distributions from net realized gain	(.162)	(.110)	(.022)	(.002)	-
Total distributions	(.570)	(.531)	(.456)	(.449)	(.460)
Net asset value, end of period	$ 12.97	$ 12.94	$ 13.25	$ 12.98	$ 12.85
Total Return ^A,B	4.78%	1.70%	5.70%	4.56%	5.19%
Ratios to Average Net Assets ^D
Expenses before reductions	1.44%	1.45%	1.44%	1.43%	1.44%
Expenses net of fee waivers, if any	1.44%	1.45%	1.44%	1.43%	1.44%
Expenses net of all reductions	1.39%	1.42%	1.44%	1.42%	1.41%
Net investment income	3.17%	3.21%	3.32%	3.41%	3.66%
Supplemental Data
Net assets, end of period (000 omitted)	$ 65,114	$ 82,084	$ 97,487	$ 110,853	$ 109,986
Portfolio turnover rate	26%	22%	17%	26%	20%

^A Total returns would have been lower had certain expenses not been reduced during the periods shown.

^B Total returns do not include the effect of the contingent deferred sales charge.

^C Calculated based on average shares outstanding during the period.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Class C

Years ended October 31,	2006	2005	2004	2003	2002
Selected Per-Share Data
Net asset value, beginning of period	$ 12.99	$ 13.30	$ 13.02	$ 12.89	$ 12.71
Income from Investment Operations
Net investment income ^C	.396	.410	.423	.430	.451
Net realized and unrealized gain (loss)	.192	(.202)	.300	.135	.176
Total from investment operations	.588	.208	.723	.565	.627
Distributions from net investment income	(.396)	(.408)	(.421)	(.433)	(.447)
Distributions from net realized gain	(.162)	(.110)	(.022)	(.002)	-
Total distributions	(.558)	(.518)	(.443)	(.435)	(.447)
Net asset value, end of period	$ 13.02	$ 12.99	$ 13.30	$ 13.02	$ 12.89
Total Return ^A,B	4.66%	1.59%	5.65%	4.44%	5.06%
Ratios to Average Net Assets ^D
Expenses before reductions	1.53%	1.54%	1.54%	1.53%	1.53%
Expenses net of fee waivers, if any	1.53%	1.54%	1.54%	1.53%	1.53%
Expenses net of all reductions	1.48%	1.52%	1.54%	1.52%	1.51%
Net investment income	3.08%	3.11%	3.22%	3.31%	3.57%
Supplemental Data
Net assets, end of period (000 omitted)	$ 62,799	$ 63,984	$ 58,984	$ 59,423	$ 52,019
Portfolio turnover rate	26%	22%	17%	26%	20%

^A Total returns would have been lower had certain expenses not been reduced during the periods shown.

^B Total returns do not include the effect of the contingent deferred sales charge.

^C Calculated based on average shares outstanding during the period.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Institutional Class

Years ended October 31,	2006	2005	2004	2003	2002
Selected Per-Share Data
Net asset value, beginning of period	$ 12.92	$ 13.24	$ 12.96	$ 12.83	$ 12.66
Income from Investment Operations
Net investment income ^B	.520	.540	.551	.556	.573
Net realized and unrealized gain (loss)	.196	(.208)	.304	.139	.170
Total from investment operations	.716	.332	.855	.695	.743
Distributions from net investment income	(.524)	(.542)	(.553)	(.563)	(.573)
Distributions from net realized gain	(.162)	(.110)	(.022)	(.002)	-
Total distributions	(.686)	(.652)	(.575)	(.565)	(.573)
Net asset value, end of period	$ 12.95	$ 12.92	$ 13.24	$ 12.96	$ 12.83
Total Return ^A	5.73%	2.56%	6.75%	5.50%	6.05%
Ratios to Average Net Assets ^C
Expenses before reductions	.54%	.53%	.54%	.54%	.55%
Expenses net of fee waivers, if any	.54%	.53%	.54%	.54%	.55%
Expenses net of all reductions	.49%	.51%	.53%	.53%	.52%
Net investment income	4.07%	4.13%	4.23%	4.30%	4.55%
Supplemental Data
Net assets, end of period (000 omitted)	$ 61,573	$ 69,857	$ 44,164	$ 44,960	$ 31,703
Portfolio turnover rate	26%	22%	17%	26%	20%

^A Total returns would have been lower had certain expenses not been reduced during the periods shown.

^B Calculated based on average shares outstanding during the period.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Notes to Financial Statements

For the period ended October 31, 2006

1. Significant Accounting Policies.

Annual Report

Notes to Financial Statements - continued

1. Significant Accounting Policies - continued

Investment Transactions and Income. Security transactions are accounted for as of trade date. Gains and losses on securities sold are determined on the basis of identified cost. Interest income is accrued as earned. Interest income includes coupon interest and amortization of premium and accretion of discount on debt securities.

Book-tax differences are primarily due to futures transactions, market discount, deferred trustees compensation and losses deferred due to wash sales and futures transactions.

Annual Report

1. Significant Accounting Policies - continued

Income Tax Information and Distributions to Shareholders - continued

The tax-basis components of distributable earnings and the federal tax cost as of period end were as follows:

Unrealized appreciation	$ 24,524,584
Unrealized depreciation	(175,056)
Net unrealized appreciation (depreciation)	24,349,528
Undistributed ordinary income	3,349
Undistributed long-term capital gain	4,625,537

Cost for federal income tax purposes	$ 614,644,634

The tax character of distributions paid was as follows:

	October 31, 2006	October 31, 2005
Tax-exempt Income	$ 25,274,196	$ 23,793,542
Ordinary Income	458,038	-
Long-term Capital Gains	7,786,645	5,181,802
Total	$ 33,518,879	$ 28,975,344

2. Operating Policies.

Annual Report

Notes to Financial Statements - continued

2. Operating Policies - continued

Delayed Delivery Transactions and When-Issued Securities - continued

3. Purchases and Sales of Investments.

Purchases and sales of securities, other than short-term securities, aggregated $175,455,215 and $194,493,624, respectively.

4. Fees and Other Transactions with Affiliates.

Annual Report

4. Fees and Other Transactions with Affiliates - continued

Management Fee - continued

	Distribution Fee	Service Fee	Paid to FDC	Retained by FDC
Class A	0%	.15%	$ 209,032	$ 3,340
Class T	0%	.25%	787,222	4,485
Class B	.65%	.25%	652,930	472,871
Class C	.75%	.25%	628,751	120,992
			$ 2,277,935	$ 601,688

For the period, sales charge amounts retained by FDC were as follows:

	Retained by FDC
Class A	$ 76,106
Class T	35,294
Class B*	203,620
Class C*	15,019
	$ 330,039

* When Class B and Class C shares are initially sold, FDC pays commissions from its own resources to financial intermediaries through which the sales are made.

Annual Report

Notes to Financial Statements - continued

4. Fees and Other Transactions with Affiliates - continued

	Amount	% of Average Net Assets
Class A	$ 148,834	.11
Class T	340,485	.11
Class B	84,206	.12
Class C	67,732	.11
Institutional Class	98,367	.12
	$ 739,624

5. Committed Line of Credit.

Annual Report

6. Expense Reductions.

	Transfer Agent expense reduction
Class A	$ 32,477
Class T	74,770
Class B	16,847
Class C	14,563
Institutional Class	19,773
	$ 158,430

7. Other.

Annual Report

Notes to Financial Statements - continued

8. Distributions to Shareholders.

Distributions to shareholders of each class were as follows:

	Years ended October 31,
	2006	2005
From net investment income
Class A	$ 5,475,285	$ 4,352,247
Class T	12,053,776	12,293,343
Class B	2,316,388	2,889,040
Class C	1,936,779	1,912,870
Institutional Class	3,491,968	2,346,042
Total	$ 25,274,196	$ 23,793,542
From net realized gain
Class A	$ 1,555,692	$ 849,843
Class T	3,978,415	2,646,649
Class B	1,007,878	802,913
Class C	788,459	495,651
Institutional Class	914,239	386,746
Total	$ 8,244,683	$ 5,181,802

9. Share Transactions.

Transactions for each class of shares were as follows:

	Shares Years ended October 31,		Dollars Years ended October 31,
	2006	2005	2006	2005
Class A
Shares sold	4,948,217	3,538,994	$ 63,420,086	$ 46,541,886
Reinvestment of distributions	371,154	260,181	4,767,130	3,414,353
Shares redeemed	(3,774,302)	(1,912,570)	(48,584,463)	(25,132,123)
Net increase (decrease)	1,545,069	1,886,605	$ 19,602,753	$ 24,824,116
Class T
Shares sold	3,432,677	3,536,120	$ 44,171,647	$ 46,651,169
Reinvestment of distributions	936,819	836,332	12,055,637	10,998,832
Shares redeemed	(5,102,497)	(3,856,498)	(65,624,444)	(50,817,550)
Net increase (decrease)	(733,001)	515,954	$ (9,397,160)	$ 6,832,451
Class B
Shares sold	401,486	461,635	$ 5,146,784	$ 6,060,771
Reinvestment of distributions	154,058	167,091	1,974,082	2,187,643
Shares redeemed	(1,876,847)	(1,641,543)	(24,024,161)	(21,554,810)
Net increase (decrease)	(1,321,303)	(1,012,817)	$ (16,903,295)	$ (13,306,396)

Annual Report

9. Share Transactions - continued

	Shares Years ended October 31,		Dollars Years ended October 31,
	2006	2005	2006	2005
Class C
Shares sold	1,151,475	1,328,623	$ 14,821,030	$ 17,510,616
Reinvestment of distributions	139,244	114,142	1,791,102	1,500,047
Shares redeemed	(1,392,566)	(951,725)	(17,907,457)	(12,532,673)
Net increase (decrease)	(101,847)	491,040	$ (1,295,325)	$ 6,477,990
Institutional Class
Shares sold	5,188,827	2,803,468	$ 66,328,861	$ 36,736,293
Reinvestment of distributions	115,403	26,000	1,473,273	340,092
Shares redeemed	(5,953,881)	(760,791)	(76,438,153)	(9,964,633)
Net increase (decrease)	(649,651)	2,068,677	$ (8,636,019)	$ 27,111,752

Annual Report

Report of Independent Registered Public Accounting Firm

To the Trustees of Fidelity Advisor Series II and the Shareholders of Fidelity Advisor Municipal Income Fund:

PricewaterhouseCoopers LLP

Boston, Massachusetts

December 15, 2006

Annual Report

Trustees and Officers

The fund's statement of additional information (SAI) includes more information about the Trustees. To request a free copy, call Fidelity at 1-877-208-0098

Interested Trustees*:

Correspondence intended for each Trustee who is an interested person may be sent to Fidelity Investments, 82 Devonshire Street, Boston, Massachusetts 02109.

Name, Age; Principal Occupation
Edward C. Johnson 3d (76)
	Year of Election or Appointment: 1986 Mr. Johnson is Chairman of the Board of Trustees. Mr. Johnson serves as President (2006-present), Chief Executive Officer, Chairman, and a Director of FMR Corp.; Chairman and a Director of FMR; Chairman and a Director of Fidelity Research & Analysis Company (FRAC); Chairman and a Director of Fidelity Investments Money Management, Inc.; and Chairman (2001-present) and a Director of FMR Co., Inc. In addition, Mr. Johnson serves as Chairman and Director of Fidelity International Limited (FIL).
Stephen P. Jonas (53)
	Year of Election or Appointment: 2005 Mr. Jonas is Senior Vice President of Advisor Municipal Income (2005-present). He also serves as Senior Vice President of other Fidelity funds (2005-present). Mr. Jonas is Executive Director of FMR (2005-present) and FMR Co., Inc. (2005-present). He also serves as a Director of Fidelity Investments Money Management, Inc. (2005-present) and FMR Corp. (2003-present). Previously, Mr. Jonas served as President of Fidelity Enterprise Operations and Risk Services (2004-2005), Chief Administrative Officer (2002-2004), and Chief Financial Officer of FMR Corp. (1998-2002). In addition, he serves on the Boards of Boston Ballet (2003-present) and Simmons College (2003-present).
Robert L. Reynolds (54)
	Year of Election or Appointment: 2003 Mr. Reynolds is President and a Director of FMR (2005-present), Fidelity Investments Money Management, Inc. (2005-present), and FMR Co., Inc. (2005-present). Mr. Reynolds also serves as Vice Chairman (2006-present), a Director (2003-present), and Chief Operating Officer of FMR Corp. and a Director of Strategic Advisers, Inc. (2005-present). He also serves on the Board at Fidelity Investments Canada, Ltd.

* Trustees have been determined to be "Interested Trustees" by virtue of, among other things, their affiliation with the trust or various entities under common control with FMR.

Annual Report

Independent Trustees:

Correspondence intended for each Independent Trustee (that is, the Trustees other than the Interested Trustees) may be sent to Fidelity Investments, P.O. Box 55235, Boston, Massachusetts 02205-5235.

Name, Age; Principal Occupation
Dennis J. Dirks (58)
	Year of Election or Appointment: 2005 Prior to his retirement in May 2003, Mr. Dirks was Chief Operating Officer and a member of the Board of The Depository Trust & Clearing Corporation (DTCC) (1999-2003). He also served as President, Chief Operating Officer, and Board member of The Depository Trust Company (DTC) (1999-2003) and President and Board member of the National Securities Clearing Corporation (NSCC) (1999-2003). In addition, Mr. Dirks served as Chief Executive Officer and Board member of the Government Securities Clearing Corporation (2001-2003) and Chief Executive Officer and Board member of the Mortgage-Backed Securities Clearing Corporation (2001-2003). Mr. Dirks also serves as a Trustee and a member of the Finance Committee of Manhattan College (2005-present) and a Trustee and a member of the Finance Committee of AHRC of Nassau County (2006-present).
Albert R. Gamper, Jr. (64)
	Year of Election or Appointment: 2006 Prior to his retirement in December 2004, Mr. Gamper served as Chairman of the Board of CIT Group Inc. (commercial finance). During his tenure with CIT Group Inc. Mr. Gamper served in numerous senior management positions, including Chairman (1987-1989; 1999-2001; 2002-2004), Chief Executive Officer (1987-2004), and President (1989-2002). He currently serves as a member of the Board of Directors of Public Service Enterprise Group (utilities, 2001-present), Chairman of the Board of Governors, Rutgers University (2004-present), and Chairman of the Board of Saint Barnabas Health Care System.
George H. Heilmeier (70)
	Year of Election or Appointment: 2004 Dr. Heilmeier is Chairman Emeritus of Telcordia Technologies (communication software and systems), where prior to his retirement, he served as company Chairman and Chief Executive Officer. He currently serves on the Boards of Directors of The Mitre Corporation (systems engineering and information technology support for the government), and HRL Laboratories (private research and development, 2004-present). He is Chairman of the General Motors Science & Technology Advisory Board and a Life Fellow of the Institute of Electrical and Electronics Engineers (IEEE). Dr. Heilmeier is a member of the Defense Science Board and the National Security Agency Advisory Board. He is also a member of the National Academy of Engineering, the American Academy of Arts and Sciences, and the Board of Overseers of the School of Engineering and Applied Science of the University of Pennsylvania. Previously, Dr. Heilmeier served as a Director of TRW Inc. (automotive, space, defense, and information technology, 1992-2002), Compaq (1994-2002), Automatic Data Processing, Inc. (ADP) (technology-based business outsourcing, 1995-2002), INET Technologies Inc. (telecommunications network surveillance, 2001-2004), and Teletech Holdings (customer management services). He is the recipient of the 2005 Kyoto Prize in Advanced Technology for his invention of the liquid crystal display, and a member of the Consumer Electronics Hall of Fame.
Marie L. Knowles (60)
	Year of Election or Appointment: 2001 Prior to Ms. Knowles' retirement in June 2000, she served as Executive Vice President and Chief Financial Officer of Atlantic Richfield Company (ARCO) (diversified energy, 1996-2000). From 1993 to 1996, she was a Senior Vice President of ARCO and President of ARCO Transportation Company. She served as a Director of ARCO from 1996 to 1998. She currently serves as a Director of Phelps Dodge Corporation (copper mining and manufacturing) and McKesson Corporation (healthcare service, 2002-present). Ms. Knowles is a Trustee of the Brookings Institution and the Catalina Island Conservancy and also serves as a member of the Advisory Board for the School of Engineering of the University of Southern California.
Ned C. Lautenbach (62)
	Year of Election or Appointment: 2000 Mr. Lautenbach is Chairman of the Independent Trustees (2006-present). Mr. Lautenbach has been a partner of Clayton, Dubilier & Rice, Inc. (private equity investment firm) since September 1998. Previously, Mr. Lautenbach was with the International Business Machines Corporation (IBM) from 1968 until his retirement in 1998. Mr. Lautenbach serves as a Director of Sony Corporation (2006-present) and Eaton Corporation (diversified industrial) as well as the Philharmonic Center for the Arts in Naples, Florida. He also is a member of the Board of Trustees of Fairfield University (2005-present), as well as a member of the Council on Foreign Relations.
William O. McCoy (73)
	Year of Election or Appointment: 1997 Prior to his retirement in December 1994, Mr. McCoy was Vice Chairman of the Board of BellSouth Corporation (telecommunications) and President of BellSouth Enterprises. He is currently a Director of Duke Realty Corporation (real estate). He is also a partner of Franklin Street Partners (private investment management firm). In addition, Mr. McCoy served as the Interim Chancellor (1999-2000) and a member of the Board of Visitors for the University of North Carolina at Chapel Hill and currently serves as Chairman of the Board of Directors of the University of North Carolina Health Care System. He also served as Vice President of Finance for the University of North Carolina (16-school system).
Cornelia M. Small (62)
	Year of Election or Appointment: 2005 Ms. Small is a member (2000-present) and Chairperson (2002-present) of the Investment Committee, and a member (2002-present) of the Board of Trustees of Smith College. Previously, she served as Chief Investment Officer (1999-2000), Director of Global Equity Investments (1996-1999), and a member of the Board of Directors of Scudder, Stevens & Clark (1990-1997) and Scudder Kemper Investments (1997-1999). In addition, Ms. Small served as Co-Chair (2000-2003) of the Annual Fund for the Fletcher School of Law and Diplomacy.
William S. Stavropoulos (67)
	Year of Election or Appointment: 2001 Mr. Stavropoulos is Chairman Emeritus of the Board of Directors of The Dow Chemical Company. Since joining The Dow Chemical Company in 1967, Mr. Stavropoulos served in numerous senior management positions, including President (1993-2000; 2002-2003), CEO (1995-2000; 2002-2004), and Chairman of the Executive Committee (2000-2004). Currently, he is a Director of NCR Corporation (data warehousing and technology solutions), BellSouth Corporation (telecommunications), Chemical Financial Corporation, Maersk Inc. (industrial conglomerate, 2002-present), and Metalmark Capital (private equity investment firm, 2005-present). He also serves as a member of the Board of Trustees of the American Enterprise Institute for Public Policy Research. In addition, Mr. Stavropoulos is a member of The Business Council, J.P. Morgan International Council and the University of Notre Dame Advisory Council for the College of Science.
Kenneth L. Wolfe (67)
	Year of Election or Appointment: 2005 Prior to his retirement in 2001, Mr. Wolfe was Chairman and Chief Executive Officer of Hershey Foods Corporation (1993-2001). He currently serves as a member of the boards of Adelphia Communications Corporation (2003-present), Bausch & Lomb, Inc., and Revlon Inc. (2004-present).

Annual Report

Advisory Board Members and Executive Officers:

Name, Age; Principal Occupation
James H. Keyes (66)
	Year of Election or Appointment: 2006 Member of the Advisory Board of Fidelity Advisor Series II. Prior to his retirement in 2003, Mr. Keyes was Chairman, President, and Chief Executive Officer of Johnson Controls, Inc. (automotive supplier, 1993-2003). He currently serves as a member of the boards of LSI Logic Corporation (semiconductor technologies), Navistar International Corporation (manufacture and sale of trucks, buses, and diesel engines, 2002-present), and Pitney Bowes, Inc. (integrated mail, messaging, and document management solutions).
Peter S. Lynch (62)
	Year of Election or Appointment: 2003 Member of the Advisory Board of Fidelity Advisor Series II. Mr. Lynch is Vice Chairman and a Director of FMR, and Vice Chairman (2001- present) and a Director of FMR Co., Inc. Previously, Mr. Lynch served as a Trustee of the Fidelity funds (1990-2003). In addition, he serves as a Trustee of Boston College and as the Chairman of the Inner-City Scholarship Fund.
Boyce I. Greer (50)
	Year of Election or Appointment: 2006 Vice President of Advisor Municipal Income. Mr. Greer also serves as Vice President of certain Equity Funds (2005-present), certain Asset Allocation Funds (2005-present), Fixed-Income Funds (2006-present), and Money Market Funds (2006-present). Mr. Greer is also a Trustee of other investment companies advised by FMR (2003-present). He is an Executive Vice President of FMR (2005-present) and FMR Co., Inc. (2005-present), and Senior Vice President of Fidelity Investments Money Management, Inc. (2006-present). Previously, Mr. Greer served as a Director and Managing Director of Strategic Advisers, Inc. (2002-2005), and Executive Vice President (2000-2002) and Money Market Group Leader (1997-2002) of the Fidelity Investments Fixed Income Division. He also served as Vice President of Fidelity's Money Market Funds (1997-2002), Senior Vice President of FMR (1997-2002), and Vice President of FIMM (1998-2002).
David L. Murphy (58)
	Year of Election or Appointment: 2005 Vice President of Advisor Municipal Income. Mr. Murphy also serves as Vice President of Fidelity's Money Market Funds (2002-present), certain Asset Allocation Funds (2003-present), Fixed-Income Funds (2005-present), and Balanced Funds (2005-present). He serves as Senior Vice President (2000-present) and Head (2004-present) of the Fidelity Investments Fixed Income Division. Mr. Murphy is also a Senior Vice President of Fidelity Investments Money Management, Inc. (2003-present) and an Executive Vice President of FMR (2005-present). Previously, Mr. Murphy served as Money Market Group Leader (2002-2004), Bond Group Leader (2000-2002), and Vice President of Fidelity's Taxable Bond Funds (2000-2002) and Fidelity's Municipal Bond Funds (2001-2002).
Thomas J. Silvia (45)
	Year of Election or Appointment: 2005 Vice President of Advisor Municipal Income. Mr. Silvia also serves as Vice President of Fidelity's Fixed-Income Funds (2005-present), certain Balanced Funds (2005-present), certain Asset Allocation Funds (2005-present), and Senior Vice President and Bond Group Leader of the Fidelity Investments Fixed-Income Division (2005-present). Previously, Mr. Silvia served as Director of Fidelity's Taxable Bond portfolio managers (2002-2004) and a portfolio manager in the Bond Group (1997-2004).
Christine J. Thompson (48)
	Year of Election or Appointment: 1998 Vice President of Advisor Municipal Income. Ms. Thompson also serves as Vice President of other funds advised by FMR. Prior to assuming her current responsibilities, Ms. Thompson worked as an analyst and manager.
Eric D. Roiter (57)
	Year of Election or Appointment: 1998 Secretary of Advisor Municipal Income. He also serves as Secretary of other Fidelity funds; Vice President, General Counsel, and Secretary of FMR Co., Inc. (2001-present) and FMR; Assistant Secretary of Fidelity Management & Research (U.K.) Inc. (2001-present), Fidelity Research & Analysis Company (2001-present), and Fidelity Investments Money Management, Inc. (2001-present). Mr. Roiter is an Adjunct Member, Faculty of Law, at Boston College Law School (2003-present). Previously, Mr. Roiter served as Vice President and Secretary of Fidelity Distributors Corporation (FDC) (1998-2005).
Stuart Fross (47)
	Year of Election or Appointment: 2003 Assistant Secretary of Advisor Municipal Income. Mr. Fross also serves as Assistant Secretary of other Fidelity funds (2003-present), Vice President and Secretary of FDC (2005-present), and is an employee of FMR.
Christine Reynolds (48)
	Year of Election or Appointment: 2004 President and Treasurer of Advisor Municipal Income. Ms. Reynolds also serves as President and Treasurer of other Fidelity funds (2004-present) and is a Vice President (2003-present) and an employee (2002-present) of FMR. Before joining Fidelity Investments, Ms. Reynolds worked at PricewaterhouseCoopers LLP (PwC) (1980-2002), where she was most recently an audit partner with PwC's investment management practice.
R. Stephen Ganis (40)
	Year of Election or Appointment: 2006 Anti-Money Laundering (AML) officer of Advisor Municipal Income. Mr. Ganis also serves as AML officer of other Fidelity funds (2006-present) and FMR Corp. (2003-present). Before joining Fidelity Investments, Mr. Ganis practiced law at Goodwin Procter, LLP (2000-2002).
Joseph B. Hollis (58)
	Year of Election or Appointment: 2006 Chief Financial Officer of Advisor Municipal Income. Mr. Hollis also serves as Chief Financial Officer of other Fidelity funds. Mr. Hollis is President of Fidelity Pricing and Cash Management Services (FPCMS) (2005-present). Mr. Hollis also serves as President and Director of Fidelity Service Company, Inc. (2006-present). Previously, Mr. Hollis served as Senior Vice President of Cash Management Services (1999-2002) and Investment Management Operations (2002-2005).
Kenneth A. Rathgeber (59)
	Year of Election or Appointment: 2004 Chief Compliance Officer of Advisor Municipal Income. Mr. Rathgeber also serves as Chief Compliance Officer of other Fidelity funds (2004-present) and Executive Vice President of Risk Oversight for Fidelity Investments (2002-present). He is Chief Compliance Officer of FMR (2005-present), FMR Co., Inc. (2005-present), Fidelity Management & Research (U.K.) Inc. (2005-present), Fidelity Research & Analysis Company (2005-present), Fidelity Investments Money Management, Inc. (2005-present), and Strategic Advisers, Inc. (2005-present). Previously, Mr. Rathgeber served as Executive Vice President and Chief Operating Officer for Fidelity Investments Institutional Services Company, Inc. (1998-2002).
Bryan A. Mehrmann (45)
	Year of Election or Appointment: 2005 Deputy Treasurer of Advisor Municipal Income. Mr. Mehrmann also serves as Deputy Treasurer of other Fidelity funds (2005-present) and is an employee of FMR. Previously, Mr. Mehrmann served as Vice President of Fidelity Investments Institutional Services Group (FIIS)/Fidelity Investments Institutional Operations Corporation, Inc. (FIIOC) Client Services (1998-2004).
Kimberley H. Monasterio (42)
	Year of Election or Appointment: 2004 Deputy Treasurer of Advisor Municipal Income. Ms. Monasterio also serves as Deputy Treasurer of other Fidelity funds (2004) and is an employee of FMR (2004). Before joining Fidelity Investments, Ms. Monasterio served as Treasurer (2000-2004) and Chief Financial Officer (2002-2004) of the Franklin Templeton Funds and Senior Vice President of Franklin Templeton Services, LLC (2000-2004).
Kenneth B. Robins (37)
	Year of Election or Appointment: 2005 Deputy Treasurer of Advisor Municipal Income. Mr. Robins also serves as Deputy Treasurer of other Fidelity funds (2005-present) and is an employee of FMR (2004-present). Before joining Fidelity Investments, Mr. Robins worked at KPMG LLP, where he was a partner in KPMG's department of professional practice (2002-2004) and a Senior Manager (1999-2000). In addition, Mr. Robins served as Assistant Chief Accountant, United States Securities and Exchange Commission (2000-2002).
Robert G. Byrnes (39)
	Year of Election or Appointment: 2005 Assistant Treasurer of Advisor Municipal Income. Mr. Byrnes also serves as Assistant Treasurer of other Fidelity funds (2005-present) and is an employee of FMR (2005-present). Previously, Mr. Byrnes served as Vice President of FPCMS (2003-2005). Before joining Fidelity Investments, Mr. Byrnes worked at Deutsche Asset Management where he served as Vice President of the Investment Operations Group (2000-2003).
John H. Costello (60)
	Year of Election or Appointment: 1987 Assistant Treasurer of Advisor Municipal Income. Mr. Costello also serves as Assistant Treasurer of other Fidelity funds and is an employee of FMR.
Peter L. Lydecker (52)
	Year of Election or Appointment: 2004 Assistant Treasurer of Advisor Municipal Income. Mr. Lydecker also serves as Assistant Treasurer of other Fidelity funds (2004) and is an employee of FMR.
Mark Osterheld (51)
	Year of Election or Appointment: 2002 Assistant Treasurer of Advisor Municipal Income. Mr. Osterheld also serves as Assistant Treasurer of other Fidelity funds (2002) and is an employee of FMR.
Gary W. Ryan (48)
	Year of Election or Appointment: 2005 Assistant Treasurer of Advisor Municipal Income. Mr. Ryan also serves as Assistant Treasurer of other Fidelity funds (2005-present) and is an employee of FMR (2005-present). Previously, Mr. Ryan served as Vice President of Fund Reporting in FPCMS (1999-2005).
Salvatore Schiavone (40)
	Year of Election or Appointment: 2005 Assistant Treasurer of Advisor Municipal Income. Mr. Schiavone also serves as Assistant Treasurer of other Fidelity funds (2005-present) and is an employee of FMR (2005-present). Before joining Fidelity Investments, Mr. Schiavone worked at Deutsche Asset Management, where he most recently served as Assistant Treasurer (2003-2005) of the Scudder Funds and Vice President and Head of Fund Reporting (1996-2003).

Annual Report

Distributions

	Pay Date	Record Date	Capital Gains
Institutional Class	12/04/06	12/01/06	$0.095

During fiscal year ended 2006, 100% of the fund's income dividends was free from federal income tax, and 9.72% of the fund's income dividends was subject to the federal alternative minimum tax.

The fund will notify shareholders in January 2007 of amounts for use in preparing 2006 income tax returns.

Annual Report

Board Approval of Investment Advisory Contracts and Management Fees

Fidelity Advisor Municipal Income Fund

Annual Report

Board Approval of Investment Advisory Contracts and
Management Fees - continued

Annual Report

Board Approval of Investment Advisory Contracts and
Management Fees - continued

Fidelity Advisor Municipal Income Fund

The Board reviewed the fund's relative investment performance against its Lipper peer group and stated that the performance of Institutional Class of the fund was in the first quartile for all the periods shown. The Board also stated that the relative investment performance of Institutional Class of the fund compared favorably to its benchmark for all the periods shown. The Board considered that the variations in performance among the fund's classes reflect the variations in class expenses, which result in lower performance for higher expense classes.

Annual Report

Fidelity Advisor Municipal Income Fund

Annual Report

Board Approval of Investment Advisory Contracts and
Management Fees - continued

The Board noted that the total expenses of each class ranked below its competitive median for 2005.

Annual Report

The Board further concluded that any potential economies of scale are being shared between fund shareholders and Fidelity in an appropriate manner.

Annual Report

Investment Adviser

Fidelity Management & Research Company

Boston, MA

Investment Sub-Advisers

Fidelity Investments Money
Management, Inc.

Fidelity Research & Analysis Company
(formerly Fidelity Management &
Research (Far East) Inc.)

Fidelity International Investment Advisors

Fidelity International Investment Advisors
(U.K.) Limited

General Distributor

Fidelity Distributors Corporation

Boston, MA

Transfer and Service Agents

Citibank, N.A.
New York, NY

Fidelity Investments Institutional Operations Company, Inc.

Boston, MA

Fidelity Service Company, Inc.

Boston, MA

Custodian

Citibank, N.A.
New York, NY

HIMI-UANN-1206
1.784766.103

(Fidelity Investment logo)(registered trademark)
Corporate Headquarters
82 Devonshire St., Boston, MA 02109
www.fidelity.com

(Fidelity Investment logo)(registered trademark)

Fidelity® Advisor

Value

Fund - Class A, Class T, Class B
and Class C

Annual Report

October 31, 2006

(2_fidelity_logos) (Registered_Trademark)

Chairman's Message	<Click Here>	Ned Johnson's message to shareholders.
Performance	<Click Here>	How the fund has done over time.
Management's Discussion	<Click Here>	The manager's review of fund performance, strategy and outlook.
Shareholder Expense Example	<Click Here>	An example of shareholder expenses.
Investment Changes	<Click Here>	A summary of major shifts in the fund's investments over the past six months.
Investments	<Click Here>	A complete list of the fund's investments with their market values.
Financial Statements	<Click Here>	Statements of assets and liabilities, operations, and changes in net assets, as well as financial highlights.
Notes	<Click Here>	Notes to the financial statements.
Report of Independent Registered Public Accounting Firm	<Click Here>
Trustees and Officers	<Click Here>
Distributions	<Click Here>
Board Approval of Investment Advisory Contracts and Management Fees	<Click Here>

Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.

Other third party marks appearing herein are the property of their respective owners.

All other marks appearing herein are registered or unregistered trademarks or service marks of FMR Corp. or an affiliated company.

Annual Report

NOT FDIC INSURED· MAY LOSE VALUE· NO BANK GUARANTEE

Neither the fund nor Fidelity Distributors Corporation is a bank.

Annual Report

Chairman's Message

(photo_of_Edward_C_Johnson_3d)

Dear Shareholder:

Sincerely,

/s/Edward C. Johnson 3d

Edward C. Johnson 3d

Annual Report

Performance: The Bottom Line

Average Annual Total Returns

Periods ended October 31, 2006	Past 1 year	Life of fund^A
Class A (incl. 5.75% sales charge)	11.32%	13.03%
Class T (incl. 3.50% sales charge)	13.66%	13.68%
Class B (incl. contingent deferred sales charge)^B	12.21%	13.72%
Class C (incl. contingent deferred sales charge)^C	16.22%	14.53%

^AFrom December 23, 2003.

^B Class B shares' contingent deferred sales charge included in the past one year and life of fund total return figures are 5% and 3%, respectively.

^C Class C shares' contingent deferred sales charge included in the past one year and life of fund total return figures are 1% and 0%, respectively.

$10,000 Over Life of Fund

Let's say hypothetically that $10,000 was invested in Fidelity® Advisor Value - Class T on December 23, 2003, when the fund started, and the current 3.50% sales charge was paid. The chart shows how the value of your investment would have changed, and also shows how the Russell Midcap® Value Index performed over the same period.

Annual Report

Management's Discussion of Fund Performance

Comments from Richard Fentin, Portfolio Manager of Fidelity® Advisor Value Fund

U.S. equity investors had much to feel good about during the 12-month period ending October 31, 2006. On October 3, the Dow Jones Industrial Average^SM closed above its all-time high set back in January 2000. On October 19 - the 19^th anniversary of the 1987 stock market crash - the Dow made history again, recording its first close above 12,000. The Dow finished the 12-month period with a gain of 18.47%. The Standard & Poor's 500^SM Index and the NASDAQ Composite® Index also did well, returning 16.34% and 12.49%, respectively. There were a number of reasons for the equity market's impressive results, particularly the consistently strong quarterly earnings reported by U.S. corporations. The Federal Reserve Board also played a significant role. Though its inflation fighting efforts caused investors anguish at times, the Board seemed to successfully accomplish its mission of engineering a "soft landing" - where inflation doesn't get too hot and economic growth doesn't get too cold - leading to what Wall Street calls a "Goldilocks economy."

For the 12 months that ended October 31, 2006, the fund's Class A, Class T, Class B and Class C shares returned 18.11%, 17.78%, 17.21% and 17.22%, respectively (excluding sales charges), while the Russell Midcap® Value Index gained 20.51%. The fund lagged the index partly due to its underexposure to strong performing real estate investment trusts (REITs). Weak stock selection in the materials sector also hurt performance, including overweighting glass container maker Owens-Illinois, having only a small position in steelmaker Nucor and not owning paper products giant Georgia-Pacific. Not investing in other strong performing index components Archer-Daniels-Midland, Kerr-McGee and Qwest Communications detracted as well. Some overweighted holdings in health care also disappointed. Specifically, Community Health Systems fell on weak business fundamentals, while corporate problems at video game producer Take-Two Interactive hampered returns. The fund's modest cash position throughout the period also hurt. On the other hand, the portfolio benefited from several out-of-index technology holdings, including disk-drive manufacturers Western Digital and Maxtor, which was acquired by Seagate Technology during the period. An overweighting in Symbol Technologies boosted relative performance when Motorola announced it would acquire the company. Out-of-index engineering and construction leader Fluor worked well, as did overweighted investments in several turnaround stories in retailing, including Ann Taylor, OfficeMax and Big Lots. Lastly, security selection in energy and an underweighting in interest-rate-sensitive utilities stocks provided additional gains relative to the index.

Annual Report

Shareholder Expense Example

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (May 1, 2006 to October 31, 2006).

Actual Expenses

Hypothetical Example for Comparison Purposes

	Beginning Account Value May 1, 2006	Ending Account Value October 31, 2006	Expenses Paid During Period* May 1, 2006 to October 31, 2006
Class A
Actual	$ 1,000.00	$ 1,023.60	$ 6.38
Hypothetical^A	$ 1,000.00	$ 1,018.90	$ 6.36
Class T
Actual	$ 1,000.00	$ 1,022.30	$ 7.65
Hypothetical^A	$ 1,000.00	$ 1,017.64	$ 7.63
Class B
Actual	$ 1,000.00	$ 1,020.30	$ 10.18
Hypothetical^A	$ 1,000.00	$ 1,015.12	$ 10.16
	Beginning Account Value May 1, 2006	Ending Account Value October 31, 2006	Expenses Paid During Period* May 1, 2006 to October 31, 2006
Class C
Actual	$ 1,000.00	$ 1,020.30	$ 10.18
Hypothetical^A	$ 1,000.00	$ 1,015.12	$ 10.16
Institutional Class
Actual	$ 1,000.00	$ 1,024.80	$ 5.10
Hypothetical^A	$ 1,000.00	$ 1,020.16	$ 5.09

^A5% return per year before expenses

	Annualized Expense Ratio
Class A	1.25%
Class T	1.50%
Class B	2.00%
Class C	2.00%
Institutional Class	1.00%

Annual Report

Investment Changes

Top Ten Stocks as of October 31, 2006
	% of fund's net assets	% of fund's net assets 6 months ago
Baxter International, Inc.	2.0	1.8
Xerox Corp.	1.5	1.3
Tyco International Ltd.	1.3	1.2
Safeway, Inc.	1.2	1.3
Symbol Technologies, Inc.	1.2	0.8
Avon Products, Inc.	1.1	1.1
Agilent Technologies, Inc.	1.0	1.0
Flextronics International Ltd.	1.0	0.9
Ceridian Corp.	1.0	1.0
Fannie Mae	1.0	0.8
	12.3
Top Five Market Sectors as of October 31, 2006
	% of fund's net assets	% of fund's net assets 6 months ago
Information Technology	19.4	18.7
Consumer Discretionary	18.6	15.4
Financials	14.1	12.6
Health Care	12.4	12.5
Industrials	8.1	8.9

Asset Allocation (% of fund's net assets)
As of October 31, 2006*			As of April 30, 2006**
	Stocks 96.3%			Stocks 94.1%
	Bonds 0.1%			Bonds 0.1%
	Convertible Securities 0.1%			Convertible Securities 0.4%
	Short-Term Investments and Net Other Assets 3.5%			Short-Term Investments and Net Other Assets 5.4%
* Foreign investments		10.2%	** Foreign investments		10.0%

Annual Report

Investments October 31, 2006

Showing Percentage of Net Assets

Common Stocks - 96.2%
	Shares		Value (Note 1)
CONSUMER DISCRETIONARY - 18.6%
Auto Components - 0.0%
Gentex Corp.	3,900		$ 62,049
Automobiles - 0.7%
Harley-Davidson, Inc. (d)	1,200		82,356
Monaco Coach Corp.	5,500		65,670
Nissan Motor Co. Ltd.	22,702		271,935
Renault SA	4,500		526,419
			946,380
Diversified Consumer Services - 0.0%
Service Corp. International (SCI)	5,800		52,896
Hotels, Restaurants & Leisure - 4.1%
Applebee's International, Inc.	5,700		130,074
Aristocrat Leisure Ltd.	11,600		125,093
Boyd Gaming Corp.	7,400		292,078
Brinker International, Inc.	18,020		836,669
Carnival Corp. unit	22,800		1,113,096
Domino's Pizza, Inc.	9,000		244,620
Gaylord Entertainment Co. (a)	6,900		321,126
Harrah's Entertainment, Inc.	1,654		122,942
OSI Restaurant Partners, Inc. (d)	16,950		563,927
Rare Hospitality International, Inc. (a)	6,000		189,060
Royal Caribbean Cruises Ltd.	25,960		1,051,380
WMS Industries, Inc. (a)	11,000		388,630
			5,378,695
Household Durables - 3.1%
Ethan Allen Interiors, Inc.	4,800		170,976
Jarden Corp. (a)(d)	12,000		431,760
La-Z-Boy, Inc.	12,200		149,450
Leggett & Platt, Inc.	36,200		845,270
Matsushita Electric Industrial Co. Ltd.	9,000		187,200
Newell Rubbermaid, Inc.	16,890		486,094
Samson Holding Ltd.	11,000		5,375
Sealy Corp., Inc.	22,300		313,761
Sony Corp. sponsored ADR	2,900		118,842
The Stanley Works	19,300		919,645
Whirlpool Corp.	4,600		399,878
			4,028,251
Leisure Equipment & Products - 1.3%
Brunswick Corp.	20,130		634,095
Common Stocks - continued
	Shares		Value (Note 1)
CONSUMER DISCRETIONARY - continued
Leisure Equipment & Products - continued
Eastman Kodak Co. (d)	40,720		$ 993,568
Polaris Industries, Inc. (d)	2,700		115,614
			1,743,277
Media - 4.0%
CBS Corp. Class B	4,312		124,789
Clear Channel Communications, Inc.	21,800		759,730
E.W. Scripps Co. Class A	9,040		447,118
Gannett Co., Inc.	16,700		987,638
Lamar Advertising Co. Class A (a)	4,500		259,560
Live Nation, Inc. (a)	6,162		131,004
Omnicom Group, Inc.	5,400		547,830
R.H. Donnelley Corp.	4,300		258,946
The New York Times Co. Class A (d)	18,600		449,562
The Reader's Digest Association, Inc. (non-vtg.)	26,410		379,776
Tribune Co.	14,700		489,951
Viacom, Inc. Class B (non-vtg.) (a)	9,412		366,315
			5,202,219
Multiline Retail - 1.5%
Big Lots, Inc. (a)	34,280		722,622
Dollar General Corp.	10,800		151,524
Family Dollar Stores, Inc.	30,900		910,005
Sears Holdings Corp. (a)	800		139,576
			1,923,727
Specialty Retail - 3.1%
AnnTaylor Stores Corp. (a)	3,500		154,070
AutoNation, Inc. (a)	6,402		128,360
AutoZone, Inc. (a)	1,700		190,400
Best Buy Co., Inc.	3,200		176,800
Gap, Inc. (d)	42,700		897,554
Hot Topic, Inc. (a)	13,000		131,430
OfficeMax, Inc.	21,100		1,003,938
PETsMART, Inc.	16,700		480,626
RadioShack Corp.	7,200		128,448
Tiffany & Co., Inc.	20,600		735,832
			4,027,458
Textiles, Apparel & Luxury Goods - 0.8%
Brown Shoe Co., Inc.	2,500		97,400
Common Stocks - continued
	Shares		Value (Note 1)
CONSUMER DISCRETIONARY - continued
Textiles, Apparel & Luxury Goods - continued
Liz Claiborne, Inc.	22,140		$ 933,644
Warnaco Group, Inc. (a)	4,400		93,456
			1,124,500
TOTAL CONSUMER DISCRETIONARY			24,489,452
CONSUMER STAPLES - 5.5%
Beverages - 0.5%
Coca-Cola Enterprises, Inc.	7,175		143,715
Cott Corp. (a)	15,100		220,854
SABMiller PLC	17,300		334,617
			699,186
Food & Staples Retailing - 2.0%
Kroger Co.	17,400		391,326
Rite Aid Corp.	22,600		105,768
Safeway, Inc.	52,920		1,553,731
Sysco Corp.	18,000		629,640
			2,680,465
Food Products - 0.6%
Corn Products International, Inc.	10,400		376,376
McCormick & Co., Inc. (non-vtg.)	1,799		67,283
TreeHouse Foods, Inc. (a)	4,378		111,026
Tyson Foods, Inc. Class A	14,800		213,860
			768,545
Household Products - 0.6%
Colgate-Palmolive Co.	12,800		818,816
Personal Products - 1.2%
Avon Products, Inc.	45,800		1,392,778
Herbalife Ltd. (a)	1,900		69,540
Playtex Products, Inc. (a)	3,200		44,608
			1,506,926
Tobacco - 0.6%
Altria Group, Inc.	9,300		756,369
TOTAL CONSUMER STAPLES			7,230,307
ENERGY - 6.8%
Energy Equipment & Services - 5.1%
Baker Hughes, Inc.	7,100		490,255
Common Stocks - continued
	Shares		Value (Note 1)
ENERGY - continued
Energy Equipment & Services - continued
Cameron International Corp. (a)	13,900		$ 696,390
ENSCO International, Inc.	7,970		390,291
FMC Technologies, Inc. (a)	13,730		829,979
GlobalSantaFe Corp.	7,100		368,490
Halliburton Co.	18,800		608,180
National Oilwell Varco, Inc. (a)	15,880		959,152
Noble Corp.	5,390		377,839
Pride International, Inc. (a)	5,890		162,623
Smith International, Inc.	23,900		943,572
Transocean, Inc. (a)	6,130		444,670
Weatherford International Ltd. (a)	11,120		456,810
			6,728,251
Oil, Gas & Consumable Fuels - 1.7%
Alpha Natural Resources, Inc. (a)	2,300		36,593
Arch Coal, Inc.	9,530		330,024
Cabot Oil & Gas Corp.	5,300		280,423
El Paso Corp.	20,300		278,110
EOG Resources, Inc.	4,800		319,344
EXCO Resources, Inc.	7,700		111,496
Foundation Coal Holdings, Inc.	10,500		385,455
Noble Energy, Inc.	4,100		199,383
Ultra Petroleum Corp. (a)	4,700		250,839
			2,191,667
TOTAL ENERGY			8,919,918
FINANCIALS - 14.0%
Capital Markets - 1.4%
Ameriprise Financial, Inc.	1,800		92,700
Janus Capital Group, Inc. (d)	12,030		241,562
Merrill Lynch & Co., Inc.	10,400		909,168
State Street Corp.	4,800		308,304
TD Ameritrade Holding Corp.	15,652		257,788
			1,809,522
Commercial Banks - 1.2%
Boston Private Financial Holdings, Inc.	6,105		168,742
National Australia Bank Ltd.	3,482		102,510
Popular, Inc.	3,500		63,665
UCBH Holdings, Inc.	12,292		210,685
UnionBanCal Corp.	1,450		83,491
Common Stocks - continued
	Shares		Value (Note 1)
FINANCIALS - continued
Commercial Banks - continued
Wachovia Corp.	14,650		$ 813,075
Zions Bancorp	2,100		168,840
			1,611,008
Consumer Finance - 0.5%
Capital One Financial Corp.	8,700		690,171
Diversified Financial Services - 0.6%
Bank of America Corp.	6,768		364,592
FirstRand Ltd.	20,200		52,843
JPMorgan Chase & Co.	8,100		384,264
			801,699
Insurance - 3.9%
AFLAC, Inc.	15,650		702,998
AMBAC Financial Group, Inc.	9,360		781,466
Genworth Financial, Inc. Class A (non-vtg.)	6,300		210,672
Marsh & McLennan Companies, Inc.	16,120		474,573
MBIA, Inc.	13,390		830,448
MetLife, Inc.	5,160		294,791
Montpelier Re Holdings Ltd.	3,400		60,350
Prudential Financial, Inc.	5,500		423,115
Reinsurance Group of America, Inc.	2,600		146,640
Scottish Re Group Ltd.	7,070		80,810
The St. Paul Travelers Companies, Inc.	13,030		666,224
Willis Group Holdings Ltd.	12,400		471,572
			5,143,659
Real Estate Investment Trusts - 4.2%
Alexandria Real Estate Equities, Inc.	3,300		329,010
American Financial Realty Trust (SBI)	15,200		177,384
Annaly Capital Management, Inc.	7,400		97,088
Brandywine Realty Trust (SBI)	5,200		173,472
Developers Diversified Realty Corp.	7,400		450,660
Digital Realty Trust, Inc.	2,800		93,492
Duke Realty Corp.	6,890		276,013
Education Realty Trust, Inc.	7,100		109,837
Equity Office Properties Trust	8,500		361,250
Equity Residential (SBI)	9,700		529,717
General Growth Properties, Inc.	12,920		670,548
GMH Communities Trust	7,700		107,569
Kimco Realty Corp.	10,400		462,072
Pennsylvania (REIT) (SBI)	7,800		336,180
Public Storage, Inc.	3,900		349,869
Common Stocks - continued
	Shares		Value (Note 1)
FINANCIALS - continued
Real Estate Investment Trusts - continued
United Dominion Realty Trust, Inc. (SBI)	15,200		$ 492,024
Vornado Realty Trust	3,920		467,460
			5,483,645
Thrifts & Mortgage Finance - 2.2%
Countrywide Financial Corp.	13,960		532,155
Fannie Mae	21,340		1,264,608
Freddie Mac	12,170		839,608
Hudson City Bancorp, Inc.	13,400		183,982
			2,820,353
TOTAL FINANCIALS			18,360,057
HEALTH CARE - 12.3%
Biotechnology - 0.7%
Cephalon, Inc. (a)(d)	8,100		568,458
MedImmune, Inc. (a)	5,800		185,832
Myogen, Inc. (a)	2,142		112,027
			866,317
Health Care Equipment & Supplies - 3.0%
Baxter International, Inc.	56,664		2,604,842
Becton, Dickinson & Co.	9,670		677,190
Boston Scientific Corp. (a)	3,700		58,867
CONMED Corp. (a)	8,996		199,621
Dade Behring Holdings, Inc.	4,338		158,033
Wright Medical Group, Inc. (a)	10,700		264,397
			3,962,950
Health Care Providers & Services - 5.9%
AmerisourceBergen Corp.	7,400		349,280
Brookdale Senior Living, Inc.	5,300		255,036
Chemed Corp.	6,400		227,136
Community Health Systems, Inc. (a)	24,510		795,350
HCA, Inc.	14,340		724,457
Health Net, Inc. (a)	12,800		531,328
Laboratory Corp. of America Holdings (a)	4,100		280,809
McKesson Corp.	18,400		921,656
Medco Health Solutions, Inc. (a)	10,700		572,450
Omnicare, Inc.	10,185		385,808
Quest Diagnostics, Inc.	19,860		987,836
Triad Hospitals, Inc. (a)	8,070		298,832
Common Stocks - continued
	Shares		Value (Note 1)
HEALTH CARE - continued
Health Care Providers & Services - continued
United Surgical Partners International, Inc. (a)	16,906		$ 419,607
UnitedHealth Group, Inc.	1,800		87,804
Universal Health Services, Inc. Class B	18,070		956,807
			7,794,196
Life Sciences Tools & Services - 1.4%
Charles River Laboratories International, Inc. (a)	16,800		721,056
Fisher Scientific International, Inc. (a)	5,720		489,746
Varian, Inc. (a)	7,960		373,244
Waters Corp. (a)	6,500		323,700
			1,907,746
Pharmaceuticals - 1.3%
Schering-Plough Corp.	51,790		1,146,631
Teva Pharmaceutical Industries Ltd. sponsored ADR	16,900		557,193
			1,703,824
TOTAL HEALTH CARE			16,235,033
INDUSTRIALS - 8.1%
Aerospace & Defense - 0.2%
Honeywell International, Inc.	8,340		351,281
Airlines - 0.7%
Ryanair Holdings PLC sponsored ADR (a)(d)	7,010		468,408
Southwest Airlines Co.	13,800		207,414
TAM SA (PN) sponsored ADR (ltd. vtg.)	8,000		244,400
			920,222
Building Products - 1.1%
American Standard Companies, Inc.	6,600		292,314
Goodman Global, Inc.	6,000		96,420
Masco Corp.	38,470		1,063,696
			1,452,430
Commercial Services & Supplies - 1.1%
Allied Waste Industries, Inc.	16,116		195,809
Clean Harbors, Inc. (a)	2,567		109,842
Navigant Consulting, Inc. (a)	13,200		235,092
Pike Electric Corp. (a)	5,700		105,165
Steelcase, Inc. Class A	4,180		69,263
The Brink's Co.	14,000		734,860
			1,450,031
Common Stocks - continued
	Shares		Value (Note 1)
INDUSTRIALS - continued
Construction & Engineering - 0.6%
Fluor Corp.	9,570		$ 750,575
Industrial Conglomerates - 1.3%
Tyco International Ltd.	58,050		1,708,412
Machinery - 1.5%
Albany International Corp. Class A	4,050		136,121
Briggs & Stratton Corp.	16,300		415,487
Deere & Co.	9,000		766,170
Mueller Water Products, Inc. Class A (d)	4,500		71,865
SPX Corp.	7,050		405,516
Wabash National Corp.	10,163		142,587
			1,937,746
Road & Rail - 1.4%
Canadian National Railway Co.	7,110		338,828
Con-way, Inc.	11,400		537,738
CSX Corp.	1,700		60,639
Laidlaw International, Inc.	32,825		952,253
			1,889,458
Transportation Infrastructure - 0.2%
Macquarie Infrastructure Co. Trust	8,227		245,411
TOTAL INDUSTRIALS			10,705,566
INFORMATION TECHNOLOGY - 19.4%
Communications Equipment - 1.1%
Alcatel SA sponsored ADR (d)	24,280		308,356
Dycom Industries, Inc. (a)	20,330		473,892
Lucent Technologies, Inc. (a)	43,700		106,191
Motorola, Inc.	14,950		344,747
Nortel Networks Corp. (a)	87,600		195,348
			1,428,534
Computers & Peripherals - 3.5%
Brocade Communications Systems, Inc. (a)	7,000		56,770
Diebold, Inc.	12,600		550,368
EMC Corp. (a)	18,700		229,075
Imation Corp.	6,174		282,584
Intermec, Inc. (a)	14,230		321,598
Komag, Inc. (a)	3,100		118,575
NCR Corp. (a)	23,900		992,328
Seagate Technology	49,860		1,125,839
Common Stocks - continued
	Shares		Value (Note 1)
INFORMATION TECHNOLOGY - continued
Computers & Peripherals - continued
Sun Microsystems, Inc. (a)	34,900		$ 189,507
Western Digital Corp. (a)	39,050		713,834
			4,580,478
Electronic Equipment & Instruments - 5.9%
Agilent Technologies, Inc. (a)	38,600		1,374,160
Arrow Electronics, Inc. (a)	22,580		674,013
Avnet, Inc. (a)	33,020		781,914
CDW Corp.	7,700		505,659
Celestica, Inc. (sub. vtg.) (a)	82,510		809,923
Flextronics International Ltd. (a)	112,470		1,304,652
Ingram Micro, Inc. Class A (a)	18,400		379,224
Mettler-Toledo International, Inc. (a)	2,760		189,474
Solectron Corp. (a)	66,190		221,075
Symbol Technologies, Inc.	101,770		1,519,426
			7,759,520
Internet Software & Services - 0.4%
Open Text Corp. (a)	3,700		67,267
Yahoo!, Inc. (a)	15,000		395,100
			462,367
IT Services - 1.8%
Ceridian Corp. (a)	55,030		1,297,057
Hewitt Associates, Inc. Class A (a)	28,300		708,349
Satyam Computer Services Ltd. sponsored ADR	17,400		384,714
			2,390,120
Office Electronics - 1.5%
Xerox Corp. (a)	118,170		2,008,890
Semiconductors & Semiconductor Equipment - 3.7%
AMIS Holdings, Inc. (a)	16,535		158,571
Amkor Technology, Inc. (a)	8,300		57,353
Applied Materials, Inc.	40,500		704,295
ASML Holding NV (NY Shares) (a)	35,900		819,956
DSP Group, Inc. (a)	3,769		81,863
Fairchild Semiconductor International, Inc. (a)	47,390		763,453
Integrated Device Technology, Inc. (a)	12,500		198,125
Intersil Corp. Class A	12,200		286,090
Maxim Integrated Products, Inc.	12,200		366,122
MKS Instruments, Inc. (a)	13,352		289,071
Common Stocks - continued
	Shares		Value (Note 1)
INFORMATION TECHNOLOGY - continued
Semiconductors & Semiconductor Equipment - continued
National Semiconductor Corp.	39,700		$ 964,313
Spansion, Inc. Class A	10,628		151,555
			4,840,767
Software - 1.5%
Fair, Isaac & Co., Inc.	9,079		332,564
Hyperion Solutions Corp. (a)	8,627		322,650
Parametric Technology Corp. (a)	6,900		134,826
Quest Software, Inc. (a)	6,200		91,326
Symantec Corp. (a)	33,299		660,652
Take-Two Interactive Software, Inc. (a)	14,500		202,855
THQ, Inc. (a)	9,370		281,756
			2,026,629
TOTAL INFORMATION TECHNOLOGY			25,497,305
MATERIALS - 3.7%
Chemicals - 1.6%
Arkema sponsored ADR (a)	1,500		72,600
Ashland, Inc.	5,530		326,823
Celanese Corp. Class A	17,875		368,404
Chemtura Corp.	65,704		563,740
Cytec Industries, Inc.	13,600		753,304
Georgia Gulf Corp.	3,300		70,587
OMNOVA Solutions, Inc. (a)	5,592		24,493
			2,179,951
Containers & Packaging - 0.9%
Owens-Illinois, Inc.	68,881		1,143,425
Metals & Mining - 1.2%
Alcan, Inc.	10,550		494,962
Alcoa, Inc.	18,370		531,077
Newmont Mining Corp.	4,780		216,391
Oregon Steel Mills, Inc. (a)	3,200		174,080
Titanium Metals Corp. (a)	4,000		117,920
			1,534,430
TOTAL MATERIALS			4,857,806
Common Stocks - continued
	Shares		Value (Note 1)
TELECOMMUNICATION SERVICES - 3.5%
Diversified Telecommunication Services - 2.4%
Alaska Communication Systems Group, Inc.	16,600		$ 238,874
AT&T, Inc.	21,470		735,348
BellSouth Corp.	16,910		762,641
CenturyTel, Inc.	160		6,438
Citizens Communications Co.	25,630		375,736
Iowa Telecommunication Services, Inc.	5,912		117,885
NTELOS Holding Corp.	9,500		133,285
Verizon Communications, Inc.	16,340		604,580
Windstream Corp.	10,339		141,851
			3,116,638
Wireless Telecommunication Services - 1.1%
ALLTEL Corp.	10,600		565,086
Dobson Communications Corp. Class A	35,700		277,032
MTN Group Ltd.	4,100		37,291
Philippine Long Distance Telephone Co. sponsored ADR (d)	1,900		90,459
Sprint Nextel Corp.	24,200		452,298
			1,422,166
TOTAL TELECOMMUNICATION SERVICES			4,538,804
UTILITIES - 4.3%
Electric Utilities - 2.4%
Allegheny Energy, Inc. (a)	10,000		430,300
Edison International	16,060		713,706
Entergy Corp.	6,370		546,737
Exelon Corp.	7,500		464,850
FPL Group, Inc.	9,800		499,800
PPL Corp.	15,020		518,490
			3,173,883
Gas Utilities - 0.1%
Equitable Resources, Inc.	2,601		105,393
Independent Power Producers & Energy Traders - 1.3%
AES Corp. (a)	18,630		409,674
Constellation Energy Group, Inc.	3,300		205,920
NRG Energy, Inc.	10,700		515,205
TXU Corp.	9,280		585,846
			1,716,645
Multi-Utilities - 0.5%
CMS Energy Corp. (a)	15,200		226,328
Common Stocks - continued
	Shares		Value (Note 1)
UTILITIES - continued
Multi-Utilities - continued
Dominion Resources, Inc.	2,551		$ 206,605
Public Service Enterprise Group, Inc.	4,800		293,040
			725,973
TOTAL UTILITIES			5,721,894
TOTAL COMMON STOCKS (Cost $113,525,644)		126,556,142
Preferred Stocks - 0.2%

Convertible Preferred Stocks - 0.1%
MATERIALS - 0.1%
Containers & Packaging - 0.1%
Owens-Illinois, Inc. 4.75%	5,170		181,519
Nonconvertible Preferred Stocks - 0.1%
FINANCIALS - 0.1%
Thrifts & Mortgage Finance - 0.1%
Fannie Mae 7.00%	1,300		69,550
TOTAL PREFERRED STOCKS (Cost $260,117)		251,069

Nonconvertible Bonds - 0.1%
	Principal Amount
CONSUMER DISCRETIONARY - 0.0%
Leisure Equipment & Products - 0.0%
K2, Inc. 7.375% 7/1/14	$ 10,000		9,875
HEALTH CARE - 0.1%
Health Care Providers & Services - 0.1%
Tenet Healthcare Corp. 6.375% 12/1/11	30,000		26,925
INFORMATION TECHNOLOGY - 0.0%
Electronic Equipment & Instruments - 0.0%
Celestica, Inc. 7.875% 7/1/11	20,000		20,150
TOTAL NONCONVERTIBLE BONDS (Cost $57,151)		56,950

Money Market Funds - 7.1%
	Shares		Value (Note 1)
Fidelity Cash Central Fund, 5.34% (b)	4,336,991		$ 4,336,991
Fidelity Securities Lending Cash Central Fund, 5.35% (b)(c)	5,035,200		5,035,200
TOTAL MONEY MARKET FUNDS (Cost $9,372,191)		9,372,191
TOTAL INVESTMENT PORTFOLIO - 103.6% (Cost $123,215,103)			136,236,352
NET OTHER ASSETS - (3.6)%			(4,701,702)
NET ASSETS - 100%		$ 131,534,650

Legend

(a) Non-income producing

(b) Affiliated fund that is available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request.

(d) Security or a portion of the security is on loan at period end.

Affiliated Central Funds

Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:

Fund	Income earned
Fidelity Cash Central Fund	$ 276,882
Fidelity Securities Lending Cash Central Fund	4,620
Total	$ 281,502

Other Information

Distribution of investments by country of issue, as a percentage of total net assets, is as follows:

United States of America	89.8%
Canada	1.9%
Cayman Islands	1.7%
Singapore	1.0%
Others (individually less than 1%)	5.6%
	100.0%

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Statements

Statement of Assets and Liabilities

	October 31, 2006

Assets
Investment in securities, at value (including securities loaned of $4,922,181) - See accompanying schedule: Unaffiliated issuers (cost $113,842,912)	$ 126,864,161
Fidelity Central Funds (cost $9,372,191)	9,372,191
Total Investments (cost $123,215,103)		$ 136,236,352
Cash		10,372
Receivable for investments sold		691,543
Receivable for fund shares sold		300,273
Dividends receivable		74,124
Interest receivable		24,502
Other receivables		1,644
Total assets		137,338,810

Liabilities
Payable for investments purchased	$ 477,064
Payable for fund shares redeemed	96,850
Accrued management fee	62,614
Distribution fees payable	55,179
Other affiliated payables	37,457
Other payables and accrued expenses	39,796
Collateral on securities loaned, at value	5,035,200
Total liabilities		5,804,160

Net Assets		$ 131,534,650
Net Assets consist of:
Paid in capital		$ 114,562,740
Undistributed net investment income		1,045
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions		3,949,632
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies		13,021,233
Net Assets		$ 131,534,650

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Statements - continued

Statement of Assets and Liabilities - continued

	October 31, 2006

Calculation of Maximum Offering Price Class A: Net Asset Value and redemption price per share ($47,960,046 ÷ 3,246,345 shares)		$ 14.77

Maximum offering price per share (100/94.25 of $14.77)		$ 15.67
Class T: Net Asset Value and redemption price per share ($43,716,417 ÷ 2,973,216 shares)		$ 14.70

Maximum offering price per share (100/96.50 of $14.70)		$ 15.23
Class B: Net Asset Value and offering price per share ($14,625,218 ÷ 1,003,572 shares)^A		$ 14.57

Class C: Net Asset Value and offering price per share ($19,093,452 ÷ 1,312,105 shares)^A		$ 14.55

Institutional Class: Net Asset Value, offering price and redemption price per share ($6,139,517 ÷ 413,337 shares)		$ 14.85

^A Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Statement of Operations

	Year ended October 31, 2006

Investment Income
Dividends		$ 1,222,032
Interest		4,792
Income from Fidelity Central Funds		281,502
Total income		1,508,326

Expenses
Management fee	$ 575,460
Transfer agent fees	333,835
Distribution fees	549,765
Accounting and security lending fees	42,238
Custodian fees and expenses	63,177
Independent trustees' compensation	368
Registration fees	60,067
Audit	43,518
Legal	2,313
Miscellaneous	4,795
Total expenses before reductions	1,675,536
Expense reductions	(113,600)	1,561,936
Net investment income (loss)		(53,610)
Realized and Unrealized Gain (Loss) Net realized gain (loss) on:
Investment securities:
Unaffiliated issuers	4,079,457
Foreign currency transactions	(1,526)
Total net realized gain (loss)		4,077,931
Change in net unrealized appreciation (depreciation) on: Investment securities	10,142,070
Assets and liabilities in foreign currencies	127
Total change in net unrealized appreciation (depreciation)		10,142,197
Net gain (loss)		14,220,128
Net increase (decrease) in net assets resulting from operations		$ 14,166,518

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Statements - continued

Statement of Changes in Net Assets

	Year ended October 31, 2006	Year ended October 31, 2005
Increase (Decrease) in Net Assets
Operations
Net investment income (loss)	$ (53,610)	$ (122,204)
Net realized gain (loss)	4,077,931	1,215,382
Change in net unrealized appreciation (depreciation)	10,142,197	2,150,637
Net increase (decrease) in net assets resulting from operations	14,166,518	3,243,815
Distributions to shareholders from net realized gain	(1,071,267)	(25,096)
Share transactions - net increase (decrease)	56,605,448	43,755,669
Total increase (decrease) in net assets	69,700,699	46,974,388

Net Assets
Beginning of period	61,833,951	14,859,563
End of period (including undistributed net investment income of $1,045 and undistributed net investment income of $616, respectively)	$ 131,534,650	$ 61,833,951

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Class A

Years ended October 31,	2006	2005	2004^I
Selected Per-Share Data
Net asset value, beginning of period	$ 12.72	$ 11.10	$ 10.00
Income from Investment Operations
Net investment income (loss)^E	.03	.01	(.02)^H
Net realized and unrealized gain (loss)	2.25	1.64	1.12
Total from investment operations	2.28	1.65	1.10
Distributions from net realized gain	(.23)	(.03)	-
Net asset value, end of period	$ 14.77	$ 12.72	$ 11.10
Total Return^{B, C, D}	18.11%	14.84%	11.00%
Ratios to Average Net Assets^{F, J}
Expenses before reductions	1.35%	1.62%	4.33%^A
Expenses net of fee waivers, if any	1.25%	1.27%	1.50%^A
Expenses net of all reductions	1.24%	1.26%	1.48%^A
Net investment income (loss)	.24%	.04%	(.17)%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 47,960	$ 15,657	$ 2,543
Portfolio turnover rate^G	35%	25%	30%^A

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns would have been lower had certain expenses not been reduced during the periods shown.

^D Total returns do not include the effect of the sales charges.

^E Calculated based on average shares outstanding during the period.

^F Fees and expenses of the underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.

^G Amount does not include the portfolio activity of any underlying Fidelity Central Funds.

^H Investment income per share reflects a special dividend which amounted to $.01 per share.

^I For the period December 23, 2003 (commencement of operations) to October 31, 2004.

^J Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Class T

Years ended October 31,	2006	2005	2004^I
Selected Per-Share Data
Net asset value, beginning of period	$ 12.67	$ 11.08	$ 10.00
Income from Investment Operations
Net investment income (loss)^E	-^K	(.03)	(.04)^H
Net realized and unrealized gain (loss)	2.23	1.64	1.12
Total from investment operations	2.23	1.61	1.08
Distributions from net realized gain	(.20)	(.02)	-
Net asset value, end of period	$ 14.70	$ 12.67	$ 11.08
Total Return^{B, C, D}	17.78%	14.54%	10.80%
Ratios to Average Net Assets^{F, J}
Expenses before reductions	1.59%	1.86%	4.29%^A
Expenses net of fee waivers, if any	1.50%	1.53%	1.75%^A
Expenses net of all reductions	1.49%	1.52%	1.73%^A
Net investment income (loss)	(.01)%	(.21)%	(.42)%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 43,716	$ 22,938	$ 5,581
Portfolio turnover rate^G	35%	25%	30%^A

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns would have been lower had certain expenses not been reduced during the periods shown.

^D Total returns do not include the effect of the sales charges.

^E Calculated based on average shares outstanding during the period.

^G Amount does not include the portfolio activity of any underlying Fidelity Central Funds.

^H Investment income per share reflects a special dividend which amounted to $.01 per share.

^I For the period December 23, 2003 (commencement of operations) to October 31, 2004.

^K Amount represents less than $.01 per share.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Class B

Years ended October 31,	2006	2005	2004^I
Selected Per-Share Data
Net asset value, beginning of period	$ 12.57	$ 11.03	$ 10.00
Income from Investment Operations
Net investment income (loss)^E	(.07)	(.09)	(.08)^H
Net realized and unrealized gain (loss)	2.22	1.64	1.11
Total from investment operations	2.15	1.55	1.03
Distributions from net realized gain	(.15)	(.01)	-
Net asset value, end of period	$ 14.57	$ 12.57	$ 11.03
Total Return^{B, C, D}	17.21%	14.01%	10.30%
Ratios to Average Net Assets^{F, J}
Expenses before reductions	2.15%	2.44%	5.09%^A
Expenses net of fee waivers, if any	2.00%	2.04%	2.25%^A
Expenses net of all reductions	1.99%	2.02%	2.23%^A
Net investment income (loss)	(.51)%	(.72)%	(.93)%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 14,625	$ 12,084	$ 3,473
Portfolio turnover rate^G	35%	25%	30%^A

^A Annualized

^B Total returns for periods of less than one year are not annualized.

^C Total returns would have been lower had certain expenses not been reduced during the periods shown.

^D Total returns do not include the effect of the contingent deferred sales charge.

^E Calculated based on average shares outstanding during the period.

^G Amount does not include the portfolio activity of any underlying Fidelity Central Funds.

^H Investment income per share reflects a special dividend which amounted to $.01 per share.

^I For the period December 23, 2003 (commencement of operations) to October 31, 2004.

See accompanying notes which are an integral part of the financial statements.

Annual Report

Financial Highlights - Class C

Years ended October 31,	2006	2005	2004^I
Selected Per-Share Data
Net asset value, beginning of period	$ 12.57	$ 11.03	$ 10.00
Income from Investment Operations
Net investment income (loss)^E	(.07)	(.09)	(.08)^H
Net realized and unrealized gain (loss)	2.22	1.63	1.11
Total from investment operations	2.15	1.54	1.03
Distributions from net realized gain	(.17)	-	-
Net asset value, end of period	$ 14.55	$ 12.57	$ 11.03
Total Return^{B, C, D}	17.22%	13.96%	10.30%
Ratios to Average Net Assets^{F, J}
Expenses before reductions	2.13%	2.42%	5.11%^A
Expenses net of fee waivers, if any	2.00%	2.03%	2.25%^A
Expenses net of all reductions	1.99%	2.02%	2.23%^A
Net investment income (loss)	(.51)%	(.71)%	(.93)%^A
Supplemental Data
Net assets, end of period (000 omitted)	$ 19,093	$ 9,007	$ 2,372
Portfolio turnover rate^G	35%	25%	30%^A