Longleaf Partners Funds Trust N-CSR Certified annual shareholder report (management investment company)

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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: 811-4923

Longleaf Partners Funds Trust

(Exact name of registrant as specified in charter)

c/o Southeastern Asset Management, Inc.

6410 Poplar Avenue, Suite 900

                        Memphis, TN                          38119

(Address of principal executive offices)     (Zip code)

Andrew R. McCarroll, Esq.

Southeastern Asset Management, Inc.

6410 Poplar Ave., Suite 900

Memphis, TN 38119

(Name and address of agent for service)

Registrant’s telephone number, including area code: (901) 761-2474

Date of fiscal year end: December 31

Date of reporting period: June 30, 2007.

TABLE OF CONTENTS

 Ex-99.CERT Certification Required by Item 12(a)(2)

 Ex-99.906 CERT Certification Pursuant to Section 906

Item 1.     Longleaf Partners Funds Semi-Annual Report at June 30, 2007.

LONGLEAF PARTNERS FUNDS ^®

SEMI-ANNUAL REPORT

at June 30, 2007

PARTNERS FUND

SMALL-CAP FUND

INTERNATIONAL FUND

MANAGED BY:

SOUTHEASTERN ASSET MANAGEMENT, INC.^®

Memphis, TN

Cautionary Statement

One of Longleaf’s “Governing Principles” is that “we will communicate with our investment partners as candidly as possible,” because we believe our shareholders benefit from understanding our investment philosophy and approach. Our views and opinions regarding the investment prospects of our portfolio holdings and Funds are “forward looking statements” which may or may not be accurate over the long term. While we believe we have a reasonable basis for our appraisals and we have confidence in our opinions, actual results may differ materially from those we anticipate. Information provided in this report should not be considered a recommendation to purchase or sell any particular security.

You can identify forward looking statements by words like “believe,” “expect,” “anticipate,” or similar expressions when discussing prospects for particular portfolio holdings and/or one of the Funds. We cannot assure future results and achievements. You should not place undue reliance on forward looking statements, which speak only as of the date of this report. We disclaim any obligation to update or alter any forward looking statements, whether as a result of new information, future events, or otherwise. This material must be preceded or accompanied by a Prospectus. Please read the Prospectus carefully for a discussion of fees, expenses, and risks. Current performance may be lower or higher than the performance quoted herein. You may obtain a current copy of the Prospectus or more current performance information by calling 1-800-445-9469 or at Longleaf’s website (www.longleafpartners.com).

The price-to-value ratio (“P/V”) is a calculation that compares the prices of the stocks in a portfolio to Southeastern’s appraisal of their intrinsic values. P/V represents a single data point about a Fund, and should not be construed as something more. We caution our shareholders not to give this calculation undue weight. P/V alone tells nothing about:

•  The quality of the businesses we own or the managements that run them;

•  The cash held in the portfolio and when that cash will be invested;

•  The range or distribution of individual P/V’s that comprise the average; and

•  The sources of and changes in the P/V.

When all of the above information is considered, the P/V is a useful tool to gauge the attractiveness of a Fund’s potential opportunity. It does not, however, tell when that opportunity will be realized, nor does it guarantee that any particular company’s price will ever reach its value. We remind our shareholders who want to find a single silver bullet of information that investments are rarely that simple. To the extent an investor considers P/V in assessing a Fund’s return opportunity, the limits of this tool should be considered along with other factors relevant to each investor.

^© 2007 Longleaf Partners Funds Trust. All Rights Reserved.

LONGLEAF, LONGLEAF PARTNERS FUNDS and the pine cone logo are registered trademarks of Longleaf Partners Funds Trust. SOUTHEASTERN ASSET MANAGEMENT, INC. is a registered trademark.

CONTENTS

Letter to Shareholders		1
Longleaf Partners Fund (Partners Fund)
	Management Discussion	6
	Performance History	8
	Portfolio Summary	9
	Portfolio of Investments	10
Longleaf Partners Small-Cap Fund (Small-Cap Fund)
	Management Discussion	14
	Performance History	16
	Portfolio Summary	17
	Portfolio of Investments	18
Longleaf Partners International Fund (International Fund)
	Management Discussion	20
	Performance History	22
	Portfolio Summary	23
	Portfolio of Investments	24
Financial Statements and Footnotes		28
Financial Highlights		40
Expense Example		42
Fund Information		45
Service Directory		47

Longleaf Partners Funds

LETTER TO SHAREHOLDERS

July 18, 2007

TO OUR SHAREHOLDERS:

We are pleased to report another strong quarter for the Longleaf Funds. Over the last three months the Partners Fund and International Fund significantly outperformed their benchmark indices and surpassed our annual goal of inflation plus 10%. As shown below, over the life of the Funds, over the last 12 months, and year-to-date, each Longleaf Fund has delivered substantial absolute returns while outpacing their relevant indices.

	Cumulative Total Returns at June 30, 2007
										2nd
	Inception			1 Year			Year-to-Date			Quarter
Partners Fund (4/8/87 IPO)		1,435.3	%		23.3	%		10.5	%		8.1	%
Inflation plus 10%		1,115.0			12.7			7.5			3.8
S&P 500 Index		701.9			20.6			7.0			6.3
Small-Cap Fund (2/21/89 IPO)		848.4			31.3			10.8			3.2
Inflation plus 10%		850.7			12.7			7.5			3.8
Russell 2000 Index		595.7			16.4			6.5			4.4
International Fund (10/26/98 IPO)		273.2			29.8			15.0			8.8
Inflation plus 10%		187.8			12.7			7.5			3.8
EAFE Index*		108.2			27.0			10.7			6.4

*  In 1998, the EAFE was available at month-end only; therefore, the EAFE value at 10/31/98 was used to calculate performance since inception. Additional performance information for each Fund can be found on pages 8, 16, and 22.

Strong performance in markets around the world over the last 18+ months has left few businesses that meet our qualitative and quantitative criteria. In the second quarter we purchased two new holdings, one in Small-Cap and one in International. We sold two International Fund positions, Renault and NTT DoCoMo. In spite of solid value growth across most portfolio companies, the double-digit price appreciation has increased the price-to-value ratio (P/V) of each Fund in 2007.

Much of the investing world’s attention has turned to private equity activity given the metrics, magnitude, and pace of deals. On numerous occasions we have been asked two questions about this phenomenon.

Question 1: Is the explosion in private equity transactions making it harder to find undervalued investments for the Longleaf Funds? Indeed, given the increasing multiples being paid for deals, many public companies are trading at or near fair value in anticipation of more buyouts at full prices.

1

Longleaf Partners Funds

LETTER TO SHAREHOLDERS

Question 2: Should investors reallocate, reducing public equity exposure and raising private equity assets? No. Due to the structural differences between the Longleaf Funds and most private equity funds, the multiples being paid, and the leverage being employed, we believe that today’s private equity deals carry significant risk with lower long-term return opportunity than Longleaf. Below is a comparison highlighting the benefits of owning Longleaf Partners Fund versus the average private equity buyout fund.

		Characteristics of Private
Benefits of Longleaf®	Longleaf Partners Fund Characteristics	Equity Buyout Funds
Higher long-term returns without leverage	5 year return through 12/31/06 = 10.8% 10 year return through 12/31/06 = 12.8%	5 year return through 12/31/06 = 10.5% 10 year return through 12/31/06 = 8.5%
Lower risk appetite	Large margin of safety of price paid versus value. No debt at the Fund level.	Recent prices paid reflect full values. Highly leveraged.
Adequately diversified	18-20 investments.	Can be only 3-4 holdings.
Instant liquidity for shareholders	Daily valuation and access to capital.	Infrequent valuation; capital tied up for as much as 10 years.
Investor interests aligned with managers	Manager and affiliates are largest shareholder group, and Funds are sole equity vehicle.	General partners typically invest 3-6% of the equity in a deal, diluted by extensive leverage.
Fees are significantly lower	Total expense ratio is 0.89%. No performance fees.	Fees are typically 2% of assets plus 20% of performance, plus significant transaction fees to GP, lawyers, bankers and accountants.
Can monetize investments with broader choices and more flexible time period	Without time constraints can trade shares in stock market, sell to private equity or strategic buyer, recapitalize, or sell to investee companies.	Must act within life of fund to IPO, sell to a private or strategic buyer, or recapitalize.

2

Longleaf Partners Funds

LETTER TO SHAREHOLDERS

		Characteristics of Private
Benefits of Longleaf®	Longleaf Partners Fund Characteristics	Equity Buyout Funds
Invest only on our terms	If good businesses with good managements are not selling for less than 60% of value, we patiently wait.	Incentive to invest capital regardless of price because of limited fund life and fee structure.
Financial flexibility and borrowing power of portfolio companies	Financial strength allows companies to seize opportunities and endure difficulties.	Extreme leverage leaves little room for error or opportunity.

Average annual total returns for Longleaf Partners Fund for the one, five and ten year periods ended 6/30/07 are 23.30%, 13.38%, and 12.34%. Fund returns include reinvested dividends and distributions, but do not reflect the deduction of taxes. Current performance may be lower or higher than the performance quoted. Past performance does not guarantee future results, fund prices fluctuate, and the value of an investment at redemption may be worth more or less than the purchase price. Please call 1-800-445-9469 or visit www.longleafpartners.com for current performance information, or a copy of the Prospectus, which should be read carefully before investing to learn about the investment objectives, risks, charges and expenses of the Longleaf Partners Funds. Private Equity Buyout Fund performance is sourced from Thomson Financial Venture Economics and includes U.S. small, medium, large and mega private equity buyout funds’ returns through 12/31/06. Other Private Equity Buyout Fund characteristics are based on Southeastern’s industry knowledge and are intended to illustrate fundamental differences in approach between Southeastern and a private equity investment strategy. Not all private equity funds will have these characteristics, including those with performance reflected in the returns quoted.

Private equity risks have grown. Today’s environment reminds us of the truism, “If it can’t get better, it won’t.”

•  Historically low interest rates have benefited borrowers.

•  Global economic activity has been consistently strong.

•  Lenders have been ravenous to make loans.

•  Growing appetites for securitization (e.g. CDOs and CLOs) have added to the borrowing binge.

Recession, rising interest rates, tightened credit standards, terrorism, and trade wars could each or all destroy the outcome of recent deals because of the full

3

Longleaf Partners Funds

LETTER TO SHAREHOLDERS

prices being paid and the extreme leverage being employed. Remember, private equity is today’s euphemism for leveraged buyout (LBO). Over the last ten years global LBO volume has exploded, going from $17 billion in 1996 to $680 billion in 2006, and is on track to be higher in 2007. Increased capital flow and rapacious incentives have pushed private equity firms to chase deals that most would not have considered historically. Buying a great business franchise during depressed times at 6-7X operating cash flow with a modicum of debt makes sense. Purchasing a mediocre company in good times at 14X operating cash flow using massive leverage defies Ben Graham’s definition of an investment — one that promises safety of principal and an adequate return. Parsimony and investment profits are highly correlated. The cheaper the price paid for an investment, the higher the return and the lower the risk, regardless of the vehicle used (i.e. mutual fund or private equity fund.) Paying full prices with full leverage jeopardizes all capital commitments.

Given the frenzied number of deals being done at high multiples with maximum leverage, some will not work out. The Longleaf Funds derive strength from being a liquidity provider, and our discipline and flexibility give us an advantage, particularly in extreme environments. When LBOs start to unravel, Longleaf intends to be ready to provide capital to pressured equity offerings and/or for distressed debt purchases as we did in the case of Level 3. We are well prepared. First, all three Funds currently have approximately two or three positions of cash available, and a few names are trading close enough to appraisal to sell if a significantly more attractive alternative emerges. Second, the employees of Southeastern are the largest shareholder group in the Funds and will personally be adding cash. Third, we have loyal, sophisticated shareholder partners who overwhelmingly respond when we indicate that additional cash would benefit the Funds’ owners. Fourth, the companies we own can be expected to use their strong balance sheets to provide liquidity to others and/or to buy in their own shares at attractive discounts. Fifth, if the first four measures do not exhaust the opportunity set, we can reopen the Partners and Small-Cap Funds to generate more buying power in the case of U.S. businesses.

Currently optimism is dominating markets. We are finding little to do in the U.S., and only slightly more overseas. We know, however, that eventually the fear and greed pendulum will swing the other way. In the meantime, we are happy to own companies that are strongly financed, competitively entrenched, and managed by capable corporate partners. Values are growing and many companies are buying in their discounted shares aggressively, adding to intrinsic worth. The long-term prospects for real, absolute returns of 10% are good.

4

Longleaf Partners Funds

LETTER TO SHAREHOLDERS

We thought shareholders might enjoy the enclosed article that appeared on Kiplinger.com in May. It provides a good summary of Southeastern’s approach in managing Longleaf Partners Funds.

Sincerely,

O. Mason Hawkins, CFA Chairman & CEO Southeastern Asset Management, Inc.	G. Staley Cates, CFA President Southeastern Asset Management, Inc.

P.S. This report reflects the first six months of 2007. Subsequent to writing this Shareholder Letter and the Management Discussion of each Fund on July 18^th, the stock market has become more volatile and credit markets have tightened. As this report goes to the printer in early August, our “on-deck” list of names that qualify as investment opportunities has increased in each Fund. The price-to-value ratios have become slightly more attractive. Volatility is the friend of investors who know what their companies are worth. We hope to have much more to report by the end of the third quarter.

5

Partners Fund

MANAGEMENT DISCUSSION

Longleaf Partners Fund gained 8.1% in the second quarter, bringing 2007 performance to 10.5%. These recent returns along with the Fund’s 23.3% rise over the last year significantly outperformed our absolute annual return goal of inflation plus 10% as well as the S&P 500 Index. More importantly, over the two decades since inception, the cumulative returns of the Fund have not only exceeded our absolute goal, but have more than doubled the return of the S&P 500 Index.

	Cumulative Total Returns at June 30, 2007
	Since
	Inception						Year-to-			2nd
	4/8/87			1 Year			Date			Quarter
Partners Fund		1,435.3	%		23.3	%		10.5	%		8.1	%
Inflation plus 10%		1,115.0			12.7			7.5			3.8
S&P 500 Index		701.9			20.6			7.0			6.3

Please see page 8 for additional performance information.

Most holdings have aided 2007 returns with over half of the stocks up 10% or more. Dell, the Fund’s largest position, gained 23% in the second quarter, making it the largest contributor to performance by a wide margin both for the quarter and for the year-to-date. Michael Dell returned to the CEO role early in the year and has added several strong members to the executive team. Results announced at the end of May were significantly better than Wall Street expected, due in part to stronger pricing and double-digit growth in Europe and storage products. In addition the company announced that headcount would be reduced by 10%. Dell began addressing concerns about the consumer market, which represents only 15% of revenues, by exploring alternative distribution channels and introducing new designs. While our appraisal has remained stable, sentiment has begun to improve, thus driving the stock’s appreciation.

General Motors was also up 23% in the quarter, making it among the largest year-to-date contributors as well. Overseas growth has outpaced expectations, and Cerberus’ agreement to purchase Chrysler has helped the market put a more realistic value on GM’s North American business. In addition, labor issues have settled down at Delphi, easing concerns of disruption to GM’s parts supply. Aon, which continues to gain share and has ample opportunity for margin expansion, has risen over 20% this year. Chesapeake Energy has had a meaningful impact on performance, although the stock remains well below our appraisal of its long-term natural gas reserves.

6

Partners Fund

MANAGEMENT DISCUSSION

DIRECTV rebounded a bit during the last three months from its first quarter retreat. Even so, its 7% year-to-date decline makes it the only noteworthy detractor in 2007. During the second quarter both Liberty Interactive and Level 3 fell slightly following gains in the first quarter and in 2006. The fundamentals and long-term outlook for all three of these companies remain positive, and our appraisal of each is growing.

Very little activity has occurred in the portfolio during the year. We have been unable to find a new qualifying investment, although we have added to a few existing names. Stock prices have risen, but nothing has been sold due largely to the value growth at most of the Fund’s holdings. In the second quarter Disney spun out its ABC radio network and stations and merged these with Citadel Broadcasting, which we did not keep.

The Fund has 6.7% cash. We are diligently looking for opportunities, but finding little of interest because prices are not sufficiently discounted. The Fund’s price-to-value ratio has risen this year to the low-70%s. While higher than the long-term average, we believe our appraisals are particularly conservative given the multiples being paid for companies in buyout transactions, the relatively high discount rates we use in our free cash flow valuations, and the meaningful opportunities for value growth at a number of the Fund’s holdings.

Please see postscript on page 5 regarding recent volatility.

7

Partners Fund -

PERFORMANCE HISTORY

AVERAGE ANNUAL RETURNS

for the periods ended June 30, 2007

	Partners			Inflation			S&P 500
	Fund			Plus 10%			Index
Year-to-Date		10.47	%		7.46	%		6.96	%
One Year		23.30			12.69			20.59
Five Years		13.38			12.98			10.70
Ten Years		12.34			12.66			7.13
Since Public Offering 4/8/87		14.45			13.13			10.83

Past performance does not predict future performance, Fund prices fluctuate, and the value of an investment at redemption may be worth more or less than the purchase price. The Fund’s performance results in the table shown above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The S&P 500 Index is shown with all dividends and distributions reinvested. This index is unmanaged and is not hedged for foreign currency risk. Longleaf often hedges its exposure to foreign currencies. The U.S. Bureau of Labor Statistics compiles the monthly CPI-U values used to calculate inflation. Seasonally adjusted inflation data is presented for periods less than one year. Current performance may be lower or higher than the performance quoted. Please call 1-800-445-9469 or view Longleaf’s website (www.longleafpartners.com) for more current performance information.

8

Partners Fund –

PORTFOLIO SUMMARY

TABLE OF PORTFOLIO HOLDINGS

at June 30, 2007

			Net
			Assets
Common Stock				93.0	%
	Dell Inc.	9.9
	Level 3 Communications, Inc.	7.3
	Aon Corporation	5.1
	Chesapeake Energy Corporation	5.0
	Yum! Brands, Inc.	5.0
	Cemex S.A.B. de C.V. ADS	4.7
	Koninklijke Philips Electronics N.V.	4.7
	The NipponKoa Insurance Company, Ltd.	4.7
	Sprint Nextel Corporation	4.5
	Liberty Media Holding Corporation – Capital	4.5
	General Motors Corporation	4.4
	The Walt Disney Corporation	4.3
	The DIRECTV Group, Inc.	4.3
	Liberty Media Holding Corporation – Interactive	4.1
	FedEx Corporation	3.6
	Vivendi Universal, S.A.	3.6
	Pioneer Natural Resources Company	3.5
	Telephone and Data Systems, Inc.	3.4
	eBay, Inc.	2.4
	Comcast Corporation	2.2
	Symantec Corporation	1.0
	Discovery Holding Company	0.8
Cash Reserves				6.7
Other Assets and Liabilities, net				0.3
				100.0	%

PORTFOLIO CHANGES

January 1, 2007 through June 30, 2007

New Holdings		Eliminations
Citadel Broadcasting Corporation		Cemex S.A.B. de C.V.(b)
	(The Walt Disney Corporation)(a)	Citadel Broadcasting Corporation
		Level 3 Communications, Inc. 10%   Convertible Senior Notes due 5-1-11(c)

(a)	Change due to corporate action (name of related holding).
(b)	Exchanged for ADS shares
(c)	Exchanged for Level 3 Common Stock

9

Partners Fund -

PORTFOLIO OF INVESTMENTS

at June 30, 2007 (Unaudited)

	Shares				Value
Common Stock 93.0%
				Automobiles 4.4%
		14,240,000		General Motors Corporation	$	538,272,000
				Broadcasting and Cable 6.5%
		9,691,531	*	Comcast Corporation – Class A Special		270,975,207
		22,810,900	*	The DIRECTV Group, Inc.		527,159,899
						798,135,106
				Construction Materials 4.7%
		15,807,233		Cemex S.A.B. de C.V. ADS (Foreign)		583,286,898
				Entertainment 9.6%
		4,335,344	*	Discovery Holding Company – Class A		99,669,558
		4,648,976	*	Liberty Media Holding Corporation – Capital Series A		547,091,495
		15,489,800		The Walt Disney Corporation		528,821,772
						1,175,582,825
				Insurance Brokerage 5.1%
		14,627,000		Aon Corporation		623,256,470
				Internet and Catalog Retail 4.1%
		22,584,666	*	Liberty Media Holding Corporation – Interactive Series A		504,315,592
				Internet Services 2.4%
		9,171,050	*	eBay, Inc.		295,124,389
				Multi-Industry 3.6%
		10,152,570		Vivendi Universal, S.A. (Foreign)(c)		438,447,028
				Natural Resources 8.5%
		17,856,200		Chesapeake Energy Corporation		617,824,520
		8,784,400		Pioneer Natural Resources Company(b)		427,888,124
						1,045,712,644
				Property & Casualty Insurance 4.7%
		63,701,000		The NipponKoa Insurance Company, Ltd. (Foreign)(b)(c)		574,279,066
				Restaurants 5.0%
		18,738,200		Yum! Brands, Inc.		613,113,904
				Software 1.0%
		6,314,800	*	Symantec Corporation		127,558,960

See Notes to Financial Statements.

10

Partners Fund - PORTFOLIO OF INVESTMENTS

at June 30, 2007 (Unaudited)

Shares				Value
			Technology 14.6%
	42,797,779	*	Dell Inc.	$	1,221,876,590
	11,806,035		Koninklijke (Royal) Philips Electronics N.V. (Foreign)		504,261,016
	1,787,165		Koninklijke (Royal) Philips Electronics N.V. ADR (Foreign)		75,632,823
					1,801,770,429
			Telecommunications 15.2%
	153,597,754	*	Level 3 Communications, Inc.(b)		898,546,861
	26,817,900		Sprint Nextel Corporation		555,398,709
	1,530,800		Telephone and Data Systems, Inc.		95,782,156
	5,666,200		Telephone and Data Systems, Inc. – Special		326,089,810
					1,875,817,536
			Transportation 3.6%
	3,998,600		FedEx Corporation(c)		443,724,642
			Total Common Stocks (Cost $7,265,358,226)		11,438,397,489

	Principal
	Amount
	Short-Term Obligations 6.7%
		529,622,000	Repurchase Agreement with State Street Bank, 4.65% due 7/02/07, Repurchase price $529,827,229 (Collateralized by U.S. government securities)				529,622,000
		300,000,000	U.S. Treasury Bills, 4.68% – 4.70% due 8-9-07 to 8-16-07				298,419,833
			Total Short-Term Obligations				828,041,833
Total Investments (Cost $8,093,400,059)(a)				99.7	%		12,266,439,322
Other Assets and Liabilities, Net				0.3			30,236,839
Net Assets				100.0	%	$	12,296,676,161
Net asset value per share							$38.51

*  Non-income producing security.

(a)	Aggregate cost for federal income tax purposes is $8,114,360,595. Net unrealized appreciation of $4,173,039,263 consists of unrealized appreciation and depreciation of $4,320,927,246 and $(147,887,983), respectively.
(b)	Affiliated issuer. See Note 7.
(c)	All or a portion designated as collateral. See Note 8.

Note:  Companies designated as “Foreign” are headquartered outside the U.S. and represent 18% of net assets.

See Notes to Financial Statements.

11

Partners Fund - PORTFOLIO OF INVESTMENTS

at June 30, 2007 (Unaudited)

OPEN FORWARD CURRENCY CONTRACTS

Currency		Currency Sold and	Currency		Unrealized
Units Sold		Settlement Date	Market Value		Gain (Loss)
	250,000,000	Euro 12-18-07	$	340,072,204	$	(1,684,704	)
	35,355,073,000	Japanese Yen 9-7-07		289,731,243		17,446,374
	8,600,000,000	Japanese Yen 11-1-07		70,958,767		1,395,262
	27,007,841,000	Japanese Yen 12-18-07		224,193,928		(669,045	)
			$	924,956,142	$	16,487,887

See Notes to Financial Statements.

12

Intentionally Left Blank

13

Small-Cap Fund

MANAGEMENT DISCUSSION

Longleaf Partners Small-Cap Fund gained 3.2% in the second quarter, bringing year-to-date performance to 10.8%. Thus far in 2007 the Fund is significantly ahead of our annual goal of inflation plus 10% and the Russell 2000 Index. Results over the last twelve months have been spectacular, but are not likely sustainable. We believe the Fund’s longer term performance, which has exceeded our absolute return goal, is more indicative of what shareholders might expect over the next five years. The cumulative returns show that outpacing a real return of 10% leads to significant compounding over long periods.

	Cumulative Total Returns at June 30, 2007
													Year-to			2nd
	15 Year			10 Year			5 Year			1 Year			Date			Quarter
Small-Cap Fund		810.3	%		266.2	%		124.8	%		31.3	%		10.8	%		3.2	%
Inflation plus 10%		499.1			229.3			84.1			12.7			7.5			3.8
Russell 2000 Index		441.7			138.0			91.5			16.4			6.5			4.4

Please see page 16 for additional performance information.

Most names in the portfolio have risen this year, but gains at Discovery and Olympus contributed significantly both in the second quarter and year-to-date. Discovery rose 20% over the last three months, and has appreciated over 40% in 2007. No specific news occurred in the quarter, but new management has intensified the company’s focus on its core programming strengths. Our appraisal has grown and the company still sells below fair value. Olympus has successfully turned around its camera business while reporting better than expected growth in its core medical equipment business. Texas Industries has also been a strong contributor to this year’s Small-Cap Fund results with much of its rise occurring in the first quarter. Business remains strong and multiples being paid in transactions for similar companies imply a higher private market value than the current price.

Fairfax fell 15% in the second quarter, probably as a result of general industry concerns over the performance of bond portfolios as interest rates rose. Our appraisal has risen this year due to Fairfax’s investment and operating successes. IDT continued the decline that began in the first quarter and is the only name that has meaningfully detracted from year-to-date Fund performance. While pricing in the long distance calling card business is fiercely competitive, the net cash position and smart, vested management team give us confidence in our appraisal, which is significantly above the current price.

We have found several interesting small-cap ideas, but only one met our price criteria in the quarter. We purchased the Washington Post, which Southeastern

14

Small-Cap Fund

MANAGEMENT DISCUSSION

has previously owned. We have confidence that partnering with Don Graham again will yield another successful outcome.

The Fund’s price-to-value ratio remains in the high-70%s. The cash position will allow us to lower the P/V as we find opportunities that meet our qualitative and quantitative criteria.

Please see postscript on page 5 regarding recent volatility.

15

Small-Cap Fund -

PERFORMANCE HISTORY

AVERAGE ANNUAL RETURNS

for the periods ended June 30, 2007

	Small-Cap			Inflation			Russell 2000
	Fund			Plus 10%			Index
Year-to-Date		10.82	%		7.46	%		6.45	%
One Year		31.29			12.69			16.44
Five Years		17.59			12.98			13.88
Ten Years		13.86			12.66			9.06
Since Public Offering 2/21/89		13.03			13.05			11.14

Past performance does not predict future performance, Fund prices fluctuate, and the value of an investment at redemption may be worth more or less than the purchase price. The Fund’s performance results in the table shown above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The Russell 2000 Index is shown with all dividends and distributions reinvested. This index is unmanaged and is not hedged for foreign currency risk. Longleaf often hedges its exposure to foreign currencies. The U.S. Bureau of Labor Statistics compiles the monthly CPI-U values used to calculate inflation. Seasonally adjusted inflation data is presented for periods less than one year. Current performance may be lower or higher than the performance quoted. Please call 1-800-445-9469 or view Longleaf’s website (www.longleafpartners.com) for more current performance information.

16

Small-Cap Fund -

PORTFOLIO SUMMARY

TABLE OF PORTFOLIO HOLDINGS

at June 30, 2007

			Net
			Assets
Common Stock				85.9	%
	Discovery Holding Company	7.3
	Level 3 Communications, Inc.	7.2
	Texas Industries, Inc.	6.5
	Olympus Corporation	6.2
	Service Corporation International	5.5
	Pioneer Natural Resources Company	5.0
	Fairfax Financial Holdings Limited	4.3
	IHOP Corp.	4.2
	Del Monte Foods Company	4.1
	Potlatch Corporation	4.1
	Everest Re Group, Ltd.	4.0
	Hilb, Rogal & Hobbs Company	3.9
	Ruddick Corporation	3.7
	Wendy’s International, Inc.	3.4
	The Washington Post Company	3.1
	Willis Group Holdings Limited	2.8
	IDT Corporation	2.8
	PepsiAmericas, Inc.	2.0
	Fair Isaac Corporation	2.0
	Worthington Industries, Inc.	1.5
	Trend Micro Incorporated	1.4
	Odyssey Re Holdings Corp.	0.9
Cash Reserves				14.0
Other Assets and Liabilities, net				0.1
					��
				100.0	%

PORTFOLIO CHANGES

January 1, 2007 through June 30, 2007

New Holdings	Eliminations
Trend Micro Incorporated The Washington Post Company Worthington Industries, Inc.	Jacuzzi Brands, Inc. Vail Resorts, Inc.

17

Small-Cap Fund -

PORTFOLIO OF INVESTMENTS

at June 30, 2007 (Unaudited)

	Shares				Value
Common Stock 85.9%
				Beverages 2.0%
		3,111,700		PepsiAmericas, Inc.	$	76,423,352
				Construction Materials 6.5%
		3,244,800		Texas Industries, Inc.(b)		254,424,768
				Entertainment 7.3%
		12,422,000	*	Discovery Holding Company – Class A		285,581,780
				Food 4.1%
		13,173,806		Del Monte Foods Company(b)		160,193,481
				Funeral Services 5.5%
		16,719,400		Service Corporation International(b)		213,673,932
				Grocery – Retail 3.7%
		4,823,500		Ruddick Corporation(b)		145,283,820
				Information Technology 2.0%
		1,902,400		Fair Isaac Corporation		76,324,288
				Insurance Brokerage 6.7%
		3,526,400		Hilb Rogal & Hobbs Company(b)		151,141,504
		2,513,000		Willis Group Holdings Limited (Foreign)		110,722,780
						261,864,284
				Manufacturing 1.5%
		2,658,700		Worthington Industries, Inc.		57,560,855
				Medical and Photo Equipment 6.2%
		6,149,000		Olympus Corporation (Foreign)		240,216,771
				Natural Resources 9.1%
		4,004,300		Pioneer Natural Resources Company		195,049,453
		3,702,022		Potlatch Corporation(b)		159,372,047
						354,421,500
				Property & Casualty Insurance 9.2%
		1,421,800		Everest Re Group, Ltd. (Foreign)		154,464,352
		886,000		Fairfax Financial Holdings Limited (Foreign)		169,249,038
		843,800		Odyssey Re Holdings Corp.		36,190,582
						359,903,972

See Notes to Financial Statements.

18

Small-Cap Fund - PORTFOLIO OF INVESTMENTS

at June 30, 2007 (Unaudited)

Shares				Value
			Publishing 3.1%
	157,263		The Washington Post Company	$	122,050,242
			Restaurants 7.6%
	2,978,100		IHOP Corp.(b)		162,097,983
	3,663,800		Wendy’s International, Inc.		134,644,650
					296,742,633
			Software 1.4%
	1,723,000		Trend Micro Incorporated (Foreign)		55,695,756
			Telecommunications 10.0%
	459,400		IDT Corporation		4,616,970
	10,133,310		IDT Corporation – Class B		104,575,759
	48,076,002	*	Level 3 Communications, Inc.		281,244,612
					390,437,341
			Total Common Stocks (Cost $2,343,272,772)		3,350,798,775

	Principal
	Amount
Short-Term Obligations 14.0%
		97,235,000	Repurchase Agreement with State Street Bank, 4.65% due 7-2-07, Repurchase price $97,272,679 (Collateralized by U.S. government securities)				97,235,000
		450,000,000	U.S. Treasury Bills, 4.74% - 5.00% due 7-12-07 to 9-6-07				447,551,194
			Total Short-Term Obligations				544,786,194
Total Investments (Cost $2,888,058,966)(a)				99.9	%		3,895,584,969
Other Assets and Liabilities, Net				0.1	%		6,205,805
Net Assets				100.0	%	$	3,901,790,774
Net asset value per share							$33.38

*  Non-income producing security.

(a)	Aggregate cost for federal tax purposes is $2,888,378,935. Net unrealized appreciation of $1,007,526,003 consists of unrealized appreciation and depreciation of $1,035,488,850 and $(27,962,847), respectively.
(b)	Affiliated issuer See Note 7.

Note:  Companies designated as “Foreign” are headquartered outside the U.S. and represent 19% of net assets.

See Notes to Financial Statements.

19

International Fund

MANAGEMENT DISCUSSION

Longleaf Partners International Fund gained 15.0% year-to-date compared to a 10.7% gain for the MSCI EAFE index. The Fund gained 8.8% compared to 6.4% for the Index during the second quarter. For both periods and over the long term, the International Fund has far exceeded our absolute annual goal of inflation plus 10%.

	Cumulative Total Returns at June 30, 2007
	Since
	Inception						Year-to-			2nd
	10/26/98			1 Year			Date			Quarter
International Fund		273.2	%		29.8	%		15.0	%		8.8	%
Inflation plus 10%		187.8			12.7			7.5			3.8
EAFE Index		108.2			27.0			10.7			6.4

Please see page 22 for additional performance information.

With the exception of slight pullbacks at Fairfax and Sankyo and a minor decline in News Corp, all names advanced in the first half. The largest contributor was Ingersoll-Rand, followed by EnCana, Olympus, and Dell. Ingersoll’s CEO Herbert Henkel has already proven himself one of our most capable partners, despite the Fund’s holding period of less than one year. He has improved margins at core businesses while selling non-core businesses at prices above our appraisal. With these proceeds he has aggressively repurchased shares. We have seen no better example by management of pulling all available levers to enhance shareholder value per share. EnCana’s price has risen with oil prices, but the strategic value of its unconventional, long-term oil and gas reserves remains unappreciated by the market. Olympus has successfully turned around its camera business while reporting better than expected growth in its core medical equipment business.

The top performers in the half also led performance in the quarter, though in a different order. Dell contributed most gaining 23%. Michael Dell returned to the CEO role early in the year and has added several strong members to the executive team. Results announced at the end of May were significantly better than Wall Street expected, due in part to stronger pricing and double-digit growth in Europe and storage products. In addition the company announced that headcount would be reduced by 10%. Dell began addressing concerns about the consumer market, which represents only 15% of revenues, by exploring alternative distribution channels and introducing new designs. While our appraisal has remained stable, sentiment has begun to improve, thus driving the stock’s appreciation.

Over the last three months, most names advanced. Of those that declined, Fairfax fell most, probably as a result of general industry concerns over the performance

20

International Fund

MANAGEMENT DISCUSSION

of bond portfolios as interest rates rose. Our appraisal of Fairfax was not affected. Nikko Cordial also declined after the Citigroup tender offer expired. KDDI dropped as a result of a short-term loss of share in net cellular subscriber adds, a number that does not directly impact our appraisal, but frequently influences market sentiment.

As mentioned in the first quarter letter, we sold News Corp early in the year. In the second quarter, we sold Renault as it approached our appraisal after almost tripling our investment over seven years. Renault illustrates Ben Graham’s teaching that, at the right price, any stock can be a good investment, while also highlighting the importance of good partners. We have no affinity for the automotive business, but our entry price allowed us to buy an admittedly average auto business for a stunning price of less than zero. As part of the bargain, we received the now widely recognized operational genius of Carlos Ghosn, who turned Renault’s investment in Nissan into a home run, and the still unrecognized capital allocation skills of Louis Schweitzer, who made the original Nissan investment while swapping Renault’s sub-scale Mack truck business for a valuable piece of Volvo. Today, the same analysts who argued that Renault should always trade at a conglomerate discount trumpet the value of the holding company structure and give full credit for a complicated Renault turnaround in the face of a deteriorating macro environment. We fervently hope that we can again partner with Carlos Ghosn, but are happy to part with Renault at our exit price, particularly when we can reinvest the proceeds at a more attractive price-to-value ratio. For the same reason, we also sold NTT DoCoMo. Finally, we bought Japan Petroleum Exploration in the second quarter.

Considering the elevated level of both international markets and the Fund’s price-to-value ratio at the beginning of the year, we are delighted by the first half’s performance which has already exceeded our annual target of inflation plus 10%. We will be surprised if we are able to sustain such a pace over the short term, but, over the long term, we feel very good about the Fund’s position. Our research productivity has continued to increase thanks to the efforts of the analysts introduced at our annual meeting; the P/V is currently in the mid-70%s; we are replacing fully valued equities with cheaper qualifiers; and we have a list of on-deck candidates that will become buys if and when their prices weaken. Finally, and perhaps most important, we believe that the financial and business strengths of our existing holdings will become more apparent as the credit-fueled tide that has driven most global markets to new highs begins to recede.

Please see postscript on page 5 regrading recent volatility.

21

International Fund -

PERFORMANCE HISTORY

AVERAGE ANNUAL RETURNS

for the periods ended June 30, 2007

	International			Inflation			EAFE
	Fund			Plus 10%			Index
Year-to-Date		14.97	%		7.46	%		10.74	%
One Year		29.81			12.69			27.00
Five Years		15.07			12.98			17.73
Since Public Offering 10/26/98		16.38			12.95			8.81

Past performance does not predict future performance, Fund prices fluctuate, and the value of an investment at redemption may be worth more or less than the purchase price. The Fund’s performance results in the table shown above do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The EAFE Index is shown with all dividends and distributions reinvested. In 1998, the EAFE was available at month-end only; therefore, the EAFE value at October 31, 1998 was used to calculate performance since public offering. This index is unmanaged and is not hedged for foreign currency risk. Longleaf often hedges its exposure to foreign currencies. The U.S. Bureau of Labor Statistics compiles the monthly CPI-U values used to calculate inflation. Seasonally adjusted inflation data is presented for periods less than one year. Current performance may be lower or higher than the performance quoted. Please call 1-800-445-9469 or view Longleaf’s website (www.longleafpartners.com) for more current performance information.

22

International Fund -

PORTFOLIO SUMMARY

TABLE OF PORTFOLIO HOLDINGS

at June 30, 2007

			Net
			Assets
Common Stock				90.2	%
	Dell Inc.	8.5
	The NipponKoa Insurance Company, Ltd.	6.8
	Olympus Corporation	6.6
	Ingersoll-Rand Company Limited	5.7
	EnCana Corporation	5.3
	Nikko Cordial Corporation	5.2
	Cemex S.A.B. de C.V. ADS	5.1
	Koninklijke Philips Electronics N.V.	4.7
	Cheung Kong Holdings Limited	4.7
	British Sky Broadcasting Group plc	4.6
	Fairfax Financial Holdings Limited	4.6
	Millea Holdings, Inc.	4.5
	Yum! Brands, Inc.	4.4
	Nestle S.A.	4.4
	Willis Group Holdings Limited	4.1
	Japan Petroleum Exploration Co., Ltd.	4.1
	Vivendi Universal, S.A.	3.4
	KDDI Corporation	3.3
	Sankyo Co., Ltd.	0.2
Cash Reserves				8.5
Other Assets and Liabilities, net				1.3
				100.0	%

PORTFOLIO CHANGES

January 1, 2007 through June 30, 2007

New Holdings	Eliminations
EnCana Corporation Japan Petroleum Exploration Co., Ltd.	The News Corporation NTT DoCoMo, Inc. Renault S.A.

23

International Fund -

PORTFOLIO OF INVESTMENTS

at June 30, 2007 (Unaudited)

	Shares			Value
Common Stock 90.2%
			Broadcasting and Cable 4.6%
		13,762,000	British Sky Broadcasting Group plc (United Kingdom)(b)	$	176,861,044
			Construction Materials 5.1%
		5,313,260	Cemex S.A.B. de C.V. ADS (Mexico)		196,059,294
			Financial Services 5.2%
		15,129,000	Nikko Cordial Corporation (Japan)(b)		197,951,829
			Food 4.4%
		435,000	Nestle S.A. (Switzerland)		165,951,699
			Gaming Machines 0.2%
		152,000	Sankyo Co., Ltd. (Japan)		6,407,147
			Industrial Machinery 5.7%
		3,931,000	Ingersoll-Rand Company Limited (Bermuda)		215,497,420
			Insurance Brokerage 4.1%
		3,586,000	Willis Group Holdings Limited (United Kingdom)		157,999,160
			Medical and Photo Equipment 6.6%
		6,405,000	Olympus Corporation (Japan)(b)		250,217,665
			Multi-Industry 8.1%
		13,723,000	Cheung Kong Holdings Limited (Hong Kong)(b)		179,715,981
		3,004,000	Vivendi Universal, S.A. (France)(b)		129,730,194
					309,446,175
			Natural Resources 9.4%
		3,265,000	EnCana Corporation (Canada)		200,634,250
		2,225,600	Japan Petroleum Exploration Co., Ltd. (Japan)		157,441,429
					358,075,679
			Property & Casualty Insurance 15.9%
		910,000	Fairfax Financial Holdings Limited (Canada)		173,833,662
		4,198,000	Millea Holdings, Inc. (Japan)		172,522,883
		28,556,000	The NipponKoa Insurance Company, Ltd. (Japan)(b)		257,438,863
					603,795,408
			Restaurants 4.4%
		5,116,000	Yum! Brands, Inc. (United States)		167,395,520

See Notes to Financial Statements.

24

International Fund - PORTFOLIO OF INVESTMENTS

at June 30, 2007 (Unaudited)

Shares				Value
			Technology 13.2%
	11,382,751	*	Dell Inc. (United States)	$	324,977,541
	1,365,931		Koninklijke (Royal) Philips Electronics N.V. (Netherlands)		58,341,836
	2,889,269		Koninklijke (Royal) Philips Electronics N.V. ADR (Netherlands)		122,273,864
					505,593,241
			Telecommunications 3.3%
	17,163		KDDI Corporation (Japan)		127,267,566
			Total Common Stocks (Cost $2,177,484,253)		3,438,518,847

	Principal
	Amount
Short-Term Obligations 8.5%
		49,308,000	Repurchase Agreement with State Street Bank, 4.65% due 7/2/07, Repurchase price $49,327,107 (Collateralized by U.S. government securities)				49,308,000
		275,000,000	U.S. Treasury Bills, 4.86% – 5.00% due 7/12/07 to 8/9/07				274,132,896
			Total Short-Term Obligations				323,440,896
Total Investments (Cost $2,500,925,149)(a)				98.7	%		3,761,959,743
Other Assets and Liabilities, Net				1.3			50,151,770
Net Assets				100.0	%	$	3,812,111,513
Net asset value per share							$ 21.74

*  Non-income producing security.

(a)	Also represents aggregate cost for federal income tax purposes. Net unrealized appreciation of $1,261,034,594 consists of unrealized appreciation and depreciation of $1,267,815,485 and $(6,780,891), respectively.
(b)	All or a portion designated as collateral for forward currency contracts. See Note 8.

Note:  Country listed in parenthesis after each company indicates location of headquarters.

See Notes to Financial Statements.

25

International Fund - PORTFOLIO OF INVESTMENTS

at June 30, 2007 (Unaudited)

OPEN FORWARD CURRENCY CONTRACTS

Currency		Currency Sold and	Currency		Unrealized
Units Sold		Settlement Date	Market Value		Gain(Loss)
	5,710,000	British Pound 7-27-07	$	11,462,342	$	(253,783	)
	71,770,000	British Pound 9-20-07		143,942,656		(3,630,870	)
	9,015,000	British Pound 11-1-07		18,061,933		(132,721	)
	74,500,000	Euro 12-18-07		101,341,517		(502,042	)
	6,956,133,000	Japanese Yen 7-27-07		56,701,632		2,004,342
	28,262,763,000	Japanese Yen 9-7-07		231,610,481		12,803,743
	20,446,875,000	Japanese Yen 11-1-07		168,707,564		2,986,505
	40,535,836,000	Japanese Yen 12-18-07		336,490,736		(1,004,164	)
			$	1,068,318,861	$	12,271,010

COUNTRY WEIGHTINGS

	Equity			Net
	Only			Assets
Japan		34.0	%		30.7	%
United States		14.3			12.9
Canada		10.9			9.8
United Kingdom		9.7			8.8
Bermuda		6.3			5.7
Mexico		5.7			5.1
Netherlands		5.3			4.7
Hong Kong		5.2			4.7
Switzerland		4.8			4.4
France		3.8			3.4
		100.0	%		90.2
Cash, other assets and liabilities, net					9.8
					100.0	%

See Notes to Financial Statements.

26

Intentionally Left Blank

27

Longleaf Partners Funds

STATEMENTS OF ASSETS AND LIABILITIES

at June 30, 2007 (Unaudited)

			Partners		Small-Cap		International
			Fund		Fund		Fund
Assets:
Investments:
	Affiliated securities, at market value (cost $842,484,145, $833,289,065 and $0, respectively) (Note 2 and 7)		$	1,900,714,051	$	1,246,187,535	$	–
	Other securities, at market value (cost $7,250,915,914, $2,054,769,901 and $2,500,925,149, respectively) (Note 2)			10,365,725,271		2,649,397,434		3,761,959,743
		Total Investments		12,266,439,322		3,895,584,969		3,761,959,743
Cash				224		63		896
Receivable for:
	Fund shares sold			3,272,965		1,022,325		31,870,647
	Dividends and interest			1,742,420		3,105,177		2,713,004
	Securities sold			27,375,397		9,428,606		8,104,842
	Forward currency contracts (Note 2)			16,487,887		–		12,271,010
	Foreign tax reclaims			–		–		740,729
Prepaid assets				89,933		36,260		51,416
		Total Assets		12,315,408,148		3,909,177,400		3,817,712,287
Liabilities:
Payable for:
	Securities purchased			2,873,250		3,246,580		–
	Fund shares redeemed			6,935,586		1,223,104		744,555
	Investment counsel fee (Note 3)			7,653,783		2,526,766		4,416,255
	Administration fee (Note 4)			1,009,546		325,943		312,204
Other accrued expenses				259,822		64,233		127,760
		Total Liabilities		18,731,987		7,386,626		5,600,774
			$	12,296,676,161	$	3,901,790,774	$	3,812,111,513
Net Assets:
Net assets consist of:
	Paid-in capital		$	7,870,995,746	$	2,678,698,136	$	2,225,495,953
	Undistributed net investment income			35,413,227		18,367,703		11,965,632
	Accumulated net realized gain on investments and foreign currency			200,740,038		197,248,578		301,408,601
	Unrealized gain on investments and foreign currency			4,189,527,150		1,007,476,357		1,273,241,327
		Net Assets	$	12,296,676,161	$	3,901,790,774	$	3,812,111,513
Net asset value per share				$38.51		$33.38		$21.74
Fund shares issued and outstanding				319,319,574		116,879,947		175,335,214

See Notes to Financial Statements.

28

Longleaf Partners Funds

STATEMENTS OF OPERATIONS

for the six-months ended June 30, 2007 (Unaudited)

				Partners			Small-Cap			International
				Fund			Fund			Fund
Investment Income:
Income:
	Dividends from non-affiliates (net of foreign tax withheld of $4,207,276, $453,113 and $2,837,884, respectively)			$	60,235,732		$	11,984,420		$	33,262,832
	Dividends from affiliates (net of foreign tax withheld of $283,716, $0, and $0 respectively) (Note 7)				4,911,342			9,469,840			–
	Interest				21,236,490			13,874,760			6,118,775
			Total income		86,383,564			35,329,020			39,381,607
Expenses:
	Investment counsel fee (Note 3)				43,519,654			14,480,803			24,845,508
	Administration fee (Note 4)				5,736,502			1,864,655			1,739,695
	Transfer agent fees and expenses				1,110,219			334,873			341,911
	Custodian fees and expenses				222,556			21,423			210,058
	Prospectus and shareholder reports				301,130			63,699			76,738
	Trustees’ fees and expenses				157,694			81,327			81,327
	Registration fees				43,627			28,179			26,442
	Professional fees				34,839			35,052			34,841
	Other				120,136			51,306			51,574
			Total expenses		51,246,357			16,961,317			27,408,094
			Net investment income		35,137,207			18,367,703			11,973,513
Realized and unrealized gain:
Net realized gain(loss):
	Non-affiliated securities				124,321,628			57,658,794			185,352,276
	Affiliated securities (Note 7)				–			33,557,899			–
	Forward currency contracts				18,120,885			–			33,886,180
	Foreign currency transactions				(114,157	)		–			(145,585	)
		Net gain			142,328,356			91,216,693			219,092,871
Change in unrealized appreciation (depreciation):
	Securities				967,429,190			269,191,777			255,993,700
	Other assets, liabilities and forwards				6,807,700			(49,647	)		3,741,084
		Change in net unrealized appreciation			974,236,890			269,142,130			259,734,784
		Net realized and unrealized gain			1,116,565,246			360,358,823			478,827,655
Net increase in net assets resulting from operations				$	1,151,702,453		$	378,726,526		$	490,801,168

See Notes to Financial Statements.

29

Longleaf Partners Funds

STATEMENTS OF CHANGES IN NET ASSETS

			Partners Fund
			Six months ended			Year ended
			June 30, 2007			December 31,
			(Unaudited)			2006
Operations:
	Net investment income		$	35,137,207		$	43,421,690
	Net realized gain from investments and foreign currency transactions			142,328,356			720,657,306
	Net change in unrealized appreciation of securities, other assets, liabilities and forwards			974,236,890			1,137,451,009
		Net increase in net assets resulting from operations		1,151,702,453			1,901,530,005
Distributions to shareholders:
	From net investment income			–			(44,536,241	)
	From net realized gain on investments			–			(755,953,511	)
		Net decrease in net assets resulting from distributions		–			(800,489,752	)
Capital share transactions (Note 6):
	Net proceeds from sale of shares			866,526,411			1,396,022,350
	Net asset value of shares issued to shareholders for reinvestment of shareholder distributions			–			730,065,307
	Cost of shares redeemed			(593,146,950	)		(1,134,738,762	)
		Net increase in net assets from fund share transactions		273,379,461			991,348,895
		Total increase in net assets		1,425,081,914			2,092,389,148
Net assets:
	Beginning of period			10,871,594,247			8,779,205,099
	End of period		$	12,296,676,161		$	10,871,594,247
	Undistributed net investment income included in net assets at end of period			$35,413,227			$390,177

See Notes to Financial Statements.

30

Longleaf Partners Funds

STATEMENTS OF CHANGES IN NET ASSETS

Small-Cap Fund						International Fund
Six months ended			Year ended			Six months ended			Year ended
June 30, 2007			December 31,			June 30, 2007			December 31,
(Unaudited)			2006			(Unaudited)			2006
$	18,367,703		$	57,643,900		$	11,973,513		$	2,680,832
	91,216,693			347,988,801			219,092,871			248,650,431
	269,142,130			235,802,008			259,734,784			234,734,825
	378,726,526			641,434,709			490,801,168			486,066,088
	–			(58,705,003	)		–			(2,515,258	)
	–			(251,956,686	)		–			(221,996,422	)
	–			(310,661,689	)		–			(224,511,680	)
	238,964,809			391,956,726			297,255,497			458,350,467
	–			283,662,236			–			206,854,594
	(163,185,186	)		(371,649,902	)		(230,483,065	)		(552,951,103	)
	75,779,623			303,969,060			66,772,432			112,253,958
	454,506,149			634,742,080			557,573,600			373,808,366
	3,447,284,625			2,812,542,545			3,254,537,913			2,880,729,547
$	3,901,790,774		$	3,447,284,625		$	3,812,111,513		$	3,254,537,913
	$18,367,703			$     –			$11,965,632			$137,704

See Notes to Financial Statements.

31

Longleaf Partners Funds

NOTES TO FINANCIAL STATEMENTS

Note 1. Organization

The Longleaf Partners Fund, Longleaf Partners Small-Cap Fund, and Longleaf Partners International Fund (the “Funds”) are non-diversified and each is a series of Longleaf Partners Funds Trust, a Massachusetts business trust, which is registered as an open-end management investment company under the Investment Company Act of 1940, as amended.

Note 2. Significant Accounting Policies

Management Estimates

The accompanying financial statements are prepared in accordance with accounting principles generally accepted in the United States of America; these principles may require the use of estimates by Fund management. Actual results could differ from those estimates.

Security Valuation

Portfolio securities listed or traded on a securities exchange (U.S. or foreign), on the NASDAQ national market, or any representative quotation system providing same day publication of actual prices, are valued at the last sale price. If there are no transactions in the security that day, securities are valued at the midpoint between the closing bid and ask prices or, if there are no such prices, the prior day’s close.

In the case of bonds and other fixed income securities, valuations may be furnished by a pricing service which takes into account factors in addition to quoted prices (such as trading characteristics, yield, quality, coupon rate, maturity, type of issue, and other market data relating to the priced security or other similar securities) where taking such factors into account would lead to a more accurate reflection of the fair market value of such securities.

When market quotations are not readily available, valuations of portfolio securities may be determined in accordance with procedures established by and under the general supervision of the Funds’ Trustees. In determining fair value, the Board considers all relevant qualitative and quantitative information available including news regarding significant market or security specific events. The Board may also utilize a service provided by an independent third party to assist in fair valuation of certain securities. These factors are subject to change over time and are reviewed periodically. Because the utilization of fair value depends on market activity, the frequency with which fair valuation may be used cannot be predicted. Estimated values may differ from the values that would have been used had a ready market for the investment existed.

32

Repurchase agreements are valued at cost which, combined with accrued interest, approximates market value. Short-term U.S. Government obligations are valued at amortized cost which approximates current market value.

The Funds determine net asset values (“NAVs”) once a day, at the close of regular trading on the New York Stock Exchange (usually at 4:00 p.m. Eastern time) on days the Exchange is open for business. The Exchange is closed for specified national holidays and on weekends. Foreign securities are generally priced at the latest market close in the foreign market, which may be at different times or days than the close of the New York Stock Exchange. If events occur which could materially affect the NAV between the close of the foreign market and normal pricing at the close of the New York Stock Exchange, foreign securities may be fair valued as determined by the Board of Trustees, consistent with any regulatory guidelines.

Accounting for Investments

For financial reporting purposes, the Funds record security transactions on trade date. Realized gains and losses on security transactions are determined using the specific identification method. Dividend income is recognized on the ex-dividend date, except that certain dividends from foreign securities are recorded as soon after the ex-dividend date as the Fund is able to obtain information on the dividend. Interest income and Fund expenses are recognized on an accrual basis.

Distributions to Shareholders

Dividends and distributions to shareholders are recorded on the ex-dividend date.

Federal Income Taxes

The Funds’ policy is to comply with the requirements of the Internal Revenue Code that are applicable to regulated investment companies and to distribute substantially all taxable income to shareholders. Accordingly, no federal income tax provision is required. The Funds intend to make any required distributions to avoid the application of a 4% nondeductible excise tax. Distributions are determined in accordance with income tax regulations which may differ from generally accepted accounting principles. Reclassifications are made within the Funds’ capital accounts to reflect income and gains available for distribution under income tax regulations.

Foreign Currency Translations

The books and records of the Funds are maintained in U.S. dollars. Securities denominated in currencies other than U.S. dollars are subject to changes in value due to fluctuations in exchange rates. Purchases and sales of securities and income and expenses are translated into U.S. dollars at the prevailing exchange rate on the respective date of each transaction. The market values of investment securities, assets and liabilities are translated into U.S. dollars daily.

The Funds do not isolate the portion of net realized and unrealized gains or losses in equity security investments which are attributable to changes in foreign

33

exchange rates. Accordingly, the impact of such changes is included in the realized and unrealized gains or losses on the underlying equity securities.

Forward Currency Contracts

Forward currency contracts are commitments to purchase or sell a foreign currency at a future maturity date. The resulting obligation is marked-to-market daily using foreign currency exchange rates supplied by an independent pricing service. An unrealized gain or loss is recorded for the difference between the contract opening value and its current value. When a contract is closed or delivery is taken, this gain or loss is realized. For federal tax purposes, gain or loss on open forward contracts are treated as realized and are subject to distribution at our excise tax year-end date.

Risk of Forward Currency Contracts

The Funds generally use forward currency contracts for hedging purposes to offset currency exposure in portfolio holdings. Each Fund may seek to hedge foreign currency exposure to the full extent of its investment in foreign securities, but there is no requirement that all foreign securities be hedged. Forward contracts may reduce the potential gain from a positive change in the relationship between the U.S. dollar and foreign currencies or, considered separately, may produce a loss. Where a liquid secondary market for forwards does not exist, the Funds may not be able to close their positions and in such an event, the loss is theoretically unlimited.

Repurchase Agreements

The Funds may engage in repurchase agreement transactions. The Funds’ custodian bank sells U.S. government or agency securities to each Fund under agreements to repurchase these securities at a stated repurchase price including interest for the term of the agreement, which is usually overnight or over a weekend. Each Fund, through its custodian, receives delivery of the underlying U.S. government or agency securities as collateral, whose market value is required to be at least equal to the repurchase price. If the custodian becomes bankrupt, the Fund might be delayed, or may incur costs or possible losses of principal and income, in selling the collateral.

New Accounting Pronouncements

On July 13, 2006, the Financial Accounting Standards Board (“FASB”) released FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes” (“FIN 48”). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether the tax positions are “more-likely-than-not” of being sustained by the applicable tax authority. Tax positions not deemed to meet the more-likely-than-not threshold would be recorded as a tax benefit or expense in the current year. Adoption of FIN 48 is

34

required for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. The standard is not expected to materially impact the Funds’ financial statements.

On September 15, 2006, the FASB released Statement of Financial Accounting Standards No. 157 (“FAS 157”) Fair Value Measurements which provides enhanced guidance for using fair value to measure assets and liabilities. The standard requires companies to provide expanded information about the assets and liabilities measured at fair value and the potential effect of these fair valuations on an entity’s financial performance. The standard does not expand the use of fair value in any new circumstances, but provides clarification on acceptable fair valuation methods and applications. Adoption of FAS 157 is required for fiscal years beginning after November 15, 2007. The standard is not expected to materially impact the Funds’ financial statements.

Note 3. Investment Counsel Agreement

Southeastern Asset Management, Inc. (“Southeastern”) serves as Investment Counsel to the Funds and receives annual compensation, computed daily and paid monthly, in accordance with the following schedule for the Partners Fund and Small-Cap Fund:

First $400 million of average daily net assets	1.00	%
In excess of $400 million	.75	%

For the Partners and Small-Cap Funds, Southeastern has agreed to reduce its fees on a pro rata basis to the extent that each Fund’s normal annual operating expenses (excluding taxes, interest, brokerage fees, and extraordinary expenses) exceed 1.5% of average annual net assets. No such reductions were necessary for the current period.

The International Fund fee is calculated in accordance with the following schedule:

First $2.5 billion of average daily net assets	1.50	%
In excess of $2.5 billion	1.25	%

For this Fund, Southeastern has agreed to reduce its fees on a pro rata basis to the extent that the Fund’s normal annual operating expenses (excluding taxes, interest, brokerage fees, and extraordinary expenses) exceed 1.75% of average annual net assets. No reduction was necessary for the current period.

Note 4. Fund Administrator

Southeastern also serves as the Fund Administrator and in this capacity is responsible for managing, performing or supervising the administrative and business operations of the Funds. Functions include the preparation of all registration statements, prospectuses, proxy statements, daily valuation of the portfolios and calculation of daily net asset values per share. The Funds pay a fee

35

as compensation for these services, accrued daily and paid monthly, of 0.10% per annum of average daily net assets.

Note 5. Investment Transactions

Purchases and sales of equity securities and corporate bonds for the period (excluding short-term obligations) are summarized below:

	Purchases		Sales
Partners Fund	$	354,680,202	$	291,710,253
Small-Cap Fund		270,507,448		300,252,153
International Fund		401,410,497		422,953,827

Note 6. Shares of Beneficial Interest

Each Fund is authorized to issue unlimited shares of beneficial interest with no par value. Transactions in shares of beneficial interest were as follows:

	Six months ended June 30, 2007 (Unaudited)
	Partners			Small-Cap			International
	Fund			Fund			Fund
Shares sold		23,827,254			7,487,391			14,719,784
Reinvestment of shareholder distributions		–			–			–
Shares redeemed		(16,344,345	)		(5,057,991	)		(11,466,260	)
		7,482,909			2,429,400			3,253,524

	Year ended December 31, 2006
	Partners			Small-Cap			International
	Fund			Fund			Fund
Shares sold		41,199,929			13,734,861			25,195,194
Reinvestment of shareholder distributions		21,037,467			9,437,163			11,336,092
Shares redeemed		(33,891,867	)		(12,797,782	)		(30,402,886	)
		28,345,529			10,374,242			6,128,400

36

Note 7. Affiliated Issuer

Under Section 2(a)(3) of the Investment Company Act of 1940, a portfolio company is defined as “affiliated” if a Fund owns five percent or more of its voting stock. Each Fund held at least five percent of the outstanding voting stock of the following companies during the six months ended June 30, 2007:

				Market Value
		Shares at
		June 30,		June 30,		December 31,
		2007		2007		2006
Partners Fund
	Level 3 Communications, Inc.*		153,597,754	$	898,546,861	$	453,762,400
	Level 3 Communications, Inc. 10% Convertible Senior Notes due 5-1-11		–		–		403,628,583
	The NipponKoa Insurance Company, Ltd.		63,701,000		574,279,066		516,545,229
	Pioneer Natural Resources Company		8,784,400		427,888,124		348,652,836
					1,900,714,051		1,722,589,048
Small-Cap Fund
	Del Monte Foods Company		13,173,806		160,193,481		–
	Hilb Rogal & Hobbs Company		3,526,400		151,141,504		148,531,968
	IHOP Corp.		2,978,100		162,097,983		156,945,870
	Jacuzzi Brands, Inc.*		–		–		181,599,814
	Potlatch Corporation		3,702,022		159,372,047		162,222,604
	Ruddick Corporation		4,823,500		145,283,820		133,852,125
	Service Corporation International		16,719,400		213,673,932		171,373,850
	Texas Industries, Inc.		3,244,800		254,424,768		208,413,504
				$	1,246,187,535	$	1,162,939,735

Purchases, sales and income for these affiliates for the six months ended June 30, 2007 were as follows:

								Dividend
								or Interest
		Purchases			Sales			Income(a)
Partners Fund
	Level 3 Communications, Inc.*	$	222,079,000	(b)	$	–		$	–
	Level 3 Communications, Inc. 10% Convertible Senior Notes due 5-1-11		–			222,079,000	(b)		1,048,731	(c)
	The NipponKoa Insurance Company, Ltd.		–			–			3,769,370
	Pioneer Natural Resources Company		–			–			1,141,972
		$	222,079,000		$	222,079,000		$	5,960,073

37

						Dividend
						or Interest
		Purchases		Sales		Income(a)
Small-Cap Fund
	Del Monte Foods Company	$	47,639,506	$	–	$	920,154
	Hilb Rogal & Hobbs Company		–		–		881,600
	IHOP Corp		–		–		1,489,050
	Jacuzzi Brands, Inc.*		–		182,622,500		–
	Potlatch Corporation		–		–		3,627,982
	Ruddick Corporation		–		–		1,061,170
	Service Corporation International		–		–		1,003,164
	Texas Industries, Inc.		–		–		486,720
		$	47,639,506	$	182,622,500	$	9,469,840

*  Non-income producing

(a)	Dividend income unless otherwise noted.
(b)	Senior Notes exchanged for common stock.
(c)	Interest income.

Note 8. Collateral

Securities with the following aggregate value were segregated to collateralize forward currency contracts at June 30, 2007:

Partners Fund	$	1,456,450,736
International Fund		1,191,915,576

Note 9. Related Ownership

At June 30, 2007, officers, employees of Southeastern and their families, Fund trustees, the Southeastern retirement plan and other affiliates owned more than 5% of the following Funds:

	Shares Owned		Percent of Fund
Small-Cap Fund		8,563,442		7.3	%
International Fund		12,065,036		6.9

38

Intentionally Left Blank

39

Longleaf Partners Funds

FINANCIAL HIGHLIGHTS

The presentation is for a share outstanding throughout each period.

							Net
							Gains
		Net					(Losses) on									Distri-
		Asset		Net			Securities			Total			Dividends			butions
		Value		Investment			Realized			From			from Net			from
		Beginning		Income			and			Investment			Investment			Capital
		of Period		(Loss)			Unrealized			Operations			Income			Gains
Partners Fund
Six months ended
	June 30, 2007 (Unaudited)	$	34.86	$	.11		$	3.54		$	3.65		$	–		$	–
Year ended December 31,
	2006		30.97		.14			6.53			6.67			(.14	)		(2.64	)
	2005		31.32		.29			.83			1.12			(.29	)		(1.18	)
	2004		29.98		.07			2.05			2.12			(.15	)		(.63	)
	2003		22.24		.08			7.66			7.74			–			–
	2002		24.51		.04			(2.08	)		(2.04	)		(.04	)		(.14	)
Small-Cap Fund
Six months ended
	June 30, 2007 (Unaudited)		30.12		.16			3.10			3.26			–			–
Year ended December 31,
	2006		27.02		.50			5.49			5.99			(.56	)		(2.33	)
	2005		29.85		.58			2.43			3.01			(.57	)		(5.27	)
	2004		28.81		.42			3.75			4.17			(.43	)		(2.70	)
	2003		20.33		.45			8.47			8.92			(.44	)		–
	2002		21.68		.52			(1.32	)		(0.80	)		(.53	)		(.02	)
International Fund
Six months ended
	June 30, 2007 (Unaudited)		18.91		.01			2.82			2.83			–			–
Year ended December 31,
	2006		17.36		.02			2.89			2.91			(.01	)		(1.35	)
	2005		15.55		(.01	)		2.01			2.00			–			(.19	)
	2004		14.11		(.08	)		1.52			1.44			–			–
	2003		9.97		(.07	)		4.21			4.14			–			–
	2002		12.34		(.06	)		(1.99	)		(2.05	)		–			(.32	)

^(a)  Total return reflects the rate that an investor would have earned on investment in the Fund during each period, assuming reinvestment of all distributions.

^(b)  Expenses presented include dividend expense and brokerage fees for short-sales. The operating expense ratio was 1.69% (Note 3).

40

Longleaf Partners Funds

FINANCIAL HIGHLIGHTS

																Ratio of
													Ratio of			Net
						Net							Expenses			Investment
						Asset					Net Assets		to			Income
Return			Total			Value					End of		Average			(Loss) to			Portfolio
of			Distri-			End of		Total			Period		Net			Average			Turnover
Capital			butions			Period		Return(a)			(thousands)		Assets			Net Assets			Rate
$	–		$	–		$	38.51		10.47	%	$	12,296,676		.89	%		.30	%		2.73	%
	–			(2.78	)		34.86		21.63			10,871,594		.90			.45			18.98
	–			(1.47	)		30.97		3.62			8,779,205		.91			.95			6.64
	–			(.78	)		31.32		7.14			8,999,465		.90			.28			13.38
	–			–			29.98		34.80			7,668,968		.91			.32			7.37
	(.05	)		(.23	)		22.24		(8.34	)		4,787,662		.91			.17			19.57
	–			–			33.38		10.82			3,901,791		.91			.49			8.45
	–			(2.89	)		30.12		22.33			3,447,285		.92			1.87			34.90
	–			(5.84	)		27.02		10.75			2,812,543		.93			2.21			17.28
	–			(3.13	)		29.85		14.78			2,673,843		.93			1.52			31.04
	–			(.44	)		28.81		43.85			2,365,085		.95			1.89			4.44
	–			(.55	)		20.33		(3.74	)		1,677,194		.95			2.43			16.91
	–			–			21.74		14.97			3,812,112		1.58			.34			12.46
	–			(1.36	)		18.91		17.07			3,254,538		1.61			.09			24.30
	–			(.19	)		17.36		12.88			2,880,730		1.64			(.05	)		16.93
	–			–			15.55		10.21			2,579,635		1.66			(.57	)		18.86
	–			–			14.11		41.52			1,923,581		1.68			(.68	)		10.18
	–			(.32	)		9.97		(16.51	)		1,086,714		1.80	(b)		(.68	)		15.86

41

Longleaf Partners Funds

EXPENSE EXAMPLE

Shareholders of mutual funds may incur two types of costs: (1) ongoing costs, including management fees, transfer agent fees, and other fund expenses; and (2) transaction costs, including sale charges (loads) and redemption fees. Longleaf does not charge transaction fees of any sort.

The following examples are intended to show the ongoing costs (in dollars) of investing in the Longleaf Funds and to enable you to compare the costs of investing in other mutual funds. Each example is based on an investment of $1,000 made at December 31, 2006 and held through June 30, 2007.

Actual Expenses

The table below provides information about actual account values and actual expenses using each Fund’s actual return for the period. To estimate the expenses that you paid over the period, divide your account balance by $1,000 (for example, a $12,500 account balance divided by $1,000 = 12.5), then multiply the result by the number in the third line entitled “Expenses Paid During Period.”

Ongoing Expenses and Actual Fund Returns

for the period December 31, 2006 to June 30, 2007

	Partners			Small-Cap			International
Beginning Account Value	$	1,000.00		$	1,000.00		$	1,000.00
Ending Account Value		1,104.70			1,108.25			1,149.65
Expenses Paid During Period*		4.64			4.76			8.42
Annualized Expense Ratio for Period		0.89	%		0.91	%		1.58	%

*  Expenses are equal to the Fund’s annualized expense ratio, multiplied by the average account value for the period, multiplied by the number of days in the most recent fiscal half year (181) divided by 365 days in the current year.

42

Longleaf Partners Funds

EXPENSE EXAMPLE

Hypothetical Example for Comparison Purposes

The table below provides information about hypothetical account values and expenses based on each Fund’s actual expense ratio and assumed returns of 5% per year before expenses, which are not the Funds’ actual returns. Do not use the hypothetical data below to estimate your ending account balance or expenses you paid. This information serves only to compare the ongoing costs of investing in Longleaf with other mutual funds. To do so, examine this 5% hypothetical example against the 5% hypothetical examples found in other funds’ shareholder reports.

The expenses shown in the table highlight only ongoing costs and do not reflect transactional costs that may be charged by other funds. Therefore, the third line of the table does not reveal the total relative costs of owning different funds. Since Longleaf does not charge transactions fees, you should evaluate other funds’ transaction costs to assess the total cost of ownership for comparison purposes.

Ongoing Expenses and Hypothetical 5% Return

for the period December 31, 2006 to June 30, 2007

	Partners			Small-Cap			International
Beginning Account Value	$	1,000.00		$	1,000.00		$	1,000.00
Ending Account Value		1,020.38			1,020.28			1,016.96
Expenses Paid During Period*		4.46			4.56			7.90
Annualized Expense Ratio for Period		0.89	%		0.91	%		1.58	%

*  Expenses are equal to the Fund’s annualized expense ratio, multiplied by the average account value for the period, multiplied by the number of days in the most recent fiscal half year (181) divided by 365 days in the current year.

43

Intentionally Left Blank

44

Longleaf Partners Funds

FUND INFORMATION

The following additional information may be obtained without charge, upon request, by calling 1-800-445-9469, Option 1, or on the Funds’ website at www.longleafpartners.com, or on the SEC’s website at www.sec.gov.

Proxy Voting Policies and Procedures

A description of Longleaf’s Proxy Voting Policies and Procedures is included in the Statement of Additional Information (SAI).

Proxy Voting Record

Information regarding how the Funds voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is contained in Form N-PX.

Quarterly Portfolio Holdings

Longleaf files a complete schedule of portfolio holdings for the first and third quarters of each fiscal year on Form N-Q, which is available on the SEC’s website, and may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. (please call 1-800-SEC-0330 for information on the operation of the Public Reference Room).

In addition to Form N-Q, Longleaf publishes reports for each fiscal quarter. These reports include complete schedules of portfolio holdings, as well as performance updates and management discussion. We furnish Longleaf’s Quarterly Reports in lieu of Form N-Q to shareholders who request information about our first and third quarter portfolio holdings, and Semi-Annual and Annual Reports for requests related to the second and fourth quarters, respectively.

Fund Trustees

Additional information about Fund Trustees is included in the Statement of Additional Information (SAI).

45

Intentionally Left Blank

46

Longleaf Partners Funds

SERVICE DIRECTORY

Contact us at www.longleafpartners.com or

(800) 445-9469

FUND INFORMATION OPTION 1

To request a Prospectus, Statement of Additional Information (including Longleaf’s Proxy Voting Policies and Procedures), financial report, application or other Fund information from 7:00 a.m. to 7:00 p.m. Eastern time, Monday through Friday.

DAILY FUND PRICES OPTION 2

For automated reporting 24 hours a day, seven days a week.

ACCOUNT INFORMATION OPTION 3

For account balance and transaction activity, 24 hours a day, seven days a week. Please have your Fund number (see below) and account number ready to access your investment information.

SHAREHOLDER INQUIRIES OPTION 0

To request action on your existing account from 9:00 a.m. to 6:00 p.m. Eastern time, Monday through Friday.

CORRESPONDENCE

By regular mail:	By express mail or overnight courier:
Longleaf Partners Funds	Longleaf Partners Funds
P.O. Box 9694	c/o PFPC
Providence, RI 02940-9694	101 Sabin Street
	Pawtucket, RI 02860
	(508) 871-8800

PUBLISHED DAILY PRICE QUOTATIONS

Daily net asset value per share of each Fund is reported in mutual fund quotations tables of major newspapers in alphabetical order under the bold heading Longleaf Partners as follows:

			Transfer Agent	Status to
Abbreviation	Symbol	Cusip	Fund Number	New Investors
Partners	LLPFX	543069108	133	Closed 7-16-04
Sm-Cap	LLSCX	543069207	134	Closed 7-31-97
Intl	LLINX	543069405	136	Open

47

Longleaf Partners Funds ^®

c/o PFPC

P.O. Box 9694

Providence, RI 02940-9694

(800) 445-9469

www.longleafpartners.com

Item 2.     Code of Ethics.

Not applicable to semi-annual reports.

Item 3.     Audit Committee Financial Expert.

Not applicable to semi-annual reports.

Item 4.     Principal Accountant Fees and Services.

Not applicable to semi-annual reports.

Item 5.     Audit Committee of Listed Registrants.

Not applicable.

Item 6.     Schedule of Investments

A complete schedule of investments at June 30, 2007 is included in the Semi-Annual Report filed under Part I of this form.

Item 7.     Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

Not applicable.

Item 8.     Portfolio Managers of Closed-End Management Investment Companies.

Not applicable.

Item 9.     Purchase of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers

Not applicable.

Item 10.     Submission of Matters to a Vote of Security Holders

The registrant does not currently have in place procedures by which shareholders may recommend nominees to the registrant’s board of directors.

Item 11.     Controls and Procedures.

The registrant’s principal executive officer and principal financial officer have concluded, based on their evaluation of the effectiveness of the design and operation of the registrant’s disclosure controls and procedures as of a date within 90 days of the filing date of this report on Form N-CSR, that the design and operation of such procedures are effective to provide reasonable assurance that information required to be disclosed by the investment company in the reports that it files or submits under the Securities Exchange Act to 1934 is recorded, processed, summarized, and reported within the time periods specified in the Commission’s rules and forms.
 
At the date of filing this Form N-CSR, the registrant’s principal executive officer and principal financial officer are aware of no changes in the registrant’s internal control over financial reporting during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.

Item 12.     Exhibits.

Exhibit 99. CERT Certification Required by Item 12(a)(2) of Form N-CSR

Exhibit 99.906 CERT Certification Pursuant to Section 906 of the Sarbanes Oxley Act.

SIGNATURES

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

Longleaf Partners Funds Trust

By	/s/ O. Mason Hawkins
	O. Mason Hawkins Trustee Longleaf Partners Funds Trust
Date	August 22, 2007

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

By	/s/ O. Mason Hawkins
	O. Mason Hawkins Chairman and CEO, Southeastern Asset Management, Inc. Functioning as principal executive officer under agreements with Longleaf Partners Funds Trust and its separate series
Date	August 22, 2007
By	/s/ Julie M. Douglas
	Julie M. Douglas Vice President & CFO – Mutual Funds, Southeastern Asset Management, Inc. Functioning as principal financial officer under agreements with Longleaf Partners Funds Trust and its separate series
Date	August 22, 2007

A signed original of this written statement has been provided to Longleaf Partners Funds Trust and will be retained by Longleaf Partners Funds Trust and furnished to the Securities and Exchange Commission or its staff upon request.