Cash Trust Series NCSR Certified annual shareholder report (management investment company)

                                  United States
                       Securities and Exchange Commission
                             Washington, D.C. 20549

                                   Form N-CSR
                         Certified Shareholder Report of
                   Registered Management Investment Companies




                                    811-5843

                      (Investment Company Act File Number)


                             Cash Trust Series, Inc.
         ---------------------------------------------------------------

               (Exact Name of Registrant as Specified in Charter)



                            Federated Investors Funds
                              5800 Corporate Drive
                       Pittsburgh, Pennsylvania 15237-7000


                                 (412) 288-1900
                         (Registrant's Telephone Number)


                           John W. McGonigle, Esquire
                            Federated Investors Tower
                               1001 Liberty Avenue
                       Pittsburgh, Pennsylvania 15222-3779
                     (Name and Address of Agent for Service)
                (Notices should be sent to the Agent for Service)






                        Date of Fiscal Year End: 5/31/06


               Date of Reporting Period: Fiscal year ended 5/31/06
                                         -------------------------








Item 1.     Reports to Stockholders

Federated
World-Class Investment Manager

Government Cash Series

A Portfolio of Cash Trust Series, Inc.

ANNUAL SHAREHOLDER REPORT

May 31, 2006

FINANCIAL HIGHLIGHTS
SHAREHOLDER EXPENSE EXAMPLE
PORTFOLIO OF INVESTMENTS SUMMARY TABLES
PORTFOLIO OF INVESTMENTS
STATEMENT OF ASSETS AND LIABILITIES
STATEMENT OF OPERATIONS
STATEMENT OF CHANGES IN NET ASSETS
NOTES TO FINANCIAL STATEMENTS
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
BOARD OF DIRECTORS AND CORPORATION OFFICERS
EVALUATION AND APPROVAL OF ADVISORY CONTRACT
VOTING PROXIES ON FUND PORTFOLIO SECURITIES
QUARTERLY PORTFOLIO SCHEDULE

Federated Investors 50 Years of Growth & Innovation

Financial Highlights

(For a Share Outstanding Throughout Each Period)

Year Ended May 31	2006	¹	2005		2004		2003		2002
Net Asset Value, Beginning of Period	$1.00		$1.00		$1.00		$1.00		$1.00
Income From Investment Operations:
Net investment income	0.0302		0.0099		0.0006		0.0058		0.0174
Less Distributions:
Distributions from net investment income	(0.0302	)	(0.0099	)	(0.0006	)	(0.0058	)	(0.0174	)
Net Asset Value, End of Period	$1.00		$1.00		$1.00		$1.00		$1.00
Total Return²	3.06	%	0.99	%	0.06	%	0.58	%	1.75	%

Ratios to Average Net Assets:
Net expenses	1.05	%	1.05	%	1.04	%	1.05	%	1.05	%
Net investment income	2.98	%	1.08	%	0.07	%	0.59	%	1.74	%
Expense waiver/reimbursement³	0.05	%	0.02	%	0.07	%	0.04	%	0.01	%
Supplemental Data:
Net assets, end of period (000 omitted)	$487,625		$546,590		$444,087		$590,024		$663,299

1 Beginning with the year ended May 31, 2006, the Fund was audited by Ernst & Young LLP. The previous years were audited by another independent registered public accounting firm.

2 Based on net asset value. Total returns for periods of less than one year, if any, are not annualized.

3 This expense decrease is reflected in both the net expense and the net investment income ratios shown above.

See Notes which are an integral part of the Financial Statements

Shareholder Expense Example

As a shareholder of the Fund, you incur ongoing costs, including management fees; to the extent applicable, distribution (12b-1) fees and/or shareholder services fees; and other Fund expenses. This Example is intended to help you to 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. It is based on an investment of $1,000 invested at the beginning of the period and held for the entire period from December 1, 2005 to May 31, 2006.

ACTUAL EXPENSES

The first section of the table below provides information about actual account values and actual expenses. You may use the information in this section, together with the amount you invested, to estimate the expenses that you incurred over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first section under the heading entitled "Expenses Paid During Period" to estimate the expenses attributable to your investment during this period.

HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES

The second section of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. Thus, you should not use the hypothetical account values and expenses to estimate the actual ending account balance or your expenses for the period. Rather, these figures are provided to enable you to compare the ongoing costs of investing in the Fund with other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only. Therefore, the second section of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.

	Beginning Account Value 12/1/2005	Ending Account Value 5/31/2006	Expenses Paid During Period¹
Actual	$1,000	$1,017.60	$5.33
Hypothetical (assuming a 5% return before expenses)	$1,000	$1,019.65	$5.34

1 Expenses are equal to the Fund's annualized net expense ratio of 1.06%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).

Portfolio of Investments Summary Tables

At May 31, 2006, the Fund's portfolio composition¹ was as follows:

	Percentage of Total Net Assets
Repurchase Agreements	73.9	%
U.S. Government Agency Securities	26.2	%
Other Assets and Liabilities--Net²	(0.1	)%
TOTAL	100.0	%

At May 31, 2006, the Fund's effective maturity³ schedule was as follows:

Securities With an Effective Maturity of:	Percentage of Total Net Assets
1-7 Days	62.9	%
8-30 Days	16.0	%
31-90 Days	13.4	%
91-180 Days	2.9	%
181 Days or more	4.9	%
Other Assets and Liabilities--Net²	(0.1	)%
TOTAL	100.0	%

1 See the Fund's Prospectus for a description of the principal types of securities in which the Fund invests.

2 Assets, other than investments in securities, less liabilities. See Statement of Assets and Liabilities.

3 Effective maturity is determined in accordance with the requirements of Rule 2a-7 under the Investment Company Act of 1940, which regulates money market mutual funds.

Portfolio of Investments

May 31, 2006

Principal Amount				Value
			GOVERNMENT AGENCIES--26.2%
$	36,000,000	¹	Federal Home Loan Bank System Floating Rate Notes, 4.770% - 5.039%, 6/12/2006 - 8/2/2006	$	35,995,870
	17,250,000		Federal Home Loan Bank System Notes, 2.625% - 4.000%, 7/21/2006 - 2/15/2007		17,188,517
	17,663,000	²	Federal Home Loan Mortgage Corp. Discount Notes, 4.190% - 5.005%, 9/29/2006 - 5/1/2007		17,097,095
	37,000,000	¹	Federal Home Loan Mortgage Corp. Floating Rate Notes, 4.775% - 5.010%, 6/19/2006 - 8/7/2006		36,986,700
	17,412,000		Federal Home Loan Mortgage Corp. Notes, 3.500% - 5.500%, 7/15/2006 - 6/18/2007		17,381,121
	3,000,000		Federal National Mortgage Association Notes, 3.875% - 4.000%, 5/15/2007 - 5/23/2007		2,962,601
			TOTAL GOVERNMENT AGENCIES		127,611,904
			REPURCHASE AGREEMENTS--73.9%
	16,514,000		Interest in $2,445,000,000 joint repurchase agreement 4.910%, dated 5/31/2006 under which BNP Paribas Securities Corp. will repurchase U.S. Treasury securities with various maturities to 4/15/029 for $2,445,333,471 on 6/1/2006. The market value of the underlying securities at the end of the period was $2,493,900,070.		16,514,000
	8,000,000	³	Interest in $500,000,000 joint repurchase agreement 5.0725%⁴ , dated 4/28/2006 under which Banc of America Securities LLC will repurchase U.S. Government Agency securities with various maturities to 4/25/2036 on 7/27/2006. The market value of the underlying securities at the end of the period was $515,300,812.		8,000,000
	5,000,000	³	Interest in $425,000,000 joint repurchase agreement 5.040%, dated 5/15/2006 under which Banc of America Securities LLC will repurchase U.S. Government Agency securities with various maturities to 5/25/2036 for $427,856,000 on 7/3/2006. The market value of the underlying securities at the end of the period was $436,522,352.		5,000,000
	50,000,000		Interest in $1,700,000,000 joint repurchase agreement 5.040%, dated 5/31/2006 under which Barclays Capital, Inc. will repurchase U.S. Government Agency securities with various maturities to 3/17/2021 for $1,700,238,000 on 6/1/2006. The market value of the underlying securities at the end of the period was $1,734,000,467.		50,000,000
	99,000,000		Interest in $1,000,000,000 joint repurchase agreement 5.050%, dated 5/31/2006 under which Bear Stearns and Co., Inc. will repurchase U.S. Government Agency securities with various maturities to 5/15/2036 for $1,000,140,278 on 6/1/2006. The market value of the underlying securities at the end of the period was $1,030,001,080.		99,000,000
Principal Amount				Value
			REPURCHASE AGREEMENTS--continued
$	21,000,000	³	Interest in $500,000,000 joint repurchase agreement 4.890%, dated 4/5/2006 under which Credit Suisse First Boston Corp. will repurchase U.S. Government Agency securities with various maturities to 5/15/2036 for $504,142,917 on 6/5/2006. The market value of the underlying securities at the end of the period was $515,000,218.	$	21,000,000
	21,000,000	³	Interest in $500,000,000 joint repurchase agreement 4.890%, dated 4/5/2006 under which Credit Suisse First Boston Corp. will repurchase U.S. Government Agency securities with various maturities to 5/25/2036 for $504,075,000 on 6/5/2006. The market value of the underlying securities at the end of the period was $515,003,041.		21,000,000
	15,000,000	³	Interest in $375,000,000 joint repurchase agreement 5.020%, dated 5/4/2006 under which Deutsche Bank Securities, Inc. will repurchase U.S. Government Agency securities and a U.S. Treasury security with various maturities to 12/15/2035 for $377,876,042 on 6/29/2006. The market value of the underlying securities at the end of the period was $389,184,330.		15,000,000
	5,000,000	³	Interest in $950,000,000 joint repurchase agreement 5.040%, dated 5/11/2006 under which Deutsche Bank Securities, Inc. will repurchase U.S. Government Agency securities and a U.S. Treasury security with various maturities to 11/1/2040 for $956,384,000 on 6/29/2006. The market value of the underlying securities at the end of the period was $985,012,006.		5,000,000
	99,000,000		Interest in $1,000,000,000 joint repurchase agreement 5.050%, dated 5/31/2006 under which HSBC Securities (USA), Inc. will repurchase U.S. Government Agency securities with various maturities to 5/1/2036 for $1,000,140,278 on 6/1/2006. The market value of the underlying securities at the end of the period was $1,020,004,341.		99,000,000
	21,000,000	³	Interest in $500,000,000 joint repurchase agreement 4.905%, dated 4/5/2006 under which UBS Securities LLC will repurchase U.S. Government Agency securities with various maturities to 9/15/2034 for $504,836,875 on 6/15/2006. The market value of the underlying securities at the end of the period was $518,930,953.		21,000,000
			TOTAL REPURCHASE AGREEMENTS		360,514,000
			TOTAL INVESTMENTS--100.1% (AT AMORTIZED COST)⁵		488,125,904
			OTHER ASSETS AND LIABILITIES - NET--(0.1)%		(501,018	)
			TOTAL NET ASSETS--100%	$	487,624,886

1 Floating rate note with current rate and next reset date shown.

2 Discount rate at time of purchase.

3 Although the repurchase date is more than seven days after the date of purchase, the fund has the right to terminate the repurchase agreement at any time with seven-days' notice.

4 Rate shown is the rate as of May 31, 2006.

5 Also represents cost for federal tax purposes.

Note: The categories of investments are shown as a percentage of total net assets at May 31, 2006.

See Notes which are an integral part of the Financial Statements

Statement of Assets and Liabilities

May 31, 2006

Assets:
Investments in repurchase agreements	$	360,514,000
Investments in securities		127,611,904
Total investments in securities, at amortized cost and value			$	488,125,904
Income receivable				1,468,526
Receivable for shares sold				550
TOTAL ASSETS				489,594,980
Liabilities:
Payable for investments purchased	$	1,001,594
Payable for shares redeemed		4,701
Income distribution payable		607,817
Payable to bank		125,576
Payable for Directors'/Trustees fees		1,265
Payable for distribution services fee (Note 5)		41,973
Payable for shareholder services fee (Note 5)		104,025
Accrued expenses		83,143
TOTAL LIABILITIES				1,970,094
Net assets for 487,625,454 shares outstanding			$	487,624,886
Net Assets Consist of:
Paid-in capital			$	487,625,454
Distributions in excess of net investment income				(568	)
TOTAL NET ASSETS			$	487,624,886
Net Asset Value, Offering Price and Redemption Proceeds Per Share:
($487,624,886 ÷ 487,625,454 shares outstanding) $0.001 par value, 12,500,000,000 shares authorized				$1.00

See Notes which are an integral part of the Financial Statements

Statement of Operations

Year Ended May 31, 2006

Investment Income:
Interest							$	23,638,032
Expenses:
Investment adviser fee (Note 5)				$	2,931,280
Administrative personnel and services fee (Note 5)					467,153
Custodian fees					32,195
Transfer and dividend disbursing agent fees and expenses					732,244
Directors'/Trustees' fees					7,448
Auditing fees					14,215
Legal fees					8,275
Portfolio accounting fees					102,344
Distribution services fee (Note 5)					586,256
Shareholder services fee (Note 5)					1,465,532
Share registration costs					44,179
Printing and postage					65,558
Insurance premiums					10,809
Taxes					14,775
Miscellaneous					2,766
TOTAL EXPENSES					6,485,029
Waivers (Note 5):
Waiver of investment adviser fee	$	(280,269	)
Waiver of administrative personnel and services fee		(20,426	)
TOTAL WAIVERS					(300,695	)
Net expenses								6,184,334
Net investment income							$	17,453,698

See Notes which are an integral part of the Financial Statements

Statement of Changes in Net Assets

Year Ended May 31		2006			2005
Increase (Decrease) in Net Assets
Operations:
Net investment income	$	17,453,698		$	4,040,767
Distributions to Shareholders:
Distributions from net investment income		(17,450,840	)		(4,044,758	)
Share Transactions:
Proceeds from sale of shares		2,000,752,587			1,237,428,542
Net asset value of shares issued to shareholders in payment of distributions declared		15,178,607			3,112,397
Cost of shares redeemed		(2,074,898,681	)		(1,138,034,345	)
CHANGE IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS		(58,967,487	)		102,506,594
Change in net assets		(58,964,629	)		102,502,603
Net Assets:
Beginning of period		546,589,515			444,086,912
End of period (including distributions in excess of net investment income of $(568) and $(3,426), respectively)	$	487,624,886		$	546,589,515

See Notes which are an integral part of the Financial Statements

Notes to Financial Statements

May 31, 2006

1. ORGANIZATION

Cash Trust Series, Inc. (the "Corporation") is registered under the Investment Company Act of 1940, as amended (the "Act"), as open-end management investment company. The Corporation consists of four portfolios. The financial statements included herein are only those of Government Cash Series (the "Fund"), a diversified portfolio. The financial statements of the other portfolios are presented separately. The assets of each portfolio are segregated and a shareholder's interest is limited to the portfolio in which shares are held. The investment objective of the Fund is current income consistent with stability of principal and liquidity.

2. SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of its financial statements. These policies are in conformity with generally accepted accounting principles (GAAP) in the United States of America.

Investment Valuation

The Fund uses the amortized cost method to value its portfolio securities in accordance with Rule 2a-7 under the Act.

Repurchase Agreements

It is the policy of the Fund to require the other party to a repurchase agreement to transfer to the Fund's custodian or sub-custodian eligible securities or cash with a market value (after transaction costs) at least equal to the repurchase price to be paid under the repurchase agreement. The eligible securities are transferred to accounts with the custodian or sub-custodian in which the Fund holds a "securities entitlement" and exercises "control" as those terms are defined in the Uniform Commercial Code. The Fund has established procedures for monitoring the market value of the transferred securities and requiring the transfer of additional eligible securities if necessary to equal at least the repurchase price. These procedures also allow the other party to require securities to be transferred from the account to the extent that their market value exceeds the repurchase price or in exchange for other eligible securities of equivalent market value.

With respect to agreements to repurchase U.S. government securities and cash items, the Fund treats the repurchase agreement as an investment in the underlying securities and not as an obligation of the other party to the repurchase agreement. Other repurchase agreements are treated as obligations of the other party secured by the underlying securities. Nevertheless, the insolvency of the other party or other failure to repurchase the securities may delay the disposition of the underlying securities or cause the Fund to receive less than the full repurchase price. Under the terms of the repurchase agreement, any amounts received by the Fund in excess of the repurchase price and related transaction costs must be remitted to the other party.

The Fund may enter into repurchase agreements in which eligible securities are transferred into joint trading accounts maintained by the custodian or sub-custodian for investment companies and other clients advised by the Fund's Adviser and its affiliates. The Fund will participate on a pro rata basis with the other investment companies and clients in its share of the securities transferred under such repurchase agreements and in its share of proceeds from any repurchase or other disposition of such securities.

Investment Income, Expenses and Distributions

Interest income and expenses are accrued daily. Distributions to shareholders are recorded on the ex-dividend date. Distributions of net investment income are declared daily and paid monthly.

Premium and Discount Amortization

All premiums and discounts are amortized/accreted.

Federal Taxes

It is the Fund's policy to comply with the Subchapter M provision of the Internal Revenue Code (the "Code") and to distribute to shareholders each year substantially all of its income. Accordingly, no provision for federal income tax is necessary.

Other Taxes

As an open-end management investment company incorporated in the state of Maryland but domiciled in Pennsylvania, the Fund is subject to the Pennsylvania Franchise Tax. This franchise tax is assessed annually on the value of the Fund, as represented by average net assets for the tax year.

When-Issued and Delayed Delivery Transactions

The Fund may engage in when-issued or delayed delivery transactions. The Fund records when-issued securities on the trade date and maintains security positions such that sufficient liquid assets will be available to make payment for the securities purchased. Securities purchased on a when-issued or delayed delivery basis are marked to market daily and begin earning interest on the settlement date. Losses may occur on these transactions due to changes in market conditions or the failure of counterparties to perform under the contract.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts of assets, liabilities, expenses and revenues reported in the financial statements. Actual results could differ from those estimated.

Other

Investment transactions are accounted for on a trade date basis. Realized gains and losses from investment transactions are recorded on an identified cost basis.

3. CAPITAL STOCK

The following table summarizes capital stock activity:

Year Ended May 31	2006		2005
Shares sold	2,000,752,587		1,237,428,542
Shares issued to shareholders in payment of distributions declared	15,178,607		3,112,397
Shares redeemed	(2,074,898,681	)	(1,138,034,345	)
NET CHANGE RESULTING FROM SHARE TRANSACTIONS	(58,967,487	)	102,506,594

4. FEDERAL TAX INFORMATION

The tax character of distributions as reported on the Statement of Changes in Net Assets for the years ended May 31, 2006 and 2005, was as follows:

		2006		2005
Ordinary income¹		$17,450,840		$4,044,758

1 For tax purposes short-term capital gain distributions are considered ordinary income distributions.

As of May 31, 2006, the components of distributable earnings on a tax basis were as follows:

Undistributed ordinary income		$	607,249
Other temporary adjustments		$	(607,817	)

5. INVESTMENT ADVISER FEE AND OTHER TRANSACTIONS WITH AFFILIATES

Investment Adviser Fee

Federated Investment Management Company, the Fund's investment adviser (the "Adviser"), receives for its services an annual investment adviser fee equal to 0.50% of the Fund's average daily net assets. The Adviser may voluntarily choose to waive any portion of its fee. The Adviser can modify or terminate this voluntary waiver at any time at its sole discretion. For the year ended May 31, 2006, the Adviser voluntarily waived $280,269 of its fee.

Administrative Fee

Federated Administrative Services (FAS), under the Administrative Services Agreement, provides the Fund with administrative personnel and services. The fee paid to FAS is based on the average aggregate daily net assets of certain Federated funds as specified below:

Maximum Administrative Fee		Average Aggregate Daily Net Assets of the Federated Funds
0.150%		on the first $5 billion
0.125%		on the next $5 billion
0.100%		on the next $10 billion
0.075%		on assets in excess of $20 billion

The administrative fee received during any fiscal year shall be at least $150,000 per portfolio and $40,000 per each additional class of Shares. FAS may voluntarily choose to waive any portion of its fee. FAS can modify or terminate this voluntary waiver at any time at its sole discretion. For the year ended May 31, 2006, the net fee paid to FAS was 0.076% of average aggregate daily net assets of the Fund.

Distribution Services Fee

The Fund has adopted a Distribution Plan (the "Plan") pursuant to Rule 12b-1 under the Act. Under the terms of the Plan, the Fund will compensate Federated Securities Corp. (FSC), the principal distributor, from the daily net assets of the Fund's shares to finance activities intended to result in the sale of these shares. The Plan provides that the Fund may incur distribution expenses of 0.35% of average daily net assets, annually, to compensate FSC. FSC may voluntarily choose to waive any portion of its fee. FSC can modify or terminate this voluntary waiver at any time at its sole discretion. When FSC receives fees, it may pay some or all of them to financial intemediaries whose customers purchase shares. For the year ended May 31, 2006, FSC did not retain any fees paid by the Fund.

Shareholder Services Fee

The Fund may pay fees (Service Fees) up to 0.25% of the average daily net assets of the Fund's Shares to financial intermediaries or to Federated Shareholder Services Company (FSSC) for providing services to shareholders and maintaining shareholder accounts. FSSC or these financial intermediaries may voluntarily choose to waive any portion of their fee. This voluntary waiver can be modified or terminated at any time. For the year ended May 31, 2006, FSSC received $2,011 of fees paid by the Fund.

General

Certain of the Officers and Directors of the Fund are Officers and Directors or Trustees of the above companies.

6. LEGAL PROCEEDINGS

Beginning in October 2003, Federated Investors, Inc. and various subsidiaries thereof (including the advisers and distributor for various investment companies, collectively, "Federated"), along with various investment companies sponsored by Federated ("Funds") were named as defendants in several class action lawsuits now pending in the United States District Court for the District of Maryland. The lawsuits were purportedly filed on behalf of people who purchased, owned and/or redeemed shares of Federated-sponsored mutual funds during specified periods beginning November 1, 1998. The suits are generally similar in alleging that Federated engaged in illegal and improper trading practices including market timing and late trading in concert with certain institutional traders, which allegedly caused financial injury to the mutual fund shareholders. These lawsuits began to be filed shortly after Federated's first public announcement that it had received requests for information on shareholder trading activities in the Funds from the Securities and Exchange Commission ("SEC"), the Office of the New York State Attorney General ("NYAG"), and other authorities. In that regard, on November 28, 2005, Federated announced that it had reached final settlements with the SEC and the NYAG with respect to those matters. As Federated previously reported in 2004, it has already paid approximately $8.0 million to certain funds as determined by an independent consultant. As part of these settlements, Federated agreed to pay for the benefit of fund shareholders additional disgorgement and a civil money penalty in the aggregate amount of an additional $72 million. Federated and various Funds have also been named as defendants in several additional lawsuits, the majority of which are now pending in the United States District Court for the Western District of Pennsylvania, alleging, among other things, excessive advisory and Rule 12b-1 fees. The Board of the Funds has retained the law firm of Dickstein Shapiro LLP to represent the Funds in these lawsuits. Federated and the Funds, and their respective counsel, are reviewing the allegations and intend to defend this litigation. Additional lawsuits based upon similar allegations may be filed in the future. The potential impact of these lawsuits, all of which seek unquantified damages, attorneys' fees and expenses, and future potential similar suits is uncertain. Although we do not believe that these lawsuits will have a material adverse effect on the Funds, there can be no assurance that these suits, the ongoing adverse publicity and/or other developments resulting from the regulatory investigations will not result in increased Fund redemptions, reduced sales of Fund shares, or other adverse consequences for the Funds.

7. CHANGE IN INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

On May 20, 2005, the Fund's Directors, upon the recommendation of the Audit Committee and completion of the audit for May 31, 2005, appointed Ernst & Young LLP (E&Y) as the Fund's independent registered public accounting firm. The Fund's previous independent registered public accounting firm, Deloitte & Touche LLP (D&T) declined to stand for re-election. The previous reports issued by D&T on the Fund's financial statements for the fiscal years ended May 31, 2004 and May 31, 2005 contained no adverse opinion or disclaimer of opinion nor were they qualified or modified as to uncertainty, audit scope or accounting principles. During the Fund's fiscal years ended May 31, 2004 and May 31, 2005: (i) there were no disagreements with D&T on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of D&T, would have caused it to make reference to the subject matter of the disagreements in connection with its reports on the financial statements for such years; and (ii) there were no reportable events of the kind described in Item 304(a) (1) (v) of Regulation S-K under the Securities Exchange Act of 1934, as amended.

As indicated above, the Fund has appointed E&Y as the independent registered public accounting firm to audit the Fund's financial statements for the fiscal year ended May 31, 2006. During the Fund's fiscal years ended May 31, 2004 and May 31, 2005 and the interim period commencing June 1, 2005 and ended July 19, 2005, neither the Fund nor anyone on its behalf consulted E&Y on items which: (i) concerned the application of accounting principles to a specified transaction, either completed or proposed, or the type of audit opinion that might be rendered on the Fund's financial statements; or (ii) concerned the subject of a disagreement (as defined in paragraph (a) (1) (iv) of Item 304 of Regulation S-K) or reportable events (as described in paragraph (a) (1) (v) of said Item 304).

Report of Independent Registered Public Accounting Firm

TO THE BOARD OF DIRECTORS OF CASH TRUST SERIES, INC. AND THE SHAREHOLDERS OF GOVERNMENT CASH SERIES:

We have audited the accompanying statement of assets and liabilities of Government Cash Series (the "Fund") (one of the portfolios constituting of Cash Trust Series, Inc.), including the portfolio of investments, as of May 31, 2006, and the related statements of operations, changes in net assets, and the financial highlights for the year then ended. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audit. The statement of changes in net assets for the year ended May 31, 2005 and the financial highlights for each of the four years in the period then ended were audited by another independent registered public accounting firm whose report, dated July 19, 2005, expressed an unqualified opinion on that statement and those financial highlights.

We conducted our audit in accordance with 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 and financial highlights are free of material misstatement. We were not engaged to perform an audit of the Fund's internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of May 31, 2006, by correspondence with the custodian and brokers or by other appropriate auditing procedures where replies from brokers were not received. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Government Cash Series, a portfolio of Cash Trust Series, Inc., at May 31, 2006, the results of its operations, the changes in its net assets, and the financial highlights for the year then ended, in conformity with U.S. generally accepted accounting principles.

Ernst & Young LLP

Boston, Massachusetts
July 14, 2006

Board of Directors and Corporation Officers

The Board is responsible for managing the Corporation's business affairs and for exercising all the Corporation's powers except those reserved for the shareholders. The following tables give information about each Board member and the senior officers of the Fund. Where required, the tables separately list Board members who are "interested persons" of the Fund (i.e., "Interested" Board members) and those who are not (i.e., "Independent" Board members). Unless otherwise noted, the address of each person listed is Federated Investors Tower, 1001 Liberty Avenue, Pittsburgh, PA. As of December 31, 2005, the Corporation comprised four portfolios, and the Federated Fund Complex consisted of 43 investment companies (comprising 136 portfolios). Unless otherwise noted, each Officer is elected annually. Unless otherwise noted, each Board member oversees all portfolios in the Federated Fund Complex and serves for an indefinite term. The Fund's Statement of Additional Information includes additional information about Corporation Directors and is available, without charge and upon request, by calling 1-800-341-7400.

INTERESTED DIRECTORS BACKGROUND


Name Birth Date Address Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s)
John F. Donahue* Birth Date: July 28, 1924 DIRECTOR Began serving: May 1989		Principal Occupations : Director or Trustee of the Federated Fund Complex; Chairman and Director, Federated Investors, Inc.; Chairman of the Federated Fund Complex's Executive Committee. Previous Positions : Chairman of the Federated Fund Complex; Trustee, Federated Investment Management Company and Chairman and Director, Federated Investment Counseling.

J. Christopher Donahue* Birth Date: April 11, 1949 PRESIDENT AND DIRECTOR Began serving: May 1989		Principal Occupations : Principal Executive Officer and President of the Federated Fund Complex; Director or Trustee of some of the Funds in the Federated Fund Complex; President, Chief Executive Officer and Director, Federated Investors, Inc.; Chairman and Trustee, Federated Investment Management Company; Trustee, Federated Investment Counseling; Chairman and Director, Federated Global Investment Management Corp.; Chairman, Passport Research, Ltd. (Investment advisory subsidiary of Federated); Trustee, Federated Shareholder Services Company; Director, Federated Services Company. Previous Positions : President, Federated Investment Counseling; President and Chief Executive Officer, Federated Investment Management Company, Federated Global Investment Management Corp. and Passport Research, Ltd.


Name Birth Date Address Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s)
Lawrence D. Ellis, M.D.* Birth Date: October 11, 1932 3471 Fifth Avenue Suite 1111 Pittsburgh, PA DIRECTOR Began serving: May 1989		Principal Occupations : Director or Trustee of the Federated Fund Complex; Professor of Medicine, University of Pittsburgh; Medical Director, University of Pittsburgh Medical Center Downtown; Hematologist, Oncologist and Internist, University of Pittsburgh Medical Center. Other Directorships Held : Member, National Board of Trustees, Leukemia Society of America. Previous Positions : Trustee, University of Pittsburgh; Director, University of Pittsburgh Medical Center.

* Family relationships and reasons for "interested" status: John F. Donahue is the father of J. Christopher Donahue; both are "interested" due to the positions they hold with Federated Investors, Inc. and its subsidiaries. Lawrence D. Ellis, M.D. is "interested" because his son-in-law is employed by the Fund's principal underwriter, Federated Securities Corp.

INDEPENDENT DIRECTORS BACKGROUND


Name Birth Date Address Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s)
Thomas G. Bigley Birth Date: February 3, 1934 15 Old Timber Trail Pittsburgh, PA DIRECTOR Began serving: November 1994		Principal Occupation : Director or Trustee of the Federated Fund Complex. Other Directorships Held : Director, Member of Executive Committee, Children's Hospital of Pittsburgh; Director, University of Pittsburgh. Previous Position : Senior Partner, Ernst & Young LLP.

John T. Conroy, Jr. Birth Date: June 23, 1937 Investment Properties Corporation 3838 North Tamiami Trail Suite 402 Naples, FL DIRECTOR Began serving: August 1991		Principal Occupations : Director or Trustee of the Federated Fund Complex; Chairman of the Board, Investment Properties Corporation; Partner or Trustee in private real estate ventures in Southwest Florida. Previous Positions : President, Investment Properties Corporation; Senior Vice President, John R. Wood and Associates, Inc., Realtors; President, Naples Property Management, Inc. and Northgate Village Development Corporation.


Name Birth Date Address Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s)
Nicholas P. Constantakis Birth Date: September 3, 1939 175 Woodshire Drive Pittsburgh, PA DIRECTOR Began serving: February 1998		Principal Occupation : Director or Trustee of the Federated Fund Complex. Other Directorships Held : Director and Member of the Audit Committee, Michael Baker Corporation (engineering and energy services worldwide). Previous Position : Partner, Andersen Worldwide SC.

John F. Cunningham Birth Date: March 5, 1943 353 El Brillo Way Palm Beach, FL DIRECTOR Began serving: January 1999		Principal Occupation : Director or Trustee of the Federated Fund Complex; Director, WinsorTech. Other Directorships Held : Chairman, President and Chief Executive Officer, Cunningham & Co., Inc. (strategic business consulting); Trustee Associate, Boston College. Previous Positions : Director, Redgate Communications and EMC Corporation (computer storage systems); Chairman of the Board and Chief Executive Officer, Computer Consoles, Inc.; President and Chief Operating Officer, Wang Laboratories; Director, First National Bank of Boston; Director, Apollo Computer, Inc.

Peter E. Madden Birth Date: March 16, 1942 One Royal Palm Way 100 Royal Palm Way Palm Beach, FL DIRECTOR Began serving: August 1991		Principal Occupation : Director or Trustee of the Federated Fund Complex. Other Directorships Held : Board of Overseers, Babson College. Previous Positions : Representative, Commonwealth of Massachusetts General Court; President, State Street Bank and Trust Company and State Street Corporation (retired); Director, VISA USA and VISA International; Chairman and Director, Massachusetts Bankers Association; Director, Depository Trust Corporation; Director, The Boston Stock Exchange.

Charles F. Mansfield, Jr. Birth Date: April 10, 1945 80 South Road Westhampton Beach, NY DIRECTOR Began serving: January 1999		Principal Occupations : Director or Trustee of the Federated Fund Complex; Management Consultant. Previous Positions : Chief Executive Officer, PBTC International Bank; Partner, Arthur Young & Company (now Ernst & Young LLP); Chief Financial Officer of Retail Banking Sector, Chase Manhattan Bank; Senior Vice President, HSBC Bank USA (formerly, Marine Midland Bank); Vice President, Citibank; Assistant Professor of Banking and Finance, Frank G. Zarb School of Business, Hofstra University; Executive Vice President, DVC Group, Inc.


Name Birth Date Address Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s)
John E. Murray, Jr., J.D., S.J.D. Birth Date: December 20, 1932 Chancellor, Duquesne University Pittsburgh, PA DIRECTOR Began serving: February 1995		Principal Occupations : Director or Trustee, and Chairman of the Board of Directors or Trustees, of the Federated Fund Complex; Chancellor and Law Professor, Duquesne University; Partner, Murray, Hogue & Lannis. Other Directorships Held : Director, Michael Baker Corp. (engineering, construction, operations and technical services). Previous Positions : President, Duquesne University; Dean and Professor of Law, University of Pittsburgh School of Law; Dean and Professor of Law, Villanova University School of Law.

Marjorie P. Smuts Birth Date: June 21, 1935 4905 Bayard Street Pittsburgh, PA DIRECTOR Began serving: May 1989		Principal Occupations : Director or Trustee of the Federated Fund Complex; Public Relations/Marketing Consultant/Conference Coordinator. Previous Positions : National Spokesperson, Aluminum Company of America; television producer; President, Marj Palmer Assoc.; Owner, Scandia Bord.

John S. Walsh Birth Date: November 28, 1957 2604 William Drive Valparaiso, IN DIRECTOR Began serving: January 1999		Principal Occupations : Director or Trustee of the Federated Fund Complex; President and Director, Heat Wagon, Inc. (manufacturer of construction temporary heaters); President and Director, Manufacturers Products, Inc. (distributor of portable construction heaters); President, Portable Heater Parts, a division of Manufacturers Products, Inc. Previous Position : Vice President, Walsh & Kelly, Inc.

James F. Will Birth Date: October 12, 1938 Saint Vincent College Latrobe, PA DIRECTOR Began serving: April 2006		Principal Occupations : Director or Trustee of the Federated Fund Complex; Vice Chancellor and President, Saint Vincent College. Other Directorships Held : Allegheny Corporation. Previous Positions : Chairman, President and Chief Executive Officer, Armco, Inc.; President and Chief Executive Officer, Cyclops Industries; President and Chief Operating Officer, Kaiser Steel Corporation.

OFFICERS


Name Birth Date Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years and Previous Position(s)
John W. McGonigle Birth Date: October 26, 1938 EXECUTIVE VICE PRESIDENT AND SECRETARY Began serving: May 1989		Principal Occupations : Executive Vice President and Secretary of the Federated Fund Complex; Vice Chairman, Executive Vice President, Secretary and Director, Federated Investors, Inc. Previous Positions : Trustee, Federated Investment Management Company and Federated Investment Counseling; Director, Federated Global Investment Management Corp., Federated Services Company and Federated Securities Corp.

Richard A. Novak Birth Date: December 25, 1963 TREASURER Began serving: January 2006		Principal Occupations : Principal Financial Officer and Treasurer of the Federated Fund Complex; Senior Vice President, Federated Administrative Services; Financial and Operations Principal for Federated Securities Corp., Edgewood Services, Inc. and Southpointe Distribution Services, Inc. Previous Positions : Vice President, Finance of Federated Services Company; held various financial management positions within The Mercy Hospital of Pittsburgh; Auditor, Arthur Andersen & Co.

Richard B. Fisher Birth Date: May 17, 1923 VICE CHAIRMAN Began serving: August 2002		Principal Occupations : Vice Chairman or Vice President of some of the Funds in the Federated Fund Complex; Vice Chairman, Federated Investors, Inc.; Chairman, Federated Securities Corp. Previous Positions : President and Director or Trustee of some of the Funds in the Federated Fund Complex; Executive Vice President, Federated Investors, Inc. and Director and Chief Executive Officer, Federated Securities Corp.

Brian P. Bouda Birth Date: February 28, 1947 SENIOR VICE PRESIDENT AND CHIEF COMPLIANCE OFFICER Began serving: August 2004		Principal Occupations : Senior Vice President and Chief Compliance Officer of the Federated Fund Complex; Vice President and Chief Compliance Officer of Federated Investors, Inc.; and Chief Compliance Officer of its subsidiaries. Mr. Bouda joined Federated in 1999 and is a member of the American Bar Association and the State Bar Association of Wisconsin.


Name Birth Date Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years and Previous Position(s)
Deborah A. Cunningham Birth Date: September 15, 1959 CHIEF INVESTMENT OFFICER Began serving: May 2004		Principal Occupations : Deborah A. Cunningham has been the Fund's Portfolio Manager since January 1994. She was named Chief Investment Officer of money market products in 2004 and is a Vice President of the Corporation. She joined Federated in 1981 and has been a Senior Portfolio Manager and a Senior Vice President of the Fund's Adviser since 1997. Ms. Cunningham is a Chartered Financial Analyst and received her M.S.B.A. in Finance from Robert Morris College.

Mary Jo Ochson Birth Date: September 12, 1953 VICE PRESIDENT Began serving: November 1998		Principal Occupations : Mary Jo Ochson was named Chief Investment Officer of tax-exempt fixed income products in 2004 and is a Vice President of the Corporation. She joined Federated in 1982 and has been a Senior Portfolio Manager and a Senior Vice President of the Fund's Adviser since 1996. Ms. Ochson is a Chartered Financial Analyst and received her M.B.A. in Finance from the University of Pittsburgh.

Evaluation and Approval of Advisory Contract

GOVERNMENT CASH SERIES (THE "FUND")

The Fund's Board reviewed the Fund's investment advisory contract at meetings held in May 2006. The Board's decision regarding the contract reflects the exercise of its business judgment on whether to continue the existing arrangements.

Prior to the meeting, the Adviser had recommended that the Federated Funds appoint a Senior Officer, whose duties include specified responsibilities relating to the process by which advisory fees are to be charged to a Federated Fund. The Senior Officer appointed by the Funds has the authority to retain consultants, experts, or staff as may be reasonably necessary to assist in the performance of his duties, reports directly to the Board, and may be terminated only with the approval of a majority of the independent members of the Board. The Senior Officer prepared and furnished to the Board an independent written evaluation that covered topics discussed below, which the Board considered, along with other information, in deciding to approve the advisory contract.

During its review of the contract, the Board considered compensation and benefits received by the Adviser. This included the fees received for services provided to the Fund by other entities in the Federated organization and research services received by the Adviser from brokers that execute Federated fund trades, as well as advisory fees. The Board is also familiar with judicial decisions concerning allegedly excessive investment advisory fees which have indicated that the following factors may be relevant to an Adviser's fiduciary duty with respect to its receipt of compensation from a fund: the nature and quality of the services provided by the Adviser, including the performance of the Fund; the Adviser's cost of providing the services; the extent to which the Adviser may realize "economies of scale" as the Fund grows larger; any indirect benefits that may accrue to the Adviser and its affiliates as a result of the Adviser's relationship with the Fund; performance and expenses of comparable funds; and the extent to which the independent Board members are fully informed about all facts the Board deems relevant bearing on the Adviser's services and fees. The Board further considered management fees (including any components thereof) charged to institutional and other clients of the Adviser for like services and costs to the Adviser and its affiliates of supplying services pursuant to the management fee agreements, excluding any intra-corporate profit and profit margins of the Adviser and its affiliates from supplying such services. The Board was aware of these considerations and was guided by them in its review of the Fund's advisory contract to the extent they are appropriate and relevant, as discussed further below.

The Board considered and weighed these circumstances in light of its substantial accumulated experience in governing the Fund and working with Federated on matters relating to the Federated funds, and was assisted in its deliberations by the advice of independent legal counsel. Throughout the year, the Board has requested and received substantial and detailed information about the Fund and the Federated organization that was in addition to the extensive materials that comprise the Senior Officer's evaluation. Federated provided much of this information at each regular meeting of the Board, and furnished additional reports in connection with the particular meeting at which the Board's formal review of the advisory contract occurred. Between regularly scheduled meetings, the Board has received information on particular matters as the need arose. Thus, the Board's consideration of the advisory contract included review of the Senior Officer's evaluation, accompanying data and additional reports covering such matters as: the Adviser's investment philosophy, revenue, profitability, personnel and processes; investment and operating strategies; the Fund's short- and long-term performance (in absolute terms, both on a gross basis and net of expenses, as well as in relationship to its particular investment program and certain competitor or "peer group" funds and/or other benchmarks, as appropriate), and comments on the reasons for performance; the Fund's investment objectives; the Fund's expenses (including the advisory fee itself and the overall expense structure of the Fund, both in absolute terms and relative to similar and/or competing funds, with due regard for contractual or voluntary expense limitations); the use and allocation of brokerage commissions derived from trading the Fund's portfolio securities (if any); the nature, quality and extent of the advisory and other services provided to the Fund by the Adviser and its affiliates; the preferences and expectations of Fund shareholders and their relative sophistication; the continuing state of competition in the mutual fund industry and market practices; the range of comparable fees for similar funds in the mutual fund industry; the Fund's relationship to the Federated family of funds which include a comprehensive array of funds with different investment objectives, policies and strategies which are available for exchange without the incurrence of additional sales charges; compliance and audit reports concerning the Federated funds and the Federated companies that service them (including communications from regulatory agencies), as well as Federated's responses to any issues raised therein; and relevant developments in the mutual fund industry and how the Federated funds and/or Federated are responding to them. The Board's evaluation process is evolutionary. The criteria considered and the emphasis placed on relevant criteria change in recognition of changing circumstances in the mutual fund marketplace.

With respect to the Fund's performance and expenses in particular, the Board has found the use of comparisons to other mutual funds with comparable investment programs to be particularly useful, given the high degree of competition in the mutual fund business. The Board focused on comparisons with other similar mutual funds more heavily than non-mutual fund products or services because, simply put, they are more relevant. For example, other mutual funds are the products most like the Fund, they are readily available to Fund shareholders as alternative investment vehicles, and they are the type of investment vehicle in fact chosen and maintained by the Fund's investors. The range of their fees and expenses therefore appears to be a generally reliable indication of what consumers have found to be reasonable in the precise marketplace in which the Fund competes. The Fund's ability to deliver competitive performance when compared to its peer group was a useful indicator of how the Adviser is executing the Fund's investment program, which in turn assisted the Board in reaching a conclusion that the nature, extent, and quality of the Adviser's investment management services were such as to warrant continuation of the advisory contract. In this regard, the Senior Officer has reviewed Federated's fees for providing advisory services to products outside the Federated family of funds ( e.g. , institutional and separate accounts). He concluded that mutual funds and institutional accounts are inherently different products. Those differences included, but are not limited to targeting different investors, being subject to different laws and regulations, different legal structure, distribution costs, average account size and portfolio management techniques made necessary by different cash flows. The Senior Officer did not consider these fee schedules to be significant in determining the appropriateness of mutual fund advisory contracts.

The Senior Officer reviewed reports compiled by Federated, and directed the preparation of independent reports, regarding the performance of, and fees charged by, other mutual funds, noting his view that comparisons to fund peer groups is of significance in judging the reasonableness of proposed fees.

During the year ending December 31, 2005, the Fund's performance was below the median of the relevant peer group.

The Board also received financial information about Federated, including reports on the compensation and benefits Federated derived from its relationships with the Federated funds. These reports covered not only the fees under the advisory contracts, but also fees received by Federated's subsidiaries for providing other services to the Federated funds under separate contracts (e.g., for serving as the Federated funds' administrator). The reports also discussed any indirect benefit Federated may derive from its receipt of research services from brokers who execute Federated fund trades as well as waivers of fees and/or reimbursements of expenses. In order for a fund to be competitive in the marketplace, Federated and its affiliates frequently waived fees and/or reimbursed expenses and have indicated to the Board their intention to do so in the future, where appropriate.

Federated furnished reports, requested by the Senior Officer, that reported revenues on a fund by fund basis and made estimates of the allocation of expenses on a fund by fund basis, using allocation methodologies specified by the Senior Officer. The Senior Officer noted that, although they may apply consistent allocation processes, the inherent difficulties in allocating costs and the lack of consensus on how to allocate those costs causes such allocation reports to be of questionable value. The allocation reports were considered in the analysis by the Board but were determined to be of limited use.

The Board also reviewed profitability information for Federated and other publicly held fund management companies, provided by the Senior Officer, who noted the limited availability of such information, and concluded that Federated's profit margins did not appear to be excessive.

The Senior Officer's evaluation also discussed the notion of possible realization of "economies of scale" as a fund grows larger. The Board considered in this regard that the Adviser has made significant additional investments in the portfolio management and distribution efforts supporting all of the Federated funds and that the benefits of any economies, should they exist, were likely to be enjoyed by the fund complex as a whole. Finally, the Board also noted the absence of any applicable regulatory or industry guidelines on this subject, which is compounded by the lack of any common industry practice or general pattern with respect to structuring fund advisory fees with "breakpoints" that serve to reduce the fee as the fund attains a certain size. The Senior Officer did not recommend institution of breakpoints in pricing Federated's fund advisory services at this time.

During the year ending December 31, 2005, the Fund's investment advisory fee after waivers and expense reimbursements was above the median of the relevant peer group.

At the Senior Officer's recommendation, the Board reviewed the fees and other expenses of the Fund with the Adviser. After discussion regarding peer group classification, the Board was satisfied that the overall expense structure of the Fund remained competitive. The Board will continue to monitor advisory fees and other expenses borne by the Fund.

In its decision to continue an existing investment advisory contract, the Board was mindful of the potential disruptions of the Fund's operations and various risks, uncertainties and other effects that could occur as a result of a decision to terminate or not renew an advisory contract. In particular, the Board recognized that most shareholders have invested in the Fund on the strength of the Adviser's industry standing and reputation and in the expectation that the Adviser will have a continuing role in providing advisory services to the Fund. Thus, the Board's approval of the advisory contract reflected the fact that it is the shareholders who have effectively selected the Adviser by virtue of having invested in the Fund.

The Board based its decision to approve the advisory contract on the totality of the circumstances and relevant factors and with a view to past and future long-term considerations. Not all of the factors and considerations identified above were relevant to every Federated fund, nor did the Board consider any one of them to be determinative. With respect to the factors that were relevant, the Board's decision to approve the contract reflects its determination that Federated's performance and actions provided a satisfactory basis to support the decision to continue the existing arrangements.

The Senior Officer also made recommendations relating to the organization and availability of data and verification of processes for purposes of implementing future evaluations which the Adviser has agreed to implement.

Voting Proxies on Fund Portfolio Securities

A description of the policies and procedures that the Fund uses to determine how to vote proxies, if any, relating to securities held in the Fund's portfolio is available, without charge and upon request, by calling 1-800-341-7400. A report on "Form N-PX" of how the Fund voted any such proxies during the most recent 12-month period ended June 30 is available through Federated's website. Go to FederatedInvestors.com, select "Products," select the "Prospectuses and Regulatory Reports" link, then select the Fund to access the link to Form N-PX. This information is also available from the EDGAR database on the SEC's website at www.sec.gov.

Quarterly Portfolio Schedule

The Fund files with the SEC a complete schedule of its portfolio holdings, as of the close of the first and third quarters of its fiscal year, on "Form N-Q." These filings are available on the SEC's website at www.sec.gov and may be reviewed and copied at the SEC's Public Reference Room in Washington, DC. (Call 1-800-SEC-0330 for information on the operation of the Public Reference Room.) You may also access this information from the "Products" section of Federated's website at FederatedInvestors.com by clicking on "Portfolio Holdings" and selecting the name of the Fund, or by selecting the name of the Fund and clicking on "Portfolio Holdings." You must register on the website the first time you wish to access this information.

Mutual funds are not bank deposits or obligations, are not guaranteed by any bank, and are not insured or guaranteed by the U.S. government, the Federal Deposit Insurance Corporation, the Federal Reserve Board, or any other government agency. Investment in mutual funds involves investment risk, including the possible loss of principal. Although money market funds seek to maintain a stable net asset value of $1.00 per share, there is no assurance that they will be able to do so.

This report is authorized for distribution to prospective investors only when preceded or accompanied by the Fund's prospectus, which contains facts concerning its objective and policies, management fees, expenses, and other information.

Federated
World-Class Investment Manager

Government Cash Series
Federated Investors Funds
5800 Corporate Drive
Pittsburgh, PA 15237-7000
Contact us at FederatedInvestors.com
or call 1-800-341-7400.

Federated Securities Corp., Distributor

Cusip 147551204

28564 (7/06)

Federated is a registered mark of Federated Investors, Inc. 2006 (c)Federated Investors, Inc.

Federated
World-Class Investment Manager

Municipal Cash Series

A Portfolio of Cash Trust Series, Inc.

ANNUAL SHAREHOLDER REPORT

May 31, 2006

FINANCIAL HIGHLIGHTS
SHAREHOLDER EXPENSE EXAMPLE
PORTFOLIO OF INVESTMENTS SUMMARY TABLES
PORTFOLIO OF INVESTMENTS
STATEMENT OF ASSETS AND LIABILITIES
STATEMENT OF OPERATIONS
STATEMENT OF CHANGES IN NET ASSETS
NOTES TO FINANCIAL STATEMENTS
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
BOARD OF DIRECTORS AND CORPORATION OFFICERS
EVALUATION AND APPROVAL OF ADVISORY CONTRACT
VOTING PROXIES ON FUND PORTFOLIO SECURITIES
QUARTERLY PORTFOLIO SCHEDULE

Not FDIC Insured * May Lose Value * No Bank Guarantee

Federated Investors 50 Years of Growth & Innovation

Financial Highlights

(For a Share Outstanding Throughout Each Period)

Year Ended May 31	2006	¹	2005		2004		2003		2002
Net Asset Value, Beginning of Period	$1.00		$1.00		$1.00		$1.00		$1.00
Income From Investment Operations:
Net investment income	0.020		0.008		0.001		0.005		0.012
Less Distributions:
Distributions from net investment income	(0.020	)	(0.008	)	(0.001	)	(0.005	)	(0.012	)
Net Asset Value, End of Period	$1.00		$1.00		$1.00		$1.00		$1.00
Total Return²	1.98	%	0.76	%	0.13	%	0.51	%	1.20	%

Ratios to Average Net Assets:
Net expenses	1.05	%	1.05	%	1.05	%	1.05	%	1.05	%
Net investment income	1.92	%	0.81	%	0.13	%	0.52	%	1.16	%
Expense waiver/reimbursement³	0.05	%	0.04	%	0.03	%	0.07	%	0.05	%
Supplemental Data:
Net assets, end of period (000 omitted)	$334,001		$400,545		$353,473		$426,684		$538,236

1 Beginning with the year ended May 31, 2006, the Fund was audited by Ernst & Young LLP. The previous years were audited by another independent registered public accounting firm.

2 Based on net asset value. Total returns for periods of less than one year, if any, are not annualized.

3 This expense decrease is reflected in both the net expense and the net investment income ratios shown above.

See Notes which are an integral part of the Financial Statements

Shareholder Expense Example

ACTUAL EXPENSES

HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES

	Beginning Account Value 12/1/2005	Ending Account Value 5/31/2006	Expenses Paid During Period¹
Actual	$1,000	$1,011.60	$5.27
Hypothetical (assuming a 5% return before expenses)	$1,000	$1,019.70	$5.29

1 Expenses are equal to the Fund's annualized net expense ratio of 1.05%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).

Portfolio of Investments Summary Tables

At May 31, 2006, the Fund's portfolio composition¹ was as follows:

	Percentage of Total Net Assets
Variable Rate Instruments	77.4	%
Municipal Notes	21.9	%
Commercial Paper	1.1	%
Other Assets and Liabilities--Net²	(0.4	)%
TOTAL	100.0	%

At May 31, 2006, the Fund's effective maturity schedule³ was as follows:

Securities with an Effective Maturity of:	Percentage of Total Net Assets
1-7 Days	81.8	%
8-30 Days	4.8	%
31-90 Days	2.2	%
91-180 Days	5.0	%
181 Days or more	6.6	%
Other Assets and Liabilities--Net²	(0.4	)%
TOTAL	100.0	%

1 See the Fund's Prospectus and Statement of Additional Information for a description of these investments.

2 Assets, other than investments in securities, less liabilities. See Statement of Assets and Liabilities.

3 Effective maturity is determined in accordance with the requirements of Rule 2a-7 under the Investment Company Act of 1940, which regulates money market mutual funds.

Portfolio of Investments

May 31, 2006

Principal Amount					Value
			SHORT-TERM MUNICIPALS--100.4%^1,2
			Alabama--2.0%
$	1,360,000		Birmingham, AL IDA, Weekly VRDNs (Mrs. Strattons Salads, Inc.)/(Wachovia Bank N.A. LOC), 3.630%, 6/2/2006	$	1,360,000
	2,314,000		Birmingham, AL IDA, IDRB's (Series 1999), Weekly VRDNs (Glasforms, Inc.)/(Wells Fargo Bank, N.A. LOC), 3.620%, 6/1/2006		2,314,000
	3,100,000		Piedmont, AL IDB, Weekly VRDNs (Bostrom Seating, Inc.)/(Citibank N.A., New York LOC), 3.670%, 6/1/2006		3,100,000
			TOTAL		6,774,000
			Arizona--1.2%
	1,000,000		Arizona Health Facilities Authority, (Series 2002), Weekly VRDNs (Royal Oaks Life Care Community)/(LaSalle Bank, N.A. LOC), 3.470%, 6/1/2006		1,000,000
	3,000,000	³	Phoenix, AZ IDA, PT-479 Weekly VRDNs (Sunset Ranch Apartments)/(FHLMC GTD)/(FHLMC LIQ), 3.520%, 6/1/2006		3,000,000
			TOTAL		4,000,000
			Colorado--1.7%
	2,000,000		Adams County, CO IDB, (Series 1993), Weekly VRDNs (Bace Manufacturing, Inc.)/(WestLB AG LOC), 3.680%, 6/1/2006		2,000,000
	1,440,000		Colorado HFA, (Series 2000A), Weekly VRDNs (New Belgium Brewing Co., Inc.)/(Wells Fargo Bank, N.A. LOC), 3.580%, 6/1/2006		1,440,000
	510,000		Colorado HFA, (Series 2000B), Weekly VRDNs (New Belgium Brewing Co., Inc.)/(Wells Fargo Bank, N.A. LOC), 3.580%, 6/1/2006		510,000
	1,600,000		Thornton, CO, (Series 2003), Weekly VRDNs (Kroger Co.)/(U.S. Bank, N.A. LOC), 3.570%, 6/1/2006		1,600,000
			TOTAL		5,550,000
			District of Columbia--1.2%
	4,000,000	³	District of Columbia HFA, (Series 2005 BNY5), Weekly VRDNs (Trinity Plus Funding Co. LLC)/(Bank of New York LIQ), 3.590%, 6/1/2006		4,000,000
Principal Amount					Value
			SHORT-TERM MUNICIPALS--continued^1,2
			Florida--3.9%
$	1,710,000	³	Escambia County, FL HFA, (Series 2004 FR/RI-L12), Weekly VRDNs (GNMA COL)/(Lehman Brothers Holdings, Inc. LIQ), 3.620%, 6/1/2006	$	1,710,000
	3,000,000		Greater Orlando, FL Aviation Authority Weekly VRDNs (Cessna Aircraft Co.)/(Textron Inc. GTD), 4.320%, 6/7/2006		3,000,000
	2,866,000	³	Hillsborough County, FL Port District, Floater Certificates (Series 2004-1019), 3.50% TOBs (Tampa, FL Port Authority)/(MBIA Insurance Corp. INS)/(Morgan Stanley LIQ), Optional Tender 6/15/2006		2,866,000
	5,495,000	³	Lee County, FL Solid Waste System, (Series 2006 FR/RI-P11), Weekly VRDNs (MBIA Insurance Corp. INS)/(Lehman Brothers Holdings, Inc. LIQ), 3.360%, 6/7/2006		5,495,000
			TOTAL		13,071,000
			Georgia--0.7%
	1,500,000		Burke County, GA Development Authority, (Series 1999A) Daily VRDNs (Oglethorpe Power Corp.)/(AMBAC INS)/(J.P. Morgan Chase Bank, N.A. LIQ), 3.590%, 6/1/2006		1,500,000
	1,000,000		Fulton County, GA Development Authority, (Series 2001), Weekly VRDNs (Trinity School, Inc.)/(SunTrust Bank LOC), 3.470%, 6/7/2006		1,000,000
			TOTAL		2,500,000
			Illinois--5.7%
	1,845,000		Chicago, IL, (Series 2001), Weekly VRDNs (J.M.B. Moesle LLC)/(Harris, N.A. LOC), 3.400%, 6/1/2006		1,845,000
	1,925,000		Illinois Development Finance Authority IDB Weekly VRDNs (T&D Investments LLC)/(U.S. Bank, N.A. LOC), 3.770%, 6/1/2006		1,925,000
	4,975,000		Illinois Development Finance Authority IDB, (Series 1997), Weekly VRDNs (Tempco Electric Heater Corp.)/(JPMorgan Chase Bank, N.A. LOC), 3.750%, 6/1/2006		4,975,000
	1,000,000		Illinois Development Finance Authority IDB, (Series 2001), Weekly VRDNs (Apogee Enterprises, Inc.)/(Bank of New York LOC), 3.570%, 6/1/2006		1,000,000
	2,630,000		Illinois Development Finance Authority IDB, Adjustable Rate IDRB (Series 1996A), Weekly VRDNs (Nimlok Co.)/(J.P. Morgan Chase Bank, N.A. LOC), 3.750%, 6/1/2006		2,630,000
	3,750,000		Illinois Development Finance Authority MFH, (Series 1999), Weekly VRDNs (Butterfield Creek Associates LP)/(LaSalle Bank, N.A. LOC), 3.580%, 6/1/2006		3,750,000
	3,000,000		Illinois Development Finance Authority, (Series 2002), Weekly VRDNs (Kasbergen Family Living Trust)/(Bank of the West, San Francisco, CA LOC), 3.620%, 6/1/2006		3,000,000
			TOTAL		19,125,000
Principal Amount					Value
			SHORT-TERM MUNICIPALS--continued^1,2
			Indiana--5.1%
$	1,060,000		Carmel, IN, (Series 1999), Weekly VRDNs (Telamon Corp.)/(LaSalle Bank, N.A. LOC), 3.610%, 6/1/2006	$	1,060,000
	1,086,000		Crawfordsville, IN EDA, (Series 1995: Shady Knoll III Apartments), Weekly VRDNs (Pedcor Investments-1994-XXII LP)/(FHLB of Indianapolis LOC), 3.610%, 6/1/2006		1,086,000
	7,978,000		Elkhart County, IN MFH, (Series 2002A: North Lake Apartments), Weekly VRDNs (Pedcor Investments-2002-LVI LP)/( FHLB of Cincinnati LOC), 3.600%, 6/1/2006		7,978,000
	1,005,000		Frankfort, IN EDA, (Series 2004), Weekly VRDNs (Wesley Manor, Inc.)/(Key Bank, N.A. LOC), 3.520%, 6/1/2006		1,005,000
	1,345,000		Huntington, IN, (Series 1998), Weekly VRDNs (DK Enterprises LLC)/(Wells Fargo Bank, N.A., Minnesota LOC), 3.680%, 6/1/2006		1,345,000
	810,000		Indiana Development Finance Authority, (Series 1996), Weekly VRDNs (Meridian Group LLC)/(J.P. Morgan Chase Bank, N.A. LOC), 3.850%, 6/1/2006		810,000
	1,500,000		Indiana Development Finance Authority, EDRB (Series 2002), Weekly VRDNs (Vreba-Hoff Dairy Leasing LLC)/(Northern Trust Co., Chicago, IL LOC), 3.620%, 6/1/2006		1,500,000
	250,000		Lebanon, IN IDA, (Series 1991), Weekly VRDNs (White Castle System)/(J.P. Morgan Chase Bank, N.A. LOC), 3.650%, 6/1/2006		250,000
	1,960,000		Miami County, IN, (Series 2001: Timberland RV Project), Weekly VRDNs (Timberlodge Real Estate LLC)/(National City Bank, Indiana LOC), 3.630%, 6/1/2006		1,960,000
			TOTAL		16,994,000
			Kansas--3.9%
	10,000,000	³	Clipper Tax-Exempt Certificates Trust (Kansas-AMT), (Series 2005-13), Weekly VRDNs (Sedgwick & Shawnee Counties, KS)/(GNMA COL)/(State Street Bank and Trust Co. LIQ), 3.560%, 6/1/2006		10,000,000
	2,985,000		Wyandotte County, KS, (Series 1999), Weekly VRDNs (Shor-Line)/(U.S. Bank, N.A. LOC), 3.670%, 6/7/2006		2,985,000
			TOTAL		12,985,000
			Kentucky--1.2%
	840,000		Fort Mitchell, KY IDA, 4.35% TOBs (Motor Inn, Inc.)/(Huntington National Bank, Columbus, OH LOC), Optional Tender 11/1/2006		840,000
	1,100,000		Henderson County, KY, (Series 1996A), Weekly VRDNs (Gibbs Die Casting Corp.)/(Fifth Third Bank, Cincinnati LOC), 3.670%, 6/1/2006		1,100,000
Principal Amount					Value
			SHORT-TERM MUNICIPALS--continued^1,2
			Kentucky--continued
$	1,307,000		Kenton County, KY, (Series 1999), Weekly VRDNs (Packaging Un-limited of Northern Kentucky, Inc.)/(National City Bank, Kentucky LOC), 3.580%, 6/1/2006	$	1,307,000
	800,000		Winchester, KY, (Series 1990), Weekly VRDNs (Walle Corp.)/(UBS AG LOC), 3.550%, 6/1/2006		800,000
			TOTAL		4,047,000
			Louisiana--0.7%
	2,500,000		New Orleans, LA IDB, (Series 2000), Weekly VRDNs (Home Furnishings Store)/(J.P. Morgan Chase Bank, N.A. LOC), 3.720%, 6/1/2006		2,500,000
			Maine--1.0%
	3,190,000		Paris, ME, (Series 2001), Weekly VRDNs (Maine Machine Products Co.)/(Key Bank, N.A. LOC), 3.610%, 6/1/2006		3,190,000
			Maryland--1.1%
	1,705,000		Maryland State Community Development Administration, (Series 1990B), Weekly VRDNs (Cherry Hill Apartment Ltd.)/(Manufacturers & Traders Trust Co., Buffalo, NY LOC), 3.290%, 6/7/2006		1,705,000
	1,640,000		Maryland State Economic Development Corp., (Series 1998A-Catterton Printing Company Facility), Weekly VRDNs (Sky II LLC)/(Manufacturers & Traders Trust Co., Buffalo, NY LOC), 3.720%, 6/6/2006		1,640,000
	330,000		Maryland State Economic Development Corp., (Series 1998B), Weekly VRDNs (Catterton Printing Co. Facility)/(Manufacturers & Traders Trust Co., Buffalo, NY LOC), 3.720%, 6/6/2006		330,000
			TOTAL		3,675,000
			Minnesota--2.2%
	4,960,000	³	Becker, MN, (Series 2005 FR/RI-FP13), Weekly VRDNs (Northern States Power Co., MN)/(Lehman Brothers Holdings, Inc. SWP), 3.720%, 6/1/2006		4,960,000
	715,000		Brooklyn Park, MN EDA, (Series 1999), Weekly VRDNs (Midwest Finishing, Inc.)/(Wells Fargo Bank, N.A., Minnesota LOC), 3.680%, 6/1/2006		715,000
	420,000		Plymouth, MN Weekly VRDNs (Nuaire, Inc.)/(Wells Fargo Bank, N.A., Minnesota LOC), 3.680%, 6/1/2006		420,000
	1,190,000		Red Wing, MN Port Authority, (Series 1998), Weekly VRDNs (Food Service Specialties)/(Wells Fargo Bank, N.A., Minnesota LOC), 3.680%, 6/1/2006		1,190,000
			TOTAL		7,285,000
Principal Amount					Value
			SHORT-TERM MUNICIPALS--continued^1,2
			Mississippi--0.9%
$	3,000,000		Mississippi Regional Housing Authority No. II, (Series 2000), 4.35% TOBs (Terrace Park Apartments)/(First Tennessee Bank, N.A. LOC), Mandatory Tender 5/1/2007	$	3,000,000
			Missouri--3.4%
	6,250,000		Missouri Higher Education Loan Authority, Student Loan Revenue Bonds (Series 2006E), Weekly VRDNs (MBIA Insurance Corp. INS)/(DePfa Bank PLC LIQ), 3.550%, 6/1/2006		6,250,000
	5,000,000		Southwest City, MO IDA, (Series 2005), Weekly VRDNs (Simmons Foods, Inc.)/(Wells Fargo Bank, N.A. LOC), 3.570%, 6/1/2006		5,000,000
			TOTAL		11,250,000
			Multi State--6.7%
	12,000,000	³	Charter Mac Floater Certificates Trust I, (Nat-5 Series), Weekly VRDNs (MBIA Insurance Corp. INS)/(Bank of America N.A., Bayerische Landesbank (GTD), Dexia Credit Local, KBC Bank N.V., Landesbank Baden-Wuerttemberg (GTD), Lloyds TSB Bank PLC, London and State Street Bank and Trust Co. LIQs), 3.550%, 6/1/2006		12,000,000
	5,994,000	³	Clipper Tax-Exempt Certificates Trust (AMT MultiState), (Series 1999-3), Weekly VRDNs (State Street Bank and Trust Co. LIQ), 3.620%, 6/1/2006		5,994,000
	1,516,000	³	Clipper Tax-Exempt Certificates Trust (Multistate-AMT), (Series 2005-1), Weekly VRDNs (GNMA COL)/(State Street Bank and Trust Co. LIQ), 3.620%, 6/1/2006		1,516,000
	2,938,000	³	Clipper Tax-Exempt Certificates Trust (Multistate-AMT), (Series 2005-19), Weekly VRDNs (GNMA COL)/(Merrill Lynch & Co., Inc. LIQ), 3.600%, 6/1/2006		2,938,000
			TOTAL		22,448,000
			Nevada--0.6%
	2,000,000		Clark County, NV, Passenger Facility Charge Refunding Revenue Bonds (Series 2005 A-1), Weekly VRDNs (Las Vegas-McCarran International Airport)/(MBIA Insurance Corp. INS)/(Bayerische Landesbank (GTD) LIQ), 3.270%, 6/7/2006		2,000,000
			New Hampshire--1.2%
	4,000,000		New Hampshire Business Finance Authority, PCR Bonds (1990 Series A), 3.53% CP (New England Power Co.), Mandatory Tender 7/18/2006		4,000,000
			New Mexico--3.7%
	12,412,852		New Mexico Mortgage Finance Authority, (Series 2005), 5.04% TOBs (Trinity Plus Funding Co. LLC), Mandatory Tender 6/1/2006		12,412,852
Principal Amount					Value
			SHORT-TERM MUNICIPALS--continued^1,2
			North Dakota--1.1%
$	300,000		Fargo, ND, (Series 1997), Weekly VRDNs (Owen Industries, Inc.)/(Wells Fargo Bank, N.A. LOC), 3.520%, 6/1/2006	$	300,000
	3,410,000		Grand Forks, ND, (Series 1999), Weekly VRDNs (LM Glasfiber North Dakota, Inc.)/(Wells Fargo Bank, N.A., Minnesota LOC), 3.620%, 6/1/2006		3,410,000
			TOTAL		3,710,000
			Ohio--12.8%
	2,000,000		Belmont County, OH, 4.25% BANs, 6/12/2006		2,010,591
	1,035,000		Elyria, OH, 4.00% BANs, 6/12/2006		1,036,580
	1,565,000		Fairborn, OH, 4.00% BANs, 6/12/2006		1,566,373
	6,000,000		Gallia County, OH Local School District, School Improvement Notes, 4.50% BANs, 6/15/2006		6,002,495
	1,180,000		Kirtland, OH, 3.15% BANs, 6/12/2006		1,180,351
	1,500,000		Massillon, OH, 3.76% BANs, 6/12/2006		1,502,702
	1,267,000		Morrow County, OH, 4.00% BANs, 6/12/2006		1,268,664
	215,000		Ohio State, IDR (Series 1991), Weekly VRDNs (Standby Screw, Inc.)/(National City Bank, Ohio LOC), 3.540%, 6/7/2006		215,000
	2,154,100		Painesville, OH, (Series 2006-1), 4.50% BANs, 6/12/2006		2,169,445
	2,137,000		Painesville, OH, (Series 2006-2), 4.15% BANs, 6/12/2006		2,143,384
	2,462,000		Pataskala, OH, 4.00% BANs, 6/12/2006		2,467,669
	1,300,000		Perrysburg, OH, 3.65% BANs, 6/12/2006		1,302,220
	2,310,000		Richland County, OH, 4.25% BANs, 6/12/2006		2,319,445
	2,975,000		Ross County, OH, 4.75% BANs, 6/12/2006		3,002,132
	2,000,000		Rossford, OH, 4.00% BANs, 6/12/2006		2,000,707
	420,000		Summit County, OH IDA, (Series 1999), Weekly VRDNs (Waltco Truck Equipment)/(Svenska Handelsbanken, Stockholm LOC), 3.600%, 6/1/2006		420,000
	3,500,000		Sylvania, OH, 4.50% BANs, 6/12/2006		3,523,735
	5,000,000		Trumbull County, OH Sewer District, (Series A), 4.00% BANs, 6/12/2006		5,014,172
	2,500,000		Union County, OH, 3.20% BANs, 6/7/2006		2,500,000
	1,000,000		Wauseon, OH, 3.80% BANs, 6/12/20066		1,001,436
			TOTAL		42,647,101
Principal Amount					Value
			SHORT-TERM MUNICIPALS--continued^1,2
			Oklahoma--1.9%
$	2,000,000		Broken Arrow, OK EDA Weekly VRDNs (Blue Bell Creameries)/(J.P. Morgan Chase Bank, N.A. LOC), 3.750%, 6/1/2006	$	2,000,000
	2,500,000		Oklahoma Development Finance Authority, (Series 2002B), Weekly VRDNs (ConocoPhillips), 3.350%, 6/7/2006		2,500,000
	2,000,000		Oklahoma Development Finance Authority, (Series 2003), 3.45% TOBs (ConocoPhillips Co.)/(ConocoPhillips GTD), Optional Tender 12/1/2006		2,000,000
			TOTAL		6,500,000
			Oregon--0.6%
	1,000,000		Oregon State, (Series 194), Weekly VRDNs (Tillamook County Creamery Association)/(BNP Paribas SA LOC), 3.620%, 6/1/2006		1,000,000
	1,000,000		Oregon State, (Series 195), Weekly VRDNs (Columbia River Processing, Inc.)/(BNP Paribas SA LOC), 3.620%, 6/1/2006		1,000,000
			TOTAL		2,000,000
			Pennsylvania--3.1%
	895,000		McKean County, PA IDA, (Series 1997), Weekly VRDNs (Keystone Powdered Metal Co.)/(PNC Bank, N.A. LOC), 3.700%, 6/1/2006		895,000
	2,000,000		Pennsylvania EDFA, Wastewater Treatment Revenue Refunding Bonds (Series 2004B), Weekly VRDNs (Sunoco, Inc.), 3.440%, 6/7/2006		2,000,000
	3,700,000		Philadelphia, PA IDA Weekly VRDNs (30th Street Ltd. LP)/(MBIA Insurance Corp. INS)/(Royal Bank of Scotland PLC, Edinburgh LIQ), 4.000%, 6/7/2006		3,700,000
	3,700,000		Philadelphia, PA, (Series A of 2005-2006), 4.00% TRANs, 6/30/2006		3,703,521
			TOTAL		10,298,521
			South Carolina--2.0%
	1,800,000		Berkeley County, SC IDB Weekly VRDNs (Nucor Corp.), 3.270%, 6/7/2006		1,800,000
	3,800,000		Berkeley County, SC IDB, (Series 1998), Weekly VRDNs (Nucor Corp.), 3.270%, 6/7/2006		3,800,000
	860,000		South Carolina Jobs-EDA, (Series 2005A), Weekly VRDNs (Oconee Memorial Hospital, Inc.)/(Radian Asset Assurance INS)/(RBC Centura Bank LIQ), 3.530%, 6/1/2006		860,000
	185,000		South Carolina Jobs-EDA, EDRB (Series 1994), Weekly VRDNs (Carolina Cotton Works, Inc.)/(Branch Banking & Trust Co., Winston-Salem LOC), 3.570%, 6/1/2006		185,000
			TOTAL		6,645,000
Principal Amount					Value
			SHORT-TERM MUNICIPALS--continued^1,2
			South Dakota--4.5%
$	15,000,000	³	Clipper Tax-Exempt Certificates Trust (South Dakota-AMT), (Series 2005-9), Weekly VRDNs (South Dakota Housing Development Authority)/(State Street Bank and Trust Co. LIQ), 3.560%, 6/1/2006	$	15,000,000
			Tennessee--2.2%
	1,300,000		Franklin County, TN IDB, (Series 1997), Weekly VRDNs (Hi Tech)/(Regions Bank, Alabama LOC), 3.300%, 6/7/2006		1,300,000
	180,000		Hamilton County, TN IDB Weekly VRDNs (Pavestone Co.)/(J.P. Morgan Chase Bank, N.A. LOC), 3.750%, 6/1/2006		180,000
	2,500,000		Jackson, TN IDB, (Series 1999), Weekly VRDNs (Bobrick Washroom Equipment)/(Amsouth Bank N.A., Birmingham, AL LOC), 3.740%, 6/1/2006		2,500,000
	150,000		Knox County, TN IDB, (Series 1996), Weekly VRDNs (Health Ventures, Inc.)/(SunTrust Bank LOC), 3.520%, 6/1/2006		150,000
	3,100,000		Union City, TN IDB, (Series 1995), Weekly VRDNs (Kohler Co.)/(Wachovia Bank N.A. LOC), 3.630%, 6/1/2006		3,100,000
			TOTAL		7,230,000
			Texas--13.3%
	9,760,000	³	Bexar County, TX Housing Finance Corp., PT-2596 Weekly VRDNs (Rosemont Apartments)/(Merrill Lynch & Co., Inc. LIQ)/(WestLB AG (GTD) LOC), 3.600%, 6/1/2006		9,760,000
	980,000	³	Dallas-Fort Worth, TX International Airport, Roaring Forks (Series 2003-4), Weekly VRDNs (FSA, MBIA Insurance Corp. INS) and Bank of New York LIQs), 3.620%, 6/1/2006		980,000
	1,500,000		East Texas Housing Finance Corp., (Series 2002), Weekly VRDNs (The Park at Shiloh Apartments)/(Wachovia Bank N.A. LOC), 3.570%, 6/1/2006		1,500,000
	7,995,000	³	Garland, TX, Roaring Forks (Series 2005-2), Weekly VRDNs (FSA INS)/(Bank of New York LIQ), 3.550%, 6/1/2006		7,995,000
	5,695,000		Houston, TX Higher Education Finance Corp., (Series 2003A) Tierwester Oaks and Richfield Manor Weekly VRDNs (Houston Student Housing LLC)/(Bank of New York LOC), 3.850%, 6/1/2006		5,695,000
	4,730,000		Houston, TX Housing Finance Corp., (Series 2005), Weekly VRDNs (Fairlake Cove Apartments)/(Citibank N.A., New York LOC), 3.340%, 6/7/2006		4,730,000
	5,000,000		Port Arthur Navigation District, TX IDC, (Series 2000), Weekly VRDNs (Air Products & Chemicals, Inc.), 3.280%, 6/7/2006		5,000,000
Principal Amount					Value
			SHORT-TERM MUNICIPALS--continued^1,2
			Texas--continued
$	5,455,000	³	Port of Houston, TX, Roaring Forks (Series 2005-24), Weekly VRDNs (MBIA Insurance Corp. INS)/(Bank of New York LIQ), 3.620%, 6/1/2006	$	5,455,000
	3,295,000	³	Texas State Department of Housing & Community Affairs, MERLOTS (Series 2001-A109), Weekly VRDNs (GNMA COL)/(Wachovia Bank N.A. LIQ), 3.540%, 6/7/2006		3,295,000
			TOTAL		44,410,000
			Virginia--4.3%
	1,250,000	³	ABN AMRO MuniTOPS Certificates Trust (Virginia Non-AMT), (Series 1998-21), Weekly VRDNs (Norfolk, VA Water Revenue)/(FSA INS)/(ABN AMRO Bank NV, Amsterdam LIQ), 3.490%, 6/1/2006		1,250,000
	12,000,000		Henrico County, VA EDA, (Series 2003B), Weekly VRDNs (Westminster-Canterbury of Richmond)/(Branch Banking & Trust Co. of Virginia LOC), 3.480%, 6/1/2006		12,000,000
	945,000		Portsmouth, VA Redevelopment and Housing Authority, (Series 2000), Weekly VRDNs (Yorkshire Square Townhouse Apartments)/(SunTrust Bank LOC), 3.520%, 6/1/2006		945,000
			TOTAL		14,195,000
			Washington--3.8%
	5,305,000	³	Clark County, WA Public Utilities District No. 001, MERLOTS (Series 2001 A116), 3.35% TOBs (FSA INS)/(Wachovia Bank N.A. LIQ), Optional Tender 11/9/2006		5,305,000
	665,000		Washington State EDFA, (Series 2005B), Weekly VRDNs (Harold LeMay Enterprises, Inc.)/(Bank of America N.A. LOC), 3.290%, 6/7/2006		665,000
	2,000,000		Washington State Housing Finance Commission, (Series 1995), Weekly VRDNs (Heatherstone Apartments, LP)/(U.S. Bank, N.A. LOC), 3.560%, 6/1/2006		2,000,000
	2,575,000		Washington State Housing Finance Commission, (Series 1996A: Pacific Inn Apartments), Weekly VRDNs (225-112th NE LP)/(U.S. Bank, N.A. LOC), 3.570%, 6/1/2006		2,575,000
	2,250,000		Washington State Housing Finance Commission, (Series 1998A: Oxford Square Apartments), Weekly VRDNs (Oxford Housing LP)/(U.S. Bank, N.A. LOC), 3.570%, 6/1/2006		2,250,000
			TOTAL		12,795,000
Principal Amount					Value
			SHORT-TERM MUNICIPALS--continued^1,2
			Wisconsin--2.7%
$	2,000,000		Combined Locks, WI, Development Revenue Bonds, Series 1997 Weekly VRDNs (Appleton Papers)/(LaSalle Bank, N.A. LOC), 3.720%, 6/1/2006	$	2,000,000
	3,555,000		Lawrence, WI Weekly VRDNs (TPF Futures/Robinson Metals, Inc.)/(Marshall & Ilsley Bank, Milwaukee LOC), 3.640%, 6/1/2006		3,555,000
	500,000		Marshfield, WI, (Series 1993), Weekly VRDNs (Building Systems, Inc.)/(J.P. Morgan Chase Bank, N.A. LOC), 3.850%, 6/1/2006		500,000
	2,925,000		Mukwonago, WI, (Series 1999), Weekly VRDNs (Empire Level)/(Marshall & Ilsley Bank, Milwaukee LOC), 3.640%, 6/1/2006		2,925,000
			TOTAL		8,980,000
			TOTAL INVESTMENTS--100.4% (AT AMORTIZED COST)⁴		335,217,474
			OTHER ASSETS AND LIABILITIES - NET--(0.4)%		(1,216,874	)
			TOTAL NET ASSETS--100%	$	334,000,600

Securities that are subject to the federal alternative minimum tax (AMT) represent 72.3% of the portfolio as calculated based upon total market value (percentage is unaudited).

1 The Fund may only invest in securities rated in one of the two highest short-term rating categories by nationally recognized statistical rating organizations (NRSROs) or unrated securities of comparable quality. An NRSRO's two highest rating categories are determined without regard for sub-categories and gradations. For example, securities rated SP-1+, SP-1, or SP-2 by Standard & Poor's, MIG-1 or MIG-2 by Moody's Investors Service, or F-1+, F-1, or F-2 by Fitch Ratings, are all considered rated in one of the two highest short-term rating categories. Securities rated in the highest short-term rating category (and unrated securities of comparable quality) are identified as First Tier securities. Securities rated in the second highest short-term rating category (and unrated securities of comparable quality) are identified as Second Tier securities. The Fund follows applicable regulations in determining whether a security is rated and whether a security rated by multiple NRSROs in different rating categories should be identified as a First or Second Tier security. At May 31, 2006, the portfolio securities were rated as follows:

Tier Rating Percentages Based on Total Market Value (unaudited)

First Tier		Second Tier
95.4%		4.6%

2 Current rate and next reset date shown on Variable Rate Demand Notes.

3 Denotes a restricted security, including securities purchased under Rule 144A of the Securities Act of 1933. These securities, all of which have been deemed liquid by criteria approved by the Fund's Board of Directors, unless registered under the Act or exempted from registration, may only be sold to qualified institutional investors. At May 31, 2006, these securities amounted to $103,519,000 which represents 31.0% of total net assets.

4 Also represents cost for federal tax purposes.

Note: The categories of investments are shown as a percentage of total net assets at May 31, 2006.

The following acronyms are used throughout this portfolio:

AMBAC	- --American Municipal Bond Assurance Corporation
AMT	- --Alternative Minimum Tax
BANs	- --Bond Anticipation Notes
COL	- --Collateralized
CP	- --Commercial Paper
EDA	- --Economic Development Authority
EDFA	- --Economic Development Financing Authority
EDRB	- --Economic Development Revenue Bonds
FHLB	- --Federal Home Loan Bank
FHLMC	- --Federal Home Loan Mortgage Corporation
FSA	- --Financial Security Assurance
GNMA	- --Government National Mortgage Association
GTD	- --Guaranteed
HFA	- --Housing Finance Authority
IDA	- --Industrial Development Authority
IDB	- --Industrial Development Bond
IDC	- --Industrial Development Corporation
IDR	- --Industrial Development Revenue
IDRB(s)	- --Industrial Development Revenue Bond(s)
INS	- --Insured
LIQ	- --Liquidity Agreement
LOC	- --Letter of Credit
MERLOTS	- --Municipal Exempt Receipts -- Liquidity Optional Tender Series
MFH	- --Multi-Family Housing
PCR	- --Pollution Control Revenue
SWP	- --Swap Agreement
TOBs	- --Tender Option Bonds
TOPS	- --Trust Obligations Participating Securities
TRANs	- --Tax and Revenue Anticipation Notes
VRDNs	- --Variable Rate Demand Notes

See Notes which are an integral part of the Financial Statements

Statement of Assets and Liabilities

May 31, 2006

Assets:
Total investments in securities, at amortized cost and value			$	335,217,474
Income receivable				2,146,325
Receivable for shares sold				19,248
TOTAL ASSETS				337,383,047
Liabilities:
Payable for investments purchased	$	3,002,132
Payable for shares redeemed		7,493
Payable to bank		7,468
Payable for Directors'/Trustees' fees		875
Payable for distribution services fee (Note 5)		28,834
Payable for shareholder services fee (Note 5)		71,420
Income distribution payable		167,109
Accrued expenses		97,116
TOTAL LIABILITIES				3,382,447
Net assets for 334,006,951 shares outstanding			$	334,000,600
Net Assets Consist of:
Paid-in capital			$	334,004,655
Accumulated net realized loss on investments				(2,906	)
Distributions in excess of net investment income				(1,149	)
TOTAL NET ASSETS			$	334,000,600
Net Asset Value, Offering Price and Redemption Proceeds Per Share:
$334,000,600 ÷ 334,006,951 shares outstanding, $0.001 par value, 12,500,000,000 shares authorized				$1.00

See Notes which are an integral part of the Financial Statements

Statement of Operations

Year Ended May 31, 2006

Investment Income:
Interest							$	12,106,047
Expenses:
Investment adviser fee (Note 5)				$	2,033,563
Administrative personnel and services fee (Note 5)					324,095
Custodian fees					18,643
Transfer and dividend disbursing agent fees and expenses					471,302
Directors'/Trustees' fees					6,031
Auditing fees					13,151
Legal fees					8,646
Portfolio accounting fees					84,806
Distribution services fee (Note 5)					406,712
Shareholder services fee (Note 5)					1,016,742
Share registration costs					67,805
Printing and postage					30,765
Insurance premiums					9,636
Taxes					18,900
Miscellaneous					2,538
TOTAL EXPENSES					4,513,335
Waivers (Note 5):
Waiver of investment adviser fee	$	(213,055	)
Waiver of administrative personnel and services fee		(14,180	)
TOTAL WAIVERS					(227,235	)
Net expenses								4,286,100
Net investment income								7,819,947
Net realized gain on investments								4,197
Change in net assets resulting from operations							$	7,824,144

See Notes which are an integral part of the Financial Statements

Statement of Changes in Net Assets

Year Ended May 31		2006			2005
Increase (Decrease) in Net Assets
Operations:
Net investment income	$	7,819,947		$	2,808,303
Net realized gain (loss) on investments		4,197			(4,188	)
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS		7,824,144			2,804,115
Distributions to Shareholders:
Distributions from net investment income		(7,824,740	)		(2,804,761	)
Share Transactions:
Proceeds from sale of shares		1,518,554,603			1,256,920,314
Net asset value of shares issued to shareholders in payment of distributions declared		7,577,961			2,504,749
Cost of shares redeemed		(1,592,676,693	)		(1,212,352,494	)
CHANGE IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS		(66,544,129	)		47,072,569
Change in net assets		(66,544,725	)		47,071,923
Net Assets:
Beginning of period		400,545,325			353,473,402
End of period (including undistributed (distributions in excess of) net investment income of $(1,149) and $3,644, respectively)	$	334,000,600		$	400,545,325

See Notes which are an integral part of the Financial Statements

Notes to Financial Statements

May 31, 2006

1. ORGANIZATION

Cash Trust Series, Inc. (the "Corporation") is registered under the Investment Company Act of 1940, as amended (the "Act"), as an open-end management investment company. The Corporation consists of four portfolios. The financial statements included herein are only those of Municipal Cash Series (the "Fund"), a diversified portfolio. The financial statements of the other portfolios are presented separately. The assets of each portfolio are segregated and a shareholder's interest is limited to the portfolio in which shares are held. The investment objective of the Fund is to provide current income exempt from federal regular income tax consistent with stability of principal. Interest income from the Fund's investments may be subject to the federal alternative minimum tax for individuals and corporations and state and local taxes.

2. SIGNIFICANT ACCOUNTING POLICIES

Investment Valuation

The Fund uses the amortized cost method to value its portfolio securities in accordance with Rule 2a-7 under the Act.

Investment Income, Expenses and Distributions

Interest income and expenses are accrued daily. Distributions to shareholders are recorded on the ex-dividend date. Distributions of net investment income are declared daily and paid monthly.

Premium and Discount Amortization

All premiums and discounts are amortized/accreted.

Federal Taxes

Other Taxes

When-Issued and Delayed Delivery Transactions

Restricted Securities

Restricted securities are securities that may only be resold upon registration under federal securities laws or in transactions exempt from such registration. Many restricted securities may be resold in the secondary market in transactions exempt from registration. In some cases, the restricted securities may be resold without registration upon exercise of a demand feature. Such restricted securities may be determined to be liquid under criteria established by the Board of Directors (the "Directors"). The Fund will not incur any registration costs upon such resales. Restricted securities are valued at amortized cost in accordance with Rule 2a-7 under the Act.

Use of Estimates

Other

Investment transactions are accounted for on a trade date basis. Realized gains and losses from investment transactions are recorded on an identified cost basis.

3. CAPITAL STOCK

The following table summarizes capital stock activity:

Year Ended May 31	2006		2005
Shares sold	1,518,554,603		1,256,920,314
Shares issued to shareholders in payment of distributions declared	7,577,961		2,504,749
Shares redeemed	(1,592,676,693	)	(1,212,352,494	)
NET CHANGE RESULTING FROM SHARE TRANSACTIONS	(66,544,129	)	47,072,569

4. FEDERAL TAX INFORMATION

The tax character of distributions as reported on the Statement of Changes in Net Assets for the
years ended May 31, 2006 and 2005 was as follows:

		2006		2005
Tax-exempt income		$7,824,740		$2,804,761

As of May 31, 2006, the components of distributable earnings on a tax basis were as follows:

Undistributed tax-exempt income	$	165,960
Capital loss carryforward	$	2,906
Other temporary adjustments	$	(167,109	)

At May 31, 2006, the Fund had a capital loss carryforward of $2,906, which will reduce the Fund's taxable income arising from future net realized gains on investments, if any, to the extent permitted by the Code and thus will reduce the amount of distributions to shareholders which would otherwise be necessary to relieve the Fund of any liability for federal income tax. Pursuant to the Code, such capital loss carryforward will expire in 2011. The Fund used capital loss carryforwards of $9 to offset taxable capital gains realized during the year ended May 31, 2006.

5. INVESTMENT ADVISER FEE AND OTHER TRANSACTIONS WITH AFFILIATES

Investment Adviser Fee

Administrative Fee

Maximum Administrative Fee		Average Aggregate Daily Net Assets of the Federated Funds
0.150%		on the first $5 billion
0.125%		on the next $5 billion
0.100%		on the next $10 billion
0.075%		on assets in excess of $20 billion

Distribution Services Fee

The Fund has adopted a Distribution Plan (the "Plan") pursuant to Rule 12b-1 under the Act. Under the terms of the Plan, the Fund will compensate Federated Securities Corp. (FSC), the principal distributor, from the daily net assets of the Fund's Shares to finance activities intended to result in the sale of these shares. The Plan provides that the Fund may incur distribution expenses of 0.35% of average daily net assets, annually, to compensate FSC. FSC may voluntarily choose to waive any portion of its fee. FSC can modify or terminate this voluntary waiver at any time at its sole discretion. When FSC receives fees, it may pay some or all of them to financial intemediaries whose customers purchase shares. For the year ended May 31, 2006, FSC did not retain any fees paid by the Fund.

Shareholder Services Fee

Interfund Transactions

During the year ended May 31, 2006, the Fund engaged in purchase and sale transactions with funds that have a common investment adviser (or affiliated investment advisers), common Directors/Trustees, and/or common Officers. These purchase and sale transactions complied with Rule 17a-7 under the Act and amounted to $1,001,632,000 and $1,208,294,000, respectively.

General

Certain of the Officers and Directors of the Fund are Officers and Directors or Trustees of the above companies.

6. LEGAL PROCEEDINGS

Beginning in October 2003, Federated Investors, Inc. and various subsidiaries there of (including the advisers and distributor for various investment companies, collectively, "Federated"), along with various investment companies sponsored by Federated ("Funds") were named as defendants in several class action lawsuits now pending in the United States District Court for the District of Maryland. The lawsuits were purportedly filed on behalf of people who purchased, owned and/or redeemed shares of Federated-sponsored mutual funds during specified periods beginning November 1, 1998. The suits are generally similar in alleging that Federated engaged in illegal and improper trading practices including market timing and late trading in concert with certain institutional traders, which allegedly caused financial injury to the mutual fund shareholders. These lawsuits began to be filed shortly after Federated's first public announcement that it had received requests for information on shareholder trading activities in the Funds from the Securities and Exchange Commission ("SEC"), the Office of the New York State Attorney General ("NYAG"), and other authorities. In that regard, on November 28, 2005, Federated announced that it had reached final settlements with the SEC and the NYAG with respect to those matters. As Federated previously reported in 2004, it has already paid approximately $8.0 million to certain funds as determined by an independent consultant. As part of these settlements, Federated agreed to pay for the benefit of fund shareholders additional disgorgement and a civil money penalty in the aggregate amount of an additional $72 million. Federated and various Funds have also been named as defendants in several additional lawsuits, the majority of which are now pending in the United States District Court for the Western District of Pennsylvania, alleging, among other things, excessive advisory and Rule 12b-1 fees. The Board of the Funds has retained the law firm of Dickstein Shapiro LLP to represent the Funds in these lawsuits. Federated and the Funds, and their respective counsel, are reviewing the allegations and intend to defend this litigation. Additional lawsuits based upon similar allegations may be filed in the future. The potential impact of these lawsuits, all of which seek unquantified damages, attorneys' fees and expenses, and future potential similar suits is uncertain. Although we do not believe that these lawsuits will have a material adverse effect on the Funds, there can be no assurance that these suits, the ongoing adverse publicity and/or other developments resulting from the regulatory investigations will not result in increased Fund redemptions, reduced sales of Fund shares, or other adverse consequences for the Funds.

7. CHANGE IN INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

On May 20, 2005, the Fund's Directors, upon the recommendation of the Audit Committee and completion of the audit for May 31, 2005, appointed Ernst & Young LLP (E&Y) as the Fund's independent registered public accounting firm. The Fund's previous independent registered public accounting firm, Deliotte & Touche LLP (D&T), declined to stand for re-election. The previous reports issued by D&T on the Fund's financial statements for the fiscal years ended May 31, 2004 and May 31, 2005, contained no adverse opinion or disclaimer of opinion nor were they qualified or modified as to uncertainty, audit scope or accounting principles. During the Fund's fiscal years ended May 31, 2004 and May 31, 2005: (i) there were no disagreements with D&T on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of D&T, would have caused it to make reference to the subject matter of the disagreements in connection with its reports on the financial statements for such years; and (ii) there were no reportable events of the kind described in Item 304(a) (1) (v) of Regulation S-K under the Securities Exchange Act of 1934, as amended.

As indicated above, the Fund has appointed E&Y as the independent registered public accounting firm to audit the Fund's financial statements for the fiscal year ended May 31, 2006. During the Fund's fiscal years ended May 31, 2004 and May 31, 2005, and the interim period commencing June 1, 2005 and ending July 19, 2005, neither the Fund nor anyone on its behalf consulted E&Y on items which: (i) concerned the application of accounting principles to a specified transaction, either completed or proposed, or the type of audit opinion that might be rendered on the Fund's financial statements; or (ii) concerned the subject of a disagreement (as defined in paragraph (a) (1) (iv) of Item 304 of Regulation S-K) or reportable events (as described in paragraph (a) (1) (v) of said Item 304).

8. FEDERAL TAX INFORMATION (UNAUDITED)

At May 31, 2006, 100% of the distributions from net investment income is exempt from federal income tax, other than the federal AMT.

Report of Independent Registered Public Accounting Firm

TO THE BOARD OF DIRECTORS OF CASH TRUST SERIES, INC. AND THE SHAREHOLDERS OF MUNICIPAL CASH SERIES:

We have audited the accompanying statement of assets and liabilities of Municipal Cash Series (the "Fund") (one of the portfolios constituting Cash Trust Series, Inc.), including the portfolio of investments, as of May 31, 2006, and the related statements of operations, changes in net assets, and the financial highlights for the year then ended. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audit. The statement of changes in net assets for the year ended May 31, 2005 and the financial highlights for each of the four years in the period then ended were audited by another independent registered public accounting firm whose report, dated July 19, 2005, expressed an unqualified opinion on that statement and those financial highlights.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Municipal Cash Series, a portfolio of Cash Trust Series, Inc., at May 31, 2006, the results of its operations, the changes in its net assets and the financial highlights for the year then ended, in conformity with U.S. generally accepted accounting principles.

Ernst & Young LLP

Boston, Massachusetts

July 14, 2006

Board of Directors and Corporation Officers

INTERESTED DIRECTORS BACKGROUND


Name Birth Date Address Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s)
John F. Donahue* Birth Date: July 28, 1924 DIRECTOR Began serving: May 1989		Principal Occupations : Director or Trustee of the Federated Fund Complex; Chairman and Director, Federated Investors, Inc.; Chairman of the Federated Fund Complex's Executive Committee. Previous Positions : Chairman of the Federated Fund Complex; Trustee, Federated Investment Management Company and Chairman and Director, Federated Investment Counseling.

J. Christopher Donahue* Birth Date: April 11, 1949 PRESIDENT AND DIRECTOR Began serving: May 1989		Principal Occupations : Principal Executive Officer and President of the Federated Fund Complex; Director or Trustee of some of the Funds in the Federated Fund Complex; President, Chief Executive Officer and Director, Federated Investors, Inc.; Chairman and Trustee, Federated Investment Management Company; Trustee, Federated Investment Counseling; Chairman and Director, Federated Global Investment Management Corp.; Chairman, Passport Research, Ltd. (Investment advisory subsidiary of Federated); Trustee, Federated Shareholder Services Company; Director, Federated Services Company. Previous Positions : President, Federated Investment Counseling; President and Chief Executive Officer, Federated Investment Management Company, Federated Global Investment Management Corp. and Passport Research, Ltd.


Name Birth Date Address Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s)
Lawrence D. Ellis, M.D.* Birth Date: October 11, 1932 3471 Fifth Avenue Suite 1111 Pittsburgh, PA DIRECTOR Began serving: May 1989		Principal Occupations : Director or Trustee of the Federated Fund Complex; Professor of Medicine, University of Pittsburgh; Medical Director, University of Pittsburgh Medical Center Downtown; Hematologist, Oncologist and Internist, University of Pittsburgh Medical Center. Other Directorships Held : Member, National Board of Trustees, Leukemia Society of America. Previous Positions : Trustee, University of Pittsburgh; Director, University of Pittsburgh Medical Center.

INDEPENDENT DIRECTORS BACKGROUND


Name Birth Date Address Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s)
Thomas G. Bigley Birth Date: February 3, 1934 15 Old Timber Trail Pittsburgh, PA DIRECTOR Began serving: November 1994		Principal Occupation : Director or Trustee of the Federated Fund Complex. Other Directorships Held : Director, Member of Executive Committee, Children's Hospital of Pittsburgh; Director, University of Pittsburgh. Previous Position : Senior Partner, Ernst & Young LLP.

John T. Conroy, Jr. Birth Date: June 23, 1937 Investment Properties Corporation 3838 North Tamiami Trail Suite 402 Naples, FL DIRECTOR Began serving: August 1991		Principal Occupations : Director or Trustee of the Federated Fund Complex; Chairman of the Board, Investment Properties Corporation; Partner or Trustee in private real estate ventures in Southwest Florida. Previous Positions : President, Investment Properties Corporation; Senior Vice President, John R. Wood and Associates, Inc., Realtors; President, Naples Property Management, Inc. and Northgate Village Development Corporation.


Name Birth Date Address Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s)
Nicholas P. Constantakis Birth Date: September 3, 1939 175 Woodshire Drive Pittsburgh, PA DIRECTOR Began serving: February 1998		Principal Occupation : Director or Trustee of the Federated Fund Complex. Other Directorships Held : Director and Member of the Audit Committee, Michael Baker Corporation (engineering and energy services worldwide). Previous Position : Partner, Andersen Worldwide SC.

John F. Cunningham Birth Date: March 5, 1943 353 El Brillo Way Palm Beach, FL DIRECTOR Began serving: January 1999		Principal Occupation : Director or Trustee of the Federated Fund Complex; Director, WinsorTech. Other Directorships Held : Chairman, President and Chief Executive Officer, Cunningham & Co., Inc. (strategic business consulting); Trustee Associate, Boston College. Previous Positions : Director, Redgate Communications and EMC Corporation (computer storage systems); Chairman of the Board and Chief Executive Officer, Computer Consoles, Inc.; President and Chief Operating Officer, Wang Laboratories; Director, First National Bank of Boston; Director, Apollo Computer, Inc.

Peter E. Madden Birth Date: March 16, 1942 One Royal Palm Way 100 Royal Palm Way Palm Beach, FL DIRECTOR Began serving: August 1991		Principal Occupation : Director or Trustee of the Federated Fund Complex. Other Directorships Held : Board of Overseers, Babson College. Previous Positions : Representative, Commonwealth of Massachusetts General Court; President, State Street Bank and Trust Company and State Street Corporation (retired); Director, VISA USA and VISA International; Chairman and Director, Massachusetts Bankers Association; Director, Depository Trust Corporation; Director, The Boston Stock Exchange.

Charles F. Mansfield, Jr. Birth Date: April 10, 1945 80 South Road Westhampton Beach, NY DIRECTOR Began serving: January 1999		Principal Occupations : Director or Trustee of the Federated Fund Complex; Management Consultant. Previous Positions : Chief Executive Officer, PBTC International Bank; Partner, Arthur Young & Company (now Ernst & Young LLP); Chief Financial Officer of Retail Banking Sector, Chase Manhattan Bank; Senior Vice President, HSBC Bank USA (formerly, Marine Midland Bank); Vice President, Citibank; Assistant Professor of Banking and Finance, Frank G. Zarb School of Business, Hofstra University; Executive Vice President, DVC Group, Inc.


Name Birth Date Address Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s)
John E. Murray, Jr., J.D., S.J.D. Birth Date: December 20, 1932 Chancellor, Duquesne University Pittsburgh, PA DIRECTOR Began serving: February 1995		Principal Occupations : Director or Trustee, and Chairman of the Board of Directors or Trustees, of the Federated Fund Complex; Chancellor and Law Professor, Duquesne University; Partner, Murray, Hogue & Lannis. Other Directorships Held : Director, Michael Baker Corp. (engineering, construction, operations and technical services). Previous Positions : President, Duquesne University; Dean and Professor of Law, University of Pittsburgh School of Law; Dean and Professor of Law, Villanova University School of Law.

Marjorie P. Smuts Birth Date: June 21, 1935 4905 Bayard Street Pittsburgh, PA DIRECTOR Began serving: May 1989		Previous Positions : President, Duquesne University; Dean and Professor of Law, University of Pittsburgh School of Law; Dean and Professor of Law, Villanova University School of Law. Principal Occupations : Director or Trustee of the Federated Fund Complex; Public Relations/Marketing Consultant/Conference Coordinator. Previous Positions : National Spokesperson, Aluminum Company of America; television producer; President, Marj Palmer Assoc.; Owner, Scandia Bord.

John S. Walsh Birth Date: November 28, 1957 2604 William Drive Valparaiso, IN DIRECTOR Began serving: January 1999		Principal Occupations : Director or Trustee of the Federated Fund Complex; President and Director, Heat Wagon, Inc. (manufacturer of construction temporary heaters); President and Director, Manufacturers Products, Inc. (distributor of portable construction heaters); President, Portable Heater Parts, a division of Manufacturers Products, Inc. Previous Position : Vice President, Walsh & Kelly, Inc.

James F. Will Birth Date: October 12, 1938 Saint Vincent College Latrobe, PA DIRECTOR Began serving: April 2006		Principal Occupations : Director or Trustee of the Federated Fund Complex; Vice Chancellor and President, Saint Vincent College Other Directorships Held : Alleghany Corporation. Previous Positions : Chairman, President and Chief Executive Officer, Armco, Inc.; President and Chief Executive Officer, Cyclops Industries; President and Chief Operating Officer, Kaiser Steel Corporation.

OFFICERS


Name Birth Date Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years and Previous Position(s)
John W. McGonigle Birth Date: October 26, 1938 EXECUTIVE VICE PRESIDENT AND SECRETARY Began serving: May 1989		Principal Occupations : Executive Vice President and Secretary of the Federated Fund Complex; Vice Chairman, Executive Vice President, Secretary and Director, Federated Investors, Inc. Previous Positions : Trustee, Federated Investment Management Company and Federated Investment Counseling; Director, Federated Global Investment Management Corp., Federated Services Company and Federated Securities Corp.

Richard A. Novak Birth Date: December 25, 1963 TREASURER Began serving: January 2006		Principal Occupations : Principal Financial Officer and Treasurer of the Federated Fund Complex; Senior Vice President, Federated Administrative Services; Financial and Operations Principal for Federated Securities Corp., Edgewood Services, Inc. and Southpointe Distribution Services, Inc. Previous Positions : Vice President, Finance of Federated Services Company; held various financial management positions within The Mercy Hospital of Pittsburgh; Auditor, Arthur Andersen & Co.

Richard B. Fisher Birth Date: May 17, 1923 VICE CHAIRMAN Began serving: August 2002		Principal Occupations : Vice Chairman or Vice President of some of the Funds in the Federated Fund Complex; Vice Chairman, Federated Investors, Inc.; Chairman, Federated Securities Corp. Previous Positions : President and Director or Trustee of some of the Funds in the Federated Fund Complex; Executive Vice President, Federated Investors, Inc. and Director and Chief Executive Officer, Federated Securities Corp.

Brian P. Bouda Birth Date: February 28, 1947 SENIOR VICE PRESIDENT AND CHIEF COMPLIANCE OFFICER Began serving: August 2004		Principal Occupations : Senior Vice President and Chief Compliance Officer of the Federated Fund Complex; Vice President and Chief Compliance Officer of Federated Investors, Inc.; and Chief Compliance Officer of its subsidiaries. Mr. Bouda joined Federated in 1999 and is a member of the American Bar Association and the State Bar Association of Wisconsin.


Name Birth Date Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years and Previous Position(s)
Deborah A. Cunningham Birth Date: September 15, 1959 CHIEF INVESTMENT OFFICER Began serving: May 2004		Principal Occupations : Deborah A. Cunningham was named Chief Investment Officer of money market products in 2004 and is a Vice President of the Corporation. She joined Federated in 1981 and has been a Senior Portfolio Manager and a Senior Vice President of the Fund's Adviser since 1997. Ms. Cunningham is a Chartered Financial Analyst and received her M.S.B.A. in Finance from Robert Morris College.

Mary Jo Ochson Birth Date: September 12, 1953 VICE PRESIDENT Began serving: November 1998		Principal Occupations : Mary Jo Ochson has been the Fund's Portfolio Manager since August 1989. She was named Chief Investment Officer of tax-exempt, fixed-income products in 2004 and is a Vice President of the Corporation. She joined Federated in 1982 and has been a Senior Portfolio Manager and a Senior Vice President of the Fund's Adviser since 1996. Ms. Ochson is a Chartered Financial Analyst and received her M.B.A. in Finance from the University of Pittsburgh.

Evaluation and Approval of Advisory Contract

MUNICIPAL CASH SERIES (THE "FUND")

With respect to the Fund's performance and expenses in particular, the Board has found the use of comparisons to other mutual funds with comparable investment programs to be particularly useful, given the high degree of competition in the mutual fund business. The Board focused on comparisons with other similar mutual funds more heavily than non-mutual fund products or services because, simply put, they are more relevant. For example, other mutual funds are the products most like the Fund, they are readily available to Fund shareholders as alternative investment vehicles, and they are the type of investment vehicle in fact chosen and maintained by the Fund's investors. The range of their fees and expenses therefore appears to be a generally reliable indication of what consumers have found to be reasonable in the precise marketplace in which the Fund competes. The Fund's ability to deliver competitive performance when compared to its peer group was a useful indicator of how the Adviser is executing the Fund's investment program, which in turn assisted the Board in reaching a conclusion that the nature, extent, and quality of the Adviser's investment management services were such as to warrant continuation of the advisory contract. In this regard, the Senior Officer has reviewed Federated's fees for providing advisory services to products outside the Federated family of funds (e.g., institutional and separate accounts). He concluded that mutual funds and institutional accounts are inherently different products. Those differences included, but are not limited to targeting different investors, being subject to different laws and regulations, different legal structure, distribution costs, average account size and portfolio management techniques made necessary by different cash flows. The Senior Officer did not consider these fee schedules to be significant in determining the appropriateness of mutual fund advisory contracts.

The Fund's performance fell below the median of the relevant peer group during the year ending December 31, 2005. The Board discussed the Fund's performance with the Adviser and recognized the efforts being undertaken by the Adviser. The Board will continue to monitor these efforts and the performance of the Fund.

During the year ending December 31, 2005, the Fund's investment advisory fee after waivers and expense reimbursements, if any, was above the median of the relevant peer group.

At the Senior Officer's recommendation, the Board reviewed the fees and other expenses of the Fund with the Adviser and the Adviser noted the higher costs of services offered to shareholders and other expenses associated with the fund. The Board was satisfied that the overall expense structure of the Fund remained competitive. The Board will continue to monitor advisory fees and other expenses borne by the Fund.

Voting Proxies on Fund Portfolio Securities

Quarterly Portfolio Schedule

Federated
World-Class Investment Manager

Municipal Cash Series
Federated Investors Funds
5800 Corporate Drive
Pittsburgh, PA 15237-7000
Contact us at FederatedInvestors.com
or call 1-800-341-7400.

Federated Securities Corp., Distributor

Cusip 147551303

28565 (7/06)

Federated is a registered mark of Federated Investors, Inc. 2006 (c)Federated Investors, Inc.

Federated
World-Class Investment Manager

Prime Cash Series

A Portfolio of Cash Trust Series, Inc.

ANNUAL SHAREHOLDER REPORT

May 31, 2006

Not FDIC Insured * May Lose Value * No Bank Guarantee

Federated Investors 50 Years of Growth & Innovation

Financial Highlights

(For a Share Outstanding Throughout Each Period)

Year Ended May 31	2006	¹	2005		2004		2003		2002
Net Asset Value, Beginning of Period	$1.00		$1.00		$1.00		$1.00		$1.00
Income From Investment Operations:
Net investment income	0.031		0.011		0.001		0.007		0.019
Less Distributions:
Distributions from net investment income	(0.031	)	(0.011	)	(0.001	)	(0.007	)	(0.019	)
Net Asset Value, End of Period	$1.00		$1.00		$1.00		$1.00		$1.00
Total Return²	3.15	%	1.08	%	0.14	%	0.69	%	1.95	%

Ratios to Average Net Assets:
Net expenses	1.05	%	1.05	%	1.05	%	1.05	%	1.05	%
Net investment income	3.07	%	1.11	%	0.14	%	0.70	%	1.94	%
Expense waiver/reimbursement³	0.02	%	0.02	%	0.03	%	0.03	%	0.02	%
Supplemental Data:
Net assets, end of period (000 omitted)	$3,850,411		$4,074,633		$4,334,861		$5,008,970		$5,621,516

1 Beginning with the year ended May 31, 2006, the Fund was audited by Ernst & Young LLP. The previous years were audited by another independent registered public accounting firm.

2 Based on net asset value. Total returns for periods of less than one year, if any, are not annualized.

3 This expense decrease is reflected in both the net expense and the net investment income ratios shown above.

See Notes which are an integral part of the Financial Statements

Shareholder Expense Example

As a shareholder of the Fund, you incur ongoing costs, including management fees: to the extent applicable, distribution (12b-1) fees and/or shareholder services fees; and other Fund expenses. This Example is intended to help you to 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. It is based on an investment of $1,000 invested at the beginning of the period and held for the entire period from December 1, 2005 to May 31, 2006.

ACTUAL EXPENSES

HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES

	Beginning Account Value 12/1/2005	Ending Account Value 5/31/2006	Expenses Paid During Period¹
Actual	$1,000	$1,018.10	$5.28
Hypothetical (assuming a 5% return before expenses)	$1,000	$1,019.70	$5.29

1 Expenses are equal to the Fund's annualized net expense ratio of 1.05%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).

Portfolio of Investments Summary Tables

At May 31, 2006, the Fund's portfolio composition¹was as follows:

Security Type		Percentage of Total Net Assets
Commercial Paper & Notes		50.6%
Variable Rate Demand Instruments		37.4%
Repurchase Agreements		0.8%
Bank Instruments		11.0%
Other Assets and Liabilities--Net²		0.2%
TOTAL		100.0%

At May 31, 2006, the Fund's effective maturity³ schedule was as follows:

Securities With an Effective Maturity of:		Percentage of Total Net Assets
1-7 Days		43.2%
8-30 Days		28.6%
31-90 Days		18.6%
91-180 Days		4.9%
181 Days or more		4.7%
TOTAL		100.0%

1 Commercial paper and notes includes any fixed-rate security that is not a bank instrument. A variable rate demand instrument is any security which has an interest rate that resets periodically. See the Fund's Prospectus for descriptions of commercial paper, repurchase agreements and bank instruments.

2 Assets, other than investments in securities, less liabilities. See Statement of Assets and Liabilities.

3 Effective maturity is determined in accordance with the requirements of Rule 2a-7 under the Investment Company Act of 1940, which regulates money market mutual funds.

Portfolio of Investments

May 31, 2006

Principal Amount				Value
			ASSET-BACKED SECURITIES--0.9%
			Finance - Automotive--0.7%
$	3,854,786	^1,2	Capital Auto Receivables Asset Trust 2006-1, Class A1, 4.642%, 2/15/2007	$	3,854,785
	10,000,000		CarMax Auto Owner Trust 2006-1, Class A1, 5.180%, 5/15/2007		10,000,000
	4,312,636	^1,2	Ford Credit Auto Owner Trust 2006-A, Class A1, 4.724%, 11/15/2006		4,312,636
	8,326,988		Hyundai Auto Receivables Trust 2006-A, Class A1, 4.838%, 3/15/2007		8,326,988
			TOTAL		26,494,409
			Finance - Equipment--0.2%
	3,018,348		CNH Equipment Trust 2005-B, Class A1, 3.908%, 10/6/2006		3,018,349
	4,349,053		CNH Equipment Trust 2006-A, Class A1, 4.989%, 4/5/2007		4,349,053
			TOTAL		7,367,402
			TOTAL ASSET-BACKED SECURITIES		33,861,811
			CERTIFICATES OF DEPOSIT--11.0%
			Banking--11.0%
	5,000,000		Barclays Bank PLC, 4.752%, 10/17/2006		5,000,046
	106,000,000		Calyon, Paris, 3.950% - 5.310%, 7/14/2006 - 4/19/2007		106,000,000
	18,000,000		Citizens Bank of Pennsylvania, 5.220%, 8/28/2006		18,000,000
	47,200,000		Credit Suisse, Zurich, 4.920% - 5.200%, 2/5/2007 - 3/29/2007		47,200,000
	10,000,000		Dexia Bank, Belgium, 4.305%, 9/29/2006		9,984,144
	15,000,000		HBOS Treasury Services PLC, 5.355%, 5/15/2007		15,000,000
	75,000,000		Royal Bank of Scotland PLC, Edinburgh, 4.397% - 4.800%, 10/4/2006 - 1/30/2007		74,999,667
	45,000,000		Societe Generale, Paris, 4.760% - 4.785%, 10/27/2006		45,000,298
	48,000,000		Svenska Handelsbanken, Stockholm, 3.885% - 4.045%, 7/5/2006 - 7/26/2006		48,000,282
	15,000,000		Washington Mutual Bank, 5.040%, 6/29/2006		15,000,000
	25,000,000	^1,2	WestLB AG, 5.050%, 6/26/2006		25,000,000
	13,000,000		Wilmington Trust Co., 5.125%, 8/2/2006		13,000,000
			TOTAL CERTIFICATES OF DEPOSIT		422,184,437
Principal Amount				Value
			COLLATERALIZED LOAN AGREEMENTS--23.3%
			Banking--12.1%
$	131,000,000		Credit Suisse First Boston LLC, 5.163%, 6/1/2006	$	131,000,000
	100,000,000		Deutsche Bank Securities, Inc., 5.193%, 6/1/2006		100,000,000
	75,000,000		Greenwich Capital Markets, Inc., 5.188%, 6/1/2006		75,000,000
	60,000,000		HSBC Securities (USA), Inc., 5.133%, 6/1/2006		60,000,000
	50,000,000		IXIS Financial Products Inc., 5.163%, 6/1/2006		50,000,000
	50,000,000		J.P. Morgan Securities, Inc., 5.173%, 6/1/2006		50,000,000
			TOTAL		466,000,000
			Brokerage--11.2%
	75,000,000		Bear Stearns & Co., Inc., 5.183%, 6/1/2006		75,000,000
	100,000,000		Citigroup Global Markets, Inc., 5.163%, 6/1/2006		100,000,000
	95,000,000		Goldman Sachs & Co., 5.133%, 6/1/2006		95,000,000
	60,000,000		Lehman Brothers, Inc., 5.213%, 6/1/2006		60,000,000
	50,000,000		Merrill Lynch & Co., Inc., 5.193%, 6/1/2006		50,000,000
	52,000,000		Morgan Stanley & Co., Inc., 5.163%, 6/1/2006		52,000,000
			TOTAL		432,000,000
			TOTAL COLLATERALIZED LOAN AGREEMENTS		898,000,000
			COMMERCIAL PAPER--23.7%³
			Aerospace / Auto--1.9%
	37,551,000	^1,2	Nissan Motor Acceptance Corp., (Nissan Motor Co., Ltd. SA), 5.060% - 5.080%, 6/1/2006 - 6/15/2006		37,518,314
	37,800,000	^1,2	Volkswagen of America, Inc., (GTD by Volkswagen AG), 5.060% - 5.095%, 6/7/2006 - 6/20/2006		37,744,109
			TOTAL		75,262,423
			Banking--3.8%
	50,000,000	^1,2	KBC Financial Products International Ltd., (GTD by KBC Bank N.V.), 4.960% - 5.100%, 7/20/2006 - 11/20/2006		49,261,447
	25,595,000	^1,2	Long Lane Master Trust IV, (Bank of America N.A. SWP), 4.560%, 7/12/2006		25,462,077
	46,294,000	^1,2	Picaros Funding LLC, (GTD by KBC Bank N.V.), 4.270% - 5.140%, 7/10/2006 - 2/13/2007		45,769,276
	25,000,000	^1,2	WestLB AG, 5.060%, 6/12/2006		24,961,347
			TOTAL		145,454,147
			Consumer Products--0.8%
	1,700,000		Clorox Co., 5.080%, 6/8/2006		1,698,321
	29,500,000	^1,2	Fortune Brands, Inc., 5.070% - 5.140%, 6/6/2006 - 7/19/2006		29,333,279
			TOTAL		31,031,600
Principal Amount				Value
			COMMERCIAL PAPER--continued³
			Electrical Equipment--0.8%
$	30,000,000		General Electric Co., 5.020%, 6/30/2006	$	29,878,683
	2,500,000		Whirlpool Corp., 5.100%, 6/23/2006		2,492,208
			TOTAL		32,370,891
			Finance - Automotive--5.9%
	37,359,000		DaimlerChrysler North America Holding Corp., 5.100% - 5.250%, 6/5/2006 - 8/14/2006		37,125,376
	135,000,000		FCAR Auto Loan Trust, A1+/P1 Series, 4.800% - 5.070%, 6/5/2006 - 8/7/2006		134,398,853
	55,050,000		FCAR Auto Loan Trust, A1/P1 Series, 4.600% - 5.030%, 6/14/2006 - 7/17/2006		54,873,298
			TOTAL		226,397,527
			Finance - Commercial--1.5%
	57,000,000		CIT Group, Inc., 4.970% - 5.110%, 7/17/2006 - 11/15/2006		56,289,748
			Finance - Equipment--0.4%
	9,800,000		John Deere Credit Ltd., (GTD by John Deere Capital Corp.), 5.070%, 6/22/2006		9,771,017
	7,250,000		John Deere Finance S.A., (GTD by John Deere Capital Corp.), 5.080%, 6/27/2006		7,223,401
			TOTAL		16,994,418
			Finance - Retail--2.6%
	95,000,000	^1,2	Paradigm Funding LLC, 5.020% - 5.025%, 6/13/2006 - 6/19/2006		94,799,125
	7,000,000	^1,2	Tulip Funding Corp., 5.110%, 10/24/2006		6,855,926
			TOTAL		101,655,051
			Finance - Securities--3.5%
	12,100,000	^1,2	Beta Finance, Inc., 4.980%, 7/24/2006		12,011,286
	10,000,000	^1,2	Galaxy Funding Inc., 5.040%, 8/4/2006		9,910,400
	20,000,000	^1,2	Grampian Funding LLC, 4.590% - 5.040%, 7/21/2006 - 8/7/2006		19,842,450
	95,451,000	^1,2	KLIO II Funding Ltd., 5.030% - 5.040%, 6/19/2006 - 6/23/2006		95,173,548
			TOTAL		136,937,684
			Food & Beverage--1.3%
	3,893,000	^1,2	General Mills, Inc., 5.070%, 6/13/2006		3,886,421
	22,728,000	^1,2	H.J. Heinz Finance Co., (H.J. Heinz Co. LOC), 5.080% - 5.120%, 6/6/2006 - 6/21/2006		22,706,075
	22,000,000	^1,2	Sara Lee Corp., 5.070% - 5.080%, 6/7/2006 - 6/13/2006		21,966,140
			TOTAL		48,558,636
			Machinery, Equipment, Auto--1.2%
	45,000,000		John Deere Capital Corp., (Deere & Co. SA), 5.060%, 6/23/2006		44,860,850
			TOTAL COMMERCIAL PAPER		915,812,975
Principal Amount				Value
			CORPORATE NOTES--1.6%
			Finance - Securities--1.6%
$	3,000,000	^1,2	Beta Finance, Inc., 4.010%, 7/25/2006	$	3,000,000
	30,000,000	^1,2	K2 (USA) LLC, (GTD by K2 Corp.), 5.000%, 3/12/2007		30,000,000
	27,000,000	^1,2	Sigma Finance, Inc., (GTD by Sigma Finance Corp.), 4.150% - 5.320%, 8/8/2006 - 4/19/2007		27,000,000
			TOTAL CORPORATE NOTES		60,000,000
			LOAN PARTICIPATION--1.1%
			Finance - Retail--1.1%
	41,000,000		Countrywide Home Loans, Inc., 5.040% - 5.070%, 6/1/2006 - 6/19/2006		41,000,000
			NOTES - VARIABLE--37.4%⁴
			Banking--19.1%
	5,060,000		35 N. Fourth Street Ltd., Series 2000, (Huntington National Bank, Columbus, OH LOC), 5.314%, 6/1/2006		5,060,000
	2,370,000		6380 Brackbill Associates LP, Series 2000, (Manufacturers & Traders Trust Co., Buffalo, NY LOC), 5.180%, 6/2/2006		2,370,000
	8,425,000		Alabama Incentives Financing Authority, Series 1999-C, (Wachovia Bank N.A. LOC), 5.090%, 6/1/2006		8,425,000
	3,999,000		American Health Care Centers, Inc., (Series 1998), (FirstMerit Bank, N.A. LOC), 5.130%, 6/1/2006		3,999,000
	4,500,000		American Manufacturing Co., Inc., (Wachovia Bank N.A. LOC), 5.230%, 6/1/2006		4,500,000
	68,000,000	^1,2	BNP Paribas SA, 5.051%, 6/26/2006		68,000,000
	3,175,000		BW Capps & Son, Inc., (Columbus Bank and Trust Co., GA LOC), 5.160%, 6/1/2006		3,175,000
	15,000,000		Barclays Bank PLC, 5.001%, 6/5/2006		14,999,756
	6,090,000		Bond Holdings LP, (Wachovia Bank N.A. LOC), 5.080%, 6/2/2006		6,090,000
	840,000		Boozer Lumber Co., (Wachovia Bank N.A. LOC), 5.230%, 6/2/2006		840,000
	310,000		C.W. Caldwell, Inc., Sweetbriar Assisted Living Facility, Project, (Huntington National Bank, Columbus, OH LOC), 5.314%, 6/1/2006		310,000
	7,710,000		Callaway Gardens Resort, Inc., (Columbus Bank and Trust Co., GA LOC), 5.314%, 6/1/2006		7,710,000
	1,449,000		Capital One Funding Corp., Series 1995-D, (JPMorgan Chase Bank, N.A. LOC), 5.090%, 6/1/2006		1,449,000
	475,000		Carpenter, Thomas E., (Series 1998), (Huntington National Bank, Columbus, OH LOC), 5.240%, 6/1/2006		475,000
	6,535,000		Central Penn, Inc., (Manufacturers & Traders Trust Co., Buffalo, NY LOC), 5.180%, 6/2/2006		6,535,000
	4,735,000		Columbus, GA Development Authority, Woodmont Properties, LLC, Series 2000, (Columbus Bank and Trust Co., GA LOC), 5.130%, 6/1/2006		4,735,000
Principal Amount				Value
			NOTES - VARIABLE--continued⁴
			Banking--continued
$	2,885,000		Crane Plastics Siding LLC, Series 2000, (JPMorgan Chase Bank, N.A. LOC), 5.130%, 6/1/2006	$	2,885,000
	15,000,000		Credit Suisse, Zurich, 5.038%, 7/17/2006		15,000,000
	930,000		Damascus Co. Ltd., (Series 1998), (Huntington National Bank, Columbus, OH LOC), 5.240%, 6/1/2006		930,000
	10,000,000	^1,2	DePfa Bank PLC, 4.920%, 6/15/2006		10,000,000
	2,200,000		Dewberry III LP, (Manufacturers & Traders Trust Co., Buffalo, NY LOC), 5.130%, 6/7/2006		2,200,000
	2,625,000		Engle Printing & Publishing, Series 2001, (Manufacturers & Traders Trust Co., Buffalo, NY LOC), 5.180%, 6/2/2006		2,625,000
	5,655,000		Frank Parsons Paper Co., Inc., SERIES 1999, (Manufacturers & Traders Trust Co., Buffalo, NY LOC), 5.180%, 6/2/2006		5,655,000
	6,230,000		Gannett Fleming, Inc., Series 2001, (Manufacturers & Traders Trust Co., Buffalo, NY LOC), 5.180%, 6/2/2006		6,230,000
	6,300,000		Gervais Street Associates, (Series 1998), (Wachovia Bank N.A. LOC), 5.130%, 6/7/2006		6,300,000
	585,000		Gettysburg Area IDA, Hanover Lantern, Inc. Project (Series 1998-B), (Manufacturers & Traders Trust Co., Buffalo, NY LOC), 5.180%, 6/7/2006		585,000
	1,925,000		Graywood Farms LLC, (Manufacturers & Traders Trust Co., Buffalo, NY LOC), 5.180%, 6/2/2006		1,925,000
	2,735,000		Great Southern Wood, Inc., (Wachovia Bank N.A. LOC), 5.130%, 6/2/2006		2,735,000
	6,810,000		Grob Systems, Inc., (Series 1998 & 1999), (Fifth Third Bank, Cincinnati LOC), 5.080%, 6/1/2006		6,810,000
	55,000,000		HBOS Treasury Services PLC, 5.000% - 5.072%, 6/1/2006 - 6/26/2006		55,000,000
	69,000,000	^1,2	HBOS Treasury Services PLC, 5.045% - 5.259%, 6/9/2006 - 8/21/2006		69,000,000
	950,000		Hanna Steel Corp., (Wachovia Bank N.A. LOC), 5.180%, 6/2/2006		950,000
	4,505,000		Hodges Bonded Warehouse, Inc., Teague Warehouse Project, (Columbus Bank and Trust Co., GA LOC), 5.080%, 6/1/2006		4,505,000
	3,225,000		Iowa 80 Group, Inc., Series 2001, (Wells Fargo Bank, N.A. LOC), 4.920%, 6/1/2006		3,225,000
	7,610,000		Jackson-Rime Development Co. I, Series 2002, (First Commercial Bank, Birmingham, AL LOC), 5.090%, 6/1/2006		7,610,000
	2,290,000		Lake Sherwood Senior Living Center LLC, (Regions Bank, Alabama LOC), 5.160%, 6/1/2006		2,290,000
	50,000,000	¹	MONET Trust, Series 2000-1 Class A-2A, (Dresdner Bank AG, Frankfurt SWP), 5.034%, 6/28/2006		50,000,000
	2,925,000		Maryland State Economic Development Corp., CWI Limited Partnership, (Manufacturers & Traders Trust Co., Buffalo, NY LOC), 5.180%, 6/2/2006		2,925,000
	4,020,000		Maryland State Economic Development Corp., Human Genome Sciences Series 1999A, (Manufacturers & Traders Trust Co., Buffalo, NY LOC), 5.180%, 6/6/2006		4,020,000
Principal Amount				Value
			NOTES - VARIABLE--continued⁴
			Banking--continued
$	50,000,000		Maryland State Economic Development Corp., Series 2001A Human Genome Sciences, (Manufacturers & Traders Trust Co., Buffalo, NY LOC), 5.180%, 6/6/2006	$	50,000,000
	3,955,000		Memphis, TN Center City Revenue Finance Corp., South Bluffs Project (Series1998-A), (National Bank of Commerce, Memphis, TN LOC), 5.570%, 6/1/2006		3,955,000
	5,000,000	^1,2	National Australia Bank Ltd., Melbourne, 5.039%, 6/7/2006		5,000,000
	7,295,000		Oxmoor Partners LLC, (First Commercial Bank, Birmingham, AL LOC), 5.270%, 6/1/2006		7,295,000
	800,000		PV Communications, Inc., Series 1998, (Huntington National Bank, Columbus, OH LOC), 5.364%, 6/1/2006		800,000
	6,305,000		PVF Finance LLC, (Manufacturers & Traders Trust Co., Buffalo, NY LOC), 5.180%, 6/2/2006		6,305,000
	8,160,000		Remington Leasing LLC, (Manufacturers & Traders Trust Co., Buffalo, NY LOC), 5.231%, 6/2/2006		8,160,000
	25,000,000	^1,2	Royal Bank of Canada, Montreal, 4.992%, 6/1/2006		25,000,000
	460,000		Sandridge Food Corp., (National City Bank, OH LOC), 5.130%, 6/1/2006		460,000
	17,500,000		Sea Island Co., (Columbus Bank and Trust Co., GA LOC), 5.314%, 6/1/2006		17,500,000
	30,000,000	^1,2	Societe Generale, Paris, 4.992%, 6/2/2006		30,000,000
	3,100,000		Sojourn Project, Series 1997, (FirstMerit Bank, N.A. LOC), 5.130%, 6/1/2006		3,100,000
	8,335,000		Standing Boy Properties LLC, (Columbus Bank and Trust Co., GA LOC), 5.314%, 6/1/2006		8,335,000
	1,800,000		Stone Creek LLC, (Columbus Bank and Trust Co., GA LOC), 5.090%, 6/1/2006		1,800,000
	4,370,000		Sun Valley, Inc., (Wachovia Bank N.A. LOC), 5.080%, 6/2/2006		4,370,000
	2,735,000		Sussex County, DE, Rehoboth Mall Project, (Manufacturers & Traders Trust Co., Buffalo, NY LOC), 5.180%, 6/2/2006		2,735,000
	25,000,000		Svenska Handelsbanken, Stockholm, 5.020%, 6/20/2006		24,998,490
	2,430,000		Swiger Coil Systems, Inc., Series 2000, (Huntington National Bank, Columbus, OH LOC), 5.364%, 6/1/2006		2,430,000
	680,000		TDB Realty Ltd., (Huntington National Bank, Columbus, OH LOC), 5.264%, 6/1/2006		680,000
	2,980,000		Thetford Threesome LLC, (Columbus Bank and Trust Co., GA LOC), 5.210%, 6/1/2006		2,980,000
	16,575,000		Union Development Co., (Bank of America N.A. LOC), 5.050%, 6/1/2006		16,575,000
	20,000,000	^1,2	Union Hamilton Special Purpose Funding LLC, Series 2005-1 Tranche #1, (GTD by Wachovia Corp.), 4.930%, 6/21/2006		20,000,000
	856,431		Wauseon Manor II LP, (Huntington National Bank, Columbus, OH LOC), 5.314%, 6/1/2006		856,431
	38,000,000		Wells Fargo & Co., 5.072%, 6/2/2006		38,000,000
Principal Amount				Value
			NOTES - VARIABLE--continued⁴
			Banking--continued
$	48,000,000	^1,2	Westpac Banking Corp. Ltd., Sydney, 5.050%, 6/16/2006	$	48,000,000
	1,520,000		Wexner Heritage House, Series 2000, (Huntington National Bank, Columbus, OH LOC), 5.314%, 6/1/2006		1,520,000
	850,000		White Brothers Properties, Series 1996, (Huntington National Bank, Columbus, OH LOC), 5.314%, 6/1/2006		850,000
	960,000		YMCA of Central OH, (Huntington National Bank, Columbus, OH LOC), 5.314%, 6/1/2006		960,000
			TOTAL		734,742,677
			Brokerage--7.6%
	38,000,000		Goldman Sachs Group, Inc., 5.062%, 6/1/2006		38,004,301
	50,000,000	^1,2	Goldman Sachs Group, Inc., 5.100%, 6/15/2006		50,002,215
	35,000,000		Merrill Lynch & Co., Inc., 5.111%, 6/5/2006		35,000,000
	40,000,000	^1,2	Merrill Lynch & Co., Inc., 5.280%, 6/12/2006		40,000,000
	131,000,000		Morgan Stanley, 5.060% - 5.170%, 6/1/2006 - 6/27/2006		131,000,000
			TOTAL		294,006,516
			Finance - Commercial--2.3%
	85,300,000	^1,2	General Electric Capital Corp., 5.175% - 5.180%, 6/9/2006 - 6/19/2006		85,300,000
	3,000,000		South Carolina Jobs-EDA, Roller Bearing Co., Series 1994 B, (Heller Financial, Inc. LOC), 5.190%, 6/1/2006		3,000,000
			TOTAL		88,300,000
			Finance - Retail--2.9%
	31,000,000		AFS Insurance Premium Receivables Trust, (Series 1994-A), 5.636%, 6/15/2006		31,000,000
	25,000,000	^1,2	Compass Securitization LLC, 5.035%, 6/12/2006		24,999,857
	54,000,000	^1,2	Paradigm Funding LLC, 5.029% - 5.041%, 6/7/2006 - 6/26/2006		54,000,000
			TOTAL		109,999,857
			Finance - Securities--3.7%
	50,000,000	^1,2	Beta Finance, Inc., 5.189%, 8/22/2006		50,005,532
	25,000,000	^1,2	K2 (USA) LLC, (GTD by K2 Corp.), 5.035%, 6/12/2006		24,998,645
	69,000,000	^1,2	Sigma Finance, Inc., (GTD by Sigma Finance Corp.), 4.910% - 5.170%, 6/1/2006 - 7/25/2006		69,000,541
			TOTAL		144,004,718
			Government Agency--0.0%
	810,000		Clayton County, GA Housing Authority, Summerwinds Project, Series 2000 B, (Federal National Mortgage Association LOC), 5.210%, 6/1/2006		810,000
Principal Amount				Value
			NOTES - VARIABLE--continued⁴
			Insurance--1.8%
$	15,000,000		Genworth Life Insurance Co., 5.256%, 8/9/2006	$	15,000,000
	9,000,000		Hartford Life Global Funding Trust, 5.060%, 6/15/2006		9,000,000
	10,000,000		Jackson National Life Insurance Co., 5.122%, 6/1/2006		10,000,000
	35,000,000		Monumental Life Insurance Co., 5.366%, 8/31/2006		35,000,000
			TOTAL		69,000,000
			TOTAL NOTES - VARIABLE		1,440,863,768
			REPURCHASE AGREEMENT--0.8%
$	30,892,000		Interest in $1,750,000,000 joint repurchase agreement 5.050%, dated 5/31/2006, under which Credit Suisse First Boston Corp. will repurchase U.S. Government Agency securities with various maturities to 8/16/2043 for $1,750,245,486 on 6/1/2006. The market value of the underlying securities at the end of the period was $1,802,504,445.		30,892,000
			TOTAL INVESTMENTS--99.8% (AT AMORTIZED COST)⁵		3,842,614,991
			OTHER ASSETS AND LIABILITIES - NET--0.2%		7,795,936
			TOTAL NET ASSETS--100%	$	3,850,410,927

1 Denotes a restricted security, including securities purchased under Rule 144A of the Securities Act of 1933. These securities, unless registered under the Act or exempted from registration, may only be sold to qualified institutional investors. At May 31, 2006, these securities amounted to $1,353,675,431 which represents 35.2% of total net assets.

2 Denotes a restricted security, including securities purchased under Rule 144A that have been deemed liquid by criteria approved by the Fund's Board of Directors. At May 31, 2006, these securities amounted to $1,303,675,431 which represents 33.9% of total net assets.

3 Discount rate at time of purchase.

4 Floating rate note with current rate and next reset date shown.

5 Also represents cost for federal tax purposes.

Note: The categories of investments are shown as a percentage of total net assets at May 31, 2006.

The following acronyms are used throughout this portfolio:

EDA	- --Economic Development Authority
GTD	- --Guaranteed
IDA	- --Industrial Development Authority
LOC	- --Letter of Credit
SA	- --Support Agreement
SWP	- --Swap Agreement

See Notes which are an integral part of the Financial Statements

Statement of Assets and Liabilities

May 31, 2006

Assets:
Total investments in securities, at amortized cost and value			$	3,842,614,991
Cash				447,612
Income receivable				14,243,990
Receivable for shares sold				291,565
TOTAL ASSETS				3,857,598,158
Liabilities:
Payable for shares redeemed	$	749,050
Income distribution payable		4,708,424
Payable for transfer and dividend disbursing agent fees and expenses		447,065
Payable for distribution services fee (Note 5)		326,258
Payable for shareholder services fee (Note 5)		805,410
Accrued expenses		151,024
TOTAL LIABILITIES				7,187,231
Net assets for 3,850,417,353 shares outstanding			$	3,850,410,927
Net Assets Consist of:
Paid-in capital			$	3,850,417,353
Accumulated net realized gain on investments				84
Distributions in excess of net investment income				(6,510	)
TOTAL NET ASSETS			$	3,850,410,927
Net Asset Value, Offering Price and Redemption Proceeds Per Share:
($3,850,410,927 ÷ 3,850,417,353 shares outstanding) $0.001 par value, 12,500,000,000 shares authorized				$1.00

See Notes which are an integral part of the Financial Statements

Statement of Operations

Year Ended May 31, 2006

Investment Income:
Interest							$	177,493,580
Expenses:
Investment adviser fee (Note 5)				$	21,520,934
Administrative personnel and services fee (Note 5)					3,429,685
Custodian fees					223,857
Transfer and dividend disbursing agent fees and expenses					5,197,159
Directors'/Trustees' fees					31,718
Auditing fees					14,215
Legal fees					9,419
Portfolio accounting fees					164,318
Distribution services fee (Note 5)					4,304,187
Shareholder services fee (Note 5)					10,760,156
Share registration costs					302,849
Printing and postage					196,189
Insurance premiums					31,130
Taxes					213,050
Miscellaneous					16,669
TOTAL EXPENSES					46,415,535
Waivers (Note 5):
Waiver of investment adviser fee	$	(863,329	)
Waiver of administrative personnel and services fee		(149,895	)
TOTAL WAIVERS					(1,013,224	)
Net expenses								45,402,311
Net investment income								132,091,269
Net realized gain on investments								84
Change in net assets resulting from operations							$	132,091,353

See Notes which are an integral part of the Financial Statements

Statement of Changes in Net Assets

Year Ended May 31		2006			2005
Increase (Decrease) in Net Assets
Operations:
Net investment income	$	132,091,269		$	38,910,350
Net realized gain on investments		84			- --
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS		132,091,353			38,910,350
Distributions to Shareholders:
Distributions from net investment income		(132,106,792	)		(38,893,769	)
Share Transactions:
Proceeds from sale of shares		11,646,059,688			6,765,456,857
Net asset value of shares issued to shareholders in payment of distributions declared		127,008,452			35,958,841
Cost of shares redeemed		(11,997,275,205	)		(7,061,660,194	)
CHANGE IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS		(224,207,065	)		(260,244,496	)
Change in net assets		(224,222,504	)		(260,227,915	)
Net Assets:
Beginning of period		4,074,633,431			4,334,861,346
End of period (including undistributed net investment income (distributions in excess of net investment income) of $(6,510) and $9,013, respectively)	$	3,850,410,927		$	4,074,633,431

See Notes which are an integral part of the Financial Statements

Notes to Financial Statements

May 31, 2006

1. ORGANIZATION

Cash Trust Series, Inc. (the "Corporation") is registered under the Investment Company Act of 1940, as amended (the "Act"), as a diversified open-end management investment company. The Corporation consists of four portfolios. The financial statements included herein are only those of Prime Cash Series (the "Fund"). The financial statements of the other portfolios are presented separately. The assets of each portfolio are segregated and a shareholder's interest is limited to the portfolio in which shares are held. The primary investment objective of the Fund is to provide current income consistent with stability of principal and liquidity.

2. SIGNIFICANT ACCOUNTING POLICIES

Investment Valuation

The Fund uses the amortized cost method to value its portfolio securities in accordance with Rule 2a-7 under the Act.

Repurchase Agreements

The Fund may enter into repurchase agreements in which eligible securities are transferred into joint trading accounts maintained by the custodian or sub-custodian for investment companies and other clients advised by the Adviser and its affiliates. The Fund will participate on a pro rata basis with the other investment companies and clients in its share of the securities transferred under such repurchase agreements and in its share of proceeds from any repurchase or other disposition of such securities.

Investment Income, Expenses and Distributions

Interest income and expenses are accrued daily. Distributions to shareholders are recorded on the ex-dividend date. Distributions of net investment income are declared daily and paid monthly.

Premium and Discount Amortization

All premiums and discounts on fixed-income securities are amortized/accreted.

Federal Taxes

Other Taxes

When-Issued and Delayed Delivery Transactions

Restricted Securities

Restricted securities are securities that may only be resold upon registration under federal securities laws or in transactions exempt from such registration. Many restricted securities may be resold in the secondary market in transactions exempt from registration. In some cases, the restricted securities may be resold without registration upon exercise of a demand feature. Such restricted securities may be determined to be liquid under criteria established by the Fund's Board of Directors ("Directors"). The Fund will not incur any registration costs upon such resales. Restricted securities are valued at amortized cost in accordance with Rule 2a-7 under the Act.

Additional information on restricted securities, excluding securities purchased under Rule 144A that have been deemed liquid by the Directors, held at May 31, 2006, is as follows:

Security		Acquisition Date		Acquisition Cost
MONET Trust, Series 2000-1 Class A-2, (Dresdner Bank AG, Frankfurt Swap Agreement), 5.034%, 6/28/2006		3/28/2006		$50,000,000

Use of Estimates

Other

Investment transactions are accounted for on a trade date basis. Realized gains and losses from investment transactions are recorded on an identified cost basis.

3. CAPITAL STOCK

The following table summarizes capital stock activity:

Year Ended May 31	2006		2005
Shares sold	11,646,059,688		6,765,456,857
Shares issued to shareholders in payment of distributions declared	127,008,452		35,958,841
Shares redeemed	(11,997,275,205	)	(7,061,660,194	)
NET CHANGE RESULTING FROM SHARE TRANSACTIONS	(224,207,065	)	(260,244,496	)

4. FEDERAL TAX INFORMATION

The tax character of distributions as reported on the Statement of Changes in Net Assets for the years ended May 31, 2006 and 2005, was as follows:

		2006		2005
Ordinary income¹		$132,106,792		$38,893,769

1 For tax purposes short-term capital gain distributions are considered ordinary income distributions.

As of May 31, 2006, the components of distributable earnings on a tax basis were as follows:

Undistributed ordinary income		$	4,701,998
Other temporary adjustments		$	(4,708,423	)

5. INVESTMENT ADVISER FEE AND OTHER TRANSACTIONS WITH AFFILIATES

Investment Adviser Fee

Administrative Fee

Maximum Administrative Fee		Average Aggregate Daily Net Assets of the Federated Funds
0.150%		on the first $5 billion
0.125%		on the next $5 billion
0.100%		on the next $10 billion
0.075%		on assets in excess of $20 billion

Distribution Services Fee

The Fund has adopted a Distribution Plan (the "Plan") pursuant to Rule 12b-1 under the Act. Under the terms of the Plan, the Fund will compensate Federated Securities Corp. (FSC), the principal distributor, from the daily net assets of the Fund's shares to finance activities intended to result in the sale of these shares. The Plan provides that the Fund may incur distribution expenses of 0.35% of average daily net assets, annually, to compensate FSC. FSC may voluntarily choose to waive any portion of its fee. FSC can modify or terminate this voluntary waiver at any time at its sole discretion. When FSC receives fees, it may pay some or all of them to financial intermediaries whose customers purchase shares. For the year ended May 31, 2006, FSC did not retain any fees paid by the Fund.

Shareholder Services Fee

The Fund may pay fees (Service Fees) up to 0.25% of the average daily net assets of the Fund's Shares to financial intermediaries or to Federated Shareholder Services Company (FSSC), for providing services to shareholders and maintaining shareholder accounts. FSSC or these financial intermediaries may voluntarily choose to waive any portion of their fee. This voluntary waiver can be modified or terminated at any time. For the year ended May 31, 2006, FSSC received $25,626 of fees paid by the Fund.

General

Certain of the Officers and Directors of the Fund are Officers and Directors or Trustees of the above companies.

6. CONCENTRATION OF CREDIT RISK

A substantial part of the Fund's portfolio may be comprised of obligations of banks. As a result, the Fund may be more susceptible to any economic, business, political or other developments which generally affect these entities.

7. LEGAL PROCEEDINGS

Beginning in October 2003, Federated Investors, Inc. and various subsidiaries there of (including the advisers and distributor for various investment companies, collectively, "Federated"), along with various investment companies sponsored by Federated ("Funds") were named as defendants in several class action lawsuits now pending in the United States District Court for the District of Maryland. The lawsuits were purportedly filed on behalf of people who purchased, owned and/or redeemed shares of Federated-sponsored mutual funds during specified periods beginning November 1, 1998. The suits are generally similar in alleging that Federated engaged in illegal and improper trading practices including market timing and late trading in concert with certain institutional traders, which allegedly caused financial injury to the mutual fund shareholders. These lawsuits began to be filed shortly after Federated's first public announcement that it had received requests for information on shareholder trading activities in the Funds from the Securities and Exchange Commission ("SEC"), the Office of the New York State Attorney General ("NYAG"), and other authorities. In that regard, on November 28, 2005, Federated announced that it had reached final settlements with the SEC and the NYAG with respect to those matters. As Federated previously reported in 2004, it has already paid approximately $8.0 million to certain funds as determined by an independent consultant. As part of these settlements, Federated agreed to pay for the benefit of fund shareholders additional disgorgement and a civil money penalty in the aggregate amount of an additional $72 million. Federated and various Funds have also been named as defendants in several additional lawsuits, the majority of which are now pending in the United States District Court for the Western District of Pennsylvania, alleging, among other things, excessive advisory and Rule 12b-1 fees. The Board of the Funds has retained the law firm of Dickstein Shapiro LLP to represent the Funds in these lawsuits. Federated and the Funds, and their respective counsel, are reviewing the allegations and intend to defend this litigation. Additional lawsuits based upon similar allegations may be filed in the future. The potential impact of these lawsuits, all of which seek unquantified damages, attorneys' fees and expenses, and future potential similar suits is uncertain. Although we do not believe that these lawsuits will have a material adverse effect on the Funds, there can be no assurance that these suits, the ongoing adverse publicity and/or other developments resulting from the regulatory investigations will not result in increased Fund redemptions, reduced sales of Fund shares, or other adverse consequences for the Funds.

8. CHANGE IN INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

On May 20, 2005, the Fund's Directors, upon the recommendation of the Audit Committee, appointed Ernst & Young LLP (E&Y) as the Funds' independent registered public accounting firm. The Fund's previous independent registered public accounting firm, Deloitte & Touche LLP (D&T) declined to stand for re-election. The previous reports issued by D&T on the Fund's financial statements for the fiscal years ended May 31, 2004 and May 31, 2005 contained no adverse opinion or disclaimer of opinion nor were they qualified or modified as to uncertainty, audit scope or accounting principles. During the Fund's fiscal years ended May 31, 2004 and May 31, 2005: (i) there were no disagreements with D&T on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of D&T, would have caused it to make reference to the subject matter of the disagreements in connection with its reports on the financial statements for such years; and (ii) there were no reportable events of the kind described in Item 304(a) (1) (v) of Regulation S-K under the Securities Exchange Act of 1934, as amended.

As indicated above, the Fund has appointed E&Y as the independent registered public accounting firm to audit the Fund's financial statements for the fiscal year ending May 31, 2006. During the Fund's fiscal years ended May 31, 2004 and May 31, 2005 and the interim period commencing June 1, 2005 and ending July 19, 2005, neither the Fund nor anyone on its behalf has consulted E&Y on items which: (i) concerned the application of accounting principles to a specified transaction, either completed or proposed, or the type of audit opinion that might be rendered on the Fund's financial statements; or (ii) concerned the subject of a disagreement (as defined in paragraph (a) (1) (iv) of Item 304 of Regulation S-K) or reportable events (as described in paragraph (a) (1) (v) of said Item 304).

Report of Independent Registered Public Accounting Firm

TO THE BOARD OF DIRECTORS OF CASH TRUST SERIES, INC. AND THE SHAREHOLDERS OF PRIME CASH SERIES:

We have audited the accompanying statement of assets and liabilities of Prime Cash Series (the "Fund") (one of the portfolios constituting Cash Trust Series, Inc.), including the portfolio of investments, as of May 31, 2006, and the related statements of operations, changes in net assets, and the financial highlights for the year then ended. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audit. The statement of changes in net assets for the year ended May 31, 2005 and the financial highlights for each of the four years in the period then ended were audited by another independent registered public accounting firm whose report, dated July 19, 2005, expressed an unqualified opinion on that statement and those financial highlights.

We conducted our audit in accordance with 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 and financial highlights are free of material misstatement. We were not engaged to perform an audit of the Funds' internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of May 31, 2006, by correspondence with the custodian and brokers. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Prime Cash Series, a portfolio of Cash Trust Series, Inc., at May 31, 2006, the results of its operations, the changes in its net assets, and the financial highlights for the year then ended, in conformity with U.S. generally accepted accounting principles.

Ernst & Young LLP

Boston, Massachusetts
July 14, 2006

Board of Directors and Corporation Officers

The Board is responsible for managing the Corporation's business affairs and for exercising all the Corporation's powers except those reserved for the shareholders. The following tables give information about each Board member and the senior officers of the Fund. Where required, the tables separately list Board members who are "interested persons" of the Fund ( i.e. , "Interested" Board members) and those who are not ( i.e. , "Independent" Board members). Unless otherwise noted, the address of each person listed is Federated Investors Tower, 1001 Liberty Avenue, Pittsburgh, PA. As of December 31, 2005, the Corporation comprised four portfolios, and the Federated Fund Complex consisted of 43 investment companies (comprising 136 portfolios). Unless otherwise noted, each Officer is elected annually. Unless otherwise noted, each Board member oversees all portfolios in the Federated Fund Complex and serves for an indefinite term. The Fund's Statement of Additional Information includes additional information about Corporation Directors and is available, without charge and upon request, by calling 1-800-341-7400.

INTERESTED DIRECTORS BACKGROUND


Name Birth Date Address Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s)
John F. Donahue* Birth Date: July 28, 1924 DIRECTOR Began serving: May 1989		Principal Occupations : Director or Trustee of the Federated Fund Complex; Chairman and Director, Federated Investors, Inc.; Chairman of the Federated Fund Complex's Executive Committee. Previous Positions : Chairman of the Federated Fund Complex; Trustee, Federated Investment Management Company and Chairman and Director, Federated Investment Counseling.

J. Christopher Donahue* Birth Date: April 11, 1949 PRESIDENT AND DIRECTOR Began serving: May 1989		Principal Occupations : Principal Executive Officer and President of the Federated Fund Complex; Director or Trustee of some of the Funds in the Federated Fund Complex; President, Chief Executive Officer and Director, Federated Investors, Inc.; Chairman and Trustee, Federated Investment Management Company; Trustee, Federated Investment Counseling; Chairman and Director, Federated Global Investment Management Corp.; Chairman, Passport Research, Ltd. (Investment advisory subsidiary of Federated); Trustee, Federated Shareholder Services Company; Director, Federated Services Company. Previous Positions : President, Federated Investment Counseling; President and Chief Executive Officer, Federated Investment Management Company, Federated Global Investment Management Corp. and Passport Research, Ltd.


Name Birth Date Address Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s)
Lawrence D. Ellis, M.D.* Birth Date: October 11, 1932 3471 Fifth Avenue Suite 1111 Pittsburgh, PA DIRECTOR Began serving: May 1989		Principal Occupations : Director or Trustee of the Federated Fund Complex; Professor of Medicine, University of Pittsburgh; Medical Director, University of Pittsburgh Medical Center Downtown; Hematologist, Oncologist and Internist, University of Pittsburgh Medical Center. Other Directorships Held : Member, National Board of Trustees, Leukemia Society of America. Previous Positions : Trustee, University of Pittsburgh; Director, University of Pittsburgh Medical Center.

INDEPENDENT DIRECTORS BACKGROUND


Name Birth Date Address Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s)
Thomas G. Bigley Birth Date: February 3, 1934 15 Old Timber Trail Pittsburgh, PA DIRECTOR Began serving: November 1994		Principal Occupation : Director or Trustee of the Federated Fund Complex. Other Directorships Held : Director, Member of Executive Committee, Children's Hospital of Pittsburgh; Director, University of Pittsburgh. Previous Position : Senior Partner, Ernst & Young LLP.

John T. Conroy, Jr. Birth Date: June 23, 1937 Investment Properties Corporation 3838 North Tamiami Trail Suite 402 Naples, FL DIRECTOR Began serving: August 1991		Principal Occupations : Director or Trustee of the Federated Fund Complex; Chairman of the Board, Investment Properties Corporation; Partner or Trustee in private real estate ventures in Southwest Florida. Previous Positions : President, Investment Properties Corporation; Senior Vice President, John R. Wood and Associates, Inc., Realtors; President, Naples Property Management, Inc. and Northgate Village Development Corporation.


Name Birth Date Address Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s)
Nicholas P. Constantakis Birth Date: September 3, 1939 175 Woodshire Drive Pittsburgh, PA DIRECTOR Began serving: February 1998		Principal Occupation : Director or Trustee of the Federated Fund Complex. Other Directorships Held : Director and Member of the Audit Committee, Michael Baker Corporation (engineering and energy services worldwide). Previous Position : Partner, Andersen Worldwide SC.

John F. Cunningham Birth Date: March 5, 1943 353 El Brillo Way Palm Beach, FL DIRECTOR Began serving: January 1999		Principal Occupation : Director or Trustee of the Federated Fund Complex; Director, WinsorTech. Other Directorships Held : Chairman, President and Chief Executive Officer, Cunningham & Co., Inc. (strategic business consulting); Trustee Associate, Boston College. Previous Positions : Director, Redgate Communications and EMC Corporation (computer storage systems); Chairman of the Board and Chief Executive Officer, Computer Consoles, Inc.; President and Chief Operating Officer, Wang Laboratories; Director, First National Bank of Boston; Director, Apollo Computer, Inc.

Peter E. Madden Birth Date: March 16, 1942 One Royal Palm Way 100 Royal Palm Way Palm Beach, FL DIRECTOR Began serving: August 1991		Principal Occupation : Director or Trustee of the Federated Fund Complex. Other Directorships Held : Board of Overseers, Babson College. Previous Positions : Representative, Commonwealth of Massachusetts General Court; President, State Street Bank and Trust Company and State Street Corporation (retired); Director, VISA USA and VISA International; Chairman and Director, Massachusetts Bankers Association; Director, Depository Trust Corporation; Director, The Boston Stock Exchange.

Charles F. Mansfield, Jr. Birth Date: April 10, 1945 80 South Road Westhampton Beach, NY DIRECTOR Began serving: January 1999		Principal Occupations : Director or Trustee of the Federated Fund Complex; Management Consultant. Previous Positions : Chief Executive Officer, PBTC International Bank; Partner, Arthur Young & Company (now Ernst & Young LLP); Chief Financial Officer of Retail Banking Sector, Chase Manhattan Bank; Senior Vice President, HSBC Bank USA (formerly, Marine Midland Bank); Vice President, Citibank; Assistant Professor of Banking and Finance, Frank G. Zarb School of Business, Hofstra University; Executive Vice President, DVC Group, Inc.


Name Birth Date Address Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s)
John E. Murray, Jr., J.D., S.J.D. Birth Date: December 20, 1932 Chancellor, Duquesne University Pittsburgh, PA DIRECTOR Began serving: February 1995		Principal Occupations : Director or Trustee, and Chairman of the Board of Directors or Trustees, of the Federated Fund Complex; Chancellor and Law Professor, Duquesne University; Partner, Murray, Hogue & Lannis. Other Directorships Held : Director, Michael Baker Corp. (engineering, construction, operations and technical services). Previous Positions : President, Duquesne University; Dean and Professor of Law, University of Pittsburgh School of Law; Dean and Professor of Law, Villanova University School of Law.

Marjorie P. Smuts Birth Date: June 21, 1935 4905 Bayard Street Pittsburgh, PA DIRECTOR Began serving: May 1989		Principal Occupations : Director or Trustee of the Federated Fund Complex; Public Relations/Marketing Consultant/Conference Coordinator. Previous Positions : National Spokesperson, Aluminum Company of America; television producer; President, Marj Palmer Assoc.; Owner, Scandia Bord.

John S. Walsh Birth Date: November 28, 1957 2604 William Drive Valparaiso, IN DIRECTOR Began serving: January 1999		Principal Occupations : Director or Trustee of the Federated Fund Complex; President and Director, Heat Wagon, Inc. (manufacturer of construction temporary heaters); President and Director, Manufacturers Products, Inc. (distributor of portable construction heaters); President, Portable Heater Parts, a division of Manufacturers Products, Inc. Previous Position : Vice President, Walsh & Kelly, Inc.

James F. Will Birth Date: October 12, 1938 Saint Vincent College Latrobe, PA DIRECTOR Began serving: April 2006		Principal Occupations: Director or Trustee of the Federated Fund Complex; Vice Chancellor and President, Saint Vincent College. Other Directorships Held: Allegheny Corporation. Previous Positions: Chairman, President and Chief Executive Officer, Armco, Inc.; President and Chief Executive Officer, Cyclops Industries; President and Chief Operating Officer, Kaiser Steel Corporation.

OFFICERS


Name Birth Date Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years and Previous Position(s)
John W. McGonigle Birth Date: October 26, 1938 EXECUTIVE VICE PRESIDENT AND SECRETARY Began serving: May 1989		Principal Occupations : Executive Vice President and Secretary of the Federated Fund Complex; Vice Chairman, Executive Vice President, Secretary and Director, Federated Investors, Inc. Previous Positions : Trustee, Federated Investment Management Company and Federated Investment Counseling; Director, Federated Global Investment Management Corp., Federated Services Company and Federated Securities Corp.

Richard A. Novak Birth Date: December 25, 1963 TREASURER Began serving: January 2006		Principal Occupations : Principal Financial Officer and Treasurer of the Federated Fund Complex; Senior Vice President, Federated Administrative Services; Financial and Operations Principal for Federated Securities Corp., Edgewood Services, Inc. and Southpointe Distribution Services, Inc. Previous Positions : Vice President, Finance of Federated Services Company; held various financial management positions within The Mercy Hospital of Pittsburgh; Auditor, Arthur Andersen & Co.

Richard B. Fisher Birth Date: May 17, 1923 VICE CHAIRMAN Began serving: August 2002		Principal Occupations : Vice Chairman or Vice President of some of the Funds in the Federated Fund Complex; Vice Chairman, Federated Investors, Inc.; Chairman, Federated Securities Corp. Previous Positions : President and Director or Trustee of some of the Funds in the Federated Fund Complex; Executive Vice President, Federated Investors, Inc. and Director and Chief Executive Officer, Federated Securities Corp.

Brian P. Bouda Birth Date: February 28, 1947 SENIOR VICE PRESIDENT Began serving: January 2006		Principal Occupations : Senior Vice President and Chief Compliance Officer of the Federated Fund Complex; Vice President and Chief Compliance Officer of Federated Investors, Inc.; and Chief Compliance Officer of its subsidiaries. Mr. Bouda joined Federated in 1999 and is a member of the American Bar Association and the State Bar Association of Wisconsin.


Name Birth Date Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years and Previous Position(s)
Deborah A. Cunningham Birth Date: September 15, 1959 CHIEF INVESTMENT OFFICER Began serving: May 2004		Principal Occupations : Deborah A. Cunningham has been the Fund's Portfolio Manager since January 2004. Ms. Cunningham was named Chief Investment Officer of money market products in 2004 and is a Vice President of the Corporation. She joined Federated in 1981 and has been a Senior Portfolio Manager and a Senior Vice President of the Fund's Adviser since 1997. Ms. Cunningham is a Chartered Financial Analyst and received her M.S.B.A. in Finance from Robert Morris College.

Mary Jo Ochson Birth Date: September 12, 1953 VICE PRESIDENT Began serving: November 1998		Principal Occupations : Mary Jo Ochson was named Chief Investment Officer of tax-exempt, fixed-income products in 2004 and is a Vice President of the Corporation. She joined Federated in 1982 and has been a Senior Portfolio Manager and a Senior Vice President of the Fund's Adviser since 1996. Ms. Ochson is a Chartered Financial Analyst and received her M.B.A. in Finance from the University of Pittsburgh.

Evaluation and Approval of Advisory Contract

PRIME CASH SERIES (THE "FUND")

During the year ending December 31, 2005, the Fund's performance was above the median of the relevant peer group.

During the year ending December 31, 2005, the Fund's investment advisory fee after waivers and expense reimbursements, if any, was above the median of the relevant peer group.

Voting Proxies on Fund Portfolio Securities

Quarterly Portfolio Schedule

The Fund files with the SEC a complete schedule of its portfolio holdings, as of the close of the first and third quarters of its fiscal year, on "Form N-Q." These filings are available on the SEC's website at www.sec.gov and may be reviewed and copied at the SEC's Public Reference Room in Washington, DC. (Call 1-800-SEC-0330 for information on the operation of the Public Reference Room.) You may also access this information from the "Products" section of the Federated Investors website at FederatedInvestors.com by clicking on "Portfolio Holdings" and selecting the name of the Fund, or by selecting the name of the Fund and clicking on "Portfolio Holdings." You must register on the website the first time you wish to access this information.

This report is authorized for distribution to prospective investors only when preceded or accompanied by the fund's prospectus, which contains facts concerning its objective and policies, management fees, expenses, and other information.

Federated
World-Class Investment Manager

Prime Cash Series
Federated Investors Funds
5800 Corporate Drive
Pittsburgh, PA 15237-7000
Contact us at FederatedInvestors.com
or call 1-800-341-7400.

Federated Securities Corp., Distributor

Cusip 147551105

28566 (7/06)

Federated is a registered mark of Federated Investors, Inc. 2006 (c)Federated Investors, Inc.

Federated
World-Class Investment Manager

Treasury Cash Series

A Portfolio of Cash Trust Series, Inc.

ANNUAL SHAREHOLDER REPORT

May 31, 2006

Not FDIC Insured * May Lose Value * No Bank Guarantee

Federated Investors 50 Years of Growth & Innovation

Financial Highlights

(For a Share Outstanding Throughout Each Period)

Year Ended May 31	2006	¹	2005		2004		2003		2002
Net Asset Value, Beginning of Period	$1.00		$1.00		$1.00		$1.00		$1.00
Income From Investment Operations:
Net investment income	0.0295		0.0091		0.0004		0.0051		0.0159
Net realized gain on investments	0.0000	²	0.0000	²	0.0002		0.0006		0.0007
TOTAL FROM INVESTMENT OPERATIONS	0.0295		0.0091		0.0006		0.0057		0.0166
Less Distributions:
Distributions from net investment income	(0.0295	)	(0.0091	)	(0.0004	)	(0.0051	)	(0.0159	)
Distributions from net realized gain on investments	(0.0000	)²	(0.0000	)²	(0.0002	)	(0.0006	)	(0.0007	)
TOTAL DISTRIBUTIONS	(0.0295	)	(0.0091	)	(0.0006	)	(0.0057	)	(0.0166	)
Net Asset Value, End of Period	$1.00		$1.00		$1.00		$1.00		$1.00
Total Return³	2.99	%	0.91	%	0.06	%	0.57	%	1.67	%

Ratios to Average Net Assets:
Net expenses	1.05	%	1.05	%	1.01	%	1.05	%	1.03	%
Net investment income	3.00	%	0.87	%	0.04	%	0.54	%	1.63	%
Expense waiver/reimbursement⁴	0.06	%	0.08	%	0.09	%	0.05	%	- --
Supplemental Data:
Net assets, end of period (000 omitted)	$388,810		$252,537		$341,511		$491,107		$606,949

1 Beginning with the year ended May 31, 2006, the Fund was audited by Ernst & Young LLP. The previous years were audited by another independent registered public accounting firm.

2 Represents less than $0.0001.

3 Based on net asset value. Total returns for periods of less than one year, if any, are not annualized.

4 This expense decrease is reflected in both the net expense and the net investment income ratios shown above.

See Notes which are an integral part of the Financial Statements

Shareholder Expense Example

ACTUAL EXPENSES

HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES

	Beginning Account Value 12/1/2005	Ending Account Value 5/31/2006	Expenses Paid During Period¹
Actual	$1,000	$1,017.30	$5.28
Hypothetical (assuming a 5% return before expenses)	$1,000	$1,019.70	$5.29

1 Expenses are equal to the Fund's annualized net expense ratio of 1.05%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).

Portfolio of Investments Summary Tables

At May 31, 2006, the Fund's portfolio composition¹was as follows:

	Percentage of Total Net Assets
Repurchase Agreements	94.9	%
U.S. Treasury Securities	5.2	%
Other Assets and Liabilities--Net²	(0.1	)%
TOTAL	100.0	%

At May 31, 2006, the Fund's effective maturity³ schedule was as follows:

Securities With an Effective Maturity of:	Percentage of Total Net Assets
1-7 Days	91.8	%
8-30 Days	4.6	%
31-90 Days	1.1	%
91-180 Days	0.7	%
181 Days or more	1.9	%
Other Assets and Liabilities--Net²	(0.1	)%
TOTAL	100.0	%

1 See the Fund's Prospectus for a description of the principal types of securities in which the Fund invests.

2 Assets, other than investments in securities, less liabilities. See Statement of Assets and Liabilities.

3 Effective maturity is determined in accordance with the requirements of Rule 2a-7 under the Investment Company Act of 1940, which regulates money market mutual funds.

Portfolio of Investments

May 31, 2006

Principal Amount					Value
			U.S. TREASURY--5.2%
			U.S. Treasury Notes--5.2%
$	20,250,000		2.500% - 7.000%, 6/30/2006 - 1/31/2007	$	20,167,320
			REPURCHASE AGREEMENTS--94.9%
	49,040,000		Interest in $2,445,000,000 joint repurchase agreement 4.91%, dated 5/31/2006 under which BNP Paribas Securities Corp. will repurchase U.S. Treasury securities with various maturities to 4/15/2029 for $2,445,333,471 on 6/1/2006. The market value of the underlying securities at the end of the period was $2,493,900,070.		49,040,000
	77,000,000		Interest in $1,000,000,000 joint repurchase agreement 4.91%, dated 5/31/2006 under which Banc of America Securities LLC will repurchase U.S. Treasury securities with various maturities to 8/15/2021 for $1,000,136,389 on 6/1/2006. The market value of the underlying securities at the end of the period was $1,020,001,262.		77,000,000
	77,000,000		Interest in $2,000,000,000 joint repurchase agreement 4.91%, dated 5/31/2006 under which Barclays Capital, Inc. will repurchase U.S. Treasury securities with various maturities to 4/15/2032 for $2,000,272,778 on 6/1/2006. The market value of the underlying securities at the end of the period was $2,040,000,987.		77,000,000
	77,000,000		Interest in $1,000,000,000 joint repurchase agreement 4.90%, dated 5/31/2006 under which Deutsche Bank Securities, Inc. will repurchase U.S. Treasury securities with various maturities to 8/15/2029 for $1,000,136,111 on 6/1/2006. The market value of the underlying securities at the end of the period was $1,020,139,234.		77,000,000
	77,000,000		Interest in $800,000,000 joint repurchase agreement 4.90%, dated 5/31/2006 under which Morgan Stanley & Co., Inc. will repurchase U.S. Treasury securities with various maturities to 2/15/2021 for $800,108,889 on 6/1/2006. The market value of the underlying securities at the end of the period was $817,889,416.		77,000,000
	12,000,000	¹	Interest in $500,000,000 joint repurchase agreement 4.90%, dated 5/23/2006 under which UBS Securities LLC will repurchase U.S. Treasury securities with various maturities to 4/15/2028 for $502,041,667 on 6/23/2006. The market value of the underlying securities at the end of the period was $514,025,940.		12,000,000
			TOTAL REPURCHASE AGREEMENTS		369,040,000
			TOTAL INVESTMENTS--100.1% (AT AMORTIZED COST)²		389,207,320
			OTHER ASSETS AND LIABILITIES - NET--(0.1)%		(397,370	)
			TOTAL NET ASSETS-100%	$	388,809,950

1 Although the repurchase date is more than seven days after the date of purchase, the fund has the right to terminate the repurchase agreement at any time with seven-days' notice.

2 Also represents cost for federal tax purposes.

Note: The categories of investments are shown as a percentage of total net assets at May 31, 2006.

See Notes which are an integral part of the Financial Statements

Statement of Assets and Liabilities

May 31, 2006

Assets:
Investments in repurchase agreements	$	369,040,000
Investments in securities		20,167,320
Total investments in securities, at amortized cost and value			$	389,207,320
Income receivable				246,117
TOTAL ASSETS				389,453,437
Liabilities:
Income distribution payable		289,009
Payable to bank		113,505
Payable for distribution services fee (Note 5)		31,471
Payable for shareholder services fee (Note 5)		76,308
Payable for Directors'/Trustees' fees		716
Payable for transfer agent and dividend disbursing agent fees and expenses		79,530
Payable for share registration costs		32,860
Accrued expenses		20,088
TOTAL LIABILITIES				643,487
Net assets for 388,806,886 shares outstanding			$	388,809,950
Net Assets Consist of:
Paid-in capital			$	388,806,886
Undistributed net investment income				3,064
TOTAL NET ASSETS			$	388,809,950
Net Asset Value, Offering Price and Redemption Proceeds Per Share:
($388,809,950 ÷ 388,806,886 shares outstanding), $0.001 par value, 12,500,000,000 shares authorized				$1.00

See Notes which are an integral part of the Financial Statements

Statement of Operations

Year Ended May 31, 2006

Investment Income:
Interest							$	13,612,433
Expenses:
Investment adviser fee (Note 5)				$	1,677,254
Administrative personnel and services fee (Note 5)					267,236
Custodian fees					23,206
Transfer and dividend disbursing agent fees and expenses					345,290
Directors'/Trustees' fees					4,886
Auditing fees					14,215
Legal fees					8,285
Portfolio accounting fees					80,201
Distribution services fee (Note 5)					335,451
Shareholder services fee (Note 5)					834,190
Share registration costs					90,719
Printing and postage					28,786
Insurance premiums					9,221
Taxes (Note 2)					5,575
Miscellaneous					17,077
TOTAL EXPENSES					3,741,592
Waivers (Note 5):
Waiver of investment adviser fee	$	(191,373	)
Waiver of administrative personnel and services fee		(11,623	)
TOTAL WAIVERS					(202,996	)
Net expenses								3,538,596
Net investment income								10,073,837
Net realized gain on investments								1,089
Change in net assets resulting from operations							$	10,074,926

See Notes which are an integral part of the Financial Statements

Statement of Changes in Net Assets

Year Ended May 31		2006			2005
Increase (Decrease) in Net Assets
Operations:
Net investment income	$	10,073,837		$	2,044,349
Net realized gain on investments		1,089			4,004
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS		10,074,926			2,048,353
Distributions to Shareholders:
Distributions from net investment income		(10,071,186	)		(2,050,715	)
Distributions from net realized gain on investments		(1,089	)		(4,004	)
CHANGE IN NET ASSETS RESULTING FROM DISTRIBUTIONS TO SHAREHOLDERS		(10,072,275	)		(2,054,719	)
Share Transactions:
Proceeds from sale of shares		1,165,590,473			820,007,955
Net asset value of shares issued to shareholders in payment of distributions declared		9,604,579			1,916,404
Cost of shares redeemed		(1,038,924,327	)		(910,892,264	)
CHANGE IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS		136,270,725			(88,967,905	)
Change in net assets		136,273,376			(88,974,271	)
Net Assets:
Beginning of period		252,536,574			341,510,845
End of period (including undistributed net investment income of $3,064 and $413, respectively)	$	388,809,950		$	252,536,574

See Notes which are an integral part of the Financial Statements

Notes to Financial Statements

May 31, 2006

1. ORGANIZATION

Cash Trust Series, Inc. (the "Corporation") is registered under the Investment Company Act of 1940, as amended (the "Act"), as an open-end management investment company. The Corporation consists of four portfolios. The financial statements included herein are only those of Treasury Cash Series (the "Fund"). The financial statements of the other portfolios are presented separately. The assets of each portfolio are segregated and a shareholder's interest is limited to the portfolio in which shares are held. The primary investment objective of the Fund is to provide current income consistent with stability of principal and liquidity.

2. SIGNIFICANT ACCOUNTING POLICIES

Investment Valuation

The Fund uses the amortized cost method to value its portfolio securities in accordance with Rule 2a-7 under the Act.

Repurchase Agreements

The Fund may enter into repurchase agreements in which eligible securities are transferred into joint trading accounts maintained by the custodian or sub-custodian for investment companies and other clients advised by the Adviser and its affiliates. The Fund will participate on a pro rata basis with the other investment companies and clients in its share of the securities transferred under such repurchase agreements and in its share of proceeds from any repurchase or other disposition of such securities.

Investment Income, Expenses and Distributions

Interest income and expenses are accrued daily. Distributions to shareholders are recorded on the ex-dividend date. Distributions of net investment income are declared daily and paid monthly.

Premium and Discount Amortization

All premiums and discounts on fixed-income securities are amortized/accreted.

Federal Taxes

Other Taxes

When-Issued and Delayed Delivery Transactions

Use of Estimates

Other

Investment transactions are accounted for on a trade date basis. Realized gains and losses from investment transactions are recorded on an identified cost basis.

3. CAPITAL STOCK

The following table summarizes capital stock activity:

Year Ended May 31	2006		2005
Shares sold	1,165,590,473		820,007,955
Shares issued to shareholders in payment of distributions declared	9,604,579		1,916,404
Shares redeemed	(1,038,924,327	)	(910,892,264	)
NET CHANGE RESULTING FROM SHARE TRANSACTIONS	136,270,725		(88,967,905	)

4. FEDERAL TAX INFORMATION

The tax character of distributions as reported on the Statement of Changes in Net Assets for the years ended May 31, 2006 and 2005, was as follows:

		2006		2005
Ordinary income¹		$10,072,275		$2,054,719

1 For tax purposes short-term capital gain distributions are considered ordinary income distributions.

As of May 31, 2006, the components of distributable earnings on a tax basis were as follows:

Undistributed ordinary income		$	292,073
Other temporary adjustments		$	(289,009	)

5. INVESTMENT ADVISER FEE AND OTHER TRANSACTIONS WITH AFFILIATES

Investment Adviser Fee

Federated Investment Management Company, the Fund's investment adviser (the "Adviser"), receives for its services an annual investment adviser fee equal to 0.50% of the fund's average daily net assets. The Adviser may voluntarily choose to waive any portion of its fee. The Adviser can modify or terminate this voluntary waiver at any time at its sole discretion. For the year ended May 31, 2006, the Adviser voluntarily waived $191,373 of its fee.

Administrative Fee

Maximum Administrative Fee		Average Aggregate Daily Net Assets of the Federated Funds
0.150%		on the first $5 billion
0.125%		on the next $5 billion
0.100%		on the next $10 billion
0.075%		on assets in excess of $20 billion

Distribution Services Fee

The Fund has adopted a Distribution Plan (the "Plan") pursuant to Rule 12b-1 under the Act. Under the terms of the Plan, the Fund will compensate Federated Securities Corp. (FSC), the principal distributor, from the daily net assets of the Fund's shares to finance activities intended to result in the sale of these shares. The Plan provides that the Fund may incur distribution expenses of 0.35% of average daily net assets, annually, to compensate FSC. FSC may voluntarily choose to waive any portion of its fee. FSC can modify or terminate this voluntary waiver at any time at its sole discretion. When FSC receives fees, it may pay some or all of them to financial intermediaries whose customers purchase shares. For the year ended May 31, 2006, FSC did not retain any fees paid by the Fund.

Shareholder Services Fee

The Fund may pay fees (Service Fees) up to 0.25% of the average daily net assets of the Fund's Shares to financial intermediaries or to Federated Shareholder Services Company (FSSC), for providing services to shareholders and maintaining shareholder accounts. FSSC or these financial intermediaries may voluntarily choose to waive any portion of their fee. This voluntary waiver can be modified or terminated at any time. For the year ended May 31, 2006, FSSC did not receive any fees paid by the Fund.

General

Certain of the Officers and Directors of the Fund are Officers and Directors or Trustees of the above companies.

6. LEGAL PROCEEDINGS

7. CHANGE IN INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

On May 20, 2005, the Fund's Board of Directors, upon the recommendation of the Audit Committee, appointed Ernst & Young LLP (E&Y) as the Fund's independent registered public accounting firm. The Fund's previous independent registered public accounting firm, Deloitte & Touche LLP (D&T) declined to stand for re-election. The previous reports issued by D&T on the Fund's financial statements for the fiscal years ended May 31, 2004 and May 31, 2005, contained no adverse opinion or disclaimer of opinion nor were they qualified or modified as to uncertainty, audit scope or accounting principles. During the Fund's fiscal years ended May 31, 2004 and May 31, 2005: (i) there were no disagreements with D&T on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of D&T, would have caused it to make reference to the subject matter of the disagreements in connection with its reports on the financial statements for such years; and (ii) there were no reportable events of the kind described in Item 304(a) (1) (v) of Regulation S-K under the Securities Exchange Act of 1934, as amended.

As indicted above, the Fund has appointed E&Y as the independent registered public accounting firm to audit the Fund's financial statements for the fiscal year ending May 31, 2006. During the Fund's fiscal years ended May 31, 2004 and May 31, 2005 and the interim period commencing June 1, 2005 and ending July 19, 2005, neither the Fund nor anyone on its behalf has consulted E&Y on items which: (i) concerned the application of accounting principles to a specified transaction, either completed or proposed, or the type of audit opinion that might be rendered on the Fund's financial statements; or (ii) concerned the subject of a disagreement (as defined in paragraph (a) (1) (iv) of Item 304 of Regulations S-K) or reportable events (as described in paragraph (a) (1) (v) of said Item 304).

Report of Independent Registered Public Accounting Firm

TO THE BOARD OF DIRECTORS OF CASH TRUST SERIES, INC. AND THE SHAREHOLDERS OF TREASURY CASH SERIES:

We have audited the accompanying statement of assets and liabilities of Treasury Cash Series (the "Fund") (one of the portfolios constituting Cash Trust Series, Inc.), including the portfolio of investments, as of May 31, 2006, and the related statements of operations, changes in net assets, and the financial highlights for the year then ended. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audit. The statement of changes in net assets for the year ended May 31, 2005 and the financial highlights for each of the four years in the period then ended were audited by another independent registered public accounting firm whose report, dated July 19, 2005, expressed an unqualified opinion on that statement and those financial highlights.

We conducted our audit in accordance with 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 and financial highlights are free of material misstatement. We were not engaged to perform an audit of the Fund's internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our procedures included confirmation of securities with the custodian and brokers. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Treasury Cash Series, a portfolio of Cash Trust Series, Inc., at May 31, 2006, the results of its operations, the changes in its net assets and the financial highlights for the year then ended, in conformity with U.S. generally accepted accounting principles.

Ernst & Young LLP

Boston, Massachusetts
July 14, 2006

Board of Directors and Corporation Officers

INTERESTED DIRECTORS BACKGROUND


Name Birth Date Address Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s)
John F. Donahue* Birth Date: July 28, 1924 DIRECTOR Began serving: May 1989		Principal Occupations : Director or Trustee of the Federated Fund Complex; Chairman and Director, Federated Investors, Inc.; Chairman of the Federated Fund Complex's Executive Committee. Previous Positions : Chairman of the Federated Fund Complex; Trustee, Federated Investment Management Company and Chairman and Director, Federated Investment Counseling.

J. Christopher Donahue* Birth Date: April 11, 1949 PRESIDENT AND DIRECTOR Began serving: May 1989		Principal Occupations : Principal Executive Officer and President of the Federated Fund Complex; Director or Trustee of some of the Funds in the Federated Fund Complex; President, Chief Executive Officer and Director, Federated Investors, Inc.; Chairman and Trustee, Federated Investment Management Company; Trustee, Federated Investment Counseling; Chairman and Director, Federated Global Investment Management Corp.; Chairman, Passport Research, Ltd. (Investment advisory subsidiary of Federated); Trustee, Federated Shareholder Services Company; Director, Federated Services Company. Previous Positions : President, Federated Investment Counseling; President and Chief Executive Officer, Federated Investment Management Company, Federated Global Investment Management Corp. and Passport Research, Ltd.


Name Birth Date Address Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s)
Lawrence D. Ellis, M.D.* Birth Date: October 11, 1932 3471 Fifth Avenue Suite 1111 Pittsburgh, PA DIRECTOR Began serving: May 1989		Principal Occupations : Director or Trustee of the Federated Fund Complex; Professor of Medicine, University of Pittsburgh; Medical Director, University of Pittsburgh Medical Center Downtown; Hematologist, Oncologist and Internist, University of Pittsburgh Medical Center. Other Directorships Held : Member, National Board of Trustees, Leukemia Society of America. Previous Positions : Trustee, University of Pittsburgh; Director, University of Pittsburgh Medical Center.

INDEPENDENT DIRECTORS BACKGROUND


Name Birth Date Address Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s)
Thomas G. Bigley Birth Date: February 3, 1934 15 Old Timber Trail Pittsburgh, PA DIRECTOR Began serving: November 1994		Principal Occupation : Director or Trustee of the Federated Fund Complex. Other Directorships Held : Director, Member of Executive Committee, Children's Hospital of Pittsburgh; Director, University of Pittsburgh. Previous Position : Senior Partner, Ernst & Young LLP.

John T. Conroy, Jr. Birth Date: June 23, 1937 Investment Properties Corporation 3838 North Tamiami Trail Suite 402 Naples, FL DIRECTOR Began serving: August 1991		Principal Occupations : Director or Trustee of the Federated Fund Complex; Chairman of the Board, Investment Properties Corporation; Partner or Trustee in private real estate ventures in Southwest Florida. Previous Positions : President, Investment Properties Corporation; Senior Vice President, John R. Wood and Associates, Inc., Realtors; President, Naples Property Management, Inc. and Northgate Village Development Corporation.


Name Birth Date Address Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s)
Nicholas P. Constantakis Birth Date: September 3, 1939 175 Woodshire Drive Pittsburgh, PA DIRECTOR Began serving: February 1998		Principal Occupation : Director or Trustee of the Federated Fund Complex. Other Directorships Held : Director and Member of the Audit Committee, Michael Baker Corporation (engineering and energy services worldwide). Previous Position : Partner, Andersen Worldwide SC.

John F. Cunningham Birth Date: March 5, 1943 353 El Brillo Way Palm Beach, FL DIRECTOR Began serving: January 1999		Principal Occupation : Director or Trustee of the Federated Fund Complex; Director, WinsorTech. Other Directorships Held : Chairman, President and Chief Executive Officer, Cunningham & Co., Inc. (strategic business consulting); Trustee Associate, Boston College. Previous Positions : Director, Redgate Communications and EMC Corporation (computer storage systems); Chairman of the Board and Chief Executive Officer, Computer Consoles, Inc.; President and Chief Operating Officer, Wang Laboratories; Director, First National Bank of Boston; Director, Apollo Computer, Inc.

Peter E. Madden Birth Date: March 16, 1942 One Royal Palm Way 100 Royal Palm Way Palm Beach, FL DIRECTOR Began serving: August 1991		Principal Occupation : Director or Trustee of the Federated Fund Complex. Other Directorships Held : Board of Overseers, Babson College. Previous Positions : Representative, Commonwealth of Massachusetts General Court; President, State Street Bank and Trust Company and State Street Corporation (retired); Director, VISA USA and VISA International; Chairman and Director, Massachusetts Bankers Association; Director, Depository Trust Corporation; Director, The Boston Stock Exchange.

Charles F. Mansfield, Jr. Birth Date: April 10, 1945 80 South Road Westhampton Beach, NY DIRECTOR Began serving: January 1999		Principal Occupations : Director or Trustee of the Federated Fund Complex; Management Consultant. Previous Positions : Chief Executive Officer, PBTC International Bank; Partner, Arthur Young & Company (now Ernst & Young LLP); Chief Financial Officer of Retail Banking Sector, Chase Manhattan Bank; Senior Vice President, HSBC Bank USA (formerly, Marine Midland Bank); Vice President, Citibank; Assistant Professor of Banking and Finance, Frank G. Zarb School of Business, Hofstra University; Executive Vice President, DVC Group, Inc.


Name Birth Date Address Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years, Other Directorships Held and Previous Position(s)
John E. Murray, Jr., J.D., S.J.D. Birth Date: December 20, 1932 Chancellor, Duquesne University Pittsburgh, PA DIRECTOR Began serving: February 1995		Principal Occupations : Director or Trustee, and Chairman of the Board of Directors or Trustees, of the Federated Fund Complex; Chancellor and Law Professor, Duquesne University; Partner, Murray, Hogue & Lannis. Other Directorships Held : Director, Michael Baker Corp. (engineering, construction, operations and technical services). Previous Positions : President, Duquesne University; Dean and Professor of Law, University of Pittsburgh School of Law; Dean and Professor of Law, Villanova University School of Law.

Marjorie P. Smuts Birth Date: June 21, 1935 4905 Bayard Street Pittsburgh, PA DIRECTOR Began serving: May 1989		Principal Occupations : Director or Trustee of the Federated Fund Complex; Public Relations/Marketing Consultant/Conference Coordinator. Previous Positions : National Spokesperson, Aluminum Company of America; television producer; President, Marj Palmer Assoc.; Owner, Scandia Bord.

John S. Walsh Birth Date: November 28, 1957 2604 William Drive Valparaiso, IN DIRECTOR Began serving: January 1999		Principal Occupations : Director or Trustee of the Federated Fund Complex; President and Director, Heat Wagon, Inc. (manufacturer of construction temporary heaters); President and Director, Manufacturers Products, Inc. (distributor of portable construction heaters); President, Portable Heater Parts, a division of Manufacturers Products, Inc. Previous Position : Vice President, Walsh & Kelly, Inc.

James F. Will Birth Date: October 12, 1938 Saint Vincent College Latrobe, PA DIRECTOR Began serving: April 2006		Principal Occupations : Director or Trustee of the Federated Fund Complex; Vice Chancellor and President, Saint Vincent College. Other Directorships Held : Alleghany Corporation. Previous Positions : Chairman, President and Chief Executive Officer, Armco, Inc.; President and Chief Executive Officer, Cyclops Industries; President and Chief Operating Officer, Kaiser Steel Corporation.

OFFICERS


Name Birth Date Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years and Previous Position(s)
John W. McGonigle Birth Date: October 26, 1938 EXECUTIVE VICE PRESIDENT AND SECRETARY Began serving: May 1989		Principal Occupations : Executive Vice President and Secretary of the Federated Fund Complex; Vice Chairman, Executive Vice President, Secretary and Director, Federated Investors, Inc. Previous Positions : Trustee, Federated Investment Management Company and Federated Investment Counseling; Director, Federated Global Investment Management Corp., Federated Services Company and Federated Securities Corp.

Richard A. Novak Birth Date: December 25, 1963 TREASURER Began serving: January 2006		Principal Occupations : Principal Financial Officer and Treasurer of the Federated Fund Complex; Senior Vice President, Federated Administrative Services; Financial and Operations Principal for Federated Securities Corp., Edgewood Services, Inc. and Southpointe Distribution Services, Inc. Previous Positions : Vice President, Finance of Federated Services Company; held various financial management positions within The Mercy Hospital of Pittsburgh; Auditor, Arthur Andersen & Co.

Richard B. Fisher Birth Date: May 17, 1923 VICE CHAIRMAN Began serving: August 2002		Principal Occupations : Vice Chairman or Vice President of some of the Funds in the Federated Fund Complex; Vice Chairman, Federated Investors, Inc.; Chairman, Federated Securities Corp. Previous Positions : President and Director or Trustee of some of the Funds in the Federated Fund Complex; Executive Vice President, Federated Investors, Inc. and Director and Chief Executive Officer, Federated Securities Corp.

Brian P. Bouda Birth Date: February 28, 1947 SENIOR VICE PRESIDENT Began serving: January 2006		Principal Occupations : Senior Vice President and Chief Compliance Officer of the Federated Fund Complex; Vice President and Chief Compliance Officer of Federated Investors, Inc.; and Chief Compliance Officer of its subsidiaries. Mr. Bouda joined Federated in 1999 and is a member of the American Bar Association and the State Bar Association of Wisconsin.


Name Birth Date Positions Held with Corporation Date Service Began		Principal Occupation(s) for Past Five Years and Previous Position(s)
Deborah A. Cunningham Birth Date: September 15, 1959 CHIEF INVESTMENT OFFICER Began serving: May 2004		Principal Occupations: Deborah A. Cunningham has been the Fund's Portfolio Manager since January 2004. Ms. Cunningham was named Chief Investment Officer of money market products in 2004 and is a Vice President of the Corporation. She joined Federated in 1981 and has been a Senior Portfolio Manager and a Senior Vice President of the Fund's Adviser since 1997. Ms. Cunningham is a Chartered Financial Analyst and received her M.S.B.A. in Finance from Robert Morris College.

Mary Jo Ochson Birth Date: September 12, 1953 VICE PRESIDENT Began serving: November 1998		Principal Occupations: Mary Jo Ochson was named Chief Investment Officer of tax-exempt, fixed-income products in 2004 and is a Vice President of the Corporation. She joined Federated in 1982 and has been a Senior Portfolio Manager and a Senior Vice President of the Fund's Adviser since 1996. Ms. Ochson is a Chartered Financial Analyst and received her M.B.A. in Finance from the University of Pittsburgh.

Evaluation and Approval of Advisory Contract

TREASURY CASH SERIES (THE "FUND")

With respect to the Fund's performance and expenses in particular, the Board has found the use of comparisons to other mutual funds with comparable investment programs to be particularly useful, given the high degree of competition in the mutual fund business. The Board focused on comparisons with other similar mutual funds more heavily than non-mutual fund products or services because, simply put, they are more relevant. For example, other mutual funds are the products most like the Fund, they are readily available to Fund shareholders as alternative investment vehicles, and they are the type of investment vehicle in fact chosen and maintained by the Fund's investors. The range of their fees and expenses therefore appears to be a generally reliable indication of what consumers have found to be reasonable in the precise marketplace in which the Fund competes. The Fund's ability to deliver competitive performance when compared to its peer group was a useful indicator of how the Adviser is executing the Fund's investment program, which in turn assisted the Board in reaching a conclusion that the nature, extent, and quality of the Adviser's investment management services were such as to warrant continuation of the advisory contract. In this regard, the Senior Officer has reviewed Federated's fees for providing advisory services to products outside the Federated family of funds ( e.g. , institutional and separate accounts). He concluded that mutual funds and institutional accounts are inherently different products. Those differences included, but are not limited to targeting different investors, being subject to different laws and regulations, different legal structure, distribution costs, average account size and portfolio management techniques made necessary by different cash flows. The Senior Officer did not consider these fee schedules to be significant in determining the appropriateness of mutual fund advisory contracts.

During the year ending December 31, 2005, the Fund's investment advisory fee after waivers and expense reimbursements, if any, was above the median of the relevant peer group.

Voting Proxies on Fund Portfolio Securities

Quarterly Portfolio Schedule

The Fund files with the SEC a complete schedule of its portfolio holdings, as of the close of the first and third quarters of its fiscal year, on "Form N-Q." These filings are available on the SEC's website at www.sec.gov and may be reviewed and copied at the SEC's Public Reference Room in Washington, DC. (Call 1-800-SEC-0330 for information on the operation of the Public Reference Room.) You may also access this information from the "Products" section of the Federated Investors website at FederatedInvestors.com by clicking on "Portfolio Holdings" and selecting the name of the Fund, or by selecting the name of the Fund and clicking on "Portfolio Holdings." You must register on the website the first time you wish to access this information.

Federated
World-Class Investment Manager

Treasury Cash Series
Federated Investors Funds
5800 Corporate Drive
Pittsburgh, PA 15237-7000
Contact us at FederatedInvestors.com
or call 1-800-341-7400.

Federated Securities Corp., Distributor

Cusip 147551402

28567 (7/06)

Federated is a registered mark of Federated Investors, Inc. 2006 (c)Federated Investors, Inc.







Item 2.     Code of Ethics

(a) As of the end of the period covered by this report, the registrant has
adopted a code of ethics (the "Section 406 Standards for Investment Companies -
Ethical Standards for Principal Executive and Financial Officers") that applies
to the registrant's Principal Executive Officer and Principal Financial Officer;
the registrant's Principal Financial Officer also serves as the Principal
Accounting Officer.

(c) Not Applicable

(d) Not Applicable

(e) Not Applicable

(f)(3) The registrant hereby undertakes to provide any person, without charge,
upon request, a copy of the code of ethics. To request a copy of the code of
ethics, contact the registrant at 1-800-341-7400, and ask for a copy of the
Section 406 Standards for Investment Companies - Ethical Standards for Principal
Executive and Financial Officers.


Item 3.     Audit Committee Financial Expert

The registrant's Board has determined that each member of the Board's
Audit Committee is an "audit committee financial expert," and that each
such member is "independent," for purposes of this Item.  The Audit
Committee consists of the following Board members:  Thomas G. Bigley,
John T. Conroy, Jr., Nicholas P. Constantakis and Charles F. Mansfield,
Jr.


Item 4.     Principal Accountant Fees and Services


(a) Audit Fees billed to the registrant for the two most recent fiscal years:

                        Fiscal year ended 2006 - $65,580

                        Fiscal year ended 2005 - $56,700



(b) Audit-Related Fees billed to the registrant for the two most recent fiscal
years:

                  Fiscal year ended 2006 - $ 0

                        Fiscal year ended 2005 - $10,755

                  Transfer Agent Service Auditors Report

      Amount requiring approval of the registrant's audit committee pursuant to
      paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X, $1,509 and $33,444
      respectively. Fiscal year ended 2006 - Sarbanes Oxley 302 procedures.
      Fiscal year ended 2005 - Transfer Agent Service Auditors report.



(c) Tax Fees billed to the registrant for the two most recent fiscal years:

                  Fiscal year ended 2006 - $0

                  Fiscal year ended 2005 - $0

      Amount requiring approval of the registrant's audit committee pursuant to
      paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X, $ 0 and $ 0
      respectively.





(d) All Other Fees billed to the registrant for the two most recent fiscal
years:

                  Fiscal year ended 2006 - $0

                  Fiscal year ended 2005 - $0

      Amount requiring approval of the registrant's audit committee pursuant to
      paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X, $0 and $29,187
      respectively. Fiscal year ended 2005 - Discussions with auditor related to
      market timing and late trading activities, money market yield analysis and
      executive compensation analysis.



(e)(1) Audit Committee Policies regarding Pre-approval of Services.

            The Audit Committee is required to pre-approve audit and non-audit
services performed by the independent auditor in order to assure that the
provision of such services do not impair the auditor's independence. Unless a
type of service to be provided by the independent auditor has received general
pre-approval, it will require specific pre-approval by the Audit Committee. Any
proposed services exceeding pre-approved cost levels will require specific
pre-approval by the Audit Committee.

            Certain services have the general pre-approval of the Audit
Committee. The term of the general pre-approval is 12 months from the date of
pre-approval, unless the Audit Committee specifically provides for a different
period. The Audit Committee will annually review the services that may be
provided by the independent auditor without obtaining specific pre-approval from
the Audit Committee and may grant general pre-approval for such services. The
Audit Committee will revise the list of general pre-approved services from time
to time, based on subsequent determinations. The Audit Committee will not
delegate its responsibilities to pre-approve services performed by the
independent auditor to management.

            The Audit Committee has delegated pre-approval authority to its
Chairman. The Chairman will report any pre-approval decisions to the Audit
Committee at its next scheduled meeting. The Committee will designate another
member with such pre-approval authority when the Chairman is unavailable.



AUDIT SERVICES

      The annual Audit services engagement terms and fees will be subject to the
specific pre-approval of the Audit Committee. The Audit Committee must approve
any changes in terms, conditions and fees resulting from changes in audit scope,
registered investment company (RIC) structure or other matters.

      In addition to the annual Audit services engagement specifically approved
by the Audit Committee, the Audit Committee may grant general pre-approval for
other Audit Services, which are those services that only the independent auditor
reasonably can provide. The Audit Committee has pre-approved certain Audit
services, all other Audit services must be specifically pre-approved by the
Audit Committee.



AUDIT-RELATED SERVICES

      Audit-related services are assurance and related services that are
reasonably related to the performance of the audit or review of the Company's
financial statements or that are traditionally performed by the independent
auditor. The Audit Committee believes that the provision of Audit-related
services does not impair the independence of the auditor, and has pre-approved
certain Audit-related services, all other Audit-related services must be
specifically pre-approved by the Audit Committee.



TAX SERVICES

      The Audit Committee believes that the independent auditor can provide Tax
services to the Company such as tax compliance, tax planning and tax advice
without impairing the auditor's independence. However, the Audit Committee will
not permit the retention of the independent auditor in connection with a
transaction initially recommended by the independent auditor, the purpose of
which may be tax avoidance and the tax treatment of which may not be supported
in the Internal Revenue Code and related regulations. The Audit Committee has
pre-approved certain Tax services, all Tax services involving large and complex
transactions must be specifically pre-approved by the Audit Committee.



ALL OTHER SERVICES

      With respect to the provision of services other than audit, review or
attest services the pre-approval requirement is waived if:



(1)   The aggregate amount of all such services provided constitutes no
                  more than five percent of the total amount of
                  revenues paid by the registrant, the registrant's
                  adviser (not including any sub-adviser whose role is
                  primarily portfolio management and is subcontracted
                  with or overseen by another investment adviser), and
                  any entity controlling, controlled by, or under
                  common control with the investment adviser that
                  provides ongoing services to the registrant to its
                  accountant during the fiscal year in which the
                  services are provided;
(2)   Such services were not recognized by the registrant, the
                  registrant's adviser (not including any sub-adviser
                  whose role is primarily portfolio management and is
                  subcontracted with or overseen by another investment
                  adviser), and any entity controlling, controlled by,
                  or under common control with the investment adviser
                  that provides ongoing services to the registrant  at
                  the time of the engagement to be non-audit services;
                  and
(3)   Such services are promptly brought to the attention of the Audit
                  Committee of the issuer and approved prior to the
                  completion of the audit by the Audit Committee or by
                  one or more members of the Audit Committee who are
                  members of the board of directors to whom authority
                  to grant such approvals has been delegated by the
                  Audit Committee.


      The Audit Committee may grant general pre-approval to those permissible
non-audit services classified as All Other services that it believes are routine
and recurring services, and would not impair the independence of the auditor.



      The SEC's rules and relevant guidance should be consulted to determine the
precise definitions of prohibited non-audit services and the applicability of
exceptions to certain of the prohibitions.



PRE-APPROVAL FEE LEVELS

      Pre-approval fee levels for all services to be provided by the independent
auditor will be established annually by the Audit Committee. Any proposed
services exceeding these levels will require specific pre-approval by the Audit
Committee.



PROCEDURES

      Requests or applications to provide services that require specific
approval by the Audit Committee will be submitted to the Audit Committee by both
the independent auditor and the Principal Accounting Officer and/or Internal
Auditor, and must include a joint statement as to whether, in their view, the
request or application is consistent with the SEC's rules on auditor
independence.





(e)(2) Percentage of services identified in items 4(b) through 4(d) that were
approved by the registrants audit committee pursuant to paragraph (c)(7)(i)(C)
of Rule 2-01 of Regulation S-X:

            4(b)

                  Fiscal year ended 2006 - 0%

                  Fiscal year ended 2005 - 0%

            Percentage of services provided to the registrants investment
            adviser and any entity controlling, controlled by, or under common
            control with the investment adviser that provides ongoing services
            to the registrant that were approved by the registrants audit
            committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of
            Regulation S-X, 0% and 0% respectively.



            4(c)

                  Fiscal year ended 2006 - 0%

                  Fiscal year ended 2005 - 0%

            Percentage of services provided to the registrants investment
            adviser and any entity controlling, controlled by, or under common
            control with the investment adviser that provides ongoing services
            to the registrant that were approved by the registrants audit
            committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of
            Regulation S-X, 0% and 0% respectively.



            4(d)

                  Fiscal year ended 2006 - 0%

                  Fiscal year ended 2005 - 0%

            Percentage of services provided to the registrants investment
            adviser and any entity controlling, controlled by, or under common
            control with the investment adviser that provides ongoing services
            to the registrant that were approved by the registrants audit
            committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of
            Regulation S-X, 0% and 0% respectively.



(f)   NA


(g)   Non-Audit Fees billed to the registrant, the registrant's investment
      adviser, and certain entities controlling, controlled by or under common
      control with the investment adviser:


                        Fiscal year ended 2006 - $85,896

                        Fiscal year ended 2005 - $127,986



(h) The registrant's Audit Committee has considered that the provision of
non-audit services that were rendered to the registrant's adviser (not including
any sub-adviser whose role is primarily portfolio management and is
subcontracted with or overseen by another investment adviser), and any entity
controlling, controlled by, or under common control with the investment adviser
that provides ongoing services to the registrant that were not pre-approved
pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible
with maintaining the principal accountant's independence.



Item 5.     Audit Committee of Listed Registrants

            Not Applicable

Item 6.     Schedule of Investments

            Not Applicable

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

            Not Applicable

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

            Not Applicable

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

            Not Applicable

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

            Not Applicable

Item 11.    Controls and Procedures

(a) The registrant's President and Treasurer have concluded that the
registrant's disclosure controls and procedures (as defined in rule 30a-3(c)
under the Act) are effective in design and operation and are sufficient to form
the basis of the certifications required by Rule 30a-(2) under the Act, based on
their evaluation of these disclosure controls and procedures within 90 days of
the filing date of this report on Form N-CSR.

(b) There were no changes in the registrant's internal control over financial
reporting (as defined in rule 30a-3(d) under the Act) during the last fiscal
quarter that have materially affected, or are reasonably likely to materially
affect, the registrant's internal control over financial reporting.

Item 12.    Exhibits













SIGNATURES

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

Registrant  Cash Trust Series, Inc.

By          /S/ Richard A. Novak
            Richard A. Novak, Principal Financial Officer
                            (insert name and title)

Date        July 25, 2006


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/ J. Christopher Donahue
            J. Christopher Donahue, Principal Executive Officer


Date        July 25, 2006


By          /S/ Richard A. Novak
            Richard A. Novak, Principal Financial Officer


Date        July 25, 2006

Cash Trust Series Inactive N-CSRCertified annual shareholder report (management investment company)

FederatedWorld-Class Investment Manager

Government Cash Series

ANNUAL SHAREHOLDER REPORT

Financial Highlights

Shareholder Expense Example

ACTUAL EXPENSES

HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES

Portfolio of Investments Summary Tables

Portfolio of Investments

Statement of Assets and Liabilities

Statement of Operations

Statement of Changes in Net Assets

Notes to Financial Statements

1. ORGANIZATION

2. SIGNIFICANT ACCOUNTING POLICIES

Investment Valuation

Repurchase Agreements

Investment Income, Expenses and Distributions

Premium and Discount Amortization

Federal Taxes

Other Taxes

When-Issued and Delayed Delivery Transactions

Use of Estimates

Other

3. CAPITAL STOCK

4. FEDERAL TAX INFORMATION

5. INVESTMENT ADVISER FEE AND OTHER TRANSACTIONS WITH AFFILIATES

Investment Adviser Fee

Administrative Fee

Distribution Services Fee

Shareholder Services Fee

General

6. LEGAL PROCEEDINGS

7. CHANGE IN INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Report of Independent Registered Public Accounting Firm

TO THE BOARD OF DIRECTORS OF CASH TRUST SERIES, INC. AND THE SHAREHOLDERS OF GOVERNMENT CASH SERIES:

Board of Directors and Corporation Officers

INTERESTED DIRECTORS BACKGROUND

INDEPENDENT DIRECTORS BACKGROUND

OFFICERS

Evaluation and Approval of Advisory Contract

GOVERNMENT CASH SERIES (THE "FUND")

Voting Proxies on Fund Portfolio Securities

Quarterly Portfolio Schedule

FederatedWorld-Class Investment Manager

FederatedWorld-Class Investment Manager

Municipal Cash Series

ANNUAL SHAREHOLDER REPORT

Financial Highlights

Shareholder Expense Example

ACTUAL EXPENSES

HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES

Portfolio of Investments Summary Tables

Portfolio of Investments

Statement of Assets and Liabilities

Statement of Operations

Statement of Changes in Net Assets

Notes to Financial Statements

1. ORGANIZATION

2. SIGNIFICANT ACCOUNTING POLICIES

Investment Valuation

Investment Income, Expenses and Distributions

Premium and Discount Amortization

Federal Taxes

Other Taxes

When-Issued and Delayed Delivery Transactions

Restricted Securities

Use of Estimates

Other

3. CAPITAL STOCK

4. FEDERAL TAX INFORMATION

5. INVESTMENT ADVISER FEE AND OTHER TRANSACTIONS WITH AFFILIATES

Investment Adviser Fee

Administrative Fee

Distribution Services Fee

Shareholder Services Fee

Interfund Transactions

General

6. LEGAL PROCEEDINGS

Federated
World-Class Investment Manager

Federated
World-Class Investment Manager

Federated
World-Class Investment Manager

Federated
World-Class Investment Manager

Federated
World-Class Investment Manager

Federated
World-Class Investment Manager

Federated
World-Class Investment Manager