Legg Mason Partners Variable Portfolios Ii NCSRS Certified semi-annual shareholder report (management investment company)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number 811-6310

Legg Mason Partners Variable Portfolios II

(Exact name of registrant as specified in charter)

125 Broad Street, New York, NY 10004
(Address of principal executive offices) (Zip code)

Robert I. Frenkel, Esq.
Legg Mason & Co., LLC
300 First Stamford Place, 4^th Floor
Stamford, CT 06902
(Name and address of agent for service)

Registrant’s telephone number, including area code: (800) 451-2010

Date of fiscal year end: December 31
Date of reporting period: June 30, 2006


ITEM 1.		REPORT TO STOCKHOLDERS.

		The Semi-Annual Report to Stockholders is filed herewith.



SEMI-ANNUAL REPORT JUNE 30, 2006		Legg Mason Partners Variable Portfolios II Legg Mason Partners Variable Appreciation Portfolio Legg Mason Partners Variable Fundamental Value Portfolio Legg Mason Partners Variable Capital and Income Portfolio


		INVESTMENT PRODUCTS: NOT FDIC INSURED•NO BANK GUARANTEE•MAY LOSE VALUE


	Legg Mason Partners Variable Portfolios II

Semi-Annual Report • June 30, 2006

What’s

Inside



Letter from the Chairman		I

Fund at a Glance:

	Legg Mason Partners Variable Appreciation Portfolio	1

	Legg Mason Partners Variable Fundamental Value Portfolio	2

	Legg Mason Partners Variable Capital and Income Portfolio	3

Fund Expenses		4

Schedules of Investments		6

Statements of Assets and Liabilities		35

Statements of Operations		36

Statements of Changes in Net Assets		37

Financial Highlights		40

Notes to Financial Statements		43

Board Approval of Management and Subadvisory Agreements		54


	“Smith Barney”, “Salomon Brothers” and “Citi” are service marks of Citigroup, licensed for use by Legg Mason as the names of funds and investment managers. Legg Mason and its affiliates, as well as the Funds’ investment manager, are not affiliated with Citigroup.


	Letter from the Chairman

R. JAY GERKEN, CFA

Chairman, President and
Chief Executive Officer


	Dear Shareholder,

	The U.S. economy appeared to be on solid footing during the six-month reporting period. After gross domestic product (“GDP”)ⁱ rose 1.7% in the fourth quarter of 2005 — the first quarter in which GDP growth did not surpass 3.0% in nearly three years — the economy rebounded sharply in the first quarter of 2006. During this time, GDP rose 5.6%, its best showing since the third quarter of 2003. Both strong consumer and business spending prompted the economic turnaround. In the second quarter 2006, GDP growth was a more modest 2.5%, according to the Commerce Department’s initial reading for the period. The decline was largely attributed to lower consumer spending, triggered by higher interest rates and oil prices, as well as a cooling housing market. In addition, business spending fell during the quarter.


	The Federal Reserve Board (“Fed”)ⁱⁱ continued to raise interest rates during the reporting period. Despite the “changing of the guard” from Fed Chairman Alan Greenspan to Ben Bernanke in early 2006, it was “business as usual” for the Fed, as it raised short-term interest rates four times during the period. Since it began its tightening campaign in June 2004, the Fed has increased rates 17 consecutive times, bringing the federal funds rateⁱⁱⁱ from 1.00% to 5.25%. Coinciding with its latest rate hike in June 2006, the Fed said: “The extent and timing of any additional firming . . . will depend on the evolution of the outlook for both inflation and economic growth, as implied by incoming information.”
	For the six-month period ended June 30, 2006, the U.S. stock market produced positive returns, with the S&P 500 Index^iv returning 2.71%. While the economy expanded and corporate profits remained strong, the headwinds from steadily rising interest rates, inflationary pressures and the potential for additional Fed rate hikes tempered returns.
	Looking at the market more closely, small-cap stocks outperformed their mid-and large-cap counterparts, with the

Legg Mason Partners Variable Portfolios II I


	Russell 2000^v, Russell Midcap^vi and Russell 1000^vii Indexes returning 8.21%, 4.84% and 2.76%, respectively. From an investment style perspective, value stocks significantly outperformed growth stocks, with the Russell 3000 Value^viii and Russell 3000 Growth^ix Indexes returning 6.90% and -0.32%, respectively, over the reporting period.
	Both short- and long-term yields rose over the reporting period, causing the overall bond market to decline. During the six months ended June 30, 2006, two-year Treasury yields increased from 4.41% to 5.16%. Over the same period, 10-year Treasury yields moved from 4.39% to 5.15%. Short-term rates rose in concert with the Fed’s repeated rate hikes, while long-term rates rose on fears of mounting inflationary pressures. Looking at the six-month period as a whole, the overall bond market, as measured by the Lehman Brothers U.S. Aggregate Index^x, returned -0.72%.


	Performance Snapshot as of June 30, 2006 (unaudited)


		6 Months

Variable Appreciation Portfolio¹		3.57%

S&P 500 Index		2.71%

Lipper Variable Large-Cap Core Funds Category Average		1.25%

Variable Fundamental Value Portfolio¹		4.22%

S&P 500 Index		2.71%

Lipper Variable Multi-Cap Core Funds Category Average		3.18%

Variable Capital and Income Portfolio¹		2.35%

S&P 500 Index		2.71%

Lipper Variable Multi-Cap Core Funds Category Average		3.18%


	The performance shown represents past performance. Past performance is no guarantee of future results and current performance may be higher or lower than the performance shown above. Principal value and investment returns will fluctuate and investors’ shares, when redeemed, may be worth more or less than their original cost.

	Performance figures reflect reimbursements and/or fee waivers, without which the performance would have been lower.

	Fund returns assume the reinvestment of all distributions, including returns of capital, if any, at net asset value and the deduction of all Fund expenses.

	Lipper, Inc. is a major independent mutual-fund tracking organization. Returns are based on the six-month period ended June 30, 2006 and include the reinvestment of all distributions, including returns of capital, if any. Returns were calculated among the 222 funds in the variable large-cap core funds category and 189 funds in the variable multi-cap core funds category.

The Fund is an underlying investment option of various variable annuity and variable life insurance products. The Fund’s performance returns do not reflect the deduction of initial sales charges and expenses imposed in connection with investing in variable annuity or variable life insurance contracts, such as administrative fees, account charges, and surrender charges, which, if reflected, would reduce the performance of the Fund. Past performance is no guarantee of future results.

II Legg Mason Partners Variable Portfolios II


	Legg Mason Partners Variable Appreciation Portfolio²

Special Shareholder Notices

As part of the continuing effort to integrate investment products managed by the advisers acquired with Citigroup’s asset management business, Legg Mason, Inc. (“Legg Mason”) has recommended various Fund actions in order to streamline product offerings, eliminate redundancies and improve efficiencies within the organization. At Board meetings held during June and July 2006, the Fund’s Board reviewed and approved these recommendations, and provided authorization to move ahead with proxy solicitations for those matters needing shareholder approval.


	The Fund’s Board has approved the appointment of Legg Mason Partners Fund Advisor, LLC (“LMPFA”) as the Fund’s investment manager effective August 1, 2006. The Fund’s Board has also approved the appointment of CAM North America, LLC (“CAM N.A.”) as the Fund’s subadviser effective August 1, 2006. The portfolio managers who are responsible for the day-to-day management of the Fund remain the same immediately prior to and immediately after the date of these changes. LMPFA and CAM N.A. are wholly-owned subsidiaries of Legg Mason.
	The Fund was formerly known as Greenwich Street Series Fund — Appreciation Portfolio.

Performance Update


	For the six months ended June 30, 2006, the Fund returned 3.57%. The Fund outperformed its unmanaged benchmark, the S&P 500 Index, which returned 2.71% for the same period. It also outperformed the Lipper Variable Large-Cap Core Funds Category Average³, which increased 1.25% over the same time frame.


³	Lipper, Inc. is a major independent mutual-fund tracking organization. Returns are based on the six-month period ended June 30, 2006, including the reinvestment of distributions, including returns of capital, if any, calculated among the 222 funds in the Fund’s Lipper category.

Legg Mason Partners Variable Portfolios II III


	Legg Mason Partners Variable Fundamental Value Portfolio⁴

Special Shareholder Notices


	The Fund’s Board has approved the appointment of Legg Mason Partners Fund Advisor, LLC (“LMPFA”) as the Fund’s investment manager effective August 1, 2006. The Fund’s Board has also approved the appointment of CAM North America, LLC (“CAM N.A.”) as the Fund’s subadviser effective August 1, 2006. The portfolio manager who is responsible for the day-to-day management of the Fund remains the same immediately prior to and immediately after the date of these changes. LMPFA and CAM N.A. are wholly-owned subsidiaries of Legg Mason.
	The Fund was formerly known as Greenwich Street Series Fund — Fundamental Value Portfolio.

Performance Update


	For the six months ended June 30, 2006, the Fund returned 4.22%. The Fund outperformed its unmanaged benchmark, the S&P 500 Index, which returned 2.71% for the same period. It also outperformed the Lipper Variable Multi-Cap Core Funds Category Average⁵, which increased 3.18% over the same time frame.

⁴


⁵	Lipper, Inc. is a major independent mutual-fund tracking organization. Returns are based on the six-month period ended June 30, 2006, including the reinvestment of distributions, including returns of capital, if any, calculated among the 189 funds in the Fund’s Lipper category.

IV Legg Mason Partners Variable Portfolios II


	Legg Mason Partners Variable Capital and Income Portfolio⁶

Special Shareholder Notices


	The Fund’s Board has approved the appointment of Legg Mason Partners Fund Advisor, LLC (“LMPFA”) as the Fund’s investment manager effective August 1, 2006. The Fund’s Board has also approved the appointment of CAM North America, LLC (“CAM N.A.”) and Western Asset Management Company (“Western Asset”) as the Fund’s subadvisers effective August 1, 2006. The portfolio managers who are responsible for the day-to-day management of the Fund remain the same immediately prior to and immediately after the date of these changes. LMPFA, CAM N.A. and Western Asset are wholly-owned subsidiaries of Legg Mason.
	Effective July 17, 2006, Robert Gendelman, a portfolio manager of CAM N.A., assumed management of the equity portion of the Portfolio’s assets and also serves as coordinating portfolio manager.
	The Fund’s Board has also approved a reorganization pursuant to which the Fund’s assets would be acquired, and its liabilities assumed, by the Legg Mason Partners Variable Multiple Discipline Portfolio — Balanced All Cap Growth and Value (the “Acquiring Fund”), in exchange for shares of the Acquiring Fund. The Fund would then be liquidated, and shares of the Acquiring Fund would be distributed to Fund shareholders. Proxy materials describing the reorganization, and other initiatives requiring shareholder approval, are expected to be sent to shareholders later in 2006. If shareholder approval is obtained, Fund actions are generally expected to be implemented during 2007.

⁶

Legg Mason Partners Variable Portfolios II V


	The Fund was formerly known as Greenwich Street Series Fund — Capital and Income Portfolio.

Performance Update


	For the six months ended June 30, 2006, the Fund returned 2.35%. The Fund underperformed its unmanaged benchmark, the S&P 500 Index, which returned 2.71% for the same period. The Lipper Variable Multi-Cap Core Funds Category Average⁷ increased 3.18% over the same time frame.

Information About Your Funds

As you may be aware, several issues in the mutual fund industry have come under the scrutiny of federal and state regulators. Affiliates of the Funds’ Manager have, in recent years, received requests for information from various government regulators regarding market timing, late trading, fees, and other mutual fund issues in connection with various investigations. The regulators appear to be examining, among other things, the Funds’ response to market timing and shareholder exchange activity, including compliance with prospectus disclosure related to these subjects. The Funds are not in a position to predict the outcome of these requests and investigations.


	Important information with regard to recent regulatory developments that may affect the Funds is contained in the Notes to Financial Statements included in this report.

	As always, thank you for your continued confidence in our stewardship of your assets. We look forward to helping you meet your financial goals.

Sincerely,

R. Jay Gerken, CFA

Chairman, President and Chief Executive Officer

July 28, 2006


⁷	Lipper, Inc. is a major independent mutual-fund tracking organization. Returns are based on the six-month period ended June 30, 2006, including the reinvestment of distributions, including returns of capital, if any, calculated among the 189 funds in the Fund’s Lipper category.

VI Legg Mason Partners Variable Portfolios II

The information provided is not intended to be a forecast of future events, a guarantee of future results or investment advice. Views expressed may differ from those of the firm as a whole.

Legg Mason Partners Variable Appreciation Portfolio

RISKS: The portfolio may invest in small-and mid-cap companies that may involve a higher degree of risk and volatility than investments in large-cap companies. Foreign stocks are subject to certain risks of overseas investing including currency fluctuations and changes in political and economic conditions, which could result in significant market fluctuations. The portfolio may use derivatives, such as options and futures, which can be illiquid, may disproportionately increase losses, and have a potentially large impact on portfolio performance. Please see the Fund’s prospectus for more information on these and other risks.

Legg Mason Partners Variable Fundamental Value Portfolio

RISKS: The portfolio may invest in small-and mid-cap companies that may involve a higher degree of risk and volatility than investments in large-cap companies. The portfolio may use derivatives, such as options and futures, which can be illiquid, may disproportionately increase losses, and have a potentially large impact on portfolio performance. Foreign securities are subject to certain risks of overseas investing including currency fluctuations and changes in political and economic conditions, which could result in significant market fluctuations. Please see the Fund’s prospectus for more information on these and other risks.

Legg Mason Partners Variable Capital and Income Portfolio

RISKS: The portfolio may invest in small-and mid-cap companies that may involve a higher degree of risk and volatility than investments in large-cap companies. The Fund may engage in short sales. Losses from short sales may be unlimited. As interest rates rise, bond prices fall, reducing the value of the Fund’s share price. Junk bonds are speculative and their issuers may have diminished capacity to pay principal and interest. Investing in foreign securities is subject to certain risks not associated with domestic investing, such as currency fluctuations, and changes in political and economic conditions. These risks are magnified in emerging or developing markets. The Fund may use derivatives, such as options and futures, which can be illiquid, may disproportionately increase losses, and have a potentially large impact on Fund performance. Please see the Fund’s prospectus for more information on these and other risks.

All index performance reflects no deduction for fees, expenses or taxes. Please note that an investor cannot invest directly in an index.


ⁱ		Gross domestic product is a market value of goods and services produced by labor and property in a given country.

ⁱⁱ		The Federal Reserve Board is responsible for the formulation of a policy designed to promote economic growth, full employment, stable prices, and a sustainable pattern of international trade and payments.

ⁱⁱⁱ		The federal funds rate is the interest rate that banks with excess reserves at a Federal Reserve district bank charge other banks that need overnight loans.

^iv		The S&P 500 Index is an unmanaged index of 500 stocks that is generally representative of the performance of larger companies in the U.S.

^v		The Russell 2000 Index measures the performance of the 2,000 smallest companies in the Russell 3000 Index, which represents approximately 8% of the total market capitalization of the Russell 3000 Index.

^vi		The Russell Midcap Index measures the performance of the 800 smallest companies in the Russell 1000 Index, which represents approximately 25% of the total market capitalization of the Russell 1000 Index.

^vii		The Russell 1000 Index measures the performance of the 1,000 largest companies in the Russell 3000 Index, which represents approximately 92% of the total market capitalization of the Russell 3000 Index.

^viii		The Russell 3000 Value Index measures the performance of those Russell 3000 Index companies with lower price-to-book ratios and lower forecasted growth values. (A price-to-book ratio is the price of a stock compared to the difference between a company’s assets and liabilities.)

^ix		The Russell 3000 Growth Index measures the performance of those Russell 3000 Index companies with higher price-to-book ratios and higher forecasted growth values.

^x		The Lehman Brothers U.S. Aggregate Index is a broad-based bond index comprised of government, corporate, mortgage and asset-backed issues, rated investment grade or higher, and having at least one year to maturity.

Legg Mason Partners Variable Portfolios II VII

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Fund at a Glance (unaudited)

Legg Mason Partners Variable Appreciation Portfolio


	Investment Breakdown

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 1

Fund at a Glance (unaudited) (continued)

Legg Mason Partners Variable Fundamental Value Portfolio


	Investment Breakdown

2 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report

Fund at a Glance (unaudited) (continued)

Legg Mason Partners Variable Capital and Income Portfolio


	Investment Breakdown

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 3

Fund Expenses (unaudited)

Example

As a shareholder of the Fund, you may incur two types of costs: (1) transaction costs and (2) ongoing costs, including management fees and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

This example is based on an investment of $1,000 invested on January 1, 2006 and held for the six months ended June 30, 2006.

Actual Expenses

The table below titled “Based on Actual Total Return” provides information about actual account values and actual expenses. You may use the information provided in this table, together with the amount you invested, to estimate the expenses that you paid over the period. To estimate the expenses you paid on your account, divide your ending account value by $1,000 (for example, an $8,600 ending account value divided by $1,000 = 8.6), then multiply the result by the number under the heading entitled “Expenses Paid During the Period”.


	Based on Actual Total Return (1)


				Beginning		Ending		Annualized			Expenses
	Actual Total			Account		Account		Expense			Paid During
	Return(2)			Value		Value		Ratio			the Period(3)

Legg Mason Partners Variable Appreciation Portfolio		3.57	%	$	1,000.00	$	1,035.70		0.70	%	$	3.53

Legg Mason Partners Variable Fundamental Value Portfolio		4.22			1,000.00		1,042.20		0.76			3.85

Legg Mason Partners Variable Capital and Income Portfolio		2.35			1,000.00		1,023.50		0.86			4.31


⁽¹⁾		For the six months ended June 30, 2006.

⁽²⁾		Assumes reinvestment of all distributions, including returns of capital, if any, at net asset value. Total return is not annualized, as it may not be representative of the total return for the year. Total returns do not reflect expenses associated with the separate account such as administrative fees, account charges and surrender charges, which, if reflected, would reduce the total returns. Performance figures may reflect fee waivers and/or expense reimbursements. Past performance is no guarantee of future results. In the absence of fee waivers and/or expense reimbursements, the total return would have been lower.

⁽³⁾		Expenses (net of fee waivers and/or expense reimbursements) are equal to each Fund’s respective annualized expense ratio multiplied by the average account value over the period, multiplied by the number of days in the most recent fiscal half-year, then divided by 365.

4 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report

Fund Expenses (unaudited) (continued)

Hypothetical Example for Comparison Purposes

The table below titled “Based on Hypothetical Total Return” provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio and an assumed rate of return of 5.00% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use the information provided in this table to compare the ongoing costs of investing in the Fund and other funds. To do so, compare the 5.00% hypothetical example relating to the Fund with the 5.00% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table below are meant to highlight your ongoing costs only and do not reflect any transactional costs. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.


	Based on Hypothetical Total Return (1)


	Hypothetical
	Annualized			Beginning		Ending		Annualized			Expenses
	Total			Account		Account		Expense			Paid During
	Return			Value		Value		Ratio			the Period(2)

Legg Mason Partners Variable Appreciation Portfolio		5.00	%	$	1,000.00	$	1,021.32		0.70	%	$	3.51

Legg Mason Partners Variable Fundamental Value Portfolio		5.00			1,000.00		1,021.03		0.76			3.81

Legg Mason Partners Variable Capital and Income Portfolio		5.00			1,000.00		1,020.53		0.86			4.31


⁽¹⁾		For the six months ended June 30, 2006.

⁽²⁾		Expenses (net of fee waivers and/or expense reimbursements) are equal to each Fund’s respective annualized expense ratio multiplied by the average account value over the period, multiplied by the number of days in the most recent fiscal half year, then divided by 365.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 5


	Schedules of Investments (June 30, 2006) (unaudited)

LEGG MASON PARTNERS VARIABLE APPRECIATION PORTFOLIO


Shares		Security	Value

COMMON STOCKS — 97.1%
CONSUMER DISCRETIONARY — 7.8%
Diversified Consumer Services — 0.2%
	148,000	ServiceMaster Co.	$	1,528,840

Hotels, Restaurants & Leisure — 0.7%
	104,000	Marcus Corp.		2,171,520
	104,900	McDonald’s Corp.		3,524,640

		Total Hotels, Restaurants & Leisure		5,696,160

Internet & Catalog Retail — 0.7%
	90,000	Amazon.com Inc.*		3,481,200
	104,200	eBay Inc.*		3,052,018

		Total Internet & Catalog Retail		6,533,218

Media — 5.4%
	45,078	CBS Corp., Class B Shares		1,219,360
	122,200	Gannett Co. Inc.		6,834,646
	7,300	Liberty Media Holding Corp. — Capital Group, Series A Shares*		611,521
	36,500	Liberty Media Holding Corp. — Interactive Group, Series A Shares*		629,990
	60,800	Meredith Corp.		3,012,032
	411,200	Sirius Satellite Radio Inc.*		1,953,200
	890,825	Time Warner Inc.		15,411,272
	45,078	Viacom Inc., Class B Shares*		1,615,596
	519,100	Walt Disney Co.		15,573,000

		Total Media		46,860,617

Specialty Retail — 0.8%
	192,600	Home Depot Inc.		6,893,154

		TOTAL CONSUMER DISCRETIONARY		67,511,989

CONSUMER STAPLES — 12.4%
Beverages — 1.8%
	259,880	PepsiCo Inc.		15,603,195

Food & Staples Retailing — 4.2%
	153,000	Costco Wholesale Corp.		8,740,890
	370,748	Wal-Mart Stores Inc.		17,858,931
	210,400	Walgreen Co.		9,434,336

		Total Food & Staples Retailing		36,034,157

See Notes to Financial Statements.

6 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Shares		Security	Value

Food Products — 3.4%
	172,170	Cadbury Schweppes PLC, Sponsored ADR	$	6,683,640
	92,000	Dean Foods Co.*		3,421,480
	151,000	General Mills Inc.		7,800,660
	65,600	H.J. Heinz Co.		2,704,032
	31,100	Hershey Co.		1,712,677
	160,875	Wm. Wrigley Jr. Co.		7,297,290

		Total Food Products		29,619,779

Household Products — 3.0%
	152,400	Kimberly-Clark Corp.		9,403,080
	295,530	Procter & Gamble Co.		16,431,468

		Total Household Products		25,834,548

		TOTAL CONSUMER STAPLES		107,091,679

ENERGY — 8.3%
Energy Equipment & Services — 1.3%
	78,000	ENSCO International Inc.		3,589,560
	46,600	National-Oilwell Varco Inc.*		2,950,712
	76,800	Schlumberger Ltd.		5,000,448

		Total Energy Equipment & Services		11,540,720

Oil, Gas & Consumable Fuels — 7.0%
	76,100	BP PLC, Sponsored ADR		5,297,321
	177,940	Canadian Natural Resources Ltd.		9,854,317
	105,400	Cimarex Energy Co.		4,532,200
	252,164	EnCana Corp.		13,273,913
	400,718	Exxon Mobil Corp.		24,584,049
	29,850	Suncor Energy Inc.		2,418,149

		Total Oil, Gas & Consumable Fuels		59,959,949

		TOTAL ENERGY		71,500,669

EXCHANGE TRADED FUNDS — 1.2%
	480,000	iShares MSCI Japan Index Fund		6,547,200
	62,100	streetTRACKS Gold Trust*		3,802,383

		TOTAL EXCHANGE TRADED FUNDS		10,349,583

FINANCIALS — 17.6%
Capital Markets — 1.9%
	151,000	Bank of New York Co. Inc.		4,862,200
	19,500	Goldman Sachs Group Inc.		2,933,385
	118,400	Merrill Lynch & Co. Inc.		8,235,904

		Total Capital Markets		16,031,489

Commercial Banks — 2.0%
	252,200	Wells Fargo & Co.		16,917,576

See Notes to Financial Statements.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 7


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Shares		Security	Value

Consumer Finance — 0.9%
	149,200	American Express Co.	$	7,940,424

Diversified Financial Services — 2.2%
	256,000	Bank of America Corp.		12,313,600
	153,040	JPMorgan Chase & Co.		6,427,680

		Total Diversified Financial Services		18,741,280

Insurance — 8.3%
	593	Berkshire Hathaway Inc., Class A Shares*		54,353,787
	155,000	Marsh & McLennan Cos. Inc.		4,167,950
	297,000	St. Paul Travelers Cos. Inc.		13,240,260

		Total Insurance		71,761,997

Real Estate Management & Development — 1.9%
	326,100	Forest City Enterprises Inc., Class A Shares		16,275,651

Thrifts & Mortgage Finance — 0.4%
	106,000	Brookline Bancorp Inc.		1,459,620
	150,000	Hudson City Bancorp Inc.		1,999,500

		Total Thrifts & Mortgage Finance		3,459,120

		TOTAL FINANCIALS		151,127,537

HEALTH CARE — 7.0%
Biotechnology — 1.6%
	133,850	Amgen Inc.*		8,731,036
	44,700	Charles River Laboratories International, Inc.*		1,644,960
	45,000	Genentech Inc.*		3,681,000

		Total Biotechnology		14,056,996

Health Care Equipment & Supplies — 0.9%
	31,200	IDEXX Laboratories Inc.*		2,344,056
	105,300	Medtronic Inc.		4,940,676

		Total Health Care Equipment & Supplies		7,284,732

Health Care Providers & Services — 0.5%
	104,800	UnitedHealth Group Inc.		4,692,944

Pharmaceuticals — 4.0%
	77,000	Bristol-Myers Squibb Co.		1,991,220
	274,808	Johnson & Johnson		16,466,495
	446,136	Pfizer Inc.		10,470,812
	120,000	Wyeth		5,329,200

		Total Pharmaceuticals		34,257,727

		TOTAL HEALTH CARE		60,292,399

See Notes to Financial Statements.

8 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Shares		Security	Value

INDUSTRIALS — 20.7%
Aerospace & Defense — 3.9%
	153,000	Honeywell International Inc.	$	6,165,900
	237,500	Raytheon Co.		10,585,375
	267,700	United Technologies Corp.		16,977,534

		Total Aerospace & Defense		33,728,809

Air Freight & Logistics — 1.9%
	193,500	United Parcel Service Inc., Class B Shares		15,930,855

Airlines — 0.6%
	298,500	Southwest Airlines Co.		4,886,445

Building Products — 0.5%
	150,000	Masco Corp.		4,446,000

Commercial Services & Supplies — 2.5%
	153,500	Covanta Holding Corp.*		2,709,275
	178,000	Pitney Bowes Inc.		7,351,400
	326,400	Waste Management Inc.		11,711,232

		Total Commercial Services & Supplies		21,771,907

Electrical Equipment — 0.4%
	181,000	American Power Conversion Corp.		3,527,690

Industrial Conglomerates — 9.8%
	373,700	3M Co.		30,183,749
	1,272,719	General Electric Co.		41,948,818
	445,500	Tyco International Ltd.		12,251,250

		Total Industrial Conglomerates		84,383,817

Road & Rail — 1.1%
	185,669	Florida East Coast Industries Inc.		9,716,059

		TOTAL INDUSTRIALS		178,391,582

INFORMATION TECHNOLOGY — 15.4%
Communications Equipment — 2.9%
	1,055,000	3Com Corp.*		5,401,600
	741,450	Cisco Systems Inc.*		14,480,518
	151,000	Motorola Inc.		3,042,650
	60,000	QUALCOMM Inc.		2,404,200

		Total Communications Equipment		25,328,968

Computers & Peripherals — 3.4%
	817,500	EMC Corp.*		8,967,975
	226,100	Hewlett-Packard Co.		7,162,848
	170,550	International Business Machines Corp.		13,101,651

		Total Computers & Peripherals		29,232,474

See Notes to Financial Statements.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 9


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Shares		Security	Value

Internet Software & Services — 3.1%
	13,400	Google Inc., Class A Shares*	$	5,619,022
	410,000	VeriSign Inc.*		9,499,700
	341,500	Yahoo! Inc.*		11,269,500

		Total Internet Software & Services		26,388,222

IT Services — 1.5%
	211,000	Automatic Data Processing Inc.		9,568,850
	75,000	First Data Corp.		3,378,000

		Total IT Services		12,946,850

Semiconductors & Semiconductor Equipment — 0.9%
	154,512	Freescale Semiconductor Inc., Class B Shares*		4,542,653
	154,529	Intel Corp.		2,928,324

		Total Semiconductors & Semiconductor Equipment		7,470,977

Software — 3.6%
	1,347,236	Microsoft Corp.		31,390,599

		TOTAL INFORMATION TECHNOLOGY		132,758,090

MATERIALS — 4.8%
Chemicals — 4.2%
	30,000	Ashland Inc.		2,001,000
	126,000	Cytec Industries Inc.		6,761,160
	79,000	Dow Chemical Co.		3,083,370
	223,000	E.I. du Pont de Nemours & Co.		9,276,800
	138,000	Ecolab Inc.		5,600,040
	140,800	PPG Industries Inc.		9,292,800

		Total Chemicals		36,015,170

Metals & Mining — 0.6%
	151,700	Alcoa Inc.		4,909,012

		TOTAL MATERIALS		40,924,182

TELECOMMUNICATION SERVICES — 1.2%
Diversified Telecommunication Services — 0.1%
	14,500	Verizon Communications Inc.		485,605

Wireless Telecommunication Services — 1.1%
	148,000	ALLTEL Corp.		9,446,840

		TOTAL TELECOMMUNICATION SERVICES		9,932,445

UTILITIES — 0.7%
Electric Utilities — 0.7%
	212,160	Duke Energy Corp.		6,231,139

		TOTAL INVESTMENTS BEFORE SHORT-TERM INVESTMENT
		(Cost — $666,261,089)		836,111,294

See Notes to Financial Statements.

10 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Face
Amount		Security	Value

SHORT-TERM INVESTMENT — 3.1%
Repurchase Agreement — 3.1%
$	26,721,000	Greenwich Capital Markets Inc. repurchase agreement dated 6/30/06, 4.500% due 7/3/06; Proceeds at maturity — $26,731,020; (Fully collateralized by various U.S. government agency obligations, 3.310% to 6.250% due 1/2/07 to 1/2/14; Market value — $27,260,103) (Cost — $26,721,000)	$	26,721,000

		TOTAL INVESTMENTS — 100.2% (Cost — $692,982,089#)		862,832,294
		Liabilities in Excess of Other Assets — (0.2)%		(2,073,300	)

		TOTAL NET ASSETS — 100.0%	$	860,758,994


*		Non-income producing security.

^#		Aggregate cost for federal income tax purposes is substantially the same.

		Abbreviation used in this schedule:


ADR		— American Depositary Receipt

See Notes to Financial Statements.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 11


	Schedules of Investments (June 30, 2006) (unaudited) (continued)

LEGG MASON PARTNERS VARIABLE FUNDAMENTAL VALUE PORTFOLIO


Shares		Security	Value

COMMON STOCKS — 91.3%
CONSUMER DISCRETIONARY — 13.1%
Auto Components — 0.7%
	295,500	Lear Corp.	$	6,563,055

Leisure Equipment & Products — 0.6%
	290,600	Hasbro Inc.		5,262,766

Media — 9.9%
	1,261,400	Interpublic Group of Cos. Inc..*		10,532,690
	1,233,500	News Corp., Class B Shares		24,892,030
	1,359,900	Pearson PLC		18,516,459
	899,750	Time Warner Inc.		15,565,675
	647,400	Walt Disney Co.		19,422,000

		Total Media		88,928,854

Specialty Retail — 1.9%
	474,100	Home Depot Inc.		16,968,039

		TOTAL CONSUMER DISCRETIONARY		117,722,714

CONSUMER STAPLES — 6.7%
Beverages — 0.6%
	73,200	Molson Coors Brewing Co., Class B Shares		4,968,816

Food & Staples Retailing — 3.0%
	491,025	Safeway Inc.		12,766,650
	301,400	Wal-Mart Stores Inc.		14,518,438

		Total Food & Staples Retailing		27,285,088

Food Products — 2.7%
	289,900	Kraft Foods Inc., Class A Shares		8,957,910
	263,250	Unilever PLC		5,918,071
	400,140	Unilever PLC, Sponsored ADR		9,019,155

		Total Food Products		23,895,136

Household Products — 0.4%
	57,100	Kimberly-Clark Corp.		3,523,070

		TOTAL CONSUMER STAPLES		59,672,110

ENERGY — 9.2%
Energy Equipment & Services — 3.2%
	109,000	Baker Hughes Inc.		8,921,650
	145,400	GlobalSantaFe Corp.		8,396,850
	156,000	Halliburton Co.		11,576,760

		Total Energy Equipment & Services		28,895,260

See Notes to Financial Statements.

12 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Shares		Security	Value

Oil, Gas & Consumable Fuels — 6.0%
	170,000	Anadarko Petroleum Corp.	$	8,107,300
	25,100	BP PLC, Sponsored ADR		1,747,211
	102,800	Chevron Corp.		6,379,768
	72,200	ConocoPhillips		4,731,266
	111,300	Devon Energy Corp.		6,723,633
	119,400	Exxon Mobil Corp.		7,325,190
	187,700	Murphy Oil Corp.		10,484,922
	367,290	Williams Cos. Inc.		8,579,894

		Total Oil, Gas & Consumable Fuels		54,079,184

		TOTAL ENERGY		82,974,444

FINANCIALS — 18.1%
Capital Markets — 3.6%
	30,100	Franklin Resources Inc.		2,612,981
	17,300	Goldman Sachs Group Inc.		2,602,439
	266,000	Merrill Lynch & Co. Inc.		18,502,960
	148,900	State Street Corp.		8,649,601

		Total Capital Markets		32,367,981

Commercial Banks — 1.8%
	1,147	Mitsubishi UFJ Financial Group Inc.		16,027,248

Consumer Finance — 1.2%
	201,700	American Express Co.		10,734,474

Diversified Financial Services — 4.6%
	402,978	Bank of America Corp.		19,383,242
	522,400	JPMorgan Chase & Co.		21,940,800

		Total Diversified Financial Services		41,324,042

Insurance — 3.7%
	164,200	American International Group Inc.		9,696,010
	273,400	Chubb Corp.		13,642,660
	192,415	CNA Surety Corp.*		3,324,931
	77,600	Hartford Financial Services Group Inc.		6,564,960

		Total Insurance		33,228,561

Thrifts & Mortgage Finance — 3.2%
	144,100	MGIC Investment Corp.		9,366,500
	423,600	PMI Group Inc.		18,884,088

		Total Thrifts & Mortgage Finance		28,250,588

		TOTAL FINANCIALS		161,932,894

HEALTH CARE — 12.5%
Biotechnology — 0.5%
	70,700	Amgen Inc.*		4,611,761

Health Care Equipment & Supplies — 0.1%
	9,400	Medtronic Inc.		441,048

See Notes to Financial Statements.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 13


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Shares		Security	Value

Life Sciences Tools & Services — 0.6%
	346,896	Enzo Biochem Inc.*	$	5,231,192

Pharmaceuticals — 11.3%
	430,200	Abbott Laboratories		18,761,022
	206,500	Bentley Pharmaceuticals Inc.*		2,263,240
	163,800	Eli Lilly & Co.		9,053,226
	232,900	GlaxoSmithKline PLC, Sponsored ADR		12,995,820
	236,900	Johnson & Johnson		14,195,048
	171,700	Novartis AG, Sponsored ADR		9,258,064
	720,100	Pfizer Inc.		16,900,747
	403,100	Wyeth		17,901,671

		Total Pharmaceuticals		101,328,838

		TOTAL HEALTH CARE		111,612,839

INDUSTRIALS — 9.2%
Aerospace & Defense — 5.0%
	119,500	Boeing Co.		9,788,245
	469,500	Honeywell International Inc.		18,920,850
	366,600	Raytheon Co.		16,339,362

		Total Aerospace & Defense		45,048,457

Airlines — 1.4%
	760,800	Southwest Airlines Co.		12,454,296

Electrical Equipment — 0.5%
	50,000	Emerson Electric Co.		4,190,500

Machinery — 2.3%
	208,700	Caterpillar Inc.		15,543,976
	64,000	Deere & Co.		5,343,360

		Total Machinery		20,887,336

		TOTAL INDUSTRIALS		82,580,589

INFORMATION TECHNOLOGY — 14.8%
Communications Equipment — 4.3%
	1,016,000	Cisco Systems Inc.*		19,842,480
	481,000	Motorola Inc.		9,692,150
	440,700	Nokia Oyj, Sponsored ADR		8,928,582

		Total Communications Equipment		38,463,212

Computers & Peripherals — 1.5%
	143,400	International Business Machines Corp.		11,015,988
	45,900	Lexmark International Inc., Class A Shares*		2,562,597

		Total Computers & Peripherals		13,578,585

Electronic Equipment & Instruments — 1.0%
	286,700	Agilent Technologies Inc.*		9,048,252
	60,000	International DisplayWorks Inc.*		312,000

		Total Electronic Equipment & Instruments		9,360,252

See Notes to Financial Statements.

14 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Shares		Security	Value

Internet Software & Services — 1.0%
	199,700	eBay Inc.*	$	5,849,213
	101,800	VeriSign Inc.*		2,358,706
	27,700	Yahoo! Inc.*		914,100

		Total Internet Software & Services		9,122,019

Semiconductors & Semiconductor Equipment — 5.4%
	548,400	Applied Materials Inc.		8,927,952
	122,900	Intel Corp.		2,328,955
	270,100	Novellus Systems Inc.*		6,671,470
	33,300	Samsung Electronics Co., Ltd., GDR (a)		10,464,525
	1,197,284	Taiwan Semiconductor Manufacturing Co., Ltd., Sponsored ADR		10,991,068
	287,600	Texas Instruments Inc.		8,711,404

		Total Semiconductors & Semiconductor Equipment		48,095,374

Software — 1.6%
	617,800	Microsoft Corp.		14,394,740
	179,100	Wave Systems Corp., Class A*		119,997

		Total Software		14,514,737

		TOTAL INFORMATION TECHNOLOGY		133,134,179

MATERIALS — 5.8%
Chemicals — 2.6%
	236,400	Dow Chemical Co.		9,226,692
	338,500	E.I. du Pont de Nemours & Co.		14,081,600

		Total Chemicals		23,308,292

Metals & Mining — 2.1%
	358,000	Alcoa Inc.		11,584,880
	126,000	RTI International Metals Inc.*		7,035,840
	249,100	WGI Heavy Minerals Inc.*		201,067

		Total Metals & Mining		18,821,787

Paper & Forest Products — 1.1%
	164,500	Weyerhaeuser Co.		10,240,125

		TOTAL MATERIALS		52,370,204

TELECOMMUNICATION SERVICES — 1.9%
Wireless Telecommunication Services — 1.9%
	41,400	Sprint Nextel Corp.		827,586
	773,900	Vodafone Group PLC, Sponsored ADR		16,484,070

		TOTAL TELECOMMUNICATION SERVICES		17,311,656

		TOTAL INVESTMENTS BEFORE SHORT-TERM INVESTMENT (Cost — $665,974,802)		819,311,629

See Notes to Financial Statements.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 15


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Face
Amount		Security	Value

SHORT-TERM INVESTMENT — 8.7%
Repurchase Agreement — 8.7%
$	77,561,000	Interest in $331,346,000 joint tri-party repurchase agreement dated 6/30/06 with Greenwich Capital Markets Inc., 5.200% due 7/3/06; Proceeds at maturity — $77,594,610; (Fully collateralized by various U.S. government agency obligations, 0.000% to 6.331% due 9/1/24 to 5/1/38; Market value — $79,112,439) (Cost — $77,561,000)	$	77,561,000

		TOTAL INVESTMENTS — 100.0% (Cost — $743,535,802#)		896,872,629
		Other Assets in Excess of Liabilities — 0.0%		225,579

		TOTAL NET ASSETS — 100.0%	$	897,098,208


*		Non-income producing security.

^(a)		Security is exempt from registration under Rule 144A of the Securities Act of 1933. This security may be resold in transactions that are exempt from registration, normally to qualified institutional buyers. This security has been deemed liquid pursuant to guidelines approved by the Board of Trustees, unless otherwise noted.

^#		Aggregate cost for federal income tax purposes is substantially the same.

		Abbreviations used in this schedule:


ADR		— American Depositary Receipt
GDR		— Global Depositary Receipt

See Notes to Financial Statements.

16 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report


	Schedules of Investments (June 30, 2006) (unaudited) (continued)

LEGG MASON PARTNERS VARIABLE CAPITAL AND INCOME PORTFOLIO


Shares		Security	Value

COMMON STOCKS — 43.0%
CONSUMER DISCRETIONARY — 5.3%
Hotels, Restaurants & Leisure — 0.9%
	400	Ctrip.com International Ltd., ADR	$	20,420
	14,700	McDonald’s Corp. (a)		493,920
	1,500	OSI Restaurant Partners Inc.		51,900

		Total Hotels, Restaurants & Leisure		566,240

Household Durables — 0.8%
	4,000	Fortune Brands Inc.		284,040
	6,700	Newell Rubbermaid Inc.		173,061
	3,700	Toll Brothers Inc.*		94,609

		Total Household Durables		551,710

Leisure Equipment & Products — 0.0%
	1,300	Marvel Entertainment Inc.*		26,000

Media — 2.4%
	700	Cablevision Systems Corp., New York Group, Class A Shares		15,015
	2,000	Clear Channel Communications Inc.		61,900
	9,000	EchoStar Communications Corp., Class A Shares*		277,290
	7,600	Interpublic Group of Cos. Inc.*		63,460
	2,953	Liberty Global Inc., Series A Shares*		63,490
	9,163	Liberty Global Inc., Series C Shares*		188,483
	620	Liberty Media Holding Corp. — Capital Group, Series A Shares*		51,937
	1,100	Liberty Media Holding Corp. — Interactive Group, Series A Shares*		18,986
	13,900	News Corp., Class B Shares		280,502
	7,005	NTL Inc.		174,424
	1,800	R.H. Donnelley Corp.*		97,326
	3,000	Regal Entertainment Group, Class A Shares		60,960
	14,300	SES Global SA, FDR		203,747
	2,700	Time Warner Inc.		46,710

		Total Media		1,604,230

Specialty Retail — 1.2%
	4,900	Bed Bath & Beyond Inc.*		162,533
	13,800	Home Depot Inc.		493,902
	7,500	Urban Outfitters Inc.*		131,175

		Total Specialty Retail		787,610

		TOTAL CONSUMER DISCRETIONARY		3,535,790

See Notes to Financial Statements.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 17


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Shares		Security	Value

CONSUMER STAPLES — 3.6%
Food & Staples Retailing — 1.5%
	13,200	Kroger Co.	$	288,552
	8,200	Sysco Corp.		250,592
	9,800	Wal-Mart Stores Inc.		472,066

		Total Food & Staples Retailing		1,011,210

Food Products — 0.7%
	2,500	Kellogg Co.		121,075
	5,600	McCormick & Co. Inc., Non Voting Shares		187,880
	2,000	Wm. Wrigley Jr. Co.		90,720
	500	Wm. Wrigley Jr. Co., Class B Shares		22,650

		Total Food Products		422,325

Household Products — 0.7%
	4,200	Kimberly-Clark Corp.		259,140
	4,087	Procter & Gamble Co.		227,237

		Total Household Products		486,377

Tobacco — 0.7%
	6,200	Altria Group Inc.		455,266

		TOTAL CONSUMER STAPLES		2,375,178

ENERGY — 5.5%
Energy Equipment & Services — 2.5%
	5,300	Cameron International Corp.*		253,181
	2,600	Diamond Offshore Drilling Inc.		218,218
	7,350	ENSCO International Inc.		338,247
	1,800	GlobalSantaFe Corp.		103,950
	3,000	Halliburton Co.		222,630
	1,500	National-Oilwell Varco Inc.*		94,980
	10,000	Pride International Inc.*		312,300
	3,000	Rowan Cos. Inc.		106,770

		Total Energy Equipment & Services		1,650,276

Oil, Gas & Consumable Fuels — 3.0%
	1,900	ConocoPhillips		124,507
	4,300	Marathon Oil Corp.		358,190
	4,800	Nexen Inc.		271,392
	12,000	OPTI Canada Inc.*		245,920
	2,000	Suncor Energy Inc.		162,020
	10,100	Total SA, Sponsored ADR (a)		661,752
	5,900	Williams Cos. Inc.		137,824

		Total Oil, Gas & Consumable Fuels		1,961,605

		TOTAL ENERGY		3,611,881

See Notes to Financial Statements.

18 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Shares		Security	Value

FINANCIALS — 11.5%
Capital Markets — 0.5%
	350	Goldman Sachs Group Inc.	$	52,650
	700	Lehman Brothers Holdings Inc.		45,605
	2,935	Merrill Lynch & Co. Inc.		204,159

		Total Capital Markets		302,414

Commercial Banks — 0.6%
	6,050	Wells Fargo & Co.		405,834

Consumer Finance — 1.8%
	9,150	American Express Co. (a)		486,963
	7,902	Capital One Financial Corp. (a)(b)		675,226

		Total Consumer Finance		1,162,189

Diversified Financial Services — 0.6%
	4,100	Bank of America Corp.		197,210
	4,860	JPMorgan Chase & Co.		204,120

		Total Diversified Financial Services		401,330

Insurance — 1.7%
	3,530	AFLAC Inc.		163,616
	30	Berkshire Hathaway Inc., Class B Shares*		91,290
	6,700	Chubb Corp.		334,330
	14,260	Marsh & McLennan Cos. Inc.		383,451
	3,860	St. Paul Travelers Cos. Inc.		172,079

		Total Insurance		1,144,766

Real Estate Investment Trusts (REITs) — 5.0%
	1,200	Alexandria Real Estate Equities Inc.		106,416
	4,200	AMB Property Corp.		212,310
	2,200	Archstone-Smith Trust		111,914
	1,500	Avalonbay Communities Inc.		165,930
	2,300	BioMed Realty Trust Inc.		68,862
	1,200	Boston Properties Inc.		108,480
	600	BRE Properties Inc., Class A Shares		33,000
	800	Developers Diversified Realty Corp.		41,744
	1,300	Duke Realty Corp.		45,695
	2,800	Equity Office Properties Trust		102,228
	3,200	Equity Residential		143,136
	1,900	Federal Realty Investment Trust		133,000
	4,200	General Growth Properties Inc.		189,252
	600	Global Signal Inc.		27,792
	1,500	Gramercy Capital Corp.		38,850
	500	Heritage Property Investment Trust		17,460
	1,900	Highwoods Properties Inc.		68,742
	8,651	Host Marriott Corp.		189,197
	2,000	iStar Financial Inc.		75,500
	1,700	Kimco Realty Corp.		62,033
	440	Macerich Co.		30,888

See Notes to Financial Statements.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 19


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Shares		Security	Value

Real Estate Investment Trusts (REITs) — 5.0% (continued)
	440	Pan Pacific Retail Properties Inc.	$	30,523
	6,100	ProLogis		317,932
	2,400	PS Business Parks Inc.		141,600
	1,300	Public Storage Inc.		98,670
	1,300	Reckson Associates Realty Corp.		53,794
	3,300	Republic Property Trust		32,604
	2,500	Simon Property Group Inc.		207,350
	2,300	SL Green Realty Corp.		251,781
	1,900	Vornado Realty Trust		185,345

		Total Real Estate Investment Trusts (REITs)		3,292,028

Thrifts & Mortgage Finance — 1.3%
	5,800	Freddie Mac		330,658
	5,760	Golden West Financial Corp.		427,392
	10,200	Hudson City Bancorp Inc.		135,966

		Total Thrifts & Mortgage Finance		894,016

		TOTAL FINANCIALS		7,602,577

HEALTH CARE — 5.1%
Biotechnology — 1.1%
	4,400	Amgen Inc.*		287,012
	2,100	CV Therapeutics Inc.*		29,337
	4,200	Cytori Therapeutics Inc.*		30,198
	700	Genentech Inc.*		57,260
	1,500	Genzyme Corp.*		91,575
	2,100	InterMune Inc.*		34,545
	1,300	Invitrogen Corp.*		85,891
	2,500	PDL BioPharma Inc.*		46,025
	1,484	Vertex Pharmaceuticals Inc.*		54,478

		Total Biotechnology		716,321

Health Care Equipment & Supplies — 0.4%
	6,900	Boston Scientific Corp.*		116,196
	2,000	Cooper Cos. Inc.		88,580
	2,500	DJ Orthopedics Inc.*		92,075

		Total Health Care Equipment & Supplies		296,851

Health Care Providers & Services — 1.3%
	600	Aetna Inc.		23,958
	1,700	Coventry Health Care Inc.*		93,398
	2,500	DaVita Inc.*		124,250
	3,000	Omnicare Inc.		142,260
	2,870	UnitedHealth Group Inc.		128,518
	5,100	WellPoint Inc.*		371,127

		Total Health Care Providers & Services		883,511

See Notes to Financial Statements.

20 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Shares		Security	Value

Pharmaceuticals — 2.3%
	6,000	Abbott Laboratories	$	261,660
	1,100	GlaxoSmithKline PLC, Sponsored ADR		61,380
	3,000	Kos Pharmaceuticals Inc.*		112,860
	4,600	Novartis AG, Sponsored ADR		248,032
	4,600	Pfizer Inc.		107,962
	900	Sanofi-Aventis		87,750
	3,500	Sanofi-Aventis, ADR		170,450
	8,500	Schering-Plough Corp.		161,755
	1,400	Sepracor Inc.*		79,996
	1,000	Teva Pharmaceutical Industries Ltd., Sponsored ADR		31,590
	3,900	Wyeth		173,199

		Total Pharmaceuticals		1,496,634

		TOTAL HEALTH CARE		3,393,317

INDUSTRIALS — 3.2%
Aerospace & Defense — 1.3%
	8,000	Boeing Co. (a)		655,280
	5,500	Raytheon Co.		245,135

		Total Aerospace & Defense		900,415

Building Products — 0.2%
	4,700	Masco Corp.		139,308

Commercial Services & Supplies — 0.1%
	1,200	Avery Dennison Corp.		69,672
	800	IHS Inc., Class A Shares*		23,704

		Total Commercial Services & Supplies		93,376

Industrial Conglomerates — 0.9%
	17,500	General Electric Co. (a)(b)		576,800

Machinery — 0.6%
	1,700	Deere & Co.		141,933
	3,400	Parker Hannifin Corp.		263,840

		Total Machinery		405,773

Trading Companies & Distributors — 0.1%
	800	MSC Industrial Direct Co. Inc., Class A Shares		38,056

		TOTAL INDUSTRIALS		2,153,728

See Notes to Financial Statements.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 21


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Shares		Security	Value

INFORMATION TECHNOLOGY — 4.2%
Communications Equipment — 1.2%
	6,858	ADC Telecommunications Inc.*	$	115,626
	9,500	Cisco Systems Inc.*		185,535
	8,800	Comverse Technology Inc.*		173,976
	10,900	Juniper Networks Inc.*		174,291
	1,700	MasTec Inc.*		22,457
	6,100	Nokia Oyj, Sponsored ADR		123,586

		Total Communications Equipment		795,471

Computers & Peripherals — 0.3%
	57,400	Sun Microsystems Inc.*		238,210

Electronic Equipment & Instruments — 0.0%
	200	Dolby Laboratories Inc., Class A Shares*		4,660

Internet Software & Services — 0.7%
	7,400	Digitas Inc.*		85,988
	3,200	Jupitermedia Corp.*		41,600
	1,900	Openwave Systems Inc.*		21,926
	5,500	RealNetworks Inc.*		58,850
	4,800	SINA Corp.*		119,904
	5,000	Sohu.com Inc.*		128,950

		Total Internet Software & Services		457,218

IT Services — 0.4%
	4,000	MasterCard Inc., Class A*		192,000
	1,800	Wright Express Corp.*		51,732

		Total IT Services		243,732

Semiconductors & Semiconductor Equipment — 0.3%
	4,620	Advanced Micro Devices Inc.*		112,820
	3,300	ASML Holding NV, NY Registered Shares*		66,726

		Total Semiconductors & Semiconductor Equipment		179,546

Software — 1.3%
	10,500	Adobe Systems Inc.*		318,780
	22,200	Microsoft Corp. (a)		517,260

		Total Software		836,040

		TOTAL INFORMATION TECHNOLOGY		2,754,877

MATERIALS — 1.2%
Chemicals — 0.7%
	5,000	Air Products & Chemicals Inc.		319,600
	57	Arkema, Sponsored ADR*		2,224
	4,100	E.I. du Pont de Nemours & Co.		170,560

		Total Chemicals		492,384

See Notes to Financial Statements.

22 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Shares		Security	Value

Metals & Mining — 0.5%
	5,100	Barrick Gold Corp.	$	150,960
	6,100	Compass Minerals International Inc.		152,195

		Total Metals & Mining		303,155

		TOTAL MATERIALS		795,539

TELECOMMUNICATION SERVICES — 2.0%
Diversified Telecommunication Services — 0.5%
	3,400	Citizens Communications Co.		44,370
	4,432	Embarq Corp.*		181,668
	2,600	PanAmSat Holding Corp.		64,948
	3,700	Time Warner Telecom Inc., Class A Shares*		54,945

		Total Diversified Telecommunication Services		345,931

Wireless Telecommunication Services — 1.5%
	7,400	ALLTEL Corp. (a)		472,342
	2,245	American Tower Corp., Class A Shares*		69,864
	10,000	Dobson Communications Corp., Class A Shares*		77,300
	16,943	Sprint Nextel Corp.		338,691
	2,043	WiderThan Co., Ltd., ADR*		21,022

		Total Wireless Telecommunication Services		979,219

		TOTAL TELECOMMUNICATION SERVICES		1,325,150

UTILITIES — 1.4%
Electric Utilities — 0.3%
	2,000	Entergy Corp.		141,500
	1,850	ITC Holdings Corp.		49,173

		Total Electric Utilities		190,673

Independent Power Producers & Energy Traders — 0.5%
	6,200	Mirant Corp.*		166,160
	1,400	NRG Energy Inc.*		67,452
	2,100	TXU Corp.		125,559

		Total Independent Power Producers & Energy Traders		359,171

Multi-Utilities — 0.6%
	8,700	Sempra Energy		395,676

		TOTAL UTILITIES		945,520

		TOTAL COMMON STOCKS (Cost — $27,071,280)		28,493,557

CONVERTIBLE PREFERRED STOCKS — 0.8%
CONSUMER DISCRETIONARY — 0.3%
Hotels, Restaurants & Leisure — 0.3%
	9,500	Six Flags Inc., 7.250%		205,200

See Notes to Financial Statements.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 23


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Shares		Security	Value

ENERGY — 0.1%
Energy Equipment & Services — 0.1%
	1,150	Hanover Compressor Capital Trust, 7.250% due 12/15/29	$	64,687

FINANCIALS — 0.4%
Real Estate Investment Trusts (REITs) — 0.2%
	1,500	Simon Property Group Inc., 6.000% due 12/31/49		102,750

Thrifts & Mortgage Finance — 0.2%
	3,000	Sovereign Capital Trust IV, 4.375% due 3/1/34		136,500

		TOTAL FINANCIALS		239,250

		TOTAL CONVERTIBLE PREFERRED STOCKS (Cost — $502,667)		509,137

PREFERRED STOCKS — 0.0%
ENERGY — 0.0%
Oil, Gas & Consumable Fuels — 0.0%
	33	Chesapeake Energy Corp., 6.250%		8,568

		TOTAL PREFERRED STOCKS (Cost — $8,250)		8,568


Face
Amount		Rating‡

ASSET-BACKED SECURITIES(c) — 1.1%
Home Equity — 1.1%
$	253,633	A+	Bear Stearns Asset-Backed Securities Inc., Series 2005-AC4, Class M2, 5.993% due 7/25/35	254,520
	157,232	A	Option One Mortgage Loan Trust, Series 2002-4, Class M2, 7.018% due 7/25/32	157,463
	250,000	A-	Renaissance Home Equity Loan Trust, Series 2003-4, Class M3, 7.223% due 3/25/34	252,940
	99,669	Aaa(d)	SACO I Trust, Series 2005-2, Class A, 5.523% due 4/25/35 (e)	99,716

			TOTAL ASSET-BACKED SECURITIES(Cost — $765,605)	764,639

COLLATERALIZED MORTGAGE OBLIGATION — 0.3%
	200,000	AAA	Washington Mutual Inc., Series 2006-AR6, Class 2A1, 5.997% due 8/25/36 (c) (Cost — $199,697)	199,687

CONVERTIBLE BONDS & NOTES — 9.3%
Airlines — 0.4%
	100,000	CCC+	Continental Airlines Inc., Series B, 4.500% due 2/1/07	99,250
	200,000	B-	JetBlue Airways Corp., 3.500% due 7/15/33	179,750

			Total Airlines	279,000

See Notes to Financial Statements.

24 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Face
Amount		Rating‡	Security		Value

Biotechnology — 4.2%
			BioMarin Pharmaceuticals Inc.:
$	150,000	CCC		2.500% due 3/29/13	$	166,125
	450,000	CCC		Subordinated Notes, 3.500% due 6/15/08 (a)		478,125
	400,000	NR	Enzon Pharmaceuticals Inc., Subordinated Notes, 4.500% due 7/1/08			385,500
	150,000	BBB	Genzyme Corp., Senior Notes, 1.250% due 12/1/23			156,562
	500,000	NR	Incyte Corp., 3.500% due 2/15/11			385,625
	400,000	NR	InterMune Inc., 0.250% due 3/1/11			357,500
	30,000	NR	Invitrogen Corp., Senior Notes, 1.500% due 2/15/24			25,275
	250,000	NR	Isis Pharmaceuticals Inc., 5.500% due 5/1/09			233,750
	300,000	NR	NPS Pharmaceuticals Inc., Senior Notes, 3.000% due 6/15/08			255,750
	475,000	NR	Oscient Pharmaceutical Corp., 3.500% due 4/15/11			316,469

			Total Biotechnology			2,760,681

Communications Equipment — 0.9%
	400,000	B	Ciena Corp., Senior Notes, 3.750% due 2/1/08			384,500
	150,000	NR	SafeNet Inc., 2.500% due 12/15/10 (e)			130,875
	100,000	NR	UTStarcom Inc., 0.875% due 3/1/08			85,875

			Total Communications Equipment			601,250

Diversified Telecommunication Services — 0.7%
	150,000	CCC-	Level 3 Communications Inc., Subordinated Notes, 6.000% due 3/15/10			125,063
	350,000	CCC	Logix Communications Enterprises, 1.500% due 10/1/25			350,437

			Total Diversified Telecommunication Services			475,500

Electrical Equipment — 0.3%
	250,000	CCC+	GrafTech International Ltd, Senior Debentures, 1.625% due 1/15/24			180,625

Life Sciences Tools & Services — 0.3%
	200,000	B-	SFBC International Inc., Senior Notes, 2.250% due 8/15/24			170,750

Media — 0.9%
			Charter Communications Inc., Senior Notes, Class A Shares:
	308,000	CCC-		5.875% due 11/16/09		229,845
	92,000	CCC-		5.875% due 11/16/09 (e)		68,655
	220,000	BB+	Liberty Media Corp., Senior Debentures, 4.000% due 11/15/29 (f)			136,400
	150,000	NR	Mediacom Communications Corp., Senior Notes, 5.250% due 7/1/06			150,000

			Total Media			584,900

Real Estate Investment Trusts (REITs) — 0.5%
	250,000	BB	Host Marriott LP, 3.250% due 4/15/24 (e)			332,500

Semiconductors & Semiconductor Equipment — 0.0%
	25,000	CCC	Amkor Technology Inc., 2.500% due 5/15/11			23,156

Software — 0.6%
	130,000	NR	Manugistics Group Inc., Subordinated Notes, 5.000% due 11/1/07			129,838
	250,000	NR	Mentor Graphics Corp., 6.250% due 3/1/26 (e)			273,750

			Total Software			403,588

See Notes to Financial Statements.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 25


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Face
Amount		Rating‡	Security	Value

Specialty Retail — 0.5%
$	400,000	B-	Pier 1 Imports Inc., 6.375% due 2/15/36 (e)	$	366,500

			TOTAL CONVERTIBLE BONDS & NOTES (Cost — $6,199,948)		6,178,450

CORPORATE BONDS & NOTES — 18.1%
Aerospace & Defense — 0.0%
	15,000	B+	Alliant Techsystems Inc., Senior Subordinated Notes, 6.750% due 4/1/16		14,475

Airlines — 0.1%
	30,000	B	Continental Airlines Inc., Pass-Through Certificates, Series 2001-2, Class D, 7.568% due 12/1/06		29,943

Auto Components — 0.1%
	20,000	B-	Keystone Automotive Operations Inc., Senior Subordinated Notes, 9.750% due 11/1/13		19,000
	45,000	B-	Visteon Corp., Senior Notes, 8.250% due 8/1/10		42,300

			Total Auto Components		61,300

Beverages — 0.3%
	100,000	A+	Anheuser-Busch Cos. Inc., 9.000% due 12/1/09		110,299
	100,000	A	PepsiAmericas Inc., Senior Notes, 6.375% due 5/1/09		101,526

			Total Beverages		211,825

Biotechnology — 0.0%
	5,000	B	Angiotech Pharmaceuticals Inc., Senior Subordinated Notes, 7.750% due 4/1/14 (e)		4,800

Building Products — 0.1%
	40,000	CCC	Associated Materials Inc., Senior Subordinated Notes, 9.750% due 4/15/12		40,000
	10,000	B	Jacuzzi Brands Inc., Secured Notes, 9.625% due 7/1/10		10,612
	40,000	CCC+	Nortek Inc., Senior Subordinated Notes, 8.500% due 9/1/14		38,900

			Total Building Products		89,512

Capital Markets — 0.0%
	10,000	B+	E*TRADE Financial Corp., Senior Notes, 7.875% due 12/1/15		10,300

Chemicals — 0.2%
	45,000	A-	Monsanto Co., Notes, 4.000% due 5/15/08		43,653
	75,000	BBB+	Potash Corp. of Saskatchewan, 7.125% due 6/15/07		75,857

			Total Chemicals		119,510

Commercial Services & Supplies — 0.1%
	10,000	B-	NationsRent Inc., Senior Subordinated Notes, 9.500% due 5/1/15		10,625
	45,000	BB-	Windstream Corp., Senior Notes, 8.625% due 8/1/16 (e)		46,238

			Total Commercial Services & Supplies		56,863

Computers & Peripherals — 0.1%
	55,000	B-	SunGard Data Systems Inc., Senior Subordinated Notes, 10.250% due 8/15/15 (e)		57,131

See Notes to Financial Statements.

26 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Face
Amount		Rating‡	Security		Value

Construction Materials — 0.0%
$	30,000	CCC+	NTK Holdings Inc., Senior Discount Notes, step bond to yield 10.002% due 3/1/14		$	21,863

Consumer Finance — 1.0%
	300,000	B+	Ford Motor Credit Co., Senior Notes, 5.800% due 1/12/09			274,225
	400,000	BB	General Motors Acceptance Corp., Notes, 5.625% due 5/15/09			380,709

			Total Consumer Finance			654,934

Containers & Packaging — 0.2%
	40,000	CCC+	Graham Packaging Co. Inc., Senior Subordinated Notes, 9.875% due 10/15/14			39,800
	38,000	CCC+	Jefferson Smurfit Corp., Senior Notes, 8.250% due 10/1/12			35,815
	20,000	BB-	Owens-Brockway Glass Container Inc., Senior Secured Notes, 8.750% due 11/15/12			20,925
	15,000	B	Plastipak Holdings Inc., Senior Notes, 8.500% due 12/15/15 (e)			15,075

			Total Containers & Packaging			111,615

Diversified Consumer Services — 0.1%
	65,000	B	Hertz Corp., Senior Subordinated Notes, 10.500% due 1/1/16 (e)			69,225

Diversified Financial Services — 10.9%
	75,000	BBB+	Capital One Bank, Notes, 5.750% due 9/15/10			74,892
	10,000	CCC+	CCM Merger Inc., Notes, 8.000% due 8/1/13 (e)			9,500
			Citisteel USA Inc., Senior Secured Notes:
	10,000	CCC+		12.480% due 9/1/10 (c)		10,375
	10,000	NR		15.000% due 10/1/10 (e)(g)		10,000
	125,000	A	Countrywide Home Loans Inc., Medium-Term Notes, Series M, 4.125% due 9/15/09			118,962
	15,000	B-	Hughes Network Systems LLC/HNS Finance Corp., Senior Notes, 9.500% due 4/15/14 (e)			14,775
	125,000	A+	Nationwide Building Society, Medium-Term Notes, 2.625% due 1/30/07 (e)			122,916
	90,000	BBB-	Residential Capital Corp., Notes, 6.000% due 2/22/11			87,294
	100,000	A+	Rio Tinto Finance USA Ltd., Notes, 2.625% due 9/30/08			93,737
	6,675,000	B+	Targeted Return Index Securities (TRAINS), Secured Notes, Series HY-1-2006, 7.548% due 5/1/16 (e)			6,552,654
	103,000	AAA	TIAA Global Markets Inc., Notes, 4.125% due 11/15/07 (e)			100,715
	10,000	B-	UGS Corp., 10.000% due 6/1/12			10,800
	25,000	CCC+	Vanguard Health Holdings Co. II LLC, Senior Subordinated Notes, 9.000% due 10/1/14			25,062

			Total Diversified Financial Services			7,231,682

See Notes to Financial Statements.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 27


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Face
Amount		Rating‡	Security		Value

Diversified Telecommunication Services — 0.3%
			Cincinnati Bell Inc.:
$	5,000	B-		7.000% due 2/15/15	$	4,738
	20,000	B-		Senior Subordinated Notes, 8.375% due 1/15/14		19,800
	25,000	BB+	Citizens Communications Co., Senior Notes, 9.000% due 8/15/31			25,437
	20,000	CCC+	Hawaiian Telcom Communications Inc., Senior Subordinated Notes, Series B, 12.500% due 5/1/15			21,050
			Intelsat Bermuda Ltd., Senior Notes:
	30,000	B+		9.250% due 6/15/16 (e)		31,125
	55,000	B		11.250% due 6/15/16 (e)		56,650
	45,000	B	Intelsat Ltd., Notes, 7.625% due 4/15/12			37,350

			Total Diversified Telecommunication Services			196,150

Electric Utilities — 0.0%
	26,699	B+	Midwest Generation LLC, Pass-Through Certificates, Series B, 8.560% due 1/2/16			28,051

Energy Equipment & Services — 0.1%
	75,000	BBB+	Cameron International Corp., Senior Notes, 2.650% due 4/15/07			72,916
	5,000	BB-	Pride International Inc., Senior Notes, 7.375% due 7/15/14			5,050

			Total Energy Equipment & Services			77,966

Food Products — 0.3%
	125,000	A	Campbell Soup Co., Notes, 6.900% due 10/15/06			125,453
	75,000	BBB+	Kellogg Co., Senior Notes, 2.875% due 6/1/08			71,289

			Total Food Products			196,742

Health Care Providers & Services — 0.3%
	45,000	B	DaVita Inc., Senior Subordinated Notes, 7.250% due 3/15/15			43,425
	30,000	BB+	HCA Inc., Notes, 6.375% due 1/15/15			27,946
			Tenet Healthcare Corp., Senior Notes:
	100,000	B		9.875% due 7/1/14		100,500
	5,000	B		6.875% due 11/15/31		4,025

			Total Health Care Providers & Services			175,896

Hotels, Restaurants & Leisure — 0.3%
	20,000	B	Inn of the Mountain Gods Resort & Casino, Senior Notes, 12.000% due 11/15/10			21,350
	125,000	A	McDonald’s Corp., Medium-Term Notes, Series E, 5.950% due 1/15/08			125,555
	34,882	B+	MGM MIRAGE Inc., Senior Subordinated Notes, 9.375% due 2/15/10			36,888
	5,000	B+	River Rock Entertainment Authority, Senior Notes, 9.750% due 11/1/11			5,287

			Total Hotels, Restaurants & Leisure			189,080

See Notes to Financial Statements.

28 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Face
Amount		Rating‡	Security			Value

Household Durables — 0.3%
			Beazer Homes USA Inc., Senior Notes:
$	5,000	BB		6.875% due 7/15/15		$	4,575
	10,000	BB		8.125% due 6/15/16 (e)			9,663
	100,000	BBB	Centex Corp., Notes, 4.750% due 1/15/08				98,102
			K Hovnanian Enterprises Inc.:
	10,000	BB		6.250% due 1/15/16			8,725
	50,000	BB		Senior Notes, 8.625% due 1/15/17			49,875
	15,000	B-	Norcraft Cos. LP/Norcraft Finance Corp., Senior Subordinated Notes,
				9.000% due 11/1/11			15,337
	5,000	B-	Norcraft Holdings LP/Norcraft Capital Corp., Senior Discount Notes, step bond to yield 7.856% due 9/1/12				4,075

			Total Household Durables				190,352

Household Products — 0.1%
	77,000	CCC	Spectrum Brands Inc., Senior Subordinated Notes, 7.375% due 2/1/15				62,948

Independent Power Producers & Energy Traders — 0.2%
	20,000	B1(d)	Edison Mission Energy, Senior Notes, 7.750% due 6/15/16 (e)				19,750
	90,000	B-	NRG Energy Inc., Senior Notes, 7.375% due 2/1/16				87,975

			Total Independent Power Producers & Energy Traders				107,725

Insurance — 0.5%
	15,000	BB	Crum & Forster Holdings Corp., Senior Notes, 10.375% due 6/15/13				15,337
	125,000	A	Genworth Financial Inc., Notes, 4.750% due 6/15/09				122,136
	135,000	AA	Protective Life Secured Trust, Medium-Term Notes, 3.700% due 11/24/08				129,183
	75,000	BBB+	Unitrin Inc., Senior Notes, 5.750% due 7/1/07				74,693

			Total Insurance				341,349

Internet & Catalog Retail — 0.0%
	15,000	B-	FTD Inc., Senior Subordinated Notes, 7.750% due 2/15/14				14,850

Machinery — 0.2%
	100,000	A	Caterpillar Inc., Senior Debentures, 7.250% due 9/15/09				104,923
	36,000	B+	Terex Corp., Senior Subordinated Notes, 7.375% due 1/15/14				36,000

			Total Machinery				140,923

Media — 0.5%
	25,000	B-	Affinion Group Inc., Senior Notes, 10.125% due 10/15/13 (e)				25,250
			AMC Entertainment Inc.:
	10,000	B-		Senior Note, Series B, 8.625% due 8/15/12			10,325
	40,000	CCC+		Senior Subordinated Notes, 11.000% due 2/1/16			43,000
			Charter Communications Holdings II LLC/Charter Communications Holdings II Capital Corp., Senior Notes:
	30,000	CCC-			9.625% due 11/15/09		23,250
	20,000	CCC-			10.250% due 9/15/10		20,150
	10,000	B+	CSC Holdings Inc., Senior Debentures, 7.625% due 7/15/18				9,950
	15,000	B-	Kabel Deutschland GMBH, Senior Notes, 10.625% due 7/1/14 (e)				15,825
	20,000	B	Lamar Media Corp., Senior Subordinated Notes, 6.625% due 8/15/15				18,600
	20,000	B	Primedia Inc., Senior Notes, 8.875% due 5/15/11				19,300

See Notes to Financial Statements.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 29


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Face
Amount		Rating‡	Security	Value

Media — 0.5% (continued)
$	10,000	B+	Rainbow National Services LLC, Senior Notes, 8.750% due 9/1/12 (e)	$	10,550
	25,000	BB+	Rogers Cable Inc., Secured Notes, 5.500% due 3/15/14		22,312
	40,000	B	Sinclair Broadcast Group Inc., Senior Subordinated Notes, 8.000% due 3/15/12		40,800
	50,000	CCC	XM Satellite Radio Inc., Senior Notes, 9.750% due 5/1/14 (e)		46,000

			Total Media		305,312

Metals & Mining — 0.1%
	30,000	B-	Metals USA Inc., Senior Secured Notes, 11.125% due 12/1/15 (e)		33,000
	20,000	B-	RathGibson Inc., Senior Notes, 11.250% due 2/15/14 (e)		20,700

			Total Metals & Mining		53,700

Multiline Retail — 0.1%
	35,000	B-	Neiman Marcus Group Inc., Senior Subordinated Notes, 10.375% due 10/15/15 (e)		37,363

Oil, Gas & Consumable Fuels — 0.7%
	25,000	CCC+	Belden & Blake Corp., Secured Notes, 8.750% due 7/15/12		25,500
	100,000	A-	Burlington Resources Finance Corp., Senior Notes, 5.600% due 12/1/06		99,961
	50,000	BB	Chesapeake Energy Corp., Senior Notes, 6.500% due 8/15/17		45,875
	5,000	BB-	Compagnie Generale de Geophysique SA, Senior Notes, 7.500% due 5/15/15 (e)		4,913
	20,000	CCC+	International Coal Group Inc., Senior Notes, 10.250% due 7/15/14 (e)		20,075
	105,000	BB-	Northwest Pipelines Corp., Senior Notes, 7.000% due 6/15/16 (e)		104,869
	20,000	B-	Petrohawk Energy Corp., Senior Notes, 9.125% due 7/15/13 (e)		20,000
	20,000	B+	Pogo Producing Co., Senior Subordinated Notes, 7.875% due 5/1/13 (e)		20,150
	100,000	A-	Vintage Petroleum Inc., Senior Notes, 8.250% due 5/1/12		105,819
	40,000	BBB+	XTO Energy Inc., 7.500% due 4/15/12		42,572

			Total Oil, Gas & Consumable Fuels		489,734

Paper & Forest Products — 0.1%
	40,000	B	Appleton Papers Inc., Senior Subordinated Notes, Series B, 9.750% due 6/15/14		40,600
	15,000	CCC+	NewPage Corp., Senior Subordinated Notes, 12.000% due 5/1/13		15,600

			Total Paper & Forest Products		56,200

Personal Products — 0.0%
	10,000	B	Playtex Products Inc., Senior Secured Notes, 8.000% due 3/1/11		10,400

Pharmaceuticals — 0.0%
	30,000	CCC	Leiner Health Products Inc., Senior Subordinated Notes, 11.000% due 6/1/12		28,538

Real Estate Investment Trusts (REITs) — 0.1%
	15,000	BB	Host Marriott LP, Senior Notes, 6.750% due 6/1/16 (e)		14,381
	75,000	BBB	iStar Financial Inc., Senior Notes, Series B, 4.875% due 1/15/09		73,076
	5,000	BB+	Ventas Realty LP/Ventas Capital Corp., Senior Notes, 6.500% due 6/1/16		4,819

			Total Real Estate Investment Trusts (REITs)		92,276

See Notes to Financial Statements.

30 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Face
Amount		Rating‡	Security	Value

Real Estate Management & Development — 0.0%
$	15,000	B	Kimball Hill Inc., Senior Subordinated Notes, 10.500% due 12/15/12	$	13,950

Road & Rail — 0.2%
	75,000	BBB+	Burlington Northern Santa Fe Corp., Notes, 7.875% due 4/15/07		76,195
	30,000	B-	Grupo Transportacion Ferroviaria Mexicana SA de CV, Senior Notes, 9.375% due 5/1/12		32,100

			Total Road & Rail		108,295

Semiconductors & Semiconductor Equipment — 0.0%
	35,000	B-	MagnaChip Semiconductor, Senior Subordinated Notes, 8.000% due 12/15/14		29,225

Software — 0.1%
	30,000	B-	UGS Capital Corp. II, Senior Notes, 10.380% due 6/1/11 (c)(e)(g)		29,850

Specialty Retail — 0.1%
	15,000	CCC	Blockbuster Inc., Senior Subordinated Notes, 9.000% due 9/1/12		14,063
	20,000	B-	Suburban Propane Partners LP/Suburban Energy Finance Corp., Senior Notes, 6.875% due 12/15/13		18,800

			Total Specialty Retail		32,863

Thrifts & Mortgage Finance — 0.1%
	100,000	BBB+	GreenPoint Financial Corp., Senior Notes, 3.200% due 6/6/08		95,306

Trading Companies & Distributors — 0.0%
	20,000	B-	Transdigm Inc., Senior Subordinated Notes, 7.750% due 7/15/14 (e)		20,000

Wireless Telecommunication Services — 0.2%
	25,000	CCC	Rural Cellular Corp., Senior Notes, 9.875% due 2/1/10		25,844
	75,000	A-	Sprint Capital Corp., Notes, 6.000% due 1/15/07		75,110

			Total Wireless Telecommunication Services		100,954

			TOTAL CORPORATE BONDS & NOTES (Cost — $12,104,647)		11,970,976


Face
Amount

MORTGAGE-BACKED SECURITIES — 6.1%
FHLMC — 2.0%
		Federal Home Loan Mortgage Corp. (FHLMC):
	331,027		5.126% due 6/1/35 (c)	325,014
	967,228		Gold, 6.000% due 2/1/26-2/1/36	956,563

		TOTAL FHLMC		1,281,577

See Notes to Financial Statements.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 31


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Face
Amount		Security		Value

FNMA — 4.1%
		Federal National Mortgage Association (FNMA):
$	324,007		5.641% due 4/1/36 (c)	$	325,141
	1,500,000		5.000% due 7/13/36 (h)		1,402,500
	1,000,000		6.500% due 7/13/36 (h)		1,005,312

		Total FNMA			2,732,953

		TOTAL MORTGAGE-BACKED SECURITIES (Cost — $4,043,239)			4,014,530

U.S. GOVERNMENT & AGENCY OBLIGATION — 0.4%
U.S. Government Obligations — 0.4%
	275,000	U.S. Treasury Notes, 4.875% due 4/30/08 (Cost — $274,671)			273,593


Contracts

PURCHASED OPTION — 0.4%
	90	S&P 500 Index, Put @ 1,275, expires 9/06 (Cost — $236,831)	238,500

		TOTAL INVESTMENTS BEFORE SHORT-TERM INVESTMENTS (Cost — $51,406,835)	52,651,637

See Notes to Financial Statements.

32 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report


	Schedules of Investments (June 30, 2006) (unaudited) (continued)


Face
Amount		Security	Value

SHORT-TERM INVESTMENTS — 23.6%
Repurchase Agreements — 23.6%
$	10,471,000	Interest in $457,185,000 joint tri-party repurchase agreement dated 6/30/06 with Merrill Lynch, Pierce, Fenner & Smith Inc., 5.200% due 7/3/06; Proceeds at maturity — $10,475,537; (Fully collateralized by U.S. Treasury Note, 4.125% due 8/15/08; Market value — $10,680,433)	$	10,471,000
	5,114,000	Merrill Lynch, Pierce, Fenner & Smith Inc. repurchase agreement dated 6/30/06, 5.150% due 7/3/06; Proceeds at maturity — $5,116,195; (Fully collateralized by U.S. Treasury Note, 4.125% due 8/15/08; Market value — $5,217,691)		5,114,000

		TOTAL SHORT-TERM INVESTMENTS (Cost — $15,585,000)		15,585,000

		TOTAL INVESTMENTS — 103.1% (Cost — $66,991,835#)		68,236,637
		Liabilities in Excess of Other Assets — (3.1)%		(2,046,564	)

		TOTAL NET ASSETS — 100.0%	$	66,190,073


*		Non-income producing security.

^‡		All ratings are by Standard & Poor’s Ratings Service, unless otherwise noted.

^(a)		All or a portion of this security is segregated for open futures contracts and purchased options.

^(b)		All or a portion of this security is held at the broker as collateral for open futures contracts.

^(c)		Variable rate security. Interest rate disclosed is that which is in effect at June 30, 2006.

^(d)		Rating by Moody’s Investors Service.

^(e)		Security is exempt from registration under Rule 144A of the Securities Act of 1933. This security may be resold in transactions that are exempt from registration, normally to qualified institutional buyers. This security has been deemed liquid pursuant to guidelines approved by the Board of Trustees, unless otherwise noted.

^(f)		Convertible bonds are exchangeable for common stock of Sprint Nextel Corp.

^(g)		Payment-in-kind security for which part of the income earned may be paid as additional principal.

^(h)		This security is traded on a to-be-announced (“TBA”) basis (See Note 1).

^#		Aggregate cost for federal income tax purposes is substantially the same.

		See page 34 for definitions of ratings.

		Abbreviations used in this schedule:


ADR		— American Depositary Receipt
FDR		— Foreign Depositary Receipt

See Notes to Financial Statements.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 33

Bond Ratings (unaudited)

The definitions of the applicable rating symbols are set forth below:

Standard & Poor’s Ratings Service (“Standard & Poor’s”) — Ratings from “AA” to “CCC” may be modified by the addition of a plus (+) or minus (-) sign to show relative standings within the major rating categories.


AAA	—	Bonds rated “AAA” have the highest rating assigned by Standard & Poor’s. Capacity to pay interest and repay principal is extremely strong.
AA	—	Bonds rated “AA” have a very strong capacity to pay interest and repay principal and differ from the highest rated issues only in a small degree.
A	—	Bonds rated “A” have a strong capacity to pay interest and repay principal although they are somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than debt in higher rated categories.
BBB	—	Bonds rated “BBB” are regarded as having an adequate capacity to pay interest and repay principal. Whereas they normally exhibit adequate protection parameters, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity to pay interest and repay principal for bonds in this category than in higher rated categories.
BB, B, CCC, CC and C	—	Bonds rated “BB”, “B”, “CCC”, “CC” and “C” are regarded, on balance, as predominantly speculative with respect to capacity to pay interest and repay principal in accordance with the terms of the obligation. “BB” represents the lowest degree of speculation and “C” the highest degree of speculation. While such bonds will likely have some quality and protective characteristics, these are outweighed by large uncertainties or major risk exposures to adverse conditions.
D	—	Bonds rated “D” are in default and payment of interest and/or repayment of principal is in arrears.

Moody’s Investors Service (“Moody’s”) — Numerical modifiers 1, 2, and 3 may be applied to each generic rating from “Aa” to “Caa”, where 1 is the highest and 3 the lowest rating within its generic category.
Aaa	—	Bonds rated “Aaa” are judged to be of the best quality. They carry the smallest degree of investment risk and are generally referred to as “gilt edge.” Interest payments are protected by a large or by an exceptionally stable margin and principal is secure. While the various protective elements are likely to change, such changes as can be visualized are most unlikely to impair the fundamentally strong position of such issues.
Aa	—	Bonds rated “Aa” are judged to be of high quality by all standards. Together with the “Aaa” group they comprise what are generally known as high grade bonds. They are rated lower than the best bonds because margins of protection may not be as large as in “Aaa” securities or fluctuation of protective elements may be of greater amplitude or there may be other elements present which make the long-term risks appear somewhat larger than in “Aaa” securities.
A	—	Bonds rated “A” possess many favorable investment attributes and are to be considered as upper medium grade obligations. Factors giving security to principal and interest are considered adequate but elements may be present which suggest a susceptibility to impairment some time in the future.
Baa	—	Bonds rated “Baa” are considered as medium grade obligations, i.e., they are neither highly protected nor poorly secured. Interest payments and principal security appear adequate for the present but certain protective elements may be lacking or may be characteristically unreliable over any great length of time. Such bonds lack outstanding investment characteristics and in fact have speculative characteristics as well.
Ba	—	Bonds rated “Ba” are judged to have speculative elements; their future cannot be considered as well assured. Often the protection of interest and principal payments may be very moderate and therefore not well safeguarded during both good and bad times over the future. Uncertainty of position characterizes bonds in this class.
B	—	Bonds rated “B” generally lack characteristics of desirable investments. Assurance of interest and principal payments or of maintenance of other terms of the contract over any long period of time may be small.
Caa	—	Bonds rated “Caa” are of poor standing. These may be in default, or present elements of danger may exist with respect to principal or interest.
Ca	—	Bonds rated “Ca” represent obligations which are speculative in a high degree. Such issues are often in default or have other marked short-comings.
C	—	Bonds rated “C” are the lowest class of bonds and issues so rated can be regarded as having extremely poor prospects of ever attaining any real investment standing.
NR	—	Indicates that the bond is not rated by Standard & Poor’s or Moody’s.

34 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report


	Statements of Assets and Liabilities (June 30, 2006) (unaudited)


		Legg Mason		Legg Mason		Legg Mason
		Partners Variable		Partners Variable		Partners Variable
		Appreciation		Fundamental		Capital and Income
		Portfolio		Value Portfolio		Portfolio

ASSETS:
	Investments, at cost	$	666,261,089	$	665,974,802	$	51,406,835
	Repurchase agreements, at cost		26,721,000		77,561,000		15,585,000
	Foreign currency, at cost		—		182,802		7,828

	Investments, at value	$	836,111,294	$	819,311,629	$	52,651,637
	Repurchase agreements, at value		26,721,000		77,561,000		15,585,000
	Foreign currency, at value		—		183,846		8,003
	Cash		70		410		1,744
	Dividends and interest receivable		693,859		1,464,443		356,310
	Receivable for Fund shares sold		220,908		246,068		349,478
	Receivable for securities sold		—		—		202,663
	Principal paydown receivable		—		—		3,498

	Total Assets		863,747,131		898,767,396		69,158,333

LIABILITIES:
	Payable for securities purchased		1,297,886		—		2,881,674
	Payable for Fund shares repurchased		1,118,519		1,051,630		1,760
	Investment management fee payable		485,895		547,816		38,253
	Trustees’ fees payable		4,371		1,958		124
	Deferred compensation payable		3,946		3,495		61
	Payable to broker — variation margin on open futures contracts		—		—		20,051
	Accrued expenses		77,520		64,289		26,337

	Total Liabilities		2,988,137		1,669,188		2,968,260

Total Net Assets		$	860,758,994	$	897,098,208	$	66,190,073

NET ASSETS:
	Par value (Note 4)	$	34,337	$	41,883	$	6,086
	Paid-in capital in excess of par value		668,468,154		720,274,838		64,144,027
	Undistributed net investment income		5,359,984		6,441,777		778,172
	Accumulated net realized gain (loss) on investments, futures contracts and foreign currency transactions		17,046,339		17,001,839		(117,119	)
	Net unrealized appreciation on investments, futures contracts and foreign currencies		169,850,180		153,337,871		1,378,907

Total Net Assets		$	860,758,994	$	897,098,208	$	66,190,073

Shares Outstanding			34,337,075		41,882,870		6,085,802

Net Asset Value			$25.07		$21.42		$10.88

See Notes to Financial Statements.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 35

��


	Statements of Operations (For the six months ended June 30, 2006) (unaudited)


			Legg Mason			Legg Mason			Legg Mason
			Partners Variable			Partners Variable			Partners Variable
			Appreciation			Fundamental			Capital and
			Portfolio			Value Portfolio			Income Portfolio

INVESTMENT INCOME:
	Dividends		$	7,366,692		$	7,740,421		$	210,986
	Interest			1,129,730			2,344,969			782,203
	Less: Foreign taxes withheld			(13,545	)		(186,984	)		(4,196	)

	Total Investment Income			8,482,877			9,898,406			988,993

EXPENSES:
	Investment management fee (Note 2)			3,075,423			3,409,543			186,123
	Shareholder reports			23,443			14,673			3,646
	Trustees’ fees			10,174			8,506			339
	Audit and tax			9,813			11,960			11,230
	Insurance			9,459			9,451			—
	Custody fees			5,206			7,192			6,302
	Legal fees			4,650			8,083			4,985
	Transfer agent fees			359			59			268
	Registration fees			—			—			940
	Miscellaneous expenses			1,860			2,079			1,443

	Total Expenses			3,140,387			3,471,546			215,276
	Less: Fee waivers and/or expense reimbursements (Note 2)			(21,442	)		(21,395	)		(2,226	)

	Net Expenses			3,118,945			3,450,151			213,050

Net Investment Income				5,363,932			6,448,255			775,943

REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS, FUTURES CONTRACTS AND FOREIGN CURRENCY TRANSACTIONS (NOTES 1 AND 3):
	Net Realized Gain (Loss) From:
		Investment transactions		29,278,123			18,203,012			(100,884	)
		Futures contracts		602,052			—			—
		Foreign currency transactions		(262	)		(16,503	)		184

	Net Realized Gain (Loss)			29,879,913			18,186,509			(100,700	)

	Change in Net Unrealized Appreciation/ Depreciation From:
		Investments		(3,002,638	)		13,342,705			(138,200	)
		Futures contracts		—			—			192,700
		Foreign currencies		72			1,044			190

	Change in Net Unrealized Appreciation/Depreciation			(3,002,566	)		13,343,749			54,690

Net Gain (Loss) on Investments, Futures Contracts and Foreign Currency Transactions				26,877,347			31,530,258			(46,010	)

Increase in Net Assets From Operations			$	32,241,279		$	37,978,513		$	729,933

See Notes to Financial Statements.

36 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report


	Statements of Changes in Net Assets

	For the six months ended June 30, 2006 (unaudited)
	and the year ended December 31, 2005


Legg Mason Partners Variable Appreciation Portfolio		2006		2005

OPERATIONS:
	Net investment income	$	5,363,932	$	7,561,463
	Net realized gain		29,879,913		38,711,871
	Change in net unrealized appreciation/depreciation		(3,002,566)		(9,280,692)

	Increase in Net Assets From Operations		32,241,279		36,992,642

DISTRIBUTIONS TO SHAREHOLDERS FROM (NOTE 1):
	Net investment income		(62,735)		(7,595,224)
	Net realized gains		(742,124)		—

	Decrease in Net Assets From Distributions to Shareholders		(804,859)		(7,595,224)

FUND SHARE TRANSACTIONS (NOTE 4):
	Net proceeds from sale of shares		18,917,398		77,910,897
	Reinvestment of distributions		804,859		7,595,224
	Cost of shares repurchased		(89,256,774)		(67,550,432)

	Increase (Decrease) in Net Assets From Fund Share Transactions		(69,534,517)		17,955,689

Increase (Decrease) in Net Assets			(38,098,097)		47,353,107
NET ASSETS:
	Beginning of period		898,857,091		851,503,984

	End of period*	$	860,758,994	$	898,857,091

* Includes undistributed net investment income of:			$5,359,984	$	58,787

See Notes to Financial Statements.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 37


	Statements of Changes in Net Assets (continued)

	For the six months ended June 30, 2006 (unaudited)
	and the year ended December 31, 2005


Legg Mason Partners Variable Fundamental Value Portfolio		2006		2005

OPERATIONS:
	Net investment income	$	6,448,255	$	8,523,386
	Net realized gain		18,186,509		59,418,579
	Change in net unrealized appreciation/depreciation		13,343,749		(26,608,718)

	Increase in Net Assets From Operations		37,978,513		41,333,247

DISTRIBUTIONS TO SHAREHOLDERS FROM (NOTE 1):
	Net investment income		(335,054)		(8,299,854)
	Net realized gains		(2,981,424)		(52,154,309)

	Decrease in Net Assets From Distributions to Shareholders		(3,316,478)		(60,454,163)

FUND SHARE TRANSACTIONS (NOTE 4):
	Net proceeds from sale of shares		18,577,409		26,682,851
	Reinvestment of distributions		3,316,478		60,454,163
	Cost of shares repurchased		(55,925,660)		(61,653,711)
	Net assets of shares issued in connection with merger (Note 5)		—		4,395,485

	Increase (Decrease) in Net Assets From Fund Share Transactions		(34,031,773)		29,878,788

Increase in Net Assets			630,262		10,757,872
NET ASSETS:
	Beginning of period		896,467,946		885,710,074

	End of period*	$	897,098,208	$	896,467,946

* Includes undistributed net investment income of:			$6,441,777	$	328,576

See Notes to Financial Statements.

38 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report


	Statements of Changes in Net Assets (continued)

	For the six months ended June 30, 2006 (unaudited) and the year ended December 31, 2005


Legg Mason Partners Variable Capital and Income Portfolio		2006		2005^†

OPERATIONS:
	Net investment income	$	775,943	$	406,947
	Net realized gain (loss)		(100,700)		348,150
	Change in net unrealized appreciation/depreciation		54,690		1,324,217

	Increase in Net Assets From Operations		729,933		2,079,314

	DISTRIBUTIONS TO SHAREHOLDERS FROM (NOTE 1):
	Net investment income		—		(406,230)
	Net realized gains		—		(366,963)

	Decrease in Net Assets From Distributions to Shareholders		—		(773,193)

FUND SHARE TRANSACTIONS (NOTE 4):
	Net proceeds from sale of shares		29,884,071		52,612,924
	Reinvestment of distributions		—		773,193
	Cost of shares repurchased		(401,833)		(18,714,336)

	Increase in Net Assets From Fund Share Transactions		29,482,238		34,671,781

Increase in Net Assets			30,212,171		35,977,902
NET ASSETS:
	Beginning of period		35,977,902		—

	End of period**	$	66,190,073	$	35,977,902

* Includes undistributed net investment income of:			$778,172	$	2,229

† The Fund commenced operations on May 3, 2005.

See Notes to Financial Statements.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 39


	Financial Highlights

For a share of beneficial interest outstanding throughout each year ended December 31, unless otherwise noted:


Legg Mason Partners Variable
Appreciation Portfolio		2006(1)			2005			2004			2003			2002(2)			2001(2)

Net Asset Value, Beginning of Period			$24.23			$23.43			$21.77			$17.58			$21.66			$22.81

Income (Loss) From Operations:
	Net investment income		0.16			0.21			0.25			0.14			0.13			0.18
	Net realized and unrealized gain (loss)		0.70			0.80			1.66			4.18			(3.92	)		(1.09	)

Total Income (Loss) From Operations			0.86			1.01			1.91			4.32			(3.79	)		(0.91	)

Less Distributions From:
	Net investment income		(0.00	) ⁽³⁾		(0.21	)		(0.25	)		(0.13	)		(0.29	)		(0.24	)
	Net realized gains		(0.02	)		—			—			—			—			—

Total Distributions			(0.02	)		(0.21	)		(0.25	)		(0.13	)		(0.29	)		(0.24	)

Net Asset Value, End of Period			$25.07			$24.23			$23.43			$21.77			$17.58			$21.66

Total Return⁽⁴⁾			3.57	%		4.29	%		8.79	%		24.56	%		(17.53	)%		(3.97	)%

Net Assets, End of Period (millions)			$861			$899			$852			$730			$549			$638

Ratios to Average Net Assets:
	Gross expenses		0.71	%⁽⁵⁾		0.72	%		0.75	%		0.77	%		0.77	%		0.77	%
	Net expenses		0.70	⁽⁵⁾⁽⁶⁾		0.72			0.75	⁽⁶⁾		0.77			0.77			0.77
	Net investment income		1.21	⁽⁵⁾		0.86			1.14			0.73			0.67			0.83

Portfolio Turnover Rate			22	%		51	%		41	%		41	%		71	%		59	%


⁽¹⁾		For the six months ended June 30, 2006 (unaudited).

⁽²⁾		Per share amounts have been calculated using the average shares method.

⁽³⁾		Amount represents less than $0.01 per share

⁽⁴⁾		Performance figures may reflect fee waivers and/or expense reimbursements. Past performance is no guarantee of future results. In the absence of fee waivers and/or expense reimbursements, the total return would be lower. Total returns do not reflect expenses associated with the separate account such as administrative fees, account charges and surrender charges which, if reflected, would reduce the total return for all periods shown. Total returns for periods of less than one year are not annualized.

⁽⁵⁾		Annualized.

⁽⁶⁾		Reflects fee waivers and/or expense reimbursements.

See Notes to Financial Statements.

40 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report


	Financial Highlights (continued)

For a share of beneficial interest outstanding throughout each year ended December 31, unless otherwise noted:


Legg Mason Partners Variable
Fundamental Value Portfolio		2006(1)			2005			2004			2003			2002(2)			2001

Net Asset Value, Beginning of Period			$20.63			$21.10			$20.08			$14.56			$19.08			$22.55

Income (Loss) From Operations:
	Net investment income		0.15			0.21			0.13			0.11			0.11			0.08
	Net realized and unrealized gain (loss)		0.72			0.80			1.52			5.51			(4.16	)		(1.22	)

Total Income (Loss) From Operations			0.87			1.01			1.65			5.62			(4.05	)		(1.14	)

Less Distributions From:
	Net investment income		(0.01	)		(0.20	)		(0.14	)		(0.10	)		(0.18	)		(0.15	)
	Net realized gains		(0.07	)		(1.28	)		(0.49	)		—			(0.29	)		(2.18	)

Total Distributions			(0.08	)		(1.48	)		(0.63	)		(0.10	)		(0.47	)		(2.33	)

Net Asset Value, End of Period			$21.42			$20.63			$21.10			$20.08			$14.56			$19.08

Total Return⁽³⁾			4.22	%		4.78	%		8.22	%		38.64	%		(21.30	)%		(5.27	)%

Net Assets, End of Period (millions)			$897			$896			$886			$734			$473			$473

Ratios to Average Net Assets:
	Gross expenses		0.76	%⁽⁴⁾		0.78	%		0.77	%		0.77	%		0.78	%		0.77	%
	Net expenses		0.76	⁽⁴⁾⁽⁵⁾		0.78			0.77	⁽⁵⁾		0.77			0.78			0.77
	Net investment income		1.42	⁽⁴⁾		0.97			0.68			0.71			0.68			0.64

Portfolio Turnover Rate			15	%		34	%		31	%		18	%		20	%		32	%


⁽¹⁾		For the six months ended June 30, 2006 (unaudited).

⁽²⁾		Per share amounts have been calculated using the average shares method.

⁽³⁾		Performance figures may reflect fee waivers and/or expense reimbursements. Past performance is no guarantee of future results. In the absence of fee waivers and/or expense reimbursements, the total return would be lower. Total returns do not reflect expenses associated with the separate account such as administrative fees, account charges and surrender charges which, if reflected, would reduce the total return for all periods shown. Total returns for periods of less than one year are not annualized.

⁽⁴⁾		Annualized.

⁽⁵⁾		Reflects fee waivers and/or expense reimbursements.

See Notes to Financial Statements.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 41


	Financial Highlights (continued)

For a share of beneficial interest outstanding throughout each year ended December 31, unless otherwise noted:


Legg Mason Partners Variable Capital and Income Portfolio		2006⁽¹⁾			2005⁽²⁾

Net Asset Value, Beginning of Period		$	10.63		$	10.00

Income From Operations:
	Net investment income		0.13			0.13
	Net realized and unrealized gain		0.12			0.74

Total Income From Operations			0.25			0.87

Less Distributions From:
	Net investment income		—			(0.13	)
	Net realized gains		—			(0.11	)

Total Distributions			—			(0.24	)

Net Asset Value, End of Period		$	10.88		$	10.63

Total Return⁽³⁾			2.35	%		8.66	%

Net Assets, End of Period (000s)		$	66,190		$	35,978

Ratios to Average Net Assets:
	Gross expenses⁽⁴⁾		0.87	%		1.14	%
	Net expenses^(4)(5)(6)		0.86			1.00
	Net investment income⁽⁴⁾		3.13			2.35

Portfolio Turnover Rate			69	%		187	%


⁽¹⁾		For the six months ended June 30, 2006 (unaudited).

⁽²⁾		For the period May 3, 2005 (inception date) to December 31, 2005.

⁽³⁾		Performance figures may reflect fee waivers and/or expense reimbursements. Past performance is no guarantee of future results. In the absence of fee waivers and/or expense reimbursements, the total return would be lower. Total returns do not reflect expenses associated with the separate account such as administrative fees, account charges and surrender charges which, if reflected, would reduce the total return for all periods shown. Total returns for periods of less than one year are not annualized.

⁽⁴⁾		Annualized.

⁽⁵⁾		Reflects fee waivers and/or expense reimbursements.

⁽⁶⁾		The manager has agreed through May 1, 2006 to waive a portion of its fees and/or reimburse expenses so that the Fund’s total operating expenses will not exceed 1.00% of the net assets.

See Notes to Financial Statements.

42 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report

Notes to Financial Statements (unaudited)


1.	Organization and Significant Accounting Policies

Legg Mason Partners Variable Appreciation Portfolio (“Appreciation Portfolio”), Legg Mason Partners Variable Fundamental Value Portfolio (“Fundamental Value Portfolio”) and Legg Mason Partners Variable Capital and Income Portfolio (“Capital and Income Portfolio”) (formerly known as Appreciation Portfolio, Fundamental Value Portfolio and Capital and Income Portfolio, respectively) (the “Funds”) are separate diversified investment funds of Legg Mason Partners Variable Portfolios II (formerly known as Greenwich Street Series Fund) (the “Trust”). The Trust, a Massachusetts business trust, is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. Shares of the Trust can be acquired through investing in an individual flexible premium deferred combination fixed and variable annuity contract or a certificate evidencing interest in a master group flexible premium deferred annuity offered by certain insurance companies. The Funds and the other investment funds of the Trust are offered exclusively for use with certain variable annuity and variable life insurance contracts offered through the separate accounts of various affiliated life insurance companies.

The following are significant accounting policies consistently followed by the Funds and are in conformity with U.S. generally accepted accounting principles (“GAAP”). Estimates and assumptions are required to be made regarding assets, liabilities and changes in net assets resulting from operations when financial statements are prepared. Changes in the economic environment, financial markets and any other parameters used in determining these estimates could cause actual results to differ.

(a) Investment Valuation. Equity securities for which market quotations are available are valued at the last sale price or official closing price on the primary market or exchange on which they trade. Debt securities are valued at the mean between the bid and asked prices provided by an independent pricing service that are based on transactions in debt obligations, quotations from bond dealers, market transactions in comparable securities and various other relationships between securities. When prices are not readily available, or are determined not to reflect fair value, such as when the value of a security has been significantly affected by events after the close of the exchange or market on which the security is principally traded, but before the Funds calculate their net asset value, the Funds may value these investments at fair value as determined in accordance with the procedures approved by the Funds’ Board of Trustees. Short-term obligations with maturities of 60 days or less are valued at amortized cost, which approximates market value.

(b) Repurchase Agreements. When entering into repurchase agreements, it is the Funds’ policy that their custodian or a third party custodian take possession of the underlying collateral securities, the market value of which at least equals the principal amount of the repurchase transaction, including accrued interest. To the extent that any repurchase transaction exceeds one business day, the value of the collateral is marked-to-market to ensure the adequacy of the collateral. If the seller defaults and the market value of the collateral declines or if bankruptcy proceedings are commenced with respect to the seller of the security, realization of the collateral by the Funds may be delayed or limited.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 43

Notes to Financial Statements (unaudited) (continued)

(c) Financial Futures Contracts. Certain Funds may enter into financial futures contracts typically to hedge a portion of the portfolio. Upon entering into a financial futures contract, the Funds are required to deposit cash or securities as initial margin. Additional securities are also segregated up to the current market value of the financial futures contracts. Subsequent payments, known as variation margin, are made or received by the Funds each day, depending on the daily fluctuation in the value of the underlying financial instruments. The Funds recognize an unrealized gain or loss equal to the daily variation margin. When the financial futures contracts are closed, a realized gain or loss is recognized equal to the difference between the proceeds from (or cost of) the closing transactions and the Funds’ basis in the contracts.

The risks associated with entering into financial futures contracts include the possibility that a change in the value of the contract may not correlate with the changes in the value of the underlying instruments. In addition, investing in financial futures contracts involves the risk that the Funds could lose more than the original margin deposit and subsequent payments required for a futures transaction. Risks may also arise upon entering into these contracts from the potential inability of the counterparties to meet the terms of their contracts.

(d) Foreign Currency Translation. Investment securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts based upon prevailing exchange rates on the date of valuation. Purchases and sales of investment securities and income and expense items denominated in foreign currencies are translated into U.S. dollar amounts based upon prevailing exchange rates on the respective dates of such transactions.

The Funds do not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss on investments.

Net realized foreign exchange gains or losses arise from sales of foreign currencies, including gains and losses on forward foreign currency contracts, currency gains or losses realized between the trade and settlement dates on securities transactions and the difference between the amounts of dividends, interest and foreign withholding taxes recorded on the Funds’ books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities, at the date of valuation, resulting from changes in exchange rates.

Foreign security and currency transactions may involve certain considerations and risks not typically associated with those of U.S. dollar denominated transactions as a result of, among other factors, the possibility of lower levels of governmental supervision and regulation of foreign securities markets and the possibility of political or economic instability.

(e) Securities Traded on a To-Be-Announced Basis Certain Funds may trade securities on a to-be-announced (“TBA”) basis. In a TBA transaction, the Funds commit to purchasing or selling securities which have not yet been issued by the issuer and for which specific information is not known, such as the face amount and maturity date and the

44 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report

Notes to Financial Statements (unaudited) (continued)

underlying pool of investments in U.S. government agency mortgage pass-through transactions. Securities purchased on a TBA basis are not settled until they are delivered to the Funds, normally 15 to 45 days later. Beginning on the date the Funds enter into a TBA transaction, cash, U.S. government securities or other liquid high-grade debt obligations are segregated in an amount equal in value to the purchase price of the TBA security. These transactions are subject to market fluctuations and their current value is determined in the same manner as for other securities.

(f) Security Transactions and Investment Income. Security transactions are accounted for on a trade date basis. Interest income, adjusted for amortization of premium and accretion of discount, is recorded on the accrual basis. Dividend income is recorded on the ex-dividend date. Foreign dividend income is recorded on the ex-dividend date or as soon as practical after the Funds determine the existence of a dividend declaration after exercising reasonable due diligence. The cost of investments sold is determined by use of the specific identification method. To the extent any issuer defaults on an expected interest payment, the Funds’ policy is to generally halt any additional interest income accruals and consider the realizability of interest accrued up to the date of default.

(g) Distributions to Shareholders. Distributions from net investment income and distributions of net realized gains, if any, are declared at least annually. Distributions to shareholders of the Funds are recorded on the ex-dividend date and are determined in accordance with income tax regulations, which may differ from GAAP.

(h) REIT Distributions. The character of distributions received from Real Estate Investment Trusts (”REITs”) held by the Funds is generally comprised of net investment income, capital gains, and return of capital. It is the policy of the Funds to estimate the character of distributions received from underlying REITs based on historical data provided by the REITs. After each calendar year end, REITs report the true tax character of these distributions. Differences between the estimated and actual amounts reported by the REITs are reflected in the Funds’ records in the year in which they are reported by the REITs.

(i) Federal and Other Taxes. It is the Funds’ policy to comply with the federal income and excise tax requirements of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies. Accordingly, the Funds intend to distribute substantially all of their income and net realized gains on investments, if any, to shareholders each year. Therefore, no federal income tax provision is required in the Funds’ financial statements. Under the applicable foreign tax laws, a withholding tax may be imposed on interest, dividends and capital gains at various rates.

(j) Reclassification. GAAP requires that certain components of net assets be adjusted to reflect permanent differences between financial and tax reporting. These reclassifications have no effect on net assets or net asset values per share.


2.	Investment Management Agreement and Other Transactions with Affiliates

For the period of this report, Smith Barney Fund Management LLC (“SBFM”), an indirect wholly-owned subsidiary of Legg Mason, Inc. (“Legg Mason”), acted as the investment manager of the Funds. Under the investment management agreement, the Capital and Income Portfolio pays an investment management fee calculated daily and paid

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 45

Notes to Financial Statements (unaudited) (continued)

monthly at an annual rate of 0.75% of the Fund’s average daily net assets. The Appreciation and Fundamental Value Portfolios pay an investment management fee which is calculated daily and paid monthly in accordance with the following breakpoint schedules:


	Management
Average Daily Net Assets	Fee Rate

Appreciation Portfolio
Up to $250 million		0.750	%
Next $250 million		0.700
Next $500 million		0.650
Next $1 billion		0.600
Next $1 billion		0.550
Over $3 billion		0.500

Fundamental Value Portfolio
Up to $1.5 billion		0.750	%
Next $0.5 billion		0.700
Next $0.5 billion		0.650
Next $1 billion		0.600
Over $3.5 billion		0.500

During the six months ended June 30, 2006, the Funds were reimbursed for expenses in the amount of $21,442, $21,395 and $2,226 for the Appreciation Portfolio, Fundamental Value Portfolio and Capital and Income Portfolio, respectively.

Citigroup Global Markets Inc. (“CGM”) and Legg Mason Investor Services, LLC (“LMIS”), a wholly-owned broker-dealer subsidiary of Legg Mason, serve as co-distributors of the Funds.

The Funds have adopted an unfunded, non-qualified deferred compensation plan (the “Plan”) which allows non-interested trustees (“Trustees”) to defer the receipt of all or a portion of the trustees’ fees earned until a later date specified by the Trustees. The deferred fees earn a return based on notional investments selected by the Trustees. The balance of the deferred fees payable may change depending upon the investment performance. Any gains or losses incurred in the deferred balances are reported in the Statements of Operations under Trustees’ fees. Under the Plan, deferred fees are considered a general obligation of the Funds and any payments made pursuant to the Plan will be made from the Funds’ general assets. The Board of Trustees voted to discontinue offering the Plan to its members effective January 1, 2007. This change will have no effect on fees previously deferred.

As of June 30, 2006, the Funds had accrued $3,946, $3,495 and $61 for the Appreciation Portfolio, Fundamental Value Portfolio and Capital and Income Portfolio, respectively, as deferred compensation payable under the Plan.

Certain officers and one Trustee of the Trust are employees of Legg Mason or its affiliates and do not receive compensation from the Trust.

46 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report

Notes to Financial Statements (unaudited) (continued)


3.	Investments

During the six months ended June 30, 2006, the aggregate cost of purchases and proceeds from sales of investments (excluding short-term investments) were as follows:


	Purchases		Sales

Appreciation Portfolio	$	187,795,413	$	218,647,011

Fundamental Value Portfolio		132,544,947		118,314,405

Capital and Income Portfolio		49,337,019		28,456,217

At June 30, 2006, the aggregate gross unrealized appreciation and depreciation of investments for federal income tax purposes were substantially as follows:


	Gross Unrealized		Gross Unrealized			Net Unrealized
	Appreciation		Depreciation			Appreciation

Appreciation Portfolio	$	178,469,006	$	(8,618,801	)	$	169,850,205

Fundamental Value Portfolio		173,693,735		(20,356,908	)		153,336,827

Capital and Income Portfolio		2,508,367		(1,263,565	)		1,244,802

At June 30, 2006, the Capital and Income Portfolio had the following open futures contracts:

Number of

Expiration

Basis

Market

Unrealized

Contracts to Buy:

Contracts

Date

Value

Gain

CME E-Mini S&P 500 Index

150

9/06

9,461,587

9,595,500

133,913

At June 30, 2006, the Capital and Income Portfolio held TBA securities with a total cost of $2,417,695.


4.	Shares of Beneficial Interest

At June 30, 2006, the Trust had an unlimited number of shares of beneficial interest authorized with a par value of $0.001 per share.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 47

Notes to Financial Statements (unaudited) (continued)

Transactions in shares of each Fund were as follows:


	Six Months Ended			Year Ended
	June 30, 2006			December 31, 2005

Appreciation Portfolio
Shares sold		757,316			3,298,780
Shares issued on reinvestment		32,758			311,627
Shares repurchased		(3,545,977	)		(2,854,164	)

Net Increase (Decrease)		(2,755,903	)		756,243

Fundamental Value Portfolio
Shares sold		860,389			1,282,699
Shares issued on reinvestment		158,607			2,914,587
Shares repurchased		(2,597,581	)		(2,920,843	)
Shares issued in connection with merger (Note 5)		—			208,663

Net Increase (Decrease)		(1,578,585	)		1,485,106

Capital and Income Portfolio*
Shares sold		2,736,819			5,070,274
Shares issued on reinvestment		—			72,600
Shares repurchased		(36,784	)		(1,757,107	)

Net Increase		2,700,035			3,385,767


*		The Fund Commenced operations on May 3, 2005.


5.	Transfer of Net Assets

On July 8, 2005, the Fundamental Value Portfolio acquired the assets and certain liabilities of the Greenwich Street Series Fund: Salomon Brothers Variable All Cap Value Fund, a separate series of the Trust, pursuant to a plan of reorganization approved by Greenwich Street Series Fund: Salomon Brothers Variable All Cap Value Fund shareholders on July 1, 2005. Total shares issued by the Fundamental Value Portfolio and the total net assets of the Greenwich Street Series Fund: Salomon Brothers Variable All Cap Value Fund and the Fundamental Value Portfolio on the date of the transfer were as follows:

Total Net Assets of the

Greenwich Street

Shares Issued

Series Fund:

Total Net Assets

by the

Salomon Brothers

of the

Fundamental

Variable All Cap

Fundamental

Acquired Fund

Value Portfolio

Value Fund

Value Portfolio

Greenwich Street Series Fund: Salomon Brothers Variable All Cap Value Fund

208,663

4,385,993

881,695,745

The total net assets of the Greenwich Street Series Fund: Salomon Brothers Variable All Cap Value Fund before acquisition included unrealized appreciation of $508,624, accumulated net realized loss of $1,168,602 and accumulated net investment loss of $2,448. Total net assets of the Fundamental Value Portfolio immediately after the transfer were $886,081,738. The transaction was structured to qualify as a tax-free reorganization under the Internal Revenue Code of 1986, as amended.

48 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report

Notes to Financial Statements (unaudited) (continued)


6.	Capital Loss Carryforward

As of December 31, 2005, the Funds had the following net capital loss carryforwards remaining:


Year of Expiration	Appreciation Portfolio			Fundamental Value Portfolio

10/31/2009		—		$	(766,672	)
10/31/2010	$	(1,677,098	)		(191,668	)
10/31/2011		(7,312,341	)		—

	$	(8,989,439	)	$	(958,340	)

These amounts, subject to various tax limitations, will be available to offset any future taxable capital gains.


7.	Regulatory Matters

On May 31, 2005, the U.S. Securities and Exchange Commission (“SEC”) issued an order in connection with the settlement of an administrative proceeding against SBFM and CGM relating to the appointment of an affiliated transfer agent for the Smith Barney family of mutual funds (the “Funds”).

The SEC order finds that SBFM and CGM willfully violated Section 206(1) of the Investment Advisers Act of 1940 (“Advisers Act”). Specifically, the order finds that SBFM and CGM knowingly or recklessly failed to disclose to the boards of the Funds in 1999 when proposing a new transfer agent arrangement with an affiliated transfer agent that: First Data Investors Services Group (“First Data”), the Funds’ then-existing transfer agent, had offered to continue as transfer agent and do the same work for substantially less money than before; and that Citigroup Asset Management (“CAM”), the Citigroup business unit that, at the time, included the Funds’ investment manager and other investment advisory companies, had entered into a side letter with First Data under which CAM agreed to recommend the appointment of First Data as sub-transfer agent to the affiliated transfer agent in exchange for, among other things, a guarantee by First Data of specified amounts of asset management and investment banking fees to CAM and CGM. The order also finds that SBFM and CGM willfully violated Section 206(2) of the Advisers Act by virtue of the omissions discussed above and other misrepresentations and omissions in the materials provided to the Funds’ boards, including the failure to make clear that the affiliated transfer agent would earn a high profit for performing limited functions while First Data continued to perform almost all of the transfer agent functions, and the suggestion that the proposed arrangement was in the Funds’ best interests and that no viable alternatives existed. SBFM and CGM do not admit or deny any wrongdoing or liability. The settlement does not establish wrongdoing or liability for purposes of any other proceeding.

The SEC censured SBFM and CGM and ordered them to cease and desist from violations of Sections 206(1) and 206(2) of the Advisers Act. The order requires Citigroup to pay $208.1 million, including $109 million in disgorgement of profits, $19.1 million in interest, and a civil money penalty of $80 million. Approximately $24.4 million has already been paid to the Funds, primarily through fee waivers. The remaining $183.7 million, including the penalty, has been paid to the U.S. Treasury and will be distributed pur-

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 49

Notes to Financial Statements (unaudited) (continued)

suant to a plan submitted for the approval of the SEC. At this time, there is no certainty as to how the above-described proceeds of the settlement will be distributed, to whom such distributions will be made, the methodology by which such distributions will be allocated, and when such distributions will be made. The order also required that transfer agency fees received from the Funds since December 1, 2004, less certain expenses, be placed in escrow and provided that a portion of such fees might be subsequently distributed in accordance with the terms of the order. On April 3, 2006, an aggregate amount of approximately $9 million was distributed to the affected Funds.

The order required SBFM to recommend a new transfer agent contract to the Funds’ boards within 180 days of the entry of the order; if a Citigroup affiliate submitted a proposal to serve as transfer agent or sub-transfer agent, SBFM and CGM would have been required, at their expense, to engage an independent monitor to oversee a competitive bidding process. On November 21, 2005, and within the specified timeframe, the Funds’ Board selected a new transfer agent for the Funds. No Citigroup affiliate submitted a proposal to serve as transfer agent. Under the order, SBFM also must comply with an amended version of a vendor policy that Citigroup instituted in August 2004.

Although there can be no assurance, SBFM does not believe that this matter will have a material adverse effect on the Funds.

On December 1, 2005, Citigroup completed the sale of substantially all of its global asset management business, including SBFM, to Legg Mason.


8.	Legal Matters

Beginning in August 2005, five class action lawsuits alleging violations of federal securities laws and state law were filed against CGM and SBFM, (collectively, the “Defendants”) based on the May 31, 2005 settlement order issued against the Defendants by the SEC based in Note 7. The complaints seek injunctive relief and compensatory and punitive damages, removal of SBFM as the advisor for the Smith Barney family of funds, rescission of the Funds’ management and other contracts with SBFM, recovery of all fees paid to SBFM pursuant to such contracts, and an award of attorneys’ fees and litigation expenses.

On October 5, 2005, a motion to consolidate the five actions and any subsequently-filed, related action was filed. That motion contemplates that a consolidated amended complaint alleging substantially similar causes of action will be filed in the future.

As of the date of this report, the Funds’ investment manager believes that resolution of the pending lawsuit will not have a material effect on the financial position or results of operations of the Funds or the ability of the Funds’ investment manager and its affiliates to continue to render services to the Funds under their respective contracts.

* * *

Beginning in June 2004, class action lawsuits alleging violations of the federal securities laws were filed against CGM and a number of its then affiliates, including SBFM and Salomon Brothers Asset Management Inc (“SBAM”), which were then investment adviser or manager to certain of the Funds (the “Managers”), substantially all of the mutual funds then managed by the Managers (the “Defendant Funds”), and Board Members of the Defendant Funds (collectively, the “Defendants”). The complaints alleged, among other

50 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report

Notes to Financial Statements (unaudited) (continued)

things, that CGM created various undisclosed incentives for its brokers to sell Smith Barney and Salomon Brothers funds. In addition, according to the complaints, the Managers caused the Defendant Funds to pay excessive brokerage commissions to CGM for steering clients towards proprietary funds. The complaints also alleged that the defendants breached their fiduciary duty to the Defendant Funds by improperly charging Rule 12b-1 fees and by drawing on fund assets to make undisclosed payments of soft dollars and excessive brokerage commissions. The complaints also alleged that the Defendant Funds failed to adequately disclose certain of the allegedly wrongful conduct. The complaints sought injunctive relief and compensatory and punitive damages, rescission of the Defendant Funds’ contracts with the Managers, recovery of all fees paid to the Managers pursuant to such contracts and an award of attorneys’ fees and litigation expenses.

On December 15, 2004, a consolidated amended complaint (the “Complaint”) was filed alleging substantially similar causes of action. On May 27, 2005, all of the Defendants filed motions to dismiss the Complaint. On July 26, 2006, the court issued a decision and order (1) finding that plaintiffs lacked standing to sue on behalf of the shareholders of the Funds in which none of the plaintiffs had invested and dismissing those Funds from the case (although stating that they could be brought back into the case if standing as to them could be established), and (2) other than one stayed claim, dismissing all of the causes of action against the remaining Defendants, with prejudice, except for the cause of action under Section 36(b) of the Investment Company Act, which the court granted plaintiffs leave to repeal as a derivative claim.


9.	Other Matters

On September 16, 2005, the staff of the SEC informed SBFM and SBAM that the staff is considering recommending that the SEC institute administrative proceedings against SBFM and SBAM for alleged violations of Section 19(a) and 34(b) of the Investment Company Act (and related Rule 19a-1). The notification is a result of an industry wide inspection by the SEC and is based upon alleged deficiencies in disclosures regarding dividends and distributions paid to shareholders of certain funds. Section 19(a) and related Rule 19a-1 of the Investment Company Act generally require funds that are making dividend and distribution payments to provide shareholders with a written statement disclosing the source of the dividends and distributions, and, in particular, the portion of the payments made from each of net investment income, undistributed net profits and/ or paid-in capital. In connection with the contemplated proceedings, the staff may seek a cease and desist order and/or monetary damages from SBFM or SBAM.

Although there can be no assurance, SBFM believes that this matter is not likely to have a material adverse effect on the Funds.


10.	Subsequent Events

The Funds’ Board has approved the appointment of Legg Mason Partners Fund Advisor, LLC (“LMPFA”) as the Funds’ investment manager effective August 1, 2006. The Funds’ Board has also approved the appointment of CAM North America, LLC (“CAM N.A.”) as the Appreciation Portfolio’s and Fundamental Value Portfolio’s subadviser, and CAM N.A.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 51

Notes to Financial Statements (unaudited) (continued)

and Western Asset Management Company (“Western Asset”) as Capital and Income Portfolio’s subadvisers, effective August 1, 2006. The portfolio managers who are responsible for the day-to-day management of the Funds remain the same immediately prior to and immediately after the date of these changes. LMPFA, CAM N.A. and Western Asset are wholly-owned subsidiaries of Legg Mason.

LMPFA will provide administrative and certain oversight services to the Funds. LMPFA will delegate to the subadvisers the day-to-day portfolio management of the Funds, except, in certain cases, for the management of cash and short-term instruments. The Funds’ investment management fee will remain unchanged. For its services, LMPFA will pay the subadvisers 70% of the net management fee that it receives from the Funds. This fee will be divided between the subadvisers, on a pro rata basis, based on the assets allocated to each subadviser, from time to time.

Effective as of July 17, 2006, Robert Gendelman will manage the equity portion of the Capital and Income Portfolio’s assets and also serve as coordinating portfolio manager.

The Board has also approved a reorganization pursuant to which the Capital and Income Portfolio’s assets would be acquired, and its liabilities assumed, by the Legg Mason Partners Variable Multiple Discipline Portfolio — Balanced All Cap Growth and Value (the “Acquiring Fund”), in exchange for shares of the Acquiring Fund. The Capital and Income Portfolio would then be liquidated, and shares of the Acquiring Fund would be distributed to Capital and Income Portfolio shareholders.

Under the reorganization, Capital and Income Portfolio shareholders would receive shares of the Acquiring Fund with the same aggregate net asset value as their shares of the Capital and Income Portfolio. It is anticipated that as a result of the reorganization, Capital and Income Portfolio shareholders would recognize no gain or loss for Federal income tax purposes. The reorganization is subject to the satisfaction of certain conditions, including approval by Capital and Income Portfolio shareholders.

Proxy materials describing the reorganization are expected to be sent to Capital and Income Portfolio shareholders later in 2006. If Capital and Income Portfolio shareholders approve the reorganization, it is expected to occur during 2007.

The Board has also approved a number of other initiatives designed to streamline and restructure the fund complex, and has authorized seeking shareholder approval for those initiatives where shareholder approval is required. As a result, each Fund’s shareholders will be asked to elect a new Board, approve matters that will result in the Funds being grouped for organizational and governance purposes with other funds in the fund complex, and domicile the Funds as a Maryland business trust, with all funds operating under uniform charter documents. Fund shareholders also will be asked to approve investment matters, including standardized fundamental investment policies.

Proxy materials describing these matters are expected to be sent to shareholders later in 2006. If shareholder approval is obtained, these matters generally are expected to be implemented during 2007.

52 Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report

Notes to Financial Statements (unaudited) (continued)

11. Recent Accounting Pronouncement

During June 2006, the Financial Accounting Standards Board (“FASB”) issued FASB Interpretation 48 (“FIN 48” or the “Interpretation”), Accounting for Uncertainty in Income Taxes — an interpretation of FASB statement 109. FIN 48 supplements FASB Statement 109 by defining the confidence level that a tax position must meet in order to be recognized in the financial statements. FIN 48 prescribes a comprehensive model for how a fund should recognize, measure, present, and disclose in its financial statements uncertain tax positions that the fund has taken or expects to take on a tax return. FIN 48 requires that the tax effects of a position be recognized only if it is “more likely than not” to be sustained based solely on its technical merits. Management must be able to conclude that the tax law, regulations, case law, and other objective information regarding the technical merits sufficiently support the position’s sustainability with a likelihood of more than 50 percent. FIN 48 is effective for fiscal periods beginning after December 15, 2006, which for these Funds will be January 1, 2007. At adoption, the financial statements must be adjusted to reflect only those tax positions that are more likely than not to be sustained as of the adoption date. Management of the Fund is currently evaluating the impact that FIN 48 will have on the financial statements.

Legg Mason Partners Variable Portfolios II 2006 Semi-Annual Report 53

Board Approval of Management and Subadvisory Agreements (unaudited)

At a meeting held in person on June 28, 2006, the Funds’ Board, including a majority of the Board Members who are not “interested persons” of the Funds or Legg Mason Partners Fund Advisor, LLC (the “Manager”) or any sub-investment adviser or proposed sub-investment adviser as defined in the Investment Company Act of 1940, as amended (the “1940 Act”) (the “Independent Board Members”), approved new management agreements (the “New Management Agreements”) between the Funds and the Manager. The Funds’ Board, including a majority of the Independent Board Members, also approved one or more new subadvisory agreements between the Manager and each of CAM North America, LLC (“CAM N.A.”) and Western Asset Management Company (“Western Asset”)(each a “Subadviser”) (each a “New Subadvisory Agreement”). The New Management Agreements and the New Subadvisory Agreements replaced the Funds’ prior management agreements with Smith Barney Fund Management LLC (“SBFM”) and were entered into in connection with an internal reorganization of the Manager’s and the prior manager’s parent organization, Legg Mason. In approving the New Management Agreements and New Subadvisory Agreements, the Board, including the Independent Board Members, considered the factors discussed below, among other things.

The Board noted that the Manager will provide administrative and certain oversight services to the Funds, and that the Manager will delegate to each of the Subadvisers the day-to-day portfolio management of the Funds. The Board Members reviewed the qualifications, backgrounds and responsibilities of the senior personnel that will provide oversight and general management services and the portfolio management team that would be primarily responsible for the day-to-day management of the Funds. The Board Members noted that the portfolio management team was expected to be the same as then managing the Funds.

The Board Members received and considered information regarding the nature, extent and quality of services expected to be provided to the Funds by the Manager under the New Management Agreements and by the Subadvisers under the New Subadvisory Agreements. The Board Members’ evaluation of the services expected to be provided by the Manager and the Subadvisers took into account the Board Members’ knowledge and familiarity gained as Fund Board Members, including as to the scope and quality of Legg Mason’s investment management and other capabilities and the quality of its administrative and other services. The Board Members considered, among other things, information and assurances provided by Legg Mason as to the operations, facilities and organization of the Manager and the Subadvisers and the qualifications, backgrounds and responsibilities of their senior personnel. The Board Members further considered the financial resources available to the Manager, the Subadvisers and Legg Mason. The Board Members concluded that, overall, the nature, extent and quality of services expected to be provided under the New Management Agreements and the New Subadvisory Agreements were acceptable.

The Board Members also received and considered performance information for the Funds as well as comparative information with respect to a peer group of funds (the “Performance Universe”) selected by Lipper, Inc. (“Lipper”), an independent provider of

54 Legg Mason Partners Variable Portfolios II

Board Approval of Management and Subadvisory Agreements (unaudited) (continued)

investment company data. The Board Members were provided with a description of the methodology Lipper used to determine the similarity of the Funds to the funds included in the Performance Universe. The Board Members noted that they had received and discussed with management, at periodic intervals, information comparing the Funds’ performance against, among other things, its benchmarks. Based on the Board Members’ review, which included careful consideration of the factors noted above, the Board Members concluded that the performance of the Funds, under the circumstances, supported approval of the New Management Agreements and New Subadvisory Agreements.

The Board Members reviewed and considered the management fee that would be payable by the Funds to the Manager in light of the nature, extent and quality of the management services expected to be provided by the Manager. Additionally, the Board Members received and considered information comparing the Funds’ management fee and overall expenses with those of comparable funds in both the relevant expense group and a broader group of funds, each selected and provided by Lipper. The Board Members also reviewed and considered the subadvisory fee that would be payable by the Manager to the Subadviser in light of the nature, extent and quality of the management services expected to be provided by the Subadvisers. The Board Members noted that the Manager, and not the Funds, will pay the subadvisory fee to each Subadviser. The Board Members determined that the Funds’ management fee and the Funds’ subadvisory fees were reasonable in light of the nature, extent and quality of the services expected to be provided to the Funds under the New Management Agreements and the New Subadvisory Agreements.

The Board Members received and considered a pro-forma profitability analysis of Legg Mason and its affiliates in providing services to the Funds, including information with respect to the allocation methodologies used in preparing the profitability data. The Board Members recognized that Legg Mason may realize economies of scale based on its internal reorganization and synergies of operations. The Board Members noted that it was not possible to predict with a high degree of confidence how Legg Mason’s and its affiliates’ profitability would be affected by its internal reorganization and by other factors including potential economies of scale, but that based on their review of the pro forma profitability analysis, their most recent prior review of the profitability of the predecessor manager and its affiliates from their relationship with the Funds and other factors considered, they determined that the management fees were reasonable. The Board Members noted that they expect to receive profitability information on an annual basis.

In their deliberations, the Board Members also considered, and placed significant importance on, information that had been received and conclusions that had been reached by the Board in connection with the Board’s most recent approval of the Funds’ prior management agreements, in addition to information provided in connection with the Board’s evaluation of the terms and conditions of the New Management Agreements and the New Subadvisory Agreements.

The Board Members considered Legg Mason’s advice and the advice of its counsel that the New Management Agreements and the New Subadvisory Agreements were being entered into in connection with an internal reorganization within Legg Mason, that did

Legg Mason Partners Variable Portfolios II 55

Board Approval of Management and Subadvisory Agreements (unaudited) (continued)

not involve an actual change of control or management. The Board Members further noted that the terms and conditions of the New Management Agreements are substantially identical to those of the Funds’ previous management agreements except for the identity of the Manager, and that the initial term of the New Management Agreements (after which they will continue in effect only if such continuance is specifically approved at least annually by the Board, including a majority of the Independent Board Members) was the same as that under the prior management agreements.

In light of all of the foregoing, the Board, including the Independent Board Members, approved the New Management Agreements and the New Subadvisory Agreements. No single factor reviewed by the Board Members was identified as the principal factor in determining whether to approve the New Management Agreements and the New Subadvisory Agreements. The Independent Board Members were advised by separate independent legal counsel throughout the process. The Independent Board Members also discussed the proposed approval of the New Management Agreements and the New Subadvisory Agreements in private sessions with their independent legal counsel at which no representatives of the Manager or Subadvisers were present.

56 Legg Mason Partners Variable Portfolios II


	Legg Mason Partners
	Variable Portfolios II

TRUSTEES

Dwight B. Crane
Burt N. Dorsett
R. Jay Gerken, CFA
Chairman
Elliot S. Jaffe
Stephen E. Kaufman
Cornelius C. Rose, Jr.

INVESTMENT MANAGER

Legg Mason Partners Fund Advisor, LLC

SUBADVISERS

CAM North America, LLC

Western Asset Management Company

DISTRIBUTORS

Citigroup Global Markets Inc.

Legg Mason Investor
Services, LLC

CUSTODIAN

State Street Bank and Trust Company

TRANSFER AGENT

PFPC, Inc.
4400 Computer Drive

Westborough, Massachusetts 01581

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

KPMG LLP
345 Park Avenue
New York, New York 10154



This report is submitted for the general information of the owners of the Legg Mason Partners Variable Portfolios II – Legg Mason Partners Variable Appreciation Portfolio, Legg Mason Partners Variable Fundamental Value Portfolio and Legg Mason Partners Variable Capital and Income Portfolio and is not for use with the general public. This report must be preceded or accompanied by a free prospectus. Investors should consider the Funds’ investment objectives, risks, charges and expenses carefully before investing. The prospectus contains this and other information about the Funds. Please read the prospectus carefully before investing. www.leggmason.com/InvestorServices ^©2006 Legg Mason Investor Services, LLC Member NASD, SIPC FD03435 8/06 SR06-102		Legg Mason Partners Variable Portfolios II Legg Mason Partners Variable Appreciation Portfolio Legg Mason Partners Variable Fundamental Value Portfolio Legg Mason Partners Variable Capital and Income Portfolio The Funds are separate investment funds of the Legg Mason Partners Variable Portfolios II, a Massachusetts business trust. The Funds file their complete schedule of portfolio holdings with the Securities and Exchange Commission for the first and third quarters of each fiscal year on Form N-Q. The Funds’ Forms N-Q are available on the Commission’s website at www.sec.gov. The Funds’ Forms N-Q may be reviewed and copied at the Commission’s Public Reference Room in Washington D.C., and information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330. To obtain information on Form N-Q from the Funds, shareholders can call 1-800-451-2010. Information on how the Funds voted proxies relating to portfolio securities during the prior 12-month period ended June 30th of each year and a description of the policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available (1) without charge, upon request, by calling 1-800-451-2010, (2) on the Funds’ website at www.leggmason.com/InvestorServices.com and (3) on the SEC’s website at www.sec.gov. Proxy voting reports for the period ending June 30, 2005 will continue to be listed under the Trust’s former Greenwich Street Series Fund name.


ITEM 2.		CODE OF ETHICS.

		Not Applicable.

ITEM 3.		AUDIT COMMITTEE FINANCIAL EXPERT.

		Not Applicable.

ITEM 4.		PRINCIPAL ACCOUNTANT FEES AND SERVICES.

		Not applicable.

ITEM 5.		AUDIT COMMITTEE OF LISTED REGISTRANTS.

		Not applicable.

ITEM 6.		SCHEDULE OF INVESTMENTS.

		Included herein under Item 1.

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 principal executive officer and principal financial officer have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a- 3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective as of a date within 90 days of the filing date of this report that includes the disclosure required by this paragraph, based on their evaluation of the disclosure controls and procedures required by Rule 30a-3(b) under the 1940 Act and 15d-15(b) under the Securities Exchange Act of 1934.

	(b)		There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the registrant’s last fiscal half-year (the registrant’s second fiscal half-year in the case of an annual report) that have materially affected, or are likely to materially affect the registrant’s internal control over financial reporting.

ITEM 12. EXHIBITS.

	(a)		Not applicable.

	(b)		Attached hereto.


		Exhibit 99. CERT		Certifications pursuant to section 302 of the Sarbanes-Oxley Act of 2002

		Exhibit 99.906 CERT		Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

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, there unto duly authorized.

Legg Mason Partners Variable Portfolios II


By:		/s/ R. Jay Gerken
		(R. Jay Gerken)
		Chief Executive Officer of
		Legg Mason Partners Variable Portfolios II

Date: September 8, 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/ R. Jay Gerken
		(R. Jay Gerken)
		Chief Executive Officer of
		Legg Mason Partners Variable Portfolios II

Date: September 8, 2006


By:		/s/ Kaprel Ozsolak
		(Kaprel Ozsolak)
		Chief Financial Officer of
		Legg Mason Partners Variable Portfolios II

Date: September 8, 2006

Legg Mason Partners Variable Portfolios Ii N-CSRSCertified semi-annual shareholder report (management investment company)

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