Morgan Stanley LTD Term Municipal Trust 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: 811-07700

Morgan Stanley Limited Term Municipal Trust
               (Exact name of registrant as specified in charter)

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

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

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

Date of fiscal year end: March 31, 2006

Date of reporting period: September 30, 2005


Item 1 - Report to Shareholders

Welcome, Shareholder:

In this report, you'll learn about how your investment in Morgan Stanley Limited Term Municipal Trust performed during the semiannual period. We will provide an overview of the market conditions, and discuss some of the factors that affected performance during the reporting period. In addition, this report includes the Fund's financial statements and a list of Fund investments.

This material must be preceded or accompanied by a prospectus for the fund being offered.

Market forecasts provided in this report may not necessarily come to pass. There is no assurance that the Fund will achieve its investment objective. The Fund is subject to market risk, which is the possibility that market values of securities owned by the Fund will decline and, therefore, the value of the Fund's shares may be less than what you paid for them. Accordingly, you can lose money investing in this Fund. Please see the prospectus for more complete information on investment risks.



	Fund Report
	For the six months ended September 30, 2005

Total Return for the 6 Months Ended September 30, 2005


Morgan Stanley Limited Term Municipal Trust	Lehman Brothers Municipal Bond Index (10-Year)¹			Lipper Intermediate Municipal Debt Funds Index²
2.67%		2.66	%		2.19	%

The Fund's total return assumes the reinvestment of all distributions. See Performance Summary for standardized performance and benchmark information.

Market Conditions

During the six months ended September 30, 2005, data continued to show moderate economic growth, sustained consumer spending and reasonable gains in employment. Although core inflation (which excludes energy and food) remained benign, inflationary concerns mounted as heavy demand and geopolitical events drove oil prices to protracted highs. September brought heightened uncertainty in the wake of the unprecedented devastation caused by Hurricanes Katrina and Rita. The immediate economic impact was a major disruption to the nation's energy infrastructure.

Continuing the "measured" rate tightening cycle that began in June of 2004, the Federal Open Market Committee (the "Fed") raised the federal funds target rate four times during reporting period. As a result, the rate rose from 2.75 percent to 3.75 percent, a four-year high.

Through most of the period, the yields of short maturity bonds also rose in response to the Fed's actions. However, on the whole, intermediate-term (10-year) municipal bond yields moved lower. The representative yields of 10-year AAA rated municipal bonds declined from 3.85 percent at the start of the period to a low of 3.45 percent in the summer, then rose to 3.75 percent at the end of September. Overall, the municipal yield curve continued to flatten and the yield spread (or differential between one-year rates and 10-year rates) narrowed.

Led by a surge in refinancing activity, municipal issuance remained strong in 2005. New issue volume increased by 13 percent to $275 billion, a record for the first nine months of a calendar year. As issuers rushed to refinance higher cost debt, refundings increased to 35 percent of total issuance, up from 24 percent in 2004. Bonds backed by insurance dominated issuance and increased their market penetration to 60 percent. Issuers in California, Texas, New York, Florida and Pennsylvania accounted for more than 40 percent of the total underwriting volume during the year-to-date period.

The municipal-to-Treasury yield ratio, which gauges performance between the two markets, remained attractive for tax-exempt bonds. The 10-year ratio averaged 86 percent during the period. (Higher ratios indicate increased relative attractiveness of municipal bonds.) As a result, institutional investors that normally focus on taxable bond sectors supported municipals by "crossing over" to purchase tax-exempt bonds.

Performance Analysis

Morgan Stanley Limited Term Municipal Trust outperformed the Lehman Brothers Municipal Bond Index (10-Year) and the Lipper Intermediate Municipal Debt Funds Index for the six months ended September 30, 2005.

The Fund's performance benefited from its emphasis on bonds with maturities near the 10-year mark. During the period, the Fund maintained a conservative strategy in anticipation of continued Fed tightening and higher interest rates. As a result, the Fund's duration* (a measure of interest rate sensitivity) was lower than that of its Lehman benchmark. Overall, the Fund's duration positioning tempered total returns when rates declined, but helped total returns when rates rose later in the period. The Fund's option-adjusted duration was 4.9 years as of September 30, 2005.

Throughout the period, the Fund maintained a high average credit quality, with 92 percent of the bonds in the portfolio rated A or higher as of the end of the reporting period. Reflecting a commitment to diversification, the Fund's net assets of $201 million were invested among 13 long-term sectors and 102 credits.

* A measure of the sensitivity of a bond's price to changes in interest rates, expressed in years. Each year of duration represents an expected 1 percent change in the price of a bond for every 1 percent change in interest rates. The longer a bond's duration, the greater the effect of interest-rate movements on its price. Typically, funds with shorter durations perform better in rising-interest-rate environments, while funds with longer durations perform better when rates decline.

Investment Strategy

The Fund will normally invest at least 80 percent of its assets in intermediate-term securities that pay interest exempt from federal income taxes. This policy is fundamental and may not be changed without shareholder approval. The Fund's "Investment Adviser," Morgan Stanley Investment Advisors Inc., generally invests the Fund's assets in municipal obligations. Municipal obligations are bonds, notes or short-term commercial paper issued by state governments, local governments and their respective agencies. In deciding which securities to buy, hold or sell, the Investment Adviser considers market, economic and political conditions.

For More Information About Portfolio Holdings

Each Morgan Stanley fund provides a complete schedule of portfolio holdings in its semiannual and annual reports within 60 days of the end of the fund's second and fourth fiscal quarters by filing the schedule electronically with the Securities and Exchange Commission (SEC). The semiannual reports are filed on Form N-CSRS and the annual reports are filed on Form N-CSR. Morgan Stanley also delivers the semiannual and annual reports to fund shareholders and makes these reports available on its public Web site, www.morganstanley.com. Each Morgan Stanley fund also files a complete schedule of portfolio holdings with the SEC for the fund's first and third fiscal quarters on Form N-Q. Morgan Stanley does not deliver the reports for the first and third fiscal quarters to shareholders, nor are the reports posted to the Morgan Stanley public Web site. You may, however, obtain the

There is no guarantee that any sectors mentioned will continue to perform well or that securities in such sectors will be held by the Fund in the future.


TOP FIVE SECTORS
General Obligation	16.0	%
Public Facilities	13.6
Transportation Facilities	12.0
Educational Facilities	11.8
Electric	10.8


LONG-TERM CREDIT ANALYSIS
Aaa/AAA	73.2	%
Aa/AA	10.4
A/A	8.4
Baa/BBB	4.6
Non-Rated	3.4

Data as of September 30, 2005. Subject to change daily. All percentages for top five sectors are as a percentage of net assets and all percentages for long-term credit analysis are as a percentage of total long-term investments. These data are provided for informational purposes only and should not be deemed a recommendation to buy or sell the securities mentioned. Morgan Stanley is a full-service securities firm engaged in securities trading and brokerage activities, investment banking, research and analysis, financing and financial advisory services.

Form N-Q filings (as well as the Form N-CSR and N-CSRS filings) by accessing the SEC's Web site, http://www.sec.gov. You may also review and copy them at the SEC's Public Reference Room in Washington, DC. Information on the operation of the SEC's Public Reference Room may be obtained by calling the SEC at (800) SEC-0330. You can also request copies of these materials, upon payment of a duplicating fee, by electronic request at the SEC's e-mail address (publicinfo@sec.gov) or by writing the Public Reference section of the SEC, Washington, DC 20549-0102.

Householding Notice

To reduce printing and mailing costs, the Fund attempts to eliminate duplicate mailings to the same address. The Fund delivers a single copy of certain shareholder documents, including shareholder reports, prospectuses and proxy materials, to investors with the same last name who reside at the same address. Your participation in this program will continue for an unlimited period of time unless you instruct us otherwise. You can request multiple copies of these documents by calling (800) 350-6414, 8:00 a.m. to 8:00 p.m., ET. Once our Customer Service Center has received your instructions, we will begin sending individual copies for each account within 30 days.



	Distribution by Maturity
	(% of Long-Term Portfolio) As of September 30, 2005

Weighted Average Maturity: 9 Years^(a)

(a)

Where applicable maturities reflect mandatory tenders, puts and call dates.

Portfolio structure is subject to change.

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


Alabama	1.9	%
Alaska	0.6
Arizona	2.2
Arkansas	1.2
California	11.7
Colorado	2.2
Delaware	1.1
Florida	10.3
Georgia	1.9
Hawaii	0.5	%
Illinois	5.6
Indiana	1.9
Kansas	1.5
Kentucky	0.3
Maine	1.1
Maryland	3.3
Massachusetts	1.1
Michigan	1.9
Minnesota	1.6	%
Missouri	5.9
Nevada	2.0
New Hampshire	0.9
New Jersey	3.2
New York	11.7
Ohio	2.1
Oregon	2.7
Pennsylvania	3.8
South Carolina	0.5	%
Tennessee	0.8
Texas	6.0
Virginia	2.9
Washington	3.8
Total†	98.2	%

† Does not include open short futures contracts with an underlying face amount of $54,195,315, with unrealized appreciation of $431,042.



	Performance Summary

Average Annual Total Returns — Period Ended September 30, 2005


	(since 07/12/93)
Symbol	DWLTX
1 Year		2.73	%³
5 Years		4.98	³
10 Years		4.59	³
Since Inception		4.50	³

Performance data quoted represents past performance, which is no guarantee of future results and current performance may be lower or higher than the figures shown. For most recent month-end performance figures, please visit www.morganstanley.com or speak with your Financial Advisor. Investment returns and principal value will fluctuate and fund shares, when redeemed, may be worth more or less than their original cost. The table does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.

(1)

The Lehman Brothers Municipal Bond Index (10-Year) measures the performance of municipal bonds rated at least Baa+ by Moody's Investors Service, Inc., and with maturities ranging between 8 and 12 years. Indexes are unmanaged and their returns do not include any sales charges or fees. Such costs would lower performance. It is not possible to invest directly in an index.

(2)

The Lipper Intermediate Municipal Debt Funds Index is an equally weighted performance index of the largest qualifying funds (based on net assets) in the Lipper Intermediate Municipal Debt Funds classification. The Index, which is adjusted for capital gains distributions and income dividends, is unmanaged and should not be considered an investment. There are currently 30 funds represented in this Index.

(3)

Figure shown assumes reinvestment of all distributions. There is no sales charges.



	Expense Example

As a shareholder of the Fund, you incur ongoing costs, including advisory fees and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period 04/01/05 – 09/30/05.

Actual Expenses

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

Hypothetical Example for Comparison Purposes

The second line of the table below provides information about hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. 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 this information to compare the ongoing cost of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only. Therefore, the second line of the table is useful in comparing ongoing costs, and will not help you determine the relative total cost of owning different funds that have transactional costs, such as sales charges (loads), and redemption fees, or exchange fees.


	Beginning Account Value		Ending Account Value		Expenses Paid During Period*
	04/01/05		09/30/05		04/01/05 − 09/30/05
Actual (2.67% return)	$	1,000.00	$	1,026.70	$	3.15
Hypothetical (5% annual return before expenses)	$	1,000.00	$	1,021.96	$	3.14

Expenses are equal to the Fund's annualized expense ratio of 0.62% multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period).

Investment Advisory Agreement Approval

Nature, Extent and Quality of Services

The Board reviewed and considered the nature and extent of the investment advisory services provided by the Investment Adviser under the Advisory Agreement, including portfolio management, investment research and fixed income securities trading. The Board also reviewed and considered the nature and extent of the non-advisory, administrative services provided by the Fund's Administrator under the Administration Agreement, including accounting, clerical, bookkeeping, compliance, business management and planning, and the provision of supplies, office space and utilities at the Adviser's expense. (The Investment Adviser and the Administrator together are referred to as the "Adviser" and the Advisory and Administration Agreements together are referred to as the "Management Agreement.") The Board also compared the nature of the services provided by the Adviser with similar services provided by non-affiliated advisers as reported to the Board by Lipper Inc. ("Lipper").

The Board reviewed and considered the qualifications of the portfolio managers, the senior administrative managers and other key personnel of the Adviser who provide the administrative and investment advisory services to the Fund. The Board determined that the Adviser's portfolio managers and key personnel are well qualified by education and/or training and experience to perform the services in an efficient and professional manner. The Board concluded that the nature and extent of the advisory and administrative services provided were necessary and appropriate for the conduct of the business and investment activities of the Fund. The Board also concluded that the overall quality of the advisory and administrative services was satisfactory.

Performance Relative to Comparable Funds Managed by Other Advisers

The Board reviewed the Fund's performance for the one-, three- and five-year periods ended November 30, 2004, as shown in reports provided by Lipper (the "Lipper Reports"), compared to the performance of comparable funds selected by Lipper (the "performance peer group"), and noted that the Fund's performance was lower than its performance peer group average for all three periods. The Board discussed with the Adviser possible steps to improve performance. The Board considered that the Fund's defensive positioning in the most recent year reduced the Fund's risk exposure and that the Fund's performance was close to the performance of its performance peer group year by year over the previous four years. The Board concluded that the Fund's performance can reasonably be expected to be competitive with that of its performance peer group.

Fees and Expenses Relative to Comparable Funds Managed by Other Advisers

The Board reviewed the advisory and administrative fees (together, the "management fee") paid by the Fund under the Management Agreement and total expense ratio of the Fund. The Board noted that: (i) the Fund's management fee rate was higher than the average management fee rate for funds, selected by Lipper (the "expense peer group"), managed by other advisers, with investment strategies comparable to those of the Fund, as shown in the Lipper Report for this Fund; and (ii) the Fund's total expense ratio was also higher than the average total expense ratio of the funds included in the Fund's expense peer group. The Board and the Adviser discussed the fee and total expense ratio and the Adviser agreed to impose a cap of 0.60% on the Fund's total expenses, which would have the effect of reducing the management fee and/or other expenses of the Fund. The Board concluded that with the proposed cap, the Fund's management fee and total expense ratio would be competitive with its expense peer group.

Breakpoints and Economies of Scale

The Board reviewed the structure of the Fund's management fee schedule under the Management Agreement and noted that it does not include any breakpoints. The Board also noted that the Fund's assets were relatively small and growing only slowly. The board concluded it did not need to consider economies of scale at this time.

Profitability of Adviser and Affiliates

The Board considered and reviewed information concerning the costs incurred and profits realized by the Adviser and its affiliates during the last two years from their relationship with the Fund and the Morgan Stanley Fund Complex and reviewed with the Controller of the Adviser the cost allocation methodology used to determine the Adviser's profitability. Based on their review of the information they received, the Board concluded that the profits earned by the Adviser and its affiliates were not excessive in light of the advisory, administrative and other services provided to the Fund.

Fall-Out Benefits

The Board considered so-called "fall-out benefits" derived by the Adviser and its affiliates from their relationship with the Fund and the Morgan Stanley Fund Complex, such as "float" benefits derived from handling of checks for purchases and redemptions of Fund shares through a broker-dealer affiliate of the Adviser. The Board considered the float benefits and concluded that they were relatively small.

Soft Dollar Benefits

The Board considered whether the Adviser realizes any benefits from commissions paid to brokers who execute securities transactions for the Fund ("soft dollars"). The Board noted that the Fund invests only in fixed income securities, which do not generate soft dollars.

Adviser Financially Sound and Financially Capable of Meeting the Fund's Needs

The Board considered whether the Adviser is financially sound and has the resources necessary to perform its obligations under the Management Agreement. The Board noted that the Adviser's operations remain profitable, although increased expenses in recent years have reduced the Adviser's profitability. The Board concluded that the Adviser has the financial resources necessary to fulfill its obligations under the Management Agreement.

Historical Relationship Between the Fund and the Adviser

The Board also reviewed and considered the historical relationship between the Fund and the Adviser, including the organizational structure of the Adviser, the policies and procedures formulated and adopted by the Adviser for managing the Fund's operations and the Board's confidence in the competence and integrity of the senior managers and key personnel of the Adviser. The Board concluded that it is beneficial for the Fund to continue its relationship with the Adviser.

Other Factors and Current Trends

The Board considered the controls and procedures adopted and implemented by the Adviser and monitored by the Fund's Chief Compliance Officer and concluded that the conduct of business by the Adviser indicates a good faith effort on its part to adhere to high ethical standards in the conduct of the Fund's business.

General Conclusion

After considering and weighing all of the above factors, the Board concluded it would be in the best interest of the Fund and its shareholders to approve renewal of the Management Agreement for another year.

Morgan Stanley Limited Term Municipal Trust

Portfolio of Investments September 30, 2005 (unaudited)


PRINCIPAL AMOUNT IN THOUSANDS			COUPON RATE			MATURITY DATE		VALUE
		Tax-Exempt Municipal Bonds (96.8%)
		General Obligation (16.0%)
$	3,150	La Mesa-Spring Valley School District, California, 2005 Refg (FGIC)		5.00	%		08/01/18	$	3,402,567
	1,000	Jefferson County School District No R-1, Colorado, Ser 2004 (FSA)		5.00			12/15/15		1,086,450
	1,000	Pueblo School District No 60, Colorado, Ser 2002 (FSA)		5.375			12/15/14		1,111,620
	2,000	Sussex County, Delaware, Ser 2003 (Ambac)		5.00			10/15/11		2,172,040
	1,500	Evanston, Illinios, Ser 2005		5.00			12/01/18		1,604,655
		Du Page County Community Unit School District No 200, Illinois,
	1,600	Wheaton Warrenville Ser 2003 C (FSA)		5.25			10/01/14		1,757,072
	1,465	Wheaton Warrenville Ser 2003 C (FSA)		5.25			10/01/15		1,610,401
	1,000	Massachusetts, Ser 2001 D (MBIA)		6.00			11/01/13		1,155,280
	3,000	Jackson County Reorganized School District No 4, Missouri, Ser 2005 (FSA)		5.00			03/01/17		3,175,770
		New York City, New York,
	1,000	2003 Ser C (FSA)		5.25			08/01/11		1,094,370
	3,000	2005 Ser H		5.00			08/01/15		3,210,450
	2,000	2005 Ser F		5.00			09/01/18		2,121,140
	2,000	Allegheny County, Pennsylvania, Refg Ser C-56 (FSA)		5.00			10/01/14		2,188,720
	2,000	Bellevue School District No 405, Washington, Ser 2002 (FGIC)		5.00			12/01/15		2,153,320
	2,030	North Kitsap School District No 400, Washington, Refg Ser 2005 (FSA)		5.125			12/01/18		2,206,245
	2,000	Spokane School District No 81, Washington, Ser 2003 (FSA)		5.25			12/01/13		2,196,840
	29,745								32,246,940
		Educational Facilities Revenue (11.8%)
	1,000	University of Arizona, Ser 2005 B COPs (Ambac)		5.00			06/01/20		1,057,680
	3,000	Miami-Dade County Educational Facilities Authority, Florida, University of Miami Ser 2004 A (Ambac)		5.00			04/01/16		3,228,990
	1,500	University of Central Florida, UCF Convocation Corp Ser 2005 A COPs (FGIC)		5.00			10/01/17		1,616,895
	3,000	University of Illinois, Ser 2003 COPs (Ambac)		5.00			10/01/14		3,244,980
	1,000	Purdue University, Indiana, Student Facilities Ser 2003 A		5.375			07/01/14		1,100,970
	2,000	University of Maine, Ser 2002 (FSA)		5.375			03/01/12		2,213,640
	1,000	New Jersey Educational Facilities Authority, Rowan University Ser 2003 I (FGIC)		5.25			07/01/14		1,099,690
	2,500	New York State Dormitory Authority, New York, Columbia University Ser 2004 C (Mandatory Tender 07/01/07)		5.00			07/01/29		2,583,350
	1,000	Pennsylvania State University, Refg Ser 2002		5.25			08/15/13		1,107,020
	1,000	Swarthmore Borough Authority, Pennsylvania, Swarthmore College Ser 2002		5.25			09/15/14		1,099,200

See Notes to Financial Statements

Morgan Stanley Limited Term Municipal Trust

Portfolio of Investments September 30, 2005 (unaudited) continued


PRINCIPAL AMOUNT IN THOUSANDS			COUPON RATE			MATURITY DATE		VALUE
$	490	Chattanooga Health, Educational and Housing Facilities Board, Tennessee, University of Tennessee Chattanooga Refg Ser 2005 A		5.00	%		10/01/15	$	501,819
	1,000	Southwest Higher Education Authority, Texas, Southern Methodist University Ser 2002 (Ambac)		5.50			10/01/13		1,116,820
	2,000	Texas Tech University, Refg & Impr Ser 2003 (Ambac)		5.25			02/15/15		2,188,560
	1,500	University of Texas, Ser 2004 D		5.25			08/15/13		1,657,290
	21,990								23,816,904
		Electric Revenue (10.8%)
	1,000	Arizona Power Authority, Hoover Uprating Refg Ser 2001A		5.25			10/01/16		1,115,570
		California Department of Water Resources,
	1,000	Power Supply Ser 2002 A (MBIA)		5.50			05/01/13		1,119,340
	2,000	Power Supply Ser 2002 A (Ambac)		5.50			05/01/14		2,235,680
	2,000	Jacksonville Electric Authority, Florida, St Johns River Power Park Refg Issue 2 Ser 17		5.25			10/01/13		2,170,320
	2,000	Municipal Electric Authority of Georgia, Combustion Turbine Ser 2002 A (MBIA)		5.25			11/01/14		2,193,840
	2,000	Michigan Public Power Agency, Belle River Refg 2002 Ser A (MBIA)		5.25			01/01/12		2,193,160
	2,000	Southern Minnesota Municipal Agency, Power Ser 2002 A (Ambac)		5.00			01/01/12		2,166,480
	1,000	Long Island Power Authority, New York, Ser 1998 B (MBIA)		5.125			04/01/11		1,052,830
	3,000	Ohio Municipal Electric Generation Agency, American Municipal Power-Ohio Inc Refg 2004 (Ambac)		5.00			02/15/16		3,225,960
	1,000	South Carolina Public Service Authority, Refg Ser 2002 D (FSA)		5.25			01/01/15		1,091,110
	1,000	Memphis, Tennesse, Jr Lien Refg Ser 2002		5.00			12/01/10		1,075,220
	1,000	Lower Colorado River Authority, Texas, LCRA Services Corp Refg Ser 2004 (FGIC)		5.00			05/15/19		1,053,850
	1,000	Seattle, Washington, Municipal Light & Power Refg Ser 2001		5.625			12/01/14		1,081,210
	20,000								21,774,570
		Hospital Revenue (6.7%)
	1,250	University of Arkansas, UAMS Campus Ser 2004 A (MBIA)		5.00			11/01/12		1,365,500
	1,000	Washington County, Arkansas, Washington Regional Medical Center Ser 2005 B		5.00			02/01/19		1,018,990
	2,000	California Health Facilities Financing Authority, Cedars-Sinai Medical Center Refg Ser 2005		5.00			11/15/19		2,097,940
		California Statewide Communities Development Authority,
	1,000	Daughters of Charity St Francis Medical Center Ser 2005 G		5.25			07/01/13		1,066,080
	1,825	Adventist Health West Ser 2005 A (WI)		5.00			03/01/19		1,911,085
	1,000	Alachua County Health Facilities Authority, Florida, Shands Teaching Hospital & Clinics Ser 1996 A (MBIA)		6.25			12/01/11		1,144,190

See Notes to Financial Statements

Morgan Stanley Limited Term Municipal Trust

Portfolio of Investments September 30, 2005 (unaudited) continued


PRINCIPAL AMOUNT IN THOUSANDS			COUPON RATE			MATURITY DATE		VALUE
$	1,000	Tampa, Florida, Catholic Health East Ser 1998 A-1 (MBIA)		5.50	%		11/15/14	$	1,122,630
	2,500	Indiana Health Facilities Financing Authority, Community Hospitals Ser 2005 A (Ambac)		5.00			05/01/20		2,662,500
	1,000	Maryland Health & Higher Educational Facilities Authority, Medlantic/Helix Ser 1998 A (FSA)		5.25			08/15/12		1,063,940
	12,575								13,452,855
		Industrial Development/Pollution Control Revenue (5.0%)
	1,000	California Pollution Control Financing Authority, San Diego Gas & Electric Co 1996 Ser A		5.90			06/01/14		1,145,700
	3,000	Clark County Pollution Control Financing Authority, Nevada, Southern Callifornia Edison Co 2000 Ser C (AMT) (Mandatory Tender 03/02/09)		3.25			06/01/31		2,944,140
	1,000	Westchester Tobacco Asset Securitization Corporation, New York, Ser 2005		5.00			06/01/26		1,015,650
	1,725	Sabine River Authority, Texas, TXU Electric Co Refg Ser 2001 B (AMT) (Mandatory Tender 11/01/11)		5.75			05/01/30		1,846,181
	2,000	Chesterfield County Industrial Development Authority, Virginia, Virginia Electric & Power Co Ser 1985		5.50			10/01/09		2,068,620
	1,000	Tobacco Settlement Financing Corporation, Virginia, Asset Backed Ser 2005		5.25			06/01/19		1,037,950
	9,725								10,058,241
		Mortgage Revenue – Single Family (0.5%)
	1,000	Virginia Housing Development Authority, 2001 Ser J (MBIA)		4.75			01/01/12		1,049,680
		Public Facilities Revenue (13.6%)
		Jefferson County, Alabama,
	1,580	School Ser 2004 A		5.25			01/01/11		1,698,184
	2,000	School Ser 2004 A		5.25			01/01/15		2,155,180
	2,000	Val Verde Unified School District, California, Ser 2005 B COPs		5.00			01/01/23		2,094,140
	1,000	Collier County School Board, Florida, Ser 2005 COPs (FSA)		5.00			02/15/16		1,086,410
	3,000	Manatee County School District, Florida, Sales Tax Ser 2003 (Ambac)		5.00			10/01/15		3,250,710
	2,000	Orange County School Board, Florida, Ser 2001 A COPs (Ambac)		5.25			08/01/14		2,195,100
	595	Kentucky Property & Buildings Commission, Project # 69 Ser A (FSA)		5.25			08/01/15		646,069
	2,000	Kansas City School District, Missouri, Elementary School Refg Ser 2003 B (FGIC)		5.00			02/01/14		2,168,820
	2,000	Missouri Board of Public Buildings, Ser A 2003		5.50			10/15/13		2,255,520
	2,000	New Jersey Economic Development Authority, School Facilities Construction Refg 2005 Ser N-1 (Ambac)		5.00			09/01/17		2,168,340

See Notes to Financial Statements

Morgan Stanley Limited Term Municipal Trust

Portfolio of Investments September 30, 2005 (unaudited) continued


PRINCIPAL AMOUNT IN THOUSANDS			COUPON RATE			MATURITY DATE		VALUE
$	3,000	Erie County Industrial Development Agency, New York, School District of Buffalo Ser 2003 (FSA)		5.75	%		05/01/14	$	3,405,990
	1,000	New York State Urban Development Corporation, Correctional & Youth Facilities Refg Ser 2003 A (Mandatory Tender 01/01/09)		5.25			01/01/21		1,056,680
	1,000	Ohio Building Authority, Highway Safety Building 2001 Ser A		5.50			10/01/15		1,102,600
	2,000	Oregon Department of Administrative Services, State Lottery Refg Ser 2004 A (FSA)		5.00			04/01/15		2,173,740
	25,175								27,457,483
		Recreational Facilities Revenue (0.9%)
	1,575	Detroit, Michigan, CoBo Hall Ser 2003 (MBIA)		5.00			09/30/13		1,707,725
		Resource Recovery Revenue (3.8%)
	3,000	Northeast Maryland Waste Disposal Authority, Montgomery County Refg Ser 2003 (AMT) (Ambac)		5.50			04/01/12		3,282,360
	1,000	Massachusetts Development Finance Agency, SEMASS Ser 2001A (MBIA)		5.625			01/01/12		1,102,710
	3,000	Harrisburg Authority, Pennsylvania, Ser D 2003 (FSA) (Mandatory Tender 10/01/13)		5.00			12/01/33		3,235,770
	7,000								7,620,840
		Tax Allocation Revenue (4.2%)
	3,000	Burbank Public Financing Authority, California, 2003 Ser A (Ambac)		5.25			12/01/14		3,313,320
	2,000	Village of Pingree Grove, Illinois, Cambridge Lakes Ser 2005-1		5.25			03/01/15		2,022,880
	3,000	Unified Government of Wyandotte County/Kansas City, Kansas, Area B Refg Ser 2005		4.75			12/01/16		3,064,170
	8,000								8,400,370
		Transportation Facilities Revenue (12.0%)
	1,000	Alaska Internationall Airports, Ser 2002 B (Ambac)		5.75			10/01/13		1,120,220
	2,800	Orange County Transportation Authority, California, Toll Road Refg Ser 2003 A (Ambac)		5.25			08/15/14		3,098,648
	2,000	Colorado Department of Transportation, Refg Ser 2002 B (MBIA)		5.00			06/15/11		2,163,380
	1,000	Greater Orlando Aviation Authority, Florida, Ser 1997 (AMT) (FGIC)		5.75			10/01/11		1,104,070
	2,000	Miami-Dade County Aviation, Florida, Miami Int'l Airport Ser 2003 D (AMT) (MBIA)		5.00			10/01/12		2,144,440
	1,055	Southwestern Development Authority, Illinois, Tri-City Regional Port District Refg Ser 2003 A (AMT)		4.90			07/01/14		1,060,898
	2,000	Maryland Department of Transportation, Ser 2003		5.25			12/15/14		2,239,440
	1,000	Minneapolis & St. Paul, Metropolitan Airports Commission, Minnesota, Ser 2005 B (AMT) (Ambac)		5.00			01/01/20		1,063,510
	1,000	Missouri Highways & Transportation Commission, Ser A 2000		5.625			02/01/15		1,100,780

See Notes to Financial Statements

Morgan Stanley Limited Term Municipal Trust

Portfolio of Investments September 30, 2005 (unaudited) continued


PRINCIPAL AMOUNT IN THOUSANDS			COUPON RATE			MATURITY DATE		VALUE
$	1,100	St Louis, Missouri, Lambert-St Louis Int'l Airport Ser 2003 A (FSA)		5.25	%		07/01/12	$	1,208,922
	1,000	Clark County, Nevada, Aviation Fuel Tax Ser 2003 C (AMT) (Ambac)		5.00			07/01/13		1,062,950
	1,750	New Hampshire, Turnpike Refg Ser 2003 (Ambac)		5.00			02/01/16		1,878,625
	2,000	Metropolitan Transportation Authority, New York, Transportation Ser 2003 A (FGIC)		5.00			11/15/13		2,184,320
	1,000	Triborough Bridge & Tunnel Authority, New York, Ser 2001 A		5.25			01/01/14		1,090,130
	1,500	Richmond Metropolitan Authority, Virginia, Ser 2002 (FGIC)		5.25			07/15/13		1,661,730
	22,205								24,182,063
		Water & Sewer Revenue (7.5%)
	2,000	Arizona Water Infrastructure Finance Authority, Water Quality Refg Ser 2004 A		5.00			10/01/17		2,166,460
	1,500	Indian Trace Development District, Florida, Water Mgmt Refg Ser 2005 (MBIA)		5.00			05/01/20		1,618,440
	1,500	Clayton County Water Authority, Georgia, Refg Ser 2003		5.25			05/01/14		1,664,055
	1,000	Honolulu City & County, Hawaii, Wastewater Jr Ser 1998 (FGIC)		5.25			07/01/13		1,074,700
	2,000	Passaic Valley Sewage Commission, New Jersey, Sewer Ser 2003 (FGIC)		5.00			12/01/14		2,171,200
	3,000	Portland, Oregon, Sewer Refg 2004 Ser B (FSA)		5.00			06/01/17		3,257,250
	1,000	Houston, Texas, Combined Utility First Lien Refg Ser 2004 A (MBIA)		5.25			05/15/10		1,079,980
	2,000	West Harris County Regional Water Authority, Texas, Ser 2005 (FSA)		5.00			12/15/17		2,145,500
	14,000								15,177,585
		Other Revenue (4.0%)
	2,000	Golden State Tobacco Securitization Corporation, California, Ser 2005 A (Ambac)		5.00			06/01/21		2,095,800
	1,000	New Jersey Economic Development Authority, Cigarette Tax Ser 2004 (FGIC)		5.00			06/15/12		1,077,660
	1,500	Nassau County Interim Authority, New York, Sales Tax Ser 2003 A (Ambac)†		5.00			11/15/15		1,625,850
	3,000	Tobacco Settlement Financing Corporation, New York, State Contingency Ser 2003 B		5.50			06/01/15		3,238,140
	7,500								8,037,450
	180,490	Total Tax-Exempt Municipal Bonds (Cost $192,773,129)							194,982,706

See Notes to Financial Statements

Morgan Stanley Limited Term Municipal Trust

Portfolio of Investments September 30, 2005 (unaudited) continued


PRINCIPAL AMOUNT IN THOUSANDS			COUPON RATE			MATURITY DATE			VALUE
		Short-Term Tax-Exempt Municipal Obligations (1.4%)
$	1,900	Missouri Health & Educational Facilities Authority, Cox Health Ser 1997 (MBIA) (Demand 10/03/05)		2.79*	%		06/01/15		$	1,900,000
	1,000	North Central Texas Health Facilities Development Corporation, Presbyterian Medical Center Ser 1985 D (MBIA) (Demand 10/03/05)		2.93	*		12/01/15			1,000,000
	2,900	Total Short-Term Tax-Exempt Municipal Obligations (Cost $2,900,000)								2,900,000
$	183,390	Total Investments (Cost $195,673,129) (a) (b)					98.2	%		197,882,706
		Other Assets in Excess of Liabilities					1.8			3,589,646
		Net Assets					100.0	%	$	201,472,352

AMT

Alternative Minimum Tax.

COPs

Certificates of Participation.

Security purchased on a when-issued basis.

†

A portion of this security has been physically segregated in connection with open futures contracts in the amount of $312,500.

Current coupon of variable rate demand obligation.

(a)

Securities have been designated as collateral in an amount equal to $56,226,318 in connection with open futures contracts and a security purchased on a when-issued basis.

(b)

The aggregate cost for federal income tax purposes approximates the aggregate cost for book purposes. The aggregate gross unrealized appreciation is $2,795,874 and the aggregate gross unrealized depreciation is $584,863, resulting in net unrealized appreciation of $2,211,011.

Bond Insurance:

Ambac

Ambac Assurance Corporation.

FGIC

Financial Guaranty Insurance Company.

FSA

Financial Security Assurance Inc.

MBIA

Municipal Bond Investors Assurance Corporation.

Futures Contracts Open at September 30, 2005:


NUMBER OF CONTRACTS	LONG/SHORT	DESCRIPTION, DELIVERY MONTH AND YEAR	UNDERLYING FACE AMOUNT AT VALUE	UNREALIZED APPRECIATION
250	Short	U.S. Treasury Notes 5 Yr December 2005	$(26,714,845)	$160,642
250	Short	U.S. Treasury Notes 10 Yr December 2005	(27,480,470)	270,400
		Total unrealized appreciation		$431,042

See Notes to Financial Statements

Morgan Stanley Limited Term Municipal Trust

Financial Statements

Statement of Assets and Liabilities

September 30, 2005 (unaudited)


Assets:
Investments in securities, at value (cost $195,673,129)	$	197,882,706
Cash		80,783
Receivable for:
Shares of beneficial interest sold		2,980,723
Interest		2,783,380
Variation margin		144,530
Investments sold		10,000
Prepaid expenses and other assets		27,754
Total Assets		203,909,876
Liabilities:
Payable for:
Investments purchased		1,911,085
Shares of beneficial interest redeemed		332,628
Investment advisory fee		57,814
Dividends to shareholders		36,408
Administration fee		13,294
Transfer agent fee		1,893
Accrued expenses and other payables		84,402
Total Liabilities		2,437,524
Net Assets	$	201,472,352
Composition of Net Assets:			��
Paid-in-capital	$	199,612,580
Net unrealized appreciation		2,640,619
Accumulated undistributed net investment income		1,871
Accumulated net realized loss		(782,718	)
Net Assets	$	201,472,352
Net Asset Value Per Share,
18,472,246 shares outstanding (unlimited shares authorized of $.01 par value)	$	10.91

See Notes to Financial Statements

Morgan Stanley Limited Term Municipal Trust

Financial Statements continued

Statement of Operations

For the six months ended September 30, 2005 (unaudited)


Net Investment Income:
Interest Income	$	3,912,661
Expenses
Investment advisory fee		426,932
Administration fee		81,320
Transfer agent fees and expenses		79,887
Professional fees		31,072
Shareholder reports and notices		23,583
Registration fees		10,373
Custodian fees		5,758
Trustees' fees and expenses		3,988
Other		12,813
Total Expenses		675,726
Less: amounts waived		(44,447	)
Less: expense offset		(5,471	)
Net Expenses		625,808
Net Investment Income		3,286,853
Net Realized and Unrealized Gain (Loss):
Net Realized Gain (Loss) on:
Investments		506,603
Futures contracts		(53,940	)
Net Realized Gain		452,663
Net Change in Unrealized Appreciation/Depreciation on:
Investments		1,590,760
Futures contracts		(119,144	)
Net Appreciation		1,471,616
Net Gain		1,924,279
Net Increase	$	5,211,132

See Notes to Financial Statements

Morgan Stanley Limited Term Municipal Trust

Financial Statements continued

Statement of Changes in Net Assets


	FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2005			FOR THE YEAR ENDED MARCH 31, 2005
	(unaudited)
Increase (Decrease) in Net Assets:
Operations:
Net investment income	$	3,286,853		$	6,142,606
Net realized gain (loss)		452,663			(1,627,573	)
Net change in unrealized appreciation		1,471,616			(3,191,668	)
Net Increase		5,211,132			1,323,365
Dividends to shareholders from net investment income		(3,286,309	)		(6,142,346	)
Net increase (decrease) from transactions in shares of beneficial interest		(1,794,329	)		27,884
Net Increase (Decrease)		130,494			(4,791,097	)
Net Assets:
Beginning of period		201,341,858			206,132,955
End of Period (Including accumulated undistributed net investment income of $1,871 and $1,327, respectively)	$	201,472,352		$	201,341,858

See Notes to Financial Statements

Morgan Stanley Limited Term Municipal Trust

Notes to Financial Statements September 30, 2005 (unaudited)

1. Organization and Accounting Policies

Morgan Stanley Limited Term Municipal Trust (the "Fund") is registered under the Investment Company Act of 1940, as amended, as a diversified, open-end management investment company. The Fund's investment objective is to provide a high level of current income which is exempt from federal income tax, consistent with the preservation of capital and prescribed standards of quality and maturity. The Fund was organized as a Massachusetts business trust on February 25, 1993 and commenced operations on July 12, 1993.

Effective August 29, 2005, the Board of Trustees of the Fund approved the implementation of a 2% redemption fee, which is paid directly to the Fund, for shares redeemed within seven days of purchase. The redemption fee is designed to protect the Fund and its remaining shareholders from the effects of short-term trading.

The following is a summary of significant accounting policies:

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

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

C. Futures Contracts — A futures contract is an agreement between two parties to buy and sell financial instruments or contracts based on financial indices at a set price on a future date. Upon entering into such a contract, the Fund is required to pledge to the broker cash, U.S. Government securities or other liquid

Morgan Stanley Limited Term Municipal Trust

Notes to Financial Statements September 30, 2005 (unaudited) continued

portfolio securities equal to the minimum initial margin requirements of the applicable futures exchange. Pursuant to the contract, the Fund agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in the value of the contract. Such receipts or payments known as variation margin are recorded by the Fund as unrealized gains and losses. Upon closing of the contract, the Fund realizes a gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed.

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

E. Dividends and Distributions to Shareholders — Dividends and distributions to shareholders are recorded on the ex-dividend date.

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

2. Investment Advisory/Administration Agreements

Pursuant to an Investment Advisory Agreement, the Fund pays the Investment Adviser an advisory fee, accrued daily and payable monthly, by applying the annual rate of 0.42% to the net assets of the Fund determined as of the close of each business day.

Pursuant to an Administration Agreement with Morgan Stanley Services Company Inc. (the "Administrator"), an affiliate of the Investment Adviser, the Fund pays an administration fee, accrued daily and payable monthly, by applying the annual rate of 0.08% to the Fund's daily net assets.

Effective June 1, 2005, the Investment Adviser has agreed to cap the Fund's operating expenses (except for brokerage and 12b-1 fees) by assuming the Fund's "other expenses" and/or waiving the Fund's advisory fees, and the Administrator has agreed to waive the Fund's administrative fees, to the extent such operating expenses exceed 0.60% of the average daily net assets of the Fund on an annualized basis. These voluntary assumptions/waivers may be discontinued at any time.

3. Security Transactions and Transactions with Affiliates

The cost of purchases and proceeds from sales of portfolio securities, excluding short-term investments, for the six months ended September 30, 2005 aggregated $34,172,030 and $37,785,158, respectively.

Morgan Stanley Trust, an affiliate of the Investment Adviser and Administrator, is the Fund's transfer agent.

The Fund has an unfunded noncontributory defined benefit pension plan covering certain independent Trustees of the Fund who will have served as independent Trustees for at least five years at the time of retirement.

Morgan Stanley Limited Term Municipal Trust

Notes to Financial Statements September 30, 2005 (unaudited) continued

Benefits under this plan are based on factors which include years of service and compensation. The Trustees voted to close the plan to new participants and eliminate the future benefits growth due to increases to compensation after July 31, 2003. Aggregate pension costs for the six months ended September 30, 2005 included in Trustees' fees and expenses in the Statement of Operations amounted to $2,811. At September 30, 2005, the Fund had an accrued pension liability of $49,462 which is included in accrued expenses in the Statement of Assets and Liabilities.

The Fund has an unfunded Deferred Compensation Plan (the "Compensation Plan") which allows each independent Trustee to defer payment of all, or a portion, of the fees he receives for serving on the Board of Trustees. Each eligible Trustee generally may elect to have the deferred amounts credited with a return equal to the total return on one or more of the Morgan Stanley funds that are offered as investment options under the Compensation Plan. Appreciation/depreciation and distributions received from these investments are recorded with an offsetting increase/decrease in the deferred compensation obligation and do not affect the net asset value of the Fund.

4. Shares of Beneficial Interest

Transactions in shares of beneficial interest were as follows:


	FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2005						FOR THE YEAR ENDED MARCH 31, 2005
	(unaudited)
	SHARES			AMOUNT			SHARES			AMOUNT
Sold		2,279,246		$	24,939,088			5,478,741		$	59,735,434
Reinvestment of dividends		214,479			2,348,833			393,520			4,287,109
		2,493,725			27,287,921			5,872,261			64,022,543
Redeemed		(2,658,126	)		(29,082,250	)		(5,883,147	)		(63,994,659	)
Net increase (decrease)		(164,401	)	$	(1,794,329	)		(10,886	)	$	27,884

5. Federal Income Tax Status

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

At March 31, 2005, the Fund had a net capital loss carryforward of $685,193 which will expire on March 31, 2013 to offset future capital gains to the extent provided by regulations.

Morgan Stanley Limited Term Municipal Trust

Notes to Financial Statements September 30, 2005 (unaudited) continued

As of March 31, 2005, the Fund had temporary book/tax differences primarily attributable to book amortization of discounts on debt securities, mark-to-market of open futures contracts, and dividend payable.

6. Expense Offset

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

7. Risks Relating to Certain Financial Instruments

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

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

These futures contracts involve elements of market risk in excess of the amount reflected in the Statement of Assets and Liabilities. The Fund bears the risk of an unfavorable change in the value of the underlying securities. Risks may also arise upon entering into these contracts from the potential inability of the counterparties to meet the terms of their contracts.

8. Legal Matters

The Investment Adviser, certain affiliates of the Investment Adviser, certain officers of such affiliates and certain investment companies advised by the Investment Adviser or its affiliates, including the Fund, are named as defendants in a consolidated class action. This consolidated action also names as defendants certain individual Trustees and Directors of the Morgan Stanley funds. The consolidated amended complaint, filed in the United States District Court Southern District of New York on April 16, 2004, generally alleges that defendants, including the Fund, violated their statutory disclosure obligations and fiduciary duties by failing properly to disclose (i) that the Investment Adviser and certain affiliates of the Investment Adviser allegedly offered economic incentives to brokers and others to recommend the funds advised by the Investment Adviser or its affiliates to investors rather than funds managed by other companies, and (ii) that the funds advised by the Investment Adviser or its affiliates, including the Fund, allegedly paid excessive commissions to brokers in return for their efforts to recommend these funds to investors. The complaint seeks, among other things, unspecified compensatory damages, rescissionary damages, fees and costs. The defendants have moved to dismiss the action and intend to otherwise vigorously defend it. On March 9, 2005, Plaintiffs sought leave to supplement their complaint to assert claims on behalf of other investors. While the Fund and Adviser believe that each has meritorious defenses, the ultimate outcome of this matter is not presently determinable at this early stage of the litigation, and no provision has been made in the Fund's financial statements for the effect, if any, of this matter.

Morgan Stanley Limited Term Municipal Trust

Financial Highlights

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


	FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2005			FOR THE YEAR ENDED MARCH 31,
	FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2005			2005			2004			2003			2002			2001
	(unaudited)
Selected Per Share Data:
Net asset value, beginning of period	$	10.80		$	11.05		$	10.96		$	10.30		$	10.37		$	9.96
Income (loss) from investment operations:
Net investment income		0.18			0.34			0.33			0.34			0.36			0.38
Net realized and unrealized gain (loss)		0.11			(0.25	)		0.09			0.66			(0.07	)		0.41
Total income from investment operations		0.29			0.09			0.42			1.00			0.29			0.79
Less dividends from net investment income		(0.18	)		(0.34	)		(0.33	)		(0.34	)		(0.36	)		(0.38	)
Net asset value, end of period	$	10.91		$	10.80		$	11.05		$	10.96		$	10.30		$	10.37
Total Return†		2.67	% ⁽¹⁾		0.81	%		3.90	%		9.81	%		2.82	%		8.14	%
Ratios to Average Net Assets:
Expenses		0.62	% ^(2)(3)(4)		0.68	% ⁽³⁾		0.68	% ⁽³⁾		0.70	% ⁽³⁾		0.82	% ⁽³⁾		0.88	% ⁽³⁾
Net investment income		3.23	% ⁽²⁾⁽⁴⁾		3.09	%		2.97	%		3.08	%		3.45	%		3.78	%
Supplemental Data:
Net assets, end of period, in thousands		$201,472			$201,342			$206,133			$143,939			$70,934			$55,138
Portfolio turnover rate		17	% ⁽¹⁾		32	%		46	%		31	%		45	%		24	%

†

Calculated based on the net asset value as of the last business day of the period.

(1)

Not annualized.

(2)

Annualized.

(3)

Does not reflect the effect of expense offset of 0.01%.

(4)

If the Investment Adviser and Administrator had not "capped" all expenses (except for distribution fees) at 0.60% of its daily net assets for the period
June 1, 2005 through September 30, 2005, the annualized expense and net investment income ratios would have been 0.66% and 3.19%, respectively.

See Notes to Financial Statements


Trustees Michael Bozic Charles A. Fiumefreddo Edwin J. Garn Wayne E. Hedien James F. Higgins Dr. Manuel H. Johnson Joseph J. Kearns Michael E. Nugent Fergus Reid Officers Charles A. Fiumefreddo Chairman of the Board Ronald E. Robison President and Principal Executive Officer Joseph J. McAlinden Vice President Barry Fink Vice President and General Counsel Amy R. Doberman Vice President Carsten Otto Chief Compliance Officer Stefanie V. Chang Vice President Francis J. Smith Treasurer and Chief Financial Officer Thomas F. Caloia Vice President Mary E. Mullin Secretary Transfer Agent Morgan Stanley Trust Harborside Financial Center, Plaza Two Jersey City, New Jersey 07311 Independent Registered Public Accounting Firm Deloitte & Touche LLP Two World Financial Center New York, New York 10281 Investment Adviser Morgan Stanley Investment Advisors Inc. 1221 Avenue of the Americas New York, New York 10020 The financial statements included herein have been taken from the records of the Fund without examination by the independent auditors and accordingly they do not express an opinion thereon. This report is submitted for the general information of the shareholders of the Fund. For more detailed information about the Fund, its fees and expenses and other pertinent information, please read its Prospectus. The Fund's Statement of Additional Information contains additional information about the Fund, including its trustees. It is available, without charge, by calling (800) 869-NEWS. This report is not authorized for distribution to prospective investors in the Fund unless preceded or accompanied by an effective Prospectus. Read the Prospectus carefully before investing. Investments and services offered through Morgan Stanley DW Inc., member SIPC. Morgan Stanley Distributors Inc., member NASD. © 2005 Morgan Stanley 37993RPT-RA05-00931P-Y09/05		MORGAN STANLEY FUNDS
		Morgan Stanley Limited Term Municipal Trust Semiannual Report September 30, 2005




Item 2.  Code of Ethics.

Not applicable for semiannual reports.


Item 3.  Audit Committee Financial Expert.

Not applicable for semiannual reports.


Item 4. Principal Accountant Fees and Services

Not applicable for semiannual reports.


Item 5. Audit Committee of Listed Registrants.

Not applicable for semiannual reports.


Item 6.

Refer to Item 1.


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

Not applicable for semiannual reports.


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

Applicable only to reports filed by closed-end funds.


Item 9. Closed-End Fund Repurchases

Applicable to reports filed by closed-end funds.


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

Not applicable.



Item 11. Controls and Procedures

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

(b) There were no changes in the registrant's internal control over financial
reporting that occurred during the registrant's most recent fiscal half-year
(the registrant's second fiscal half-year in the case of an annual report) that
has materially affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting.

Item 12. Exhibits

(a) Code of Ethics - Not applicable for semiannual reports.

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















                                       2





                                   SIGNATURES

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

Morgan Stanley Limited Term Municipal Trust

/s/ Ronald E. Robison
Ronald E. Robison
Principal Executive Officer
November 21, 2005

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

/s/ Ronald E. Robison
Ronald E. Robison
Principal Executive Officer
November 21, 2005

/s/ Francis Smith
Francis Smith
Principal Financial Officer
November 21, 2005


















                                       3




                                                                  EXHIBIT 12 B1

                  CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

                                 CERTIFICATIONS

I, Ronald E. Robison, certify that:

1.   I have reviewed this report on Form N-CSR of Morgan Stanley Limited Term
     Municipal Trust;

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

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

4.   The registrant's other certifying officers and I are responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in Rule 30a-3(c) under the Investment Company Act of 1940) and internal
     control over financial reporting (as defined in Rule 30a-3(d) under the
     Investment Company Act of 1940) for the registrant and have:

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

b)   designed such internal control over financial reporting, or caused such
     internal control over financial reporting to be designed under our
     supervision, to provide reasonable assurance regarding the reliability of
     financial reporting and the preparation of financial statements for
     external purposes in accordance with generally accepted accounting
     principles;

c)   evaluated the effectiveness of the registrant's disclosure controls and
     procedures and presented in this report our conclusions about the
     effectiveness of the disclosure controls and procedures, as of a date
     within 90 days prior to the filing date of this report based on such
     evaluation; and

d)   disclosed in this report any change in the registrant's internal control
     over financial reporting that occurred during the registrant's most recent
     fiscal half-year (the registrant's second fiscal half-year in the case of
     an annual report) that has materially affected, or is reasonably likely to
     materially affect, the registrant's internal control over financial
     reporting; and

5.   The registrant's other certifying officer(s) and I have disclosed to the
     registrant's auditors and the audit committee of the registrant's board of
     directors (or persons performing the equivalent functions):


                                       4




a)   all significant deficiencies and material weaknesses in the design or
     operation of internal control over financial reporting which are reasonably
     likely to adversely affect the registrant's ability to record, process,
     summarize, and report financial information; and

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

Date: November 21, 2005
                                                    /s/ Ronald E. Robison
                                                    Ronald E. Robison
                                                    Principal Executive Officer




















                                       5




                                                                  EXHIBIT 12 B2

                  CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

                                 CERTIFICATIONS

I, Francis Smith, certify that:

1.   I have reviewed this report on Form N-CSR of Morgan Stanley Limited Term
     Municipal Trust;

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

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

4.   The registrant's other certifying officers and I are responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in Rule 30a-3(c) under the Investment Company Act of 1940) and internal
     control over financial reporting (as defined in Rule 30a-3(d) under the
     Investment Company Act of 1940) for the registrant and have:

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

b)   designed such internal control over financial reporting, or caused such
     internal control over financial reporting to be designed under our
     supervision, to provide reasonable assurance regarding the reliability of
     financial reporting and the preparation of financial statements for
     external purposes in accordance with generally accepted accounting
     principles;

c)   evaluated the effectiveness of the registrant's disclosure controls and
     procedures and presented in this report our conclusions about the
     effectiveness of the disclosure controls and procedures, as of a date
     within 90 days prior to the filing date of this report based on such
     evaluation; and

d)   disclosed in this report any change in the registrant's internal control
     over financial reporting that occurred during the registrant's most recent
     fiscal half-year (the registrant's second fiscal half-year in the case of
     an annual report) that has materially affected, or is reasonably likely to
     materially affect, the registrant's internal control over financial
     reporting; and

5.   The registrant's other certifying officer(s) and I have disclosed to the
     registrant's auditors and the audit committee of the registrant's board of
     directors (or persons performing the equivalent functions):


                                       6



a)   all significant deficiencies and material weaknesses in the design or
     operation of internal control over financial reporting which are reasonably
     likely to adversely affect the registrant's ability to record, process,
     summarize, and report financial information; and

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

Date: November 21, 2005
                                                    /s/ Francis Smith
                                                    Francis Smith
                                                    Principal Financial Officer




















                                       7





                            SECTION 906 CERTIFICATION

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

Morgan Stanley Limited Term Municipal Trust

         In connection with the Report on Form N-CSR (the "Report") of the
above-named issuer for the period ended September 30, 2005 that is accompanied
by this certification, the undersigned hereby certifies that:

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

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



Date: November 21, 2005                             /s/ Ronald E. Robison
                                                    ---------------------------
                                                    Ronald E. Robison
                                                    Principal Executive Officer


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














                                       8



                            SECTION 906 CERTIFICATION

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

Morgan Stanley Limited Term Municipal Trust

         In connection with the Report on Form N-CSR (the "Report") of the
above-named issuer for the period ended September 30, 2005 that is accompanied
by this certification, the undersigned hereby certifies that:

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

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



Date: November 21, 2005                             /s/ Francis Smith
                                                    ----------------------
                                                    Francis Smith
                                                    Principal Financial Officer


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
















                                       9

Morgan Stanley LTD Term Municipal Trust Inactive N-CSRSCertified semi-annual shareholder report (management investment company)