SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. ___)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
FUNDAMENTAL INVESTORS, INC>
- ------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- ------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
---------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
---------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
---------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
---------------------------------------------------------------------------
(5) Total fee paid:
---------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
---------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
---------------------------------------------------------------------------
(3) Filing Party:
---------------------------------------------------------------------------
(4) Date Filed:
---------------------------------------------------------------------------
Notes:

FUNDAMENTAL INVESTORS, INC.

----------------

NOTICE OF MEETING OF SHAREHOLDERS

FEBRUARY 26, 1998

----------------

To the Shareholders of
Fundamental Investors, Inc.:

A Meeting of Shareholders of Fundamental Investors, Inc. (the "Fund") will
be held at the offices of Capital Research and Management Company, 333 South
Hope Street, 55th Floor, Los Angeles, California, on Thursday, February 26,
1998 at 10:00 A.M., local time, to consider and vote on the following matters
described under the corresponding numbers in the accompanying Proxy Statement:

(1) election of a board of twelve directors;

(2) ratification of the selection, by the Board of Directors of
Deloitte & Touche LLP as independent accountant for the Fund for
the year ending December 31, 1998; and

(3) such other matters as may properly come before the meeting.

The Board of Directors has fixed January 5, 1998, at the close of business,
as the record date for the determination of shareholders entitled to notice of
and to vote at the meeting.

THE PROPOSED BUSINESS CANNOT BE CONDUCTED AT THE MEETING UNLESS THE HOLDERS
OF A MAJORITY OF THE SHARES OF THE FUND OUTSTANDING ON THE RECORD DATE ARE
PRESENT IN PERSON OR BY PROXY. THEREFORE, PLEASE MARK, DATE, SIGN AND RETURN
THE ENCLOSED PROXY, WHICH IS SOLICITED BY THE BOARD OF DIRECTORS. THE PROXY IS
REVOCABLE AND WILL NOT AFFECT YOUR RIGHT TO VOTE IN PERSON IN THE EVENT THAT
YOU ATTEND THE MEETING.

By Order of the Board of
Directors,

Julie F. Williams
Secretary

January 13, 1998

IMPORTANT

SHAREHOLDERS CAN HELP THE FUND AVOID THE NECESSITY AND EXPENSE OF
SENDING FOLLOW-UP LETTERS TO ENSURE A QUORUM BY PROMPTLY RETURNING THE
ENCLOSED PROXY. PLEASE MARK, DATE, SIGN AND RETURN THE ENCLOSED PROXY IN
ORDER THAT THE NECESSARY QUORUM MAY BE REPRESENTED AT THE MEETING. THE
ENCLOSED ENVELOPE REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.

FUNDAMENTAL INVESTORS, INC.
ONE MARKET, STEUART TOWER
SUITE 1800, SAN FRANCISCO, CALIFORNIA 94105

--------------
PROXY STATEMENT
MEETING OF SHAREHOLDERS -- FEBRUARY 26, 1998
--------------

The enclosed Proxy is solicited by the Board of Directors of the Fund in
connection with the Meeting of Shareholders to be held on Thursday, February
26, 1998. Every Proxy returned in time to be voted at the meeting will be
voted and, if a specification is made with respect to any proposal, the Proxy
will be voted accordingly. If no specification is made, the Proxy will be
voted in favor of the proposal. Anyone having submitted a Proxy may revoke it
prior to its exercise, either by filing with the Fund a written notice of
revocation, by delivering a duly executed Proxy bearing a later date, or by
attending the meeting and voting in person. This Proxy was first mailed to
shareholders on or about January 13, 1998.

At the close of business on January 5, 1998, the record date fixed by the
Board of Directors for the determination of shareholders entitled to notice of
and to vote at the meeting, there were outstanding 382,112,975 shares of
capital stock, $1 par value, the only authorized class of securities of the
Fund (the "Shares"). Each Share is entitled to one vote. There is no provision
for cumulative voting. No person owned of record or was known by the Fund to
own beneficially 5% or more of the outstanding Shares of the Fund.

With respect to the election of directors (Item 1), the 12 nominees
receiving the highest number of votes shall be deemed to be elected. The vote
required to approve item 2 is the affirmative vote of the lesser of (a) 67% or
more of all Shares present and entitled to vote at the meeting, provided the
holders of more than 50% of all outstanding Shares are present or represented
by proxy, or (b) more than 50% of all outstanding Shares on the record date.

In the event that sufficient votes are not received by the meeting date, a
person named as proxy may propose one or more adjournments of the meeting for
a period or periods of not more than 120 days in the aggregate to permit
further solicitation of Proxies. The persons named as proxies may vote all
Proxies in favor of such adjournment. Signed but unmarked Proxies will be
voted for the below nominated directors and in favor of all proposals.
Shareholders who return Proxies marked as abstaining from voting on one or
more proposals are treated as being present at the meeting for purposes of
obtaining the quorum necessary to hold the meeting, but are not counted as
part of the vote necessary to approve the proposals. Where brokers holding
Fund shares for their customers in Street Name have not received instructions
and are not authorized to vote without instruction, those shares also will be
treated as abstentions.

1.ELECTION OF DIRECTORS

Mutual fund complexes, which consist of a number of funds sharing the same
investment adviser, administrator and/or principal underwriter, follow varying
practices in organizing the fund boards for corporate governance. Industry
practices range from having a single set of directors serving as the board for
every fund in the complex (and meeting for all funds simultaneously) to having
entirely distinct board membership and separate board meetings for each fund
in the complex. The American Funds Group, of which the Fund is a part,
generally follows a middle course between those two extremes -- several, but
not all, the funds share common board members who meet simultaneously as the
boards of those funds. These common fund boards are referred to herein as
"board clusters."

Six equity and balanced funds in The American Funds Group, including the
Fund, propose to realign their board clusters through election of certain new
directors to each board. In some cases directors will resign from the board of
a fund (or not stand for re-election by shareholders) in order to become
affiliated with a different board cluster. The funds involved are: AMCAP Fund,
Inc. ("AMCAP"), American Mutual Fund, Inc. ("AMF"), American Balanced Fund,
Inc. ("AMBAL"), Fundamental Investors, Inc. ("FI" or "the Fund"), The Growth
Fund of America, Inc. ("GFA"), and The Income Fund of America, Inc. ("IFA").
Currently, the AMF board meets as a single fund board, AMCAP and FI form a
two-fund board cluster and AMBAL, GFA and IFA form a three-fund board cluster.
The proposed realignment would create three new two-fund clusters: AMCAP and
AMF; FI and GFA; and AMBAL and IFA.

Based on their experience with corporate governance in these six funds, the
funds' officers recommended the proposed realignment of the board clusters for
two principal reasons. First, the officers have found that, for these funds,
two-fund board clusters provide the most effective structure for board
oversight of investment results and operations at regular board meetings. This
is due, among other things, to the number of investment professionals involved
with each fund through the investment adviser's multiple portfolio counselor
system, in which several portfolio counselors individually manage a portion of
the fund's assets and the research analysts as a group also manage a portion.
The proposal would permit the AMF board to meet as part of a two-fund cluster
(with AMCAP) rather than as a single fund, and it would reduce the present
three-fund cluster (AMBAL, GFA and IFA) to a two-fund cluster (AMBAL and IFA).
Second, the investment professionals primarily responsible for the management
of each fund's assets generally belong to a particular investment unit of
Capital Research and Management Company ("CRMC"), the funds' investment
adviser. The funds' officers believe that board oversight will be enhanced if,
wherever practicable, there is substantial overlap of board membership across
funds served principally by a particular CRMC investment unit. The proposed
board clusters reflect this consideration.

Upon the recommendation of the Nominating Committee of the Board of
Directors of the Fund, the board voted unanimously to recommend that the 12
persons listed below be elected directors of the Fund at the meeting of
shareholders. If elected, each is to hold office until a successor is elected
and qualified. Because it is not anticipated that a meeting of shareholders
will be held each year, a director's term will be indefinite in length. Five
of the nominees for director -- Guilford C. Babcock, Charles H. Black, Gail L.
Neale, James W. Ratzlaff and Henry E. Riggs -- currently serve as directors of
the Fund and were elected by the shareholders at a meeting of shareholders
held on November 14, 1991. Charles Wolf, Jr., a director of the Fund since
1991, is not standing for re-election since he has reached retirement age.

Five nominees -- Robert A. Fox, Roberta L. Hazard, Leonade D. Jones, John G.
McDonald and Patricia K. Woolf -- currently serve as directors of GFA; they
are being proposed as directors of FI in order that they can serve on both
funds in the new FI/GFA cluster. James E. Drasdo, President of the Fund, and
James F. Rothenberg, President of CRMC, are also nominees.

Finally, five other current directors of FI -- Walter P. Stern, Chairman of
the Board, Martin Fenton, Jr., Herbert Hoover III, Kirk P. Pendleton and R.
Michael Shanahan -- are not standing for re-election to the board of the Fund.
(All except Walter P. Stern will continue to serve as directors of AMCAP and
will meet as part of the AMCAP and AMF cluster.)

Each of the nominees has agreed to serve as director if elected. If due to
presently unforeseen circumstances, any nominee should not be available for
election, the persons named as proxies will vote the signed but unmarked
Proxies and those marked for the nominated directors for such other nominee as
the present directors may recommend. The table below sets forth certain
information regarding the nominees.

SHARES
MEMBERSHIPS ON BENEFICIALLY
CURRENT PRINCIPAL YEAR THE BOARD(S) OF OTHER OWNED, DIRECTLY
NAME OF NOMINEE OCCUPATION AND FIRST REGISTERED INVESTMENT OR
(POSITION WITH FUND) PRINCIPAL EMPLOYMENT ELECTED A COMPANIES AND PUBLICLY INDIRECTLY, AT
AND AGE DURING PAST FIVE YEARS # DIRECTOR HELD COMPANIES JANUARY 5, 1998

Guilford C. Babcock /2/ /3/ Associate Professor of 1991 The American Funds Group: 1,760
(Director) Finance, Marshall School AMCAP Fund
66 of Business, University
of Southern California

Charles H. Black /2/ /3/ Private investor and 1978 The American Funds Group: 5,347
(Director) consultant; former AMCAP Fund
71 Executive Vice President The Investment Company of
and Director, Kaiser America
Steel Corporation American Variable Insurance
Series
JMC Group, Inc.
Pacific Stock Exchange
(Public Governor)
Wilshire Technologies, Inc.

James E. Drasdo* Senior Vice President Nominee 5,311++
(President and and Director, Capital
Director Nominee) Research and Management
52 Company

Robert A. Fox President and Chief Nominee The American Funds Group: 25,832
(Director Nominee) Executive Officer, American Balanced Fund
60 Foster Farms EuroPacific Growth Fund
The Growth Fund of America
The Income Fund of America
New Perspective Fund

Crompton & Knowles Corporation

Roberta L. Hazard Private investor Nominee The American Funds Group: 73
(Director Nominee) American Balanced Fund
63 The Growth Fund of America
The Income Fund of America

Leonade D. Jones Former Treasurer, The Nominee The American Funds Group: 364
(Director Nominee) Washington Post Company American Balanced Fund
50 The Growth Fund of America
The Income Fund of America
The New Economy Fund
SMALLCAP World Fund

John G. McDonald The IBJ Professor of Nominee The American Funds Group: 146
(Director Nominee) Finance, Graduate School American Balanced Fund
60 of Business, Stanford EuroPacific Growth Fund
University The Growth Fund of America
The Investment Company of America
The Income Fund of America
New Perspective Fund
Emerging Markets Growth Fund
Scholastic Corporation
Varian Associates, Inc.
Trinet Corp.

SHARES
MEMBERSHIPS ON BENEFICIALLY
CURRENT PRINCIPAL YEAR THE BOARD(S) OF OTHER OWNED, DIRECTLY
NAME OF NOMINEE OCCUPATION AND FIRST REGISTERED INVESTMENT OR
(POSITION WITH FUND) AND PRINCIPAL EMPLOYMENT ELECTED A COMPANIES AND PUBLICLY INDIRECTLY, AT
AGE DURING PAST FIVE YEARS # DIRECTOR HELD COMPANIES JANUARY 5, 1998

Gail L. Neale /1/ /2/ /3/ President, The Lovejoy 1985 The American Funds Group: 143
(Director) Consulting Group, Inc.; AMCAP Fund
62 former Executive Vice Capital Income Builder
President, Salzburg Capital World Growth and Income
Seminar Fund

James W. Ratzlaff* Senior Partner, The 1982 The American Funds Group: 14,714++
(Director) Capital Group Partners, AMCAP Fund
61 L.P.; former Vice American Balanced Fund
Chairman of the Board, American Mutual Fund
Capital Research and The Growth Fund of America
Management Company The Investment Company of America
The Income Fund of America
New Perspective Fund

Henry E. Riggs /2/ /3/ President, Keck Graduate 1989 The American Fund Group: 23,849
(Director) Institute of Applied AMCAP Fund
62 Life Sciences at American Balanced Fund
Claremont; former The Growth Fund of America
President and Professor The Income Fund of America
of Engineering, Harvey
Mudd College; former
Thomas W. Ford Professor
of Engineering and Vice
President of International Technology Corporation
Development, Stanford
University

James F. Rothenberg* President and Director, Nominee The American Funds Group: 11,090++
(Director Nominee) Capital Research and The Growth Fund of America
51 Management Company American Variable Insurance Series

Patricia K. Woolf Private investor; Nominee The American Funds Group: 364
(Director Nominee) lecturer, Department of American Balanced Fund
63 Molecular Biology, The Growth Fund of America
Princeton University The Income Fund of America
The New Economy Fund
SMALLCAP World Fund
General Public Utilities Corporation
Crompton & Knowles Corporation

- --------------------
The American Funds Group consists of 28 funds: AMCAP Fund, Inc., American
Balanced Fund, Inc., American High-Income Municipal Bond Fund, Inc.,
American High-Income Trust, American Mutual Fund, Inc., The Bond Fund of
America, Inc., The Cash Management Trust of America, Capital Income
Builder, Inc., Capital World Growth and Income Fund, Inc., Capital World
Bond Fund, Inc., EuroPacific Growth Fund, Fundamental Investors, Inc., The
Growth Fund of America, Inc., The Income Fund of America, Inc.,
Intermediate Bond Fund of America, The Investment Company of America,
Limited Term Tax-Exempt Bond Fund of America, The New Economy Fund, New
Perspective Fund, Inc., SMALLCAP World Fund, Inc., The Tax-Exempt Bond Fund
of America, Inc., The Tax-Exempt Fund of California, The Tax-Exempt Fund of
Maryland, The Tax-Exempt Fund of Virginia, The Tax-Exempt Money Fund of
America, The U.S. Treasury Money Fund of America, U.S. Government
Securities Fund and Washington Mutual Investors Fund, Inc., managed by
Capital Research and Management Company. Capital Research and Management
Company also manages American Variable Insurance Series which serves as the
underlying investment vehicle for certain variable insurance contracts and
Bond Portfolio for Endowments, Inc. and Endowment, Inc. whose shares may be
owned only by tax-exempt organizations.
* Is considered an "interested person" of the Fund within the meaning of the
Investment Company Act of 1940 (the "1940 Act"), on the basis of his
affiliation with Capital Research and Management Company (the "Investment
Adviser").
++ Includes shares beneficially held under a master retirement plan.
# Corporate positions, in some instances, may have changed during this
period.
/1/ The Fund has an Audit Committee composed of the above-designated directors.
The function of the Committee includes such specific matters as
recommending the independent accountant to the Board of Directors,
reviewing the audit plan and results of the audits and considering other
matters deemed appropriate for consideration by the Board of Directors
and/or the Committee.

/2/ The Fund has a Nominating Committee which is composed of the above-
designated directors. The Committee's functions include selecting and
recommending to the Board of Directors nominees for election as directors of
the Fund. (Pursuant to rule 12b-1, the selection and nomination of directors
who are not "interested persons" of the Fund must be committee to the
discretion of the non-interested directors then in office.) While the
Committee normally is able to identify from its own resources an ample
number of qualified candidates, it will consider shareholder suggestions of
persons to be considered as nominees to fill future vacancies on the board.
Such suggestions must be sent in writing to the Nominating Committee of the
Fund, c/o the Fund's Secretary, and must be accompanied by complete
biographical and occupational data on the prospective nominee, along with a
written consent of the prospective nominee to consideration of his or her
name by the Committee. See also "Shareholder Proposals."

/3/ The Fund has a Contracts Committee which is composed of all directors who
are not considered to be "interested persons" of the Fund within the meaning
of the 1940 Act. The Contracts Committee's function is to request, review
and consider the information deemed necessary to evaluate the terms of the
investment advisory and principal underwriting agreements and the Plan of
Distribution under rule 12b-1 that the Fund proposed to enter into, renew or
continue prior to voting thereon, and to make its recommendations to the
full Board of Directors on these matters.

Each director is paid a fee of $11,000 per annum plus $800 for each Board of
Directors meeting attended and $400 for each meeting attended as a member of a
committee of the Board of Directors.

There were four Board of Directors, two Audit Committee, two Nominating
Committee, and one Contracts Committee meeting during the year ended December
31, 1997. All incumbent directors attended all Board meetings and meetings of
the committees of which they were members.

The Fund pays no salaries or other compensation to its directors other than
directors' fees, which are paid to those directors who are unaffiliated with
the Investment Adviser as described on the following page.

DIRECTOR COMPENSATION

TOTAL COMPENSATION
(INCLUDING VOLUNTARILY
AGGREGATE COMPENSATION DEFERRED COMPENSATION)
(INCLUDING VOLUNTARILY FROM ALL FUNDS MANAGED TOTAL NUMBER
DEFERRED COMPENSATION/1/) BY CAPITAL RESEARCH AND OF FUND BOARDS
FROM THE FUND MANAGEMENT COMPANY ON WHICH
DURING FISCAL DURING THE FISCAL DIRECTOR
DIRECTOR OR NOMINEE YEAR ENDED 12/31/97 YEAR ENDED 12/31/97 SERVES/2/

Guilford C. Babcock..... $16,400(deferred)/4/ $ 81,600(deferred) 2
Charles H. Black........ 15,900 122,300 4
James E. Drasdo......... none/5/ none/5/ none
Robert A. Fox........... none/3/ 89,050(deferred) 5
Roberta L. Hazard....... none/3/ 50,000 3
Leonade D. Jones........ none/3/ 62,000(deferred) 5
John G. McDonald........ none/3/ 163,400(deferred) 6
Gail L. Neale........... 11,200/4/ 57,300 4
James W. Ratzlaff....... none/5/ none/5/ 8
Henry E. Riggs.......... 16,600(deferred)/4/ 90,350(deferred) 5
James F. Rothenberg..... none/5/ none/5/ 2
Patricia K. Woolf....... none/3/ 91,450 5

- ---------------------
/1/ Amounts may be deferred by eligible directors under a non-qualified deferred
compensation plan adopted by the Fund in 1993. Deferred amounts accumulate
at an earnings rate determined by the total return of one or more funds in
The American Funds Group as designated by the director.
/2/ Includes funds managed by Capital Research and Management Company and
affiliates.
/3/ Robert A. Fox, Roberta L. Hazard, Leonade D. Jones, John G. McDonald and
Patricia K. Woolf have been nominated as directors of the Fund and as such
have not received any remuneration from the Fund as of this time.
/4/ Since the plan's adoption, the total amount of deferred compensation accrued
by the Fund (plus earnings thereon) for participating directors is as
follows: Guilford C. Babcock ($77,322), Gail L. Neale ($49,425) and Henry E.
Riggs ($84,635). Amounts deferred and accumulated earnings thereon are not
funded and are general unsecured liabilities of the Fund until paid to the
director.
/5/ James E. Drasdo, James W. Ratzlaff, and James F. Rothenberg are affiliated
with the Fund's Investment Adviser and, accordingly, receive no remuneration
from the Fund.

OTHER EXECUTIVE OFFICERS

NAME OFFICER
(POSITION WITH FUND) CONTINUOUSLY
AND AGE PRINCIPAL OCCUPATION (1) SINCE (2)

Gordon Crawford 50 Capital Research and 1994
(Senior Vice President) Management Company,
Director and Senior Vice
President

Paul G. Haaga, Jr. 49 Capital Research and 1994
(Senior Vice President) Management Company,
Director and Executive Vice
President

Dina N. Perry 52 Capital Research and 1994
(Senior Vice President) Management Company,
Senior Vice President

Michael T. Kerr 38 Capital Research Company, 1995
(Vice President) Director and Executive Vice
President

Julie F. Williams 49 Capital Research and 1984
(Secretary) Management Company,
Vice President -- Fund
Business Management Group

Mary C. Hall 40 Capital Research and 1986
(Treasurer) Management Company,
Senior Vice President -- Fund
Business Management Group

- ---------------------
(1) The occupations shown reflect the principal employment of each individual
during the past five years. Corporate positions, in some instances, may
have changed during this period.

(2) Officers are elected to hold office until their respective successors are
elected, or until they resign or are removed.

NO OFFICER, DIRECTOR OR EMPLOYEE OF THE INVESTMENT ADVISER RECEIVES ANY
REMUNERATION FROM THE FUND. ALL DIRECTORS AND OFFICERS AS A GROUP OWNED
BENEFICIALLY FEWER THAN 1% OF THE SHARES OUTSTANDING ON JANUARY 5, 1998.

2. RATIFICATION OF THE SELECTION BY THE BOARD OF DIRECTORS OF DELOITTE & TOUCHE
LLP AS INDEPENDENT PUBLIC ACCOUNTANT

Shareholders are requested to ratify the selection by the Board of Directors
(including a majority of the directors who are not "interested persons" of the
Fund as that term is defined in the Investment Company Act of 1940 (the "1940
Act")) of the firm of Deloitte & Touche LLP as independent accountant for the
Fund for the fiscal year 1998. In addition to the normal audit services,
Deloitte & Touche LLP provides services in connection with the preparation and
review of federal and state tax returns for the Fund. Deloitte & Touche LLP
has served as the Fund's independent accountant since February 14, 1991 and
has advised the Fund that it has no material direct or indirect financial
interest in the Fund or its affiliates. The Fund's Audit Committee recommended
that Deloitte & Touche LLP be selected as the Fund's independent accountant
for the current fiscal year. The employment of the accountant is conditioned
upon the right of the Fund to terminate such employment forthwith without any
penalty. No representative of the firm of Deloitte & Touche LLP is expected to
attend the Meeting of Shareholders.

THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR RATIFICATION OF ITS
SELECTION OF DELOITTE & TOUCHE LLP.

OTHER MATTERS

Neither the persons named in the enclosed Proxy nor the Board of Directors
are aware of any matters that will be presented for action at the meeting
other than the matters set forth herein. Should any other matters requiring a
vote of shareholders arise, the proxies in the accompanying form will confer
upon the person or persons entitled to vote the shares represented by such
Proxy a discretionary authority to vote the shares in respect to any such
other matters in accordance with their best judgment in the interest of the
Fund.

SHAREHOLDER PROPOSALS

Any shareholder proposals for inclusion in proxy solicitation material for a
shareholders meeting should be submitted to the Secretary of the Fund, at the
Fund's principal executive offices, One Market, Steuart Tower, Suite 1800, San
Francisco, CA 94105. Any such proposals must comply with the requirements of
rule 14a-8 under the Securities Exchange Act of 1934.

Under the laws of Maryland, where the Fund is incorporated, and the Fund's
Articles of Incorporation and By-Laws, the Fund is not required to hold
regular meetings of shareholders. Under the Investment Company Act of 1940, a
vote of shareholders is required from time to time for particular matters but
not necessarily on an annual basis. As a result, it is not anticipated that
the Fund will hold shareholders meetings on a regular basis, and any
shareholder proposal received may not be considered until such a meeting is
held.

MISCELLANEOUS

Capital Research and Management Company is the investment adviser to the
Fund and is located at 333 South Hope Street, Los Angeles, CA 90071 and 135
South State College Boulevard, Brea, CA 92821. American Funds Distributors,
Inc. is the principal underwriter of the Fund's shares and is located at the
Los Angeles and Brea addresses above and also at 8000 IH-10 West, San Antonio,
TX 78230, 8332 Woodfield Crossing Boulevard, Indianapolis, IN 46240, and
5300 Robin Hood Road, Norfolk, VA 23513.

The solicitation of the enclosed Proxy is made by and on behalf of the Board
of Directors of the Fund. The cost of soliciting proxies, consisting of
printing, handling and mailing of the Proxies and related materials, will be
paid by the Fund. In addition to solicitation by mail, certain officers and
directors of the Fund, who will receive no extra compensation for their
services, may solicit by telephone, telegram or personally.

A COPY OF THE FUND'S MOST RECENT ANNUAL REPORT MAY BE OBTAINED WITHOUT
CHARGE, BY WRITING TO THE SECRETARY OF THE FUND AT ONE MARKET, STEUART TOWER,
SUITE 1800, SAN FRANCISCO, CA 94105, OR BY TELEPHONING 800/421-0280. THESE
REQUESTS WILL BE HONORED WITHIN THREE BUSINESS DAYS OF RECEIPT.

By Order of the Board of
Directors,

Julie F. Williams
Secretary

January 13, 1998

PROXY FUNDAMENTAL INVESTORS, INC.

PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE FUND FOR THE
MEETING OF SHAREHOLDERS TO BE HELD FEBRUARY 26, 1998

The undersigned hereby appoints Paul G. Haaga, Jr., Mary C. Hall and Julie F.
Williams and each of them, his/her true and lawful agents and proxies with full
power of substitution to represent the undersigned at the Meeting of
Shareholders to be held at the offices of Capital Research and Management
Company, 333 S. Hope Street, 55th Floor, Los Angeles, California, 90071 on
Thursday, February 26, 1998 at 10:00 a.m., on all matters coming before the
meeting.

THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER YOU DIRECTED.
IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED FOR THE NOMINEES IN ITEM 1
AND FOR ITEM 2.

Please sign exactly as your name(s) appear on this card. Joint owners should
each sign individually. Corporate proxies should be signed in full corporate
name by an authorized officer. Fiduciaries should give full titles.

--DETACH ALONG PERFORATION AND RETURN IN THE ENVELOPE PROVIDED--

IMPORTANT

SHAREHOLDERS CAN HELP THE COMPANY AVOID THE NECESSITY AND EXPENSE OF SENDING
FOLLOW-UP LETTERS BY PROMPTLY RETURNING THE ENCLOSED PROXY.

- ---------------------------------------------------------------

IMPORTANT INSTRUCTIONS FOR COMPLETING YOUR PROXY VOTE
[AMERICAN FUNDS LOGO(R)]

- - Please fill in the ovals in red or black ink.

- - Sign and date your proxy.

- - Detach proxy and return promptly in the enclosed envelope,
which requires no postage if mailed in the United States.

ADDRESS CORRECTION

If address is not correct as shown, please make correction on this form.
DETACH FROM PROXY and return to American Funds Service Company in the enclosed
envelope.

- ------IMPORTANT - PLEASE DETACH ALONG PERFORATION------------

Fundamental Investors PROXY

1. Election of Directors: // To vote for all nominees // To withhold
your vote from all nominees

- Guilford C. Babcock
- Charles H. Black
- James E. Drasdo
- Robert A. Fox
- Roberta L. Hazard
- Leonade D. Jones
- John G. McDonald
- Gail L. Neale
- James W. Ratzlaff
- Henry E. Riggs
- James F. Rothenberg
- Patricia K. Woolf

To WITHHOLD your vote for any individual nominee, write the nominee's name(s)on
the line below.

Account Number:
Shares owned as of January 5, 1998

- ------------------------------------------------

FOR AGAINST ABSTAIN

2. Ratification of selection of
Deloitte & Touche LLP as independent
accountant: // // //

In their discretion, upon other
matters as may properly come
before the meeting.

SHAREHOLDER(S) PLEASE SIGN HERE

X _______________________ X ________________________
Signed Signed
__________
Date