SCHEDULE 14A
(RULE 14A-101)

INFORMATION REQUIRED IN PROXY STATEMENT

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 sec. 240.14a-11(c) or sec. 240.14a-12

USLIFE INCOME FUND, 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):
[x] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(l) 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:

- --------------------------------------------------------------------------------
2

USLIFE INCOME FUND, INC.

NOTICE OF
ANNUAL MEETING OF SHAREHOLDERS
NOVEMBER 20, 1998

An annual meeting of the shareholders of USLIFE Income Fund, Inc. ("Fund")
will be held in Meeting Room 1 of The Variable Annuity Life Insurance Company,
Plaza Level, The Woodson Tower, 2919 Allen Parkway, Houston, Texas 77019, on
Friday, November 20, 1998 at 10:00 a.m. Central Time for the following purposes:

1. To approve amendments to the Fund's Articles of Incorporation and Bylaws
to require a vote of at least 75% of the Fund's shareholders to approve:
(a) any proposal to convert the Fund from a closed-end investment
company to an open-end investment company; (b) any shareholder proposal
as to specific investment decisions made or to be made regarding the
Fund's assets; and (c) any business combination.

2. To approve amendments to the Fund's Articles of Incorporation and Bylaws
to provide for the establishment of three classes of Directors with each
class having a term of office no greater than three years and with the
term of office for each class expiring in successive calendar years.

3. To elect twelve Directors to hold office until their successors are
elected and qualified.

4. To ratify the selection of KPMG Peat Marwick LLP as independent auditor
of the Fund for the fiscal year ending June 30, 1999.

5. To transact such other business as may properly come before the meeting.

You will be entitled to vote at the meeting if you owned shares of the Fund
at the close of business on October 6, 1998. IF YOU ATTEND THE MEETING, YOU MAY
VOTE YOUR SHARES IN PERSON. IF YOU DO NOT EXPECT TO ATTEND THE MEETING PLEASE
COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY CARD IN THE ENCLOSED
POSTAGE-PAID ENVELOPE BY NOVEMBER 19, 1998. YOUR VOTE IS EXTREMELY IMPORTANT AND
YOUR PROMPT RESPONSE WILL HELP SAVE ADDITIONAL SOLICITATION EXPENSE.

By Order of the Board of Directors

------------------------------------
Peter V. Tuters
President

October 16, 1998
2929 Allen Parkway
Houston, Texas 77019
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USLIFE INCOME FUND, INC.
2929 ALLEN PARKWAY
HOUSTON, TEXAS 77019
---------------------

PROXY STATEMENT

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

This Proxy Statement is furnished in connection with the solicitation of
proxies by and on behalf of the Board of Directors ("Board") of USLIFE Income
Fund, Inc. ("Fund") for use at the Annual Meeting ("Meeting") of the Fund's
shareholders on November 20, 1998. At the Meeting, shareholders will be asked to
approve the use of supermajority voting in certain circumstances, the
implementation of a staggered Board of Directors, the election of twelve
Directors to the Board and the ratification of KPMG Peat Marwick LLP as the
Fund's independent auditor. The Meeting will be held in Meeting Room 1 of The
Variable Annuity Life Insurance Company ("VALIC" or the "Adviser"), an indirect
wholly-owned subsidiary of American General Corporation, Plaza Level, The
Woodson Tower, 2919 Allen Parkway, Houston, Texas 77019 at 10:00 a.m. Central
Time, for the purposes set forth in the Notice of Meeting.

The Fund's shareholders of record as of the close of business on October 6,
1998 ("Record Date"), are entitled to notice of and to vote at the Meeting and
any adjournment thereof on the following proposals:

1. To approve amendments to the Fund's Articles of Incorporation and Bylaws
to require a vote of at least 75% of the Fund's shareholders
("SUPERMAJORITY VOTING") to approve: (a) any proposal to convert the
Fund from a closed-end investment company to an open-end investment
company; (b) any shareholder proposal as to specific investment
decisions made or to be made regarding the Fund's assets; and (c) any
business combination.

3. To elect twelve Directors to the Board.

4. To ratify the selection of KPMG Peat Marwick LLP as independent auditor
of the Fund for the fiscal year ending June 30, 1999.

5. To transact such OTHER BUSINESS as may properly come before the Meeting
or any adjournments thereof.

A COPY OF THE MOST RECENT ANNUAL REPORT FOR THE FUND CAN BE OBTAINED
WITHOUT CHARGE BY CALLING GEORGENSON & COMPANY INC. TOLL-FREE AT 1-800-223-2064.

Each full share outstanding is entitled to one vote, and each fractional
share outstanding is entitled to the corresponding proportion of one vote, with
respect to each matter voted upon by the shareholders of the Fund. As of the
Record Date, the Fund had 5,643,768 shares issued and outstanding. To the
knowledge of the Fund's management, no officer, director or nominee of the Fund
beneficially owned, individually or as a group, more
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than 1% of the outstanding shares of the Fund, and no person beneficially owned
5% or more of the outstanding shares of the Fund as of that date.

All costs associated with the Meeting, including the solicitation of
proxies, will be borne by the Fund. The solicitation of proxies will be made
primarily by mail but also may be made by telephone and/or personal contact by
directors and officers of the Fund and by regular employees of VALIC or its
affiliates. The Fund has retained the services of Georgeson & Company Inc. to
solicit proxies and has agreed to pay $7,500, plus expenses, for such services.

The individuals named as proxies on the enclosed proxy card will vote in
accordance with your directions as indicated thereon if your proxy is received
properly executed by you or by your duly appointed agent or attorney-in-fact. If
you properly execute your proxy card and give no voting instructions, your
shares will be voted in favor of the proposals described in this Proxy
Statement. You may revoke your proxy at any time prior to its exercise at the
Meeting by written notice to the Fund, by execution of a subsequent proxy or by
voting in person at the Meeting.

A quorum, a majority of the Fund's issued and outstanding voting shares as
of the close of business on the Record Date represented in person or by proxy,
must be present for the transaction of business at the Meeting. In the absence
of a quorum or in the event that a quorum is present at the meeting but
sufficient votes to approve the proposals are not received, the persons named as
proxies may propose one or more adjournments of the Meeting to permit further
solicitation of proxies. Any such adjournment will require the affirmative vote
of those shares represented at the Meeting in person or by proxy. If a quorum is
present, the persons named as proxies will vote those proxies which they are
entitled to vote FOR the proposal in favor of such an adjournment, and will vote
those proxies required to be voted AGAINST any such proposal against such
adjournment.

If a shareholder participates in the Fund's Automatic Dividend Investment
Plan ("Plan") and holds shares in his or her name in addition to the shares held
in custody for the shareholder pursuant to the Plan, the proxy to vote shares
registered in the shareholder's name will serve as instructions for voting
shares held in custody for the shareholder pursuant to the Plan. If a
shareholder does not send a proxy to vote the shares registered in his or her
name, the shares held for the shareholder's account in the Plan will not be
voted.

Broker non-votes are shares held in street name for which the broker
indicates that instructions have not been received from the beneficial owners or
other persons entitled to vote and the broker does not have discretionary voting
authority. Abstentions and broker non-votes will be counted as shares present
for purposes of determining whether a quorum is present but will not be voted
for or against any adjournment or proposal. Abstentions and broker non-votes
also will not be counted as votes cast for purposes of determining whether
sufficient votes have been received to approve a proposal. Accordingly,
abstentions and broker non-votes effectively will be a vote against adjournment
or against any proposal where the required vote is a percentage of the shares
present.

The Notice and Proxy Statement are being mailed to shareholders on or about
October 16, 1998.

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BACKGROUND

In recent years, closed-end investment companies like the Fund, have been
the subject of attempts by certain persons to alter their structure or to engage
in extraordinary corporate transactions to realize profit from the liquidation
of fund assets. In an effort to minimize such attempts, the Board has proposed
two amendments to the Fund's Articles of Incorporation and Bylaws: the
requirement to use supermajority voting for approving certain actions, discussed
in the first section, and the implementation of a staggered Board of Directors,
discussed in the next section. The Board has proposed the amendments regarding
supermajority voting in an effort to ameliorate the deleterious effect that a
large voting block may have on the operations of the Fund and the interests of
the Fund's shareholders. The Board has proposed the amendments regarding the
implementation of a staggered board in order to minimize the ability of certain
persons to obtain control of the Fund by electing their own slate of Directors
or by achieving some other goal, such as repurchasing their shares at a premium
by threatening to obtain such control.

The Board is not proposing these amendments as a result of any specific
action or event involving the Fund, but rather in light of recent events
affecting closed-end investment companies in general. The Fund's Bylaws do not
presently contain other provisions having an anti-takeover effect and these
amendments are not part of a plan by management to adopt other anti-takeover
amendments.

SECTION 1: PROPOSED AMENDMENTS TO ARTICLES OF
INCORPORATION AND BYLAWS TO MANDATE SUPERMAJORITY
VOTING FOR APPROVING CERTAIN ACTIONS

A. THE CURRENT REQUIREMENTS

The Fund's Bylaws currently provide that a majority of votes cast at a
meeting of shareholders, duly called and at which a quorum is present, shall be
sufficient to take any action on any matter which may properly come before the
meeting, unless more than a majority vote is required by statute or the Fund's
Articles of Incorporation.

B. THE PROPOSED AMENDMENTS

The Board has considered and unanimously approved for submission to the
Fund's shareholders proposed amendments to the Fund's Articles of Incorporation
and Bylaws to require the use of supermajority voting in approving certain
actions. Supermajority voting means any percentage voting requirement that
exceeds the comparable requirement under applicable law. The proposed amendments
would require a vote of at least 75% of the shareholders to approve the
following matters: (a) any proposal to convert the Fund from a closed-end
investment company to an open-end investment company; (b) any shareholder
proposal as to specific investment decisions made or to be made regarding the
Fund's assets; and (c) any business combination.

As noted above, the first matter requiring a supermajority vote pertains
solely to the conversion of the Fund from a closed-end to an open-end form. The
second matter pertains to shareholder proposals directing the investment of Fund
assets including, but not limited to, proposals that would require the Fund to
purchase securities of certain publicly-held companies, securities issued in
private placement transactions or any other direction of the Fund's investments.
The third matter, any business combination, is defined by the following

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specific parameters: (a) any merger or consolidation of the Fund with another
entity; (b) any sale, lease, exchange, mortgage, pledge, transfer or other
disposition (in one transaction or a series of transactions) to or with any
other entity of any assets of the Fund except for portfolio transactions of the
Fund effected in the ordinary course of the Fund's business; or (c) the issuance
or transfer by the Fund (in one transaction or a series of transactions) of any
shares of the Fund to any other entity in exchange for cash, securities or other
property (or a combination thereof) excluding sales of any shares of the Fund in
connection with a public offering.

The Fund is organized as a Maryland corporation. Currently, Maryland law
does not require that shareholders of registered investment companies comply
with supermajority voting requirements in approving certain business
transactions.

A copy of the proposed amendments regarding supermajority voting is
attached as Exhibit A.

C. WHY THE BOARD SUPPORTS THE ADOPTION OF THE PROPOSED AMENDMENTS

The proposed amendments to require supermajority voting in the instances
set forth above could limit the ability of certain persons, including a majority
of the shareholders, to change the structure of the Fund, to cause the Fund to
engage in certain transactions or to be acquired by another entity. In the
opinion of the Board, however, the proposed amendments offer several advantages.

THE PURCHASE OF THE FUND'S SHARES FOR THE PURPOSE OF REALIZING SHORT TERM
GAINS THROUGH THE CONVERSION OF THE FUND WILL BE DISCOURAGED. As noted above, in
recent years, closed-end investment companies like the Fund, have been the
subject of attempts by large institutional shareholders and others to convert
their structure to an open-end mutual fund form. One argument for conversion has
been that if a closed-end fund converts to an open-end fund, the possibility
that the fund's shares may trade at a discount to net asset value is eliminated.
The Board believes that a conversion motivated by such a reason is not one that
would be supported by the Fund's current shareholders, who have chosen to
purchase shares in the Fund in preference to purchasing shares of open-end
mutual funds available on the market. The Board recognizes that the adoption of
the proposed amendments could deprive some shareholders under certain
circumstances of an opportunity to sell their shares at a premium equal to the
discount, if any.

THE FUND'S ABILITY TO PURSUE LONG-TERM STRATEGIES CONSISTENT WITH ITS
INVESTMENT OBJECTIVES IS PRESERVED. While the purchase of shares in a closed-end
fund occurs in the secondary market, an open-end fund redeems its shares
directly at the current offering price listed in the prospectus. Since an
open-end fund must be able to redeem its shares at any time, its portfolio must
contain enough readily marketable securities to enable it to raise sufficient
cash to meet redemption requests in a timely manner. Pursuant to guidelines
issued by the Securities and Exchange Commission ("SEC"), open-end investment
companies are generally required to maintain at least 85% of their assets in
"liquid" securities, although the guideline is 90% in the case of a money market
fund. An asset is generally considered "illiquid" if a fund cannot dispose of
the asset in the ordinary course of business within seven days at approximately
the price at which the fund has valued it. In contrast, a closed-end fund is not
subject to those liquidity requirements and may keep its assets fully invested
according to its investment objectives, thus providing its shareholders with the
opportunity for greater investment returns. For example, of the Fund's total
assets, up to 30% may be invested in privately placed securities which are not
readily marketable.

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7

For a more detailed discussion of the Fund's investment objectives, see
"Information About The Fund, Structure and Investment Objectives," below.

THE FUND'S PORTFOLIO MANAGEMENT REMAINS STREAMLINED. Open-end investment
companies must compute the net asset value of their shares on a daily basis and
engage in a continuous distribution of those shares. These restrictions,
together with the need to acquire and liquidate portfolio assets as a result of
share purchase and redemption requests, may complicate portfolio management and
is incompatible with the investment objectives and policies of a closed-end
fund.

THE FUND'S EXPENSE RATIOS ARE NOT LIKELY TO INCREASE IF IT REMAINS IN A
CLOSED-END FORM. Conversion to open-end mutual fund form may result in a gradual
decline in a fund's size if redemption requests are not matched by new sales,
leading to increased expense ratios for remaining shareholders.

ACQUIRING CONTROL OF THE FUND WILL BE MORE DIFFICULT. The proposal to
require supermajority voting for approving business combinations means that a
larger number of shareholders must approve a takeover, merger or liquidation of
the Fund. Thus, this proposal makes it more difficult for others to acquire
control of the Fund. In the opinion of the Board, however, this provision will
increase the Fund's ability to resist takeover attempts and attempts to change
the business nature of the Fund that are not supported by either the Board or a
substantial majority of shareholders.

REQUIRED VOTE

The proposed amendments to the Fund's Articles of Incorporation and Bylaws
concerning the use of supermajority voting requires the affirmative vote of a
majority of the shareholders present at the Meeting in person or by proxy and
entitled to vote, provided a quorum is present.

If the shareholders do not approve these amendments, the Fund will continue
to use majority voting in approving a conversion of the Fund's structure,
shareholder proposals regarding investment of the Fund's assets and any business
combination.

The Board of Directors has considered and determined that the adoption of
the proposed amendments to require supermajority voting in the instances set
forth above is in the best interests of shareholders.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE FUND'S SHAREHOLDERS
VOTE "FOR" THE PROPOSED AMENDMENTS REGARDING THE USE OF SUPERMAJORITY VOTING FOR
APPROVING CERTAIN ACTIONS.

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8

SECTION 2: PROPOSED AMENDMENTS TO THE ARTICLES OF
INCORPORATION AND BYLAWS TO IMPLEMENT
A STAGGERED BOARD OF DIRECTORS

A. THE CURRENT REQUIREMENTS

The Fund's Bylaws currently provide that each Director shall hold office
until the next meeting of shareholders following his or her election, and until
his or her successor is duly elected and qualifies, or until his or her
resignation, death or removal. In addition, the Bylaws specify that the number
of Directors of the Board shall not be less than three nor more than twenty.
Since the Fund currently holds a meeting of shareholders each year, all
Directors of the Fund are elected annually to serve one year terms.

B. THE PROPOSED AMENDMENTS

The Board has considered and unanimously approved for submission to the
Fund's shareholders proposed amendments to the Fund's Articles of Incorporation
and Bylaws to implement a staggered Board that would consist of three classes of
Directors. If shareholders approve the proposed amendments, the twelve directors
proposed to be elected at this meeting would be divided into three separate
classes as follows: four directors constituting one class would be elected for a
term expiring at the 1999 annual meeting of shareholders; four directors
constituting a second class would be elected for a term expiring at the 2000
annual meeting of shareholders; and four directors constituting a third class
would be elected for a term expiring at the 2001 annual meeting of shareholders.
At each annual meeting of shareholders, directors will be elected to succeed
those whose terms expired, and each newly elected director will serve for a
three-year term. Subject to the limitations imposed by the Investment Company
Act of 1940, as amended ("1940 Act"), a vacancy which occurs during the year may
be filled by the Board. A replacement selected by the Board will serve until the
next annual meeting of shareholders and until his or her successor is elected
and qualified.

The proposed amendments are comparable to the applicable requirements under
Maryland law, which provides for the division of Directors into classes.
Maryland law states that the term of office for Directors divided into classes
may be provided in the company's Bylaws except that the term of office of a
Director may not be longer than five years or, except in the case of an initial
or substitute Director, shorter than the period between annual meetings.
Maryland law further states that the term of office of at least one class shall
expire each year.

A copy of the proposed amendments to the Fund's Articles of Incorporation
and Bylaws regarding the implementation of a staggered Board is attached as
Exhibit B.

C. WHY THE BOARD SUPPORTS THE ADOPTION OF THE PROPOSED AMENDMENTS

The proposed amendments to implement a staggered Board could have the
effect of making it more difficult to make changes in the Board of Directors,
i.e., to replace a majority of the Board at any given time for any reason. If
the proposed amendments are approved, the number of annual meetings to replace a
majority of Board members would be increased from one to two, and to replace the
entire Board, from one to three. Moreover, the proposed amendments would be
applicable to every election of Directors. In the opinion of the Board, however,
this proposal offers several advantages.

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9

CONTINUITY AND EXPERTISE IN THE FUND'S MANAGEMENT WILL OCCUR. At any given
time, two thirds of the Directors will be incumbent Directors who will have
gained expertise in the Fund's management and operations due to their experience
as Directors of the Fund. The Board believes that this, in turn, will permit the
Directors to represent more effectively the interests of all shareholders in
various situations including, in particular, responding to the demands of a
minority shareholder or group of shareholders.

CONTINUITY IN THE FUND'S INVESTMENT OBJECTIVES AND PORTFOLIO MANAGEMENT
WILL LIKEWISE OCCUR. The ability of others to gain control of the Fund will be
lessened. In addition, the Fund will be able to continue to pursue long term
strategies consistent with its investment objectives and its portfolio
management will be streamlined.

For a further discussion of continuity in the Fund's management and
investment objectives, see "Why the Board Supports the Adoption of the Proposed
Amendments" in the section discussing supermajority voting.

REQUIRED VOTE

The proposed amendments to the Fund's Articles of Incorporation and Bylaws
to implement a staggered Board of Directors requires the affirmative vote of a
majority of the shareholders present at the Meeting in person or by proxy and
entitled to vote, provided a quorum is present.

If the shareholders do not approve these amendments, the Fund's Directors
will continue to be elected to serve for a one year term and until their
respective successors are elected and qualified.

The Board of Directors has considered and determined that the adoption of
the proposed amendments to implement a staggered Board is in the best interests
of shareholders.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE FUND'S SHAREHOLDERS
VOTE "FOR" THE PROPOSED AMENDMENTS REGARDING THE IMPLEMENTATION OF A STAGGERED
BOARD OF DIRECTORS.

SECTION 3: ELECTION OF TWELVE DIRECTORS TO THE FUND'S BOARD

A. BACKGROUND

The Board currently consists of six Directors, all of whom are standing for
re-election. Dr. Norman Hackerman, Dr. John Wm. Lancaster, Dr. F. Robert
Paulsen, Dr. R. Miller Upton and Messrs. Ben Love and Craig Rodby are the
members of the current Board. Six other individuals have been approved by the
Board of Directors to stand for election to the Board to hold office until their
successors are elected and qualified.

As explained previously, shareholders will be asked at the Meeting to
approve amendments to the Fund's Articles of Incorporation and Bylaws to
implement a staggered board of directors. If shareholders approve these
amendments, the Board will be divided into three classes of directors comprised
of four individuals per class. The term of one class will expire each year and
no director's term shall continue for more than three years after the applicable
election.

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10

The following table sets forth certain information regarding each nominee
including those whose current terms will expire in 2000 and 2001. It is the
intention of the persons named in the accompanying Proxy to vote for the
election of the persons named below. Each nominee has indicated a willingness to
serve if elected. If any nominee should not be available for election due to
unforeseen circumstances, it is the intention of the persons named in the
accompanying Proxy to vote for such other persons as the Board may recommend.

B. NOMINEE INFORMATION

EXPIRATION
OF TERM IF
POSITIONS WITH BUSINESS EXPERIENCE ELECTED AS A
NAME AND BIRTH DATE FUND AND TERM DURING THE LAST FIVE YEARS DIRECTOR
- ------------------- -------------- -------------------------- ------------

Thomas L. West, Jr.* N/A Director and Executive Vice 1999
06/07/37 President (1994-1997); Chairman of
the Board and Chief Executive
Officer (1997-Present); President
(1994-1998) VALIC and Chairman and
Chief Executive Officer American
General Annuity Insurance Company
("AGAIC") (1998-Present). Formerly,
Senior Vice President -- Annuity
Business Unit, Aetna Life Insurance
& Annuity Co. (1987-1994).(3)(4)
Judge Gustavo E. Gonzales, N/A Municipal Court Judge, Dallas, 1999
Jr. Texas; Director, Downtown Dallas
7/27/40 YMCA Board (1996-Present); Director,
Dallas Easter Seals Society
(1997-Present).(4)
Dr. F. Robert Paulsen Director since 1997 Dean Emeritus and Professor 1999
7/05/22 Emeritus, College of Higher
Education, University of Arizona,
Tucson, Arizona. Formerly, Dean and
Professor, University of
Connecticut, Storrs, Connecticut and
Carnegie Fellow, University of
Michigan, Ann Arbor,
Michigan.(1)(2)(3)(4)
Dr. R. Miller Upton Director since 1997 Consultant; President Emeritus, 1999
12/27/16 Beloit College, Beloit, Wisconsin.
Formerly, Director, Home Life
Insurance Company of New York
(1961-1991) and Director, Household
International, Inc.
(1965-1989).(1)(2)(3)(4)

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11

Craig R. Rodby* Chairman of the Board Executive Vice President, American 2000
07/05/49 since 1997 General Series Portfolio Company
(1998 to Present); Vice Chairman
(1997-Present) and Chief Financial
Officer (1998-Present), VALIC and
AGAIC (1998-Present). Formerly,
Senior Vice President -- Financial
Management, ReliaStar (1994-1997)
and President & Chief Executive
Officer, Northern Life Insurance
Company (1990-1994).(4)
Dr. Timothy J. Ebner N/A Professor, Departments of 2000
07/15/49 Neurosurgery and Physiology,
University of Minnesota
(1991-Present). Formerly, Consultant
EMPI Inc. (1994-1995) and Medtronic
Inc. (1997-1998).(4)
Dr. John Wm. Lancaster Director since 1997 Retired. Pastor Emeritus and 2000
12/15/23 Director of Planned Giving, First
Presbyterian Church, Houston, Texas.
Formerly, Pastor, First Presbyterian
Church, Houston, Texas
(1961-1990).(3)(4)
Dr. John E. Maupin, Jr. N/A President, Meharry Medical College, 2000
10/28/46 Nashville, Tennessee; Nashville
Advisory Board Member, First
American National Bank (1996-
Present); Director, Monarch Dental
Corporation (1997-Present).
Formerly, Executive Vice President,
Morehouse School of Medicine,
Atlanta, Georgia (1989-1994).(4)

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12

John A. Graf* N/A President and Director, VALIC (1998 2001
09/14/59 to Present) and AGAIC (1998 to
Present). President, American
General Series Portfolio Company,
American General Series Portfolio
Company 2 and 3 (1998 to Present).
Director, Boy Scouts of America.
Formerly, Director (1993-1998),
President and Chief Executive
Officer (1997-1998), Vice Chairman
(1996-1997) and Chief Marketing
Officer (1993-1997) and Executive
Vice President (1993-1996), Western
National Life Insurance Corporation
and Senior Vice President, Conseco,
Inc. (1987-1993)(4)
Dr. Judith L. Craven N/A Physician, Administrator; President, 2001
10/06/45 United Way of Texas Gulf Coast
(1992-1998); Director, A.H. Belo
Corporation (1993-Present);
Director, Sysco Corporation
(1996-Present); Director, Sisters of
Charity of the Incarnate Word
(1996-Present).(4)
Dr. Norman Hackerman Director since 1997 Chairman -- Scientific Advisory 2001
3/02/12 Board for The Robert A. Welch
Foundation (1983-Present); Director,
Electro-source, Inc.; President
Emeritus, Rice University, Houston,
Texas. Formerly, Professor Emeritus,
University of Texas, Austin, Texas
(1970-1985).(1)(2)(3) (4)
Ben H. Love Director since 1997 Retired. Formerly, Director, 2001
9/26/30 Mid-American (1993-1997) and Chief
Executive, Boy Scouts of America.
(1985-1993).(3)(4)

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

* Considered an "interested person" of the Fund, as defined in Section
2(a)(19) of the 1940 Act, specifically because of his or her capacity as an
officer, Director or consultant of the Fund, VALIC or American General
Corporation. Any director who is not an interested person of the Fund may be
referred to hereafter as an "Independent Director."

(1) Retired Managing General Partner of Van Kampen American Capital Exchange
Fund.

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13

(2) Retired Trustee of Van Kampen American Capital Bond Fund, Inc., Van Kampen
American Capital Income Trust, Van Kampen American Capital Convertible
Securities Fund, Inc., and the Common Sense Trust.

(3) Director, American General Series Portfolio Company.

(4) Trustee, American General Series Portfolio Company 2 and American General
Series Portfolio Company 3.

No nominee beneficially owns more than one percent of the Fund's outstanding
shares.

C. SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

The Fund is required to identify any director or officer who failed to
timely file with the SEC a required report pertaining to ownership of the Fund's
equity securities on Form 3. All members of the current Board filed Form 3 late.

In addition, the following officers and directors of the Fund or the
Adviser filed Form 3 late: B. Abrams, M. Atnip, J. D'Agostino, R. Devlin, C.
Gibbons, P. Grady, J. Graf, N. Jaskol, D. Magee, B. Nelson, J. Newton, L. Olver,
J. Osborne, K. Pearce, C. Rodby, R. Scott, J. Sepulveda, G. Seward, D. Sharps,
C. Toles, P. Tuters, T. West and B. Wilson.

Each person who was required to file a Form 3 filed a full and complete
copy of the form. None of the current officers are shareholders of the Fund.

D. BOARD OF DIRECTORS' COMMITTEES AND MEETINGS

The Board has appointed an Audit Committee and a Nominating Committee, but
has not appointed a Compensation Committee. The functions of the Nominating
Committee have been performed by three of the current Board members.
Shareholders may submit written recommendations to the Board regarding nominees
for director, although the Board expects to be able to identify an ample number
of qualified candidates. The Nominating Committee currently consists of Dr.
Hackerman and Messrs. Love and Rodby.

The Audit Committee selects, and recommends for approval by the Board and
the shareholders, the audit firm to be retained as independent auditor by the
Fund. The Audit Committee consults with the Fund's independent auditor regarding
the plan and scope of the audit, the adequacy of the Fund's internal accounting
procedures and controls and all matters relevant to the audit services provided
to the Fund. The Audit Committee also reviews the fees charged by the auditor
and the results of the audit.

The Audit Committee currently consists of Dr. Hackerman, Dr. Lancaster, Dr.
Paulsen, Dr. Upton and Messr. Love. The Board will elect the Members of the
Audit Committee following the election of new Directors on November 20, 1998.

During the fiscal year ended June 30, 1998, the Board met four times at
regularly scheduled meetings. The Audit and Nominating Committee meet only on
call. During the year ended June 30, 1998, the Audit Committee met two times,
and the Nominating Committee met six times. There are no incumbent members of
the Board who, during the last fiscal year of the Fund, attended fewer than 75%
of the aggregate meetings of the Board of Directors or its committees on which
they serve.

11
14

E. EXECUTIVE COMPENSATION

Members of the Board of Directors receive an annual retainer of $2,000,
$500 for each Board meeting attended in person and $250 for each Board meeting
conducted by telephone. Audit and Nominating Committee members receive an
additional $250 for each committee meeting attended on a date other than the
date the Board of Directors meets. Committee chairs receive an additional $250
for each committee meeting chaired. Directors who are officers of the Fund are
not compensated for their service on the Board.

During the fiscal year ended June 30, 1998, the Fund paid $38,333 to VALIC,
the investment adviser since September 24, 1997 and $11,667 to USLIFE Advisers,
Inc., the investment adviser from July 1, 1997 to September 24, 1997 in
reimbursement of compensation and other expenses attributable to the offices of
the Fund's Secretary and Treasurer as provided under the respective Advisory
Agreement(s). In the fiscal year ended June 30, 1998, the aggregate cash
compensation earned by all Directors and the three highest-paid officers of the
Fund, exclusive of fees paid for the services of Secretary and Treasurer, was
$29,190.

Under a Deferred Compensation Plan adopted by the Board in 1979, Directors
who receive fees for their services and who are not also employees of the Fund
may elect to defer all or part of the payment of their compensation until the
termination of their service as Directors. Deferred amounts accrue earnings at
an interest equivalent which is adjusted annually, the federal 5-year Treasury
bill rate, as published in the Wall Street Journal on the first business day of
each year. Participating Directors may elect to receive distributions of
deferred fees and accrued interest in one payment or in equal annual
installments (not to exceed ten) after ceasing to be a Director of the Fund.

12
15

COMPENSATION TABLE

PENSION OR
RETIREMENT TOTAL COMPENSATION
AGGREGATE BENEFITS ACCRUED FROM FUND AND
COMPENSATION AS PART OF FUND FUND COMPLEX PAID
NAME OF PERSON, POSITION FROM FUND EXPENSES TO DIRECTORS(1)
------------------------ ------------ ---------------- ------------------

Dr. Kalman J. Cohen, Former Director............. $2,065(2) 0 $ 2,065(2)
Richard L. Ellis, Former Director................ 2,065 0 2,065
John M. Kingsley, Jr., Former Director........... 2,065 0 2,065
William M.R. Mapel, Former Director.............. 2,065 0 2,065
Ralph F. Peters, Former Director................. 2,065 0 2,065
Dr. Norman Hackerman, Director................... 5,073 0 38,073
Dr. John Wm. Lancaster, Director................. 3,073 0 30,073
Ben H. Love, Director............................ 5,073 0 38,073
Dr. F. Robert Paulsen, Director.................. 3,073 0 30,073
Craig R. Rodby, Chairman......................... 0 0 0
Dr. R. Miller Upton, Director.................... 2,573 0 28,073

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

(1) USLIFE Income Fund, Inc. is part of a fund complex which also includes
American General Series Portfolio Company, American General Series Portfolio
Company 2 and American General Series Portfolio Company 3.

(2) Dr. Cohen has accumulated a total of $235,554.15 under the Fund's Deferred
Compensation Plan.

F. EXECUTIVE OFFICERS AND SIGNIFICANT EMPLOYEES

POSITION(S) WITH BUSINESS EXPERIENCE DURING
NAME AND DATE OF BIRTH FUND AND TERM THE LAST 5 YEARS
- ---------------------- ---------------- --------------------------

Peter V. Tuters President since 1998 Executive Vice President, American
4/18/52 General Investment Management L.P.
(1998-Present). Vice President and
Investment Officer (1998 to Present),
Vice President and Chief Investment
Officer (1993-1998), VALIC and AGAIC
(1998-Present); Former Director, VALIC;
Senior Investment Officer, American
General Series Portfolio Company,
American General Series Portfolio
Company 2 and 3 (1998-Present). Senior
Vice President and Chief Investment
Officer, American General Corporation
(1993-1998).

13
16

POSITION(S) WITH BUSINESS EXPERIENCE DURING
NAME AND DATE OF BIRTH FUND AND TERM THE LAST 5 YEARS
- ---------------------- ---------------- --------------------------

Leon A. Olver Vice President since 1997 Portfolio Manager, VALIC (1995 to
6/27/51 Present) and Vice President and
Investment Officer, American General
Series Portfolio Company (1995 to
Present). Formerly, Vice President and
Treasurer, First Heights Bank
(1994-1995); Vice President and
Assistant Treasurer, First Heights Bank
(1991-1994); Assistant Vice President,
Pulte Financial Companies (1984-1991).
Cynthia A. Toles Vice President since 1998 and Senior Vice President, General Counsel
03/28/51 Secretary since 1997 and Secretary, VALIC (1998-Present) and
AGAIC (1998-Present). Director and
Secretary, Variable Annuity Marketing
Company. Vice President (1998 to
Present), General Counsel and Secretary
(1985-Present), American General Series
Portfolio Company. Vice President and
Secretary, American General Series
Portfolio Company 2 and 3 (1998 to
Present). Formerly, Senior Associate
General Counsel and Secretary, VALIC
(1990-1998).
Nori L. Gabert Vice President since 1998 and Associate General Counsel, VALIC (1997
08/15/53 Assistant Secretary since 1997 to Present). Formerly, Of Counsel,
Winstead Sechrest & Minick P.C. (1997);
Vice President and Associate General
Counsel of Van Kampen American Capital,
Inc. (1981-1996).
Cynthia A. Gibbons Assistant Vice President since Senior Compliance Analyst, VALIC (1996
12/06/67 1998 to Present). Assistant Vice President,
American General Series Portfolio
Company, American General Series
Portfolio Company 2 and 3
(1998-Present); Assistant Vice
President, AGA Series Trust (1998-
Present).

14
17

POSITION(S) WITH BUSINESS EXPERIENCE DURING
NAME AND DATE OF BIRTH FUND AND TERM THE LAST 5 YEARS
- ---------------------- ---------------- --------------------------

Gregory R. Seward Treasurer since 1997 Vice President -- Variable Product
06/27/56 Accounting (1998 to Present); Assistant
Controller (1991 to 1998), VALIC and
AGAIC (1998 to Present). Treasurer,
American General Series Portfolio
Company (1991 to Present), American
General Series Portfolio Company 2 and
3 (1998 to Present). Formerly,
Controller, Avanti Health Systems, Inc.
(1988-1991); Reports Manager, American
Capital Asset Management, Inc.
(1986-1988); Senior Auditor, Price
Waterhouse (1982-1986).
Kathryn A. Pearce Assistant Treasurer since 1997 Associate Director -- Fund Accounting,
02/05/47 VALIC (1996 to Present). Controller,
American General Series Portfolio
Company (1996 to Present) and
Controller, American General Series
Portfolio Company 2 and 3 (1998 to
Present). Formerly, Supervisor --
Mutual Fund Accounting, Van Kampen
American Capital, Inc. (1977-1996).
Jaime M. Sepulveda Assistant Treasurer since 1998 Director -- Variable Product Accounting
01/09/52 and Financial Reporting, VALIC (1998 to
Present). Assistant Treasurer, American
General Series Portfolio Company,
American General Series Portfolio
Company 2 and 3 (1998 to Present).
Formerly, Accounting Manager, Metro
Networks, Inc. (1997-1998); Controller
and Investment Officer, Port of Houston
Authority (1994-1997); Chief Financial
Officer, Intile Designs, Inc.
(1993-1994).

The business address of each officer is 2929 Allen Parkway, Houston, Texas
77019.

REQUIRED VOTE

The election of Directors requires the affirmative vote of a majority of
the shareholders present at the Meeting in person or by proxy and entitled to
vote, provided a quorum is present.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE FUND'S SHAREHOLDERS
VOTE "FOR" ALL NOMINEES TO THE BOARD.

15
18

SECTION 4: RATIFICATION OF KPMG PEAT MARWICK LLP AS
INDEPENDENT AUDITOR

The Board, including a majority of the Independent Directors, has selected
KPMG Peat Marwick LLP to continue to serve as independent auditor of the Fund
for the fiscal year ending June 30, 1999, subject to ratification by the Fund's
shareholders.

KPMG Peat Marwick LLP has served as the Fund's independent auditor since
1972 and has no direct financial interest or material indirect financial
interest in the Fund. Representatives of KPMG Peat Marwick LLP will be present
at the annual shareholders' meeting and will have the opportunity, at their
discretion, to make a statement and to respond to appropriate shareholder
questions.

KPMG Peat Marwick LLP's audit services for the fiscal year ended June 30,
1998 included: auditing the Fund's annual financial statements; preparing the
Fund's federal and state income tax return; preparing the Fund's federal excise
tax return; consulting with the Fund's Audit Committee; and engaging in routine
consultations on financial accounting and reporting matters.

The Audit Committee authorized all services performed by KPMG Peat Marwick
LLP on behalf of the Fund. In addition, the Audit Committee reviews the scope of
services to be provided by KPMG Peat Marwick LLP annually and considers the
effect, if any, that performance of any non-audit services might have on audit
independence.

REQUIRED VOTE

The ratification of the selection of independent auditors requires the
affirmative vote of a majority of the shareholders present at the Meeting in
person or by proxy and entitled to vote, provided a quorum is present.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE FUND'S SHAREHOLDERS
VOTE "FOR" KPMG PEAT MARWICK LLP AS INDEPENDENT AUDITOR.

SECTION 5: INFORMATION ABOUT THE FUND

A. STRUCTURE AND INVESTMENT OBJECTIVES

USLIFE Income Fund, Inc. is a closed-end, diversified management investment
company organized as a Maryland corporation on October 17, 1972. The Fund's
shares are listed for trading on the New York Stock Exchange, Inc.

The Fund seeks to provide a high level of current income to shareholders
through investment in a diversified portfolio composed primarily of fixed income
securities which management considers to be suitable. In meeting its objective,
the Fund invests at least 50% of its total assets in straight debt securities
which are rated at the time of purchase within the four highest grades by
Moody's Investors Service, Inc. or Standard & Poor's Ratings Service, a division
of the McGraw-Hill Companies, Inc., both of which are considered by the Fund's
management to be of comparable quality. The balance of the Fund's assets are
invested in other fixed income securities, including straight and convertible
debt securities, preferred stock and other securities with equity features. Of
the Fund's total assets, up to 30% may be invested in privately placed
securities which are not readily marketable. The Fund may not invest more than
20% of its net assets in foreign securities. The
16
19

Fund may also borrow money to obtain investment leverage. The relative size of
the Fund's investments in any grade or type of securities will vary from time to
time depending upon a number of factors, including yields, market supplies and
economic outlook.

B. THE FUND'S INVESTMENT ADVISER

VALIC is a stock life insurance company and became the Fund's Adviser on
September 25, 1997 pursuant to a new investment advisory agreement. VALIC is
wholly-owned by American General Life Insurance Company, which is itself a
wholly-owned subsidiary of AGC Life Insurance Company, a wholly-owned subsidiary
of American General Corporation ("American General"). VALIC, American General,
AGC Life Insurance Company and American General Life Insurance Company are
located at 2929 Allen Parkway, Houston, Texas 77019.

USLIFE Advisers, Inc. (the "Former Adviser") served as the Fund's
investment adviser from August 4, 1976 through June 17, 1997. On June 17, 1997,
the parent company of the Former Adviser, USLIFE Corporation, merged with and
into a wholly-owned subsidiary of American General and the Former Adviser became
an indirectly wholly-owned subsidiary of American General. From June 17, 1997
through September 24, 1997, the Former Adviser served as the Fund's adviser
pursuant to an interim advisory agreement.

C. CUSTODIAN, TRANSFER AGENT

The Chase Manhattan Bank ("CMB") serves as custodian for the Fund's
portfolio, and ChaseMellon Shareholder Services ("CSS") acts as transfer agent,
dividend paying agent and registrar for the Fund's shares. The principal
business address of CMB is Four New York Plaza, 4th Floor, New York, New York
10004, and the principal business address of CSS is 450 West 33rd Street, New
York, NY 10001. The Fund currently does not employ a principal underwriter or
administrator.

SECTION 6: GENERAL INFORMATION

OTHER MATTERS

The Fund's management does not know of any matters to be presented to the
Meeting other than the matters set forth in this proxy statement. If other
business should properly come before the Meeting, the proxy holders will vote
thereon in accordance with their best judgment.

SHAREHOLDER PROPOSALS

The Fund is required to hold an annual meeting of its shareholders.
Eligible shareholders who wish to submit a proposal to the Fund for
consideration at the next annual meeting must do so no later than 120 calendar
days before the scheduled meeting. An eligible shareholder is one who has
continuously held at least $2,000 in market value, or 1% of the Fund's
securities entitled to vote on the proposals at the meeting for at least one
year by the date the shareholder submits the proposal, and continues to hold
those securities through the date of the meeting.

17
20

IN ORDER THAT THE PRESENCE OF A QUORUM AT THE MEETING MAY BE ASSURED,
EXECUTION AND RETURN OF THE ENCLOSED PROXY BY NOVEMBER 19, 1998 IS REQUIRED. A
SELF-ADDRESSED, POSTAGE-PAID ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE.

By Order of the Board of Directors,

------------------------------------
Peter V. Tuters
President

October 16, 1998

18
21

EXHIBIT A

AMENDMENTS TO ARTICLES OF INCORPORATION
SUPER-MAJORITY SHAREHOLDER VOTING REQUIREMENT

WHEREAS, the Board of Directors has determined that it is in the best
interests of the Fund and its shareholders to adopt a super-majority shareholder
voting requirement in connection with proposals to engage in extraordinary
transactions or modify the structure of the Fund;

RESOLVED, that the paragraphs set forth below will be added in their
entirety as Section 5 to the Seventh Article of the Articles of Incorporation of
the Fund:

A vote of at least 75% of the stockholders, in addition to any vote of
the Board of Directors as may be required by law or by the Bylaws, shall
be necessary to effect any of the following actions: (a) any amendment
to the Articles of Incorporation to convert the Corporation from a
closed-end investment company form to an open-end investment company
form (as such terms are defined in the Investment Company Act of 1940);
(b) any stockholder proposal as to specific investment decisions made or
to be made with respect to the Corporation's assets; or (c) any Business
Combination.

Business Combination shall mean the following: (a) any merger or
consolidation of the Corporation with or into any other person; (b) any
sale, lease, exchange, mortgage, pledge, transfer or other disposition
(in one transaction or a series of transactions) to or with any other
person of any assets of the Corporation except for portfolio
transactions of the Corporation effected in the ordinary course of the
Corporation's business; (c) the issuance or transfer by the Corporation
(in one transaction or a series of transactions) of any shares of the
Corporation to any other person in exchange for cash, securities or
other property (or a combination thereof) excluding sales of any shares
of the Corporation in connection with a public offering thereof.

BYLAW AMENDMENTS
SUPER-MAJORITY STOCKHOLDER VOTING REQUIREMENT

WHEREAS, Article II, Section 9 of the Bylaws of the Fund provides in
pertinent part that a majority of the votes cast at a meeting of the
stockholders, duly called and at which a quorum is present, shall be sufficient
to take any action on any matter which may properly come before the meeting,
unless more than a majority of the votes cast is required by statute or by the
Articles of Incorporation; and

WHEREAS, the Board of Directors has determined that it is in the best
interests of the Fund and its stockholders to adopt a super-majority stockholder
voting requirement in connection with proposals to engage in extraordinary
transactions or modify the structure of the Fund;

RESOLVED, that Article II, Section 9 of the Bylaws of the Fund be, and it
hereby is, amended to read in its entirety as follows:

Section 9. A majority of the votes cast at a meeting of the stockholders,
duly called and at which a quorum is present, shall be sufficient to take
any action on any matter which may properly come before
22

the meeting, except that the vote of at least 75% of the stockholders, in
addition to any vote of the Board of Directors as may be required by law or
by the Bylaws, shall be necessary to effect any of the following actions:
(a) any amendment to the Articles of Incorporation to convert the
Corporation from a closed-end investment company form to an open-end
investment company form (as such terms are defined in the Investment
Company Act of 1940); (b) any stockholder proposal as to specific
investment decisions made or to be made with respect to the Corporation's
assets; or (c) any Business Combination.

Business Combination shall mean the following: (a) any merger or
consolidation of the Corporation with or into any other person; (b) any
sale, lease, exchange, mortgage, pledge, transfer or other disposition (in
one transaction or a series of transactions) to or with any other person of
any assets of the Corporation except for portfolio transactions of the
Corporation effected in the ordinary course of the Corporation's business;
(c) the issuance or transfer by the Corporation (in one transaction or a
series of transactions) of any shares of the Corporation to any other
person in exchange for cash, securities or other property (or a combination
thereof) excluding sales of any shares of the Corporation in connection
with a public offering thereof.
23

EXHIBIT B

AMENDMENTS TO ARTICLES OF INCORPORATION
STAGGERED BOARD

WHEREAS, the Board of Directors has determined that it is in the best
interests of the Fund and its shareholders to establish three classes of
Directors with each class having a term of office no greater than three years
and with the term of office for each class expiring in a different calendar
year;

RESOLVED, that the paragraph set forth below will be added in its entirety
as the second paragraph to the Sixth Article of the Articles of Incorporation of
the Fund:

The Board of Directors shall be divided into three classes. Within the
limits above specified, the number of directors in each class shall be
determined by resolution of the Board of Directors. The term of office of
the first class shall expire on the date of the annual meeting of
stockholders first succeeding their election. The term of office of the
second class shall expire one year thereafter. The term of office of the
third class shall expire two years thereafter. Upon expiration of the term
of office in each class as set forth above, the number of directors in such
class, as determined by the Board of Directors, shall be elected for a term
of three years to succeed the directors whose terms of office expire. The
directors shall be elected at the annual meeting of the stockholders,
except as necessary to fill any vacancies as above specified, and each
director elected shall hold office until his successor is duly elected and
qualifies, or until his earlier resignation, death, or removal.

BYLAW AMENDMENTS
STAGGERED BOARD

WHEREAS, Article III, Section 2 of the Bylaws of the Fund provides in
pertinent part that each Director shall hold office until the annual meeting of
stockholders of the Fund next succeeding his election and until his successor is
duly elected and qualifies, or until his earlier resignation, death or removal;
and

RESOLVED, that Article III, Section 2 of the Bylaws of the Fund be, and it
hereby is, amended to read in its entirety as follows:

Section 2. By vote of a majority of the entire Board of Directors, the
number of Directors may be increased or decreased from time to time, but
such number shall not be less than three (3) nor more than twenty (20), and
the tenure of office of a Director shall not be affected by any decrease in
the number of Directors so made by the Board of Directors. The Board of
Directors shall be divided into three classes. Within the limits above
specified, the number of directors in each class shall be determined by
resolution of the Board of Directors. The term of office of the first class
shall expire on the date of the annual meeting of stockholders held in
1999. The term of office of the second class shall expire one year
thereafter. The term of office of the third class shall expire two years
thereafter. Upon expiration of the term of office in each class as set
forth above, the number of Directors in such class, as determined by the
Board of Directors, shall be elected for a term of three years to succeed
the Directors whose terms of office expire. The Directors shall be elected
at the annual meeting of the stockholders, except as provided
24

in Section 3 of Article III, and each Director elected shall hold office
until his successor is duly elected and qualifies, or until his earlier
resignation, death, or removal. Any vacancy created by an increase in
Directors may be filled in accordance with Section 3 of Article III.
Directors need not be stockholders.
25

USLIFE INCOME FUND, INC.

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

The undersigned hereby appoints Thomas L. West, Jr., Cynthia A. Toles and
Gregory R. Seward as proxies, each with the powers to act alone and to appoint
his or her substitute, and hereby authorizes them to represent and vote, as
designated herein, all the shares of Common Stock of USLIFE Income Fund, Inc.
which the undersigned is entitled to vote as of October 6, 1998, the record
date, at the Annual Meeting of Shareholders to be held November 20, 1998, or any
adjournment thereof.

THIS PROXY IS CONTINUED ON THE REVERSE.

PLEASE SIGN ON THE REVERSE AND RETURN PROMPTLY

USLIFE INCOME FUND, INC.

ANNUAL MEETING OF SHAREHOLDERS

FRIDAY, NOVEMBER 20, 1998
10:00 A.M.
2919 ALLEN PARKWAY
HOUSTON, TEXAS 77019
26

This proxy when properly executed will be voted in the manner directed herein by
the undersigned shareholder. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
FOR THE PROPOSAL IN ITEM 1, FOR THE PROPOSAL IN ITEM 2, FOR THE NOMINEES NAMED
IN ITEM 3, AND FOR THE SELECTION OF THE AUDITOR NAMED IN ITEM 4. All items are
proposed by the USLIFE Income Fund, Inc. ("Fund").

Please mark your vote as indicated in this example X

THE BOARD OF DIRECTORS RECOMMENDS THAT THE FUND'S SHAREHOLDERS VOTE "FOR" EACH
OF THE FOLLOWING PROPOSALS:

Item 1 -- Proposal to approve amendments to the Fund's Articles of Incorporation
and Bylaws to require a vote of at least 75% of the Fund's shareholders to
approve: (a) any proposal to convert the Fund from a closed-end investment
company to an open-end investment company; (b) any shareholder proposal as to
specific investment decisions made or to be made regarding the Fund's assets;
and (c) any business combination.

For Against Abstain
[ ] [ ] [ ]

Item 2 -- Proposal to approve amendments to the Fund's Articles of Incorporation
and Bylaws to provide for the establishment of three classes of Directors with
each class having a term of office no greater than three years and with the term
of office for each class expiring in successive calendar years.

For Against Abstain
[ ] [ ] [ ]

Item 3 -- Election of the following nominees as Directors:

[A] Thomas L. West, Jr. [B] Dr. Judith L. Craven [C] Dr. Timothy Ebner
[D] Judge Gustavo E. Gonzales, Jr. [E] John A. Graf [F] Dr. Norman Hackerman
[G] Dr. John Wm. Lancaster [H] Ben H. Love [I] Dr. John E. Maupin, Jr.
[J] Dr. F. Robert Paulsen [K] Dr. R. Miller Upton [L] Craig R. Rodby

YOU MAY WITHHOLD AUTHORITY TO VOTE FOR ANY NOMINEE BY LINING THROUGH OR
OTHERWISE STRIKING OUT THE NAME OF ANY NOMINEE.

For Against
[ ] [ ]

Item 4 -- Proposal to ratify the appointment of KPMG Peat Marwick LLP as the
independent auditor of the Fund.

For Against Abstain
[ ] [ ] [ ]

Item 5 -- In their discretion, the Proxies are authorized to vote upon such
other business as may properly come before the meeting.

Please sign as name appears
herein. Joint owners should
each sign. When signing as
attorney, executor, administrator
administrator, trustee or
guardian, please give full
title as such.

Dated: , 1998
---------------------

----------------------------------
Signature

Please sign, date and mail your proxy card by November 19, 1998.