<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM ALLIED
CAPITAL CORPORATION AND SUBSIDIARIES' CONSOLIDATED BALANCE SHEET AND 
CONSOLIDATED STATEMENTS OF OPERATIONS, CHANGES IN NET ASSETS AND CASH FLOW. IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS 
INCORPORATED BY REFERENCE IN FORM 10-K.
</LEGEND>
<MULTIPLIER> 1,000
       
                             
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          DEC-31-1997
<PERIOD-START>                             JAN-01-1997
<PERIOD-END>                               DEC-31-1997
<INVESTMENTS-AT-COST>                          690,720
<INVESTMENTS-AT-VALUE>                         697,021
<RECEIVABLES>                                        0
<ASSETS-OTHER>                                  29,226
<OTHER-ITEMS-ASSETS>                            81,528
<TOTAL-ASSETS>                                 807,775
<PAYABLE-FOR-SECURITIES>                             0
<SENIOR-LONG-TERM-DEBT>                        308,821
<OTHER-ITEMS-LIABILITIES>                       71,894
<TOTAL-LIABILITIES>                            380,715
<SENIOR-EQUITY>                                      5
<PAID-IN-CAPITAL-COMMON>                       451,044
<SHARES-COMMON-STOCK>                           52,047
<SHARES-COMMON-PRIOR>                           48,238
<ACCUMULATED-NII-CURRENT>                            0
<OVERDISTRIBUTION-NII>                         (2,679)
<ACCUMULATED-NET-GAINS>                              0
<OVERDISTRIBUTION-GAINS>                             0
<ACCUM-APPREC-OR-DEPREC>                         1,301
<NET-ASSETS>                                   420,060
<DIVIDEND-INCOME>                                    0
<INTEREST-INCOME>                               86,882
<OTHER-INCOME>                                  10,523
<EXPENSES-NET>                                  51,339
<NET-INVESTMENT-INCOME>                         46,066
<REALIZED-GAINS-CURRENT>                        10,704
<APPREC-INCREASE-CURRENT>                        7,209
<NET-CHANGE-FROM-OPS>                           61,304
<EQUALIZATION>                                       0
<DISTRIBUTIONS-OF-INCOME>                       39,576
<DISTRIBUTIONS-OF-GAINS>                        15,172
<DISTRIBUTIONS-OTHER>                           31,150
<NUMBER-OF-SHARES-SOLD>                          3,289
<NUMBER-OF-SHARES-REDEEMED>                         31
<SHARES-REINVESTED>                                551
<NET-CHANGE-IN-ASSETS>                          17,926
<ACCUMULATED-NII-PRIOR>                          5,858
<ACCUMULATED-GAINS-PRIOR>                            0
<OVERDISTRIB-NII-PRIOR>                              0
<OVERDIST-NET-GAINS-PRIOR>                           0
<GROSS-ADVISORY-FEES>                                0
<INTEREST-EXPENSE>                              26,952
<GROSS-EXPENSE>                                 51,339
<AVERAGE-NET-ASSETS>                           411,097
<PER-SHARE-NAV-BEGIN>                             8.34
<PER-SHARE-NII>                                   0.94
<PER-SHARE-GAIN-APPREC>                           0.36
<PER-SHARE-DIVIDEND>                              1.41
<PER-SHARE-DISTRIBUTIONS>                         0.17
<RETURNS-OF-CAPITAL>                              0.13
<PER-SHARE-NAV-END>                               8.07
<EXPENSE-RATIO>                                    2.5
<AVG-DEBT-OUTSTANDING>                         311,330
<AVG-DEBT-PER-SHARE>                              5.98