ALLIANCE INSTITUTIONAL FUNDS INC, N-30D, 2000-01-05

ALLIANCE INSTITUTIONAL FUNDS INC
N-30D, 2000-01-05

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ALLIANCE INSTITUTIONAL FUNDS

ANNUAL REPORT
OCTOBER 31, 1999

ALLIANCE CAPITAL

LETTER TO SHAREHOLDERS ALLIANCE INSTITUTIONAL FUNDS
_______________________________________________________________________________

December 28, 1999

Dear Shareholder:

We are pleased to provide you with an update on the performance and investment
activity of the portfolios of Alliance Institutional Funds, Inc. for the annual
reporting period ended October 31, 1999.

ALLIANCE PREMIER GROWTH INSTITUTIONAL FUND
Portfolio Manager: Al Harrison

The following table provides performance results for the Alliance Premier
Growth Institutional Fund (the "Fund") for the six- and 12-month periods ended
October 31, 1999. For comparison, we have also provided the returns for the
Standard & Poor's 500 Stock Index (the "S&P 500"), a common measure of the
broad stock market, and your Fund's benchmark, the Russell 1000 Growth Stock
Index, which measures the performance of large-cap U.S. stocks.

INVESTMENT RESULTS
For both the six- and 12-month periods ended October 31, 1999, your Fund has
provided a return well in excess of the S&P 500. For the six-month period, the
Fund modestly underperformed the Russell 1000 Growth Stock Index, although for
the 12-month period, the Fund achieved over 400 basis points of outperformance
versus the Russell 1000 Growth Stock Index. Outperformance for the 12-month
period was attributable to a strong appreciation in selected technology stocks,
high-growth telecommunication suppliers and service companies, media and
broadcasting firms and brokerage stocks. Performance during the six-month
period was tempered by declines in pharmaceutical stocks and your Fund's
underweight position in technology stocks relative to the Russell 1000 Growth
Stock Index (discussed further below).

INVESTMENT RESULTS
Periods ended October 31, 1999
TOTAL RETURNS
6 MONTHS 12 MONTHS
---------- -----------
ALLIANCE PREMIER GROWTH INSTITUTIONAL FUND
Class I 7.21% 39.17%
Class II 6.99% 38.63%

S&P 500 2.74% 25.66%

RUSSELL 1000 GROWTH STOCK INDEX 7.46% 34.25%

* THE FUND'S INVESTMENT RESULTS REPRESENT TOTAL RETURNS AND ARE BASED ON THE
NET ASSET VALUE OF EACH CLASS OF SHARES AS OF OCTOBER 31, 1999. ALL FEES AND
EXPENSES RELATED TO THE OPERATION OF THE FUND HAVE BEEN DEDUCTED. PAST
PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.

THE S&P 500 IS AN UNMANAGED INDEX OF 500 U.S. COMPANIES, AND IS A COMMON
MEASURE OF THE PERFORMANCE OF THE OVERALL U.S. STOCK MARKET. THE UNMANAGED
RUSSELL 1000 GROWTH STOCK INDEX CONSISTS OF 1000 OF THE LARGEST STOCKS
REPRESENTING APPROXIMATELY 87% OF THE U.S. EQUITY MARKET. AN INVESTOR CANNOT
INVEST DIRECTLY IN AN INDEX.

ADDITIONAL INVESTMENT RESULTS APPEAR ON PAGE 6.

ECONOMIC REVIEW
It seems that virtually every portfolio manager and market strategist has drawn
attention to the narrow leadership that has evolved in the market over the last
couple of years. In terms of high earnings growth and strong market positions,
it is hard to argue with the fundamentals behind most of these companies. But
the price-to-earnings multiple divergence between this select group and all
others is hard to fit into any historic experience, at least since the early
1970s.

An unintended consequence of this divergence of valuations is that it feeds on
itself because of the importance of the names in indices such as the Russell
1000 Growth Stock Index and the S&P 500. The Russell 1000 Growth Stock Index,
for example, is now approaching nearly a 50% weighting in highly valued
technology stocks. And by default, therefore, small-cap, mid-cap and value
areas suffer as funds are diverted to keeping up with the major benchmarks
irrespective of price considerations. We continue to be strong bulls on the
U.S. economy and most U.S. companies based on fundamentals. But it is hard to
swallow today's relative multiples between groups and, at the same time,
believe that the market is being completely rational. To pay very high absolute
and relative multiples for a narrow list of stocks presupposes that the

ALLIANCE INSTITUTIONAL FUNDS
_______________________________________________________________________________

rubber band in the future will stretch even further, and that what has been a
winning strategy up to this point will continue.

REVIEW OF INVESTMENT STRATEGY
The Fund seeks long-term growth by investing in many of the premier U.S.
companies that demonstrate world leadership positions. We are continuing to
stay the course with an optimistic bias, but remain extremely price conscious
when looking at one stock against another. Our own answer to the dilemma of the
divergence in values between the narrow leadership group and the broader market
is to adopt what admittedly some could say is a compromise position. We are not
as heavily invested in the growth favorites (such as technology) to the extent
that some benchmarks would dictate. We are continuing to run the Fund's
portfolio with a broad mix of stocks, and believe a middle road is the correct
path given our positive view of fundamentals but some discomfort with the
extremes of market price discrepancies. As always, we will continue to make
individual decisions as best we see based on the marriage of fundamentals and
price for all the stocks held by the Fund and at each point of the market's
gyrations.

ALLIANCE QUASAR INSTITUTIONAL FUND
Portfolio Manager: Randall Haase

The following table provides performance results for the Alliance Quasar
Institutional Fund (the "Fund") for the six- and 12-month periods ended October
31, 1999. For comparison, we have also included the returns for the Russell
2000 Index, which measures the performance of small-cap U.S. stocks.

INVESTMENT RESULTS
During the six- and 12-month periods ended October 31, 1999, the Fund's Class I
shares returned -5.15% and 6.88%, respectively, while the Fund's benchmark
index, as represented by the Russell 2000 Index, returned -0.25% and 14.87%,
respectively. The Fund's underperformance versus its benchmark was largely due
to the Fund's relative underweight position in technology as well as its
exposure to various other industries such as health care, retail and
transportation. We believe that these areas offer much better investments on a
risk/reward basis with much less volatility. Other than technology stocks, most
other areas of the U.S. market have received little investor interest. As a
result, we believe strongly that these areas are where the greatest
opportunities lie.

INVESTMENT RESULTS*
Periods ended October 31, 1999
TOTAL RETURNS
6 MONTHS 12 MONTHS
---------- -----------
ALLIANCE QUASAR INSTITUTIONAL FUND
Class I -5.15% 6.88%
Class II -5.28% 6.76%

RUSSELL 2000 INDEX -0.25% 14.87%

THE RUSSELL 2000 INDEX IS A CAPITALIZATION-WEIGHTED INDEX THAT INCLUDES
2,000 OF THE SMALLEST STOCKS REPRESENTING APPROXIMATELY 11% OF THE U.S. EQUITY
MARKET. AN INVESTOR CANNOT INVEST DIRECTLY IN AN INDEX.

ADDITIONAL INVESTMENT RESULTS APPEAR ON PAGE 8.

MARKET REVIEW
Overall, small-cap stocks continue to underperform large-cap stocks. In fact,
if this trend continues, 1999 will mark the sixth consecutive year of
underperformance for small-cap stocks as measured by the Russell 2000 Index
relative to the Standard & Poor's 500 Stock Index ("S&P 500"). We strongly
believe this six-year cycle is a liquidity-driven event. Since 1979, when the
Russell 2000 Index was introduced to measure small-cap stocks, there have been
four distinct cycles in which either small- or large-cap stocks performed well.
For 1999, not only have we just completed six consecutive years, but also the
disparity in valuations between small- and large-cap stocks has never been more
extreme within this 20-year period. In fact, since the beginning of 1994, when
the current period of underperformance for small-cap stocks began, the S&P 500
has outperformed the Russell 2000 Index by practically a two-to-one margin, or
approximately 26% versus 13% on an annualized basis for the six-year period. In
our view, this is simply not sustainable.

ALLIANCE INSTITUTIONAL FUNDS
_______________________________________________________________________________

We do strongly believe that there are major opportunities to invest in the U.S.
in literally thousands of small-cap stocks that offer much better risk/reward
tradeoffs than many investors realize. The difficulty, of course, is in
determining exactly when investor psychology will change. When it does,
however, we believe that the Fund is positioned to do well when the market
broadens out and small-cap stocks start to participate.

For example, the Fund holds several positions in the retail and apparel
sectors. The companies in these sectors typically have strong franchises,
dominant market share positions, earnings-per-share growth between 20% and 30%
and price-to-earnings ratios between 10 and 20 times earnings. The Fund's
holdings in these sectors include Zale Corporation, a leading jewelry retailer,
Men's Wearhouse Inc., a leading men's retailer of formal wear, and BJ's
Wholesale Club Inc., a leading membership-based warehouse club chain.

Within the leisure category, we are looking for professionally managed
consolidators of fragmented industries who are able to leverage their strengths
in building dominant, national franchises. These include Bally Total Fitness
Holding Corp., which, with over four million members, is the largest health
club provider in the U.S., and Premier Parks Inc., the largest amusement park
operator after the Walt Disney Company. In the consumer manufacturing category,
the Fund maintains a holding in Monaco Coach Corp., a leading manufacturer of
recreational vehicles in the U.S.

Health care continues to be an area of focus for the Fund. The congressional
balancing of the federal budget and various managed-care concerns have put a
lot of pressure on the health care service sector, which in turn has depressed
stock prices in this sector. Nevertheless, we have used this as an opportunity
to add to the Fund's holdings. These include Health Management Associates Inc.,
a leading operator of acute care hospitals in rural markets, and Lifepoint
Hospitals Inc., a recently spun-out company from Columbia/HCA Healthcare Corp.
In addition, the Fund holds a position in Medical Manager Corp., an intranet
health care company focusing on managing drug prescriptions via a closed-loop
architecture.

In the turnaround category, we believe that the sports retailing industry has
seen its worst days and that Venator Group Inc., the parent company of both
Foot Locker and Champs, should benefit. As the industry becomes more rational,
the aggressive expansion in square footage seen over the last five years has
essentially come to a halt. In addition, Nike Inc. is seeing its business
turning. These factors should help Foot Locker and Champs see a turn in their
business and we consequently believe that Venator should do very well.

Within the real estate sector, we believe that the stocks of real estate
investment trusts ("REITs") have come under a lot of pressure as investors
focus more on momentum growth and less on yield. There are several well-run
companies yielding over 10% with internal growth of 10% to 20%. Therefore, we
have about 7% of the Fund's portfolio invested in REITs and currently hold
positions in Chelsea GCA Realty Inc. Taubman Centers Inc. and MeriStar
Hospitality Corp.

In addition, we also like the rental car industry and have positions in Budget
Group Inc. and Dollar Thrifty Automotive Group Inc. This industry has gone
through a major change in ownership from the auto manufacturers to financial
entrepreneurs. We are now seeing real pricing power, better yield management,
greater inventory efficiencies, and as a result, a higher level of
profitability. We believe these companies have strong fundamentals that are not
yet recognized in the marketplace.

We remain adverse to establishing an overweight position in the technology
sector and, more specifically, in internet stocks. We still believe that a
broad majority of these stocks have yet to demonstrate the ability to produce
significant earnings and, in some cases, we believe that they probably never
will. In our opinion, these stocks remain overpriced, and we therefore maintain
a low weighting in these sectors.

ALLIANCE REAL ESTATE INVESTMENT
INSTITUTIONAL FUND
Portfolio Manager: Dan Pine

The following table provides performance results for the Alliance Real Estate
Investment Institutional Fund (the "Fund") for the six- and 12-month periods
ended October 31, 1999. For comparison, we have also included the returns of
the National Association of Real Estate Investment Trusts ("NAREIT") Equity
Index, and the Standard & Poor's 500 Stock Index (the "S&P 500").

ALLIANCE INSTITUTIONAL FUNDS
_______________________________________________________________________________

INVESTMENT RESULTS
The shares of real estate companies continue to significantly underperform the
overall stock market. After a brief spring rally, the price of real estate
investment trust ("REIT") shares regressed back into a downtrend, which
originally began in late 1997. To date, the price decline has been about 33%,
peak to trough. Although these price declines have been somewhat offset by
dividends, the total returns have nonetheless been clearly negative. As the
accompanying table highlights, the past six months have been particularly
difficult, with the NAREIT Equity Index losing 8.36% during this brief period.
It was a particularly difficult period for the Fund, which underperformed its
benchmark during the six-month period ended October 31, 1999. This
underperformance more than offset our relative outperformance of the prior six
months, leaving the Fund behind its benchmark for the fiscal year.

There is no single event or sub-sector dislocation that can explain the Fund's
low returns over the past six months. A number of the Fund's portfolio
investments declined precipitously in price during this period. Among the
companies hardest hit were those with the highest dividend yields and lowest
valuations going into the period. This occurred regardless of geographic or
property type exposure.

INVESTMENT RESULTS*
Periods ended October 31, 1999
TOTAL RETURNS
6 MONTHS 12 MONTHS
---------- -----------
ALLIANCE REAL ESTATE INVESTMENT
INSTITUTIONAL FUND
Class I -11.32% -7.21%
Class II -11.29% -7.32%

S&P 500 2.74% 25.66%

NAREIT EQUITY INDEX -8.36% -5.54%

* THE FUND'S INVESTMENT RESULTS REPRESENT TOTAL RETURNS AND ARE BASED ON
THE NET ASSET VALUE OF EACH CLASS OF SHARES AS OF OCTOBER 31, 1999. ALL FEES
AND EXPENSES RELATED TO THE OPERATION OF THE FUND HAVE BEEN DEDUCTED. PAST
PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.

THE S&P 500 IS AN UNMANAGED INDEX OF 500 U.S. COMPANIES, AND IS A COMMON
MEASURE OF THE PERFORMANCE OF THE OVERALL U.S. STOCK MARKET. THE NAREIT EQUITY
INDEX IS A MARKET VALUE WEIGHTED INDEX BASED UPON THE LAST CLOSING PRICE OF THE
MONTH FOR TAX-QUALIFIED REITS LISTED ON THE NYSE, AMEX, AND NASDAQ. INDEX
RETURNS ARE NOT ADJUSTED FOR SALES CHARGES OR OPERATING EXPENSES. AN INVESTOR
CANNOT INVEST DIRECTLY IN AN INDEX.

ADDITIONAL INVESTMENT RESULTS APPEAR ON PAGE 10.

MARKET OVERVIEW
Despite of the aforementioned stock price performance, our expectations for the
real estate sector continue to be positive. Across the vast majority of
geographic markets and property types, buildings are full, rents are increasing
above inflation and new construction levels remain benign. Companies are
meeting or exceeding estimates for growth, and dividends are well covered and
increasing. In short, we believe that fundamentals are in place for continued
moderate improvements in operating results, albeit at rates of growth below
those of the recent past.

Stock prices, as previously mentioned, have declined to levels well below prior
peaks. In fact, REITs today trade at prices last seen in 1995 in spite of
double digit cash flow growth in each of the ensuing years. REITs are cheaper
today than at any time since the rebirth of the industry in the early years of
this decade. This holds true using any valuation metric - price-to-cash-flow,
discounts to underlying asset value, dividend yields, price-to-earnings to
growth, or yields relative to other income vehicles.

Yet despite this value equation, investor sentiment remains quite negative. In
our view, this is because the ongoing market surge and strong economy have left
investors more risk-tolerant than in the recent past. Across many sectors of
the market, cash has flowed to higher-risk, higher-return investments. This is
especially true for the high excitement areas of the "new" economy - the
Internet and related products and services. The valuation bubble thus created
may be unprecedented in the history of the U.S. economy. It has certainly
drained capital and investor interest from many other investment alternatives.
REITs are in no way part of this new economy. They may not be hurt by the
growth of the Internet

ALLIANCE INSTITUTIONAL FUNDS
_______________________________________________________________________________

(with the possible exception of retail property owners), but they do not
benefit from it and they are not part of the related run-up in stock price.

We believe that REITs, along with many other sectors of the market, will
continue to suffer a dearth of investor interest until the broad market
investor experiences some need to be more conservative. Unfortunately, we know
neither when this will occur nor what will cause this to happen. It may be
because the Internet bubble pops, or it may be because the valuation dichotomy
in the market simply reaches unsustainable levels. We do not know. However, we
do believe that, in the interim, REITs will likely continue to pay out generous
dividends and grow the value of the assets they own.

INVESTMENT STRATEGY
Your Fund has always been diversified across all the many types of
income-producing real estate, with the bulk of its investments in markets and
property types showing better-than-average expected growth. As the REIT market
declined over the past several quarters, we sought to ameliorate the risks by
increasing our exposure to assets with less cyclical risk than average as well
as those with exposure to the strongest local markets.

Frankly, the lower risk diversification hasn't worked. Most of these companies
have underperformed the REIT market because they could not attract growth
capital. We are currently refocusing the Fund's portfolio on those companies
with the best growth prospects because they own assets in the best real estate
markets. These include companies with significant exposure to markets along the
coasts and less exposure to the heartland. This will also serve to shrink the
number of holdings of the Fund and add to the benefits we expect to realize.

MARKET OUTLOOK AND CONCLUSION
We remain optimistic about the future of real estate. The markets are healthy,
and moderate growth in rents appear sustainable. In our view, the shares of
real estate companies discount a reality far worse than any we are likely to
encounter, and few investors care. We believe this combination of factors makes
real estate stocks attractive at this time.

In conclusion, we would like to thank you for the continued confidence you have
shown in the portfolios of Alliance Institutional Funds, Inc., and we look
forward to reporting their progress to you in the future.

Sincerely,

Alfred Harrison
Executive Vice President

Randall E. Haase
Senior Vice President

Daniel G. Pine
Senior Vice President

SHARES OF THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF, GUARANTEED OR ENDORSED
BY, ANY BANK; FURTHER, SUCH SHARES ARE NOT FEDERALLY INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER AGENCY.
SHARES OF THE FUND INVOLVE INVESTMENT RISKS, INCLUDING THE POSSIBLE LOSS OF
PRINCIPAL.

INVESTMENT OBJECTIVE AND POLICIES
ALLIANCE PREMIER GROWTH INSTITUTIONAL FUND
_______________________________________________________________________________

Alliance Premier Growth Institutional Fund is an open-end, diversified
investment company that seeks long-term growth of capital by investing in the
common stocks of a limited number of large, carefully selected, high quality
U.S. companies that are judged likely to achieve superior earnings growth.
Normally, about 40 companies will be represented in the portfolio, with the 25
most highly regarded of these usually constituting 70% of the Fund's net assets.

INVESTMENT RESULTS
_______________________________________________________________________________

AVERAGE ANNUAL TOTAL RETURNS
CLASS I SHARES
PERIOD ENDED PERIOD ENDED
OCTOBER 31, SEPTEMBER 30,
1999 1999
------------ ------------
12 Months 39.17% 41.90%
Since Inception* 36.27% 32.45%

CLASS II SHARES
PERIOD ENDED PERIOD ENDED
OCTOBER 31, SEPTEMBER 30,
1999 1999
------------ ------------
12 Months 38.63% 41.30%
Since Inception* 35.74% 31.93%

The Fund's investment results represent average annual total returns. The
returns reflect reinvestment of dividends and/or capital gains distributions in
additional shares.

Past performance does not guarantee future results. Investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than their original cost.

* Inception: 1/7/98 Class I & Class II.

ALLIANCE PREMIER GROWTH INSTITUTIONAL FUND
_______________________________________________________________________________

ALLIANCE PREMIER GROWTH INSTITUTIONAL FUND
GROWTH OF A $10,000 INVESTMENT
1/31/98* TO 10/31/99

$17,000
$16,000
$15,000
$14,000
$13,000
$12,000
$11,000
$10,000

ALLIANCE PREMIER GROWTH INSTITUTIONAL FUND CLASS I: $16,600
RUSSELL 1000 GROWTH INDEX: $15,413
S&P 500 STOCK INDEX: $14,250

1/31/98 10/31/98 10/31/99

This chart illustrates the total value of an assumed $10,000 investment in
Alliance Premier Growth Institutional Fund Class I shares (from 1/31/98 to
10/31/99) as compared to the performance of appropriate broad-based indices.
The chart assumes the reinvestment of dividends and capital gains. Performance
for Class II shares will vary from the results shown above due to differences
in expenses charged to that class. Past performance is not indicative of future
results, and is not representative of future gain or loss in capital value or
dividend income.

The unmanaged Standard &Poor's 500 Stock Index includes 500 U.S. stocks and is
a common measure of the performance of the overall U.S. stock market.

The unmanaged Russell 1000Growth Index contains those securities in the Russell
1000 Stock Index with a greater-than-average growth orientation. The unmanaged
Russell 1000 Stock Index is comprised of 1000 of the largest capitalized
companies that are traded in the United States.

Alliance Premier Growth Institutional Fund
Standard &Poor's 500 StockIndex
Russell 1000Growth Index

* Closest month-end after the Fund's Class A share inception date of 1/7/98.

INVESTMENT OBJECTIVE AND POLICIES ALLIANCE QUASAR INSTITUTIONAL FUND
_______________________________________________________________________________

Alliance Quasar Institutional Fund seeks growth of capital by pursuing
aggressive investment policies. Alliance Quasar Institutional Fund invests
primarily in a diversified portfolio of equity securities of any company and
industry and in any type of security which is believed to offer possibilities
for capital appreciation.

INVESTMENT RESULTS
_______________________________________________________________________________

AVERAGE ANNUAL TOTAL RETURNS
CLASS I SHARES
PERIOD ENDED PERIOD ENDED
OCTOBER 31, SEPTEMBER 30,
1999 1999
------------ ------------
12 Months 6.88% 11.48%
Since Inception* -13.26% -13.69%

CLASS II SHARES
PERIOD ENDED PERIOD ENDED
OCTOBER 31, SEPTEMBER 30,
1999 1999
------------ ------------
12 Months 6.76% 11.20%
Since Inception* -13.46% -13.91%

The Fund's investment results represent average annual total returns. The
returns reflect reinvestment of dividends and/or capital gains distributions in
additional shares.

* Inception: 3/17/98 Class I & Class II.

ALLIANCE QUASAR INSTITUTIONAL FUND
_______________________________________________________________________________

ALLIANCE QUASAR INSTITUTIONAL FUND
GROWTH OF A $10,000 INVESTMENT
3/31/98* TO 10/31/99

$13,000
$12,000
$11,000
$10,000
$9,000
$8,000
$7,000

S&P 500 STOCK INDEX: $12,644
RUSSELL 2000 INDEX: $9,102
ALLIANCE QUASAR INSTITUTIONAL FUND CLASS I: $7,868

3/31/98 10/31/98 10/31/99

This chart illustrates the total value of an assumed $10,000 investment in
Alliance Quasar Institutional Fund Class I shares (from 3/31/98 to 10/31/99) as
compared to the performance of appropriate broad-based indices. The chart
assumes the reinvestment of dividends and capital gains. Performance for Class
II shares will vary from the results shown above due to differences in expenses
charged to that class. Past performance is not indicative of future results,
and is not representative of future gain or loss in capital value or dividend
income.

The unmanaged Standard &Poor's 500 Stock Index includes 500 U.S. stocks and is
a common measure of the performance of the overall U.S. stock market.

The unmanaged Russell 2000 Index is a capitalization-weighted index that
includes 2,000 of the smallest stocks representing approximately 11% of the
U.S. equity market.

Alliance Quasar Institutional Fund
Standard &Poor's 500 StockIndex
Russell 2000Index

* Closest month-end after the Fund's Class A share inception date of 3/17/98.

ALLIANCE REAL ESTATE INVESTMENT
INVESTMENT OBJECTIVE AND POLICIES INSTITUTIONAL FUND
_______________________________________________________________________________

Alliance Real Estate Institutional Fund seeks a total return on its assets from
long-term growth of capital and from income principally through investing in a
portfolio of equity securities of issuers that are primarily engaged in or
related to the real estate industry.

INVESTMENT RESULTS
_______________________________________________________________________________

AVERAGE ANNUAL TOTAL RETURNS
CLASS I SHARES
PERIOD ENDED PERIOD ENDED
OCTOBER 31, SEPTEMBER 30,
1999 1999
------------ ------------
12 Months -7.21% -6.46%
Since Inception* -13.81% -12.77%

CLASS II SHARES
PERIOD ENDED PERIOD ENDED
OCTOBER 31, SEPTEMBER 30,
1999 1999
------------ ------------
12 Months -7.32% -6.71%
Since Inception* -14.09% -13.14%

The Fund's investment results represent average annual total returns. The
returns reflect reinvestment of dividends and/or capital gains distributions in
additional shares.

* Inception: 12/9/97 Class I & Class II

ALLIANCE REAL ESTATE INVESTMENT
INSTITUTIONAL FUND
_______________________________________________________________________________

ALLIANCE REALESTATE INVESTMENT INSTITUTIONAL FUND
GROWTH OF A $10,000 INVESTMENT
12/31/97* TO 10/31/99

$15,000
$13,000
$11,000
$10,000
$9,000
$7,000

S&P 500 STOCKINDEX: $14,407
NAREITEQUITY INDEX: $7,878
ALLIANCE REAL ESTATE INVESTMENT INSTITUTIONAL FUND CLASS I: $7,440

12/31/97 10/31/98 10/31/99

This chart illustrates the total value of an assumed $10,000 investment in
Alliance RealEstate Investment Institutional Fund Class I shares (from 12/31/97
to 10/31/99) as compared to the performance of appropriate broad-based indices.
The chart assumes the reinvestment of dividends and capital gains. Performance
for Class II shares will vary from the results shown above due to differences
in expenses charged to that class. Past performance is not indicative of future
results, and is not representative of future gain or loss in capital value or
dividend income.

The unmanaged Standard &Poor's 500 Stock Index includes 500 U.S. stocks and is
a common measure of the performance of the overall U.S. stock market.
The unmanaged NAREITEquity Index is a market-value weighted index, based upon
the last closing price of the month for tax-qualified REITs listed on NYSE,
AMEX and the NASDAQ.

Alliance Real Estate Investment Institutional Fund
Standard &Poor's 500 StockIndex
NAREITEquityIndex

* Closest month-end after the Fund's Class A share inception date of 12/9/97.

TEN LARGEST HOLDINGS
OCTOBER 31, 1999 ALLIANCE PREMIER GROWTH INSTITUTIONAL FUND
_______________________________________________________________________________

PERCENT OF
COMPANY VALUE NET ASSETS
- -------------------------------------------------------------------------------
Dell Computer Corp. $11,840,887 4.6%
Home Depot, Inc. 10,894,650 4.3
Morgan Stanley Dean Witter & Co. 10,363,860 4.1
Cisco Systems, Inc. 9,842,000 3.8
Nokia Corp. (ADR) 8,412,950 3.3
Intel Corp. 8,007,038 3.1
Schering-Plough Corp. 7,840,800 3.1
Federal Home Loan Mortgage Corp. 7,785,000 3.1
Warner-Lambert Co. 7,566,225 3.0
MBNA Corp. 7,498,806 2.9
$90,052,216 35.3%

MAJOR PORTFOLIO CHANGES
SIX MONTHS ENDED OCTOBER 31, 1999
_______________________________________________________________________________

SHARES*
- -------------------------------------------------------------------------------
HOLDINGS
PURCHASES BOUGHT 10/31/99
- -------------------------------------------------------------------------------
Citigroup, Inc. 115,150 129,450
Dell Computer Corp. 132,900 295,100
Gap, Inc. 127,350 184,450
Goldman Sachs Group, Inc. 60,100 60,100
Home Depot, Inc. 66,900 144,300
MBNA Corp. 140,300 271,450
MediaOne Group, Inc. 76,100 104,500
Morgan Stanley Dean Witter & Co. 48,400 93,950
Philip Morris Cos., Inc. 152,700 279,800
Schering-Plough Corp. 94,700 158,400

HOLDINGS
SALES SOLD 10/31/99
- -------------------------------------------------------------------------------
AirTouch Communications, Inc. 47,400 -0-
Applied Materials, Inc. 7,200 -0-
BankAmerica Corp. 2,500 -0-
Gillette Co. 12,600 -0-
McKesson HBOC, Inc. 100,260 -0-
Merrill Lynch & Co., Inc. 800 12,100
Micron Technology, Inc. 25,200 -0-
Nokia Corp. (ADR) 19,400 72,800
Waste Management, Inc. 19,400 -0-

* Adjusted for stock splits.

TEN LARGEST HOLDINGS
OCTOBER 31, 1999 ALLIANCE QUASAR INSTITUTIONAL FUND
_______________________________________________________________________________

PERCENT OF
COMPANY VALUE NET ASSETS
- -------------------------------------------------------------------------------
Legg Mason, Inc. $ 1,553,213 5.0%
Chelsea GCA Realty, Inc. 1,305,100 4.2
Premier Parks, Inc. 1,116,987 3.6
Mohawk Industries, Inc. 984,019 3.1
Health Management Associates, Inc. Cl.A 871,525 2.8
Monaco Coach Corp. 811,619 2.6
Venator Group, Inc. 753,900 2.4
BJ'S Wholesale Club, Inc. 736,419 2.4
Zale Corp. 728,625 2.3
LifePoint Hospitals, Inc. 678,037 2.2
$ 9,539,444 30.6%

MAJOR PORTFOLIO CHANGES
SIX MONTHS ENDED OCTOBER 31, 1999
_______________________________________________________________________________

SHARES*
- -------------------------------------------------------------------------------
HOLDINGS
PURCHASES BOUGHT 10/31/99
- -------------------------------------------------------------------------------
Calpine Corp. 8,600 8,600
Ensco International, Inc. 14,600 14,600
Entercom Communications Corp. 8,800 8,800
Health Management Associates, Inc. Cl.A 98,200 98,200
IDEC Pharmaceuticals Corp. 3,700 3,700
K-Swiss, Inc. Cl.A 7,200 7,200
LifePoint Hospitals, Inc. 57,400 57,400
Murphy Oil Corp. 5,100 5,100
ShopKo Stores, Inc. 14,000 14,000
Summit Technology, Inc. 17,400 17,400

HOLDINGS
SALES SOLD 10/31/99
- -------------------------------------------------------------------------------
Alaska Air Group, Inc. 8,100 15,400
Bally Total Fitness Holding Corp. 13,100 10,000
Bethlehem Steel Corp. 70,400 -0-
GelTex Pharmaceuticals, Inc. 24,800 -0-
Human Genome Sciences, Inc. 7,200 -0-
Pinnacle Holdings, Inc. 23,900 -0-
Republic Services, Inc. 20,300 -0-
St. Jude Medical, Inc. 9,200 -0-
Tiffany & Co. 15,500 -0-
Tommy Hilfiger Corp. 4,500 -0-

* Adjusted for stock splits.

TEN LARGEST HOLDINGS ALLIANCE REAL ESTATE INVESTMENT
OCTOBER 31, 1999 INSTITUTIONAL FUND
_______________________________________________________________________________

PERCENT OF
COMPANY VALUE NET ASSETS
- -------------------------------------------------------------------------------
Equity Office Properties Trust $ 61,950 5.4%
Vornado Realty Trust 53,868 4.7
Boston Properties, Inc. 53,662 4.7
ProLogis Trust 52,144 4.5
Pan Pacific Retail Properties, Inc. 51,100 4.5
Public Storage, Inc. 50,663 4.4
Apartment Investment & Management Co. 48,913 4.3
Brookfield Properties Corp. 48,656 4.2
Reckson Associates Realty Corp. 42,550 3.7
SL Green Realty Corp. 40,013 3.5
$ 503,519 43.9%

MAJOR PORTFOLIO CHANGES
SIX MONTHS ENDED OCTOBER 31, 1999
_______________________________________________________________________________

SHARES
- -------------------------------------------------------------------------------
HOLDINGS
PURCHASES BOUGHT 10/31/99
- -------------------------------------------------------------------------------
Alexandria Real Estate Equities, Inc. 900 900
AMB Property Corp. 900 900
Hospitality Properties Trust 1,200 1,200
Mission West Properties, Inc. 1,200 1,200

HOLDINGS
SALES SOLD 10/31/99
- -------------------------------------------------------------------------------
Arden Realty Group, Inc. 13,900 1,500
AvalonBay Communities, Inc. 10,800 1,200
Brookfield Properties Corp. 29,900 4,500
Equity Office Properties Trust 16,300 2,800
Glenborough Realty Trust, Inc. 19,900 1,500
Pan Pacific Retail Properties, Inc. 21,700 2,800
ProLogis Trust 15,000 2,700
Public Storage, Inc. 13,300 2,100
SL Green Realty Corp. 17,400 2,200
Vornado Realty Trust 8,900 1,700

PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1999 ALLIANCE PREMIER GROWTH INSTITUTIONAL FUND
_______________________________________________________________________________

COMPANY SHARES VALUE
- -------------------------------------------------------------------------
COMMON STOCKS-98.5%
CONSUMER SERVICES-27.4%
AIRLINES-3.4%
Continental Airlines, Inc.
C1.B (a) 70,800 $ 2,867,400
Delta Air Lines, Inc. 28,600 1,556,912
KLM Royal Dutch Air 56,933 1,533,633
Northwest Airlines Corp. (a) 46,000 1,164,375
UAL Corp. (a) 23,600 1,606,275
------------
8,728,595

BROADCASTING & CABLE-7.3%
AMFM, Inc. (a) 33,800 2,366,000
AT&T Corp.-Liberty Media
Group (a) 103,200 4,095,750
Clear Channel
Communications (a) 22,200 1,784,325
MediaOne Group, Inc. (a) 104,500 7,426,031
Vodafone AirTouch Plc 58,600 2,809,138
------------
18,481,244

PRINTING & PUBLISHING-0.2%
Gannett Co., Inc. 7,700 593,862

RESTAURANTS & LODGING-0.2%
Starbucks Corp. (a) 17,600 478,500

RETAIL-GENERAL MERCHANDISE-16.3%
Costco Wholesale Corp. (a) 65,300 5,244,406
Dayton Hudson Corp. 35,900 2,320,038
Gap, Inc. 184,450 6,847,706
Home Depot, Inc. 144,300 10,894,650
Kohl's Corp. (a) 46,200 3,456,337
Lowes Cos., Inc. 115,800 6,369,000
Tommy Hilfiger Corp. (a) 63,400 1,791,050
Wal-Mart Stores, Inc. 80,900 4,586,019
------------
41,509,206
------------
69,791,407

TECHNOLOGY-24.0%
COMMUNICATION EQUIPMENT-6.6%
EMC Corp. (a) 81,700 5,964,100
Lucent Technologies, Inc. 39,160 2,516,030
Nokia Corp. (ADR) (Finland) 72,800 8,412,950
------------
16,893,080

COMPUTER HARDWARE-5.7%
Dell Computer Corp. (a) 295,100 11,840,887
International Business
Machines Corp. 24,500 2,410,188
Sun Microsystems, Inc. (a) 3,700 391,506
------------
14,642,581

COMPUTER SOFTWARE-1.8%
Microsoft Corp. (a) 50,500 4,674,406

INTERNET SOFTWARE-0.9%
America Online, Inc. 16,800 2,178,750

NETWORKING SOFTWARE-3.9%
Cisco Systems, Inc. (a) 133,000 9,842,000

SEMI-CONDUCTOR COMPONENTS-4.2%
Intel Corp. 103,400 8,007,038
Texas Instruments, Inc. 31,500 2,827,125
------------
10,834,163

MISCELLANEOUS-0.9%
Solectron Corp. (a) 30,300 2,280,075
------------
61,345,055

FINANCE-20.8%
BANKING-MONEY CENTERS-4.2%
Chase Manhattan Corp. 41,400 3,617,325
Citigroup, Inc. 129,450 7,006,481
------------
10,623,806

BANKING-REGIONAL-0.5%
Fifth Third Bancorp 16,700 1,232,669

BROKERAGE & MONEY MANAGEMENT-6.5%
Charles Schwab Corp. 28,000 1,090,250
Goldman Sachs Group, Inc. 60,100 4,267,100
Merrill Lynch & Co., Inc. 12,100 949,850
Morgan Stanley Dean Witter
& Co. 93,950 10,363,860
------------
16,671,060

INSURANCE-1.4%
American International
Group, Inc. 35,375 3,641,414

MORTGAGE BANKING-3.0%
Federal Home Loan Mortgage
Corp. 144,000 7,785,000

PORTFOLIO OF INVESTMENTS (CONTINUED)
ALLIANCE PREMIER GROWTH INSTITUTIONAL FUND
_______________________________________________________________________________

SHARES OR
PRINCIPAL
AMOUNT
COMPANY (000) VALUE
- -------------------------------------------------------------------------
MISCELLANEOUS-5.2%
Associates First Capital Corp.
Cl.A 85,376 $ 3,116,224
MBNA Corp. 271,450 7,498,806
Newcourt Credit Group, Inc. 109,800 1,804,837
The CIT Group, Inc. 30,700 732,963
------------
13,152,830
------------
53,106,779

HEALTH CARE-11.9%
DRUGS-9.8%
Bristol-Myers Squibb Co. 49,100 3,771,494
Pfizer, Inc. 149,000 5,885,500
Schering-Plough Corp. 158,400 7,840,800
Warner-Lambert Co. 94,800 7,566,225
------------
25,064,019

MEDICAL SERVICES-2.1%
Cardinal Health, Inc. 42,100 1,815,562
IMS Health, Inc. 116,300 3,372,700
------------
5,188,262
------------
30,252,281

CONSUMER STAPLES-5.3%
RETAIL -FOOD & DRUGS-2.5%
Kroger Co. (a) 125,000 2,601,562
Safeway, Inc. (a) 54,400 1,921,000
Walgreen Co. 79,300 1,997,369
------------
6,519,931

TOBACCO-2.8%
Philip Morris Cos., Inc. 279,800 7,047,463
------------
13,567,394

MULTI-INDUSTRY COMPANY-2.9%
Tyco International Ltd. 187,742 7,497,946

UTILITIES-2.7%
TELEPHONE UTILITY-2.7%
MCI WorldCom, Inc. (a) 76,300 6,547,494
Sprint Corp. 4,900 364,131
------------
6,911,625

ENERGY-1.5%
DOMESTIC INTEGRATED-1.5%
Atlantic Richfield Co. 41,600 3,876,600

CAPITAL GOODS-1.0%
MISCELLANEOUS-1.0%
United Technologies Corp. 41,300 2,498,650

CONSUMER MANUFACTURING-1.0%
AUTO & RELATED-0.8%
Ford Motor Co. 36,200 1,986,475

BUILDING & RELATED-0.2%
Masco Corp. 16,600 506,300
------------
2,492,775

Total Common Stocks
(cost $231,048,339) 251,340,512

SHORT-TERM INVESTMENTS-1.1%
COMMERCIAL PAPER-1.1%
General Electric Capital Corp.
5.30%, 11/01/99
(amortized cost $2,700,000) $2,700 2,700,000

TOTAL INVESTMENTS-99.6%
(cost $233,748,339) 254,040,512
Other assets less
liabilities-0.4% 1,018,621

NET ASSETS-100% $ 255,059,133

(a) Non-income producing security.

Glossary:
ADR - American Depositary Receipt

See notes to financial statements.

PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1999 ALLIANCE QUASAR INSTITUTIONAL FUND
_______________________________________________________________________________

COMPANY SHARES VALUE
- -------------------------------------------------------------------------
COMMON STOCKS-94.6%
CONSUMER SERVICES-30.7%
AIRLINES-3.4%
Alaska Air Group, Inc. (a) 15,400 $ 612,150
America West Holdings Corp.
Cl.B (a) 21,400 442,712
------------
1,054,862

APPAREL-2.3%
Men's Wearhouse, Inc. (a) 20,800 456,300
Stage Stores, Inc. (a) 52,200 251,213
------------
707,513

BROADCASTING & CABLE-1.4%
Entercom Communications
Corp. (a) 8,800 438,350

ENTERTAINMENT & LEISURE-10.7%
Ackerley Group, Inc. 11,300 188,569
Bally Total Fitness Holding
Corp. (a) 10,000 240,625
Cinar Corp. Cl.B (a) 19,700 342,287
Imax Corp. (a) 9,700 201,275
Premier Parks, Inc. (a) 38,600 1,116,987
SFX Entertainment, Inc.
Cl.A (a) 14,550 508,341
Sunterra Corp. (a) 45,300 453,000
Trans World Entertainment
Corp. (a) 29,200 302,950
------------
3,354,034

RETAIL-GENERAL MERCHANDISE-11.7%
BJ'S Wholesale Club,
Inc. (a) 23,900 736,419
Furniture Brands International,
Inc. (a) 5,700 110,437
Industrie Natuzzi SpA
(ADR) (Italy) 23,200 423,400
Linens 'n Things, Inc. (a) 3,000 119,250
Movado Group, Inc. 17,100 376,200
Sharper Image Corp. (a) 3,300 36,094
ShopKo Stores, Inc. 14,000 350,875
Venator Group, Inc. (a) 107,700 753,900
Zale Corp. (a) 17,400 728,625
------------
3,635,200

MISCELLANEOUS-1.2%
Century Business Services,
Inc. (a) 22,500 223,594
Insight Enterprises, Inc. (a) 4,200 156,975
------------
380,569
------------
9,570,528

TECHNOLOGY-15.6%
COMMUNICATION EQUIPMENT-0.8%
TeleSpectrum Worldwide,
Inc. (a) 61,300 252,862

COMPUTER HARDWARE-2.1%
Apex, Inc. (a) 37,950 645,150

COMPUTER PERIPHERALS-0.7%
Proxicom, Inc. (a) 2,800 214,900

COMPUTER SERVICES-1.9%
DBT Online, Inc. (a) 26,000 607,750

COMPUTER SOFTWARE-5.1%
Aspect Development,
Inc. (a) 5,800 205,175
BackWeb Technologies,
Ltd. (a) 7,300 153,756
Business Objects S.A.
(ADR) (a) (France) 2,300 165,600
Intertrust Technologies
Corp. (a) 200 10,900
InterWorld Corp. (a) 9,600 393,600
New Era of Networks, Inc. (a) 1,300 42,169
Sapient Corp. (a) 2,600 332,475
Visual Networks, Inc. (a) 6,600 274,725
------------
1,578,400

NETWORKING SOFTWARE-0.6%
MMC Networks, Inc. (a) 5,800 184,875

SEMI-CONDUCTOR CAPITAL EQUIPMENT-0.8%
MKS Instruments, Inc. (a) 11,800 247,800

PORTFOLIO OF INVESTMENTS (CONTINUED) ALLIANCE QUASAR INSTITUTIONAL FUND
_______________________________________________________________________________

COMPANY SHARES VALUE
- -------------------------------------------------------------------------
SEMI-CONDUCTOR COMPONENTS-2.2%
Fairchild Semiconductor
Corp. (a) 10,300 $ 260,075
MIPS Technologies, Inc. (a) 6,200 179,025
SDL, Inc. (a) 2,100 258,956
------------
698,056

MISCELLANEOUS-1.4%
DII Group, Inc. (a) 2,900 104,400
Excalibur Technologies
Corp. (a) 16,900 156,325
Security First Technologies
Corp. (a) 4,000 160,750
------------
421,475
------------
4,851,268

FINANCE-11.9%
BROKERAGE & MONEY MANAGEMENT-5.0%
Legg Mason, Inc. 42,700 1,553,213

REAL ESTATE-6.9%
Chelsea GCA Realty, Inc. 42,100 1,305,100
MeriStar Hospitality Corp. 17,700 284,306
Taubman Centers, Inc. 50,400 570,150
------------
2,159,556
------------
3,712,769

CONSUMER MANUFACTURING-9.9%
AUTO & RELATED-6.4%
Budget Group, Inc. Cl.A (a) 36,900 258,300
Circuit City Stores, Inc.-
CarMax Group (a) 62,400 171,600
Dollar Thrifty Automotive
Group, Inc. (a) 12,900 217,688
Group 1 Automotive, Inc. (a) 32,100 537,675
Monaco Coach Corp. (a) 34,537 811,619
------------
1,996,882

TEXTILE PRODUCTS-3.5%
K-Swiss, Inc. Cl.A 7,200 92,700
Mohawk Industries, Inc. (a) 42,900 984,019
------------
1,076,719
------------
3,073,601

HEALTH CARE-9.3%
BIOTECHNOLOGY-1.4%
IDEC Pharmaceuticals
Corp. (a) 3,700 429,894

MEDICAL PRODUCTS-0.9%
Summit Technology, Inc. (a) 17,400 270,787

MEDICAL SERVICES-7.0%
Health Management Associates,
Inc. Cl.A (a) 98,200 871,525
LifePoint Hospitals, Inc. (a) 57,400 678,037
Medical Manager Corp. (a) 6,100 305,763
Orthodontic Centers of
America, Inc. (a) 20,800 286,000
Women First HealthCare,
Inc. (a) 8,100 60,244
------------
2,201,569
------------
2,902,250

ENERGY-5.2%
DOMESTIC PRODUCERS-0.9%
Murphy Oil Corp. 5,100 285,919

OIL SERVICE-2.1%
Ensco International, Inc. 14,600 282,875
Global Marine, Inc. (a) 10,900 165,543
Santa Fe International Corp. 9,600 202,200
------------
650,618

PIPELINES-2.2%
Southern Union Co. 33,400 676,350
------------
1,612,887

TRANSPORTATION-4.1%
SHIPPING-1.2%
Teekay Shipping Corp. 24,700 370,500

TRUCKING-0.8%
Consolidated Freightways
Corp. (a) 31,600 248,850

MISCELLANEOUS-2.1%
Carey International, Inc. (a) 31,300 663,169
------------
1,282,519

UTILITIES-3.6%
ELECTRIC & GAS UTILITY-1.6%
Calpine Corp. (a) 8,600 495,575

TELEPHONE UTILITY-2.0%
Millicom International Cellular,
SA (a) (Luxembourg) 19,000 641,250
------------
1,136,825

CAPITAL GOODS-2.7%
MACHINERY-1.5%
United Rentals, Inc. (a) 25,600 476,800

ALLIANCE QUASAR INSTITUTIONAL FUND
_______________________________________________________________________________

SHARES OR
PRINCIPAL
AMOUNT
COMPANY (000) VALUE
- -------------------------------------------------------------------------
MISCELLANEOUS-1.2%
Applied Power, Inc. Cl.A 12,300 $ 357,469
------------
834,269

CONSUMER STAPLES-0.6%
RETAIL-FOOD & DRUG-0.1%
Whole Foods Market, Inc. (a) 1,300 44,200

MISCELLANEOUS-0.5%
FirstService Corp. (a) 13,700 154,981
------------
199,181

MULTI-INDUSTRY COMPANIES-0.6%
PROFESSIONAL SERVICES-0.6%
Korn/Ferry International (a) 8,500 189,125

BASIC INDUSTRIES-0.4%
CHEMICALS-0.4%
Lyondell Chemical Co. 10,600 128,525

TRANSPORTATION & SHIPPING-0.0%
AMERCO (a) 100 2,944
------------
131,469

CONSUMER PRODUCTS & SERVICES-0.0%
BUSINESS SERVICES-0.0%
Provant, Inc. (a) 200 3,525

Total Common Stocks
(cost $30,884,133) 29,500,216

SHORT-TERM DEBT SECURITIES-7.7%
Federal National
Mortgage Association
5.16%, 11/01/99
(amortized cost $2,400,000) $2,400 2,400,000

TOTAL INVESTMENTS-102.3%
(cost $33,284,133) 31,900,216
Other assets less
liabilities-(2.3%) (702,893)

NET ASSETS-100% $ 31,197,323

(a) Non-income producing security.

Glossary:
ADR - American Depositary Receipt

See notes to financial statements.

PORTFOLIO OF INVESTMENTS ALLIANCE REAL ESTATE INVESTMENT
OCTOBER 31, 1999 INSTITUTIONAL FUND
_______________________________________________________________________________

COMPANY SHARES VALUE
- -------------------------------------------------------------------------
COMMON STOCKS-99.9%
REAL ESTATE INVESTMENT TRUSTS-99.9%
APARTMENTS-10.2%
Apartment Investment &
Management Co. 1,300 $ 48,913
AvalonBay Communities, Inc. 1,200 38,775
Essex Property Trust, Inc. 900 29,306
------------
116,994

DIVERSIFIED & OTHERS-13.9%
Captec Net Lease Realty, Inc. 500 5,375
Correctional Properties Trust 1,700 22,419
Entertainment Properties Trust 2,000 28,125
Glenborough Realty Trust, Inc. 1,500 19,594
Golf Trust of America, Inc. 1,200 21,525
Mission West Properties, Inc. 1,200 9,225
Vornado Realty Trust 1,700 53,868
------------
160,131

HOTELS & RESTAURANTS-6.9%
Hospitality Properties Trust 1,200 25,350
Innkeepers USA Trust 2,100 18,113
MeriStar Hospitality Corp. 2,200 35,337
------------
78,800

MANUFACTURED HOME COMMUNITIES-2.2%
Sun Communities, Inc. 800 25,500

OFFICE-24.9%
Alexandria Real Estate
Equities, Inc. 900 25,875
Arden Realty Group, Inc. 1,500 30,188
Boston Properties, Inc. 1,800 53,662
Brookfield Properties
Corp. (Canada) 4,500 48,656
Crescent Real Estate
Equities Co. 1,500 25,031
Equity Office Properties Trust 2,800 61,950
SL Green Realty Corp. 2,200 40,013
------------
285,375

OFFICE-INDUSTRIAL MIX-12.6%
Brandywine Realty Trust 2,100 35,306
Highwoods Properties, Inc. 1,300 31,444
Reckson Associates Realty
Corp. 2,300 42,550
Spieker Properties, Inc. 1,000 34,937
------------
144,237

REGIONAL MALLS-6.4%
Macerich Co. 1,800 36,000
Mills Corp. 2,100 37,800
------------
73,800

SHOPPING CENTERS-8.8%
Pan Pacific Retail Properties,
Inc. 2,800 51,100
Prime Retail, Inc. 3,500 27,781
Regency Realty Corp. 1,100 21,794
------------
100,675

STORAGE-4.4%
Public Storage, Inc. 2,100 50,663

WAREHOUSE & INDUSTRIAL-9.6%
AMB Property Corp. 900 17,887
Cabot Industrial Trust 2,000 40,000
ProLogis Trust 2,700 52,144
------------
110,031

TOTAL INVESTMENTS-99.9%
(cost $1,189,129) 1,146,206
Other assets less
liabilities-0.1% 999

NET ASSETS-100% $ 1,147,205

See notes to financial statements.

STATEMENT OF ASSETS AND LIABILITIES
OCTOBER 31, 1999 ALLIANCE INSTITUTIONAL FUNDS
_______________________________________________________________________________

<TABLE>
<CAPTION>
REAL ESTATE
PREMIER GROWTH QUASAR INVESTMENT
INSTITUTIONAL INSTITUTIONAL INSTITUTIONAL
FUND FUND FUND
-------------- -------------- --------------
<S> <C> <C> <C>
ASSETS
Investments in securities, at value
(cost $233,748,339, $33,284,133, and
$1,189,129, respectively) $254,040,512 $ 31,900,216 $ 1,146,206
Cash 32,421 96,321 55,603
Receivable for investment securities sold 5,008,135 315,728 -0-
Receivable for capital stock sold 466,717 5,670 1,760
Interest and dividends receivable 82,583 1,389 1,653
Deferred organization expenses 46,618 49,338 45,498
Total assets 259,676,986 32,368,662 1,250,720

LIABILITIES
Payable for investment securities purchased 4,048,499 729,898 -0-
Payable for capital stock redeemed 257,689 322,471 15,328
Advisory fee payable 184,348 11,040 8,034
Distribution fee payable 1,836 608 -0-
Accrued expenses 125,481 107,322 80,153
Total liabilities 4,617,853 1,171,339 103,515

NET ASSETS $255,059,133 $ 31,197,323 $ 1,147,205

COMPOSITION OF NET ASSETS
Capital stock, at par $ 14,534 $ 3,943 $ 169
Additional paid-in capital 217,088,150 35,787,341 6,200,839
Accumulated net realized gain (loss) on
investments and foreign currency
transactions 17,664,276 (3,210,044) (5,010,880)
Net unrealized appreciation (depreciation)
of investments 20,292,173 (1,383,917) (42,923)
$255,059,133 $ 31,197,323 $ 1,147,205

CALCULATION OF MAXIMUM OFFERING PRICE
CLASS I SHARES
Net asset value, redemption and offering
price per share ($247,268,600/14,087,641,
$16,797,820/2,120,699 and $1,146,825/169,281
shares of capital stock issued and
outstanding, respectively) $17.55 $ 7.92 $ 6.77

CLASS II SHARES
Net asset value, redemption and offering
price per share ($7,790,533/446,653,
$14,399,503/1,822,484 and $380/56 shares
of capital stock issued and outstanding,
respectively) $17.44 $ 7.90 $ 6.79
</TABLE>

See notes to financial statements.

STATEMENT OF OPERATIONS
YEAR ENDED OCTOBER 31, 1999 ALLIANCE INSTITUTIONAL FUNDS
_______________________________________________________________________________

<TABLE>
<CAPTION>
REAL ESTATE
PREMIER GROWTH QUASAR INVESTMENT
INSTITUTIONAL INSTITUTIONAL INSTITUTIONAL
FUND FUND FUND
-------------- -------------- --------------
<S> <C> <C> <C>
INVESTMENT INCOME
Dividends (net of foreign taxes withheld of
$21,456, $2,841 and $1,215, respectively) $ 758,346 $ 221,671 $ 602,426
Interest 207,574 90,883 14,496
Total income 965,920 312,554 616,922

EXPENSES
Advisory fee 1,423,280 338,045 100,714
Distribution fee--Class II 15,834 7,735 -0-
Administrative 123,000 123,000 123,000
Custodian 108,081 131,563 97,325
Registration 58,708 28,729 21,421
Transfer agency 37,421 31,368 8,380
Audit and legal 36,252 12,012 9,338
Amortization of organization expenses 14,600 14,600 14,600
Printing 12,207 10,242 7,892
Directors' fees 6,000 9,000 10,000
Miscellaneous 3,769 4,724 3,201
Total expenses 1,839,152 711,018 395,871
Less: expenses waived and reimbursed by
adviser (see Note B) (537,087) (282,162) (283,965)
Net expenses 1,302,065 428,856 111,906
Net investment income (loss) (336,145) (116,302) 505,016

REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCY
TRANSACTIONS
Net realized gain (loss) on investment
transactions 18,918,502 (1,922,930) (4,772,656)
Net realized gain (loss) on foreign
currency transactions (26) -0- 1,105
Net change in unrealized appreciation/
depreciation of investments 15,084,878 2,066,292 3,984,322
Net gain (loss) on investments and
foreign currency transactions 34,003,354 143,362 (787,229)

NET INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS $ 33,667,209 $ 27,060 $ (282,213)
</TABLE>

See notes to financial statements.

STATEMENT OF CHANGES IN NET ASSETS ALLIANCE INSTITUTIONAL FUNDS
_______________________________________________________________________________

<TABLE>
<CAPTION>
PREMIER GROWTH QUASAR REAL ESTATE INVESTMENT
INSTITUTIONAL FUND INSTITUTIONAL FUND INSTITUTIONAL FUND
------------------------------ ------------------------------ ------------------------------
YEAR ENDED PERIOD ENDED YEAR ENDED PERIOD ENDED YEAR ENDED PERIOD ENDED
OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31,
1999 1998 (A) 1999 1998 (B) 1999 1998 (C)
-------------- -------------- -------------- -------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN
NET ASSETS FROM
OPERATIONS
Net investment income (loss) $ (336,145) $ 16,136 $ (116,302) $ 2,356 $ 505,016 $ 697,160
Net realized gain (loss) on
investments and foreign
currency transactions 18,918,476 (887,491) (1,922,930) (1,287,114) (4,771,551) (324,943)
Net change in unrealized
appreciation/depreciation
of investments 15,084,878 5,207,295 2,066,292 (3,450,209) 3,984,322 (4,027,245)
Net increase (decrease) in
net assets from operations 33,667,209 4,335,940 27,060 (4,734,967) (282,213) (3,655,028)

DIVIDENDS TO
SHAREHOLDERS FROM:
Net investment income
Class I (46,397) -0- (1,770) -0- (504,998) (655,108)
Class II -0- -0- -0- -0- (18) (13)
Distributions in excess of
net investment income
Class I -0- -0- (24,626) -0- (69,087) -0-
Class II -0- -0- -0- -0- (2) -0-
Tax return of capital
Class I -0- -0- -0- -0- (58,749) -0-
Class II -0- -0- -0- -0- (2) -0-

CAPITAL STOCK
TRANSACTIONS
Net increase (decrease) 161,530,011 55,539,040 10,683,631 25,214,665 (16,131,069) 22,470,152
Total increase (decrease) 195,150,823 59,874,980 10,684,295 20,479,698 (17,046,138) 18,160,003

NET ASSETS
Beginning of period 59,908,310 33,330 20,513,028 33,330 18,193,343 33,340
End of period (including
undistributed net investment
income of $0, $16,136 and $0,
$2,356 and $0, $40,785,
respectively) $255,059,133 $ 59,908,310 $ 31,197,323
$ 20,513,028 $ 1,147,205 $ 18,193,343
</TABLE>

(a) Commencement of operations, January 7, 1998.

(b) Commencement of operations, March 17, 1998.

See notes to financial statements.

NOTES TO FINANCIAL STATEMENTS
OCTOBER 31, 1999 ALLIANCE INSTITUTIONAL FUNDS
_______________________________________________________________________________

NOTE A: SIGNIFICANT ACCOUNTING POLICIES
Alliance Institutional Funds, Inc. (the "Company") was organized as a Maryland
corporation on October 3, 1997 and is registered under the Investment Company
Act of 1940 as an open-end series investment company. The Company is comprised
of three funds, Alliance Premier Growth Institutional Fund, Alliance Quasar
Institutional Fund and Alliance Real Estate Investment Institutional Fund (the
"Funds"). Each Fund has different investment objectives and policies. Prior to
the commencement of operations on January 7, 1998, March 17, 1998 and December
9, 1997, respectively, the Funds had no operations other than the sale to
Alliance Capital Management L.P. (the "Adviser") of 3,300 shares of Class I
common stock of each Fund for $33,000, and 33 shares of Class II common stock
of the Alliance Premier Growth Institutional Fund and the Alliance Quasar
Institutional Fund for $330 and 34 shares of Class II common stock of the
Alliance Real Estate Investment Institutional Fund for $340 in each case on
November 12, 1997. Each Fund offers Class I and Class II shares. Sales are made
without a sales charge, at each Fund's net asset value per share. Each class of
shares has identical voting, dividend, liquidation and other rights, except
that each class bears different distribution expenses and has exclusive voting
rights with respect to its distribution plan. The financial statements have
been prepared in conformity with generally accepted accounting principles which
require management to make certain estimates and assumptions that affect the
reported amounts of assets and liabilities in the financial statements and
amounts of income and expenses during the reporting period. Actual results
could differ from those estimates. The following is a summary of significant
accounting policies followed by the Funds.

1. SECURITY VALUATION
Portfolio securities traded on a national securities exchange or on a foreign
securities exchange (other than foreign securities exchanges whose operations
are similar to those of the United States over-the-counter market) are
generally valued at the last reported sale price or if no sale occurred, at the
mean of the closing bid and asked price on that day. Readily marketable
securities traded in the over-the-counter market, securities listed on a
foreign securities exchange whose operations are similar to the U.S.
over-the-counter market, and securities listed on a national securities
exchange whose primary market is believed to be over-the-counter, are valued at
the mean of the current bid and asked prices. U.S. government and fixed income
securities which mature in 60 days or less are valued at amortized cost, unless
this method does not represent fair value. Securities for which current market
quotations are not readily available are valued at their fair value as
determined in good faith by, or in accordance with procedures adopted by, the
Board of Directors. Fixed income securities may be valued on the basis of
prices obtained from a pricing service when such prices are believed to reflect
the fair market value of such securities.

2. CURRENCY TRANSLATION
Assets and liabilities denominated in foreign currencies and commitments under
forward exchange currency contracts are translated into U.S. dollars at the
mean of the quoted bid and asked price of such currencies against the U.S.
dollar. Purchases and sales of portfolio securities are translated into U.S.
dollars at the rates of exchange prevailing when such securities were acquired
or sold. Income and expenses are translated into U.S. dollars at rates of
exchange prevailing when accrued.

Net realized foreign currency gains and losses represent foreign exchange gains
and losses from sales and maturities of securities, closed forward exchange
currency contracts, holding of foreign currencies, options on foreign
currencies, exchange gains and losses realized between the trade and settlement
dates on security transactions, and the difference between the amounts of
interest and dividends recorded on the Funds' books and the U.S. dollar
equivalent amounts actually received or paid. Net currency gains and losses
from valuing foreign currency denominated assets and liabilities at period end
exchange rates are reflected as a component of net unrealized appreciation
(depreciation) of investments and foreign currency denominated assets and
liabilities.

3. ORGANIZATION EXPENSES
Organization expenses of approximately $73,099 for the Real Estate Investment
Institutional Fund, $73,098 for the Premier Growth Institutional Fund and
$73,098 for the Quasar Institutional Fund have been deferred and are being
amortized on a straight-line basis through December 2002, January and March
2003, respectively.

ALLIANCE INSTITUTIONAL FUNDS
_______________________________________________________________________________

4. TAXES
It is each Fund's policy to meet the requirements of the Internal Revenue Code
applicable to regulated investment companies and to distribute all of its
investment company taxable income and net realized gains, if any, to
shareholders. Therefore, no provisions for federal income or excise taxes are
required.

5. INVESTMENT INCOME AND INVESTMENT TRANSACTIONS
Dividend income is recorded on the ex-dividend date. Interest income is accrued
daily. Investment transactions are accounted for on the trade date securities
are purchased or sold. The Funds accrete discounts and amortize premiums as
adjustments to interest income. Investment gains and losses are determined on
the identified cost basis.

6. INCOME AND EXPENSES
All income earned and expenses incurred by the Funds are borne on a pro-rata
basis by each outstanding class of shares, based on the proportionate interest
in the Fund represented by the net assets of such class, except that Class II
shares bear higher transfer agent fees. Expenses of the Company are charged to
each Fund in proportion to net assets.

7. DIVIDENDS AND DISTRIBUTIONS
Dividends and distributions to shareholders are recorded on the ex-dividend
date. Income dividends and capital gains distributions are determined in
accordance with federal tax regulations and may differ from those determined in
accordance with generally accepted accounting principles. To the extent these
differences are permanent, such amounts are reclassified within the capital
accounts based on their federal tax basis treatment; temporary differences, do
not require such reclassification. During the current fiscal year, certain Fund
had permanent differences, primarily due to net operating loss and tax return
of capital, which resulted a net decrease in distribution in excess of net
investment income and a corresponding decrease in additional paid-in capital
for those funds. This reclassification had no effect on net assets.

NOTE B: ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES
Under the terms of an investment advisory agreement, the Funds pay Alliance
Capital Management L.P. (the "Adviser"), an advisory fee at an annual rate of
.90% of the Real Estate Investment Institutional Funds' average daily net
assets and 1% of the Premier Growth Institutional Fund and Quasar Institutional
Funds' average daily net assets. Such fees are accrued daily and paid monthly.
The Adviser has agreed to waive its fees and bear certain expenses to the
extent necessary to limit total operating expenses on an annual basis to .90%
and 1.30% of average daily net assets for Class I and Class II of the Premier
Growth Institutional Fund; 1.20% and 1.35% of average daily net assets for
Class I and Class IIof the Quasar Institutional Fund and 1.00% and 1.40% of
average daily net assets for Class Iand Class II for the Real Estate Investment
Institutional Fund. For the year ended October 31, 1999 such reimbursement
amounted to: Premier Growth Institutional Fund $414,087; Quasar Institutional
Fund $159,162 and Real Estate Investment Institutional Fund $160,965.

Pursuant to the advisory agreement, the Adviser provides to each Fund certain
legal and accounting services. For the year ended October 31, 1999, the Adviser
agreed to waive its fees for such services. Such waiver amounted to: Premier
Growth Institutional Fund $123,000; Quasar Institutional Fund $123,000 and Real
Estate Investment Institutional Fund $123,000.

The Funds compensate Alliance Fund Services, Inc., a wholly-owned subsidiary of
the Adviser, under a Transfer Agency Agreement for providing personnel and
facilities to perform transfer agency services for the Funds. Such compensation
amounted to $32,174, $28,810 and $6,556, respectively for the Premier Growth
Institutional Fund, the Quasar Institutional Fund and the Real Estate
Investment Institutional Fund for the year ended October 31, 1999.

For the year ended October 31, 1999, the Premier Growth Institutional Fund's
expenses were reduced by $336 under an expense offset arrangement with Alliance
Fund Services, Inc.

NOTES TO FINANCIAL STATEMENTS (CONTINUED) ALLIANCE INSTITUTIONAL FUNDS
_______________________________________________________________________________

Brokerage commissions paid on investment transactions for the year ended
October 31, 1999, amounted to $321,005 for the Premier Growth Institutional
Fund; $166,248 for the Quasar Institutional Fund and $66,558 for the Real
Estate Investment Institutional Fund, none of which was paid to brokers
utilizing the services of the Pershing Division of Donaldson, Lufkin & Jenrette
Securities Corp. ("DLJ"), an affiliate of the Adviser, and of which $160 for
the Quasar Institutional Fund was paid to DLJ directly.

NOTE C: DISTRIBUTION SERVICES AGREEMENT
The Funds have adopted a Distribution Services Agreement (the "Agreement")
pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the
Agreement, the Funds pay distribution and servicing fees to the Distributor at
an annual rate of up to .30% of average daily net assets attributable to Class
II shares. There are no distribution and servicing fees on Class I shares. The
fees are accrued daily and paid monthly. The Agreement provides that the
Distributor will use such payments in their entirety for distribution
assistance and promotional activities. In accordance with the Agreement, there
is no provision for recovery of unreimbursed distribution costs incurred by the
Distributor beyond the current fiscal year for Class II shares. The Agreement
also provides that the Adviser may use its own resources to finance the
distribution of the Funds' shares.

NOTE D: INVESTMENT TRANSACTIONS
Purchases and sales of investment securities (excluding short-term investments)
for the year ended October 31, 1999 were as follows:

<TABLE>
<CAPTION>
PURCHASES SALES
--------------------------------- ---------------------------------
STOCKS AND U.S. GOVERNMENT STOCKS AND U.S. GOVERNMENT
FUND DEBT OBLIGATIONS AND AGENCIES DEBT OBLIGATIONS AND AGENCIES
- -------- ---------------- --------------- ---------------- ---------------
<S> <C> <C> <C> <C>
Premier Growth Institutional $277,928,211 $ -0- $118,227,470 $ -0-
Quasar Institutional 56,738,829 -0- 45,299,819 -0-
Real Estate Investment
Institutional 3,440,485 -0- 19,094,536 -0-
</TABLE>

At October 31, 1999, the cost of investments for federal income tax purposes
and the tax basis gross unrealized appreciation, depreciation and net
unrealized appreciation (depreciation), excluding foreign currency
transactions, were as follows:

<TABLE>
<CAPTION>
GROSS UNREALIZED NET UNREALIZED
---------------------------------- APPRECIATION
FUND COST APPRECIATION DEPRECIATION (DEPRECIATION)
- -------- ---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Premier Growth Institutional $234,352,388 $ 28,071,109 $ (8,382,985) $ 19,688,124
Quasar Institutional 33,679,724 2,765,146 (4,544,654) (1,779,508)
Real Estate Investment
Institutional 1,368,479 2,287 (224,560) (222,273)
</TABLE>

For Federal income tax purposes at October 31, 1999, the Funds had capital loss
carryforwards as follows: $995,373 expiring 2006 and $1,819,081 expiring 2007
for the Quasar Institutional Fund, and $280,232 expiring in 2006 and $4,551,298
expiring 2007 for the Real Estate Investment Institutional Fund.

ALLIANCE INSTITUTIONAL FUNDS
_______________________________________________________________________________

NOTE E: CAPITAL STOCK
There are 18,000,000,000 shares of $.001 par value capital stock authorized,
6,000,000,000 shares each for Premier Growth Institutional Fund, Quasar
Institutional Fund and Real Estate Investment Institutional Fund. Each Fund
consists of two classes designated Class I and Class II, each with
3,000,000,000 authorized shares. Transactions in shares of capital stock were
as follows:

PREMIER GROWTH INSTITUTIONAL FUND
SHARES AMOUNT
--------------------------- ------------------------------
JANUARY 7, JANUARY 7,
1998(A) 1998(A)
YEAR ENDED TO YEAR ENDED TO
OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31,
1999 1998 1999 1998
------------ ------------ -------------- --------------
CLASS I
Shares sold 10,778,679 4,846,318 $177,363,056 $ 56,837,599
Shares issued in
reinvestment of
dividends 2,643 -0- 36,258 -0-
Shares redeemed (1,201,728) (341,571) (19,234,357) (4,198,789)
Net increase 9,579,594 4,504,747 $158,164,957 $ 52,638,810

CLASS II
Shares sold 307,481 307,955 $ 4,965,420 $ 3,782,004
Shares redeemed (100,367) (68,449) (1,600,366) (881,774)
Net increase 207,114 239,506 $ 3,365,054 $ 2,900,230

QUASAR INSTITUTIONAL FUND
SHARES AMOUNT
--------------------------- ------------------------------
MARCH 17, MARCH 17,
1998(A) 1998(A)
YEAR ENDED TO YEAR ENDED TO
OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31,
1999 1998 1999 1998
------------ ------------ -------------- --------------
CLASS I
Shares sold 874,661 3,009,763 $ 6,854,096 $ 27,395,135
Shares issued in
reinvestment of
dividends 3,508 -0- 26,172 -0-
Shares redeemed (1,523,199) (247,334) (12,062,941) (1,985,986)
Net increase
(decrease) (645,030) 2,762,429 $ (5,182,673) $ 25,409,149

CLASS II
Shares sold 4,272,523 785,381 $ 35,353,880 $ 5,617,297
Shares redeemed (2,450,077) (785,376) (19,487,576) (5,811,781)
Net increase
(decrease) 1,822,446 5 $ 15,866,304 $ (194,484)

(a) Commencement of operations.

NOTES TO FINANCIAL STATEMENTS (CONTINUED) ALLIANCE INSTITUTIONAL FUNDS
_______________________________________________________________________________

REAL ESTATE INVESTMENT INSTITUTIONAL FUND
SHARES AMOUNT
--------------------------- ------------------------------
DECEMBER 9, DECEMBER 9,
1997(A) 1997(A)
YEAR ENDED TO YEAR ENDED TO
OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31,
1999 1998 1999 1998
------------ ------------ -------------- --------------
CLASS I
Shares sold 239,910 2,486,932 $ 1,863,912 $ 23,779,985
Shares issued in
reinvestment of
dividends 84,640 78,721 632,589 655,108
Shares redeemed (2,494,932) (229,290) (18,627,686) (1,965,003)
Net increase
(decrease) (2,170,382) 2,336,363 $(16,131,185) $ 22,470,090

CLASS II
Shares sold 13 6 $ 100 $ 50
Shares issued in
reinvestment of
dividends 2 1 16 12
Net increase 15 7 $ 116 $ 62

NOTE F: BANK BORROWING
A number of open-end mutual funds managed by the Adviser, including the Funds,
participate in a $750 million revolving credit facility (the "Facility")
intended to provide short-term financing if necessary, subject to certain
restrictions in connection with abnormal redemption activity. Commitment fees
related to the Facility are paid by the participating funds and are included in
miscellaneous expense in the statement of operations. The Funds did not utilize
the Facility during the year ended October 31, 1999.

(a) Commencement of operations.

FINANCIAL HIGHLIGHTS ALLIANCE INSTITUTIONAL FUNDS
_______________________________________________________________________________

SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
PREMIER GROWTH QUASAR REAL ESTATE INVESTMENT
INSTITUTIONAL FUND INSTITUTIONAL FUND INSTITUTIONAL FUND
------------------------ ------------------------ ------------------------
CLASS I CLASS I CLASS I
------------------------ ------------------------ ------------------------
JANUARY 7, MARCH 17, DECEMBER 9,
1998(A) 1998(A) 1997(A)
YEAR ENDED TO YEAR ENDED TO YEAR ENDED TO
OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31,
1999 1998 1999 1998 1999 1998
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $12.62 $10.00 $ 7.42 $10.00 $ 7.78 $10.00

INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (b)(c) (.04) .01 (.02) -0- .37 .43
Net realized and unrealized gain (loss)
on investment transactions 4.98 2.61 .53 (2.58) (.90) (2.26)
Net increase (decrease) in net asset
value from operations 4.94 2.62 .51 (2.58) (.53) (1.83)

LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.01) -0- -0- -0- (.37) (.39)
Distributions in excess of
net investment income -0- -0- (.01) -0- (.06) -0-
Tax return of capital -0- -0- -0- -0- (.05) -0-
Total dividends and distributions (.01) -0- (.01) -0- (.48) (.39)
Net asset value, end of period $17.55 $12.62 $ 7.92 $ 7.42 $ 6.77 $ 7.78

TOTAL RETURN
Total investment return based on net
asset value (d) 39.17% 26.20% 6.88% (25.80)% (7.21)% (18.61)%

RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $247,269 $56,894 $16,798 $20,513 $1,147 $18,193
Ratios to average net assets of:
Expenses, net of waivers/
reimbursements .90% .90%(e) 1.20% 1.20%(e) 1.00% 1.00%(e)
Expenses, before waivers/
reimbursements 1.28% 2.29%(e) 2.08% 3.82%(e) 3.54% 3.09%(e)
Net investment income (loss) (c) (.22)% .08%(e) (.20)% .03%(e) 4.75% 5.62%(e)
Portfolio turnover rate 85% 86% 144% 61% 32% 11%
</TABLE>

See footnote summary on page 30.

FINANCIAL HIGHLIGHTS (CONTINUED) ALLIANCE INSTITUTIONAL FUNDS
_______________________________________________________________________________

SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
PREMIER GROWTH QUASAR REAL ESTATE INVESTMENT
INSTITUTIONAL FUND INSTITUTIONAL FUND INSTITUTIONAL FUND
------------------------ ------------------------ ------------------------
CLASS II CLASS II CLASS II
------------------------ ------------------------ ------------------------
JANUARY 7, MARCH 17, DECEMBER 9,
1998(A) 1998(A) 1997(A)
YEAR ENDED TO YEAR ENDED TO YEAR ENDED TO
OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31,
1999 1998 1999 1998 1999 1998
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $12.58 $10.00 $ 7.40 $10.00 $ 7.77 $10.00

INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (b) (c) (.10) (.03) (.05) (5.89) .20 .41
Net realized and unrealized gain (loss)
on investment transactions 4.96 2.61 .55 3.29 (.74) (2.28)
Net increase (decrease) in net asset
value from operations 4.86 2.58 .50 (2.60) (.54) (1.87)

LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income -0- -0- -0- -0- (.36) (.36)
Distributions in excess of
net investment income -0- -0- -0- -0- (.04) -0-
Tax return of capital -0- -0- -0- -0- (.04) -0-
Total dividends and distributions -0- -0- -0- -0- (.44) (.36)
Net asset value, end of period $17.44 $12.58 $ 7.90 $ 7.40 $ 6.79 $ 7.77

TOTAL RETURN
Total investment return based on net
asset value (d) 38.63% 25.80% 6.76% (26.00)% (7.32)% (19.02)%

RATIOS/SUPPLEMENTAL DATA
Net assets, end of period $7,790(f) $3,014(f) $14,400(f) $283 $380 $320
Ratios to average net assets of:
Expenses, net of waivers/
reimbursements 1.30% 1.30%(e) 1.35% 1.60%(e) 1.40% 1.40%(e)
Expenses, before waivers/
reimbursements 1.68% 2.65%(e) 2.14% 4.62%(e) 2.93% 3.59%(e)
Net investment income (loss) (c) (.62)% (.38)%(e) (.51)% (.14)%(e) 2.32% 5.04%(e)
Portfolio turnover rate 85% 86% 144% 61% 32% 11%
</TABLE>

(a) Commencement of operations.

(b) Based on average shares outstanding.

(d) Total investment return is calculated assuming an initial investment made
at the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of the period. Total investment return calculated
for a period of less than one year is not annualized.

(e) Annualized.

(f) 000's omitted.

REPORT OF ERNST & YOUNG LLP
INDEPENDENT AUDITORS ALLIANCE INSTITUTIONAL FUNDS
_______________________________________________________________________________

TO THE SHAREHOLDERS AND BOARD OF DIRECTORS ALLIANCE INSTITUTIONAL FUNDS, INC.
We have audited the accompanying statements of assets and liabilities,
including the portfolios of investments, of the Alliance Premier Growth
Institutional Fund, Alliance Quasar Institutional Fund and Alliance Real Estate
Investment Institutional Fund (three funds comprising Alliance Institutional
Funds, Inc.) (the "Funds") as of October 31, 1999, and the related statements
of operations for the year then ended, the statements of changes in net assets
and financial highlights for each of the periods indicated therein. These
financial statements and financial highlights are the responsibility of the
Funds' management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements and financial highlights. Our procedures included confirmation of
securities owned as of October 31, 1999, by correspondence with the custodian
and brokers. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of each
of the above listed Funds of Alliance Institutional Funds, Inc. as of October
31, 1999, the results of their operations for the year then ended, the changes
in their net assets and the financial highlights for each of the indicated
periods, in conformity with generally accepted accounting principles.

New York, New York
December 2, 1999

ALLIANCE INSTITUTIONAL FUNDS
_______________________________________________________________________________

BOARD OF DIRECTORS
JOHN D. CARIFA, CHAIRMAN AND PRESIDENT
RUTH BLOCK (1)
DAVID H. DIEVLER (1)
JOHN H. DOBKIN (1)
WILLIAM H. FOULK, JR. (1)
DR. JAMES M. HESTER (1)
CLIFFORD L. MICHEL (1)
DONALD J. ROBINSON (1)

OFFICERS
ALFRED HARRISON, EXECUTIVE VICE PRESIDENT
JANE MACK GOULD, EXECUTIVE VICE PRESIDENT
ALDEN M. STEWART, EXECUTIVE VICE PRESIDENT
KATHLEEN A. CORBET, SENIOR VICE PRESIDENT
RANDALL E. HAASE, SENIOR VICE PRESIDENT
DANIEL G. PINE, SENIOR VICE PRESIDENT
THOMAS J. BARDONG, VICE PRESIDENT
DAVID A. KRUTH, VICE PRESIDENT
DANIEL NORDBY, VICE PRESIDENT
EDMUND P. BERGAN, JR., SECRETARY
MARK D. GERSTEN, TREASURER & CHIEF FINANCIAL OFFICER
VINCENT S. NOTO, CONTROLLER

CUSTODIAN
STATE STREET BANK & TRUST COMPANY
225 Franklin Street
Boston, MA 02116

PRINCIPAL UNDERWRITER
ALLIANCE FUND DISTRIBUTORS, INC.
1345 Avenue of the Americas
New York, NY 10105

LEGAL COUNSEL
SEWARD & KISSEL LLP
One Battery Park Plaza
New York, NY 10004

INDEPENDENT AUDITORS
ERNST & YOUNG LLP
787 Seventh Avenue
New York, NY 10019

TRANSFER AGENT
ALLIANCE FUND SERVICES, INC.
P.O. Box 1520
Secaucus, NJ 07096-1520
Toll-free 1-(800) 221-5672

(1) Member of the Audit Committee.

THE ALLIANCE FAMILY OF MUTUAL FUNDS
_______________________________________________________________________________

FIXED INCOME
Alliance Bond Fund
U.S. Government Portfolio
Corporate Bond Portfolio
Quality Bond Portfolio
Alliance Global Dollar Government Fund
Alliance Global Strategic Income Trust
Alliance High Yield Fund
Alliance Limited Maturity Government Fund
Alliance Mortgage Securities Income Fund
Alliance Multi-Market Strategy Trust
Alliance North American Government Income Trust
Alliance Short-Term U.S. Government Fund

TAX-FREE INCOME
Alliance Municipal Income Fund
California Portfolio
Insured California Portfolio
Insured National Portfolio
National Portfolio
New York Portfolio
Alliance Municipal Income Fund II
Arizona Portfolio
Florida Portfolio
Massachusetts Portfolio
Michigan Portfolio
Minnesota Portfolio
New Jersey Portfolio
Ohio Portfolio
Pennsylvania Portfolio
Virginia Portfolio

MONEY MARKET
AFD Exchange Reserves

GROWTH
The Alliance Fund
Alliance Global Environment Fund
Alliance Growth Fund
Alliance Premier Growth Fund
Select Investors Series - Premier Portfolio

GROWTH & INCOME
Alliance Balanced Shares
Alliance Conservative Investors Fund
Alliance Growth & Income Fund
Alliance Growth Investors Fund
Alliance Real Estate Investment Fund
Alliance Utility Income Fund

AGGRESSIVE GROWTH
Alliance Global Small Cap Fund
Alliance Health Care Fund
Alliance Quasar Fund
Alliance Technology Fund

INTERNATIONAL
Alliance All-Asia Investment Fund
Alliance Greater China '97 Fund
Alliance International Fund
Alliance International Premier Growth Fund
Alliance New Europe Fund
Alliance Worldwide Privatization Fund

INSTITUTIONAL
Premier Growth
Quasar
Real Estate Investment

CLOSED-END FUNDS
Alliance All-Market Advantage Fund
ACM Government Income Fund
ACM Government Opportunity Fund
ACM Government Securities Fund
ACM Government Spectrum Fund
ACM Managed Dollar Income Fund
ACM Managed Income Fund
ACM Municipal Securities Income Fund
Alliance World Dollar Government Fund
Alliance World Dollar Government Fund II
The Austria Fund
The Korean Investment Fund
The Spain Fund
The Southern Africa Fund

CASH MANAGEMENT SERVICES
Alliance Capital Reserves
Alliance Government Reserves
Alliance Institutional Reserves
Prime Portfolio
Government Portfolio
Tax-Free Portfolio
Treasury Portfolio
Trust Portfolio
Alliance Insured Account
Alliance Money Reserves
Alliance Municipal Trust
California Portfolio
Connecticut Portfolio
Florida Portfolio
General Portfolio
Massachusetts Portfolio
New Jersey Portfolio
New York Portfolio
Virginia Portfolio
Alliance Treasury Reserves
Alliance Money Market Fund
Prime Portfolio
General Municipal Portfolio
Government Portfolio

ALLIANCE INSTITUTIONAL FUNDS
1345 Avenue of the Americas
New York, NY 10105
(800) 221-5672

ALLIANCE CAPITAL

THIS REPORT IS INTENDED SOLELY FOR DISTRIBUTION TO CURRENT SHAREHOLDERS
OF THE FUND.

R THESE REGISTERED SERVICE MARKS USED UNDER LICENSE FROM THE OWNER,
ALLIANCE CAPITAL MANAGEMENT L.P.

INSTAR1099