MUNICIPAL INVESTMENT TR FD MULTISTATE SER 401 DEF ASSET FDS, S-6/A, 1998-08-28

MUNICIPAL INVESTMENT TR FD MULTISTATE SER 401 DEF ASSET FDS
S-6/A, 1998-08-28

Previous: MUNICIPAL INVESTMENT TR FD MULTISTATE SER 400 DEF ASSET FDS, 497, 1998-08-28

Next: ALL COMMUNICATIONS CORP/NJ, SC 13G, 1998-08-28

<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 28, 1998

REGISTRATION NO. 333-57375
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

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

AMENDMENT NO. 1
TO
FORM S-6

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

FOR REGISTRATION UNDER THE SECURITIES ACT
OF 1933 OF SECURITIES OF UNIT INVESTMENT
TRUSTS REGISTERED ON FORM N-8B-2

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

A. EXACT NAME OF TRUST:
MUNICIPAL INVESTMENT TRUST FUND
MULTISTATE SERIES 401
(FORMERLY MULTISTATE SERIES 327)
DEFINED ASSET FUNDS

B. NAME OF DEPOSITOR:

MERRILL LYNCH, PIERCE, FENNER & SMITH INC.
SMITH BARNEY INC.
PAINEWEBBER INCORPORATED
DEAN WITTER REYNOLDS INC.

C. COMPLETE ADDRESSES OF DEPOSITORS' PRINCIPAL EXECUTIVE OFFICES:

MERRILL LYNCH, PIERCE,
FENNER &
SMITH INCORPORATED
UNIT INVESTMENT TRUST
DIVISION
P.O. BOX 9051
PRINCETON, NJ 08543-9051 PAINEWEBBER INCORPORATED
1285 AVENUE OF THE
AMERICAS
NEW YORK, NY 10019

SMITH BARNEY INC.
388 GREENWICH
STREET--23RD FLOOR
NEW YORK, NY 10013
DEAN WITTER REYNOLDS INC.
TWO WORLD TRADE
CENTER--59TH FLOOR
NEW YORK, NY 10048

D. NAMES AND COMPLETE ADDRESSES OF AGENTS FOR SERVICE:

TERESA KONCICK, ESQ.
P.O. BOX 9051
PRINCETON, NJ 08543-9051 ROBERT E. HOLLEY
1200 HARBOR BLVD.
WEEHAWKEN, NJ 07087

COPIES TO: DOUGLAS LOWE, ESQ.
PIERRE DE SAINT PHALLE, DEAN WITTER REYNOLDS INC.
LAURIE A. HESSLEIN ESQ. TWO WORLD TRADE
388 GREENWICH STREET 450 LEXINGTON AVENUE CENTER--59TH FLOOR
NEW YORK, NY 10013 NEW YORK, NY 10017 NEW YORK, NY 10048

E. TITLE OF SECURITIES BEING REGISTERED:

An indefinite number of Units of Beneficial Interest pursuant to Rule 24f-2
promulgated under the Investment Company Act of 1940, as amended.

F. APPROXIMATE DATE OF PROPOSED SALE TO PUBLIC:

As soon as practicable after the effective date of the Registration Statement.

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECFICALLY STATES THAT, THIS REGISTRATION STATEMENT
SHALL HEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE
SECURITIES ACT OF 1933 OR ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO
SAID SECTION 8(a), MAY DETERMINE.

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
DEFINED ASSET FUNDSSM
- --------------------------------------------
- ----------------------------------

MUNICIPAL INVESTMENT TRUST FUND
MULTISTATE SERIES 401
(A UNIT INVESTMENT TRUST)
O CALIFORNIA, FLORIDA AND NEW YORK PORTFOLIOS
O PORTFOLIOS OF LONG TERM MUNICIPAL BONDS
O DESIGNED FOR FEDERALLY TAX-FREE INCOME
O EXEMPT FROM SOME STATE TAXES
O MONTHLY INCOME DISTRIBUTIONS

SPONSORS: -------------------------------------------------
Merrill Lynch, The Securities and Exchange Commission has not
Pierce, Fenner & Smith approved or disapproved these Securities or
Incorporated passed upon the adequacy of this prospectus. Any
Smith Barney Inc. representation to the contrary is a criminal
PaineWebber Incorporated offense.

Dean Witter Reynolds Inc. Prospectus dated September , 1998.

<PAGE>
- --------------------------------------------------------------------------------

Defined Asset FundsSM
FOR MORE THAN 25 YEARS, DEFINED ASSET FUNDSSM HAS BEEN A LEADER IN UNIT
INVESTMENT TRUST RESEARCH AND PRODUCT INNOVATION. OUR FAMILY OF 'DEFINEDSM'
FUNDS HELPS INVESTORS WORK TOWARD THEIR FINANCIAL GOALS WITH A FULL RANGE OF
QUALITY INVESTMENTS, INCLUDING MUNICIPAL, CORPORATE AND GOVERNMENT BOND
PORTFOLIOS, AS WELL AS DOMESTIC AND INTERNATIONAL EQUITY PORTFOLIOS.

DEFINED ASSET FUNDS OFFER A NUMBER OF ADVANTAGES:
O FIXED PORTFOLIO: DEFINED FUNDS FOLLOW A BUY AND HOLD INVESTMENT STRATEGY;
FUNDS ARE NOT MANAGED AND PORTFOLIO CHANGES ARE LIMITED.
O PRESELECTED PORTFOLIOS: WE CHOOSE THE STOCKS AND BONDS IN ADVANCE, SO YOU KNOW
WHAT YOU'RE INVESTING IN.
O PROFESSIONAL RESEARCH: OUR DEDICATED RESEARCH TEAM SEEKS OUT STOCKS OR BONDS
APPROPRIATE FOR A PARTICULAR FUND'S OBJECTIVES.
O ONGOING SUPERVISION: WE MONITOR EACH PORTFOLIO ON AN ONGOING BASIS.
NO MATTER WHAT YOUR INVESTMENT GOALS, TOLERANCE FOR RISK OR TIME HORIZON,
THERE'S PROBABLY A DEFINED ASSET FUND THAT SUITS YOUR INVESTMENT STYLE. YOUR
FINANCIAL PROFESSIONAL CAN HELP YOU SELECT A DEFINED ASSET FUND THAT WORKS BEST
FOR YOUR INVESTMENT PORTFOLIO.

CONTENTS
PAGE
-----------

CALIFORNIA INSURED PORTFOLIO............................ 3
RISK/RETURN SUMMARY AND PORTFOLIO.................... 3
FLORIDA INSURED PORTFOLIO............................... 6
RISK/RETURN SUMMARY AND PORTFOLIO.................... 6
NEW YORK PORTFOLIO...................................... 9
RISK/RETURN SUMMARY AND PORTFOLIO.................... 9
WHAT YOU CAN EXPECT FROM YOUR INVESTMENT................ 13
MONTHLY INCOME....................................... 13
RETURN FIGURES....................................... 13
RECORDS AND REPORTS.................................. 13
THE RISKS YOU FACE...................................... 14
INTEREST RATE RISK................................... 14
CALL RISK............................................ 14
REDUCED DIVERSIFICATION RISK......................... 14
LIQUIDITY RISK....................................... 14
CONCENTRATION RISK................................... 14
STATE CONCENTRATION RISK............................. 15
BOND QUALITY RISK.................................... 16
INSURANCE RELATED RISK............................... 16
LITIGATION AND LEGISLATION RISKS..................... 16
SELLING OR EXCHANGING UNITS............................. 16
SPONSORS' SECONDARY MARKET........................... 17
SELLING UNITS TO THE TRUSTEE......................... 17
EXCHANGE OPTION...................................... 18
HOW THE FUND WORKS...................................... 18
PRICING.............................................. 18
EVALUATIONS.......................................... 18
INCOME............................................... 19
EXPENSES............................................. 19
PORTFOLIO CHANGES.................................... 20
FUND TERMINATION..................................... 20
CERTIFICATES......................................... 20
TRUST INDENTURE...................................... 20
LEGAL OPINION........................................ 21
AUDITORS............................................. 21
SPONSORS............................................. 22
TRUSTEE.............................................. 22
UNDERWRITERS' AND SPONSORS' PROFITS.................. 22
PUBLIC DISTRIBUTION.................................. 22
CODE OF ETHICS....................................... 23
YEAR 2000 ISSUES..................................... 23
TAXES................................................... 23
SUPPLEMENTAL INFORMATION................................ 25
FINANCIAL STATEMENTS.................................... 26
REPORT OF INDEPENDENT ACCOUNTANTS.................... 26
STATEMENTS OF CONDITION.............................. 26

2
<PAGE>
- --------------------------------------------------------------------------------

CALIFORNIA INSURED PORTFOLIO--RISK/RETURN SUMMARY

2. WHAT ARE MUNICIPAL REVENUE BONDS?
Municipal revenue bonds are bonds issued by states,
municipalities and public authorities to finance the cost
of buying, building or improving various projects intended
to generate revenue, such as airports, health care
facilities, housing and municipal electric, water and sewer
utilities. Generally, payments on these bonds depend solely
on the revenues generated by the projects, excise taxes or
state appropriations, and are not backed by the
government's taxing power.
3. WHAT IS THE FUND'S INVESTMENT STRATEGY?

O The Fund plans to hold to maturity long-term tax-exempt
municipal bonds with an aggregate face amount of
$ , and some short-term bonds reserved to pay
the deferred sales charge. The Fund is a unit investment
trust which means that, unlike a mutual fund, the Fund's
portfolio is not managed.
o The bonds are rated A or better by Standard & Poor's,
Moody's or Fitch or in the opinion of the agent for the
Sponsors have similar credit quality to bonds rated A or
better.
o Most of the bonds cannot be called for several years, and
after that they can be called at a premium declining over
time to par value. Some bonds may be called earlier at par
for extraordinary reasons.
o 100% of the bonds are insured by AAA-rated insurance
companies that guarantee timely payments of principal and
interest on the bonds (but not Fund units or the market
value of the bonds before they mature).

The Portfolio consists of municipal bonds of the following
types:

APPROXIMATE
PORTFOLIO
PERCENTAGE

o Airports/Ports/Highways %
o Financial Institutions %
o General Obligation %
o Hospitals/Health Care %
o Housing %
o Lease Rental Appropriation %
o University/College %

o Because the Fund is concentrated in bonds, adverse
developments in this industry may affect the value of your
units.

o Assuming no changes in interest rates, when you sell your
units, they will generally be worth less than your cost
because your cost included a sales fee.
o The Fund will receive early returns of principal if bonds
are called or sold before they mature. If this happens your
income will decline and you may not be able to reinvest the
money you receive at as high a yield or as long a maturity.

ALSO, THE PORTFOLIO IS CONCENTRATED IN BONDS OF CALIFORNIA
SO IT IS LESS DIVERSIFIED THAN A NATIONAL FUND AND IS
SUBECT TO RISKS PARTICULAR TO CALIFORNIA WHICH ARE BRIEFLY
DESCRIBED ON PAGE 15.

5. IS THIS FUND APPROPRIATE FOR YOU?
Yes, if you want federally tax-free income. You will
benefit from a professionally selected and supervised
portfolio whose risk is reduced by investing in bonds of
several different issuers.
The Fund is not appropriate for you if you want a
speculative investment that changes to take advantage of
market movements, if you do not want a tax-advantaged
investment or if you cannot tolerate any risk.

3
<PAGE>
- --------------------------------------------------------------------------------

DEFINED CALIFORNIA INSURED PORTFOLIO
- --------------------------------------------------------------------------------

Multistate Series--401

RATING COST
PORTFOLIO TITLE COUPON MATURITY (1) OF ISSUES (2) TO FUND (3)
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
AIRPORT/PORTS/HIGHWAYS ( %):
1. %

HOSPITALS/HEALTH CARE ( %):

2. $
3. $
4. $
5.
6.

HOUSING ( %):

7.
$
8.
9.

INDUSTRIAL DEVELOPMENT ( %):

10.
$

LEASE RENTAL APPROPRIATION ( %):

11.
$
12.

SPECIAL TAX ( %):

13.
$

MISCELLANEOUS ( %):

14.
$
15.
--------------------
--------------------
--------------------
</TABLE>

- ------------------------------------
(1) Approximately % of the bonds are callable beginning in 20 .
(2) All ratings are by Standard & Poor's Ratings Group unless followed by
'(m)', which indiciates a Moody's Investors Service rating or by '(f)',
which indicates a Fitch Investors Service rating. Ratings A through AAA
indicate good to highest quality bonds with a strong to very strong
capacity to pay interest and repay principal.
(3) Approximately % of the bonds were deposited at a premium, % at par
and % at a discount from par. Sponsors' profit on deposit was
$ .
(4) The interest and principal on these bonds will be used to pay the deferred
sales charge obligations of the investors, and these amounts are not
included in the calculation of Estimated Current and Long Term Returns.
------------------------------------

PLEASE NOTE THAT IF THIS PROSPECTUS IS USED AS A PRELIMINARY
PROSPECTUS
FOR A FUTURE FUND IN THIS SERIES, THE PORTFOLIO WILL CONTAIN
DIFFERENT
BONDS FROM THOSE DESCRIBED ABOVE.
<PAGE>

CALIFORNIA INSURED PORTFOLIO (CONTINUED)

DEFINING YOUR INCOME
AND ESTIMATING YOUR RETURN

WHAT YOU MAY EXPECT (Record Day: 10th day of
each month)
First payment per 1,000 units ( /25/98): $
Regular Monthly Income per 1,000 units
beginning /25/98): $
Annual Income per 1,000 units: $
These figures are estimates on the business day before the
initial date of deposit; actual payments may vary.
Estimated Current Return %
Estimated Long Term Return %
Returns will vary (see page 13).

6. WHAT ARE THE FUND'S FEES AND EXPENSES?
This table shows the costs and expenses you may pay,
directly or indirectly, when you invest in the Fund.

INVESTOR FEES
2.90%
Maximum Sales Fee (Load) on new purchases
(as a percentage of $1,000 invested)

You will pay an up-front sales fee of 1.00%, as well as a
total deferred sales fee of $19.00 ($2.38 per 1,000 units
quarterly in the first year and $2.37 per 1,000 units
quarterly in the second year). Employees of some of the
Sponsors and their affiliates may pay a reduced sales fee
of at least $5.00 per 1,000 units.
The maximum sales fee is reduced if you invest at least
$100,000, as follows:

YOUR MAXIMUM
SALES FEE
IF YOU INVEST: WILL BE:
----------------------------------- -----------------
$100,000 to $249,999 2.65%
$250,000 to $499,999 2.40%
$500,000 to $999,999 2.15%
$1,000,000 and over 1.90%

Maximum Exchange Fee 1.90%

ESTIMATED ANNUAL FUND OPERATING EXPENSES

AS A % OF AMOUNT
$1,000 PER 1,000
INVESTED UNITS
---------- -----------
% $
Trustee's Fee
% $
Portfolio Supervision,
Bookkeeping and
Administrative Fees
% $
Evaluator's Fee
% $
Other Operating Expenses
---------- -----------
% $
TOTAL

AMOUNT
PER 1,000
UNITS
---------------------
ORGANIZATION COSTS (deducted from
Fund assets at the close of the
initial offering period)

EXAMPLE
This example may help you compare the cost of investing in
the Fund to the cost of investing in other funds.
The example assumes that you invest $10,000 in the Fund for
the periods indicated and sell all your units at the end of
those periods. The example also assumes a 5% return on your
investment each year and that the Fund's operating expenses
stay the same. Although your actual costs may be higher or
lower, based on these assumptions your costs would be:

1 Year 3 Years 5 Years 10 Years
$ $ $ $

You will pay the following expenses if you do not sell your
units:

1 Year 3 Years 5 Years 10 Years
$ $ $ $

7. HOW HAVE SIMILAR FUNDS PERFORMED IN THE PAST?

In the following chart we show past performance of prior
California Portfolios, which had investment objectives,
strategies and types of bonds substantially similar to this
Fund. These prior Series differed in that they charged a
higher sales fee. These prior California Series were
offered between January 1, 198 and June 30, 1997 and were
outstanding on June 30, 1998. OF COURSE, PAST PERFORMANCE
OF PRIOR SERIES IS NO GUARANTEE OF FUTURE RESULTS OF THIS
FUND.
AVERAGE ANNUAL COMPOUND TOTAL RETURNS
FOR PRIOR SERIES
Reflecting all expenses. For periods ended 6/30/98.

4.5%SALES FEE NO SALES FEE
1 YEAR 5 YEARS 1 YEAR 5 YEARS
- ---------------------------------------------------------------
High % % % %
Average
Low
- ---------------------------------------------------------------

Note: All returns represent changes in unit price with distributions reinvested
into the Municipal Fund Investment Accumulation Program.

8. IS THE FUND MANAGED?
Unlike a mutual fund, the Fund is not managed and bonds are
not sold because of market changes. Rather, experienced
Defined Asset Funds financial analysts regularly review the
bonds in the Fund. The Fund may sell a bond if certain
adverse credit or other conditions exist.

4
<PAGE>

CALIFORNIA INSURED PORTFOLIO (CONTINUED)

UNIT PRICE PER 1,000 UNITS $
(as of September , 1998)

Unit price is based on the net asset value of the Fund plus
the up-front sales fee. An amount equal to any principal
cash, as well as net accrued but undistributed interest on
the unit, is added to the unit price. Unit price also
includes the estimated organization costs shown on the
previous page. An independent evaluator prices the bonds at
3:30 p.m. Eastern time every business day. Unit price
changes every day with changes in the prices of the bonds
in the Fund.
UNIT PAR VALUE $1.00
Unit par value means the total amount of money you should
generally receive on each unit by the termination of the
Fund (other than interest and premium on the bonds). This
total amount assumes that all bonds in the Fund are either
paid at maturity or called by the issuer at par or are sold
by the Fund at par. If you sell your units before the Fund
terminates, you may receive more or less than the unit par
value.
10. HOW DO I SELL UNITS?
You may sell your units at any time to any Sponsor or the
Trustee for the net asset value determined at the close of
business on the date of sale, less any remaining deferred
sales fee. You will not pay any other fee when you sell
your units.

11. HOW ARE DISTRIBUTIONS MADE AND TAXED?

The Fund pays monthly income.
In the opinion of bond counsel when each bond was issued,
interest on the bonds in this Fund is generally 100% exempt
from regular federal income tax. Your income may also be
exempt from some California state and local personal income
taxes if you live in California.
You will also receive principal payments if bonds are sold
or called or mature, when the cash available is more than
$5.00 per 1,000 units. You will be subject to tax on any
gain realized by the Fund on the disposition of bonds.

12. WHAT OTHER SERVICES ARE AVAILABLE?
REINVESTMENT

You will receive your monthly income in cash unless you
choose to compound your income by reinvesting at no sales
fee in the Municipal Fund Investment Accumulation Program,
Inc. This Program is an open-end mutual fund with a
comparable investment objective. Income from this Program
will generally be subject to state and local income taxes.
For more complete information about the Program, including
charges and fees, ask the Trustee for the Program's
prospectus. Read it carefully before you invest. The
Trustee must receive your written election to reinvest at
least 10 days before the record day of an income payment.

EXCHANGE PRIVILEGES
You may exchange units of this Fund for units of certain
other Defined Asset Funds. You may also exchange into this
Fund from certain other funds. We charge a reduced sales
fee on exchanges.

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

TAX-FREE VS. TAXABLE INCOME: A COMPARISON OF TAXABLE AND TAX-FREE YIELDS

FOR CALIFORNIA RESIDENTS

COMBINED
EFFECTIVE
TAXABLE INCOME 1998* TAX RATE TAX-FREE YIELD OF
SINGLE RETURN JOINT RETURN % 3% 3.5% 4% 4.5% 5% 5.5% 6% 6.5%
IS EQUIVALENT TO A TAXABLE YIELD OF

- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 0- 25,350 $ $0- 42,350 20.10 3.75 4.38 5.01 5.63 6.26 6.88 7.51 8.14
$ 25,351- 61,400 $ 42,351-102,300 34.70 4.59 5.36 6.13 6.89 7.66 8.42 9.19 9.95
$ 61,401-128,100 $102,301-155,950 37.42 4.79 5.59 6.39 7.19 7.99 8.79 9.59 10.39
$128,101-278,450 $155,951-278,450 41.95 5.17 6.03 6.89 7.75 8.61 9.47 10.34 11.20
OVER $278,450 OVER $278,450 45.22 5.48 6.39 7.30 8.21 9.13 10.04 10.95 11.87
</TABLE>

To compare the yield of a taxable security with the yield of a tax-free
security, find your taxable income and read across. The table incorporates 1998
federal income tax rates and assumes that all income would otherwise be taxed at
the investor's highest tax rate. Yield figures are for example only.

*Based upon net amount subject to federal income tax after deductions and
exemptions. This table does not reflect the possible effect of other tax
factors, such as alternative minimum tax, personal exemptions, the phase out of
exemptions, itemized deductions, the possible partial disallowance of deductions
or state or local taxation. Consequently, you should consult your own tax
advisers in this regard.

5
<PAGE>
- --------------------------------------------------------------------------------

FLORIDA INSURED PORTFOLIO--RISK/RETURN SUMMARY

1. WHAT IS THE FUND'S OBJECTIVE?
The Fund seeks interest income that is exempt from regular
federal income taxes and some state and local taxes by
investing in a fixed portfolio consisting primarily of 15-
to 30-year municipal revenue bonds.
2. WHAT ARE MUNICIPAL REVENUE BONDS?
Municipal revenue bonds are bonds issued by states,
municipalities and public authorities to finance the cost
of buying, building or improving various projects intended
to generate revenue, such as airports, health care
facilities, housing and municipal electric, water and sewer
utilities. Generally, payments on these bonds depend solely
on the revenues generated by the projects, excise taxes or
state appropriations, and are not backed by the
government's taxing power.
3. WHAT IS THE FUND'S INVESTMENT STRATEGY?
O The Fund plans to hold to maturity long-term tax-exempt
municipal bonds with an aggregate face amount of
$ , and some short-term bonds reserved to pay
the deferred sales charge. The Fund is a unit investment
trust which means that, unlike a mutual fund, the Fund's
portfolio is not managed.
o The bonds are rated A or better by Standard & Poor's,
Moody's or Fitch or in the opinion of the agent for the
Sponsors have similar credit quality to bonds rated A or
better.
o Most of the bonds cannot be called for several years, and
after that they can be called at a premium declining over
time to par value. Some bonds may be called earlier at par
for extraordinary reasons.
o 100% of the bonds are insured by AAA-rated insurance
companies that guarantee timely payments of principal and
interest on the bonds (but not Fund units or the market
value of the bonds before they mature).

The Portfolio consists of municipal bonds of the following
types:

APPROXIMATE
PORTFOLIO
PERCENTAGE

o Airports/Ports/Highways %
o Financial Institutions %
o General Obligation %
o Hospitals/Health Care %
o Housing %
o Lease Rental Appropriation %
o University/College %

4. WHAT ARE THE SIGNIFICANT RISKS?
YOU CAN LOSE MONEY BY INVESTING IN THE FUND. THIS CAN
HAPPEN FOR VARIOUS REASONS, INCLUDING:
o Rising interest rates, an issuer's worsening financial
condition or a drop in bond ratings can reduce the price of
your units.
o Because the Fund is concentrated in bonds, adverse
developments in this industry may affect the value of your
units.
o Assuming no changes in interest rates, when you sell your
units, they will generally be worth less than your cost
because your cost included a sales fee.
o The Fund will receive early returns of principal if bonds
are called or sold before they mature. If this happens your
income will decline and you may not be able to reinvest the
money you receive at as high a yield or as long a maturity.

ALSO, THE PORTFOLIO IS CONCENTRATED IN FLORIDA BONDS, SO IT
IS LESS DIVERSIFIED THAN A NATIONAL FUND AND IS SUBECT TO
RISKS PARTICULAR TO FLORIDA WHICH ARE BRIEFLY DESCRIBED ON
PAGE 15.
5. IS THIS FUND APPROPRIATE FOR YOU?

Yes, if you want federally tax-free income. You will
benefit from a professionally selected and supervised
portfolio whose risk is reduced by investing in bonds of
several different issuers.
The Fund is not appropriate for you if you want a
speculative investment that changes to take advantage of
market movements, if you do not want a tax-advantaged
investment or if you cannot tolerate any risk.

6
<PAGE>
- --------------------------------------------------------------------------------
DEFINED FLORIDA INSURED PORTFOLIO
- --------------------------------------------------------------------------------

Multistate Series--401

HOSPITALS/HEALTH CARE ( %):

2. $
3. $
4. $
5.
6.

HOUSING ( %):

7.
$
8.
9.

INDUSTRIAL DEVELOPMENT ( %):

10.
$

LEASE RENTAL APPROPRIATION ( %):

11.
$
12.

SPECIAL TAX ( %):

13.
$

MISCELLANEOUS ( %):

14.
$
15.
--------------------
--------------------
--------------------

</TABLE>

PLEASE NOTE THAT IF THIS PROSPECTUS IS USED AS A PRELIMINARY
PROSPECTUS
FOR A FUTURE FUND IN THIS SERIES, THE PORTFOLIO WILL CONTAIN
DIFFERENT
BONDS FROM THOSE DESCRIBED ABOVE.
<PAGE>
FLORIDA INSURED PORTFOLIO (CONTINUED)

DEFINING YOUR INCOME
AND ESTIMATING YOUR RETURN

6. WHAT ARE THE FUND'S FEES AND EXPENSES?
This table shows the costs and expenses you may pay,
directly or indirectly, when you invest in the Fund.

INVESTOR FEES
2.90%
Maximum Sales Fee (Load) on new purchases
(as a percentage of $1,000 invested)

Maximum Exchange Fee 1.90%

ESTIMATED ANNUAL FUND OPERATING EXPENSES

AMOUNT
PER 1,000
UNITS
---------------------
ORGANIZATION COSTS (deducted from
Fund assets at the close of the
initial offering period)

1 Year 3 Years 5 Years 10 Years
$ $ $ $

You will pay the following expenses if you do not sell your
units:

1 Year 3 Years 5 Years 10 Years
$ $ $ $

7. HOW HAVE SIMILAR FUNDS PERFORMED IN THE PAST?
In the following chart we show past performance of prior
Florida Portfolios, which had investment objectives,
strategies and types of bonds substantially similar to this
Fund. These prior Series differed in that they charged a
higher sales fee. These prior Florida Series were offered
between January 1, 198 and June 30, 1997 and were
outstanding on June 30, 1998. OF COURSE, PAST PERFORMANCE
OF PRIOR SERIES IS NO GUARANTEE OF FUTURE RESULTS OF THIS
FUND.
AVERAGE ANNUAL COMPOUND TOTAL RETURNS
FOR PRIOR SERIES
Reflecting all expenses. For periods ended 6/30/98.

Note: All returns represent changes in unit price with distributions reinvested
into the Municipal Fund Investment Accumulation Program.

7
<PAGE>
FLORIDA INSURED PORTFOLIO (CONTINUED)

9. HOW DO I BUY UNITS?
The minimum investment is $250.
You can buy units from any of the Sponsors and other
broker-dealers. The Sponsors are listed later in this
prospectus. Some banks may offer units for sale through
special arrangements with the Sponsors, although certain
legal restrictions may apply.
UNIT PRICE PER 1,000 UNITS $
(as of September , 1998)
Unit price is based on the net asset value of the Fund plus
the up-front sales fee. An amount equal to any principal
cash, as well as net accrued but undistributed interest on
the unit, is added to the unit price. Unit price also
includes the estimated organization costs shown on the
previous page. An independent evaluator prices the bonds at
3:30 p.m. Eastern time every business day. Unit price
changes every day with changes in the prices of the bonds
in the Fund.
UNIT PAR VALUE $1.00
Unit par value means the total amount of money you should
generally receive on each unit by the termination of the
Fund (other than interest and premium on the bonds). This
total amount assumes that all bonds in the Fund are either
paid at maturity or called by the issuer at par or are sold
by the Fund at par. If you sell your units before the Fund
terminates, you may receive more or less than the unit par
value.
10. HOW DO I SELL UNITS?
You may sell your units at any time to any Sponsor or the
Trustee for the net asset value determined at the close of
business don the date of sale, less any remaining deferred
sales fee. You will not pay any other fee when you sell
your units.

11. HOW ARE DISTRIBUTIONS MADE AND TAXED?
The Fund pays monthly income.
In the opinion of bond counsel when each bond was issued,
interest on the bonds in this Fund is generally 100% exempt
from regular federal income tax. Your income may also be
exempt from some Florida state and local taxes if you live
in Florida.
You will also receive principal payments if bonds are sold
or called or mature, when the cash available is more than
$5.00 per 1,000 units. You will be subject to tax on any
gain realized by the Fund on the disposition of bonds.
12. WHAT OTHER SERVICES ARE AVAILABLE?
REINVESTMENT
You will receive your monthly income in cash unless you
choose to compound your income by reinvesting at no sales
fee in the Municipal Fund Investment Accumulation Program,
Inc. This Program is an open-end mutual fund with a
comparable investment objective. Income from this Program
will generally be subject to state and local income taxes.
For more complete information about the Program, including
charges and fees, ask the Trustee for the Program's
prospectus. Read it carefully before you invest. The
Trustee must receive your written election to reinvest at
least 10 days before the record day of an income payment.
EXCHANGE PRIVILEGES
You may exchange units of this Fund for units of certain
other Defined Asset Funds. You may also exchange into this
Fund from certain other funds. We charge a reduced sales
fee on exchanges.

- --------------------------------------------------------------------------------
TAX-FREE VS. TAXABLE INCOME: A COMPARISON OF TAXABLE AND TAX-FREE YIELDS

FOR FLORIDA RESIDENTS

EFFECTIVE
TAXABLE INCOME 1998* TAX RATE TAX-FREE YIELD OF
SINGLE RETURN JOINT RETURN % 3% 3.5% 4% 4.5% 5% 5.5% 6% 6.5%
IS EQUIVALENT TO A TAXABLE YIELD OF

- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 0- 25,350 $ 0- 42,350 15.00 3.53 4.12 4.71 5.29 5.88 6.47 7.06 7.65
$ 25,350- 61,400 $ 42,350-102,300 28.00 4.17 4.86 5.56 6.25 6.94 7.64 8.33 9.03
$ 61,400-128,100 $102,300-155,950 31.00 4.35 5.07 5.80 6.52 7.25 7.97 8.70 9.42
$128,100-278,450 $155,950-278,450 36.00 4.69 5.47 6.25 7.03 7.81 8.59 9.38 10.16
OVER $278,450 OVER $278,450 39.60 4.97 5.79 6.62 7.45 8.28 9.11 9.93 10.76
</TABLE>

8
<PAGE>
- --------------------------------------------------------------------------------

NEW YORK PORTFOLIO--RISK/RETURN SUMMARY

1. WHAT IS THE FUND'S OBJECTIVE?
The Fund seeks interest income that is exempt from regular
federal income taxes and some state and local taxes by
investing in a fixed portfolio consisting primarily of 15-
to 30-year municipal revenue bonds.
2. WHAT ARE MUNICIPAL REVENUE BONDS?
Municipal revenue bonds are bonds issued by states,
municipalities and public authorities to finance the cost
of buying, building or improving various projects intended
to generate revenue, such as airports, health care
facilities, housing and municipal electric, water and sewer
utilities. Generally, payments on these bonds depend solely
on the revenues generated by the projects, excise taxes or
state appropriations, and are not backed by the
government's taxing power.
3. WHAT IS THE FUND'S INVESTMENT STRATEGY?
O The Fund plans to hold to maturity long-term tax-exempt
municipal bonds with an aggregate face amount of
$ , and some short-term bonds reserved to pay
the deferred sales charge. The Fund is a unit investment
trust which means that, unlike a mutual fund, the Fund's
portfolio is not managed.
o The bonds are rated A or better by Standard & Poor's,
Moody's or Fitch or in the opinion of the agent for the
Sponsors have similar credit quality to bonds rated A or
better.
o Most of the bonds cannot be called for several years, and
after that they can be called at a premium declining over
time to par value. Some bonds may be called earlier at par
for extraordinary reasons.
o % of the bonds are insured by AAA-rated insurance companies
that guarantee timely payments of principal and interest on
the bonds (but not Fund units or the market value of the
bonds before they mature).

The Portfolio consists of municipal bonds of the following
types:

APPROXIMATE
PORTFOLIO
PERCENTAGE

o Airports/Ports/Highways %
o Financial Institutions %
o General Obligation %
o Hospitals/Health Care %
o Housing %
o Lease Rental Appropriation %
o University/College %

ALSO, THE PORTFOLIO IS CONCENTRATED IN NEW YORK BONDS, SO
IT IS LESS DIVERSIFIED THAN A NATIONAL FUND AND IS SUBECT
TO RISKS PARTICULAR TO NEW YORK, WHICH ARE BRIEFLY
DESCRIBED ON PAGE 15.
5. IS THIS FUND APPROPRIATE FOR YOU?
Yes, if you want federally tax-free income. You will
benefit from a professionally selected and supervised
portfolio whose risk is reduced by investing in bonds of
several different issuers.
The Fund is not appropriate for you if you want a
speculative investment that changes to take advantage of
market movements, if you do not want a tax-advantaged
investment or if you cannot tolerate any risk.

9
<PAGE>
- --------------------------------------------------------------------------------
DEFINED NEW YORK PORTFOLIO
- --------------------------------------------------------------------------------

Multistate Series--401

HOSPITALS/HEALTH CARE ( %):

2. $
3. $
4. $
5.
6.

HOUSING ( %):

7.
$
8.
9.

INDUSTRIAL DEVELOPMENT ( %):

10.
$

LEASE RENTAL APPROPRIATION ( %):

11.
$
12.

SPECIAL TAX ( %):

13.
$

MISCELLANEOUS ( %):

14.
$
15.
--------------------
--------------------
--------------------

</TABLE>

- ------------------------------------
(1) Approximately % of the bonds are callable beginning in 20 .
(2) All ratings are by Standard & Poor's Ratings Group unless followed by
'(m)', which indiciates a Moody's Investors Service rating or by '(f)',
which indicates a Fitch Investors Service rating. Ratings A through AAA
indicate good to highest quality bonds with a strong to very strong
capacity to pay interest and repay principal. Bonds designated by 'NR' are
not rated but in the opinion of the agent for the Sponsors have similar
credit quality to bonds rated A or better.
(3) Approximately % of the bonds were deposited at a premium, % at par
and % at a discount from par. Sponsors' profit on deposit was
$ .
(4) The interest and principal on these bonds will be used to pay the deferred
sales charge obligations of the investors, and these amounts are not
included in the calculation of Estimated Current and Long Term Returns.
------------------------------------

DEFINING YOUR INCOME
AND ESTIMATING YOUR RETURN

6. WHAT ARE THE FUND'S FEES AND EXPENSES?
This table shows the costs and expenses you may pay,
directly or indirectly, when you invest in the Fund.

INVESTOR FEES
2.90%
Maximum Sales Fee (Load) on new purchases
(as a percentage of $1,000 invested)

Maximum Exchange Fee 1.90%

ESTIMATED ANNUAL FUND OPERATING EXPENSES

AMOUNT
PER 1,000
UNITS
---------------------
ORGANIZATION COSTS (deducted from
Fund assets at the close of the
initial offering period)

1 Year 3 Years 5 Years 10 Years
$ $ $ $

You will pay the following expenses if you do not sell your
units:

1 Year 3 Years 5 Years 10 Years
$ $ $ $

7. HOW HAVE SIMILAR FUNDS PERFORMED IN THE PAST?
In the following chart we show past performance of prior
New York Portfolios, which had investment objectives,
strategies and types of bonds substantially similar to this
Fund. These prior Series differed in that they charged a
higher sales fee. These prior New York Series were offered
between January 1, 198 and June 30, 1997 and were
outstanding on June 30, 1998. OF COURSE, PAST PERFORMANCE
OF PRIOR SERIES IS NO GUARANTEE OF FUTURE RESULTS OF THIS
FUND.
AVERAGE ANNUAL COMPOUND TOTAL RETURNS
FOR PRIOR SERIES
Reflecting all expenses. For periods ended 6/30/98.

Note: All returns represent changes in unit price with distributions reinvested
into the Municipal Fund Investment Accumulation Program.

10
<PAGE>
NEW YORK PORTFOLIO (CONTINUED)

9. HOW DO I BUY UNITS?
The minimum investment is $250.
You can buy units from any of the Sponsors and other
broker-dealers. The Sponsors are listed later in this
prospectus. Some banks may offer units for sale through
special arrangements with the Sponsors, although certain
legal restrictions may apply.
UNIT PRICE PER 1,000 UNITS $
(as of September , 1998)
Unit price is based on the net asset value of the Fund plus
the up-front sales fee. An amount equal to any principal
cash, as well as net accrued but undistributed interest on
the unit, is added to the unit price. Unit price also
includes the estimated organization costs shown on the
previous page. An independent evaluator prices the bonds at
3:30 p.m. Eastern time every business day. Unit price
changes every day with changes in the prices of the bonds
in the Fund.
UNIT PAR VALUE $1.00
Unit par value means the total amount of money you should
generally receive on each unit by the termination of the
Fund (other than interest and premium on the bonds). This
total amount assumes that all bonds in the Fund are either
paid at maturity or called by the issuer at par or are sold
by the Fund at par. If you sell your units before the Fund
terminates, you may receive more or less than the unit par
value.
10. HOW DO I SELL UNITS?
You may sell your units at any time to any Sponsor or the
Trustee for the net asset value determined at the close of
business on the date of sale, less any remaining deferred
sales fee. You will not pay any other fee when you sell
your units.

11. HOW ARE DISTRIBUTIONS MADE AND TAXED?
The Fund pays monthly income.
In the opinion of bond counsel when each bond was issued,
interest on the bonds in this Fund is generally 100% exempt
from regular federal income tax. Your income may also be
exempt from New York state and local personal income taxes
if you live in New York.
You will also receive principal payments if bonds are sold
or called or mature, when the cash available is more than
$5.00 per 1,000 units. You will be subject to tax on any
gain realized by the Fund on the disposition of bonds.
12. WHAT OTHER SERVICES ARE AVAILABLE?
REINVESTMENT
You will receive your monthly income in cash unless you
choose to compound your income by reinvesting at no sales
fee in the Municipal Fund Investment Accumulation Program,
Inc. This Program is an open-end mutual fund with a
comparable investment objective. Income from this Program
will generally be subject to state and local income taxes.
For more complete information about the Program, including
charges and fees, ask the Trustee for the Program's
prospectus. Read it carefully before you invest. The
Trustee must receive your written election to reinvest at
least 10 days before the record day of an income payment.
EXCHANGE PRIVILEGES
You may exchange units of this Fund for units of certain
other Defined Asset Funds. You may also exchange into this
Fund from certain other funds. We charge a reduced sales
fee on exchanges.

11
<PAGE>
- --------------------------------------------------------------------------------
TAX-FREE VS. TAXABLE INCOME: A COMPARISON OF TAXABLE AND TAX-FREE YIELDS

FOR NEW YORK CITY RESIDENTS

COMBINED
EFFECTIVE
TAXABLE INCOME 1998* TAX RATE TAX-FREE YIELD OF
SINGLE RETURN JOINT RETURN % 3% 3.5% 4% 4.5% 5% 5.5% 6% 6.5%
IS EQUIVALENT TO A TAXABLE YIELD OF

- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 0- 25,350 $ 0- 42,350 24.55 3.38 4.64 5.30 5.96 6.63 7.29 7.95 8.62
$ 25,350- 61,400 $ 42,350-102,300 36.14 4.70 5.48 6.28 7.05 7.83 8.61 9.40 10.18
$ 61,400-128,100 $102,300-155,950 38.80 4.90 5.72 6.54 7.35 8.17 8.99 9.80 10.62
$128,100-278,450 $155,950-278,450 43.24 5.29 6.17 7.05 7.83 8.81 9.69 10.57 11.45
OVER $278,450 OVER $278,450 46.43 5.60 6.53 7.47 8.40 9.33 10.27 11.20 12.13
</TABLE>

FOR NEW YORK STATE RESIDENTS
- --------------------------------------------------------------------------------

COMBINED
EFFECTIVE
TAXABLE INCOME 1998* TAX RATE TAX-FREE YIELD OF
SINGLE RETURN JOINT RETURN % 3% 3.5% 4% 4.5% 5% 5.5% 6% 6.5% 7%
IS EQUIVALENT TO A TAXABLE YIELD OF

- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 0- 25,350 $ 0- 42,350 20.82 3.79 4.42 5.05 5.68 6.31 6.95 7.58 8.21 8.84
$ 25,350- 61,400 $ 42,350-102,300 32.93 4.47 5.22 5.96 6.71 7.46 8.20 8.95 9.69 10.44
$ 61,400-128,100 $102,300-155,950 35.73 4.67 5.45 6.22 7.00 7.78 8.56 9.34 10.11 10.69
$128,100-278,450 $155,950-278,450 40.38 5.03 5.87 6.71 7.55 8.39 9.23 10.06 10.90 11.74
OVER $278,450 OVER $278,450 43.74 5.33 6.22 7.11 8.00 8.89 9.78 10.66 11.55 12.44
</TABLE>

12
<PAGE>
WHAT YOU CAN EXPECT FROM YOUR INVESTMENT

MONTHLY INCOME

The Fund will pay you regular monthly income. Your monthly income may vary
because of:

o elimination of one or more bonds from the Fund's portfolio because of
calls, redemptions or sales;
o a change in the Fund's expenses; or
o the failure by a bond's issuer to pay interest.

Changes in interest rates generally will not affect your monthly income because
the portfolio is fixed.

Along with your monthly income, you will receive your share of any available
bond principal.

RETURN FIGURES

We cannot predict your actual return, which will vary with unit price, how long
you hold your investment and changes in the portfolio, interest income and
expenses.

Estimated Current Return equals the estimated annual cash to be received from
the bonds in the Fund less estimated annual Fund expenses, divided by the Unit
Price (including the maximum sales fee):

Estimated Annual Estimated
Interest Income - Annual Expenses
- -------------------------------------------------
Unit Price

Estimated Long Term Return is a measure of the estimated return over the
estimated life of the Fund. Unlike Estimated Current Return, Estimated Long Term
Return reflects maturities, discounts and premiums of the bonds in the Fund. It
is an average of the yields to maturity (or in certain cases, to an earlier call
date) of the individual bonds in the portfolio, adjusted to reflect the Fund's
maximum sales fee and estimated expenses. We calculate the average yield for the
portfolio by weighting each bond's yield by its market value and the time
remaining to the call or maturity date.

Yields on individual bonds depend on many factors including general conditions
of the bond markets, the size of a particular offering and the maturity and
quality rating of the particular issues. Yields can vary among bonds with
similar maturities, coupons and ratings.

These return quotations are designed to be comparative rather than predictive.

RECORDS AND REPORTS

You will receive:

o a monthly statement of income payments and any principal payments;

o a notice from the Trustee when new bonds are deposited in exchange or
substitution for bonds originally deposited;
o an annual report on Fund activity; and
o annual tax information. This will also be sent to the IRS. You must report the
amount of tax-exempt interest received during the year.

You may request:
o copies of bond evaluations to enable you to comply with federal and state tax
reporting requirements; and
o audited financial statements of the Fund.

You may inspect records of Fund transactions at the Trustee's office during
regular business hours.

13
<PAGE>
THE RISKS YOU FACE

INTEREST RATE RISK

Investing involves risks, including the risk that your investment will decline
in value if interest rates rise. Generally, bonds with longer maturities will
change in value more than bonds with shorter maturities. Bonds in the Fund are
more likely to be called when interest rates decline. This would result in early
returns of principal to you and may result in early termination of the Fund. Of
course, we cannot predict how interest rates may change.

CALL RISK

Many bonds can be prepaid or 'called' by the issuer before their stated
maturity.

For example, an issuer might call its bonds if it no longer needs the money for
the original purpose or, during periods of falling interest rates, if the
issuer's bonds have a coupon higher than current market rates. If the bonds are
called, your income will decline and you may not be able to reinvest the money
you receive at as high a yield or as long a maturity. An early call at par of a
premium bond will reduce your return.

REDUCED DIVERSIFICATION RISK

If many investors sell their units, the Fund will have to sell bonds. This could
reduce the diversification of your investment and increase your share of Fund
expenses.

LIQUIDITY RISK

You can always sell back your units, but we cannot assure you that a liquid
trading market will always exist for the bonds in the portfolio, especially
since current law may restrict the Fund from selling bonds to any Sponsor. The
bonds will generally trade in the over-the-counter market. The value of the
bonds, and of your investment, may be reduced if trading in bonds is limited or
absent.

CONCENTRATION RISK

When a certain type of bond makes up 25% or more of the portfolio, it is said to
be 'concentrated' in that bond type, which makes the Portfolio less diversified.

Here is what you should know about the [State] Portfolio's concentration in
[hospital and health care bonds.

o payment for these bonds depends on revenues from private third-party payors
and government programs, including Medicare and Medicaid, which have
generally undertaken cost containment measures to limit payments to health
care providers;
o hospitals face competition resulting from hospital mergers and
affiliations;
o hospitals need to reduce costs as HMOs increase market penetration and
hospital supply and drug companies raise prices; and

o hospitals and health care providers are subject to various legal claims by
patients and others and are adversely affected by increasing costs of
insurance.]
[other concentrations]

Changes to the portfolio from bond redemptions, maturities and sales may affect
the Fund's concentrations over time.

14
<PAGE>

STATE CONCENTRATION RISK

CALIFORNIA RISKS

From the late 1980s through the early 1990s, an economic recession eroded
California's revenue base. At the same time rapid population growth caused State
expenditures to exceed budget appropriations. As a result California experienced
a period of sustained buget imbalance.

Since that time the California economy has begun to improve and the extreme
budgetary pressures have begun to lessen. Yet, despite this somewhat improved
economy, many unpredictable events may still harm the ability of California bond
issuers to make payments to bondholders. For example, in December 1994, Orange
County, California and its Investment Pool filed for bankruptcy. The final
impact on the County and the State is still unknown. Similarly, the State faces
uncontrollable events each year (from increased health and welfare caseloads to
natural disasters) that can strain the economy and reduce issuers' ability to
pay their debts.

Certain provisions of California's Constitution, laws and regulatory system
contain tax, spending and appropriations limits and prohibit certain new taxes.
Certain other California laws subject the users of bond proceeds to strict rules
and limits regarding revenue repayment. Each of these could adversely affect an
issuer's ability to make payments on the bonds or limit the remedies available
to bondholders.

General obligation bonds of the State of California are currently rated A1 by
Moody's and A+ by Standard & Poor's.

FLORIDA RISKS

Various national, state, economic and social policies will affect Florida's
financial condition. Florida's Constitution and laws restrict the ability of
both the State and local governments to raise certain taxes and issue debt.
Florida's economy has depended on tourism and construction, historically. It is,
therefore, dependent on trends in those industries. Additionally, South
Florida's economy is heavily dependent on foreign trade. Because it is close to
Central and South America, South Florida is susceptible to economic troubles in
that region as well as international trade and currency imbalances. By contrast,
Central and Northern Florida's economy depends heavily on agriculture. Crop
failures, severe weather conditions and other agricultural problems
(particularly in the citrus and sugar industries) could adversely affect the
economy in this area. These conditions, among others, may limit the ability of
State and local governments in Florida to meet their repayment obligations.

General obligation bonds of the State are currently rated Aa2 by Moody's, AA+ by
Standard & Poor's and AA by Fitch.

NEW YORK RISKS

For decades, New York State's economy has grown more slowly than the rest of the
nation. This is due partly to a decline in manufacturing and the high combined
State and local tax burden. Both the State and New York City suffer from
long-term structural imbalances between revenues and expenses. State and City
dependence on federal aid and sensitivity to the financial services industry, as
well as high levels of taxes and unemployment,

15
<PAGE>
may continue to make it difficult to balance future State and local budgets. In
past years, each has relied on substantial non-recurring measures. Legislation
requires the City to maintain a balanced budget and sharply restricts State
borrowing to finance any future defecits.

The State also faces difficulty in approving budgets, adopted late for many
years. The State projects budget gaps of $2 billion and $4 billion for the next
two fiscal years. State general obligation bonds are currently rated A by
Standard & Poor's and A2 by Moody's. State-related debt totalled $37 billion in
1998.

New York City achieved a small budget surplus each year since 1981. The City
currently projects budget gaps of over $1.2 billion in each of the next three
years. It faces pressures particularly from aging public facilities which need
repair or replacement; welfare and medical costs; and expiring labor contracts.
Also, the City requires substantial State aid, and its financial strength
depends highly on the securities industry. City general obligation bonds are
currently rated A-by Standard & Poor's and A3 by Moody's. The City's financial
position is also pressured by a high and increasing debt burden.

BOND QUALITY RISK

A reduction in a bond's rating may decrease its value and, indirectly, the value
of your investment in the Fund.

INSURANCE RELATED RISK

Some bonds are backed by insurance companies (as shown under Defined
Portfolios). Insurance policies generally make payments only according to a
bond's original payment schedule and do not make early payments when a bond
defaults or becomes taxable. Although the federal government does not regulate
the insurance business, various state laws and federal initiatives and tax law
changes could significantly affect the insurance business. The claims-paying
ability of the insurance companies is generally rated AAA by Standard & Poor's
or another nationally recognized rating organization. The insurance company
ratings are subject to change at any time at the discretion of the rating
agencies.

LITIGATION AND LEGISLATION RISKS

We do not know of any pending litigation that might have a material adverse
effect upon the Fund.

Future tax legislation could affect the value of the portfolio by:
o limiting real property taxes,
o reducing tax rates,
o imposing a flat or other form of tax, or
o exempting investment income from tax.

SELLING OR EXCHANGING UNITS

You can sell your units at any time for a price based on net asset value. Your
net asset value is calculated each business day by:
o adding the value of the bonds, net accrued interest, cash and any other
Fund assets;
o subtracting accrued but unpaid Fund expenses, unreimbursed Trustee
advances, cash held to buy back units or for distribution to investors and
any other Fund liabilities; and
o dividing the result by the number of outstanding units.

Your net asset value when you sell may be more or less than your cost because of
sales

16
<PAGE>
fees, market movements and changes in the portfolio.

As of the close of the initial offering period, the price you receive will be
reduced to reflect estimated organization costs.

If you sell your units before the final deferred sales fee installment, the
amount of any remaining installments will be deducted from your proceeds.

SPONSORS' SECONDARY MARKET

While we are not obligated to do so, we will buy back units at net asset value
without any other fee or charge other than any remaining deferred sales charge.
We may resell the units to other buyers or to the Trustee. You should consult
your financial professional for current market prices to determine if other
broker-dealers or banks are offering higher prices.

We have maintained the secondary market continuously for over 25 years, but we
could discontinue it without prior notice for any business reason.

SELLING UNITS TO THE TRUSTEE

Regardless of whether we maintain a secondary market, you can sell your units to
the Trustee at any time by sending the Trustee a letter (with any outstanding
certificates if you hold Unit certificates). You must properly endorse your
certificates (or execute a written transfer instrument with signatures
guaranteed by an eligible institution). Sometimes, additional documents are
needed such as a trust document, certificate of corporate authority, certificate
of death or appointment as executor, administrator or guardian.

Within seven days after your request and the necessary documents are received,
the Trustee will mail a check to you. Contact the Trustee for additional
information.

As long as we are maintaining a secondary market, the Trustee will sell your
units to us at a price based on net asset value. If there is no secondary
market, the Trustee will sell your units in the over-the-counter market if it
believes it can obtain a higher price. In that case, you will receive the net
proceeds of the sale.

If the Fund does not have cash available to pay you for units you are selling,
the agent for the Sponsors will select bonds to be sold. Bonds will be selected
based on market and credit factors. These sales could be made at times when the
bonds would not otherwise be sold and may result in your receiving less than the
unit par value and also reduce the size and diversity of the Fund.

If you acquire 25% or more of the outstanding units of the Fund and you sell
units with a value exceeding $250,000, the Trustee may choose to pay you 'in
kind' by distributing bonds and cash with a total value equal to the price of
those units. The Trustee will try to distribute bonds in the portfolio pro rata,
but it reserves the right to distribute only one or a few bonds. The Trustee
will act as your agent in an in kind distribution and will either hold the bonds
for your account or sell them as you instruct. You must pay any transaction
costs as well as transfer and ongoing custodial fees on sales of bonds
distributed in kind.

There could be a delay in paying you for your units:

17
<PAGE>
o if the New York Stock Exchange is closed (other than customary weekend and
holiday closings);
o if the SEC determines that trading on the New York Stock Exchange is
restricted or that an emergency exists making sale or evaluation of the
bonds not reasonably practicable; and
o for any other period permitted by SEC order.

EXCHANGE OPTION

You may exchange units of certain Defined Asset Funds for units of this Fund at
a maximum exchange fee of 1.90%. You may exchange units of this Fund for units
of certain other Defined Asset Funds at a reduced sales fee if your investment
goals change. To exchange units, you should talk to your financial professional
about what funds are exchangeable, suitable and currently available.

Normally, an exchange is taxable and you must recognize any gain or loss on the
exchange. However, the IRS may try to disallow a loss if the portfolios of the
two funds are not materially different; you should consult your own tax adviser.

We may amend or terminate this exchange option at any time without notice.

HOW THE FUND WORKS

PRICING

The price of a unit includes interest accrued on the bonds, less expenses, from
the initial date of deposit up to, but not including, the settlement date, which
is usually three business days after the purchase date of the unit.

Bonds also carry accrued but unpaid interest up to the initial date of deposit.
To avoid having you pay this additional accrued interest (which earns no return)
when you buy, the Trustee advances this amount to the Sponsors. The Trustee
recovers this advance from interest received on the bonds.

A portion of the price of a unit consists of cash so that the Trustee can
provide you with regular monthly income. When you sell your units you will
receive your share of this cash.

In addition, a portion of the price of a unit also consists of cash to pay all
or some of the costs of organizing the Fund including:
o cost of initial preparation of legal documents;
o federal and state registration fees;
o initial fees and expenses of the Trustee;
o initial audit; and
o legal expenses and other out-of-pocket expenses.

EVALUATIONS

An independent Evaluator values the bonds on each business day (excluding
Saturdays, Sundays and the following holidays as observed by the New York Stock
Exchange: New Year's Day, Presidents' Day, Martin Luther King, Jr. Day, Good
Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving and Christmas).
Bond values are based on current bid or offer prices for the bonds or comparable
bonds. In the past, the difference between bid and offer prices of publicly
offered tax-exempt bonds has ranged from 0.5% of face amount on actively traded
issues to 3.5% on inactively traded issues; the difference has averaged between
1 and 2%.

18
<PAGE>
INCOME

Interest on any bonds purchased on a when-issued basis or for a delayed delivery
does not begin to accrue interest until the bonds are delivered to the Fund. The
Trustee may reduce its fee to provide you with tax-exempt income for this
non-accrual period. If a bond is not delivered on time and the Trustee's annual
fee and expenses do not cover the additional accrued interest, we will treat the
contract to buy the bond as failed.

The Trustee credits interest to an Income Account and other receipts to a
Capital Account. The Trustee may establish a Reserve Account by withdrawing from
these accounts amounts it considers appropriate to pay any material liability.
These accounts do not bear interest.

EXPENSES

The Trustee is paid a fee monthly. It also benefits when it holds cash for the
Fund in non-interest bearing accounts. The Trustee may also receive additional
amounts:
o for extraordinary services and costs of indemnifying the Trustee and the
Sponsors;
o costs of actions taken to protect the Fund and other legal fees and
expenses;
o expenses for keeping the Fund's registration statement current; and
o Fund termination expenses and any governmental charges.

The Sponsors are currently reimbursed up to 45 cents per $1,000 face amount
annually for providing portfolio supervisory, bookkeeping and administrative
services and for any other expenses properly chargeable to the Fund. While this
fee may exceed the amount of these costs and expenses attributable to this Fund,
the total of these fees for all Series of Defined Asset Funds will not exceed
the aggregate amount attributable to all of these Series for any calendar year.
The Fund also pays the Evaluator's fees.

The Trustee's, Sponsors' and Evaluator's fees may be adjusted for inflation
without investors' approval.

Quarterly deferred sales charges you owe are paid with interest and principal
from certain bonds. If these amounts are not enough, the rest will be paid out
of distributitons to you from the Fund's Capital and Income Accounts.

The Sponsors will pay advertising and selling expenses at no charge to the Fund.
If Fund expenses exceed initial estimates, the Fund will owe the excess. The
Trustee has a lien on Fund assets to secure reimbursement of Fund expenses and
may sell bonds if cash is not available.

PORTFOLIO CHANGES

The Sponsors and Trustee are not liable for any default or defect in a bond; if
a contract to buy any bond fails in the first 90 days of the Fund, we generally
will deposit a replacement tax-exempt bond with a similar yield, maturity,
rating and price.

Unlike a mutual fund, the portfolio is designed to remain intact and we may keep
bonds in the portfolio even if their credit quality declines or other adverse
financial circumstances occur. However, we may sell a bond in certain cases if
we believe that certain adverse credit conditions exist or if a bond becomes
taxable.

19
<PAGE>
If we maintain a secondary market in units but are unable to sell the units that
we buy in the secondary market, we will redeem units, which will affect the size
and composition of the portfolio. Units offered in the secondary market may not
represent the same face amount of bonds that they did originally.

We decide whether or not to offer units for sale that we acquire in the
secondary market after reviewing:
o diversity of the portfolio;
o size of the Fund relative to its original size;
o ratio of Fund expenses to income;
o current and long-term returns;
o degree to which units may be selling at a premium over par; and
o cost of maintaining a current prospectus.

FUND TERMINATION

The Fund will terminate following the stated maturity or sale of the last bond
in the portfolio. The Fund may also terminate earlier with the consent of
investors holding 51% of the units or if total assets of the Fund have fallen
below 40% of the face amount of bonds originally deposited. We will decide
whether to terminate the Fund early based on the same factors used in deciding
whether or not to offer units in the secondary market.

When the Fund is about to terminate you will receive a notice, and you will be
unable to sell your units after that time. On or shortly before termination, we
will sell any remaining bonds, and you will receive your final distribution. Any
bond that cannot be sold at a reasonable price may continue to be held by the
Trustee in a liquidating trust pending its final sale.

You will pay your share of the expenses associated with termination, including
brokerage costs in selling bonds. This may reduce the amount you receive as your
final distribution.

CERTIFICATES

Certificates for units are issued on request. You may transfer certificates by
complying with the requirements for redeeming certificates, described above. You
can replace lost or mutilated certificates by delivering satisfactory indemnity
and paying the associated costs.

TRUST INDENTURE

The Fund is a 'unit investment trust' governed by a Trust Indenture, a contract
among the Sponsors, the Trustee and the Evaluator, which sets forth their duties
and obligations and your rights. A copy of the Indenture is available to you on
request to the Trustee. The following summarizes certain provisions of the
Indenture.

The Sponsors and the Trustee may amend the Indenture without your consent:
o to cure ambiguities;
o to correct or supplement any defective or inconsistent provision;
o to make any amendment required by any governmental agency; or
o to make other changes determined not to be materially adverse to your best
interest (as determined by the Sponsors).
Investors holding 51% of the units may amend the Indenture. Every investor must
consent to any amendment that changes the 51% requirement. No amendment may
reduce your interest in the Fund without your written consent.

20
<PAGE>
The Trustee may resign by notifying the Sponsors. The Sponsors may remove the
Trustee without your consent if:
o it fails to perform its duties;
o it becomes incapable of acting or bankrupt or its affairs are taken over by
public authorities; or
o the Sponsors determine that its replacement is in your best interest.
Investors holding 51% of the units may remove the Trustee. The Evaluator may
resign or be removed by the Sponsors and the Trustee without the consent of
investors. The resignation or removal of either becomes effective when a
successor accepts appointment. The Sponsors will try to appoint a successor
promptly; however, if no successor has accepted within 30 days after notice of
resignation, the resigning Trustee or Evaluator may petition a court to appoint
a successor.

Any Sponsor may resign as long as one Sponsor with a net worth of $2 million
remains and agrees to the resignation. The remaining Sponsors and the Trustee
may appoint a replacement. If there is only one Sponsor and it fails to perform
its duties or becomes bankrupt the Trustee may:
o remove it and appoint a replacement Sponsor;
o liquidate the Fund; or
o continue to act as Trustee without a Sponsor.

Merrill Lynch, Pierce, Fenner & Smith Incorporated acts as agent for the
Sponsors.

The Trust Indenture contains customary provisions limiting the liability of the
Trustee, the Sponsors and the Evaluator.

LEGAL OPINION

Davis Polk & Wardwell, 450 Lexington Avenue, New York, New York 10017, as
counsel for the Sponsors, has given an opinion that the units are validly
issued. Special counsel located in the relevant states have given state and
local tax opinions.

AUDITORS

Deloitte & Touche LLP, 2 World Financial Center, New York, New York 10281,
independent accountants, audited the Statement of Condition included in this
prospectus.

21
<PAGE>
SPONSORS

The Sponsors and their underwriting percentages are:

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED (a wholly-owned subsidiary of
Merrill Lynch & Co., Inc.)
P.O. Box 9051,
Princeton, NJ 08543-9051 %

SMITH BARNEY INC. (an indirectly wholly-owned subsidiary of The Travelers Inc.)
388 Greenwich Street--23rd Floor,
New York, NY 10013 %
DEAN WITTER REYNOLDS INC. (a principal operating subsidiary of Morgan Stanley
Dean Witter & Co.)
Two World Trade Center--59th Floor,
New York, NY 10048 %
PAINEWEBBER INCORPORATED (a wholly-owned subsidiary of PaineWebber Group Inc.)
1285 Avenue of the Americas,
New York, NY 10019 _______%
100.00%

Each Sponsor is a Delaware corporation and it, or its predecessor, has acted as
sponsor to many unit investment trusts. As a registered broker-dealer each
Sponsor buys and sells securities (including investment company shares) for
others (including investment companies) and participates as an underwriter in
various selling groups.

TRUSTEE

The Chase Manhattan Bank, Unit Investment Trust Department, 4 New York
Plaza--6th Floor, New York, New York 10004, is the Trustee. It is supervised by
the Federal Deposit Insurance Corporation, the Board of Governors of the Federal
Reserve System and New York State banking authorities.

UNDERWRITERS' AND SPONSORS' PROFITS

Underwriters receive sales charges when they sell units. Sponsors also realize a
profit or loss on deposit of the bonds shown under Defined Portfolios. Any cash
made available by you to the Sponsors before the settlement date for those units
may be used in the Sponsors' businesses to the extent permitted by federal law
and may benefit the Sponsors.

A Sponsor or Underwriter may realize profits or sustain losses on bonds in the
Fund which were acquired from underwriting syndicates of which it was a member.
We bought approximately % of the bonds in the [State] Portfolio and % of
the bonds in the [State] Portfolio from one or more of the Sponsors (as sole
underwriter, managing underwriter or member of an underwriting syndicate).

During the initial offering period, the Sponsors also may realize profits or
sustain losses on units they hold. In maintaining a secondary market, the
Sponsors will also realize profits or sustain losses in the amount of any
difference between the prices at which they buy units and the prices at which
they resell or redeem them.

PUBLIC DISTRIBUTION

During the initial offering period, units will be distributed to the public by
the Sponsors and dealers who are members of the National Association of
Securities Dealers, Inc. This period is 30 days or less if all units are sold.
The Sponsors may extend the initial period up to 120 days.

The Sponsors do not intend to qualify units for sale in any foreign countries.
This prospectus does not constitute an offer to sell units in any country where
units cannot lawfully be sold.

22
<PAGE>
In the initial offering period, the concession to dealers will be $21 per 1,000
units. We may change the concession at any time. Dealers may resell units to
other dealers with a concession not in excess of the original concession to
dealers.

CODE OF ETHICS

Merrill Lynch, as agent for the Sponsors, has adopted a code of ethics requiring
preclearance and reporting of personal securities transactions by its employees
with access to information on portfolio transactions. The goal of the code is to
prevent fraud, deception or misconduct against the Fund and to provide
reasonable standards of conduct.

YEAR 2000 ISSUES

Many computer systems were designed in such a way that they may be unable to
distinguish between the year 2000 and the year 1900 (commonly known as the 'Year
2000 Problem'). We do not expect that the computer system changes necessary to
prepare for the Year 2000 will cause any major operational difficulties for the
Fund.

TAXES

The following summary describes some of the important income tax consequences of
holding units. It assumes that you are not a dealer, financial institution,
insurance company or other investor with special circumstances. You should
consult your own tax adviser about your particular circumstances.

At the date of issue of each bond, counsel for the issuer delivered an opinion
to the effect that interest on the bond is exempt from regular federal income
tax. However, interest may be subject to state and local taxes and federal
alternative minimum tax. Neither we nor our counsel have reviewed the issuance
of the bonds, related proceedings or the basis for the opinions of counsel for
the issuers. We cannot assure you that the issuer (or other users) have complied
or will comply with any requirements necessary for a bond to be tax-exempt. If
any of the bonds were determined not to be tax-exempt, you could be required to
pay income tax for current and prior years, and if the Fund were to sell the
bond, it might have to sell it at a substantial discount.

In the opinion of our counsel, under existing law:

GENERAL TREATMENT OF THE FUND AND YOUR INVESTMENT

The Fund will not be taxed as a corporation for federal income tax purposes, and
you will be considered to own directly your share of each bond in the Fund.

INCOME OR LOSS UPON DISPOSITION

When all or part of your share of a bond is disposed of (for example, when the
Fund sells, exchanges or redeems a bond or when you sell or exchange your
units), you will generally recognize capital gain or loss. Your gain, however,
will generally be ordinary income to the extent of any accrued 'market
discount'. Generally you will have market discount to the extent that your basis
in a bond when you purchase a unit is less than its stated redemption price at
maturity (or, if it is an original issue discount bond, the issue price
increased by original issue discount that has accrued on the bond before your
purchase).

23
<PAGE>
You should consult your tax adviser in this regard.

If your net long-term capital gains exceed your net short-term capital losses,
the excess may be subject to tax at a lower rate than ordinary income. Any
capital gain from the Fund will be long-term if you are considered to have held
your investment on each bond for more than one year and short-term if you held
it for one year or less. If you are an individual and sell your units after
holding them for more than 12 months, you may be entitled to a 20% maximum
federal tax rate on any resulting gains. Consult your tax adviser in this
regard. Because the deductibility of capital losses is subject to limitations,
you may not be able to deduct all of your capital losses.

YOUR BASIS IN THE BONDS

Your aggregate basis in the bonds will be equal to the cost of your units,
including any sales charges and the organizational expenses you pay, adjusted to
reflect any accruals of 'original issue discount,' 'acquisition premium' and
'bond premium'. You should consult your tax adviser in this regard.

EXPENSES

If you are not a corporate investor, you will not be entitled to a deduction for
your share of fees and expenses of the Fund. Also, if you borrowed money in
order to purchase or carry your units, you will not be able to deduct the
interest on this borrowing for federal income tax purposes. The IRS may treat
your purchase of units as made with borrowed money even if the money is not
directly traceable to the purchase of units.

STATE AND LOCAL TAXES

Under the income tax laws of the State and City of New York, the Fund will not
be taxed as a corporation. If you are a New York taxpayer, your income from the
Fund will not be tax-exempt in New York except to the extent that the income is
earned on bonds that are tax-exempt for New York purposes. Depending on where
you live, your income from the Fund may be subject to state and local taxation.
You should consult your tax adviser in this regard.

CALIFORNIA TAXES

In the opinion of O'Melveny & Myers LLP, Los Angeles, California, special
counsel on California tax matters:

Under the income tax laws of the State of California, the Trust will not be
taxed as a corporation and you will be considered to own directly your share of
each bond of the Trust. If you are a California taxpayer, your share of the
income from the bonds of the Trust will not be tax-exempt in California except
for California personal income tax purposes and only to the extent that the
income is earned on bonds that are exempt for such purposes. If you are a
California taxpayer and all or part of your share of a bond is disposed of (for
example, when a bond is sold, exchanged or redeemed at maturity or you sell or
exchange your units), you will recognize gain or loss for California tax
purposes. Depending on where you live, your income from the Trust may be subject
to state and local taxation. You should consult your tax advisor in this regard.

FLORIDA TAXES

In the opinion of Greenberg Traurig Hoffman Lipoff Rosen & Quentel, P.A., Miami,
Florida, special counsel on Florida tax matters:

24
<PAGE>
[TO COME]

SUPPLEMENTAL INFORMATION

You can receive at no cost supplemental information about the Fund by calling
the Trustee. The supplemental information includes more detailed risk disclosure
about the types of bonds that may be in the Fund's portfolios, general risk
disclosure concerning any insurance securing certain bonds, and general
information about the structure and operation of the Fund. The supplemental
information is also available from the SEC.

25
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS

The Sponsors, Trustee and Holders of Municipal Investment Trust Fund, Multistate
Series--401, Defined Asset Funds (California, Florida and New York Portfolios)
(the 'Fund'):

We have audited the accompanying statements of condition and the related defined
portfolios included in the prospectus of the Fund as of , 1998. These
financial statements are the responsibility of the Trustee. Our responsibility
is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. Our procedures included
confirmation of cash, securities and an irrevocable letter of credit deposited
for the purchase of securities, as described in the statements of condition,
with the Trustee. An audit also includes assessing the accounting principles
used and significant estimates made by the Trustee, 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 referred to above present fairly, in
all material respects, the financial position of the Fund as of ,
1998 in conformity with generally accepted accounting principles.

DELOITTE & TOUCHE LLP
New York, N.Y.
, 1998

STATEMENTS OF CONDITION AS OF , 1998

Trust Property

FLORIDA
CALIFORNIA INSURED INSURED NEW YORK
PORTFOLIO PORTFOLIO PORTFOLIO
-------------------- -------------------- --------------------
<S> <C> <C> <C>
Investments--Bonds and Contracts to purchase Bonds(1) $ $ $
Cash
Accrued interest to initial date of deposit on underlying
Bonds
-------------------- -------------------- --------------------
Total $ $ $
-------------------- -------------------- --------------------
-------------------- -------------------- --------------------
LIABILITIES AND INTEREST OF HOLDERS
Liabilities:
Advance by Trustee for accrued interest(2) $ $ $
Reimbursement of Sponsors for organization
expenses(3)
-------------------- -------------------- --------------------
Subtotal
-------------------- -------------------- --------------------
Interest of Holders of units of fractional undivided
interest outstanding
(California Insured Portfolio-- ; Florida Insured
Portfolio-- ; New York
Portfolio-- )
Cost to investors(3)(4)(5)
Organization expenses(3) and gross underwriting
commissions(4) () () ()
-------------------- -------------------- --------------------
Subtotal
-------------------- -------------------- --------------------
Total $ $ $
-------------------- -------------------- --------------------
-------------------- -------------------- --------------------

</TABLE>

- ---------------
(1) Aggregate cost to the Fund of the bonds listed under each portfolio
is based upon the offer side evaluation determined by the Evaluator at the
evaluation time on the business day prior to the initial date of deposit. The
contracts to purchase the bonds are collateralized by an irrevocable letter of
credit which has been issued by Bank, New York Branch, in the amount
of $ deposited with the Trustee. The amount of the letter of credit
includes $ for the purchase of $ face amount of the
bonds, plus $ for accrued interest.
(2) Representing a special distribution to the Sponsors by the Trustee
of an amount equal to the accrued interest on the bonds.
(3) A portion of the Unit Price consists of cash in an amount
sufficient to pay for costs incurred in establishing the Fund. These costs have
been estimated at $ per 1,000 Units. A distribution will be made at the close
of the initial offering period to an account maintained by the Trustee from
which the organizational expense obligation of the investors to the Sponsors
will be satisfied.

(4) Assumes the maximum up-front sales fee per 1,000 units of 1.00% of
the Public Offering Price. A deferred sales fee of $19.00 per 1,000 units is
payable over a two-year period ($2.38 per 1,000 units quarterly in the first
year and $2.37 per 1,000 units quarterly in the second year). Distributions will
be made to an account maintained by the Trustee from which the deferred sales
fee obligation of the investors will be satisfied. If units are redeemed prior
to the end of second anniversary of the Fund, the remaining portion of the
deferred sales fee applicable to such units will be transferred to the account
on the redemption date.
(5) Aggregate Unit Price (exclusive of interest) computed on the basis
of the offer side evaluation of the underlying bonds as of the evaluation time
on the business day prior to the Initial Date of Deposit.

26
<PAGE>
Defined
Asset FundsSM

HAVE QUESTIONS ? MUNICIPAL INVESTMENT TRUST FUND
Request the most MULTISTATE SERIES 401
recent free Information (A Unit Investment Trust)
Supplement that gives more ---------------------------------------
details about the Fund, This Prospectus does not contain
by calling: complete information about the
The Chase Manhattan Bank investment company filed with the
1-800-323-1508 Securities and Exchange Commission in
Washington, D.C. under the:
o Securities Act of 1933 (file no.
333-57375) and
o Investment Company Act of 1940 (file
no. 811-1777).

TO OBTAIN COPIES AT PRESCRIBED RATES--
WRITE: Public Reference Section of the
Commission
450 Fifth Street, N.W., Washington,
D.C. 20549-6009
CALL: 1-800-SEC-0330.
VISIT: http://www.sec.gov.
---------------------------------------
No person is authorized to give any
information or representations about
this Fund not contained in this
Prospectus or the Information
Supplement, and you should not rely on
any other information.
---------------------------------------
When units of this Fund are no longer
available, this Prospectus may be used
as a preliminary prospectus for a
future series, but some of the
information in this Prospectus will be
changed for that series.
Units of any future series may not be
sold nor may offers to buy be accepted
until that series has become effective
with the Securities and Exchange
Commission. No units can be sold in any
State where a sale would be illegal.

--9/98

<PAGE>
PART II
ADDITIONAL INFORMATION NOT INCLUDED IN THE PROSPECTUS

A. The following information relating to the Depositors is incorporated by
reference to the SEC filings indicated and made a part of this Registration
Statement.

I. Bonding arrangements of each of the Depositors are incorporated by reference
to Item A of Part II to the Registration Statement on Form S-6 under the
Securities Act of 1933 for Municipal Investment Trust Fund, Monthly Payment
Series--573 Defined Asset Funds (Reg. No. 333-08241).

II. The date of organization of each of the Depositors is set forth in Item B
of Part II to the Registration Statement on Form S-6 under the Securities Act of
1933 for Municipal Investment Trust Fund, Monthly Payment Series--573 Defined
Asset Funds (Reg. No. 333-08241) and is herein incorporated by reference
thereto.

III. The Charter and By-Laws of each of the Depositors are incorporated herein
by reference to Exhibits 1.3 through 1.12 to the Registration Statement on Form
S-6 under the Securities Act of 1933 for Municipal Investment Trust Fund,
Monthly Payment Series--573 Defined Asset Funds (Reg. No. 333-08241).

IV. Information as to Officers and Directors of the Depositors has been filed
pursuant to Schedules A and D of Form BD under Rules 15b1-1 and 15b3-1 of the
Securities Exchange Act of 1934 and is incorporated by reference to the SEC
filings indicated and made a part of this Registration Statement:

Merrill Lynch, Pierce, Fenner & Smith Incorporated 8-7221
Smith Barney Inc. ........................................ 8-8177
PaineWebber Incorporated.................................. 8-16267
Dean Witter Reynolds Inc. ................................ 8-14172

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

B. The Internal Revenue Service Employer Identification Numbers of the
Sponsors and Trustee are as follows:

Merrill Lynch, Pierce, Fenner & Smith Incorporated 13-5674085
Smith Barney Inc. ........................................ 13-1912900
PaineWebber Incorporated.................................. 13-2638166
Dean Witter Reynolds Inc. ................................ 94-0899825
The Chase Manhattan Bank, Trustee......................... 13-4994650

UNDERTAKING
The Sponsors undertake that they will not instruct the Trustee to accept from
(i) Asset Guaranty Reinsurance Company, Municipal Bond Investors Assurance
Corporation or any other insurance company affiliated with any of the Sponsors,
in settlement of any claim, less than an amount sufficient to pay any principal
or interest (and, in the case of a taxability redemption, premium) then due on
any Security in accordance with the municipal bond guaranty insurance policy
attached to such Security or (ii) any affiliate of the Sponsors who has any
obligation with respect to any Security, less than the full amount due pursuant
to the obligation, unless such instructions have been approved by the Securities
and Exchange Commission pursuant to Rule 17d-1 under the Investment Company Act
of 1940.

II-1
<PAGE>
CONTENTS OF REGISTRATION STATEMENT
The Registration Statement on Form S-6 comprises the following papers and
documents:

The facing sheet of Form S-6.

The Cross-Reference Sheet (incorporated by reference to the Cross-Reference
Sheet to the Registration Statement of Defined Asset Funds Municipal Series,
1933 Act File No. 33-54565).

The Prospectus.

Additional Information not included in the Prospectus (Part II).

The following exhibits:

1.1 --Form of Trust Indenture.
1.1.1 --Form of Standard Terms and Conditions of Trust Effective October 21,
1993 (incorporated by reference to Exhibit 1.1.1 to the Registration
Statement of Municipal Investment Trust Fund, Multistate Series-48,
1933 Act File No. 33-50247).
1.2 --Form of Master Agreement Among Underwriters (incorporated by reference
to Exhibit 1.2 to the Registration Statement of The Corporate Income
Fund, One Hundred Ninety-Fourth Monthly Payment Series, 1933 Act File
No. 2-90925).
2.1 --Form of Certificate of Beneficial Interest (included in Exhibit
1.1.1).
*3.1 --Opinion of counsel as to the legality of the securities being issued
including their consent to the use of their name under the headings
'How The Fund Works--'Legal Opinion' in the Prospectus.
*4.1 --Consent of the Evaluator.
*5.1 --Consent of independent accountants.
9.1 --Information Supplement (incorporated by reference to Exhibit 9.1 to
the Registration Statement of Municipal Investment Trust Fund,
Multistate Series--30, 1933 Act File No. 333-49353).

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

*To be filed by amendment.

R-1
<PAGE>
DEFINED ASSET FUNDS
MUNICIPAL INVESTMENT TRUST FUND
MULTISTATE SERIES
SIGNATURES

PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT OR AMENDMENT TO THE REGISTRATION
STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED THEREUNTO DULY
AUTHORIZED IN THE CITY OF NEW YORK AND STATE OF NEW YORK ON THE 28TH DAY OF
AUGUST, 1998.

SIGNATURES APPEAR ON PAGES R-3, R-4, R-5 AND R-6.

A majority of the members of the Board of Directors of Merrill Lynch,
Pierce, Fenner & Smith Incorporated has signed this Registration Statement or
Amendment to the Registration Statement pursuant to Powers of Attorney
authorizing the person signing this Registration Statement or Amendment to the
Registration Statement to do so on behalf of such members.

A majority of the members of the Board of Directors of Smith Barney Inc.
has signed this Registration Statement or Amendment to the Registration
Statement pursuant to Powers of Attorney authorizing the person signing this
Registration Statement or Amendment to the Registration Statement to do so on
behalf of such members.

A majority of the members of the Executive Committee of the Board of
Directors of PaineWebber Incorporated has signed this Registration Statement or
Amendment to the Registration Statement pursuant to Powers of Attorney
authorizing the person signing this Registration Statement or Amendment to the
Registration Statement to do so on behalf of such members.

A majority of the members of the Board of Directors of Dean Witter Reynolds
Inc. has signed this Registration Statement or Amendment to the Registration
Statement pursuant to Powers of Attorney authorizing the person signing this
Registration Statement or Amendment to the Registration Statement to do so on
behalf of such members.

R-2
<PAGE>
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
DEPOSITOR

By the following persons, who constitute Powers of Attorney have been filed
a majority of under
the Board of Directors of Merrill Form SE and the following 1933 Act
Lynch, Pierce, File
Fenner & Smith Incorporated: Number: 33-43466 and 33-51607

HERBERT M. ALLISON, JR.
BARRY S. FREIDBERG
EDWARD L. GOLDBERG
STEPHEN L. HAMMERMAN
JEROME P. KENNEY
DAVID H. KOMANSKY
DANIEL T. NAPOLI
THOMAS H. PATRICK
JOHN L. STEFFENS
ROGER M. VASEY
ARTHUR H. ZEIKEL
DANIEL C. TYLER
(As authorized signatory for Merrill Lynch, Pierce,
Fenner & Smith Incorporated and
Attorney-in-fact for the persons listed above)

R-3
<PAGE>
SMITH BARNEY INC.
DEPOSITOR

By the following persons, who constitute a majority of Powers of Attorney
the Board of Directors of Smith Barney Inc.: have been filed
under the 1933 Act
File Numbers:
33-49753,
33-55073,
333-41765 and
333-10441

JAMES DIMON
DERYCK C. MAUGHAN

By GINA LEMON
(As authorized signatory for
Smith Barney Inc. and
Attorney-in-fact for the persons listed above)

R-4
<PAGE>
PAINEWEBBER INCORPORATED
DEPOSITOR

By the following persons, who constitute Powers of Attorney have been filed
the Board of Directors of PaineWebber under
Incorporated: the following 1933 Act File
Number: 2-61279

MARGO N. ALEXANDER
TERRY L. ATKINSON
BRIAN M. BAREFOOT
STEVEN P. BAUM
MICHAEL CULP
REGINA A. DOLAN
JOSEPH J. GRANO, JR.
EDWARD M. KERSCHNER
JAMES P. MacGILVRAY
DONALD B. MARRON
ROBERT H. SILVER
MARK B. SUTTON
By
ROBERT E. HOLLEY
(As authorized signatory for
PaineWebber Incorporated
and Attorney-in-fact for the persons listed above)

R-5
<PAGE>
DEAN WITTER REYNOLDS INC.
DEPOSITOR

By the following persons, who constitute Powers of Attorney have been filed
a majority of under Form SE and the following 1933
the Board of Directors of Dean Witter Act File Numbers: 33-17085 and
Reynolds Inc.: 333-13039

RICHARD M. DeMARTINI
ROBERT J. DWYER
CHRISTINE A. EDWARDS
CHARLES A. FIUMEFREDDO
JAMES F. HIGGINS
MITCHELL M. MERIN
STEPHEN R. MILLER
RICHARD F. POWERS III
PHILIP J. PURCELL
THOMAS C. SCHNEIDER
WILLIAM B. SMITH
By
MICHAEL D. BROWNE
(As authorized signatory for
Dean Witter Reynolds Inc.
and Attorney-in-fact for the persons listed above)

R-6