ALLIANCE CAPITAL RESERVES, 497, 1995-11-08

ALLIANCE CAPITAL RESERVES
497, 1995-11-08

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This is filed pursuant to Rule 497(c).
File Nos. 002-61564 and 811-02835.

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YIELD MESSAGES

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For current recorded yield information on Alliance Capital Reserves, call on a
touch-tone telephone toll-free (800) 251-0539 and press the following sequence
of keys: [1] [#] [1] [#] [3] [9] [#]. For non-touch-tone telephones, call
toll-free (800) 221-9513.
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Alliance Capital Reserves (the "Fund") is a series of Alliance Capital
Reserves, a diversified, open-end investment company with investment
objectives of safety, liquidity and income. This prospectus sets forth the
information about the Fund that a prospective investor should know before
investing. Please retain it for future reference.

An investment in the Fund is (i) neither insured nor guaranteed by the U.S.
Government; (ii) not a deposit or obligation of, or guaranteed or endorsed by,
any bank; and (iii) not federally insured by the Federal Deposit Insurance
Corporation, the Federal Reserve Board or any other agency. There can be no
assurance that the Fund will be able to maintain a stable net asset value of
$1.00 per share.

A "Statement of Additional Information," dated November 1, 1995, which
provides a further discussion of certain areas in this prospectus and other
matters which may be of interest to some investors, has been filed with the
Securities and Exchange Commission and is incorporated herein by reference.
For a free copy, call (800) 221-5672 or write Alliance Fund Services, Inc. at
the address shown on page 7.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.

(R) This registered service mark used under license from the owner, Alliance
Capital Management L.P.

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CONTENTS
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<TABLE>
<S> <C>
Expense Information....................................................... 2
Financial Highlights...................................................... 2
Introduction.............................................................. 3
Investment Objectives and Policies........................................ 4
Purchase and Redemption of Shares......................................... 5
Additional Information.................................................... 6
</TABLE>
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ALLIANCE
CAPITAL
RESERVES

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[LOGO OF ALLIANCE CAPITAL APPEARS HERE]

PROSPECTUS
NOVEMBER 1, 1995

ALC90PRO5
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<PAGE>

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EXPENSE INFORMATION
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SHAREHOLDER TRANSACTION EXPENSES
The Fund has no sales load on purchases or reinvested dividends, deferred
sales load, redemption fee or exchange fee.

<TABLE>
<CAPTION>
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets)
<S> <C>
Management Fees............................................ .48%
12b-1 Fees................................................. .25
Other Expenses............................................. .27
----
Total Fund Operating Expenses.............................. 1.00%
</TABLE>
<TABLE>
<CAPTION>
EXAMPLE
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
You would pay the following expenses on a
$1,000 investment, assuming a 5% annual
return (cumulatively through the end of
each time period): $10 $32 $55 $122
</TABLE>

The purpose of the foregoing table is to assist the investor in understand-
ing the various costs and expenses that an investor in the Fund will bear di-
rectly and indirectly. The example should not be considered a representation
of past or future expenses; actual expenses may be greater or less than those
shown.

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FINANCIAL HIGHLIGHTS . FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR (AUDITED)
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The following tables have been audited by McGladrey & Pullen LLP, the Fund's
independent auditors, whose report thereon appears in the Statement of Addi-
tional Information. This information should be read in conjunction with the
financial statements and notes thereto included in the Statement of Additional
Information.

<TABLE>
<CAPTION>
YEAR ENDED JUNE 30,
---------------------------------------------------------------------------------
1995 1994 1993 1992 1991 1990 1989 1988 1987 1986
------ ------ ------ ------ ------ ------ ------ ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of period.... $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
------ ------ ------ ------ ------ ------ ------ ------- ------- -------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income... .0447 .0255 .0266 .0438 .0662 .0782 .0788 0.0625 0.0549 0.0685
Net realized gain on
investments............ -0- -0- .0003 .0013 -0- -0- -0- -0- -0- -0-
------ ------ ------ ------ ------ ------ ------ ------- ------- -------
Net increase in net
assets from operations. .0447 .0255 .0269 .0451 .0662 .0782 .0788 0.0625 0.0549 0.0685
------ ------ ------ ------ ------ ------ ------ ------- ------- -------
LESS: DISTRIBUTIONS
Dividends from net
investment income...... (.0447) (.0255) (.0266) (.0438) (.0662) (.0782) (.0788) (0.0625) (0.0549) (0.0685)
Distributions from net
realized gains......... -0- -0- (.0003) (.0013) -0- -0- -0- -0- -0- -0-
------ ------ ------ ------ ------ ------ ------ ------- ------- -------
Total dividends and
distributions.......... (.0447) (.0255) (.0269) (.0451) (.0662) (.0782) (.0788) (0.0625) (0.0549) (0.0685)
------ ------ ------ ------ ------ ------ ------ ------- ------- -------
Net asset value, end of
period................. $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
====== ====== ====== ====== ====== ====== ====== ======= ======= =======
TOTAL RETURNS
Total investment return
based on:
Net asset value(a)..... 4.57% 2.58% 2.73% 4.61% 6.84% 8.14% 8.20% 6.45% 5.64% 7.09%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of year
(in millions).......... $3,024 $2,417 $2,112 $1,947 $1,937 $1,891 $1,536 $1,392 $1,458 $1,198
Ratio to average net
assets of:
Expenses, net of
waivers and
reimbursements........ 1.00% 1.00% 1.00% 1.00% .97% .88% .95% .95% .99% 1.01%
Expenses, before
waivers and
reimbursements........ 1.03% 1.03% 1.00% 1.00% .97% .98% 1.05% 1.05% 1.09% 1.11%
Net investment
income(b)............. 4.51% 2.57% 2.65% 4.37% 6.62% 7.82% 7.87% 6.26% 5.50% 6.85%
</TABLE>
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(a) 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.
(b) Net of waivers and reimbursements.
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From time to time the Fund advertises its "yield" and "effective yield."
Both yield figures are based on historical earnings and are not intended to
indicate future performance. To calculate the "yield," the amount of dividends
paid on a share during a specified seven-day period is assumed to be paid each
week over a 52-week period and is shown as a percentage of the investment. To
calculate "effective yield," which will be higher than the "yield" because of
compounding, the dividends paid are assumed to be reinvested. Dividends for
the seven days ended June 30, 1995 amounted to an annualized yield of 5.12%,
equivalent to an effective yield of 5.25%.

2
<PAGE>

ALLIANCE CAPITAL RESERVES . . . . . . . with investment objectives of
------------------------

SAFETY . LIQUIDITY . INCOME

We seek safety for the Fund by investing in a broadly diversified
list of money market securities which are selected for their high
quality, liquidity and stability of principal. Liquidity of the in-
vestment portfolio is increased even more by our emphasis on short-
term issues. Specifically, at the time of investment no security pur-
chased can have a maturity exceeding one year, which maturity may ex-
tend to 397 days, and the average maturity of the portfolio cannot ex-
ceed 90 days.

The short average maturity of the portfolio enhances our ability to
maintain the Fund's share price at $1.00--this, in turn, provides both
stability of value and liquidity to you and your fellow shareholders.

Our professional investment managers seek the maximum current income
for the Fund that is consistent with safety and maintenance of liquid-
ity. In addition to their knowledge and experience with money markets,
our managers obtain yield advantages for the Fund by making many secu-
rity purchases in especially large amounts such as $1 million and mul-
tiples thereof. Persons investing for themselves usually cannot ex-
ploit such money market opportunities due to the large investment
sizes required.

WHO SHOULD INVEST IN THE FUND?

The Fund is designed for individuals, brokers, institutions, advis-
ers, custodians, charities, fiduciaries, or corporations who can bene-
fit from high money market income--and who place value on an invest-
ment having safety, liquidity, stability, simplicity, and convenience.
Investors using the Fund avoid certain mechanical burdens that they
would incur by investing in money markets directly, such as monitoring
of maturity dates, safeguarding of receipts and deliveries, and the
maintenance of tax information and other records.

MAJOR FEATURES AND SERVICES OF ALLIANCE CAPITAL RESERVES

No sales charges Same-day funds for withdrawals
No withdrawal fees or penalties Free check-writing ($100 minimum per check)
Low-expense Distribution Plan Free institutional record-keeping services
(.25 of 1% maximum annual rate) IRA, SEP, 403 (b) (7) and employer-
Daily compounding of dividends sponsored retirement plans
First-day income for investments Low investment minimums

3
<PAGE>

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INVESTMENT OBJECTIVES AND POLICIES
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The Fund's investment objectives are--in the following order of priority--
safety of principal, excellent liquidity, and maximum current income to the ex-
tent consistent with the first two objectives. As a matter of fundamental poli-
cy, the Fund pursues its objectives by maintaining a portfolio of high quality
money market securities, all of which at the time of investment have remaining
maturities of one year or less, which maturities may extend to 397 days. While
the Fund may not change this policy or the "other fundamental investment poli-
cies" described in a separate section below without shareholder approval, it
may, upon notice to shareholders, but without such approval, change the follow-
ing investment policies or create additional classes of shares in order to es-
tablish portfolios which may have different investment objectives. There can be
no assurance, as is true with all investment companies, that the Fund's objec-
tives will be achieved.

MONEY MARKET SECURITIES

The money market securities in which the Fund invests include: (1) marketable
obligations of, or guaranteed by, the United States Government, its agencies or
instrumentalities (collectively, the "U.S. Government"); (2) certificates of
deposit, bankers' acceptances and interest-bearing savings deposits issued or
guaranteed by banks or savings and loan associations having total assets of
more than $1 billion and which are members of the Federal Deposit Insurance
Corporation and certificates of deposit and bankers' acceptances denominated in
U.S. dollars and issued by U.S. branches of foreign banks having total assets
of at least $1 billion that are believed by the Adviser to be of quality equiv-
alent to that of other such instruments in which the Fund may invest; (3) com-
mercial paper of prime quality [i.e., rated A-1+ or A-1 by Standard & Poor's
Corporation ("Standard & Poor's") or Prime-1 by Moody's Investors Service, Inc.
("Moody's") or, if not rated, issued by companies having outstanding debt secu-
rities rated AAA or AA by Standard & Poor's, or Aaa or Aa by Moody's] and par-
ticipation interests in loans extended by banks to such companies; and (4) re-
purchase agreements that are collateralized in full each day by liquid securi-
ties of the types listed above. These agreements are entered into with "primary
dealers" (as designated by the Federal Reserve Bank of New York) in U.S. Gov-
ernment securities or State Street Bank and Trust Company, the Fund's Custodi-
an, and would create a loss to the Fund if, in the event of a dealer default,
the proceeds from the sale of the collateral were less than the repurchase
price. The Fund may also invest in certificates of deposit issued by, and time
deposits maintained at, foreign branches of domestic banks described in (2)
above and prime quality dollar-denominated commercial paper issued by foreign
companies meeting the criteria specified in (3) above.

The Fund may purchase restricted securities that are determined by the Ad-
viser to be liquid in accordance with procedures adopted by the Trustees of the
Fund. Restricted securities are securities subject to contractual or legal re-
strictions on resale, such as those arising from an issuer's reliance upon cer-
tain exemptions from registration under the Securities Act of 1933 (the "Secu-
rities Act"). The Fund may purchase restricted securities eligible for resale
under Rule 144A under the Securities Act and commercial paper issued in reli-
ance upon the exemption from registration in Section 4(2) of the Securities Act
and, in each case, determined by the Adviser to be liquid in accordance with
procedures adopted by the Trustees of the Fund.

The Fund may invest in asset-backed securities that meet its existing diver-
sification, quality and maturity criteria. Asset-backed securities are securi-
ties issued by special purpose entities whose primary assets consist of a pool
of loans or accounts receivable. The securities may be in the form of a benefi-
cial interest in a special purpose trust, limited partnership interest, or com-
mercial paper or other debt securities issued by a special purpose

4
<PAGE>

corporation. Although the securities may have some form of credit or liquidity
enhancement, payments on the securities depend predominately upon collection of
the loans and receivables held by the issuer. It is the Fund's current inten-
tion to limit its investment in such securities to not more than 5% of its net
assets.

The Fund will comply with Rule 2a-7 under the Investment Company Act of 1940
(the "Act"), as amended from time to time, including the diversity, quality and
maturity limitations imposed by the Rule. A more detailed description of Rule
2a-7 is set forth in the Fund's Statement of Additional Information under "In-
vestment Objectives and Policies."

OTHER FUNDAMENTAL INVESTMENT POLICIES

To maintain portfolio diversification and reduce investment risk, the Fund
may not: (1) invest more than 25% of its assets in the securities of issuers
conducting their principal business activities in any one industry although
there is no such limitation with respect to U.S. Government securities or cer-
tificates of deposit, bankers' acceptances and interest bearing savings depos-
its; (2) invest more than 5% of its assets in securities of any one issuer (ex-
cept the U.S. Government) although with respect to one-quarter of its total as-
sets it may invest without regard to such limitation; (3) invest more than 5%
of its assets in the securities of any issuer (except the U.S. Government) hav-
ing less than three years of continuous operation or purchase more than 10% of
any class of the outstanding securities of any issuer (except the U.S. Govern-
ment); (4) borrow money except from banks on a temporary basis or via entering
into reverse repurchase agreements in aggregate amounts not exceeding 15% of
its assets and to facilitate the orderly maturation and sale of portfolio secu-
rities during any periods of abnormally heavy redemption requests; or (5) mort-
gage, pledge or hypothecate its assets except to secure such borrowings.

As a matter of operating policy, fundamental policy number (2) would give the
Fund the ability to invest, with respect to 25% of its assets, more than 5% of
its assets in any one issuer only in the event Rule 2a-7 is amended in the fu-
ture.

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PURCHASE AND REDEMPTION OF SHARES
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OPENING ACCOUNTS

Instruct your Account Executive to open an account in the Fund in conjunction
with your brokerage account.

SUBSEQUENT INVESTMENTS

A. BY CHECK THROUGH YOUR BROKERAGE FIRM

Mail or deliver your check made payable to your brokerage firm to your Ac-
count Executive who will deposit it into your brokerage account. Please indi-
cate your account number on the check.

B. BY SWEEP

Your brokerage firm may offer an automatic "sweep" for the Fund in the opera-
tion of brokerage cash accounts for its customers. Contact your Account Execu-
tive to determine if a sweep is available and what the sweep parameters are.

REDEMPTIONS

A. BY CHECKWRITING

With this service, you may write checks made payable to any payee in any
amount of $100 or more. Checks cannot be written for more than the principal
balance (not including any accrued dividends) in your account. You must first
fill out the Signature Card, which you can obtain from your Account Executive.
There is no additional charge for the checkwriting service. The checkwriting
service enables you to receive the daily dividends declared on the shares to be
redeemed until the day that your check is presented for payment.

B. BY SWEEP

If your brokerage firm offers an automatic sweep service, the sweep will au-
tomatically transfer

5
<PAGE>

from your Fund account sufficient cash to cover any debit balance that may oc-
cur in your cash account for any reason.

OPENING AN ACCOUNT DIRECTLY WITH THE FUND; SHAREHOLDER SERVICES

If you wish to obtain an Application Form to open an account directly with
the Fund or if you have any questions about the Form, purchasing shares or
other Fund procedures, please telephone the Fund toll-free (800) 221-5672.

For more information on the purchase and redemption of Fund shares, as well
as shareholder services, see the Statement of Additional Information.

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ADDITIONAL INFORMATION
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SHARE PRICE. Shares are sold and redeemed on a continuous basis without sales
or redemption charges at their net asset value which is expected to be con-
stant at $1.00 per share, although this price is not guaranteed. The net asset
value of the Fund's shares is determined at 12:00 Noon and 4:00 p.m. (New York
time) each business day. The net asset value per share is calculated by taking
the sum of the value of the Fund's investments (amortized cost value is used
for this purpose) and any cash or other assets, subtracting liabilities, and
dividing by the total number of shares outstanding. All expenses, including
the fees payable to the Adviser, are accrued daily.

TIMING OF INVESTMENTS AND REDEMPTIONS. The Fund has two transaction times
each business day, 12:00 Noon and 4:00 p.m. (New York time). New investments
represented by Federal funds or bank wire monies received by State Street Bank
at any time during a day prior to 4:00 p.m. are entitled to the full dividend
to be paid to shareholders for that day. Shares do not earn dividends on the
day a redemption is effected regardless of whether the redemption order is re-
ceived before or after 12:00 Noon. However, if you wish to have Federal funds
wired the same day as your telephone redemption request, make sure that your
request will be received by the Fund prior to 12:00 Noon.

During periods of drastic economic or market developments, such as the market
break of October 1987, it is possible that shareholders would have difficulty
in reaching Alliance Fund Services, Inc. by telephone (although no such diffi-
culty was apparent at any time in connection with the 1987 market break). If a
shareholder were to experience such difficulty, the shareholder should issue
written instructions to Alliance Fund Services, Inc. at the address shown on
page 7 of this prospectus. The Fund reserves the right to suspend or terminate
its telephone redemption service at any time without notice. Neither the Fund
nor the Adviser, or Alliance Fund Services, Inc. will be responsible for the
authenticity of telephone requests for redemptions that the Fund reasonably
believes to be genuine. The Fund will employ reasonable procedures in order to
verify that telephone requests for redemptions are genuine, including among
others, recording such telephone instructions and causing written confirma-
tions of the resulting transactions to be sent to shareholders. If the Fund
did not employ such procedures, it could be liable for losses arising from un-
authorized or fraudulent telephone instructions. Selected dealers or agents
may charge a commission for handling telephone requests for redemptions.

Redemption proceeds are normally wired or mailed either the same or the next
business day, but in no event later than seven days, unless redemptions have
been suspended or postponed due to the determination of an "emergency" by the
Securities and Exchange Commission or to certain other unusual conditions.

If your Fund shares are not maintained through a financial intermediary, pro-
ceeds from any subsequent redemption by you of Fund shares that were purchased
by check or electronic funds transfer will not be forwarded to you until the
Fund is reasonably

6
<PAGE>

assured that your check or electronic funds transfer has cleared, up to fifteen
days following the purchase date. If the redemption request during such period
is in the form of a Fund check, the check will be marked "insufficient funds"
and be returned unpaid to the presenting bank.

MINIMUMS. The Fund has minimums of $1,000 for initial investments, $100 for
subsequent investments and a $500 minimum maintenance balance for each account.
These minimums do not apply to shareholder accounts maintained through broker-
age firms or other financial institutions, as such financial intermediaries may
maintain their own minimums. The Fund imposes a service charge upon financial
intermediaries to reflect the relatively higher costs of small accounts and
small transactions; these intermediaries may in turn pass on such charges to
affected accounts. Accounts not maintained through a financial intermediary are
notified of low balances and required to increase their balance or be subject
to liquidation of their account. See the Statement of Additional Information
for further information.

DAILY DIVIDENDS, OTHER DISTRIBUTIONS, TAXES. All net income of the Fund is de-
termined each business day at 4:00 p.m. (New York time) and is paid immediately
thereafter pro rata to shareholders of record via automatic investment in addi-
tional full and fractional shares in each shareholder's account. As such addi-
tional shares are entitled to dividends on following days, a compounding growth
of income occurs.

Net income consists of all accrued interest income on Fund assets less the
Fund's expenses applicable to that dividend period. Realized gains and losses
are reflected in net asset value and are not included in net income.

For Federal income tax purposes, distributions out of interest income earned
by the Fund and net realized short-term capital gains are taxable to you as or-
dinary income, and distributions of net realized long-term capital gains, if
any, are taxable as long-term capital gains irrespective of the length of time
you may have held your shares. Distributions by the Fund may also be subject to
certain state and local taxes. Each year shortly after December 31, the Fund
will send you tax information stating the amount and type of all its distribu-
tions for the year just ended.

THE ADVISER. The Fund retains Alliance Capital Management L.P., 1345 Avenue of
the Americas, New York, NY 10105 under an Advisory Agree- ment to provide in-
vestment advice and, in general, to conduct the Fund's management and invest-
ment program, subject to the general supervision and control of the Trustees of
the Fund. For the fiscal year ended June 30, 1995, the Fund paid the Adviser a
fee equal to .46 of 1% of the average daily value of the Fund's net assets.

Under a Distribution Services Agreement (the "Agreement"), the Fund makes pay-
ments to the Adviser at a maximum annual rate of .25 of 1% of the Fund's aggre-
gate average daily net assets. For the fiscal year ended June 30, 1995, the
Fund paid the Adviser at an annual rate of .25 of 1% of the average daily value
of the Fund's net assets. Substantially all such monies (together with signifi-
cant amounts from the Adviser's own resources) are paid by the Adviser to bro-
ker-dealers and other financial intermediaries for their distribution assis-
tance and to banks and other depository institutions for administrative and ac-
counting services provided to the Fund, with any remaining amounts being used
to partially defray other expenses incurred by the Adviser in distributing Fund
shares. The Fund believes that the administrative services provided by deposi-
tory institutions are permissible activities under present banking laws and
regulations and will take appropriate actions (which should not adversely af-
fect the Fund or its shareholders) in the future to maintain such legal confor-
mity should any changes in, or interpretations of, such laws or regulations oc-
cur.

The Adviser will reimburse the Fund to the extent that the Fund's aggregate
operating expenses (including the Adviser's fee and expenses of the Agreement)
exceed 1% of its average daily net assets for any fiscal year.

CUSTODIAN, TRANSFER AGENT AND DISTRIBUTOR. State Street Bank and Trust Compa-
ny, P.O. Box 1912, Boston, MA 02105, is the Fund's Custodian. Alliance Fund
Services, Inc., P.O. Box 1520, Secaucus,

7
<PAGE>

NJ 07096-1520 and Alliance Fund Distributors, Inc., 1345 Avenue of the Ameri-
cas, New York, NY 10105, are the Fund's Transfer Agent and Distributor, respec-
tively. The transfer agent charges a fee for its services.

FUND ORGANIZATION. The Fund is a series of Alliance Capital Reserves (the
"Trust"). The Fund is one of two series of the Trust; shares of the other se-
ries, Alliance Money Reserves, are offered by a separate prospectus. The Trust
is a diversified, open-end investment company registered under the Act. The
Trust was reorganized as a Massachusetts business trust in October 1984, having
previously been a Maryland Corporation since its formation in April 1978. The
Trust's activities are supervised by its Trustees. Normally, each share of each
series is entitled to one vote, and vote as a single series on matters that af-
fect both series in substantially the same manner. Massachusetts law does not
require annual meetings of shareholders and it is anticipated that shareholder
meetings will be held only when required by Federal law. Shareholders have
available certain procedures for the removal of Trustees.

REPORTS. You receive semi-annual and annual reports of the Fund as well as a
monthly summary of your account. You can arrange for a copy of each of your ac-
count statements to be sent to other parties.

TRUSTEES
Dave H. Williams, Chairman
John D. Carifa
Sam Y. Cross
Charles H. P. Duell
William H. Foulk, Jr.
Elizabeth J. McCormack
David K. Storrs
Shelby White
John Winthrop

OFFICERS
Ronald M. Whitehill, President
John R. Bonczek, Senior Vice President
Kathleen A. Corbet, Senior Vice President
Robert I. Kurzweil, Senior Vice President
Wayne D. Lyski, Senior Vice President
Patricia Netter, Senior Vice President
Ronald R. Valeggia, Senior Vice President
Drew Biegel, Vice President
John F. Chiodi, Jr., Vice President
Doris T. Ciliberti, Vice President
William J. Fagan, Vice President
Linda D. Neil, Vice President
Raymond J. Papera, Vice President
Pamela F. Richardson, Vice President
Mark D. Gersten, Treasurer & Chief Financial Officer
Edmund P. Bergan, Jr., Secretary

<PAGE>

This is filed pursuant to Rule 497(c).
File Nos. 002-61564 and 811-02835.

<PAGE>

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YIELD MESSAGES
For current recorded yield information on Alliance Money Reserves, call on a
touch-tone telephone toll-free (800) 251-0539 and press the following sequence
of keys: [1] [#] [1] [#] [3] [6] [#]. For non-touch-tone telephones, call
toll-free (800) 221-9513.
- --------------------------------------------------------------------------------

Alliance Money Reserves (the
"Fund") is a series of Alliance
Capital Reserves, a diversified,
open-end management investment com-
pany with an investment objective
of maximum current income to the
extent consistent with safety of
principal and liquidity. This pro-
spectus sets forth the information
about the Fund that a prospective
investor should know before invest-
ing. Please retain it for future
reference.

An investment in the Fund is (i)
neither insured nor guaranteed by
the U.S. Government; (ii) not a de-
posit or obligation of, or guaran-
teed or endorsed by, any bank; and
(iii) not federally insured by the
Federal Deposit Insurance Corpora-
tion, the Federal Reserve Board or
any other agency. There can be no
assurance that the Fund will be
able to maintain a stable net asset
value of $1.00 per share.

A "Statement of Additional Infor-
mation," dated November 1, 1995,
which provides a further discussion
of certain areas in this prospectus
and other matters which may be of
interest to some investors, has
been filed with the Securities and
Exchange Commission and is incorpo-
rated herein by reference. For a
free copy, call (800) 221-5672 or
write Alliance Fund Services, Inc.
at the address shown on page 8.

THESE SECURITIES HAVE NOT BEEN AP-
PROVED OR DISAPPROVED BY THE SECU-
RITIES AND EXCHANGE COMMISSION OR
ANY STATE SECURITIES COMMISSION NOR
HAS THE SECURITIES AND EXCHANGE
COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

(R) This registered service mark
used under license from the owner,
Alliance Capital Management L.P.

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CONTENTS
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<TABLE>
<S> <C>
Expense Information....................................................... 2
Financial Highlights...................................................... 2
Introduction.............................................................. 3
Investment Objective and Policies......................................... 4
Purchase and Redemption of Shares......................................... 5
Additional Information.................................................... 6
</TABLE>
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
ALLIANCE
MONEY
RESERVES

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

[LOGO OF ALLIANCE CAPITAL APPEARS HERE]

PROSPECTUS
NOVEMBER 1, 1995

ALC36PRO5
- --------------------------------------------------------------------------------
<PAGE>

- --------------------------------------------------------------------------------
EXPENSE INFORMATION
- --------------------------------------------------------------------------------

SHAREHOLDER TRANSACTION EXPENSES
The Fund has no sales load on purchases or reinvested dividends, deferred
sales load, redemption fee or exchange fee.

<TABLE>
<CAPTION>
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets)
<S> <C>
Management Fees.............................................. .48%
12b-1 Fees................................................... .25
Other Expenses............................................... .27
----
Total Fund Operating Expenses................................ 1.00%
</TABLE>
<TABLE>
<CAPTION>
EXAMPLE 1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
You would pay the following expenses on a
$1,000 investment, assuming a 5% annual
return (cumulatively through the end of
each time period): $10 $32 $55 $122
</TABLE>

- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS . FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD (AUDITED)
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
FEBRUARY 16,
YEAR ENDED JUNE 30, 1989(A)
--------------------------------------------- THROUGH
1995 1994 1993 1992 1991 1990 JUNE 30, 1989
------ ------ ------ ------ ------ ----- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, begin-
ning of period......... $ 1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
------ ------ ------ ------ ------ ----- -----
INCOME FROM INVESTMENT
OPERATIONS
Net investment income.. .045 .025 .027 .044 .066 .079 .033
------ ------ ------ ------ ------ ----- -----
LESS: DISTRIBUTIONS
Dividends from net in-
vestment income....... (.045) (.025) (.027) (.044) (.066) (.079) (.033)
------ ------ ------ ------ ------ ----- -----
Net asset value, end of
period................ $ 1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
====== ====== ====== ====== ====== ===== =====
TOTAL RETURN
Total investment return
based on:
Net asset value(b)..... 4.50% 2.57% 2.71% 4.47% 6.87% 8.26% 9.18%(c)
RATIOS/SUPPLEMENTAL DATA
Net assets, end of pe-
riod (in millions)..... $2,510 $1,795 $1,626 $1,412 $1,262 $993 $563
Ratio to average net as-
sets of:
Expenses, net of waiv-
ers and reimburse-
ments................. 1.00% 1.00% 1.00% 1.00% .97% .89% .99%(c)
Expenses, before waiv-
ers and reimburse-
ments................. 1.04% 1.09% 1.04% 1.04% 1.03% .99% 1.09%(c)
Net investment
income(d)............. 4.53% 2.55% 2.67% 4.33% 6.56% 7.92% 9.16%(c)
</TABLE>
- --------------
(a) Commencement of operations.
(b) 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.
(c) Annualized.
(d) Net of waivers and reimbursements.
- -------------------------------------------------------------------------------

From time to time, the Fund advertises its "yield" and "effective yield."
Both yield figures are based on historical earnings and are not intended to
indicate future performance. To calculate the "yield," the amount of dividends
paid on a share during a specified seven-day period is assumed to be paid each
week over a 52-week period and is shown as a percentage of the investment. To
calculate "effective yield," which will be higher than the "yield" because of
compounding, the dividends paid are assumed to be reinvested. Dividends for
the seven days ended June 30, 1995 amounted to an annualized yield of 5.12%,
equivalent to an effective yield of 5.25%.

2
<PAGE>

ALLIANCE MONEY RESERVES . . . . . . .
----------------------

INCOME . SAFETY . LIQUIDITY

We seek safety for the Fund by investing in a broadly diversified
list of money market securities which are selected for their high
quality, liquidity and stability of principal. Liquidity of the in-
vestment portfolio is increased even more by our emphasis on short-
term issues. Specifically, at the time of investment, no security
purchased can have a maturity exceeding one year, which maturity
may extend to 397 days, and the average maturity of the portfolio
cannot exceed 90 days.

The short average maturity of the portfolio enhances our ability
to maintain the Fund's share price at $1.00--this, in turn, pro-
vides both stability of value and liquidity to you and your fellow
shareholders.

Our professional investment managers seek the maximum current in-
come for the Fund that is consistent with safety of principal and
liquidity. In addition to their knowledge and experience with money
markets, our managers obtain yield advantages for the Fund by mak-
ing many security purchases in especially large amounts such as $1
million and multiples thereof. Persons investing for themselves
usually cannot exploit such money market opportunities due to the
large investment sizes required.

WHO SHOULD INVEST IN THE FUND?

The Fund is designed for individuals, brokers, institutions, ad-
visers, custodians, charities, fiduciaries, or corporations who can
benefit from high money market income--and who place value on an
investment having safety, liquidity, stability, simplicity, and
convenience. Investors using the Fund avoid certain mechanical bur-
dens that they would incur by investing in money markets directly,
such as monitoring of maturity dates, safeguarding of receipts and
deliveries, and the maintenance of tax information and other rec-
ords.

MAJOR FEATURES AND SERVICES OF ALLIANCE MONEY RESERVES

No sales charges Same-day funds for withdrawals
No withdrawal fees or penalties Free check-writing ($100 minimum per check)
Low-expense distribution plan Free institutional record-keeping services
(.25 of 1% maximum annual rate) IRA, SEP, 403 (b) (7) and employer-
Daily compounding of dividends sponsored retirement plans
First-day income for investments Low investment minimums

3
<PAGE>

- --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE AND POLICIES
- --------------------------------------------------------------------------------

The Fund's investment objective is maximum current income to the extent con-
sistent with safety of principal and liquidity. As a matter of fundamental
policy, the Fund pursues its objective by maintaining a portfolio of high
quality U.S. dollar-denominated money market securities, all of which at the
time of investment have remaining maturities of one year or less, which matu-
rities may extend to 397 days. While the Fund may not change this policy or
the "other fundamental investment policies" described in a separate section
below without shareholder approval, it may, upon notice to shareholders, but
without such approval, change the following investment policies or create ad-
ditional classes of shares in order to establish portfolios which may have
different investment objectives. There can be no assurance, as is true with
all investment companies, that the Fund's objective will be achieved.

MONEY MARKET SECURITIES

The money market securities in which the Fund invests include: (1) market-
able obligations of, or guaranteed by, the United States Government, its agen-
cies or instrumentalities (collectively, the "U.S. Government"); (2) certifi-
cates of deposit and bankers' acceptances issued or guaranteed by, or time de-
posits maintained at, banks or savings and loan associations (including for-
eign branches of U.S banks or U.S. or foreign branches of foreign banks) hav-
ing total assets of more than $500 million; (3) commercial paper of high qual-
ity [i.e., rated A-1 or A-2 by Standard & Poor's Corporation ("Standard &
Poor's"), Prime-1 or Prime-2 by Moody's Investors Service, Inc. ("Moody's"),
Fitch-1 or Fitch-2 by Fitch Investors Service, Inc., or Duff 1 or Duff 2 by
Duff & Phelps Inc. or, if not rated, issued by U.S. or foreign companies hav-
ing outstanding debt securities rated AAA, AA or A by Standard & Poor's, or
Aaa, Aa or A by Moody's] and participation interests in loans extended by
banks to such companies; and (4) repurchase agreements that are collateralized
in full each day by liquid securities of the types listed above. Repurchase
agreements may be entered into only with those banks (including State Street
Bank and Trust Company, the Fund's Custodian) or broker-dealers ("vendors")
that are eligible under the procedures adopted by the Trustees for evaluating
and monitoring the creditworthiness of such vendors. A repurchase agreement
would create a loss to the Fund if, in the event of a vendor default, the pro-
ceeds from the sale of the collateral were less than the repurchase price.

To the extent the Fund purchases money market instruments issued by foreign
entities, consideration will be given to the domestic marketability of such
instruments, and possible interruptions of, or restrictions on, the flow of
international currency transactions.

The Fund may purchase restricted securities that are determined by the Ad-
viser to be liquid in accordance with procedures adopted by the Trustees of
the Fund. Restricted securities are securities subject to contractual or legal
restrictions on resale, such as those arising from an issuer's reliance upon
certain exemptions from registration under the Securities Act of 1933 (the
"Securities Act"). The Fund may purchase restricted securities eligible for
resale under Rule 144A under the Securities Act and commercial paper issued in
reliance upon the exemption from registration in Section 4(2) of the Securi-
ties Act and, in each case, determined by the Adviser to be liquid in accor-
dance with procedures adopted by the Trustees of the Fund.

The Fund may invest in asset-backed securities that meet its existing diver-
sification, quality and maturity criteria. Asset-backed securities are securi-
ties issued by special purpose entities whose primary assets consist of a pool
of loans or accounts receivable. The securities may be in the form of a bene-
ficial interest in a special purpose trust, limited partnership interest, or
commercial paper or other debt securities issued by a special purpose corpora-
tion. Although the securities may have some form of credit or liquidity en-
hancement, payments on the

4
<PAGE>

securities depend predominately upon collection of the loans and receivables
held by the issuer. It is the Fund's current intention to limit its investment
in such securities to not more than 5% of its net assets.

OTHER FUNDAMENTAL INVESTMENT POLICIES

To maintain portfolio diversification and reduce investment risk, the Fund
may not: (1) invest more than 25% of its assets in the securities of issuers
conducting their principal business activities in any one industry although
there is no such limitation with respect to U.S. Government securities or cer-
tificates of deposit, bankers' acceptances and interest bearing savings depos-
its; (2) invest more than 5% of its assets in the securities of any one issuer
(except the U.S. Government) although with respect to one-quarter of its total
assets it may invest without regard to such limitation; (3) invest more than 5%
of its assets in the securities of any issuer (except the U.S. Government) hav-
ing less than three years of continuous operation or purchase more than 10% of
any class of the outstanding securities of any issuer (except the U.S. Govern-
ment); (4) borrow money except from banks on a temporary basis or via entering
into reverse repurchase agreements in aggregate amounts not exceeding 15% of
its assets and to facilitate the orderly maturation and sale of portfolio secu-
rities during any periods of abnormally heavy redemption requests; or (5) mort-
gage, pledge or hypothecate its assets except to secure such borrowings.

- --------------------------------------------------------------------------------
PURCHASE AND REDEMPTION OF SHARES
- --------------------------------------------------------------------------------

OPENING ACCOUNTS

Instruct your Account Executive to open an account in the Fund in conjunction
with your brokerage account.

SUBSEQUENT INVESTMENTS

A. BY CHECK THROUGH YOUR BROKERAGE FIRM

Mail or deliver your check made payable to your brokerage firm to your Ac-
count Executive who will deposit it into your brokerage account. Please indi-
cate your account number on the check.

B. BY SWEEP

REDEMPTIONS

A. BY CHECKWRITING

B. BY SWEEP

If your brokerage firm offers an automatic sweep service, the sweep will au-
tomatically transfer

5
<PAGE>

from your Fund account sufficient cash to cover any debit balance that may oc-
cur in your cash account for any reason.

OPENING AN ACCOUNT DIRECTLY WITH THE FUND; SHAREHOLDER SERVICES

For more information on the purchase and redemption of Fund shares, as well
as shareholder services, see the Statement of Additional Information.

- --------------------------------------------------------------------------------
ADDITIONAL INFORMATION
- --------------------------------------------------------------------------------

During periods of drastic economic or market development, such as the market
break of October 1987, it is possible that shareholders would have difficulty
in reaching Alliance Fund Services, Inc. by telephone (although no such diffi-
culty was apparent at any time in connection with the 1987 market break). If a
shareholder were to experience such difficulty, the shareholder should issue
written instructions to Alliance Fund Services, Inc. at the address shown on
page 8 of this prospectus. The Fund reserves the right to suspend or terminate
its telephone redemption service at any time without notice. Neither the Fund
nor the Adviser, or Alliance Fund Services, Inc. will be responsible for the
authenticity of telephone requests for redemptions that the Fund reasonably
believes to be genuine. The Fund will employ reasonable procedures in order to
verify that telephone requests for redemptions are genuine, including among
others, recording such telephone instructions and causing written confirma-
tions of the resulting transactions to be sent to shareholders. If the Fund
did not employ such procedures, it could be liable for losses arising from un-
authorized or fraudulent telephone instructions. Selected dealers or agents
may charge a commission for handling telephone requests for redemptions.

6
<PAGE>

has cleared, up to fifteen days following the purchase date. If the redemption
request during such period is in the form of a Fund check, the check will be
marked "insufficient funds" and be returned unpaid to the presenting bank.

THE ADVISER. The Fund retains Alliance Capital Management L.P., 1345 Avenue of
the Americas, New York, NY 10105, under an Advisory Agreement to provide in-
vestment advice and, in general, to conduct the Fund's management and invest-
ment program, subject to the general supervision and control of the Trustees of
the Fund. For the fiscal year ended June 30, 1995, the Fund paid the Adviser a
fee equal to .49 of 1% of the average daily value of the Fund's net assets.

Under a Distribution Services Agreement (the "Agreement"), the Fund makes pay-
ments to the Adviser at a maximum annual rate of .25 of 1% of the Fund's aggre-
gate average daily net assets. For the fiscal year ended June 30, 1995, the
Fund paid the Adviser at an annual rate of .21 of 1% of the average daily value
of the Fund's net assets. Substantially all such monies (together with signifi-
cant amounts from the Adviser's own resources) are paid by the Adviser to bro-
ker-dealers and other financial intermediaries for their distribution assis-
tance and to banks and other depository institutions for administrative and ac-
counting services provided to the Fund, with any remaining amounts being used
to partially defray other expenses incurred by the Adviser in distributing Fund
shares. The Fund believes that the administrative services provided by deposi-
tory institutions are permissible activities under present banking laws and
regulations and will take appropriate actions (which should not adversely af-
fect the Fund or its shareholders) in the future to maintain such legal confor-
mity should any changes in, or interpretations of, such laws or regulations oc-
cur.

7
<PAGE>

CUSTODIAN, TRANSFER AGENT AND DISTRIBUTOR. State Street Bank and Trust Compa-
ny, P.O. Box 1912, Boston, MA 02105, is the Fund's Custodian. Alliance Fund
Services, Inc., P.O. Box 1520, Secaucus, NJ 07096-1520 and Alliance Fund Dis-
tributors, Inc., 1345 Avenue of the Americas, New York, NY 10105, are the
Fund's Transfer Agent and Distributor, respectively. The transfer agent charges
a fee for its services.

FUND ORGANIZATION. The Fund is a series of Alliance Capital Reserves (the
"Trust"). The Trust is a diversified, open-end investment company registered
under the Act. The Fund is one of two series of the Trust; shares of the other
series, also named Alliance Capital Reserves, are offered by a separate pro-
spectus. The Trust was reorganized as a Massachusetts business trust in October
1984, having previously been a Maryland Corporation since its formation in
April 1978. The Trust's activities are supervised by its Trustees. Normally,
each share of each series is entitled to one vote, and vote as a single series
on matters that affect both series in substantially the same manner. Massachu-
setts law does not require annual meetings of shareholders and it is antici-
pated that shareholder meetings will be held only when required by Federal law.
Shareholders have available certain procedures for the removal of Trustees.

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

TRUSTEES
Dave H. Williams, Chairman
John D. Carifa
Sam Y. Cross
Charles H. P. Duell
William H. Foulk, Jr.
Elizabeth J. McCormack
David K. Storrs
Shelby White
John Winthrop

OFFICERS
Ronald M. Whitehill, President
John R. Bonczek, Senior Vice President
Kathleen A. Corbet, Senior Vice President
Wayne D. Lyski, Senior Vice President
Robert I. Kurzweil, Senior Vice President
Patricia Netter, Senior Vice President
Ronald R. Valeggia, Senior Vice President
Drew Biegel, Vice President
John F. Chiodi, Jr., Vice President
Doris T. Ciliberti, Vice President
William J. Fagan, Vice President
Linda D. Neil, Vice President
Raymond J. Papera, Vice President
Pamela F. Richardson, Vice President
Mark D. Gersten, Treasurer & Chief Financial
Officer
Edmund P. Bergan, Jr., Secretary

<PAGE>

This is filed pursuant to Rule 497(c).
File Nos. 002-61564 and 811-02835.

<PAGE>

(LOGO)(R)
ALLIANCE CAPITAL RESERVES
________________________________________________________________
P.O. Box 1520, Secaucus, New Jersey 07096-1520
Toll Free (800) 221-5672
________________________________________________________________

STATEMENT OF ADDITIONAL INFORMATION
November 1, 1995
________________________________________________________________

TABLE OF CONTENTS
Page

The Fund........................................... 2

Investment Objectives and Policies................. 2

Investment Restrictions............................ 9

Management......................................... 11

Purchase and Redemption of Shares.................. 20

Additional Information............................. 23

Daily Dividends-Determination of Net Asset Value... 26

Taxes.............................................. 27

General Information................................ 28

Appendix-Commercial Paper and Bond Ratings......... 31

Financial Statements............................... 33

Independent Auditor's Report....................... 39

_________________________________________________________________
This Statement of Additional Information is not a prospectus but
supplements and should be read in conjunction with the Fund's
current Prospectus dated November 1, 1995. A copy of the
Prospectus may be obtained by contacting the Fund at the address
or telephone number shown above.

___________________
(R) This registered service mark used under license from the
owner, Alliance Capital Management L.P.

<PAGE>

_________________________________________________________________

THE FUND
_________________________________________________________________

Alliance Capital Reserves (the "Fund") is one of two
portfolios of Alliance Capital Reserves (the "Trust"), a
diversified, open-end investment company. The other portfolio,
Alliance Money Reserves, is described in a separate Prospectus
and Statement of Additional Information, which may be obtained
from Alliance Fund Services, Inc., P.O. Box 1520, Secaucus, New
Jersey 07096-1520, toll free (800) 221-5672.

_________________________________________________________________

INVESTMENT OBJECTIVES AND POLICIES
_________________________________________________________________

The Fund's objectives are - in the following order of
priority - safety of principal, excellent liquidity, and maximum
current income to the extent consistent with the first two
objectives. As a matter of fundamental policy, the Fund pursues
its objectives by maintaining a portfolio of high-quality money
market securities all of which, at the time of investment, have
remaining maturities not exceeding one year or less (which
maturities pursuant to Rule 2a-7 under the Investment Company Act
of 1940, as amended (the "Act"), may extend to 397 days).
Accordingly, the Fund may make the following investments
diversified by maturities and issuers:

1. Marketable obligations of, or guaranteed by, the United
States Government, its agencies or instrumentalities. These
include issues of the U.S. Treasury, such as bills, certificates
of indebtedness, notes and bonds, and issues of agencies and
instrumentalities established under the authority of an act of
Congress. The latter issues include, but are not limited to,
obligations of the Bank for Cooperatives, Federal Financing Bank,
Federal Home Loan Bank, Federal Intermediate Credit Banks,
Federal Land Banks, Federal National Mortgage Association and
Tennessee Valley Authority. Some of the securities are supported
by the full faith and credit of the U.S. Treasury, others are
supported by the right of the issuer to borrow from the Treasury,
and still others are supported only by the credit of the agency
or instrumentality.

2. Certificates of deposit, bankers' acceptances and
interest-bearing savings deposits issued or guaranteed by banks
or savings and loan associations having total assets of more than
$1 billion and which are members of the Federal Deposit Insurance
Corporation and certificates of deposit and bankers' acceptances
denominated in U.S. dollars and issued by U.S. branches of

<PAGE>

foreign banks having total assets of at least $1 billion that are
believed by the Adviser to be of quality equivalent to that of
other such instruments in which the Fund may invest.
Certificates of deposit are receipts issued by a depository
institution in exchange for the deposit of funds. The issuer
agrees to pay the amount deposited plus interest to the bearer of
the receipt on the date specified on the certificate. Such
certificates may include, for example, those issued by foreign
subsidiaries of such banks which are guaranteed by them. The
certificate usually can be traded in the secondary market prior
to maturity. Bankers' acceptances typically arise from short-
term credit arrangements designed to enable businesses to obtain
funds to finance commercial transactions. Generally, an
acceptance is a time draft drawn on a bank by an exporter or an
importer to obtain a stated amount of funds to pay for specific
merchandise. The draft is then "accepted" by a bank that, in
effect, unconditionally guarantees to pay the face value of the
instrument on its maturity date. The acceptance may then be held
by the accepting bank as an earning asset or it may be sold in
the secondary market at the going rate of discount for a specific
maturity. Although maturities for acceptances can be as long as
270 days, most acceptances have maturities of six months or less.

3. Commercial paper, including variable amount master
demand notes, of prime quality [i.e. rated A-1+ or A-1 by
Standard & Poor's Corporation ("Standard & Poor's") or Prime-1 by
Moody's Investors Service, Inc. ("Moody's") or, if not rated,
issued by domestic and foreign companies which have an
outstanding debt issue rated AAA or AA by Standard & Poor's, or
Aaa or Aa by Moody's]. For a description of such ratings see the
Appendix. Commercial paper consists of short-term (usually from
1 to 270 days) unsecured promissory notes issued by corporations
in order to finance their current operations. A variable amount
master demand note represents a direct borrowing arrangement
involving periodically fluctuating rates of interest under a
letter agreement between a commercial paper issuer and an
institutional lender pursuant to which the lender may determine
to invest varying amounts.

4. Repurchase agreements pertaining to the above
securities. A repurchase agreement arises when a buyer purchases
a security and simultaneously agrees to resell it to the vendor
at an agreed-upon future date. The resale price is greater than
the purchase price, reflecting an agreed-upon market rate which
is effective for the period of time the buyer's money is invested
in the security and which is not related to the coupon rate on
the purchased security. Repurchase agreements may be entered
into with member banks of the Federal Reserve System or "primary
dealers" (as designated by the Federal Reserve Bank of New York)
in U.S. Government securities or with State Street Bank and Trust
Company ("State Street Bank"), the Fund's Custodian. It is the

<PAGE>

Fund's current practice, which may be changed at any time without
shareholder approval, to enter into repurchase agreements only
with such primary dealers and State Street Bank. For each
repurchase agreement, the Fund requires continual maintenance of
the market value of underlying collateral in amounts equal to, or
in excess of, the agreement amount. While the maturities of the
underlying collateral may exceed one year, the term of the
repurchase agreement is always less than one year. In the event
that a vendor defaulted on its repurchase obligation, the Fund
might suffer a loss to the extent that the proceeds from the sale
of the collateral were less than the repurchase price. If the
vendor became bankrupt, the Fund might be delayed in selling the
collateral. Repurchase agreements often are for short periods
such as one day or a week, but may be longer. Repurchase
agreements not terminable within seven days will be limited to no
more than 10% of the Fund's assets.* Pursuant to Rule 2a-7, a
repurchase agreement is deemed to be an acquisition of the
underlying securities provided that the obligation of the seller
to repurchase the securities from the money market fund is
collateralized fully (as defined in such Rule). Accordingly, the
vendor of a fully collateralized repurchase agreement is deemed
to be the issuer of the underlying securities.

Reverse Repurchase Agreements. While the Fund has not
previously and has no future plans to do so, it may enter into
reverse repurchase agreements, which involve the sale of money
market securities held by the Fund with an agreement to
repurchase the securities at an agreed-upon price, date and
interest payment.

Asset-backed Securities. The Fund may invest in asset-
backed securities that meet its existing diversification, quality
and maturity criteria. Asset-backed securities are securities
issued by special purpose entities whose primary assets consist
of a pool of loans or accounts receivable. The securities may be
in the form of a beneficial interest in a special purpose trust,
limited partnership interest, or commercial paper or other debt
securities issued by a special purpose corporation. Although the
securities may have some form of credit or liquidity enhancement,
payments on the securities depend predominately upon collection
of the loans and receivables held by the issuer. It is the
___________________
* As used throughout the Prospectus and Statement of Additional
Information, term "assets" shall refer to the Fund's total
assets.

<PAGE>

Fund's current intention to limit its investment in such
securities to not more than 5% of its net assets.

Liquid Restricted Securities. The Fund may purchase
restricted securities that are determined by the Adviser to be
liquid in accordance with procedures adopted by the Trustees.
Restricted securities are securities subject to contractual or
legal restrictions on resale, such as those arising from an
issuer's reliance upon certain exemptions from registration under
the Securities Act of 1933 ( the "Securities Act").

In recent years, a large institutional market has developed
for certain types of restricted securities including, among
others, private placements, repurchase agreements, commercial
paper, foreign securities and corporate bonds and notes. These
instruments are often restricted securities because they are sold
in transactions not requiring registration. For example,
commercial paper issues in which the Fund may invest include,
among others, securities issued by major corporations without
registration under the Securities Act in reliance on the
exemption from registration afforded by Section 3(a)(3) of such
Act and commercial paper issued in reliance on the private
placement exemption from registration which is afforded by
Section 4(2) of the Securities Act ("Section 4(2) paper").
Section 4(2) paper is restricted as to disposition under the
Federal securities laws in that any resale must also be made in
an exempt transaction. Section 4(2) paper is normally resold to
other institutional investors through or with the assistance of
investment dealers who make a market in Section 4(2) paper, thus
providing liquidity. Institutional investors, rather than
selling these instruments to the general public, often depend on
an efficient institutional market in which such restricted
securities can be readily resold in transactions not involving a
public offering. In many instances, therefore, the existence of
contractual or legal restrictions on resale to the general public
does not, in practice, impair the liquidity of such investments
from the perspective of institutional holders. In recognition of
this fact, the Staff of the Securities and Exchange Commission
has stated that Section 4(2) paper my be determined to be liquid
by the Fund's Trustees, so long as certain conditions, which are
described below, are met.

<PAGE>

markets may provide both readily ascertainable values for
restricted securities and the ability to liquidate an investment
in order to satisfy share redemption orders on a timely basis. An
insufficient number of qualified institutional buyers interested
in purchasing certain restricted securities held by the Fund,
however, could affect adversely the marketability of such
portfolio securities and the Fund might be unable to dispose of
such securities promptly or at reasonable prices. Rule 144A has
already produced enhanced liquidity for many restricted
securities, and market liquidity for such securities may continue
to expand as a result of Rule 144A and the consequent inception
of the PORTAL System sponsored by the National Association of
Securities Dealers, Inc., an automated system for the trading,
clearance and settlement of unregistered securities.

The Fund's Trustees have the ultimate responsibility for
determining whether specific securities are liquid or illiquid.
The Trustees have delegated the function of making day-to-day
determinations of liquidity to the Adviser, pursuant to
guidelines approved by the Trustees. The Adviser takes into
account a number of factors in determining whether a restricted
security being considered for purchase is liquid, including at
least the following:

(i) the frequency of trades and quotations for the
security;

(ii) the number of dealers making quotations to
purchase or sell the security;

(iii) the number of other potential purchasers of the
security;

(iv) the number of dealers undertaking to make a
market in the security;

(v) the nature of the security (including its
unregistered nature) and the nature of the
marketplace for the security (e.g., the time
needed to dispose of the security, the method of
soliciting offers and the mechanics of
transfer); and

(vi) any applicable Securities and Exchange
Commission interpretation or position with
respect to such types of securities.

To make the determination that an issue of Section 4(2) paper
is liquid, the Adviser must conclude that the following
conditions have been met:

<PAGE>

(i) the Section 4(2) paper must not be traded flat
or in default as to principal or interest; and

(ii) the Section 4(2) paper must be rated in one of
the two highest rating categories by at least
two NRSROs, or if only one NRSRO rates the
security, by that NRSRO; if the security is
unrated, Alliance must determine that the
security is of equivalent quality.

The Adviser must also consider the trading market for the
specific security, taking into account all relevant factors.

Following the purchase of a restricted security by the Fund,
the Adviser monitors continuously the liquidity of such security
and reports to the Trustees regarding purchases of liquid
restricted securities.

While there are many kinds of short-term securities used by
money market investors, the Fund, in keeping with its primary
investment objective of safety of principal, restricts its
portfolio to the types of investments listed above. Of note, the
Fund does not invest in letters of credit. The Fund may make
investments in certificates of deposit issued by foreign branches
of domestic banks and certificates of deposit or bankers'
acceptances issued by U.S. branches of foreign banks specified
above, and commercial paper issued by foreign companies meeting
the rating criteria specified 3 above. To the extent that the
Fund invests in such instruments, consideration is given to their
domestic marketability, the lower reserve requirements generally
mandated for overseas banking operations, the possible impact of
interruptions in the flow of international currency transactions,
potential political and social instability or expropriation,
imposition of foreign taxes, less government supervision of
issuers, difficulty in enforcing contractual obligations and lack
of uniform accounting standards. As even the safest of
securities involve some risk, there can be no assurance, as is
true with all investment companies, that the Fund's objectives
will be achieved. The market value of the Fund's investments
tends to decrease during periods of rising interest rates and to
increase during intervals of falling rates.

<PAGE>

"fundamental policies" within the meaning of the Act and may,
therefore, be changed by the Trustees of the Trust without a
shareholder vote. However, the Fund will not change its
investment policies without contemporaneous written notice to
shareholders.

Rule 2a-7 under the Act. The Fund will comply with Rule 2a-
7 under the Act, as amended from time to time, including the
diversity, quality and maturity limitations imposed by the Rule.

Currently, pursuant to Rule 2a-7, the Fund may invest only in
"eligible securities," as that term is defined in the Rule.
Generally, an eligible security is a security that (i) is
denominated in U.S. Dollars and has a remaining maturity of 397
days or less; (ii) is rated, or is issued by an issuer with
short-term debt outstanding that is rated, in one of the two
highest rating categories by two nationally recognized
statistical rating organizations ("NRSROs") or, if only one NRSRO
has issued a rating, by that NRSRO; and (iii) has been determined
by the Adviser to present minimal credit risks pursuant to
procedures approved by the Trustees. A security that originally
had a maturity of greater than 397 days is an eligible security
if its remaining maturity at the time of purchase is 397 calendar
days or less and its remaining maturity at the time of purchase
is 397 calendar days or less and the issuer has outstanding
short-term debt that would be an eligible security. Unrated
securities may also be eligible securities if the Adviser
determines that they are of comparable quality to a rated
eligible security pursuant to guidelines approved by the
Trustees. A description of the ratings of some NRSROs appears in
the Appendix attached hereto.

Under Rule 2a-7 the Fund may not invest more than five
percent of its assets in the securities of any one issuer other
than the United States Government, its agencies and
instrumentalities. In addition, the Fund may not invest in a
security that has received, or is deemed comparable in quality to
a security that has received, the second highest rating by the
requisite number of NRSROs (a "second tier security") if
immediately after the acquisition thereof the Fund would have
invested more than (A) the greater of one percent of its total
assets or one million dollars in securities issued by that issuer
which are second tier securities, or (B) five percent of its
total assets in second tier securities.

<PAGE>

_________________________________________________________________

INVESTMENT RESTRICTIONS
_________________________________________________________________

The following restrictions may not be changed without the
affirmative vote of a majority of the Fund's outstanding shares,
which means the vote of (1) 67% or more of the shares represented
at a meeting at which more than 50% of the outstanding shares are
represented or (2) more than 50% of the outstanding shares,
whichever is less.

The Fund:

1. May not purchase any security which has a maturity date
more than one year* from the date of the Fund's purchase;

2. May not invest more than 25% of its assets in the
securities of issuers conducting their principal business
activities in any one industry provided that for purposes of this
restriction (a) there is no limitation with respect to
investments in securities issued or guaranteed by the United
States Government, its agencies or instrumentalities,
certificates of deposit, bankers' acceptances and interest-
bearing savings deposits and (b) neither all finance companies as
a group nor all utility companies as a group are considered a
single industry;

3. May not invest more than 5% of its assets in the
securities of any one issuer (exclusive of securities issued or
guaranteed by the United States Government, its agencies or
instrumentalities), except that up to 25% of the value of the
Fund's total assets may be invested without regard to such 5%
limitation;

4. May not invest in more than 10% of any one class of an
issuer's outstanding securities (exclusive of securities issued
or guaranteed by the United States Government, its agencies or
instrumentalities);

5. May not borrow money except from banks on a temporary
basis or via entering into reverse repurchase agreements in
aggregate amounts not to exceed 15% of the Fund's assets and to
be used exclusively to facilitate the orderly maturation and sale
of portfolio securities during any periods of abnormally heavy
redemption requests, if they should occur; such borrowings may
___________________
* Which maturity, pursuant to Rule 2a-7, may extend to 397 days.

<PAGE>

not be used to purchase investments and the Fund will not
purchase any investment while any such borrowings exist;

6. May not pledge, hypothecate or in any manner transfer,
as security for indebtedness, any securities owned or held by the
Fund except as may be necessary in connection with any borrowing
mentioned above, including reverse repurchase agreements, and in
an aggregate amount not to exceed 15% of the Fund's assets;

7. May not make loans, provided that the Fund may purchase
money market securities and enter into repurchase agreements;

8. May not enter into repurchase agreements if, as a result
thereof, more than 10% of the Fund's assets would be subject to
repurchase agreements not terminable within seven days (which may
be considered to be illiquid); or

9. May not (a) make investments for the purpose of
exercising control; (b) purchase securities of other investment
companies, except in connection with a merger, consolidation,
acquisition or reorganization; (c) invest in real estate (other
than money market securities secured by real estate or interests
therein or money market securities issued by companies which
invest in real estate, or interests therein), commodities or
commodity contracts, interests in oil, gas and other mineral
exploration or other development programs; (d) purchase
securities on margin; (e) make short sales of securities or
maintain a short position or write, purchase or sell puts, calls,
straddles, spreads or combinations thereof; (f) invest in
securities of issuers (other than agencies and instrumentalities
of the United States Government) having a record, together with
predecessors, of less than three years of continuous operation if
more than 5% of the Fund's assets would be invested in such
securities; (g) purchase or retain securities of any issuers if
those officers and trustees of the Fund and employees of the
Adviser who own individually more than 1/2 of 1% of the
outstanding securities of such issuer together own more than 5%
of the securities of such issuer; or (h) act as an underwriter of
securities.

In connection with the qualification or registration of the
Fund's shares for sale under the securities laws of certain
states, the Fund has agreed, in addition to the foregoing
investment restrictions, that it (i) will not invest more than 5%
of the value of its total assets at the time of purchase in the
commercial paper, including variable amount master demand notes,
of any one issuer, and (ii) will not pledge, hypothecate or in
any manner transfer, as security for indebtedness, securities
owned by the Fund if such pledge, hypothecation, or transfer
would then result in more than 10% of the Fund's net assets being
so encumbered.

<PAGE>

_________________________________________________________________

MANAGEMENT
_________________________________________________________________

Trustees and Officers

The Trustees and principal officers of the Trust and their
principal occupations during the past five years are set forth
below. Unless otherwise specified, the address of each such
person is 1345 Avenue of the Americas, New York, N.Y. 10105.
Those Trustees whose names are preceded by an asterisk are
"interested persons" of the Trust as determined under the Act.
Each Trustee and officer is also a director, trustee or officer
of other registered investment companies sponsored by Alliance
Capital Management L.P. (the "Adviser").

Trustees

*DAVE H. WILLIAMS, 63, Chairman, is Chairman of the Board of
Directors of Alliance Capital Management Corporation ("ACMC")**,
sole general partner of the Adviser with which he has been
associated since prior to 1990.

*JOHN D. CARIFA, 50, is the President, Chief Operating
Officer, and a Director of ACMC with which he has been associated
since prior to 1990.

SAM Y. CROSS, 68, was, since prior to December 1990,
Executive Vice President of The Federal Reserve Bank of New York
and manager for foreign operations for The Federal Reserve
System. He is also a director of Fuji Bank and Trust Co. His
address is 200 East 66th Street, New York, New York 10021.

CHARLES H. P. DUELL, 57, is President of Middleton Place
Foundation with which he has been associated since prior to 1990.
He is also a Director of GRC International, Inc., a Trustee
Emeritus of the National Trust for Historic Preservation and
serves on the Board of Architectural Review, City of Charleston.
His address is Middleton Place Foundation, Ashley River Road,
Charleston, South Carolina 29414.

___________________
* An "interested person" of the Fund as defined in the Act.

** For purposes of this Statement of Additional Information,
ACMC refers to Alliance Capital Management Corporation, the sole
general partner of the Adviser, and to the predecessor general
partner of the Adviser of the same name.

<PAGE>

WILLIAM H. FOULK, JR., 63, is an independent consultant. He
was formerly Senior Manager of Barrett Associates, Inc., a
registered investment adviser, with which he had been associated
since prior to 1990. His address is 2 Hekma Road, Greenwich, CT
06831.

ELIZABETH J. McCORMACK, 73, is an Associate of Rockefeller
Family and Associates (philanthropic organization) and has been
since prior to 1990. She is a Director of Philip Morris, Inc.,
Champion International Corporation and The American Savings Bank.
She is a Trustee of Hamilton College, and a Member of the Board
of Overseers Managers of Swarthmore College and the Memorial
Sloan-Kettering Cancer Center. Her address is 30 Rockefeller
Plaza, New York, New York 10112.

DAVID K. STORRS, 51, is President of The Common Fund
(investment management for educational institutions) and has been
since prior to 1990. His address is The Common Fund, 450 Post
Road East, Westport, Connecticut 06881.

SHELBY WHITE, 57, is an author and financial journalist. Her
address is One Sutton Place South, New York, New York 10022.

JOHN WINTHROP, 59, is President of John Winthrop & Co., Inc.
(investment management) and has been since prior to 1990. He is
a Director of NUI Corporation and American Farmland Trust and a
Trustee of Pioneer Funds. His address is One North Ager's Wharf,
Charleston, South Carolina, 29401.

Officers

RONALD M. WHITEHILL - President, 56, is a Senior Vice
President of ACMC and Division President and Chief Executive
Officer of Alliance Cash Management Services with which he has
been associated since 1993. Previously, he was Senior Vice
President and Managing Director of Reserve Fund since prior to
1990.

JOHN R. BONCZEK - Senior Vice President, 35, is a Vice
President of ACMC with which he has been associated since prior
to 1990.

KATHLEEN A. CORBET - Senior Vice President, 35, has been a
Senior Vice President of ACMC since July 1993. Previously, she
held various responsibilities as head of Equitable Capital
Management Corporation's Fixed Income Management Department,
Private Placement Secondary Trading and Fund Management since
prior to 1990.

ROBERT I. KURZWEIL - Senior Vice President, 44, has been a
Vice President of ACMC since May 1994. Previously, he was Vice

<PAGE>

President of Sales and Business Development for Automatic Data
Processing with which he had been associated since prior to 1990.

WAYNE D. LYSKI - Senior Vice President, 54, is an Executive
Vice President of ACMC with which he has been associated since
prior to 1990.

PATRICIA NETTER - Senior Vice President, 44, is a Vice
President of ACMC with which she has been associated since prior
to 1990.

RONALD R. VALEGGIA - Senior Vice President, 48, is a Senior
Vice President of ACMC with which he has been associated since
prior to 1990.

DREW BIEGEL - Vice President, 44, is a Vice President of ACMC
which he has been associated with since prior to 1990.

JOHN F. CHIODI, Jr. - Vice President, 29, is a Vice President
of ACMC with which he has been associated since prior to 1990.

DORIS T. CILIBERTI - Vice President, 31, is an Assistant Vice
President of ACMC with which she has been associated since prior
to 1990.

WILLIAM J. FAGAN - Vice President, 33, is an Assistant Vice
President of ACMC with which he has been associated since prior
to 1990.

LINDA D. NEIL - Vice President, 35, is an Assistant Vice
President of ACMC with which she has been associated since August
1993. Previously, she was an Associate Director of The Reserve
Fund since prior to 1990.

RAYMOND J. PAPERA - Vice President, 39, is a Vice President
of ACMC with which he has been associated since prior to 1990.

PAMELA F. RICHARDSON - Vice President, 42, is a Vice
President of ACMC with which she has been associated since prior
to 1990.

EDMUND P. BERGAN, Jr. - Secretary, 45, is a Senior Vice
President and General Counsel of Alliance Fund Distributors, Inc.
("AFD") with which he has been associated since prior to 1990.

MARK D. GERSTEN - Treasurer and Chief Financial Officer, 45,
is a Senior Vice President of Alliance Fund Services, Inc.
("AFS") and AFD with which he has been associated since prior to
1990.

<PAGE>

JOSEPH J. MANTINEO - Controller, 36, is a Vice President of
AFS with which he has been associated since prior to 1990.

As of October 2, 1995 there were 3,681,807,292 shares of the
Fund outstanding of which the Trust's Trustees and officers as a
group owned less than 1%.

The Fund does not pay any fees to, or reimburse expenses of,
its Trustees who are considered "interested persons" of the Fund.
The aggregate compensation paid by the Fund to each of the
Trustees during its fiscal year ended June 30, 1995, the
aggregate compensation paid to each of the Trustees during
calendar year 1994 by all of the registered investment companies
to which the Adviser provides investment advisory services
(collectively, the "Alliance Fund Complex") and the total number
of funds in the Alliance Fund Complex with respect to which each
of the Trustees serves as a director or trustee, are set forth
below. Neither the Fund nor any other fund in the Alliance Fund
Complex provides compensation in the form of pension or
retirement benefits to any of its directors or trustees.

Total Total Number of Funds
Compensation in the Alliance Fund Complex
Aggregate from the Alliance Including the Fund, as to
Name of Trustee Compensation Fund Complex, which the Trustee is a
of the Fund from the Fund Including the Fund Director or Trustee
_______________ _____________ __________________ _____________________________

Dave H. Williams $-0- $-0- 6
John D. Carifa $-0- $-0- 49
Sam Y. Cross $2,368 $15,000 3
Charles H.P. Duell $2,368 $14,250 3
William H. Foulk, Jr. $3,000 $141,500 30
Elizabeth J. McCormack $1,993 $15,000 3
David K. Storrs $1,993 $15,750 3
Shelby White $2,368 $15,750 3
John Winthrop $1,993 $13,500 3

The Adviser

<PAGE>

Equitable Companies Incorporated ("ECI"), a holding company
controlled by AXA, a French insurance holding company. As of
June 30, 1995, ACMC, Inc. and Equitable Capital Management
Corporation, each a wholly-owned direct or indirect subsidiary of
Equitable, together with Equitable, owned in the aggregate
approximately 59% of the issued and outstanding units
representing assignments of beneficial ownership of limited
partnership interests in the Adviser ("Units"), and approximately
33% and 8% of the Units were owned by the public and employees of
the Adviser and its subsidiaries, respectively, including
employees of the Adviser who serve as Directors of the Fund.

AXA owns approximately 60% of the outstanding voting shares
of common stock of ECI. AXA is a member of a group of companies
(the "AXA Group") that is the second largest insurance group in
France (measured by gross premiums written worldwide) and one of
the largest insurance groups in Europe. Principally engaged in
property and casualty insurance and life insurance in Europe and
elsewhere in the world, the AXA Group is also involved in real
estate operations and certain other financial services, including
mutual fund management, lease financing services and brokerage
services. Based on information provided by AXA, as of January 1,
1995, 42.3% of the issued shares (representing 54.7% of the
voting power) of AXA were owned by Midi Participations, a French
corporation that is a holding company. The voting shares of Midi
Participations are in turn owned 60% by Finaxa, a French
corporation that is a holding company, and 40% by subsidiaries of
Assicurazioni Generali S.p.A., an Italian corporation
("Generali") (one of which, Belgica Insurance Holding S.A., a
Belgian Corporation, owned 34.1%). As of January 1, 1995, 62.1%
of the issued shares (representing 75.7% of the voting power) of
Finaxa were owned by five French mutual insurance companies (the
"Mutuelles AXA") (one of which, AXA Assurances I.A.R.D. Mutuelle,
owned 31.8% of the issued shares) (representing 39.0% of the
voting power), and 26.5% of the issued shares (representing 16.6%
of the voting power) of Finaxa were owned by Banque Paribas, a
French bank ("Paribas"). Including the shares owned by Midi
Participations, as of January 1, 1995, the Mutuelles AXA directly
or indirectly owned 51.3% of the issued shares (representing
65.8% of the voting power) of AXA. In addition, certain
subsidiaries of AXA own 0.4% of the shares of AXA which are not
entitled to be voted. Acting as a group, the Mutuelles AXA
control AXA, Midi Participations and Finaxa.

<PAGE>

1995, 29 of the FORTUNE 100 companies. As of that date, the
Adviser and its subsidiaries employed approximately 1,350
employees who operated out of domestic offices and the overseas
offices of subsidiaries in Bombay, Istanbul, London, Sydney,
Tokyo, Toronto, Bahrain, Luxembourg and Singapore. The 51
registered investment companies comprising 105 separate
investment portfolios managed by the Adviser currently have more
than two million shareholders.

Under the Advisory Agreement, the Adviser provides investment
advisory services and order placement facilities for the Fund and
pays all compensation of Trustees of the Trust who are affiliated
persons of the Adviser. The Adviser or its affiliates also
furnish the Fund without charge with management supervision and
assistance and office facilities. Under the Advisory Agreement,
the Fund pays an advisory fee at an annual rate of .50 of 1% of
the first $1.25 billion of the average daily net value of the
Fund's net assets, .49 of 1% of the next $.25 billion of such
assets, .48 of 1% of the next $.25 billion of such assets, .47 of
1% of the next $.25 billion of such assets, .46 of 1% of the next
$1 billion of such assets and .45 of 1% of the average daily
value of the Fund's net assets in excess of $3 billion. The fee
is accrued daily and paid monthly. The Adviser will reimburse
the Fund to the extent that its net expenses (excluding taxes,
brokerage, interest and extraordinary expenses) exceed 1% of its
average daily net assets for any fiscal year. For the fiscal
years ended June 30, 1993, 1994 and 1995, the Adviser received
from the Fund advisory fees of $9,983,590, $10,429,368 and
$11,459,444, respectively. In accordance with the Distribution
Services Agreement described below, the Fund may pay a portion of
advertising and promotional expenses in connection with the sale
of shares of the Fund. The Fund also pays for printing of
prospectuses and other reports to shareholders and all expenses
and fees related to registration and filing with the Securities
and Exchange Commission and with state regulatory authorities.
The Fund pays all other expenses incurred in its operations,
including the Adviser's management fees; custody, transfer and
dividend disbursing expenses; legal and auditing costs; clerical,
administrative accounting, and other office costs; fees and
expenses of Trustees who are not affiliated with the Adviser;
costs of maintenance of the Trust's existence; and interest
charges, taxes, brokerage fees, and commissions. As to the
obtaining of clerical and accounting services not required to be
provided to the Fund by the Adviser under the Advisory Agreement,
the Fund may employ its own personnel. For such services, it
also may utilize personnel employed by the Adviser; if so done,
the services are provided to the Fund at cost and the payments
therefor must be specifically approved in advance by the
Trustees. The Fund paid to the Adviser a total of $123,195,
$136,000 and $149,500 in respect of such services for the fiscal
years ended June 30, 1993, 1994 and 1995, respectively.

<PAGE>

The Fund has made arrangements with certain broker-dealers
whose customers are Fund shareholders pursuant to which the
broker-dealers perform shareholder servicing functions, such as
opening new shareholder accounts, processing purchase and
redemption transactions, and responding to inquiries regarding
the Fund's current yield and the status of shareholder accounts.
The Fund pays for the electronic communications equipment
maintained at the broker-dealers' offices that permits access to
the Fund's computer files and, in addition, reimburses the
broker-dealers at cost for personnel expenses involved in
providing the services. All such reimbursements must be approved
in advance by the Trustees. For the fiscal years ended June 30,
1993, 1994 and 1995, the Fund reimbursed such broker-dealers a
total of $561,826, $610,537 and $556,217, respectively.

The Advisory Agreement became effective on July 22, 1992.
Continuance of the Advisory Agreement until June 30, 1996 was
approved by the vote, cast in person by all the Trustees of the
Trust who neither were interested persons of the Trust nor had
any direct or indirect financial interest in the Agreement or any
related agreement, at a meeting called for that purpose on June
12, 1995.

The Advisory Agreement remains in effect from year to year
provided that such continuance is specifically approved at least
annually by a vote of a majority of the outstanding shares of the
Fund or by the Fund's Trustees including in either case approval
by a majority of the Trustees who are not parties to the Advisory
Agreement or interested persons as defined in the Act. The
Advisory Agreement may be terminated without penalty on 60 days'
written notice at the option of either party or by a vote of the
outstanding voting securities of the Fund; it will automatically
terminate in the event of assignment. The Adviser is not liable
for any action or inaction with regard to its obligations under
the Advisory Agreement as long as it does not exhibit willful
misfeasance, bad faith, gross negligence, or reckless disregard
of its obligations.

Distribution Services Agreement

Rule 12b-1 adopted by the Securities and Exchange Commission
under the Act permits an investment company to directly or
indirectly pay expenses associated with the distribution of its
shares in accordance with a duly adopted and approved plan. The
Fund has entered into a Distribution Services Agreement (the
"Agreement") which includes a plan adopted pursuant to Rule 12b-1
(the "Plan") with Alliance Fund Distributors, Inc. (the
"Distributor") and the Adviser, which applies to both series of
the Trust. Pursuant to the Plan, the Fund pays to the Adviser a
Rule 12b-1 distribution services fee which may not exceed an
annual rate of .25 of 1% of the Trust's (equal to each of its

<PAGE>

series') aggregate average daily net assets. In addition, under
the Agreement the Adviser makes payments for distribution
assistance and for administrative and accounting services from
its own resources which may include the management fee paid by
the Fund.

Payments under the Agreement are used in their entirety for
(i) payments to broker-dealers and other financial
intermediaries, including the Fund's Distributor, for
distribution assistance and to banks and other depository
institutions for administrative and accounting services, and (ii)
otherwise promoting the sale of shares of the Fund such as by
paying for the preparation, printing and distribution of
prospectuses and other promotional materials sent to existing and
prospective shareholders and by directly or indirectly purchasing
radio, television, newspaper and other advertising. In approving
the Agreement the Trustees determined that there was a reasonable
likelihood that the Agreement would benefit the Trust and its
shareholders. During the fiscal year ended June 30, 1995, the
Fund made payments to the Adviser for expenditures under the
Agreement in amounts aggregating $6,280,954 which constituted
.25% at an annual rate of the Fund's average daily net assets
during the period, and the Adviser made payments from its own
resources as described above aggregating $6,032,712. Of the
$12,313,666 paid by the Adviser and the Fund under the Agreement,
$172,143 was paid for advertising, printing and mailing of
prospectuses to persons other than current shareholders; and
$12,141,523 was paid to broker-dealers and other financial
intermediaries for distribution assistance.

The administrative and accounting services provided by banks
and other depository institutions may include, but are not
limited to, establishing and maintaining shareholder accounts,
sub-accounting, processing of purchase and redemption orders,
sending confirmations of transactions, forwarding financial
reports and other communications to shareholders and responding
to shareholder inquiries regarding the Trust. The State of Texas
requires that shares of the Fund may be sold in that state only
by dealers or other financial institutions that are registered
there as broker-dealers. As interpreted by courts and
administrative agencies, certain laws and regulations limit the
ability of a bank or other depository institution to become an
underwriter or distributor of securities. However, in the
opinion of the Fund's management based on the advice of counsel,
these laws and regulations do not prohibit such depository
institutions from providing other services for investment
companies such as the administrative and accounting services
described above. The Trustees will consider appropriate
modifications to the Trust's operations, including discontinuance
of payments under the Agreement to banks and other depository
institutions, in the event of any future change in such laws or

<PAGE>

regulations which may affect the ability of such institutions to
provide the above-mentioned services.

The Treasurer of the Trust reports the amounts expended under
the Agreement and the purposes for which such expenditures were
made to the Trustees on a quarterly basis. Also, the Agreement
provides that the selection and nomination of disinterested
Trustees (as defined in the Act) are committed to the discretion
of the disinterested Trustees then in office.

The Agreement became effective on July 22, 1992. Continuance
of the Agreement until June 30, 1996 was approved by the vote,
cast in person by all the Trustees of the Trust who neither were
interested persons of the Trust nor had any direct or indirect
financial interest in the Agreement or any related agreement, at
a meeting called for that purpose on June 12, 1995. The
Agreement may be continued annually thereafter if approved by a
majority vote of the Trustees who neither are interested persons
of the Fund nor have any direct or indirect financial interest in
the Agreement or in any related agreement, cast in person at a
meeting called for that purpose.

All material amendments to the Agreement must be approved by
a vote of the Trustees, including a majority of the disinterested
Trustees, cast in person at a meeting called for that purpose,
and the Agreement may not be amended in order to increase
materially the costs which the Fund may bear pursuant to the
Agreement without the approval of a majority of the outstanding
shares of the Fund. The Agreement may also be terminated at any
time by a majority vote of the disinterested Trustees, or by a
majority of the outstanding shares of the Fund or by the
Distributor. Any agreement with a qualifying broker-dealer or
other financial intermediary may be terminated without penalty on
not more than sixty days' written notice by a vote of the
majority of non-party Trustees, by a vote of a majority of the
outstanding shares of the Fund, or by the Distributor and will
terminate automatically in the event of its assignment.

The Agreement is in compliance with rules of the National
Association of Securities Dealers, Inc. (the "NASD") which became
effective July 7, 1993 and which limit the annual asset-based
sales charges and service fees that a mutual fund may impose to
.75% and .25%, respectively, of average annual net assets.

<PAGE>

_________________________________________________________________

PURCHASE AND REDEMPTION OF SHARES
_________________________________________________________________

Generally, shares of the Fund are sold and redeemed on a
continuous basis without sales or redemption charges at their net
asset value which is expected to be constant at $1.00 per share,
although this price is not guaranteed.

Accounts Not Maintained Through Financial Intermediaries

Opening Accounts -- New Investments

A. When Funds are Sent by Wire (the wire method permits
immediate credit)

1) Telephone the Fund toll-free at (800) 824-1916. The
Fund will ask for the name of the account as you
wish it to be registered, address of the account,
and taxpayer identification number social
security number for an individual. The Fund will
then provide you with an account number.

2) Instruct your bank to wire Federal funds (minimum
$1,000) exactly as follows:

ABA 0110 0002 8
State Street Bank and Trust Company
Boston, MA 02101
Alliance Capital Reserves
DDA 9903-279-9

Your account name as registered
Your account number with the Fund

3) Mail a completed Application Form to:

Alliance Fund Services, Inc.
P.O. Box 1520
Secaucus, New Jersey 07096-1520

B. When Funds are Sent by Check

1) Fill out an Application Form.

2) Mail the completed Application Form along with your
check or negotiable bank draft (minimum $1,000),
payable to "Alliance Capital Reserves," to Alliance
Fund Services, Inc. as in A(3) above.

<PAGE>

Subsequent Investments

A. Investments by Wire (to obtain immediate credit)

Instruct your bank to wire Federal funds (minimum $100)
to State Street Bank and Trust Company ("State Street Bank") as
in A(2) above.

B. Investments by Check

Mail your check or negotiable bank draft (minimum $100),
payable to "Alliance Capital Reserves," to Alliance Fund
Services, Inc. as in A(3) above.

Include with the check or draft the "next investment"
stub from one of your previous monthly or interim account
statements. For added identification, place your Fund account
number on the check or draft.

Investments Made by Check

Money transmitted by a check drawn on a member of the
Federal Reserve System is converted to Federal funds in one
business day following receipt and, thus, is then invested in the
Fund. Checks drawn on banks which are not members of the Federal
Reserve System may take longer to be converted and invested. All
payments must be in United States dollars.

PROCEEDS FROM ANY SUBSEQUENT REDEMPTION BY YOU OF FUND
SHARES THAT WERE PURCHASED BY CHECK OR ELECTRONIC FUNDS TRANSFER
WILL NOT BE FORWARDED TO YOU UNTIL THE FUND IS REASONABLY ASSURED
THAT YOUR CHECK OR ELECTRONIC FUNDS TRANSFER HAS CLEARED, UP TO
FIFTEEN DAYS FOLLOWING THE PURCHASE DATE. If the redemption
request during such period is in the form of a Fund check, the
check will be marked "insufficient funds" and be returned unpaid
to the presenting bank.

Redemptions

A. By Telephone

You may withdraw any amount from your account on any
Fund business day (i.e., any weekday exclusive of days on which
the New York Stock Exchange or State Street Bank is closed)
between 9:00 a.m. and 5:00 p.m. (New York time) via orders given
to Alliance Fund Services, Inc. by telephone toll-free (800) 824-
1916. Such redemption orders must include your account name as
registered with the Fund and the account number.

If your telephone redemption order is received by
Alliance Fund Services, Inc. prior to 12:00 Noon (New York time),

<PAGE>

we will send the proceeds in Federal funds by wire to your
designated bank account that day. The minimum amount for a wire
is $1,000. If your telephone redemption order is received by
Alliance Fund Services, Inc. after 12:00 Noon and before 4:00
p.m., we will wire the proceeds the next business day. You also
may request that proceeds be sent by check to your designated
bank. Redemptions are made without any charge to you.

During periods of drastic economic or market
developments, such as the market break of October 1987, it is
possible that shareholders would have difficulty in reaching
Alliance Fund Services, Inc. by telephone (although no such
difficulty was apparent at any time in connection with the 1987
market break). If a shareholder were to experience such
difficulty, the shareholder should issue written instructions to
Alliance Fund Services, Inc. at the address shown on the cover of
this statement of additional information. The Fund reserves the
right to suspend or terminate its telephone redemption service at
any time without notice. Neither the Fund nor the Adviser, or
Alliance Fund Services, Inc. will be responsible for the
authenticity of telephone requests for redemptions that the Fund
reasonably believes to be genuine. The Fund will employ
reasonable procedures in order to verify that telephone requests
for redemptions are genuine, including among others, recording
such telephone instructions and causing written confirmations of
the resulting transactions to be sent to shareholders. If the
Fund did not employ such procedures, it could be liable for
losses arising from unauthorized or fraudulent telephone
instructions. Selected dealers or agents may charge a commission
for handling telephone requests for redemptions.

B. By Check-Writing

With this service, you may write checks made payable to
any payee in any amount of $100 or more. Checks cannot be
written for more than the principal balance (not including any
accrued dividends) in your account. First, you must fill out the
Signature Card which is with the Application Form. If you wish
to establish this check-writing service, except that State Street
Bank will impose its normal charges for checks which are returned
unpaid because of insufficient funds or for checks upon which you
have placed a stop order.

THE CHECK-WRITING SERVICE ENABLES YOU TO RECEIVE THE DAILY
DIVIDENDS DECLARED ON THE SHARES TO BE REDEEMED UNTIL THE DAY
THAT YOUR CHECK IS PRESENTED TO STATE STREET BANK FOR PAYMENT.

<PAGE>

C. By Mail

You may withdraw any amount from your account at any
time by mail. Written orders for withdrawal, accompanied by duly
endorsed certificates, if issued, should be mailed to Alliance
Fund Services, Inc., P.O. Box 1520, Secaucus, New Jersey 07096-
1520. Such orders must include the account name as registered
with the Fund and the account number. All written orders for
redemption, and accompanying certificates, if any, must be signed
by all owners of the account with the signatures guaranteed by an
institution which is an "eligible guarantor" as defined in Rule
17Ad-15 under the Securities Exchange Act of 1934, as amended.

________________________________________________________________

Additional Information
_________________________________________________________________

Shareholders maintaining Fund accounts through brokerage
firms and other institutions should be aware that such
institutions necessarily set deadlines for receipt of transaction
orders from their clients that are earlier than the transaction
times of the Fund itself so that the institutions may properly
process such orders prior to their transmittal to State Street
Bank. Should an investor place a transaction order with such an
institution after its deadline, the institution may not effect
the order with the Fund until the next business day.
Accordingly, an investor should familiarize himself or herself
with the deadlines set by his or her institution. (For example,
the Fund's Distributor accepts purchase orders from its customers
up to 2:15 p.m. for issuance at the 4:00 p.m. transaction time
and price.) A brokerage firm acting on behalf of a customer in
connection with transactions in Fund shares is subject to the
same legal obligations imposed on it generally in connection with
transactions in securities for a customer, including the
obligation to act promptly and accurately.

Orders for the purchase of Fund shares become effective at
the next transaction time after Federal funds or bank wire monies
become available to State Street Bank for a shareholder's
investment. Federal funds are a bank's deposits in a Federal
Reserve Bank. These funds can be transferred by Federal Reserve
wire from the account of one member bank to that of another
member bank on the same day and are considered to be immediately
available funds; similar immediate availability is accorded
monies received at State Street Bank by bank wire. Money
transmitted by a check drawn on a member of the Federal Reserve
System is converted to Federal funds in one business day
following receipt. Checks drawn on banks which are not members
of the Federal Reserve System may take longer. All payments

<PAGE>

(including checks from individual investors) must be in United
States dollars.

All shares purchased are confirmed to each shareholder and
are credited to his or her account at the net asset value. To
avoid unnecessary expense to the Fund and to facilitate the
immediate redemption of shares, share certificates, for which no
charge is made, are not issued except upon the written request of
a shareholder. Certificates are not issued for fractional
shares. Shares for which certificates have been issued are not
eligible for any of the optional methods of withdrawal; namely,
the telephone, telegraph, check-writing or periodic redemption
procedures. The Fund reserves the right to reject any purchase
order.

Arrangements for Telephone Redemptions. If you wish to use
the telephone redemption procedure, indicate this on your
Application Form and designate a bank and account number to
receive the proceeds of your withdrawals. If you decide later
that you wish to use this procedure, or to change instructions
already given, send a written notice to Alliance Money Reserves,
P.O. Box 1520, Secaucus, New Jersey 07096-1520, with your
signature guaranteed by an institution which is an eligible
guarantor. For joint accounts, all owners must sign and have
their signatures guaranteed.

Automatic Investment Program. A shareholder may purchase
shares of the Fund through an automatic investment program
through a bank that is a member of the National Automated
Clearing House Association. Purchases can be made on a Fund
business day each month designated by the shareholder.
Shareholders wishing to establish an automatic investment program
should write or telephone the Fund or Alliance Fund Service, Inc.
at (800) 221-5672.

Retirement Plans. The Fund's objectives of safety of
principal, excellent liquidity and maximum current income to the
extent consistent with the first two objectives may make it a
suitable investment vehicle for part or all of the assets held in
various tax-deferred retirement plans. The Fund has available
forms of individual retirement account (IRA), simplified employee
pension plans (SEP), 403(b)(7) plans and employer-sponsored
retirement plans (Keogh or HR10 Plan). Certain services
described in this prospectus may not be available to retirement
accounts and plans. Persons desiring information concerning
these plans should write or telephone the Fund or AFS at (800)
221-5672.

The Alliance Plans Division of Frontier Trust Company, a
subsidiary of The Equitable Life Assurance Society of the United
States, is the custodian under these plans. The custodian

<PAGE>

charges a nominal account establishment fee and a nominal annual
maintenance fee. A portion of such fees is remitted to AFS to
compensate that organization for services rendered to retirement
plan accounts maintained with the Fund.

Periodic Distribution Plans. Without affecting your right to
use any of the methods of redemption described above, by checking
the appropriate boxes on the Application Form, you may elect to
participate additionally in the following plans without any
separate charge. Under the Income Distribution Plan you receive
monthly payments of all the income earned in your Fund account,
with payments forwarded by check or electronically via the
Automated Clearing House ("ACH") network shortly after the close
of the month. Under the Systematic Withdrawal Plan, you may
request payments by check or electronically via the ACH network
in any specified amount of $50 or more each month or in any
intermittent pattern of months. If desired, you can order, via a
signature-guaranteed letter to the Fund, such periodic payments
to be sent to another person. Shareholders wishing either of the
above plans electronically through the ACH network should write
or telephone the Fund or AFS at (800) 221-5672.

The Fund has the right to close out an account if it has a
zero balance on December 31 and no account activity for the first
six months of the subsequent year. Therefore, unless this has
occurred, a shareholder with a zero balance, when reinvesting,
should continue to use his account number. Otherwise, the
account should be re-opened pursuant to procedures described
above or through instructions given to a financial intermediary.

A "business day," during which purchases and redemptions of
Fund shares can become effective and the transmittal of
redemption proceeds can occur, is considered for Fund purposes as
any weekday exclusive of national holidays on which the New York
Stock Exchange is closed and Good Friday; if one of these
holidays falls on a Saturday or Sunday purchases and redemptions
will likewise not be processed on the preceding Friday or the
following Monday, respectively. However, on any such day that is
an official bank holiday in Massachusetts, neither purchases nor
wire redemptions can become effective because Federal funds
cannot be received or sent by State Street Bank. On such days,
therefore, the Fund can only accept redemption orders for which
shareholders desire remittance by check. The right of redemption
may be suspended or the date of a redemption payment postponed
for any period during which the New York Stock Exchange is closed
(other than customary weekend and holiday closings), when trading
on the New York Stock Exchange is restricted, or an emergency (as
determined by the Securities and Exchange Commission) exists, or
the Securities and Exchange Commission has ordered such a
suspension for the protection of shareholders. The value of a
shareholder's investment at the time of redemption may be more or

<PAGE>

less than his or her cost, depending on the market value of the
securities held by the Fund at such time and the income earned.

_________________________________________________________________

DAILY DIVIDENDS-DETERMINATION OF NET ASSET VALUE
_________________________________________________________________

All net income of the Fund is determined after the close of
each business day, currently 4:00 p.m. New York time (and at such
other times as the Trustees may determine) and is paid
immediately thereafter pro rata to shareholders of record via
automatic investment in additional full and fractional shares in
each shareholder's account at the rate of one share for each
dollar distributed. As such additional shares are entitled to
dividends on following days, a compounding growth of income
occurs.

Net income consists of all accrued interest income on Fund
portfolio assets less the Fund's expenses applicable to that
dividend period. Realized gains and losses are reflected in net
asset value and are not included in net income. Net asset value
per share is expected to remain constant at $1.00 since all net
income is declared as a dividend each time net income is
determined.

The valuation of the Fund's portfolio securities is based
upon their amortized cost which does not take into account
unrealized securities gains or losses as measured by market
valuations. The amortized cost method involves valuing an
instrument at its cost and thereafter applying a constant
amortization to maturity of any discount or premium, regardless
of the impact of fluctuating interest rates on the market value
of the instrument. During periods of declining interest rates,
the daily yield on shares of the Fund may be higher than that of
a fund with identical investments utilizing a method of valuation
based upon market prices for its portfolio instruments; the
converse would apply in a period of rising interest rates.

<PAGE>

appropriate to determine whether and to what extent the net asset
value of the Fund calculated by using available market quotations
or market equivalents deviates from net asset value based on
amortized cost. If such deviation exceeds 1/2 of 1%, the
Trustees will promptly consider what action, if any, should be
initiated. In the event the Trustees determine that such a
deviation may result in material dilution or other unfair results
to new investors or existing shareholders, they will consider
corrective action which might include (1) selling instruments
prior to maturity to realize capital gains or losses or to
shorten average portfolio maturity; (2) withholding dividends of
net income on shares; or (3) establishing a net asset value per
share using available market quotations or equivalents. There
can be no assurance, however, that the Fund's net asset value per
share will remain constant at $1.00.

The net asset value of the shares is determined each business
day at 12:00 Noon and 4:00 p.m. (New York time). The net asset
value per share is calculated by taking the sum of the value of
the Fund's investments and any cash or other assets, subtracting
liabilities, and dividing by the total number of shares
outstanding. All expenses, including the fees payable to the
Adviser, are accrued daily.

_________________________________________________________________

TAXES
_________________________________________________________________

The Fund has qualified in each fiscal year to date and
intends to qualify in each future year to be taxed as a regulated
investment company under the Internal Revenue Code of 1986, as
amended (the "Code") and, as such, will not be liable for Federal
income and excise taxes on the net income and capital gains
distributed to its shareholders. Since the Fund distributes all
of its net income and capital gains, the Fund itself should
thereby avoid all Federal income and excise taxes.

For shareholders' Federal income tax purposes, all
distributions by the Fund out of interest income and net realized
short-term capital gains are treated as ordinary income, and
distributions of long-term capital gains, if any, are treated as
long-term capital gains irrespective of the length of time the
shareholder held shares in the Fund. Since the Fund derives
nearly all of its gross income in the form of interest and the
balance in the form of short-term capital gains, it is expected
that for corporate shareholders, none of the Fund's distributions
will be eligible for the dividends-received deduction under
current law.

<PAGE>

_________________________________________________________________

GENERAL INFORMATION
_________________________________________________________________

Portfolio Transactions. Subject to the general supervision
of the Trustees of the Fund, the Adviser is responsible for the
investment decisions and the placing of the orders for portfolio
transactions for the Fund. Because the Fund invests in
securities with short maturities, there is a relatively high
portfolio turnover rate. However, the turnover rate does not
have an adverse effect upon the net yield and net asset value of
the Fund's shares since the Fund's portfolio transactions occur
primarily with issuers, underwriters or major dealers in money
market instruments acting as principals. Such transactions are
normally on a net basis which does not involve payment of
brokerage commissions. The cost of securities purchased from an
underwriter usually includes a commission paid by the issuer to
the underwriters; transactions with dealers normally reflect the
spread between bid and asked prices.

The Fund has no obligations to enter into transactions in
portfolio securities with any dealer, issuer, underwriter or
other entity. In placing orders, it is the policy of the Fund to
obtain the best price and execution for its transactions. Where
best price and execution may be obtained from more than one
dealer, the Adviser may, in its discretion, purchase and sell
securities through dealers who provide research, statistical and
other information to the Adviser. Such services may be used by
the Adviser for all of its investment advisory accounts and,
accordingly, not all such services may be used by the Adviser in
connection with the Fund. The supplemental information received
from a dealer is in addition to the services required to be
performed by the Adviser under the Advisory Agreement, and the
expenses of the Adviser will not necessarily be reduced as a
result of the receipt of such information. During the fiscal
years ended June 30, 1993, 1994 and 1995, the Fund paid no
brokerage commissions.

<PAGE>

the election of Trustees and on any other matter affecting all
portfolios in substantially the same manner. As to matters
affecting each portfolio differently, such as approval of the
Advisory Agreement and changes in investment policy, shares of
each portfolio vote as separate classes. Certain procedures for
the removal by shareholders of trustees of investment trusts,
such as the Fund, are set forth in Section 16(c) of the Act.

Legal Matters. The legality of the shares offered hereby has
been passed upon by Seward & Kissel, One Battery Park Plaza, New
York, New York, counsel for the Fund and the Adviser. Seward &
Kissel has relied upon the opinion of Sullivan & Worcester,
Boston, Massachusetts, for matters relating to Massachusetts law.

Accountants. An opinion relating to the Fund's financial
statements is given herein by McGladrey & Pullen, LLP, New York,
New York, independent auditors for the Fund.

Yield Quotations. Advertisements containing yield quotations
for the Fund may from time to time be sent to investors or placed
in newspapers, magazines or other media on behalf of the Fund.
These advertisements may quote performance rankings, ratings or
data from independent organizations or financial publications
such as Lipper Analytical Services, Inc., Morningstar, Inc.,
IBC's Money Fund Report, IBC's Money Market Insight or Bank Rate
Monitor or compare the Fund's performance to bank money market
deposit accounts, certificates of deposit or various indices.
Such yield quotations are calculated in accordance with the
standardized method referred to in Rule 482 under the Securities
Act of 1933. Yield quotations are thus determined by (i)
computing the net changes over a seven-day period, exclusive of
capital changes, in the value of a hypothetical pre-existing
account having a balance of one share at the beginning of such
period, (ii) dividing the net change in account value by the
value of the account at the beginning of such period, and (iii)
multiplying such base period return by (365/7) with the resulting
yield figure carried to the nearest hundredth of one percent.
The Fund's effective annual yield represents a compounding of the
annualized yield according to the following formula:

effective yield = [(base period return + 1) 365/7] - 1.

The Fund's yield for the seven-day period ended June 30, 1995
was 5.12% which is the equivalent of a 5.25% compounded effective
yield. Current yield information can be obtained by a recorded
message by telephoning toll-free at (800) 221-9513.

Additional Information. This Statement of Additional
Information does not contain all the information set forth in the
Registration Statement filed by the Fund with the Securities and
Exchange Commission under the Securities Act of 1933. Copies of

<PAGE>

the Registration Statement may be obtained at a reasonable charge
from the Commission or may be examined, without charge, at the
Commission's offices in Washington, D.C.

<PAGE>

_________________________________________________________________

APPENDIX
_________________________________________________________________

A-1+, A-1, Prime-1, Fitch-1 and Duff 1 Commercial Paper Ratings

"A-1+" is the highest, and "A-1" the second highest,
commercial paper ratings assigned by Standard & Poor's and
"Prime-1" is the highest commercial paper rating assigned by
Moody's Investors Service, Inc. ("Moody's"). Standard & Poor's
uses the numbers 1+, 1, 2 and 3 to denote relative strength
within its highest classification of "A", while Moody's uses the
numbers 1, 2 and 3 to denote relative strength within its highest
classification of "Prime". Commercial paper issuers rated "A" by
Standard & Poor's have the following characteristics: liquidity
ratios are better than industry average; long-term debt rating is
A or better; the issuer has access to at least two additional
channels of borrowing; basic earnings and cash flow are in an
upward trend; and typically, the issuer is a strong company in a
well-established industry and has superior management.
Commercial paper issuers rated "Prime" by Moody's have the
following characteristics: their short-term debt obligations
carry the smallest degree of investment risk; margins of support
for current indebtedness are large or stable with cash flow and
asset protection well assured; current liquidity provides ample
coverage of near-term liabilities and unused alternative
financing arrangements are generally available; and while
protective elements may change over the intermediate or longer
term, such changes are most unlikely to impair the fundamentally
strong position of short-term obligations. Commercial paper
rated "Fitch-1" is considered to be the highest grade paper and
is regarded as having the strongest degree of assurance for
timely payment. Commercial paper issues rated "Duff 1" by Duff &
Phelps, Inc. have the following characteristics: very high
certainty of timely payment, excellent liquidity factors
supported by strong fundamental protection factors, and risk
factors which are very small.

AAA & AA and Aaa & Aa Bond Ratings

Bonds rated AAA and Aaa have the highest ratings assigned to
debt obligations by Standard & Poor's and Moody's, respectively.
Standard & Poor's AAA rating indicates an extremely strong
capacity to pay principal and interest. Bonds rated AA by
Standard & Poor's also qualify as high-quality debt obligations.
Capacity to pay principal and interest is very strong, and in the
majority of instances they differ from AAA issues only in small
degree. Moody's Aaa rating indicates the ultimate degree of
protection as to principal and interest. Moody's Aa rated bonds,
though also high-grade issues, are rated lower than Aaa bonds

<PAGE>

because margins of protection may not be as large or fluctuations
of protective elements may be of greater amplitude or there may
be other elements present which make the long-term risks appear
somewhat larger.

32
00250122.AC7

<PAGE>

STATEMENT OF NET ASSETS
JUNE 30, 1995 ALLIANCE CAPITAL RESERVES
- -------------------------------------------------------------------------------

PRINCIPAL
AMOUNT
(000) SECURITY+ YIELD VALUE
- ---------------------------------------------------------------------------
BANK OBLIGATIONS-13.1%
AMERICAN EXPRESS CENTURION BANK
$ 25,000 5.98%, 7/24/95 5.98% $25,000,000
BANK OF AMERICA ILLINOIS
25,000 5.90%, 8/15/95 5.93 24,999,072
BANK OF NEW YORK
10,000 6.25%, 8/02/95 6.40 9,998,574
BANK ONE CHICAGO N. A.
10,000 5.40%, 7/27/95 5.83 9,997,024
BANK ONE INDIANAPOLIS
20,000 5.98%, 8/01/95 5.98 20,000,000
BANK ONE MILWAUKEE
10,500 7.25%, 2/09/96 7.05 10,511,478
16,500 6.82%, 3/07/96 6.68 16,511,812
10,000 5.98%, 7/31/95 5.93 10,000,348
BOATMENS FIRST NATIONAL BANK OF KANSAS CITY
16,000 6.11%, 8/18/95 FRN 6.17 15,998,851
CHASE MANHATTAN CORP.
10,000 7.59%, 1/30/96 6.75 10,045,286
COMERICA BANK ILLINOIS
15,000 5.64%, 9/29/95 FRN 5.71 14,997,492
COMERICA BANK DETROIT MICHIGAN
10,000 5.62%, 11/08/95 FRN 5.74 9,995,643
19,000 5.62%, 11/22/95 FRN 5.78 18,988,748
FIFTH THIRD BANK
25,000 6.08%, 11/10/95 6.08 25,000,000
HUNTINGTON NATIONAL BANK
17,000 6.86%, 2/23/96 6.63 17,019,855
NATIONAL BANK OF DETROIT
20,000 6.32%, 10/12/95 6.32 20,000,000
NATIONSBANK DALLAS
10,000 7.00%, 2/06/96 7.20 9,987,953
NATIONSBANK NORTH CAROLINA
10,000 5.75%, 7/21/95 5.77 9,999,583
REPUBLIC NATIONAL BANK
35,000 4.75%, 10/15/95 6.13 34,847,958
STATE STREET BANK
32,000 5.83%, 9/05/95 5.90 31,995,134
WACHOVIA BANK
10,000 4.30%, 8/07/95 6.63 9,976,662
18,000 5.80%, 9/06/95 5.95 17,994,985
WORLD SAVINGS & LOAN ASSOC.
22,525 4.88%, 3/01/96 6.00 22,250,907
Total Bank Obligations
(amortized cost $396,117,365) 396,117,365

COMMERCIAL PAPER-65.4%
ABBEY NATIONAL
45,000 9/07/95 5.82% 44,505,300
AES BARBERS POINT, INC.
15,000 9/14/95 5.85 14,817,188
AGA CAPITAL CORP.
23,000 7/13/95 6.03 22,953,770
AKZO AMERICA INC.
20,000 8/18/95 5.93 19,841,867
ALLIANZ OF AMERICA FINANCE CORP.
18,500 10/10/95 5.70 18,204,154
25,734 7/07/95 6.04 25,708,095
AMERICAN BANKERS INSURANCE GROUP, INC.
16,000 8/09/95 5.95 15,896,867
BANCA CRT FINANCIAL CORP.
10,000 8/08/95 6.16 9,934,978
BAYER, INC.
30,000 7/31/95 5.94 29,851,500
40,000 7/25/95 5.95 39,841,333
BAYERISCHE VEREINSBANK
20,000 7/06/95 6.00 19,983,333
CAISSE DES DEPOTS ET CONSIGNATIONS
90,000 7/25/95 5.96 89,642,400
CARIPLO FINANCE, INC.
20,000 8/30/95 5.87 19,804,333
CHEMICAL BANKING CORP.
50,000 9/13/95 5.85 49,398,750
CHIAO TUNG BANK CO., LTD.
20,000 7/19/95 5.99 19,940,100
20,000 8/23/95 6.28 19,815,236
COMMERZBANK
29,500 7/03/95 6.25 29,489,757
CREGEM NORTH AMERICA, INC.
50,000 7/20/95 6.02 49,841,139
DEUTSCHE BANK FINANCIAL, INC.
75,000 7/07/95 5.88 74,926,500
20,000 7/07/95 5.95 19,980,167
DIC AMERICAS, INC.
18,000 7/10/95 5.95 17,973,225
DRESDNER US FINANCE, INC.
33,000 9/05/95 5.70 32,655,150
DUPONT (E. I.) DE NEMOURS & CO.
15,000 7/11/95 5.95 14,975,208
35,000 10/11/95 6.04 34,401,033
20,000 1/09/96 6.08 19,351,467

ALLIANCE CAPITAL RESERVES
- -------------------------------------------------------------------------------

PRINCIPAL
AMOUNT
(000) SECURITY+ YIELD VALUE
- ---------------------------------------------------------------------------
EKSPORTFINANS
$ 14,200 8/17/95 5.91% $14,090,435
55,500 7/20/95 5.93 55,326,301
13,000 8/09/95 5.93 12,916,486
EMBARCADERO CENTER PARTNERS
5,000 7/21/95 6.02 4,983,278
EXPORT DEVELOPMENT CORP.
55,000 7/12/95 5.95 54,900,007
FINANCE ONE FUNDING CORP.
20,000 8/11/95 5.90 19,865,611
20,000 8/08/95 5.94 19,874,600
15,000 8/15/95 5.95 14,888,438
FORD MOTOR CREDIT CORP.
25,000 9/05/95 5.88 24,730,500
25,000 7/12/95 6.09 24,953,479
FRANCISCAN SERVICES, INC.
10,000 7/17/95 5.95 9,973,556
GALICIA FUNDING
10,000 7/21/95 6.15 9,965,833
GENERAL ELECTRIC CREDIT CORP.
50,000 9/14/95 5.70 49,406,250
25,000 9/05/95 5.95 24,727,291
20,000 7/26/95 6.00 19,916,667
GOLDMAN SACHS GROUP LP
45,000 7/27/95 5.95 44,806,625
HEALTH INSURANCE PLAN OF GREATER NEW YORK
5,952 7/10/95 5.96 5,943,132
HYUNDAI MOTOR FINANCE CO.
10,000 10/02/95 5.88 9,848,100
KINGDOM OF SWEDEN
39,000 9/21/95 6.25 38,444,792
25,000 9/08/95 6.28 24,699,083
MERRILL LYNCH & CO.
30,000 8/02/95 6.00 29,840,000
MITSUBISHI INTERNATIONAL CORP.
25,000 7/06/95 5.95 24,979,340
MITSUBISHI MOTORS CREDIT OF AMERICA
20,000 7/25/95 6.02 19,919,733
MORGAN STANLEY GROUP, INC.
60,000 7/07/95 6.00 59,940,000
MPS US, INC.
25,000 7/27/95 6.01 24,891,486
NORDIC INVESTMENT BANK
30,000 7/07/95 5.92 29,970,400
10,000 7/03/95 5.97 9,996,683
ODC CAPITAL CORP.
13,000 7/07/95 5.91 12,987,195
22,000 7/20/95 5.91 21,931,378
PACIFIC DUNLOP, LTD.
28,000 7/05/95 5.95% 27,981,489
PONDER FINANCE CORP.
15,400 7/17/95 6.05 15,358,591
PROVINCE DE QUEBEC
35,000 12/11/95 6.19 34,019,057
25,000 9/07/95 6.24 24,705,333
SANTANDER FINANCE DELAWARE
60,000 11/08/95 5.92 58,717,333
SEVENTY FIVE STATE STREET CAPITAL CORP.
34,708 7/14/95 5.98 34,633,050
SKANDINAVISKA ENSKILDA BANKEN
25,000 9/11/95 6.24 24,688,000
SMITHKLINE BEECHAM
40,000 7/14/95 5.80 39,916,222
26,000 1/30/96 5.87 25,097,768
SVENSKA HANDELSBANKEN
35,000 9/01/95 5.90 34,644,361
SWEDISH EXPORT CREDIT CORP.
25,000 11/03/95 5.92 24,486,111
TELSTRA CORP.
30,000 7/14/95 5.95 29,935,542
UBS FINANCE DELAWARE, INC.
50,000 7/05/95 6.10 49,966,111
VATTENFALL TREASURY, INC.
40,000 9/29/95 5.80 39,420,000
5,000 7/14/95 6.00 4,989,167
25,000 8/04/95 6.11 24,855,736
WMC FINANCE, LTD.
12,500 7/12/95 6.05 12,476,892
Total Commercial Paper
(amortized cost $1,978,340,292) 1,978,340,292

CORPORATE OBLIGATIONS-5.3%
ABBEY NATIONAL TREASURY SERVICES
10,000 7.40%, 12/15/95 6.60 10,030,401
10,000 7.05%, 3/01/96 7.05 10,000,000
AID HOUSING GUARANTY PROJECT PORTUGAL
12,500 6.21%, 12/01/16 FRN 6.21 12,500,000
ATT CAPITAL CORP.
5,550 5.65%, 7/07/95 6.29 5,549,403
5,000 6.87%, 10/23/95 6.75 5,001,391
BEAR STEARNS COS., INC.
10,000 6.18%, 10/20/95 FRN 6.18 10,000,000
10,000 6.18%, 8/17/95 FRN 6.18 10,000,000
15,000 6.16%, 1/26/96 FRN 6.16 15,000,000

PORTFOLIO OF INVESTMENTS (CONTINUED) ALLIANCE CAPITAL RESERVES
- -------------------------------------------------------------------------------

PRINCIPAL
AMOUNT
(000) SECURITY+ YIELD VALUE
- ---------------------------------------------------------------------------
CS FIRST BOSTON, INC.
$ 15,000 6.11%, 4/01/96 FRN* 6.11% $15,000,000
GENERAL ELECTRIC CO.
17,000 7.88%, 5/01/96 6.50 17,186,285
GOLDMAN SACHS GROUP
20,000 5.53%, 11/02/95 FRN * 5.53 20,000,000
MERRILL LYNCH & CO.
14,000 6.95%, 2/27/96 FRN 7.00 14,000,000
10,000 5.62%, 3/25/96 FRN 5.62 10,000,000
TOYOTA MOTOR CREDIT CORP.
7,500 15.00%, 12/29/95 6.00 7,821,298
Total Corporate Obligations
(amortized cost $162,088,778) 162,088,778

U.S. GOVERNMENT AND AGENCY OBLIGATIONS-0.3%
FEDERAL HOME LOAN BANK DISC. NOTE
5,300 7/13/95 6.00 5,289,400
OVERSEAS PRIVATE INVESTMENT CORP.
2,500 6.21%, 6/10/97 FRN 6.21 2,500,000
Total U.S. Government and Agency
Obligations (amortized cost $7,789,400) 7,789,400

CERTIFICATES OF DEPOSIT-14.8%
ABN AMRO
20,000 6.25%, 8/02/95 6.11 20,002,149
BANQUE NATIONALE DE PARIS
40,000 5.83%, 8/04/95 5.92 39,996,560
25,000 6.05%, 7/03/95 6.03 25,000,025
BAYERISCHE HYPOBANK
25,000 6.10%, 7/19/95 6.08% 25,000,183
COMMERZBANK
25,000 6.17%, 9/25/95 6.06 25,005,809
DRESDNER BANK
10,000 6.46%, 4/26/96 6.44 10,001,565
FIFTH THIRD BANK
37,228 5.60%, 7/28/95 6.10 37,211,940
HESSISCHE LANDESBANK GIROZENTRALE
15,000 6.05%, 7/14/95 6.05 14,999,973
NORINCHUKIN BANK
40,000 6.02%, 7/17/95 6.01 40,000,177
SOCIETE GENERALE N.A., INC.
45,000 7.65%, 1/11/96 6.17 45,308,584
15,000 5.83%, 8/04/95 5.92 14,998,710
SUMITOMO BANK
50,000 6.02%, 7/17/95 6.01 50,000,221
SWISS BANK
100,000 6.01%, 7/21/95 6.00 100,000,385
Total Certificates of Deposit
(amortized cost $447,526,281) 447,526,281

TOTAL INVESTMENTS-98.9%
(amortized cost $2,991,862,116) 2,991,862,116
Other assets less liabilities-1.1% 32,229,975

NET ASSETS-100%
(offering and redemption price of $1.00
per share; 3,024,753,174 shares outstanding) $3,024,092,091

+ All securities either mature or their interest rate changes in one year or
less.

* Restricted security (see Note F).

Glossary of Terms:
FRN - Floating Rate Note
See notes to financial statements.

STATEMENT OF OPERATIONS
YEAR ENDED JUNE 30, 1995 ALLIANCE CAPITAL RESERVES
- -------------------------------------------------------------------------------

INVESTMENT INCOME
Interest $138,516,649

EXPENSES
Advisory fee (Note B) $12,206,955
Distribution assistance and administrative
service (Note C) 6,986,671
Transfer agency 5,376,617
Registration fees 468,871
Custodian fees 393,229
Printing 323,026
Audit and legal fees 56,805
Trustees' fees 17,333
Miscellaneous 41,819
Total expenses 25,871,326
Less: expense reimbursement (747,511)
25,123,815
Net investment income 113,392,834

REALIZED LOSS ON INVESTMENTS
Net realized loss on investments (525,149)

NET INCREASE IN NET ASSETS FROM OPERATIONS $112,867,685

STATEMENTS OF CHANGES IN NET ASSETS
- -------------------------------------------------------------------------------
YEAR ENDED YEAR ENDED
JUNE 30, 1995 JUNE 30, 1994
-------------- ---------------
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
Net investment income $113,392,834 $ 58,817,899
Net realized loss on investments (525,149) (49,939)
Net increase in net assets from operations 112,867,685 58,767,960

DIVIDENDS TO SHAREHOLDERS FROM:
Net investment income (113,392,834) (58,817,899)

TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST
Net increase 607,356,139 305,442,434
Total increase 606,830,990 305,392,495

NET ASSETS
Beginning of year 2,417,261,101 2,111,868,606
End of year $3,024,092,091 $2,417,261,101

See notes to financial statements.

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1995 ALLIANCE CAPITAL RESERVES
- -------------------------------------------------------------------------------

NOTE A: SIGNIFICANT ACCOUNTING POLICIES
Alliance Capital Reserves (the 'Trust') is an open-end diversified investment
company registered under the Investment Company Act of 1940. The Trust consists
of two portfolios: Alliance Capital Reserves (the 'Portfolio') and Alliance
Money Reserves. Each portfolio is considered to be a separate entity for
financial reporting and tax purposes. The following is a summary of significant
accounting policies followed by the Portfolio.

1. VALUATION OF SECURITIES
Securities in which the Portfolio invests are traded primarily in the
over-the-counter market and are valued at amortized cost, under which method a
portfolio instrument is valued at cost and any premium or discount is amortized
on a constant basis to maturity.

2. TAXES
It is the Portfolio's policy to comply with 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 applicable,
to its shareholders. Therefore, no provisions for federal income or excise
taxes are required.

3. DIVIDENDS
The Portfolio declares dividends daily and automatically reinvests such
dividends in additional shares at net asset value. Net realized capital gains
on investments, if any, are expected to be distributed near year end.

4. GENERAL
Interest income is accrued as earned. Security transactions are recorded on a
trade date basis. Realized gain (loss) from security transactions is recorded
on the identified cost basis. It is the Portfolio's policy to take possession
of securities as collateral under repurchase agreements and to determine on a
daily basis that the value of such securities are sufficient to cover the value
of the repurchase agreements.

NOTE B: ADVISORY FEE AND TRANSACTIONS WITH AN AFFILIATE OF THE ADVISER
The Portfolio pays its Adviser, Alliance Capital Management L.P., an advisory
fee at the annual rate of .50 of 1% on the first $1.25 billion of average daily
net assets; .49 of 1% on the next $.25 billion; .48 of 1% on the next $.25
billion; .47 of 1% on the next $.25 billion; .46 of 1% on the next $1 billion;
and .45 of 1% in excess of $3 billion. The Adviser has agreed to reimburse the
Portfolio to the extent that its annual aggregate expenses (excluding taxes,
brokerage, interest and, where permitted, extraordinary expenses) exceed 1% of
its average daily net assets for any fiscal year. For the year ended June 30,
1995, the reimbursement amounted to $747,511. The Portfolio compensates
Alliance Fund Services, Inc. (a wholly-owned subsidiary of the Adviser) for
providing personnel and facilities to perform transfer agency services for the
Portfolio. Such compensation amounted to $3,414,111 for the year ended June 30,
1995.

NOTE C: DISTRIBUTION ASSISTANCE AND ADMINISTRATIVE SERVICES PLAN
Under this Plan, the Portfolio pays the Adviser a distribution fee at an annual
rate of up to .25 of 1% of the average daily value of the Portfolio's net
assets.

The Plan provides that the Adviser will use amounts payable under the Plan in
their entirety for (i) payments to broker-dealers and other financial
intermediaries, including the Portfolio's distributor, for distribution
assistance and payments to banks and other depository institutions for
administrative and accounting services and (ii) otherwise promoting the sale of
shares of the Portfolio. For the year ended June 30, 1995, the distribution fee
amounted to $6,280,954. In addition, the Portfolio reimbursed certain
broker-dealers for administrative costs incurred in connection with providing
shareholder services, accounting, bookkeeping, legal and compliance support.
For the year ended June 30, 1995, such payments by the Portfolio amounted to
$705,717 of which $149,500 was paid to the Adviser.

ALLIANCE CAPITAL RESERVES
- -------------------------------------------------------------------------------

NOTE D: INVESTMENT TRANSACTIONS
At June 30, 1995, the cost of securities for federal income tax purposes was
the same as the cost for financial reporting purposes. At June 30, 1995 the
Portfolio had a capital loss carryforward of $661,083 of which $85,995 expires
in 2001, $49,939 expires in 2002 and $525,149 expires in 2003.

NOTE E: TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST
An unlimited number of shares ($.001 par value) are authorized. At June 30,
1995, capital paid-in aggregated $3,024,753,174. Transactions, all at $1.00 per
share, were as follows:

YEAR ENDED YEAR ENDED
JUNE 30, 1995 JUNE 30, 1994
---------------- ---------------
Shares sold 11,681,203,006 9,686,454,531
Shares issued on reinvestments of dividends 113,392,834 57,999,637
Shares redeemed (11,187,239,701) (9,439,011,734)
Net increase 607,356,139 305,442,434

NOTE F: RESTRICTED SECURITIES
The following securities are restricted as to resale except among qualified
institutional investors such as the Portfolio.

DATE % OF NET
SECURITY ACQUIRED VALUE ASSETS
- -------- -------- ----------- --------
CS First Boston, Inc., 6.11%, 4/01/96 FRN 3/30/95 $15,000,000 .50%
Goldman Sachs Group, 5.53%, 11/02/95 FRN 11/02/94 20,000,000 .66
----------- --------
$35,000,000 1.16%

NOTES TO FINANCIAL STATEMENTS (CONTINUED) ALLIANCE CAPITAL RESERVES
- -------------------------------------------------------------------------------

NOTE G: FINANCIAL HIGHLIGHTS
Selected data for a share outstanding throughout each period.

<TABLE>
<CAPTION>
YEAR ENDED JUNE 30,
------------------------------------------------
1995 1994 1993 1992 1991
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00

INCOME FROM INVESTMENT OPERATIONS
Net investment income .0447 .0255 .0266 .0438 .0662
Net realized gain on investments -0- -0- .0003 .0013 -0-
Net increase in net assets from operations .0447 .0255 .0269 .0451 .0662

LESS: DISTRIBUTIONS
Dividends from net investment income (.0447) (.0255) (.0266) (.0438) (.0662)
Distributions from net realized gains -0- -0- (.0003) (.0013) -0-
Total dividends and distributions (.0447) (.0255) (.0269) (.0451) (.0662)
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00

TOTAL RETURNS
Total investment return based on:
net asset value (a) 4.57% 2.58% 2.73% 4.61% 6.84%

RATIOS/SUPPLEMENTAL DATA
Net assets, end of year (in millions) $3,024 $2,417 $2,112 $1,947 $1,937
Ratio to average net assets of:
Expenses, net of waivers and reimbursements 1.00% 1.00% 1.00% 1.00% .97%
Expenses, before waivers and reimbursements 1.03% 1.03% 1.00% 1.00% .97%
Net investment income 4.51% 2.57% 2.65% 4.37% 6.62%
</TABLE>

(a) 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.

INDEPENDENT AUDITOR'S REPORT ALLIANCE CAPITAL RESERVES
- -------------------------------------------------------------------------------

TO THE BOARD OF TRUSTEES AND SHAREHOLDERS
ALLIANCE CAPITAL RESERVES PORTFOLIO

We have audited the accompanying statement of net assets of Alliance Capital
Reserves Portfolio as of June 30, 1995 and the related statements of
operations, changes in net assets, and financial highlights for the periods
indicated in the accompanying financial statements. These financial statements
and financial highlights are the responsibility of the Portfolio's 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. Our procedures included confirmation of securities owned as of June
30, 1995 by correspondence with the custodian.

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
Alliance Capital Reserves Portfolio as of June 30, 1995, and the results of its
operations, changes in its net assets, and its financial highlights for the
periods indicated, in conformity with generally accepted accounting principles.
New York, New York

August 8, 1995

<PAGE>

This is filed pursuant to Rule 497(c).
File Nos. 002-61564 and 811-02835.

<PAGE>

ALLIANCE CAPITAL RESERVES
- Alliance Money Reserves

P.O. Box 1520, Secaucus, New Jersey 07096-1520
Toll Free (800) 221-5672

STATEMENT OF ADDITIONAL INFORMATION
November 1, 1995

TABLE OF CONTENTS
Page

The Fund . . . . . . . . . . . . . . . . . . . . . 2

Investment Objective and Policies. . . . . . . . . 2

Investment Restrictions. . . . . . . . . . . . . . 8

Management . . . . . . . . . . . . . . . . . . . . 10

Purchase and Redemption of Shares. . . . . . . . . 19

Additional Information . . . . . . . . . . . . . . 23

Daily Dividends-Determination of Net Asset Value . 25

Taxes. . . . . . . . . . . . . . . . . . . . . . . 27

General Information. . . . . . . . . . . . . . . . 27

Appendix-Commercial Paper and Bond Ratings . . . . 30

Financial Statements . . . . . . . . . . . . . . . 32

Independent Auditor's Report . . . . . . . . . . . 39

This Statement of Additional Information is not a prospectus but
supplements and should be read in conjunction with the Fund's
current Prospectus dated November 1, 1995. A copy of the
Prospectus may be obtained by contacting the Fund at the address
or telephone number shown above.

____________________
(R) This registered service mark used under license from the
owner, Alliance Capital Management L.P.

<PAGE>

THE FUND

Alliance Money Reserves (the "Fund") is one of two portfolios
of Alliance Capital Reserves (the "Trust"), a diversified, open-
end investment company. The other portfolio, also named Alliance
Capital Reserves, is described in a separate Prospectus and
Statement of Additional Information, which may be obtained from
Alliance Fund Services, Inc., P.O. Box 1520, Secaucus, New Jersey
07096-1520, toll free (800) 221-5672.

INVESTMENT OBJECTIVE AND POLICIES

The Fund's objective is maximum current income, to the extent
it is consistent with safety of principal and liquidity. As a
matter of fundamental policy, the Fund pursues its objective by
maintaining a portfolio of high quality U.S. dollar-denominated
money market securities, all of which at the time of investment
have remaining maturities not exceeding one year or less (which
maturities pursuant to Rule 2a-7 under the Investment Company Act
of 1940 as amended, (the "Act"), may extend to 397 days).
Accordingly, the Fund may make the following investments
diversified by maturities and issuers:

2. Certificates of deposit and bankers' acceptances issued
or guaranteed by, or time deposits maintained at, banks or
savings and loan associations (including foreign branches of U.S.
banks or U.S. or foreign branches of foreign banks) having total
assets of more than $500 million. Certificates of deposit are
receipts issued by a depository institution in exchange for the

<PAGE>

deposit of funds. The issuer agrees to pay the amount deposited
plus interest to the bearer of the receipt on the date specified
on the certificate. The certificate usually can be traded in the
secondary market prior to maturity. Bankers' acceptances
typically arise from short-term credit arrangements designed to
enable businesses to obtain funds to finance commercial
transactions. Generally, an acceptance is a time draft drawn on
a bank by an exporter or an importer to obtain a stated amount of
funds to pay for specific merchandise. The draft is then
"accepted" by a bank that, in effect, unconditionally guarantees
to pay the face value of the instrument on its maturity date.
The acceptance may then be held by the accepting bank as an
earning asset or it may be sold in the secondary market at the
going rate of discount for a specific maturity. Although
maturities for acceptances can be as long as 270 days, most
acceptances have maturities of six months or less.

3. Commercial paper, including variable amount master
demand notes, of high quality [i.e. rated A-1 or A-2 by Standard
& Poor's Corporation ("Standard & Poor's"), Prime-1 or Prime-2 by
Moody's Investors Service, Inc., ("Moody's") Fitch-1 or Fitch-2
by Fitch Investors Service, Inc., or Duff 1 or Duff 2 by Duff &
Phelps Inc. or, if not rated, issued by U.S. or foreign companies
which have an outstanding debt issue rated AAA, AA or A by
Standard & Poor's, or Aaa, Aa or A by Moody's and participation
interests in loans extended by banks to such companies.] For a
description of such ratings see the Appendix. Commercial paper
consists of short-term (usually from 1 to 270 days) unsecured
promissory notes issued by corporations in order to finance their
current operations. A variable amount master demand note
represents a direct borrowing arrangement involving periodically
fluctuating rates of interest under a letter agreement between a
commercial paper issuer and an institutional lender pursuant to
which the lender may determine to invest varying amounts.

4. Repurchase agreements that are collateralized in full
each day by liquid securities of the types listed above. A
repurchase agreement arises when a buyer purchases a security and
simultaneously agrees to resell it to the vendor at an agreed-
upon future date. The resale price is greater than the purchase
price, reflecting an agreed-upon market rate which is effective
for the period of time the buyer's money is invested in the
security and which is not related to the coupon rate on the
purchased security. Repurchase agreements may be entered into
only with those banks (including State Street Bank and Trust
Company, the Fund's Custodian) or broker-dealers ("vendors") that
are eligible under the procedures adopted by the Trustees of the
Trust for evaluating and monitoring such vendors'
creditworthiness. For each repurchase agreement, the Fund
requires continual maintenance of the market value of underlying
collateral in amounts equal to, or in excess of, the agreement

<PAGE>

amount. While the maturities of the underlying collateral may
exceed one year, the term of the repurchase agreement is always
less than one year. In the event that a vendor defaulted on its
repurchase obligation, the Fund might suffer a loss to the extent
that the proceeds from the sale of the collateral were less than
the repurchase price. If the vendor became bankrupt, the Fund
might be delayed in selling the collateral. Repurchase
agreements often are for short periods such as one day or a week,
but may be longer. Repurchase agreements not terminable within
seven days will be limited to no more than 10% of the Fund's
assets.* Pursuant to Rule 2a-7, a repurchase agreement is deemed
to be an acquisition of the underlying securities provided that
the obligation of the seller to repurchase the securities from
the money market fund is collateralized fully (as defined in such
Rule). Accordingly, the vendor of a fully collateralized
repurchase agreement is deemed to be the issuer of the underlying
securities.

Reverse Repurchase Agreements. While the Fund has no plans to
do so, it may enter into reverse repurchase agreements, which
involve the sale of money market securities held by the Fund with
an agreement to repurchase the securities at an agreed-upon
price, date and interest payment.

Asset-backed Securities. The Fund may invest in asset-
backed securities that meet its existing diversification, quality
and maturity criteria. Asset-backed securities are securities
issued by special purpose entities whose primary assets consist
of a pool of loans or accounts receivable. The securities may be
in the form of a beneficial interest in a special purpose trust,
limited partnership interest, or commercial paper or other debt
securities issued by a special purpose corporation. Although the
securities may have some form of credit or liquidity enhancement,
payments on the securities depend predominately upon collection
of the loans and receivables held by the issuer. It is the
Fund's current intention to limit its investment in such
securities to not more than 5% of its net assets.

__________________
* As used throughout the Prospectus and Statement of Additional
Information, term "assets" shall refer to the Fund's total
assets.

<PAGE>

In 1990, in part to enhance the liquidity in the
institutional markets for restricted securities, the SEC adopted
Rule 144A under the Securities Act to establish a safe harbor
from the Securities Act's registration requirements for resale of
certain restricted securities to qualified institutional buyers.
Section 4(2) paper that is issued by a company that files reports
under the Securities Exchange Act of 1934 is generally eligible
to be resold in reliance on the safe harbor of Rule 144A.
Pursuant to Rule 144A, the institutional restricted securities
markets may provide both readily ascertainable values for
restricted securities and the ability to liquidate an investment
in order to satisfy share redemption orders on a timely basis. An
insufficient number of qualified institutional buyers interested
in purchasing certain restricted securities held by the Fund,
however, could affect adversely the marketability of such
portfolio securities and the Fund might be unable to dispose of
such securities promptly or at reasonable prices. Rule 144A has
already produced enhanced liquidity for many restricted
securities, and market liquidity for such securities may continue
to expand as a result of Rule 144A and the consequent inception

<PAGE>

of the PORTAL System sponsored by the National Association of
Securities Dealers, Inc., an automated system for the trading,
clearance and settlement of unregistered securities.

(i) the frequency of trades and quotations for the
security;

(ii) the number of dealers making quotations to purchase or
sell the security;

(iii) the number of other potential purchasers of the
security;

(iv) the number of dealers undertaking to make a market in
the security;

(v) the nature of the security (including its unregistered
nature) and the nature of the marketplace for the
security (e.g., the time needed to dispose of the
security, the method of soliciting offers and the
mechanics of transfer); and

(vi) any applicable Securities and Exchange Commission
interpretation or position with respect to such types
of securities.

To make the determination that an issue of Section 4(2) paper
is liquid, the Adviser must conclude that the following
conditions have been met:

(i) the Section 4(2) paper must not be traded flat or in
default as to principal or interest; and

(ii) the Section 4(2) paper must be rated in one of the two
highest rating categories by at least two NRSROs, or
if only one NRSRO rates the security, by that NRSRO;
if the security is unrated, Alliance must determine
that the security is of equivalent quality.

The Adviser must also consider the trading market for the
specific security, taking into account all relevant factors.

<PAGE>

The Fund may make investments in certificates of deposit and
bankers' acceptances issued or guaranteed by, or time deposits
maintained at, foreign branches of U.S. banks and U.S. and
foreign branches of foreign banks, and commercial paper issued by
foreign companies. To the extent that the Fund makes such
investments, consideration is given to their domestic
marketability, the lower reserve requirements generally mandated
for overseas banking operations, the possible impact of
interruptions in the flow of international currency transactions,
potential political and social instability or expropriation,
imposition of foreign taxes, the lower level of government
supervision of issuers, the difficulty in enforcing contractual
obligations and the lack of uniform accounting and financial
reporting standards. There can be no assurance, as is true with
all investment companies, that the Fund's objective will be
achieved. The market value of the Fund's investments tends to
decrease during periods of rising interest rates and to increase
during intervals of falling rates.

Net income to shareholders is aided both by the Fund's
ability to make investments in large denominations and by its
efficiencies of scale. Also, the Fund may seek to improve
portfolio income by selling certain portfolio securities prior to
maturity in order to take advantage of yield disparities that
occur in money markets. The Fund's investment objective may not
be changed without the affirmative vote of a majority of the
Fund's outstanding shares as defined below. Except as otherwise
provided, the Fund's investment policies are not designated
"fundamental policies" within the meaning of the Act and may,
therefore, be changed by the Trustees of the Trust without a
shareholder vote. However, the Fund will not change its
investment policies without contemporaneous written notice to
shareholders.

Rule 2a-7 under the Act. The Fund will comply with Rule 2a-
7 under the Act, as amended from time to time, including the
diversity, quality and maturity limitations imposed by the Rule.

<PAGE>

has issued a rating, by that NRSRO; and (iii) has been determined
by the Adviser to present minimal credit risks pursuant to
procedures approved by the Trustees. A security that originally
had a maturity of greater than 397 days is an eligible security
if its remaining maturity at the time of purchase is 397 calendar
days or less and its remaining maturity at the time of purchase
is 397 calendar days or less and the issuer has outstanding
short-term debt that would be an eligible security. Unrated
securities may also be eligible securities if the Adviser
determines that they are of comparable quality to a rated
eligible security pursuant to guidelines approved by the
Trustees. A description of the ratings of some NRSROs appears in
the Appendix attached hereto.

INVESTMENT RESTRICTIONS

The Fund:

1. May not purchase any security which has a maturity
date more than one year* from the date of the Fund's purchase;

_______________
* Which maturity, pursuant to Rule 2a-7, may extend to 397
days.

<PAGE>

5. May not borrow money except from banks on a temporary
basis or via entering into reverse repurchase agreements in
aggregate amounts not to exceed 15% of the Fund's assets and to
be used exclusively to facilitate the orderly maturation and sale
of portfolio securities during any periods of abnormally heavy
redemption requests, if they should occur; such borrowings may
not be used to purchase investments and the Fund will not
purchase any investment while any such borrowings exist;

7. May not make loans, provided that the Fund may
purchase money market securities and enter into repurchase
agreements;

8. May not enter into repurchase agreements if, as a
result thereof, more than 10% of the Fund's assets would be
subject to repurchase agreements not terminable within seven days
(which may be considered to be illiquid); or

<PAGE>

than money market securities secured by real estate or interests
therein or money market securities issued by companies which
invest in real estate, or interests therein), commodities or
commodity contracts, interests in oil, gas and other mineral
exploration or other development programs; (d) purchase
securities on margin; (e) make short sales of securities or
maintain a short position or write, purchase or sell puts, calls,
straddles, spreads or combinations thereof; (f) invest in
securities of issuers (other than agencies and instrumentalities
of the United States Government) having a record, together with
predecessors, of less than three years of continuous operation if
more than 5% of the Fund's assets would be invested in such
securities; (g) purchase or retain securities of any issuers if
those officers and trustees of the Fund and employees of the
Adviser who own individually more than 1/2 of 1% of the
outstanding securities of such issuer together own more than 5%
of the securities of such issuer; or (h) act as an underwriter of
securities.

MANAGEMENT

Trustees and Officers

The Trustees and principal officers of the Trust and their
principal occupations during the past five years are set forth
below. Unless otherwise specified, the address of each such
person is 1345 Avenue of the Americas, New York, New York 10105.
Those Trustees whose names are preceded by an asterisk are
"interested persons" of the Trust as determined under the Act.
Each Trustee and officer is also a director, trustee or officer
of other registered investment companies sponsored by Alliance
Capital Management L.P. (the "Adviser").

<PAGE>

Trustees

*JOHN D. CARIFA, 50, is the President, Chief Operating
Officer, and a Director of ACMC with which he has been associated
since prior to 1990.

__________________
* An "interested person" of the Fund as defined in the Act.

** For purposes of this Statement of Additional Information,
ACMC refers to Alliance Capital Management Corporation, the
sole general partner of the Adviser, and to the predecessor
general partner of the Adviser of the same name.

<PAGE>

SHELBY WHITE, 57, is an author and financial journalist. Her
address is One Sutton Place South, New York, New York 10022.

Officers

JOHN R. BONCZEK - Senior Vice President, 35, is a Vice
President of ACMC with which he has been associated since prior
to 1990.

ROBERT I. KURZWEIL - Senior Vice President, 44, has been a
Vice President of ACMC since May 1994. Previously, he was Vice
President of Sales and Business Development for Automatic Data
Processing with which he had been associated since prior to 1990.

WAYNE D. LYSKI - Senior Vice President, 54, is an Executive
Vice President of ACMC with which he has been associated since
prior to 1990.

<PAGE>

PATRICIA NETTER - Senior Vice President, 44, is a Vice
President of ACMC with which she has been associated since prior
to 1990.

RONALD R. VALEGGIA - Senior Vice President, 48, is a Senior
Vice President of ACMC with which he has been associated since
prior to 1990.

DREW BIEGEL - Vice President, 44, is a Vice President of
ACMC which he has been associated with since prior to 1990.

JOHN F. CHIODI, Jr. - Vice President, 29, is a Vice
President of ACMC with which he has been associated since prior
to 1990.

DORIS T. CILIBERTI - Vice President, 31, is an Assistant
Vice President of ACMC with which she has been associated since
prior to 1990.

WILLIAM J. FAGAN - Vice President, 33, is an Assistant Vice
President of ACMC with which he has been associated since prior
to 1990.

RAYMOND J. PAPERA - Vice President, 39, is a Vice President
of ACMC with which he has been associated since prior to 1990.

PAMELA F. RICHARDSON - Vice President, 42, is a Vice
President of ACMC with which she has been associated since prior
to 1990.

EDMUND P. BERGAN, Jr. - Secretary, 45, is a Senior Vice
President and General Counsel of Alliance Fund Distributors, Inc.
("AFD") with which he has been associated since prior to 1990.

MARK D. GERSTEN - Treasurer and Chief Financial Officer, 45,
is a Senior Vice President of Alliance Fund Services, Inc.
("AFS") and AFD with which he has been associated since prior to
1990.

JOSEPH J. MANTINEO - Controller, 36, is a Vice President of
AFS with which he has been associated since prior to 1990.

As of October 2, 1995 there were 2,776,912,834 shares of the
Fund outstanding of which the Trust's Trustees and officers as a
group owned less than 1%.

<PAGE>

Total Number
of Funds
in the Alliance
Total Fund Complex
Compensation Including the Fund,
Aggregate from the Alliance as to which the
Name of Trustee Compensation Fund Complex, Trustee is a
of the Fund from the Fund Including the Fund Director or Trustee
___________________ _____________ __________________ ___________________

Dave H. Williams $-0- $-0- 6
John D. Carifa $-0- $-0- 49
Sam Y. Cross $2,192 $15,000 3
Charles H.P. Duell $2,192 $14,250 3
William H. Foulk, Jr. $3,000 $141,500 30
Elizabeth J. McCormack $1,817 $15,000 3
David K. Storrs $1,817 $15,750 3
Shelby White $2,192 $15,750 3
John Winthrop $1,817 $13,500 3

The Adviser

Alliance Capital Management L.P., a New York Stock Exchange
listed company with principal offices at 1345 Avenue of the
Americas, New York, New York 10105, has been retained under an
investment advisory agreement (the "Advisory Agreement") as the
Fund's Adviser (see "Management of the Fund" in the Prospectus).
ACMC, the sole general partner of, and the owner of a 1% general
partnership interest in, the Adviser, is an indirect wholly-owned
subsidiary of The Equitable Life Assurance Society of the United
States ("Equitable"), one of the largest life insurance companies
in the United States and a wholly-owned subsidiary of The
Equitable Companies Incorporated ("ECI"), a holding company
controlled by AXA, a French insurance holding company. As of
June 30, 1995, ACMC, Inc. and Equitable Capital Management
Corporation, each a wholly-owned direct or indirect subsidiary of
Equitable, together with Equitable, owned in the aggregate

<PAGE>

approximately 59% of the issued and outstanding units
representing assignments of beneficial ownership of limited
partnership interests in the Adviser ("Units"), and approximately
33% and 8% of the Units were owned by the public and employees of
the Adviser and its subsidiaries, respectively, including
employees of the Adviser who serve as Directors of the Fund.

The Adviser is a leading international investment manager
supervising client accounts with assets as of September 30, 1995
totaling over $140 billion (of which approximately $47 billion
represented the assets of investment companies). The Adviser's
clients are primarily major corporate employee benefit funds,
public employee retirement systems, investment companies,
foundations and endowment funds and included, as of September 30,
1995, 29 of the FORTUNE 100 companies. As of that date, the
Adviser and its subsidiaries employed approximately 1,350
employees who operated out of domestic offices and the overseas
offices of subsidiaries in Bombay, Istanbul, London, Sydney,
Tokyo, Toronto, Bahrain, Luxembourg and Singapore. The 51

<PAGE>

registered investment companies comprising 105 separate
investment portfolios managed by the Adviser have currently more
than two million shareholders.

Under the Advisory Agreement, the Adviser provides investment
advisory services and order placement facilities for the Fund and
pays all compensation of Trustees of the Trust who are affiliated
persons of the Adviser. The Adviser or its affiliates also
furnish the Fund without charge with management supervision and
assistance and office facilities. Under the Advisory Agreement,
the Fund pays an advisory fee at an annual rate of .50 of 1% of
the first $1.25 billion of the average daily net value of the
Fund's net assets, .49 of 1% of the next $.25 billion of such
assets, .48 of 1% of the next $.25 billion of such assets, .47 of
1% of the next $.25 billion of such assets, .46 of 1% of the next
$1 billion of such assets and .45 of 1% of the average daily
value of the Fund's net assets in excess of $3 billion. The fee
is accrued daily and paid monthly. The Adviser will reimburse
the Fund to the extent that its net expenses (excluding taxes,
brokerage, interest and extraordinary expenses) exceed 1% of its
average daily net assets for any fiscal year. For the fiscal
years ended June 30, 1993, 1994 and 1995, the Adviser received
from the Fund advisory fees of $7,659,881, $8,011,324 and
$9,690,146, respectively. In accordance with the Distribution
Services Agreement described below, the Fund may pay a portion of
advertising and promotional expenses in connection with the sale
of shares of the Fund. The Fund also pays for printing of
prospectuses and other reports to shareholders and all expenses
and fees related to registration and filing with the Securities
and Exchange Commission and with state regulatory authorities.
The Fund pays all other expenses incurred in its operations,
including the Adviser's management fees; custody, transfer and
dividend disbursing expenses; legal and auditing costs; clerical,
administrative accounting, and other office costs; fees and
expenses of Trustees who are not affiliated with the Adviser;
costs of maintenance of the Trust's existence; and interest
charges, taxes, brokerage fees, and commissions. As to the
obtaining of clerical and accounting services not required to be
provided to the Fund by the Adviser under the Advisory Agreement,
the Fund may employ its own personnel. For such services, it
also may utilize personnel employed by the Adviser; if so done,
the services are provided to the Fund at cost and the payments
therefor must be specifically approved in advance by the
Trustees. In respect of such services for the fiscal years ended
June 30, 1993, 1994 and 1995, the Fund paid to the Adviser a
total of $111,302, $125,000 and $140,000, respectively.

<PAGE>

redemption transactions, and responding to inquiries regarding
the Fund's current yield and the status of shareholder accounts.
The Fund pays for the electronic communications equipment
maintained at the broker-dealers' offices that permits access to
the Fund's computer files and, in addition, reimburses the
broker-dealers at cost for personnel expenses involved in
providing the services. All such reimbursements must be approved
in advance by the Trustees. For the fiscal years ended June 30,
1993, 1994 and 1995, the Fund reimbursed such broker-dealers a
total of $1,194,450, $1,446,667 and $1,850,063, respectively.

The Advisory Agreement remains in effect from year to year
provided that such continuance is specifically approved annually
by a vote of a majority of the outstanding shares of the Fund or
by the Fund's Trustees, including in either case approved by a
majority of the Trustees who are not parties to the Advisory
Agreement or interested persons as defined by the Act. The
Advisory Agreement may be terminated without penalty on 60 days'
written notice at the option of either party or by a vote of the
outstanding voting securities of the Fund; it will automatically
terminate in the event of assignment. The Adviser is not liable
for any action or inaction with regard to its obligations under
the Advisory Agreement as long as it does not exhibit willful
misfeasance, bad faith, gross negligence, or reckless disregard
of its obligations.

Distribution Services Agreement

Rule 12b-1 adopted by the Securities and Exchange Commission
under the Act permits an investment company to directly or
indirectly pay expenses associated with the distribution of its
shares in accordance with a duly adopted and approved plan. The
Fund has entered into a Distribution Services Agreement (the
"Agreement") which includes a plan adopted pursuant to rule 12b-1
(the "Plan") with Alliance Fund Distributors, Inc. (the
"Distributor") and the Adviser, which applies to both series of
the Trust. Pursuant to the Plan, the Fund pays to the Adviser a
Rule 12b-1 distribution services fee, which may not exceed an
annual rate of .25 of 1% of the Trust's (equal to each of its
series') aggregate average daily net assets. In addition, under
the Agreement, the Adviser makes payments for distribution
assistance and for administrative and accounting services from

<PAGE>

its own resources which may include the management fee paid by
the Fund.

Payments under the Agreement are used in their entirety for
(i) payments to broker-dealers and other financial
intermediaries, including the Trust's Distributor, for
distribution assistance and to banks and other depository
institutions for administrative and accounting services, and (ii)
otherwise promoting the sale of shares of the Fund such as by
paying for the preparation, printing and distribution of
prospectuses and other promotional materials sent to existing and
prospective shareholders and by directly or indirectly purchasing
radio, television, newspaper and other advertising. In approving
the Agreement, the Trustees determined that there was a
reasonable likelihood that the Agreement would benefit the Fund
and its shareholders. During the fiscal year ended June 30,
1995, the Fund made payments to the Adviser for expenditures
under the Agreement in amounts aggregating $4,167,754 which
constituted .21 of 1% at an annual rate of the Fund's average
daily net assets and the Adviser made payments from its own
resources as described above aggregating $6,746,432. Of the
$10,914,186 paid by the Adviser and the Fund under the Agreement,
$115,156 was paid for advertising, printing and mailing of
prospectuses to persons other than current shareholders; and
$10,799,030 was paid to broker-dealers and other financial
intermediaries for distribution assistance.

The administrative and accounting services provided by banks
and other depository institutions may include, but are not
limited to, establishing and maintaining shareholder accounts,
sub-accounting, processing of purchase and redemption orders,
sending confirmations of transactions, forwarding financial
reports and other communications to shareholders and responding
to shareholder inquiries regarding the Trust. The State of Texas
requires that shares of the Fund may be sold in that state only
by dealers or other financial institutions that are registered
there as broker-dealers. As interpreted by courts and
administrative agencies, certain laws and regulations limit the
ability of a bank or other depository institution to become an
underwriter or distributor of securities. However, in the
opinion of the Trust's management based on the advice of counsel,
these laws and regulations do not prohibit such depository
institutions from providing other services for investment
companies such as the administrative and accounting services
described above. The Trustees will consider appropriate
modifications to the Trust's operations, including discontinuance
of payments under the Agreement to banks and other depository
institutions, in the event of any future change in such laws or
regulations which may affect the ability of such institutions to
provide the above-mentioned services.

<PAGE>

The Agreement became effective on July 22, 1992. Continuance
of the Agreement until June 30, 1996 was approved by the vote,
cast in person by all the Trustees of the Trust who neither were
interested persons of the Trust nor had any direct or indirect
financial interest in the Agreement or any related agreement, at
a meeting called for that purpose on June 12, 1995. The
Agreement may be continued annually thereafter if approved by a
majority vote of the Trustees who neither are interested of the
Trust nor have any direct or indirect financial interest in the
Agreement or in any related agreement, cast in person at a
meeting called for that purpose.

All material amendments to the Agreement must be approved by
a vote of the Trustees, including a majority of the disinterested
Trustees, cast in person at a meeting called for that purpose,and
the Agreement may not be amended in order to increase materially
the costs which the Fund may bear pursuant to the Agreement
without the approval of a majority of the outstanding shares of
the Fund. The Agreement may also be terminated at any time by a
majority vote of the disinterested Trustees, or by a majority of
the outstanding shares of the Fund or by the Distributor. Any
agreement with a qualifying broker-dealer or other financial
intermediary may be terminated without penalty on not more than
sixty days' written notice by a vote of the majority of non-party
Trustees, by a vote of a majority of the outstanding shares of
the Fund, or by the Distributor and will terminate automatically
in the event of its assignment.

PURCHASE AND REDEMPTION OF SHARES

<PAGE>

Accounts Not Maintained Through Financial Intermediaries

Opening Accounts -- New Investments

A. When Funds are Sent by Wire (the wire method permits
immediate credit)

2) Instruct your bank to wire Federal funds (minimum
$1,000) exactly as follows:

ABA 0110 0002 8
State Street Bank and Trust Company
Boston, MA 02101
Alliance Money Reserves
DDA 9903-279-9

Your account name as registered
Your account number with the Fund

3) Mail a completed Application Form to:
Alliance Fund Services, Inc.
P.O. Box 1520
Secaucus, New Jersey 07096-1520

B. When Funds are Sent by Check

1) Fill out an Application Form.

2) Mail the completed Application Form along with your
check or negotiable bank draft (minimum $1,000),
payable to "Alliance Money Reserves," to Alliance
Fund Services, Inc. as in A(3) above.

Subsequent Investments

A. Investments by Wire (to obtain immediate credit)

Instruct your bank to wire Federal funds (minimum $100)
to State Street Bank and Trust Company ("State Street Bank") as
in A(2) above.

<PAGE>

B. Investments by Check

Mail your check or negotiable bank draft (minimum $100),
payable to "Alliance Money Reserves," to Alliance Fund Services,
Inc. as in A(3) above.

Investments Made by Check

Redemptions

C. By Telephone

If your telephone redemption order is received by
Alliance Fund Services, Inc. prior to 12:00 Noon (New York time),
we will send the proceeds in Federal funds by wire to your
designated bank account that day. The minimum amount for a wire
is $1,000. If your telephone redemption order is received by
Alliance Fund Services, Inc. after 12:00 Noon and before 4:00
p.m., we will wire the proceeds the next business day. You also
may request that proceeds be sent by check to your designated
bank. Redemptions are made without any charge to you.

<PAGE>

During periods of drastic economic or market
developments, such as the market break of October 1987, it is
possible that shareholders would have difficulty in reaching
Alliance Fund Services, Inc. by telephone (although no such
difficulty was apparent at any time in connection with the 1987
market break). If a shareholder were to experience such
difficulty, the shareholder should issue written instructions to
Alliance Fund Services, Inc. at the address shown on the cover of
this statement of additional information. The Fund reserves the
right to suspend or terminate its telephone redemption service at
any time without notice. Neither the Fund nor the Adviser, or
Alliance Fund Services, Inc. will be responsible for the
authenticity of telephone requests for redemptions that the Fund
reasonably believes to be genuine. The Fund will employ
reasonable procedures in order to verify that telephone requests
for redemptions are genuine, including among others, recording
such telephone instructions and causing written confirmations of
the resulting transactions to be sent to shareholders. If the
Fund did not employ such procedures, it could be liable for
losses arising from unauthorized or fraudulent telephone
instructions. Selected dealers or agents may charge a commission
for handling telephone requests for redemptions.

D. By Check-Writing

With this service, you may write checks made payable to
any payee in any amount of $100 or more. Checks cannot be
written for more than the principal balance (not including any
accrued dividends) in your account. First, you must fill out the
Signature Card which is with the Application Form. If you wish
to establish this check-writing service, except that State Street
Bank will impose its normal charges for checks which are returned
unpaid because of insufficient funds or for checks upon which you
have placed a stop order.

THE CHECK-WRITING SERVICE ENABLES YOU TO RECEIVE THE DAILY
DIVIDENDS DECLARED ON THE SHARES TO BE REDEEMED UNTIL THE DAY
THAT YOUR CHECK IS PRESENTED TO STATE STREET BANK FOR PAYMENT.

E. By Mail

You may withdraw any amount from your account at any
time by mail. Written orders for withdrawal, accompanied by duly
endorsed certificates, if issued, should be mailed to Alliance
Fund Services, Inc., P.O. Box 1520, Secaucus, New Jersey 07096-
1520. Such orders must include the account name as registered
with the Fund and the account number. All written orders for
redemption, and accompanying certificates, if any, must be signed
by all owners of the account with the signatures guaranteed by an
institution which is an "eligible guarantor" as defined in Rule
17 Ad-15 under the Securities Exchange Act of 1934, as amended.

<PAGE>

Additional Information

<PAGE>

The Alliance Plans Division of Frontier Trust Company, a
subsidiary of The Equitable Life Assurance Society of the United
States, is the custodian under these plans. The custodian
charges a nominal account establishment fee and a nominal annual
maintenance fee. A portion of such fees is remitted to AFS to
compensate that organization for services rendered to retirement
plan accounts maintained with the Fund.

<PAGE>

in any specified amount of $50 or more each month or in any
intermittent pattern of months. If desired, you can order, via a
signature-guaranteed letter to the Fund, such periodic payments
to be sent to another person. Shareholders wishing either of the
above plans electronically through the ACH network should write
or telephone the Fund or AFS at (800) 221-5672.

DAILY DIVIDENDS-DETERMINATION OF NET ASSET VALUE

All net income of the Fund is determined after the close of
each business day, currently 4:00 p.m. (New York time) (and at
such other times as the Trustees may determine) and is paid
immediately thereafter pro rata to shareholders of record via
automatic investment in additional full and fractional shares in
each shareholder's account at the rate of one share for each
dollar distributed. As such additional shares are entitled to

<PAGE>

dividends on following days, a compounding growth of income
occurs.

The Fund utilizes the amortized cost method of valuation of
portfolio securities in accordance with the provisions of Rule
2a-7 under the Act. Pursuant to such rule, the Fund maintains a
dollar-weighted average portfolio maturity of 90 days or less and
invests only in securities of high quality. The Fund also
purchases instruments which, at the time of investment, have
remaining maturities of no more than one year which maturities
may extend to 397 days. The Fund maintains procedures designed
to stabilize, to the extent reasonably possible, the price per
share as computed for the purpose of sales and redemptions at
$1.00. Such procedures include review of the Fund's portfolio
holdings by the Trustees at such intervals as they deem
appropriate to determine whether and to what extent the net asset
value of the Fund calculated by using available market quotations
or market equivalents deviates from net asset value based on
amortized cost. If such deviation exceeds 1/2 of 1%, the
Trustees will promptly consider what action, if any, should be
initiated. In the event the Trustees determine that such a
deviation may result in material dilution or other unfair results
to new investors or existing shareholders, they will consider
corrective action which might include (1) selling instruments
prior to maturity to realize capital gains or losses or to
shorten average portfolio maturity; (2) withholding dividends of
net income on shares; or (3) establishing a net asset value per
share using available market quotations or equivalents. There
can be no assurance, however, that the Fund's net asset value per
share will remain constant at $1.00.

<PAGE>

TAXES

The Fund has qualified to date and intends to qualify in each
future year to be taxed as a regulated investment company under
the Internal Revenue Code of 1986, as amended, (the "Code"), and
as such, will not be liable for Federal income and excise taxes
on the net income and capital gains distributed to its
shareholders. Since the Fund distributes all of its net income
and capital gains, the Fund itself should thereby avoid all
Federal income and excise taxes.

General Information

Portfolio Transactions. Subject to the general
supervision of the Trustees of the Fund, the Adviser is
responsible for the investment decisions and the placing of the
orders for portfolio transactions for the Fund. Because the Fund
invests in securities with short maturities, there is a
relatively high portfolio turnover rate. However, the turnover
rate does not have an adverse effect upon the net yield and net
asset value of the Fund's shares since the Fund's portfolio
transactions occur primarily with issuers, underwriters or major
dealers in money market instruments acting as principals. Such
transactions are normally on a net basis which does not involve
payment of brokerage commissions. The cost of securities

<PAGE>

purchased from an underwriter usually includes a commission paid
by the issuer to the underwriters; transactions with dealers
normally reflect the spread between bid and asked prices.

Capitalization. All shares of the Fund, when issued, are
fully paid and non-assessable. The Trustees are authorized to
reclassify and issue any unissued shares to any number of
additional classes or series without shareholder approval.
Accordingly, the Trustees in the future, for reasons such as the
desire to establish additional portfolios with different
investment objectives, policies or restrictions may create
additional classes or series of shares. Any issuance of shares
of additional classes would be governed by the Act and the law of
the Commonwealth of Massachusetts. Shares of each portfolio are
normally entitled to one vote for all purposes. Generally,
shares of all portfolios vote as a single series for the election
of Trustees and on any other matter affecting all portfolios in
substantially the same manner. As to matters affecting each
portfolio differently, such as approval of the Advisory Agreement
and changes in investment policy, shares of each portfolio vote
as separate classes. Certain procedures for the removal by
shareholders of trustees of investment trusts, such as the Trust,
are set forth in Section 16(c) of the Act.

Legal Matters. The legality of the shares offered hereby has
been passed upon by Seward & Kissel, One Battery Park Plaza, New
York, New York, counsel for the Trust and the Adviser. Seward &
Kissel has relied upon the opinion of Sullivan & Worcester,
Boston, Massachusetts, for matters relating to Massachusetts law.

Auditors. An opinion relating to the Fund's financial
statements is given herein by McGladrey & Pullen, LLP, New York,
New York, independent auditors for the Trust.

<PAGE>

Yield Quotations. Advertisements containing yield quotations
for the Fund may from time to time be sent to investors or placed
in newspapers, magazines or other media on behalf of the Fund.
These advertisements may quote performance rankings, ratings or
data from independent organizations or financial publications
such as Lipper Analytical Services, Inc., Morningstar, Inc.,
IBC's Money Fund Report, IBC's Money Market Insight or Bank Rate
Monitor or compare the Fund's performance to bank money market
deposit accounts, certificates of deposit or various indices.
Such yield quotations are calculated in accordance with the
standardized method referred to in Rule 482 under the Securities
Act of 1933. Yield quotations are thus determined by (i)
computing the net changes over a seven-day period, exclusive of
capital changes, in the value of a hypothetical pre-existing
account having a balance of one share at the beginning of such
period, (ii) dividing the net change in account value by the
value of the account at the beginning of such period, and (iii)
multiplying such base period return by (365/7)--with the
resulting yield figure carried to the nearest hundredth of one
percent. The Fund's effective annual yield represents a
compounding of the annualized yield according to the following
formula:

effective yield = [(base period return + 1)365/7] - 1.

Dividends for the seven days ended June 30, 1995 amounted to
an annualized yield of 5.12% equivalent to an effective yield of
5.25%. Current yield information can be obtained by a recorded
message by telephoning toll-free at (800) 221-9513 or in New York
State at (212) 785-9106.

Additional Information. This Statement of Additional
Information does not contain all the information set forth in the
Registration Statement filed by the Trust with the Securities and
Exchange Commission under the Securities Act of 1933. Copies of
the Registration Statement may be obtained at a reasonable charge
from the Commission or may be examined, without charge, at the
Commission's offices in Washington, D.C.

<PAGE>

APPENDIX

Prime-1, Prime-2, A-1, A-2, Fitch-1, Fitch-2,
Duff 1 and Duff 2 Commercial Paper Ratings
_____________________________________________

The Fund will invest only in paper maintaining a high quality
rating.

"Prime-1" is the highest commercial paper rating assigned by
Moody's Investors Services, Inc. ("Moody's"), and indicates
superior ability for repayment of senior short-term debt
obligations. "Prime-2" is the second highest, and denotes a
strong, but somewhat lesser degree of assurance. Commercial
paper issuers rated "Prime" have the following characteristics:
their short-term debt obligations carry the smallest degree of
investment risk; margins of support for current indebtedness are
large or stable with cash flow and asset protection well assured;
current liquidity provides ample coverage of near-term
liabilities and unused alternative financing arrangements are
generally available; and while protective elements may change
over the intermediate or longer term, such changes are most
unlikely to impair the fundamentally strong position of short-
term obligations.

Commercial paper issuers rate "A" by Standard & Poor's have
the following characteristics: liquidity ratios are better than
industry average; long term debt is "A" or better; the issuer has
access to at least two additional channels of borrowing; basic
earnings and cash flow are in an upward trend; and typically, the
issuer is a strong company in a well-established industry with
superior management. Standard & Poor's uses the numbers 1+, 1, 2
and 3 to denote relative strength within its highest
classification of "A". The numbers 1 and 2 indicate the relative
degree of safety regarding timely payment with "A-1" paper being
somewhat higher than "A-3".

Commercial paper rated "Fitch-1" is considered to be the
highest grade paper and is regarded as having the strongest
degree of assurance for timely payment. "Fitch-2" is considered
very good grade paper and reflects an assurance of timely payment
only slightly less in degree than the strongest issue.

Commercial paper issues rated "Duff 1" by Duff & Phelps, Inc.
have the following characteristics: very high certainty of
timely payment, excellent liquidity factors supported by strong
fundamental protection factors, and risk factors which are very
small. Issues rated "Duff 2" have a good certainty of timely

<PAGE>

payment, sound liquidity factors and company fundamentals, small
risk factors, and good access to capital markets.

Bonds rated "AAA" and "Aaa" have the highest ratings assigned
to debt obligations by Standard & Poor's and Moody's,
respectively. Standard & Poor's "AAA" rating indicates an
extremely strong capacity to pay principal and interest. Bonds
rated "AA" by Standard & Poor's also qualify as high-quality debt
obligations. Capacity to pay principal and interest is very
strong, and in the majority of instances they differ from "AAA"
issues only in small degree. Standard & Poor's "A" rated bonds
have a strong capacity to pay interest and repay principal but
are somewhat more susceptible to the adverse effects of change in
circumstances and economic conditions than are higher rated
bonds.

Moody's "Aaa" rating indicates the ultimate degree of
protection as to principal and interest. Moody's "Aa" rated
bonds, though also high-grade issues, are rated lower than "Aaa"
bonds because margins of protection may not be as large,
fluctuations of protective elements may be of greater amplitude
or there may be other elements present which make the long term
risks appeal somewhat larger. Moody's "A" rated bonds are
considered upper medium grade obligations possessing many
favorable investment attributes. Although factors giving
security to principal and interest are considered adequate,
elements may exist which suggest that the bonds may be
susceptible to impairment sometime in the future.

31
00250122.AC7

<PAGE>

STATEMENT OF NET ASSETS
JUNE 30, 1995 ALLIANCE MONEY RESERVES
- -------------------------------------------------------------------------------
PRINCIPAL
AMOUNT
(000) SECURITY+ YIELD VALUE
- ----------------------------------------------------------------------
COMMERCIAL PAPER-66.5%
ABBEY NATIONAL
$ 31,460 9/07/95 5.82% $31,114,150
AES BARBERS POINT, INC.
35,000 7/27/95 6.02 34,847,828
5,000 7/07/95 6.06 4,994,950
AGA CAPITAL CORP.
17,000 7/17/95 6.05 16,954,289
AKZO NOBEL, INC.
23,600 8/31/95 5.86 23,365,665
ALLIANZ OF AMERICA FINANCE CORP.
10,000 7/05/95 6.15 9,993,167
19,500 9/05/95 6.25 19,276,562
AMERICAN BANKERS INSURANCE GROUP, INC.
16,000 9/06/95 5.80 15,827,289
BANK OF NEW YORK
15,000 7/20/95 5.97 14,952,738
BAYER, INC.
40,000 7/31/95 5.94 39,802,000
25,000 7/18/95 5.95 24,929,757
11,000 7/06/95 5.96 10,990,894
BHF FINANCE DELAWARE, INC.
45,000 8/02/95 5.99 44,760,400
CAISSE DES DEPOTS ET CONSIGNATIONS
25,000 8/28/95 5.94 24,760,750
50,000 7/24/95 5.96 49,809,611
CARGILL, INC.
20,000 7/19/95 5.95 19,940,500
CHEMICAL BANKING CORP.
40,000 9/13/95 5.85 39,519,000
CHIAO TUNG BANK CO., LTD.
31,000 7/19/95 5.99 30,907,155
CREGEM NORTH AMERICA, INC.
50,000 7/14/95 6.03 49,891,125
DEUTSCHE BANK FINANCIAL, INC.
15,000 7/07/95 5.88 14,985,300
30,000 7/07/95 5.95 29,970,250
DRESDNER US FINANCE, INC.
37,000 9/05/95 5.70 36,613,350
DUPONT (E. I.) DE NEMOURS & CO.
8,790 7/11/95 5.95 8,775,472
30,000 10/11/95 6.05 29,485,750
20,000 1/09/96 6.08 19,351,467
EKSPORTFINANS
40,000 8/09/95 5.93 39,743,033
EUROPEAN INVESTMENT BANK
15,000 7/12/95 5.98 14,972,592
EXPORT DEVELOPMENT CORP.
52,500 7/13/95 5.95% $52,395,875
FINANCE ONE FUNDING CORP.
20,000 8/11/95 5.90 19,865,611
15,000 11/07/95 5.90 14,682,875
FORD MOTOR CREDIT CORP.
20,000 9/05/95 5.88 19,784,400
25,000 7/12/95 6.09 24,953,479
GALICIA FUNDING
15,000 9/29/95 6.20 14,767,500
GENERAL ELECTRIC CREDIT CORP.
45,000 9/05/95 5.70 44,529,750
15,000 7/26/95 6.00 14,937,500
GOLDMAN SACHS GROUP LP
35,000 7/27/95 5.95 34,849,597
HALIFAX BUILDING SOCIETY
25,000 11/02/95 5.89 24,492,806
25,000 9/15/95 5.92 24,687,555
IMI FUNDING CORP. (USA)
9,766 9/15/95 6.20 9,638,174
IOWA STUDENT LOAN LIQUIDITY CORP.
22,670 7/10/95 5.98 22,636,108
KINGDOM OF SWEDEN
35,000 8/21/95 5.91 34,706,963
25,000 9/08/95 6.28 24,699,083
MITSUBISHI MOTORS CREDIT OF AMERICA
15,000 7/25/95 6.02 14,939,800
MORGAN STANLEY GROUP, INC.
60,000 7/07/95 6.00 59,940,000
MPS US, INC.
30,000 8/03/95 6.02 29,834,450
NORDIC INVESTMENT BANK
30,000 7/07/95 5.92 29,970,400
10,000 7/03/95 5.97 9,996,683
ODC CAPITAL CORP.
19,450 7/18/95 5.97 19,395,167
PACIFIC DUNLOP HOLDINGS, INC.
22,701 7/31/95 6.20 22,583,712
PROVINCE OF QUEBEC
35,000 12/11/95 6.19 34,019,057
15,000 12/08/95 6.22 14,585,333
QUEENSLAND ALUMINA
10,997 7/18/95 6.04 10,965,634
RAYTHEON CO.
22,000 7/13/95 5.94 21,956,440

ALLIANCE MONEY RESERVES
- -------------------------------------------------------------------------------
PRINCIPAL
AMOUNT
(000) SECURITY+ YIELD VALUE
- ----------------------------------------------------------------------
SANTANDER FINANCE DELAWARE
$ 45,000 11/08/95 5.92% $44,038,000
SEVENTY FIVE STATE STREET CAPITAL CORP.
48,054 7/14/95 6.02 47,949,536
SKANDINAVISKA ENSKILDA BANKEN
25,000 9/11/95 6.24 24,688,000
SMITHKLINE BEECHAM
20,000 7/14/95 5.80 19,958,111
30,000 2/02/96 5.87 28,944,300
SOCIETE GENERAL N.A., INC.
15,000 9/25/95 5.95 14,786,792
SVENSKA HANDELSBANKEN
20,000 9/01/95 5.90 19,796,778
27,000 8/04/95 5.95 26,848,275
TELSTRA CORP.
20,000 7/20/95 5.95 19,937,194
TOMEN AMERICA, INC.
10,000 7/07/95 5.95 9,990,083
TOYOTA MOTOR CREDIT CORP.
20,000 8/02/95 5.94 19,894,400
UBFC, INC.
16,000 7/11/95 5.95 15,973,556
VATTENFALL TREASURY, INC.
25,000 8/04/95 6.11 24,855,736
Total Commercial Paper
(amortized cost $1,668,009,757) 1,668,009,757

BANK OBLIGATIONS-14.2%
AFRICAN DEVELOPMENT BANK
5,000 10.50%, 11/01/95 6.48 5,062,702
AMERICAN EXPRESS CENTURION BANK
25,000 5.98%, 7/24/95 5.98 25,000,000
BANK OF AMERICA ILLINOIS
20,000 5.90%, 8/15/95 5.93 19,999,257
BANK OF NEW YORK
10,000 6.25%, 8/02/95 6.40 9,998,574
BANK ONE CHICAGO N. A.
10,000 5.40%, 7/27/95 5.83 9,997,024
BANK ONE INDIANAPOLIS
25,000 5.98%, 8/01/95 5.98 25,000,000
BANK ONE MILWAUKEE
5,000 5.98%, 7/31/95 5.93 5,000,174
15,000 6.82%, 3/07/96 6.68 15,010,738
BOATMENS FIRST NATIONAL BANK OF KANSAS CITY
16,000 6.11%, 8/18/95 FRN 6.17 15,998,851
CHASE MANHATTAN CORP.
10,000 7.59%, 1/30/96 6.75% $10,045,287
COMERICA BANK DETROIT MICHIGAN
15,000 5.64%, 9/29/95 FRN 5.71 14,997,493
19,000 5.62%, 11/22/95 FRN 5.78 18,988,748
FIFTH THIRD BANK
25,000 6.08%, 11/10/95 6.08 25,000,000
27,000 6.20%, 10/26/95 6.20 27,000,000
NATIONAL BANK OF DETROIT
20,000 6.32%, 10/12/95 6.32 20,000,000
NATIONSBANK DALLAS
10,000 7.00%, 2/06/96 7.20 9,987,953
NATIONSBANK NORTH CAROLINA
10,000 5.75%, 7/21/95 5.77 9,999,583
REPUBLIC NATIONAL BANK
35,000 4.90%, 7/27/95 6.03 34,967,734
STATE STREET BANK
25,000 5.83%, 9/05/95 5.90 24,996,198
WACHOVIA BANK
10,000 4.30%, 8/07/95 6.63 9,976,661
6,000 5.38%, 12/22/95 6.71 5,963,267
WORLD SAVINGS & LOAN ASSOC.
14,200 4.88%, 3/01/96 6.00 14,023,267
Total Bank Obligations
(amortized cost $357,013,511) 357,013,511

CERTIFICATES OF DEPOSIT-12.9%
BANQUE NATIONALE DE PARIS
20,000 5.83%, 8/04/95 5.92 19,998,280
BAYERISCHE HYPOBANK
25,000 6.10%, 7/19/95 6.08 25,000,170
22,000 6.11%, 7/14/95 6.08 22,000,130
CARIPLO
20,500 6.62%, 7/13/95 6.26 20,501,934
CREDIT SUISSE
7,000 6.13%, 10/05/95 5.75 7,006,276
HESSISCHE LANDESBANK GIROZENTRALE
10,000 6.05%, 7/14/95 6.05 9,999,982
MORGAN GUARANTY TRUST CO.
5,000 6.61%, 7/31/95 6.03% $5,001,938
NORINCHUKIN BANK
25,000 6.02%, 7/17/95 6.01 25,000,110
RABOBANK NEDERLAND
20,000 6.18%, 11/03/95 6.10 20,005,319
SOCIETE GENERALE N.A., INC.
35,000 6.13%, 7/05/95 6.09 35,000,114
SUMITOMO BANK
40,000 6.02%, 7/17/95 6.01 40,000,177

STATEMENT OF NET ASSETS (CONTINUED) ALLIANCE MONEY RESERVES
- -------------------------------------------------------------------------------
PRINCIPAL
AMOUNT
(000) SECURITY+ YIELD VALUE
- ----------------------------------------------------------------------
SWISS BANK
$ 95,000 6.01%, 7/21/95 6.00% $95,000,365
Total Certificates of Deposit
(amortized cost $324,514,795) 324,514,795

CORPORATE OBLIGATIONS-4.8%
ABBEY NATIONAL TREASURY SERVICES
10,000 7.40%, 12/15/95 6.60 10,030,401
10,000 7.05%, 3/01/96 7.05 10,000,000
BEAR STEARNS COS., INC.
15,000 6.14%, 7/14/95 FRN 6.14 15,000,000
10,000 6.16%, 1/26/96 FRN 6.16 10,000,000
10,000 6.18%, 10/20/95 FRN 6.18 10,000,000
BETA FINANCE CORP., LTD.
10,000 5.52%, 11/08/95 FRN* 5.52 10,000,000
FORD MOTOR CREDIT CORP.
5,000 8.88%, 3/15/96 6.70 5,072,716
GOLDMAN SACHS GROUP
20,000 5.53%, 11/02/95 FRN* 5.53 20,000,000
MERRILL LYNCH & CO.
10,000 5.62%, 3/25/96 FRN 5.62 10,000,000
15,000 6.95%, 2/27/96 7.00 15,000,000
PACCAR FINANCIAL
5,000 5.75%, 8/15/95 6.07 4,996,720
Total Corporate Obligations
(amortized cost $120,099,837) 120,099,837

U.S. GOVERNMENT & AGENCY OBLIGATIONS-1.0%
FEDERAL HOME LOAN MORTGAGE CORP.-1.0%
25,000 7/03/95
(amortized cost $24,991,528) 6.10% $24,991,528

BANKERS ACCEPTANCE-0.4%
BANK OF TOKYO
10,050 7/20/95
(amortized cost$10,015,682) 6.47 10,015,682

TOTAL INVESTMENTS-99.8%
(amortized cost $2,504,645,110) 2,504,645,110
Other assets less liabilities-0.2% 4,954,874

NET ASSETS-100%
(offering and redemption price of
$1.00 per share; 2,511,011,583
shares outstanding) $2,509,599,984

- -------------------------------------------------------------------------------
+ All securities either mature or their interest rate changes in one year or
less.
* Restricted security (see Note F).

Glossary of Terms:
FRN - Floating Rate Note
See notes to financial statements.

STATEMENT OF OPERATIONS
YEAR ENDED JUNE 30, 1995 ALLIANCE MONEY RESERVES
- -------------------------------------------------------------------------------

INVESTMENT INCOME
Interest $109,833,529

EXPENSES
Advisory fee (Note B) $9,777,831
Distribution assistance and administrative
service (Note C) 6,951,676
Transfer agency 2,859,543
Printing 368,119
Registration fees 364,678
Custodian fees 275,214
Audit and legal fees 74,495
Trustees' fees 16,811
Miscellaneous 39,627
Total expenses 20,727,994
Less: expense reimbursement and fee waiver (881,544)
19,846,450
Net investment income 89,987,079

REALIZED LOSS ON INVESTMENTS
Net realized loss on investments (479,849)

NET INCREASE IN NET ASSETS FROM OPERATIONS $89,507,230

STATEMENTS OF CHANGES IN NET ASSETS
- -------------------------------------------------------------------------------

YEAR ENDED YEAR ENDED
JUNE 30,1995 JUNE 30,1994
-------------- --------------
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
Net investment income $89,987,079 $45,487,973
Net realized loss on investments (479,849) (64,655)
Net increase in net assets from operations 89,507,230 45,423,318

DIVIDENDS TO SHAREHOLDERS FROM:
Net investment income (89,987,079) (45,487,973)

TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST
Net increase 714,092,254 170,535,622
Total increase 713,612,405 170,470,967

NET ASSETS
Beginning of year 1,795,987,579 1,625,516,612
End of year $2,509,599,984 $1,795,987,579

See notes to financial statements.

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1995 ALLIANCE MONEY RESERVES
- -------------------------------------------------------------------------------
NOTE A: SIGNIFICANT ACCOUNTING POLICIES
Alliance Capital Reserves (the 'Trust') is an open-end diversified investment
company registered under the Investment Company Act of 1940. The Trust consists
of two portfolios: Alliance Capital Reserves and Alliance Money Reserves (the
'Portfolio'). Each portfolio is considered to be a separate entity for
financial reporting and tax purposes. The following is a summary of significant
accounting policies followed by the Portfolio.

4. GENERAL
Interest income is accrued as earned. Security transactions are recorded on a
trade date basis. Realized gain (loss) from security transactions is recorded
on the identified cost basis.

NOTE B: ADVISORY FEE AND TRANSACTIONS WITH AN AFFILIATE OF THE ADVISER
The Portfolio pays its Adviser, Alliance Capital Management L.P., an advisory
fee at the annual rate of .50 of 1% on the first $1.25 billion of average daily
net assets; .49 of 1% on the next $.25 billion; .48 of 1% on the next $.25
billion; .47 of 1% on the next $.25 billion; .46 of 1% on the next $1 billion;
and .45 of 1% in excess of $3 billion. The Adviser has agreed to reimburse the
Portfolio to the extent that its aggregate expenses (excluding taxes,
brokerage, interest and, where permitted, extraordinary expenses) exceed 1% of
its average daily net assets for any fiscal year. For the year ended June 30,
1995, the reimbursement amounted to $87,685. The Portfolio compensates Alliance
Fund Services, Inc. (a wholly-owned subsidiary of the Adviser) for providing
personnel and facilities to perform transfer agency services for the Portfolio.
Such compensation amounted to $1,362,327 for the year ended June 30, 1995.

NOTE C: DISTRIBUTION ASSISTANCE AND ADMINISTRATIVE SERVICES PLAN
Under this plan, the Portfolio pays the Adviser a distribution fee at the
annual rate of up to .25 of 1% of the average daily value of the Portfolio's
net assets. The Plan provides that the Adviser will use amounts payable under
the Plan in their entirety for (i) payments to broker-dealers and other
financial intermediaries, including the Portfolio's distributor, for
distribution assistance and payments to banks and other depository institutions
for administrative and accounting services and (ii) otherwise promoting the
sale of shares of the Portfolio. For the year ended June 30, 1995 the Portfolio
incurred fees of $4,961,613 of which $793,859 was waived. In addition, the
Portfolio reimbursed certain broker-dealers for administrative costs incurred
in connection with providing shareholder services, accounting and bookkeeping,
and legal and compliance support. For the year ended June 30, 1995 such
payments by the Portfolio amounted to $1,990,063 of which $140,000 was paid to
the Adviser.

ALLIANCE MONEY RESERVES
- -------------------------------------------------------------------------------
NOTE D: INVESTMENT TRANSACTIONS
At June 30, 1995, the cost of portfolio securities for federal income tax
purposes was the same as the cost for financial reporting purposes. At June 30,
1995, the Portfolio had a capital loss carryforward of $1,411,599 of which
$794,283 expires in 1999, $72,812 expires in 2001, $64,655 expires in 2002 and
$479,849 expires in 2003.

NOTE E: TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST
An unlimited number of shares ($.001 par value) are authorized. At June 30,
1995, capital paid-in aggregated $2,511,011,583. Transactions, all at $1.00 per
share, were as follows:

YEAR ENDED YEAR ENDED
JUNE 30, 1995 JUNE 30, 1994
--------------- ---------------
Shares sold 8,315,302,942 7,454,664,537
Shares issued on reinvestments of dividends 89,987,079 45,508,231
Shares redeemed (7,691,197,767) (7,329,637,146)
Net increase 714,092,254 170,535,622

NOTE F: RESTRICTED SECURITIES
The following securities are restricted as to resale except among qualified
institutional investors such as the Portfolio.

DATE % OF NET
SECURITY ACQUIRED VALUE ASSETS
- -------- -------- ----------- --------
Beta Finance Corp., Ltd., 5.52%, 11/08/95 FRN 11/08/94 $10,000,000 .40%
Goldman Sachs Group, 5.53%, 11/02/95 FRN 11/02/94 20,000,000 .80
----------- -------
$30,000,000 1.20%

NOTES TO FINANCIAL STATEMENTS (CONTINUED) ALLIANCE MONEY RESERVES
- -------------------------------------------------------------------------------
NOTE G: FINANCIAL HIGHLIGHTS
Selected data for a share outstanding throughout each period.

<TABLE>
<CAPTION>
YEAR ENDED JUNE 30,
-----------------------------------------------
1995 1994 1993 1992 1991
------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00

INCOME FROM INVESTMENT OPERATIONS
Net investment income .045 .025 .027 .044 .066

LESS: DISTRIBUTIONS
Dividends from net investment income (.045) (.025) (.027) (.044) (.066)
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00

TOTAL RETURN
Total investment return based on:
net asset value (a) 4.50% 2.57% 2.71% 4.47% 6.87%

RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in millions) $2,510 $1,795 $1,626 $1,412 $1,262
Ratio to average net assets of:
Expenses, net of waivers and reimbursements 1.00% 1.00% 1.00% 1.00% .97%
Expenses, before waivers and reimbursements 1.04% 1.09% 1.04% 1.04% 1.00%
Net investment income 4.53% 2.55% 2.67% 4.33% 6.56%
</TABLE>

INDEPENDENT AUDITOR'S REPORT ALLIANCE MONEY RESERVES
- -------------------------------------------------------------------------------

TO THE BOARD OF TRUSTEES AND SHAREHOLDERS ALLIANCE MONEY RESERVES PORTFOLIO
We have audited the accompanying statement of net assets of Alliance Money
Reserves Portfolio as of June 30, 1995 and the related statements of
operations, changes in net assets, and financial highlights for the periods
indicated in the accompanying financial statements. These financial statements
and financial highlights are the responsibility of the Portfolio's management.
Our responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.

In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Alliance Money Reserves Portfolio as of June 30, 1995, and the results of its
operations, changes in its net assets, and its financial highlights for the
periods indicated, in conformity with generally accepted accounting principles.

MCGLADREY &PULLEN, LLP
New York, New York
August 8, 1995

00250122.AC7