FIDELITY PHILLIPS STREET TRUST
485BPOS, 1997-01-17
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT (No. 2-63350) 
  UNDER THE SECURITIES ACT OF 1933 [X]
 Pre-Effective Amendment No.           [  ]
 Post-Effective Amendment No. 41          [X]
and
REGISTRATION STATEMENT (No. 811-2890) 
 UNDER THE INVESTMENT COMPANY ACT OF 1940    [X]
 Amendment No.         [  ]
Fidelity Phillips Street Trust                          
(Exact Name of Registrant as Specified in Charter)
82 Devonshire St., Boston, Massachusetts 02109 
(Address Of Principal Executive Offices)  (Zip Code)
Registrant's Telephone Number:  617-563-7000 
Arthur S. Loring, Secretary
82 Devonshire Street
Boston, Massachusetts 02109 
(Name and Address of Agent for Service)
It is proposed that this filing will become effective
 (  ) immediately upon filing pursuant to paragraph (b).
 (x) on (January 18, 1997) pursuant to paragraph (b). 
 (  ) 60 days after filing pursuant to paragraph (a)(1).
 (  ) on (             ) pursuant to paragraph (a)(1) of Rule 485.
 (  ) 75 days after filing pursuant to paragraph (a)(2).
 (  ) on (            ) pursuant to paragraph (a)(2) of Rule 485.   
If appropriate, check the following box:
 (  ) this post-effective amendment designates a new effective date for a
previously filed 
      post-effective amendment.
Registrant has filed a declaration pursuant to Rule 24f-2 under the
Investment Company Act of 1940 and intends to file the Notice required by
such Rule before January 29, 1997.
FIDELITY PHILLIPS STREET TRUST:
FIDELITY CASH RESERVES
FIDELITY U.S. GOVERNMENT RESERVES
CROSS REFERENCE SHEET
 
Form N-1A                          
Item Number   Prospectus Section   
 
 
<TABLE>
<CAPTION>
<S>                                                   <C>                                                             
1.................................................    Cover Page                                                      
 ...                                                                                                                   
 
2a................................................    Expenses                                                        
 ..                                                                                                                    
 
                                                      Contents; The Funds at a Glance; Who May Want to Invest         
b,c...............................................                                                                    
 
3a...............................................     Financial Highlights                                            
 
                                                      *                                                               
b.................................................                                                                    
 .                                                                                                                     
 
                                                      Performance                                                     
c,d...............................................                                                                    
 
4a(i)                                                 Charter                                                         
 ..............................................                                                                        
 
                                                      The Funds at a Glance; Investment Principles and Risks          
(ii)..............................................                                                                    
 
                                                      Investment Principles and Risks                                 
b.................................................                                                                    
 .                                                                                                                     
 
                                                      Who May Want to Invest; Investment Principles and Risks         
c.................................................                                                                    
 .                                                                                                                     
 
5a                                                    Charter                                                         
 .................................................                                                                     
 
                                                      Cover Page; The Funds at a Glance; Charter; Doing Business      
b(i)..............................................    with Fidelity                                                   
 
  b(ii)                                               Charter                                                         
 ............................................                                                                          
 
                                                      Expenses; Breakdown of Expenses                                 
b(iii)...........................................                                                                     
 .                                                                                                                     
 
  c...............................................    Charter                                                         
 
                                                      Charter; Breakdown of Expenses                                  
d.................................................                                                                    
 .                                                                                                                     
 
                                                      Cover Page; Charter                                             
e.................................................                                                                    
 .                                                                                                                     
 
                                                      Expenses                                                        
f..................................................                                                                   
 .                                                                                                                     
 
 g(i).............................................    Charter                                                         
 
                                                      *                                                               
g(ii).............................................                                                                    
 
5A                                                    Performance                                                     
 ................................................                                                                      
 
6a(i)............................................     Charter                                                         
 ...                                                                                                                   
 
  a(ii)                                               How to Buy Shares; How to Sell Shares; Transaction Details;     
 ............................................          Exchange Restrictions                                           
 
                                                      Charter                                                         
a(iii)...........................................                                                                     
 
                                                      Charter                                                         
b.................................................                                                                    
 
                                                      Transaction Details; Exchange Restrictions                      
c................................................                                                                     
 
                                                      *                                                               
d.................................................                                                                    
 
                                                      Doing Business with Fidelity; How to Buy Shares; How to Sell    
e.................................................    Shares; Investor Services                                       
 
                                                      Dividends, Capital Gains, and Taxes                             
f,g...............................................                                                                    
 
7a................................................    Cover Page; Charter                                             
 ..                                                                                                                    
 
                                                      Expenses; How to Buy Shares; Transaction Details                
b.................................................                                                                    
 .                                                                                                                     
 
                                                      *                                                               
c.................................................                                                                    
 .                                                                                                                     
 
                                                      How to Buy Shares                                               
d.................................................                                                                    
 .                                                                                                                     
 
                                                      *                                                               
e.................................................                                                                    
 .                                                                                                                     
 
                                                      Breakdown of Expenses                                           
f..................................................                                                                   
 .                                                                                                                     
 
8.................................................    How to Sell Shares, Investor Services; Transaction Details;     
 ..                                                    Exchange Restrictions                                           
 
9.................................................    *                                                               
 ..                                                                                                                    
 
</TABLE>
 
*  Not Applicable
FIDELITY PHILLIPS STREET TRUST:
FIDELITY CASH RESERVES
FIDELITY U.S. GOVERNMENT RESERVES
CROSS REFERENCE SHEET
(CONTINUED)
 
Form N-1A                                                   
Item Number   Statement of Additional Information Section   
 
 
<TABLE>
<CAPTION>
<S>                                               <C>                                                             
10,                                               Cover Page                                                      
11........................................                                                                        
 
12.............................................   Description of the Trust                                        
 .                                                                                                                 
 
13a-c.......................................      Investment Policies and Limitations                             
 
                                                  Portfolio Transactions                                          
d............................................                                                                     
 
14a -                                             Trustees and Officers                                           
c........................................                                                                         
 
15a,                                              *                                                               
b.........................................                                                                        
 
                                                  Trustees and Officers                                           
c.............................................                                                                    
 
16a(i).......................................     FMR; Portfolio Transactions                                     
 ..                                                                                                                
 
                                                  Trustees and Officers                                           
a(ii)........................................                                                                     
 
    a(iii),                                       Management Contracts                                            
b...................................                                                                              
 
   c,                                             Contracts with FMR Affiliates                                   
d..........................................                                                                       
 
                                                  *                                                               
e.............................................                                                                    
 
                                                  Distribution and Service Plans                                  
f............................................                                                                     
 
                                                  *                                                               
g.............................................                                                                    
 
                                                  Description of the Trust                                        
h.............................................                                                                    
 
                                                  Contracts with FMR Affiliates                                   
i.............................................                                                                    
 
17a,                                              Portfolio Transactions                                          
b,c.......................................                                                                        
 
                                                  *                                                               
d,e.........................................                                                                      
 
18a...........................................    Description of the Trust                                        
 ..                                                                                                                
 
                                                  *                                                               
b.............................................                                                                    
 
19a...........................................    Additional Purchase and Redemption Information                  
 ..                                                                                                                
 
                                                  Additional Purchase and Redemption Information; Valuation of    
b............................................     Portfolio Securities                                            
 
                                                  *                                                               
c.............................................                                                                    
 
20.............................................   Distributions and Taxes                                         
 ..                                                                                                                
 
21a,b........................................     Contracts with FMR Affiliates                                   
 ..                                                                                                                
 
                                                  *                                                               
c.............................................                                                                    
 
22a...........................................    Performance                                                     
 ..                                                                                                                
 
                                                  *                                                               
b.............................................                                                                    
 
23.............................................   Financial Statements                                            
 ..                                                                                                                
 
</TABLE>
 
* Not Applicable
Please read this prospectus before investing, and keep it on file for
future reference. It contains important information, including how each
fund invests and the services available to shareholders.
To learn more about each fund and its investments, you can obtain a copy of
each fund's most recent financial report and portfolio listing, or a copy
of the Statement of Additional    Information (SAI) dated     January 18,
1997.    The SAI has been filed with the Securities and Exchange Commission
(SEC) and is available along with other related materials on the SEC's
Internet Web site (http://www.sec.gov). The     SAI is incorporated herein
by reference (legally forms a part of the prospectus). For a free copy of
either document, call Fidelity at 1-800-544-8888.
Investments in the funds are neither insured nor guaranteed by the U.S.
   G    overnment, and there can be no assurance that a fund will maintain
a stable $1.00 share price.
Mutual fund shares are not deposits or obligations of, or guaranteed by,
any depository institution. Shares are not insured by the FDIC, Federal
Reserve Board, or any other agency, and are subject to investment risks,
including possible loss of principal amount invested.
 
LIKE ALL MUTUAL 
FUNDS, 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.
   CAS/FUS-pro-019
7    
 
FIDELITY 
CASH 
RESERVES
AND
FIDELITY 
U.S. 
GOVERNMENT 
RESERVES
These money market funds seek high current income while maintaining a
stable $1.00 share price by investing in high-quality, short-term money
market securities. Cash Reserves invests in a broad range of money market
securities. 
   (fund number 55, trading symbol FDRXX)     
U.S. Government Reserves invests only in U.S.    G    overnment securities
or related instruments. 
   (fund number 50, trading symbol FGRXX).    
PROSPECTUS
        JANUARY 18, 1997(FIDELITY_LOGO_GRAPHIC) 82 DEVONSHIRE STREET,
BOSTON, MA 02109
CONTENTS
 
 
KEY FACTS                   THE FUNDS AT A GLANCE                 
 
                            WHO MAY WANT TO INVEST                
 
                            EXPENSES Each fund's yearly           
                            operating expenses.                   
 
                            FINANCIAL HIGHLIGHTS A summary        
                            of each fund's financial data.        
 
                            PERFORMANCE How each fund has         
                            done over time.                       
 
THE FUNDS IN DETAIL         CHARTER How each fund is              
                            organized.                            
 
                            INVESTMENT PRINCIPLES AND RISKS       
                            Each fund's overall approach to       
                            investing.                            
 
                            BREAKDOWN OF EXPENSES How             
                            operating costs are calculated and    
                            what they include.                    
 
YOUR ACCOUNT                DOING BUSINESS WITH FIDELITY          
 
                            TYPES OF ACCOUNTS Different           
                            ways to set up your account,          
                            including tax-sheltered retirement    
                            plans.                                
 
                            HOW TO BUY SHARES Opening an          
                            account and making additional         
                            investments.                          
 
                            HOW TO SELL SHARES Taking money       
                            out and closing your account.         
 
                            INVESTOR SERVICES Services to         
                            help you manage your account.         
 
SHAREHOLDER AND             DIVIDENDS, CAPITAL GAINS,             
ACCOUNT POLICIES            AND TAXES                             
 
                            TRANSACTION DETAILS Share price       
                            calculations and the timing of        
                            purchases and redemptions.            
 
                            EXCHANGE RESTRICTIONS                 
 
   KEY FACTS    
 
 
THE FUNDS AT A GLANCE
GOAL: Income while maintaining a stable $1.00 share price. As with any
mutual fund, there is no assurance that a fund will achieve its goal.
MANAGEMENT: Fidelity Management & Research Company (FMR) is the management
arm of Fidelity Investments, which was established in 1946 and is now
America's largest mutual fund manager. FMR Texas Inc. (FMR Texas), a
subsidiary of FMR, chooses investments for the funds.
CASH RESERVES
STRATEGY: Invests in high-quality, short-term money market securities of
all types.
SIZE: As of November 30, 1996, the fund had over $   21.2     billion in
assets. 
U.S. GOVERNMENT RESERVES
STRATEGY: Invests in high-quality, short-term money market securities
issued or guaranteed by the U.S.    G    overnment or government agencies.
SIZE: As of November 30, 1996, the fund had over $   1.2     billion in
assets.
WHO MAY WANT TO INVEST
These funds may be appropriate for investors who would like to earn income
at current money market rates while preserving the value of their
investment. The funds are managed to keep their share price stable at
$1.00. U.S. Government Reserves offers an added measure of credit safety
with its focus on U.S.    G    overnment securities. The rate of income
will vary from day to day, generally reflecting short-term interest rates.
These funds do not constitute a balanced investment plan. However, because
they emphasize stability, they could be well-suited for a portion of your
investments. Each fund offers free checkwriting to give you easy access to
your money.
THE SPECTRUM OF 
FIDELITY FUNDS 
Broad categories of Fidelity 
funds are presented here in 
order of ascending risk. 
Generally, investors seeking 
to maximize return must 
assume greater risk. The 
funds in this prospectus are 
in the MONEY MARKET 
category. 
(right arrow) MONEY MARKET Seeks 
income and stability by 
investing in high-quality, 
short-term investments.
(solid bullet) INCOME Seeks income by 
investing in bonds. 
(solid bullet) GROWTH AND INCOME 
Seeks long-term growth and 
income by investing in stocks 
and bonds.
(solid bullet) GROWTH Seeks long-term 
growth by investing mainly in 
stocks. 
(checkmark)
EXPENSES 
SHAREHOLDER TRANSACTION EXPENSES are charges you may pay when you buy or
sell shares of a fund. In addition, you may be charged an annual account
maintenance fee if your account balance falls below $2,500. See
"Transaction Details"    on     page        , for an explanation of how and
when these charges apply.
Maximum sales charge on purchases      None    
and reinvested distributions                   
 
Deferred sales charge on redemptions   None    
 
Exchange fee                           None    
 
Wire redemption fee                    $5.00   
 
Annual account maintenance fee         $12.0   
(for accounts under $2,500)            0       
 
ANNUAL FUND OPERATING EXPENSES are paid out of each fund's assets. Each
fund pays a management fee to FMR. It also incurs other expenses for
services such as maintaining shareholder records and furnishing shareholder
statements and financial reports. A fund's expenses are factored into its
share price or dividends and are not charged directly to shareholder
accounts (see page ).
The following figures are based on historical expenses, and are calculated
as a percentage of average net assets. Each fund has entered into
arrangements with its custodian and transfer agent whereby interest earned
on uninvested cash balances is used to reduce custodian and transfer agent
expenses. Including these reductions, the total operating expenses
presented in the table    remained unchanged     for Cash Reserves and
   would have been .50    % for U.S. Government Reserves.
CASH RESERVES
   Management fee                         .21%       
 
12b-1 fee                              None          
 
   Other expenses                         .30%       
 
   Total fund operating expenses          .51%       
 
U.S. GOVERNMENT RESERVES
   Management fee           .21%       
 
12b-1 fee                None          
 
   Other expenses                         .30%       
 
   Total fund operating expenses          .51%       
 
EXAMPLES: Let's say, hypothetically, that each fund's annual return is 5%
and that its operating expenses are exactly as just described. For every
$1,000 you invested, here's how much you would pay in total expenses if you
close your account after the number of years indicated:
CASH RESERVES 
   After 1 year            $ 5        
 
   After 3 years           $ 16       
 
   After 5 years           $ 29       
 
   After 10 years          $ 64       
 
U.S. GOVERNMENT RESERVES
   After 1 year            $ 5        
 
   After 3 years           $ 16       
 
   After 5 years           $ 29       
 
   After 10 years          $ 64       
 
These examples illustrate the effect of expenses, but are not meant to
suggest actual or expected costs or returns, all of which may vary.
FINANCIAL HIGHLIGHTS
The tables that follow are included in each fund's Annual Report and have
been audited by Coopers & Lybrand L.L.P. for Cash Reserves and Price
Waterhouse LLP for U.S. Government Reserves, independent accountants. Their
reports on the financial statements and financial highlights are included
in the Annual Reports. The financial statements and financial highlights
are incorporated by reference into (are legally a part of) the funds'
Statement of Additional Information.
   FIDELITY CASH RESERVES    
 
 
 
<TABLE>
<CAPTION>
<S>          <C>         <C>         <C>         <C>         <C>         <C>         <C>         <C>         <C>        <C>        
    1.Selected Per-Share Data and  
 Ratios                                                                  
 
 2.Years 
ended        1996        1995        1994        1993        1992        1991        1990        1989        1988        1987       
 November 30                                                                                                                
 
 3.Net asset 
value,       $ 1.00      $ 1.00      $ 1.00      $ 1.00      $ 1.00      $ 1.00      $ 1.00      $ 1.00      $ 1.00      $ 1.00     
 beginning   0           0           0           0           0           0           0           0           0           0          
 of period                                                                                                                    
 
 4.Income 
from          .051        .055        .037        .029        .038        .061        .076        .086        .069        .061      
 Investment                                                                                                                  
 Operations                                                                                                                  
  Net interest                                                          
 income                                                                 
 
 5.Less       (.051)      (.055)      (.037)      (.029)      (.038)      (.061)      (.076)      (.086)      (.069)      (.061)    
 Distributions                                                        
  From net interest                                                      
 income                                                                 
 
 6.Net asset 
value,       $ 1.00      $ 1.00      $ 1.00      $ 1.00      $ 1.00      $ 1.00      $ 1.00      $ 1.00      $ 1.00      $ 1.00     
 end         0           0           0           0           0           0           0           0           0           0          
 of period                                                              
 
 7.Total 
return        5.18        5.67        3.74        2.97        3.90        6.23        7.87        8.94        7.16        6.28      
             %           %           %           %           %           %           %           %           %           %          
 
 8.Net assets,  
end          $ 21,2      $ 18,4      $ 14,5      $ 10,3      $ 10,0      $ 10,5      $ 10,9      $ 10,8      $ 10,8      $ 9,28     
 of period   41          32          29          14          40          19          21          97          85          0          
 (In millions)                                                                                                                
 
 9.Ratio of  .51%        .55%        .52%        .48%        .48%        .58%        .69%        .74%        .65%        .70%      
 expenses to                                                          
 average net                                                             
 assets                                                                 
 
 10. Ratio of 
net          5.06        5.50        3.76        2.92        3.86        6.03        7.62        8.60        6.95        6.22      
interest     %           %           %           %           %           %           %           %           %           %          
income to                                                                    
average net                                                                  
assets                                                                  
 
</TABLE>
 
 FIDELITY U.S. GOVERNMENT RESERVES 
 
<TABLE>
<CAPTION>
<S>       <C>         <C>        <C>        <C>        <C>        <C>        <C>        <C>        <C>         <C>        <C>
 11.Selected Per-Share  
 Data and Ratios                                                                                                                    
                       
 21.Years 
ended     1996        1995       1994B       1994       1993       1992       1991       1990       1989       1988       1987      
 November 30                                 A          A          A          A          A          A          A          A         
 
 22.Net 
asset     $ 1.000     $ 1.0      $ 1.00      $ 1.0      $ 1.0      $ 1.0      $ 1.0      $ 1.0      $ 1.0      $ 1.0      $ 1.0     
 value, 
beginning             00         0           00         00         00         00         00         00         00         00        
 of period                                                                                                                 
 
 23.Income 
from      .050        .055       .008        .033       .025       .039       .061       .076       .083       .065       .056     
 Investment                                                                                                                  
 Operations                                                        
  Net interest                                                      
 income                                                              
 
 24.Less   (.050)      (.055      (.008)      (.033      (.025      (.039      (.061      (.076      (.083      (.065      (.056    
 Distributions         )                      )          )          )          )          )          )          )          )
  From net                                                          
 interest income                                                    
 
 25.Net 
asset     $ 1.000     $ 1.0      $ 1.00      $ 1.0      $ 1.0      $ 1.0      $ 1.0      $ 1.0      $ 1.0      $ 1.0      $ 1.0     
 value, end           00         0           00         00         00         00         00         00         00         00        
 of period                                                                                                                   
 
 26.Total 
return C   5.12%       5.60       .78%        3.32       2.57       3.95       6.29       7.86       8.66       6.73       5.79     
                       %                      %          %          %          %          %          %          %          %        
 
 27.Net 
assets,   $ 1,243     $ 1,1      $ 1,13      $ 1,0      $ 1,0      $ 1,2      $ 1,4      $ 1,5      $ 1,5      $ 1,5      $ 909     
 end of period        88         0           60         43         92         36         81         45         90            
 (In millions)                                                                                                              
 
 28.Ratio 
of       .51%        .55%       .36%D       .51%       .73%       .73%       .72%       .74%       .80%       .75%       .81%     
 expenses to                    ,F                                                                                           
 average net                                                       
 assets                                                             
 
 29.Ratio 
of        .50%E       .55%       .36%F       .51%       .73%       .73%       .72%       .74%       .80%       .75%       .81%     
 expenses to                                                                                                                 
 average net                                                        
 assets after                                                       
 expense                                                            
 reductions                                                        
 
 30.Ratio of 
net       5.02%       5.43       4.77%       3.27       2.57       3.88       6.13       7.66       8.29       6.52       5.79     
 interest income      %          F           %          %          %          %          %          %          %          %         
 to average net                                                    
 assets                                                             
    
</TABLE>
 
   A FOR THE FISCAL YEARS ENDED SEPTEMBER 30
B ON MARCH 17, 1994, THE TRUSTEES APPROVED A CHANGE IN THE FISCAL YEAR END
OF THE FUND FROM SEPTEMBER 30 TO NOVEMBER 30; ACCORDINGLY, THE FINANCIAL
HIGHLIGHTS ARE PRESENTED FOR THE TWO-MONTH PERIOD ENDED NOVEMBER 30, 1994.
C TOTAL RETURNS  FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED. THE
TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
D FMR AGREED TO REIMBURSE A PORTION OF THE FUND'S EXPENSES DURING THE
PERIOD. WITHOUT THIS REIMBURSEMENT, THE FUND'S EXPENSE RATIO WOULD HAVE
BEEN HIGHER.
E FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD PARTIES
WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES.
F ANNUALIZED.    
PERFORMANCE
Money market fund performance can be measured as TOTAL RETURN or YIELD. The
total returns that follow are based on historical fund results and do not
reflect the effect of taxes. 
   Each fund's fiscal year runs from December 1 through November 30. The
tables below show each fund's performance over past fiscal years compared
to a measure of inflation.    
AVERAGE ANNUAL TOTAL RETURNS
Fiscal periods ended   Pas   Past    Past    
November 30, 1996      t 1   5       10      
                       yea   year    year    
                       r     s       s       
 
Cash Reserves    5.18    4.29    5.78   
                %       %       %       
 
U.S. Government         5.12    4.10    5.56   
Reserves               %       %       %       
 
Consumer Price Index    3.26    2.85    3.69   
                       %       %       %       
 
CUMULATIVE TOTAL RETURNS
Fiscal periods ended   Pas   Past    Past    
November 30, 1996      t 1   5       10      
                       yea   year    year    
                       r     s       s       
 
Cash Reserves    5.18    23.35    75.37   
                %       %        %        
 
U.S. Government         5.12    22.25    71.78   
Reserves               %       %        %        
 
Consumer Price Index    3.26    15.09    43.66   
                       %       %        %        
 
EXPLANATION OF TERMS
TOTAL RETURN is the change in value of an investment over a given period,
assuming reinvestment of any dividends and capital gains. A CUMULATIVE
TOTAL RETURN reflects actual performance over a stated period of time. An
AVERAGE ANNUAL TOTAL RETURN is a hypothetical rate of return that, if
achieved annually, would have produced the same cumulative total return if
performance had been constant over the entire period. Average annual total
returns smooth out variations in performance; they are not the same as
actual year-by-year results. 
YIELD refers to the income generated by an investment in a fund over a
given period of time, expressed as an annual percentage rate. When a yield
assumes that income earned is reinvested, it is called an EFFECTIVE YIELD.
THE CONSUMER PRICE INDEX is a widely recognized measure of inflation
calculated by the U.S. Government.
The funds' recent strategies, performance, and holdings are detailed twice
a year in financial reports, which are sent to all shareholders. For
current performance call 1-800-544-8888.
TOTAL RETURNS AND YIELDS ARE BASED ON PAST RESULTS AND ARE NOT AN
INDICATION OF FUTURE PERFORMANCE.
UNDERSTANDING
PERFORMANCE
SEVEN-DAY YIELD illustrates 
the income earned by a 
money market fund over a 
recent seven-day period. TOTAL 
RETURN reflects both the 
reinvestment of income and 
the change in a fund's share 
price. Since money market 
funds maintain a stable $1.00 
share price, current seven-day 
yields are the most common 
illustration of money market 
fund performance.
(checkmark)
THE FUNDS IN DETAIL
 
 
CHARTER
EACH FUND IS A MUTUAL FUND: an investment that pools shareholders' money
and invests it toward a specified goal. Each fund is a diversified fund of
Fidelity Phillips Street Trust, an open-end management investment company
organized as a Delaware business trust on September 17, 1992.
EACH FUND IS GOVERNED BY A BOARD OF TRUSTEES which is responsible for
protecting the interests of shareholders. The trustees are experienced
executives who meet throughout the year to oversee the funds' activities,
review contractual arrangements with companies that provide services to the
funds, and review the funds' performance. The majority of trustees are not
otherwise affiliated with Fidelity.
THE FUNDS MAY HOLD SPECIAL MEETINGS AND MAIL PROXY MATERIALS. These
meetings may be called to elect or remove trustees, change fundamental
policies, approve a management contract, or for other purposes.
Shareholders not attending these meetings are encouraged to vote by proxy.
Fidelity will mail proxy materials in advance, including a voting card and
information about the proposals to be voted on. The number of votes you are
entitled to is based upon the dollar value of your investment.
FMR AND ITS AFFILIATES
The funds are managed by FMR, which handles their business affairs. FMR
Texas, located in Irving, Texas, has primary responsibility for providing
investment management services.
Fidelity investment personnel may invest in securities for their own
account pursuant to a code of ethics that establishes procedures for
personal investing and restricts certain transactions.
Fidelity Distributors Corporation (FDC) distributes and markets Fidelity's
funds and services. Fidelity Service Company,    Inc.     (FSC) performs
transfer agent servicing functions for each fund.
FMR Corp. is the ultimate parent company of FMR and FMR Texas. Members of
the Edward C. Johnson 3d family are the predominant owners of a class of
shares of common stock representing approximately 49% of the voting power
of FMR Corp. Under the Investment Company Act of 1940 (the 1940 Act),
control of a company is presumed where one individual or group of
individuals owns more than 25% of the voting stock of that company;
therefore, the Johnson family may be deemed under the 1940 Act to form a
controlling group with respect to FMR Corp.
A broker-dealer may use a portion of the commissions paid by the funds to
reduce custodian or transfer agent fees for those funds. FMR may use its
broker-dealer affiliates and other firms that sell fund shares to carry out
a fund's transactions, provided that the fund receives brokerage services
and commission rates comparable to those of other broker-dealers. 
INVESTMENT PRINCIPLES AND RISKS
EACH FUND'S INVESTMENT APPROACH
CASH RESERVES seeks to earn a high level of current income while
maintaining a stable $1.00 share price by investing in high-quality,
short-term securities. The fund invests only in high-quality U.S.
dollar-denominated money market securities of domestic and foreign issuers,
including U.S. Government securities and repurchase agreements. The fund
also may enter into reverse repurchase agreements. 
U.S. GOVERNMENT RESERVES seeks to earn a high level of current income while
maintaining a stable $1.00 share price by investing in high-quality,
short-term securities. The fund invests only in U.S. Government securities
and repurchase agreements for these securities. The fund also may enter
into reverse repurchase agreements. 
When you sell your shares, they should be worth the same amount as when you
bought them. Of course, there is no guarantee that the funds will maintain
a stable $1.00 share price. The funds follow industry-standard guidelines
on the quality   ,     maturity and diversification of their investments,
which are designed to help maintain a stable $1.00 share price. The funds
will purchase only high-quality securities that FMR believes present
minimal credit risks and will observe maturity restrictions on securities
they buy. In general, securities with longer maturities are more vulnerable
to price changes, although they may provide higher yields. It is possible
that a major change in interest rates or a default on the funds'
investments could cause their share prices (and the value of your
investment) to change.
Each fund earns income at current money market rates. They stress income,
preservation of capital, and liquidity, and do not seek the higher yields
or capital appreciation that more aggressive investments may provide. Each
fund's yield will vary from day to day and generally reflects current
short-term interest rates and other market conditions. 
It is important to note that neither the funds nor their yields are insured
or guaranteed by the U.S. Government.
SECURITIES AND INVESTMENT PRACTICES
The following pages contain more detailed information about types of
instruments in which a fund may invest, strategies FMR may employ in
pursuit of a fund's investment objective, and a summary of related risks.
Any restrictions listed supplement those discussed earlier in this section.
A complete listing of each fund's limitations and more detailed information
about each fund's investments are contained in a fund's SAI. Policies and
limitations are considered at the time of purchase; the sale of instruments
is not required in the event of a subsequent change in circumstances.
FMR may not buy all of these instruments or use all of these techniques
unless it believes that they are consistent with a fund's investment
objective and policies and that doing so will help a fund achieve its goal.
Fund holdings and recent investment strategies are detailed in each fund's
financial reports, which are sent to shareholders twice a year. For a free
SAI or financial report, call 1-800-544-8888.
MONEY MARKET SECURITIES are high-quality, short-term instruments issued by
the U.S. Government, corporations, financial institutions, and other
entities. These securities may carry fixed, variable, or floating interest
rates. Some money market securities employ a trust or similar structure to
modify the maturity, price characteristics, or quality of financial assets
so that they are eligible investments for money market funds. If the
structure does not perform as intended, adverse tax or investment
consequences may result. 
U.S. GOVERNMENT MONEY MARKET SECURITIES are short-term debt instruments
issued or guaranteed by the U.S. Treasury or by an agency or
instrumentality of the U.S. Government. Not all U.S. Government securities
are backed by the full faith and credit of the United States. For example,
U.S. Government securities such as those issued by the Federal National
Mortgage Association are supported by the instrumentality's right to borrow
money from the U.S. Treasury under certain circumstances. Other U.S.
Government securities such as those issued by the Federal Farm Credit Banks
Funding Corporation are supported only by the credit of the entity that
issued them.
U.S. TREASURY MONEY MARKET SECURITIES are short-term debt obligations
issued by the U.S. Treasury and include bills, notes, and bonds. U.S.
Treasury securities are backed by the full faith and credit of the United
States.
CREDIT    AND LIQUIDITY     SUPPORT. Issuers may employ various forms of
credit and liquidity enhancement, including    letters of credit,
guarantees, puts and demand features, and insurance provided by entities
such as banks, and other financial institutions. These arrangements expose
a fund to the credit risk of the entity providing the credit or liquidity
support. Changes in the credit quality of the provider could affect the
value of the security and a fund's share price.
    FOREIGN EXPOSURE.    Securities issued by foreign entities, including
foreign governments, corporations, and banks, and securities issued by U.S.
entities with substantial foreign operations may involve additional risks
and considerations. Likewise, securities for which foreign entities provide
credit or liquidity support may involve different risks than those
supported by domestic entities. Extensive public information about the
foreign entity may not be available, and unfavorable political, economic,
or governmental developments in the foreign country involved could affect
the repayment of principal or payment of interest.    
ASSET-BACKED SECURITIES include interests in pools of mortgages, loans,
receivables, or other assets. Payment of principal and interest may be
largely dependent upon the cash flows generated by the assets backing the
securities.
VARIABLE AND FLOATING RATE SECURITIES have interest rates that are
periodically adjusted either at specific intervals or whenever a benchmark
rate changes. These interest rate adjustments are designed to help
stabilize the security's price.
STRIPPED SECURITIES are the separate income or principal components of a
debt security. The risks associated with stripped securities are similar to
those of other money market securities, although stripped securities may be
more volatile. U.S. Treasury securities that have been stripped by a
Federal Reserve Bank are obligations issued by the U.S. Treasury.
REPURCHASE AGREEMENTS. In a repurchase agreement, a fund buys a security at
one price and simultaneously agrees to sell it back at a higher price.
Delays or losses could result if the other party to the agreement defaults
or becomes insolvent.
REVERSE REPURCHASE AGREEMENTS. In a reverse repurchase agreement, a fund
temporarily transfers possession of a portfolio instrument to another party
in return for cash. This could increase the risk of fluctuation in the
fund's yield or in the market value of its assets.
OTHER MONEY MARKET SECURITIES may include commercial paper, certificates of
deposit, bankers' acceptances, and time deposits.
PUT FEATURES entitle the holder to put (sell back) a security to the issuer
or another party. In exchange for this benefit, a fund may accept a lower
interest rate. The credit quality of the investment may be affected by the
creditworthiness of the put provider. Demand features, standby commitments,
and tender options are types of put features.
ILLIQUID AND RESTRICTED SECURITIES. Some investments may be determined by
FMR, under the supervision of the Board of Trustees, to be illiquid, which
means that they may be difficult to sell promptly at an acceptable price.
The sale of some illiquid securities and some other securities may be
subject to legal restrictions. Difficulty in selling securities may result
in a loss or may be costly to a fund. 
RESTRICTIONS: A fund may not purchase a security if, as a result, more than
10% of its assets would be invested in illiquid securities.
WHEN-ISSUED AND DELAYED-DELIVERY TRANSACTIONS are trading practices in
which payment and delivery for the securities take place at a future date.
The market value of a security could change during this period.
FINANCIAL SERVICES INDUSTRY. Companies in the financial services industry
are subject to various risks related to that industry, such as government
regulation, changes in interest rates, and exposure on loans, including
loans to foreign borrowers. If a fund invests substantially in this
industry, its performance may be affected by conditions affecting the
industry.
RESTRICTIONS: Cash Reserves will invest more than 25% of its total assets
in the financial services industry. 
       CASH MANAGEMENT.    A fund may invest in money market securities, in
repurchase agreements, and in a money market fund available only to funds
and accounts managed by FMR or its affiliates, whose goal is to seek a high
level of current income while maintaining a stable $1.00 share price. A
major change in interest rates or a default on the money market fund's
investments could cause its share price to change.
RESTRICTIONS: Each fund does not currently intend to invest in a money
market fund.    
DIVERSIFICATION. Diversifying a fund's investment portfolio can reduce the
risks of investing. This may include limiting the amount of money invested
in any one issuer or, on a broader scale, in any one industry. 
RESTRICTIONS: Cash Reserves may not invest more than 5% of its total assets
in any one issuer, except that the fund may invest up to 10% of its total
assets in certain    other money market funds and in     the highest
quality securities of a single issuer for up to three business days. This
limitation does not apply to U.S. Government securities.
BORROWING. Each fund may borrow from banks or from other funds advised by
FMR, or through reverse repurchase agreements, and may make additional
investments while borrowings are outstanding.
RESTRICTIONS: Each fund may borrow only for temporary or emergency
purposes, or engage in reverse repurchase agreements, but not in an amount
exceeding 331/3% of its total assets.
LENDING. A fund may lend money to other funds advised by FMR.
RESTRICTIONS: Loans, in the aggregate, may not exceed 331/3% of a fund's
total assets. U.S. Government Reserves does not lend money to other funds
advised by FMR.
FUNDAMENTAL INVESTMENT POLICIES AND RESTRICTIONS
Some of the policies and restrictions discussed on the preceding pages are
fundamental, that is, subject to change only by shareholder approval. The
following paragraphs restate all those that are fundamental. All policies
stated throughout this prospectus, other than those identified in the
following paragraphs, can be changed without shareholder approval. 
CASH RESERVES seeks as high a level of current income as is consistent with
preservation of capital and liquidity by investing in money market
instruments. The fund will invest more than 25% of its total assets in the
financial services industry.
U.S. GOVERNMENT RESERVES seeks as high a level of current income as is
consistent with the security of principal and liquidity.    The fund may
engage in repurchase agreements secured by obligations issued or guaranteed
as to principal and interest by the United States Government or by any of
its agencies or instrumentalities.    
Each fund may borrow only for temporary or emergency purposes, or engage in
reverse repurchase agreements, but not in an amount exceeding 331/3% of its
total assets.
Loans, in the aggregate, may not exceed 331/3% of a fund's total assets. 
BREAKDOWN OF EXPENSES 
Like all mutual funds, the funds pay fees related to their daily
operations. Expenses paid out of a fund's assets are reflected in its share
price or dividends; they are neither billed directly to shareholders nor
deducted from shareholder accounts. 
Each fund pays a MANAGEMENT FEE to FMR for managing its investments and
business affairs. FMR in turn pays fees to an affiliate who provides
assistance with these services. Each fund also pays OTHER EXPENSES, which
are explained on page .
FMR may, from time to time, agree to reimburse the funds for management
fees and other expenses above a specified limit. FMR retains the ability to
be repaid by a fund if expenses fall below the specified limit prior to the
end of the fiscal year. Reimbursement arrangements, which may be terminated
at any time without notice, can decrease a fund's expenses and boost its
performance.
MANAGEMENT FEE 
The management fee is calculated and paid to FMR every month.
Each fund's management fee is calculated by multiplying the sum of two
components by the fund's average net assets and adding an income-based fee.
One component, the group fee rate, is based on the average net assets of
all the mutual funds advised by FMR. This rate cannot rise above .37%, and
it drops as total assets under management increase. The other component,
the individual fund fee rate, is 0.03%. The income-based fee is 6% of the
fund's gross income in excess of 5% yield and cannot rise above .24% of the
fund's average net assets. 
   For November 1996, the group fee rate was .1429%. The total management
fee rate for the fiscal year ended November 30, 1996 was .21% for Cash
Reserves and .21% for U.S. Government Reserves.    
FMR HAS SUB-ADVISORY AGREEMENTS with FMR Texas, which has primary
responsibility for providing investment management for the funds, while FMR
retains responsibility for providing other management services. FMR pays
FMR Texas 50% of its management fee (before expense reimbursements) for
these    services. FMR paid FMR Texas .10% of Cash Reserves and .10% of
U.S. Government Reserves average net assets for the fiscal year ended
November 30, 1996.    
OTHER EXPENSES 
While the management fee is a significant component of the funds' annual
operating costs, the funds have other expenses as well. 
The funds contract with FSC to perform many transaction and accounting
functions. These services include processing shareholder transactions,
valuing each fund's investments, and handling securities loans. In fiscal
year    ended November 30, 1996, Cash Reserves and U.S. Government Reserves
paid FSC fees equal to .28% and .28%,     respectively, of average net
assets.
The funds also pay other expenses, such as legal, audit, and custodian
fees; proxy solicitation costs; and the compensation of trustees who are
not affiliated with Fidelity.
Each fund has adopted a Distribution and Service Plan. These plans
recognize that FMR may use its resources, including management fees, to pay
expenses associated with the sale of fund shares. This may include payments
to third parties, such as banks or broker-dealers, that provide shareholder
support services or engage in the sale of the fund's shares. It is
important to note, however, that the funds do not pay FMR any separate fees
for this service.
YOUR ACCOUNT
 
 
DOING BUSINESS WITH FIDELITY
Fidelity Investments was established in 1946 to manage one of America's
first mutual funds. Today, Fidelity is the largest mutual fund company in
the country, and is known as an innovative provider of high-quality
financial services to individuals and institutions.
In addition to its mutual fund business, the company operates one of
America's leading discount brokerage firms,    Fidelity Brokerage Services,
Inc.     (FBSI). Fidelity is also a leader in providing tax-sheltered
retirement plans for individuals investing on their own or through their
employer.
Fidelity is committed to providing investors with practical information to
make investment decisions. Based in Boston, Fidelity provides customers
with complete service 24 hours a day, 365 days a year, through a network of
telephone service centers around the country. 
To reach Fidelity for general information, call these numbers:
(small solid bullet) For mutual funds, 1-800-544-8888
(small solid bullet) For brokerage, 1-800-544-7272
If you would prefer to speak with a representative in person, Fidelity has
over 80 walk-in Investor Centers across the country.
TYPES OF ACCOUNTS
You may set up an account directly in a fund or, if you own or intend to
purchase individual securities as part of your total investment portfolio,
you may consider investing in a fund through a brokerage account.
You may purchase or sell shares of the funds through an investment
professional, including a broker, who may charge you a transaction fee for
this service. If you invest through FBSI, another financial institution, or
an investment professional, read their program materials for any special
provisions, additional service features or fees that may apply to your
investment in a fund. Certain features of the fund, such as the minimum
initial or subsequent investment amounts, may be modified.
The different ways to set up (register) your account with Fidelity are
listed in the table on page .
The account guidelines that follow may not apply to certain retirement
accounts. If you are investing through a retirement account or if your
employer offers the funds through a retirement program, you may be subject
to additional fees. For more information, please refer to your program
materials, contact your employer, or call your retirement benefits number
or Fidelity directly, as appropriate.
FIDELITY FACTS
Fidelity offers the broadest 
selection of mutual funds in 
the world.
(solid bullet) Number of Fidelity mutual 
funds: over    225    
(solid bullet) Assets in Fidelity mutual 
funds: over $   435     billion
(solid bullet) Number of shareholder 
accounts: over    29     million
(solid bullet) Number of investment 
analysts and portfolio 
managers: over    215    
(checkmark)
WAYS TO SET UP YOUR ACCOUNT
INDIVIDUAL OR JOINT TENANT
FOR YOUR GENERAL INVESTMENT NEEDS 
Individual accounts are owned by one person. Joint accounts can have two or
more owners (tenants).
RETIREMENT 
TO SHELTER YOUR RETIREMENT SAVINGS FROM TAXES 
 Retirement plans allow individuals to shelter investment income and
capital gains from current taxes. In addition, contributions to these
accounts may be tax deductible. Retirement accounts require special
applications and typically have lower minimums. 
(solid bullet) INDIVIDUAL RETIREMENT ACCOUNTS (IRAS) allow anyone of legal
age and under 70 with earned income to invest up to $2,000 per tax year.
Individuals can also invest in a spouse's IRA if the spouse has earned
income of less than $250.
(solid bullet) ROLLOVER IRAS retain special tax advantages for certain
distributions from employer-sponsored retirement plans. 
(solid bullet) KEOGH OR CORPORATE PROFIT SHARING AND MONEY PURCHASE PENSION
PLANS allow self-employed individuals or small business owners (and their
employees) to make tax-deductible contributions for themselves and any
eligible employees up to $30,000 per year. 
(solid bullet) SIMPLIFIED EMPLOYEE PENSION PLANS (SEP-IRAS) provide small
business owners or those with self-employed income (and their eligible
employees) with many of the same advantages as a Keogh, but with fewer
administrative requirements. 
(solid bullet) 403(B) CUSTODIAL ACCOUNTS are available to employees of most
tax-exempt institutions, including schools, hospitals, and other charitable
organizations. 
(solid bullet) 401(K) PROGRAMS allow employees of corporations of all sizes
to contribute a percentage of their wages on a tax-deferred basis. These
accounts need to be established by the trustee of the plan.
GIFTS OR TRANSFERS TO A MINOR (UGMA, UTMA) 
TO INVEST FOR A CHILD'S EDUCATION OR OTHER FUTURE NEEDS 
These custodial accounts provide a way to give money to a child and obtain
tax benefits. An individual can give up to $10,000 a year per child without
paying federal gift tax. Depending on state laws, you can set up a
custodial account under the Uniform Gifts to Minors Act (UGMA) or the
Uniform Transfers to Minors Act (UTMA).
TRUST 
FOR MONEY BEING INVESTED BY A TRUST 
The trust must be established before an account can be opened.
BUSINESS OR ORGANIZATION 
FOR INVESTMENT NEEDS OF CORPORATIONS, ASSOCIATIONS, PARTNERSHIPS, OR OTHER
GROUPS
Requires a special application.
HOW TO BUY SHARES
EACH FUND'S SHARE PRICE, called net asset value (NAV), is calculated every
business day. The funds are managed to keep share prices stable at $1.00.
Each fund's shares are sold without a sales charge.
Shares are purchased at the next share price calculated after your
investment is received and accepted. Share price is normally calculated at
4 p.m. Eastern time.
IF YOU ARE NEW TO FIDELITY, complete and sign an account application and
mail it along with your check. You may also open your account in person or
by wire as described on page . If there is no application accompanying this
prospectus, call 1-800-544-8888.
IF YOU ALREADY HAVE MONEY INVESTED IN A FIDELITY FUND, you can:
(small solid bullet) Mail in an application with a check, or
(small solid bullet) Open your account by exchanging from another Fidelity
fund.
IF YOU ARE INVESTING THROUGH A TAX-SHELTERED RETIREMENT PLAN, such as an
IRA, for the first time, you will need a special application. Retirement
investing also involves its own investment procedures. Call 1-800-544-8888
for more information and a retirement application.
If you buy shares by check or Fidelity Money Line(registered trademark),
and then sell those shares by any method other than by exchange to another
Fidelity fund, the payment may be delayed for up to seven business days to
ensure that your previous investment has cleared.
MINIMUM INVESTMENTS 
TO OPEN AN ACCOUNT  $2,500
   For Fidelity IRA, Rollover IRA, 
SEP-IRA and Keogh accounts      $500
TO ADD TO AN ACCOUNT  $250
   For Fidelity IRA, Rollover IRA, 
SEP-IRA and Keogh accounts     $250
Through regular investment plans* $100
   MINIMUM BALANCE     $2,000
   For Fidelity IRA, Rollover IRA, 
SEP-IRA and Keogh accounts     $500
*FOR MORE INFORMATION ABOUT REGULAR INVESTMENT PLANS, PLEASE REFER TO THE
"INVESTOR SERVICES,"SECTION ON PAGE . 
These minimums may vary for investments through Fidelity Portfolio Advisory
Services, a Fidelity College Savings Plan account, or a Fidelity Payroll
Deduction Program account in Cash Reserves.    There is no minimum account
balance or initial or subsequent investment minimums for certain retirement
accounts funded through salary reduction, or accounts opened with the
proceeds of distributions from such Fidelity retirement accounts. Refer to
the a    ppropriate program materials for details.
 
<TABLE>
<CAPTION>
<S>                                   <C>                                           <C>                                           
                                      TO OPEN AN ACCOUNT                            TO ADD TO AN ACCOUNT                          
 
Phone 1-800-544-777 (phone_graphic)   (small solid bullet) Exchange from another    (small solid bullet) Exchange from another    
                                      Fidelity fund account                         Fidelity fund account                         
                                      with the same                                 with the same                                 
                                      registration, including                       registration, including                       
                                      name, address, and                            name, address, and                            
                                      taxpayer ID number.                           taxpayer ID number.                           
                                                                                    (small solid bullet) Use Fidelity Money       
                                                                                    Line to transfer from                         
                                                                                    your bank account. Call                       
                                                                                    before your first use to                      
                                                                                    verify that this service                      
                                                                                    is in place on your                           
                                                                                    account. Maximum                              
                                                                                    Money Line: $50,000.                          
 
</TABLE>
 
 
<TABLE>
<CAPTION>
<S>                   <C>                                           <C>                                            
Mail (mail_graphic)   (small solid bullet) Complete and sign the    (small solid bullet) Make your check           
                      application. Make your                        payable to the complete                        
                      check payable to the                          name of the fund.                              
                      complete name of the                          Indicate your fund                             
                      fund of your choice.                          account number on                              
                      Mail to the address                           your check and mail to                         
                      indicated on the                              the address printed on                         
                      application.                                  your account statement.                        
                                                                    (small solid bullet) Exchange by mail: call    
                                                                    1-800-544-6666 for                             
                                                                    instructions.                                  
 
</TABLE>
 
 
<TABLE>
<CAPTION>
<S>                        <C>                                            <C>                                           
In Person (hand_graphic)   (small solid bullet) Bring your application    (small solid bullet) Bring your check to a    
                           and check to a Fidelity                        Fidelity Investor Center.                     
                           Investor Center. Call                          Call 1-800-544-9797 for                       
                           1-800-544-9797 for the                         the center nearest you.                       
                           center nearest you.                                                                          
 
</TABLE>
 
 
<TABLE>
<CAPTION>
<S>                   <C>                                             <C>                                       
Wire (wire_graphic)   (small solid bullet) Call 1-800-544-7777 to     (small solid bullet) Not available for    
                      set up your account                             retirement accounts.                      
                      and to arrange a wire                           (small solid bullet) Wire to:             
                      transaction. Not                                Bankers Trust                             
                      available for retirement                        Company,                                  
                      accounts.                                       Bank Routing                              
                      (small solid bullet) Wire within 24 hours to:   #021001033,                               
                      Bankers Trust                                   Account #00163053.                        
                      Company,                                        Specify the complete                      
                      Bank Routing                                    name of the fund and                      
                      #021001033,                                     include your account                      
                      Account #00163053.                              number and your                           
                      Specify the complete                            name.                                     
                      name of the fund and                                                                      
                      include your new                                                                          
                      account number and                                                                        
                      your name.                                                                                
 
</TABLE>
 
 
<TABLE>
<CAPTION>
<S>                                 <C>                                   <C>                                            
Automatically (automatic_graphic)   (small solid bullet) Not available.   (small solid bullet) Use Fidelity Automatic    
                                                                          Account Builder. Sign                          
                                                                          up for this service                            
                                                                          when opening your                              
                                                                          account, or call                               
                                                                          1-800-544-6666 to add                          
                                                                          it.                                            
 
</TABLE>
 
 
<TABLE>
<CAPTION>
<S>                                                                             <C>   <C>   
(tdd_graphic) TDD - Service for the Deaf and Hearing Impaired: 1-800-544-0118               
 
</TABLE>
 
HOW TO SELL SHARES 
You can arrange to take money out of your fund account at any time by
selling (redeeming) some or all of your shares. Your shares will be sold at
the next share price calculated after your order is received and accepted.
Share price is normally calculated at 4 p.m. Eastern time. 
TO SELL SHARES IN A NON-RETIREMENT ACCOUNT, you may use any of the methods
described on these two pages. 
TO SELL SHARES IN A FIDELITY RETIREMENT ACCOUNT, your request must be made
in writing, except for exchanges to other Fidelity funds, which can be
requested by phone or in writing. Call 1-800-544-6666 for a retirement
distribution form. 
IF YOU ARE SELLING SOME BUT NOT ALL OF YOUR SHARES,    leave at least
$2,000     worth of shares in the account to keep it open ($500 for
retirement accounts). 
TO SELL SHARES BY BANK WIRE OR FIDELITY MONEY LINE, you will need to sign
up for these services in advance. 
CERTAIN REQUESTS MUST INCLUDE A SIGNATURE GUARANTEE. It is designed to
protect you and Fidelity from fraud. Your request must be made in writing
and include a signature guarantee if any of the following situations apply: 
(small solid bullet) You wish to redeem more than $100,000 worth of shares, 
(small solid bullet) Your account registration has changed within the last
30 days,
(small solid bullet) The check is being mailed to a different address than
the one on your account (record address), 
(small solid bullet) The check is being made payable to someone other than
the account owner, or 
(small solid bullet) The redemption proceeds are being transferred to a
Fidelity account with a different registration. 
You should be able to obtain a signature guarantee from a bank, broker
(including Fidelity Investor Centers), dealer, credit union (if authorized
under state law), securities exchange or association, clearing agency, or
savings association. A notary public cannot provide a signature guarantee. 
SELLING SHARES IN WRITING 
Write a "letter of instruction" with: 
(small solid bullet) Your name, 
(small solid bullet) The fund's name, 
(small solid bullet) Your fund account number, 
(small solid bullet) The dollar amount or number of shares to be redeemed,
and 
(small solid bullet) Any other applicable requirements listed in the table
that follows. 
Unless otherwise instructed, Fidelity will send a check to the record
address. Deliver your letter to a Fidelity Investor Center, or mail it to: 
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602 
CHECKWRITING 
If you have a checkbook for your account, you may write an unlimited number
of checks. Do not, however, try to close out your account by check.
      ACCOUNT TYPE   SPECIAL REQUIREMENTS   
 
 
<TABLE>
<CAPTION>
<S>                                              <C>                   <C>                                                    
Phone 1-800-544-777 (phone_graphic)              All account types     (small solid bullet) Maximum check request:            
                                                 except retirement     $100,000.                                              
                                                                       (small solid bullet) For Money Line transfers to       
                                                 All account types     your bank account; minimum:                            
                                                                       $10; maximum: $100,000.                                
                                                                       (small solid bullet) You may exchange to other         
                                                                       Fidelity funds if both                                 
                                                                       accounts are registered with                           
                                                                       the same name(s), address,                             
                                                                       and taxpayer ID number.                                
 
Mail or in Person (mail_graphic)(hand_graphic)   Individual, Joint     (small solid bullet) The letter of instruction must    
                                                 Tenant,               be signed by all persons                               
                                                 Sole Proprietorship   required to sign for                                   
                                                 , UGMA, UTMA          transactions, exactly as their                         
                                                 Retirement account    names appear on the                                    
                                                                       account.                                               
                                                                       (small solid bullet) The account owner should          
                                                 Trust                 complete a retirement                                  
                                                                       distribution form. Call                                
                                                                       1-800-544-6666 to request                              
                                                                       one.                                                   
                                                 Business or           (small solid bullet) The trustee must sign the         
                                                 Organization          letter indicating capacity as                          
                                                                       trustee. If the trustee's name                         
                                                                       is not in the account                                  
                                                                       registration, provide a copy of                        
                                                                       the trust document certified                           
                                                 Executor,             within the last 60 days.                               
                                                 Administrator,        (small solid bullet) At least one person               
                                                 Conservator,          authorized by corporate                                
                                                 Guardian              resolution to act on the                               
                                                                       account must sign the letter.                          
                                                                       (small solid bullet) Include a corporate               
                                                                       resolution with corporate seal                         
                                                                       or a signature guarantee.                              
                                                                       (small solid bullet) Call 1-800-544-6666 for           
                                                                       instructions.                                          
 
</TABLE>
 
 
<TABLE>
<CAPTION>
<S>                   <C>                  <C>                                                   
Wire (wire_graphic)   All account types    (small solid bullet) You must sign up for the wire    
                      except retirement    feature before using it. To                           
                                           verify that it is in place, call                      
                                           1-800-544-6666. Minimum                               
                                           wire: $5,000.                                         
                                           (small solid bullet) Your wire redemption request     
                                           must be received and                                  
                                           accepted by Fidelity before 4                         
                                           p.m. Eastern time for money                           
                                           to be wired on the next                               
                                           business day.                                         
                                           (small solid bullet) There is a 5.00 fee for each     
                                           wire redemption, which will                           
                                           be deducted from the                                  
                                           redemption amount.                                    
 
</TABLE>
 
 
<TABLE>
<CAPTION>
<S>                     <C>                   <C>                                                  
Check (check_graphic)   All account types:    (small solid bullet) Minimum check: $500.            
                                              (small solid bullet) All account owners must sign    
                                              a signature card to receive a                        
                                              checkbook.                                           
 
</TABLE>
 
 
<TABLE>
<CAPTION>
<S>                                                                             <C>   <C>   
(tdd_graphic) TDD - Service for the Deaf and Hearing Impaired: 1-800-544-0118               
 
</TABLE>
 
INVESTOR SERVICES
Fidelity provides a variety of services to help you manage your account.
INFORMATION SERVICES
FIDELITY'S TELEPHONE REPRESENTATIVES are available 24 hours a day, 365 days
a year. Whenever you call, you can speak with someone equipped to provide
the information or service you need.
STATEMENTS AND REPORTS that Fidelity sends to you include the following:
(small solid bullet) Confirmation statements (after every transaction,
except reinvestments, that affects your account balance or your account
registration)
(small solid bullet) Account statements (quarterly)
(small solid bullet) Financial reports (every six months)
To reduce expenses, only one copy of most financial reports and
prospectuses will be mailed to your household, even if you have more than
one account in the fund. Call 1-800-544-6666 if you need copies of
financial reports, prospectuses, or historical account information.
TRANSACTION SERVICES 
EXCHANGE PRIVILEGE. You may sell your fund shares and buy shares of other
Fidelity funds by telephone or in writing.
Exchanges may have tax consequences for you. For details on policies and
restrictions governing exchanges, including circumstances under which a
shareholder's exchange privilege may be suspended or revoked, see page .
FIDELITY MONEY LINE(registered trademark) enables you to transfer money by
phone between your bank account and your fund account. Most transfers are
complete within three business days of your call.
REGULAR INVESTMENT PLANS
Fidelity offers services that let you transfer money into your fund
account, or between fund accounts, automatically. Certain restrictions
apply for retirement accounts. Call 1-800-544-6666 for more information.
FIDELITY AUTOMATIC ACCOUNT BUILDERSM
TO MOVE MONEY FROM YOUR BANK ACCOUNT TO A FIDELITY FUND
MINIMUM      $100                      
 
FREQUENCY    Monthly or quarterly      
 
SETTING UP   Complete the              
             appropriate section on    
             the fund application.     
             For existing accounts,    
             call 1-800-544-6666       
             for an application.       
 
DIRECT DEPOSIT 
TO SEND ALL OR A PORTION OF YOUR PAYCHECK OR GOVERNMENT CHECK TO A FIDELITY
FUND 
MINIMUM      $100                     
 
FREQUENCY    Every pay period         
 
SETTING UP   Check the                
             appropriate box on       
             the fund application,    
             or call                  
             1-800-544-6666 for       
             an authorization form.   
 
FIDELITY AUTOMATIC EXCHANGE SERVICE
TO MOVE MONEY FROM A FIDELITY MONEY MARKET FUND TO ANOTHER FIDELITY FUND 
MINIMUM      $100                     
 
FREQUENCY    Monthly, bimonthly,      
             quarterly, or annually   
 
SETTING UP   To establish, call       
             1-800-544-6666 after     
             both accounts are        
             opened.                  
 
SHAREHOLDER AND ACCOUNT POLICIES
 
 
DIVIDENDS, CAPITAL GAINS, AND TAXES 
Each fund distributes substantially all of its net investment income and
capital gains, if any, to shareholders each year. Income dividends are
declared daily and paid monthly. 
DISTRIBUTION OPTIONS 
When you open an account, specify on your application how you want to
receive your distributions. If the option you prefer is not listed on the
application, call 1-800-544-6666 for instructions. Each fund offers three
options: 
1. REINVESTMENT OPTION. Your dividend and capital gain distributions, if
any, will be automatically reinvested in additional shares of the fund. If
you do not indicate a choice on your application, you will be assigned this
option. 
2. CASH OPTION. You will be sent a check for your dividend and capital gain
distributions, if any. 
3. DIRECTED DIVIDENDS(registered trademark) OPTION. Your dividend and
capital gain distributions, if any, will be automatically invested in
another identically registered Fidelity fund.
FOR RETIREMENT ACCOUNTS, all distributions are automatically reinvested.
When you are over 59 years old, you can receive distributions in cash. 
Dividends will be reinvested at the fund's NAV on the last day of the
month. Capital gain distributions, if any, will be reinvested at the NAV as
of the record date of the distribution. The mailing of distribution checks
will begin within seven days.
UNDERSTANDING
DISTRIBUTIONS
As a fund shareholder, you 
are entitled to your share of 
the fund's net income and 
gains on its investments. A 
fund passes its earnings 
along to its investors as 
DISTRIBUTIONS.
Each fund earns interest from 
its investments. These are 
passed along as DIVIDEND 
DISTRIBUTIONS. The fund may 
realize capital gains if it sells 
securities for a higher price 
than it paid for them. These 
are passed along as CAPITAL 
GAIN DISTRIBUTIONS. Money 
market funds usually don't 
make capital gain 
distributions.
(checkmark)
TAXES 
As with any investment, you should consider how your investment in a fund
will be taxed. If your account is not a tax-deferred retirement account, be
aware of these tax implications. 
Distributions are subject to federal income tax, and may also be subject to
state or local taxes. If you live outside the United States, your
distributions could also be taxed by the country in which you reside. Your
distributions are taxable when they are paid, whether you take them in cash
or reinvest them. However, distributions declared in December and paid in
January are taxable as if they were paid on December 31. 
For federal tax purposes, each fund's income and short-term capital gain
distributions are taxed as dividends; long-term capital gain distributions,
if any, are taxed as long-term capital gains. Every January, Fidelity will
send you and the IRS a statement showing the taxable distributions paid to
you in the previous year.
Mutual fund dividends from U.S. Government securities are generally free
from state and local income taxes. However, particular states may limit
this benefit, and some types of securities, such as repurchase agreements
and some agency-backed securities, may not qualify for the benefit. In
addition, some states may impose intangible property taxes. You should
consult your own tax adviser for details and up-to-date information on the
tax laws in your state.
TRANSACTION DETAILS 
THE FUNDS ARE OPEN FOR BUSINESS each day the New York Stock Exchange (NYSE)
is open. Fidelity normally calculates each fund's NAV as of the close of
business of the NYSE, normally 4 p.m. Eastern time.
EACH FUND'S NAV is the value of a single share. The NAV is computed by
adding the value of the fund's investments, cash, and other assets,
subtracting its liabilities, and then dividing the result by the number of
shares outstanding. 
Like most money market funds, each fund values the securities it owns on
the basis of amortized cost. This method minimizes the effect of changes in
a security's market value and helps each fund to maintain a stable $1.00
share price.
EACH FUND'S OFFERING PRICE (price to buy one share) and REDEMPTION PRICE
(price to sell one share) are its NAV. 
WHEN YOU SIGN YOUR ACCOUNT APPLICATION, you will be asked to certify that
your Social Security or taxpayer identification number is correct and that
you are not subject to 31% backup withholding for failing to report income
to the IRS. If you violate IRS regulations, the IRS can require a fund to
withhold 31% of your taxable distributions and redemptions. 
YOU MAY INITIATE MANY TRANSACTIONS BY TELEPHONE. Fidelity may only be
liable for losses resulting from unauthorized transactions if it does not
follow reasonable procedures designed to verify the identity of the caller.
Fidelity will request personalized security codes or other information, and
may also record calls. You should verify the accuracy of your confirmation
statements immediately after you receive them. If you do not want the
ability to redeem and exchange by telephone, call Fidelity for
instructions.
IF YOU ARE UNABLE TO REACH FIDELITY BY PHONE (for example, during periods
of unusual market activity), consider placing your order by mail or by
visiting a Fidelity Investor Center. 
EACH FUND RESERVES THE RIGHT TO SUSPEND THE OFFERING OF SHARES for a period
of time. Each fund also reserves the right to reject any specific purchase
order, including certain purchases by exchange. See "Exchange Restrictions"
on page . Purchase orders may be refused if, in FMR's opinion, they would
disrupt management of a fund. 
WHEN YOU PLACE AN ORDER TO BUY SHARES, your order will be processed at the
next offering price calculated after your order is received and accepted.
Note the following: 
(small solid bullet) All of your purchases must be made in U.S. dollars and
checks must be drawn on U.S. banks. 
(small solid bullet) Fidelity does not accept cash. 
(small solid bullet) When making a purchase with more than one check, each
check must have a value of at least $50. 
(small solid bullet) Each fund reserves the right to limit the number of
checks processed at one time.
(small solid bullet) If your check does not clear, your purchase will be
cancelled and you could be liable for any losses or fees a fund or its
transfer agent has incurred. 
(small solid bullet) You begin to earn dividends as of the first business
day following the day of your purchase. 
TO AVOID THE COLLECTION PERIOD associated with check and Money Line
purchases, consider buying shares by bank wire, U.S. Postal money order,
U.S. Treasury check, Federal Reserve check, or direct deposit instead. 
WHEN YOU PLACE AN ORDER TO SELL SHARES, your shares will be sold at the
next NAV calculated after your request is received and accepted. Note the
following: 
(small solid bullet) Normally, redemption proceeds will be mailed to you on
the next business day, but if making immediate payment could adversely
affect a fund, it may take up to seven days to pay you. 
(small solid bullet) Shares will earn dividends through the date of
redemption; however, shares redeemed on a Friday or prior to a holiday will
continue to earn dividends until the next business day.
(small solid bullet) Fidelity Money Line redemptions generally will be
credited to your bank account on the second or third business day after
your phone call.
(small solid bullet) Each fund may hold payment on redemptions until it is
reasonably satisfied that investments made by check or Fidelity Money Line
have been collected, which can take up to seven business days.
(small solid bullet) Redemptions may be suspended or payment dates
postponed when the NYSE is closed (other than weekends or holidays), when
trading on the NYSE is restricted, or as permitted by the SEC.
(small solid bullet) If you sell shares by writing a check and the amount
of the check is greater than the value of your account, your check will be
returned to you and you may be subject to additional charges.
FIDELITY RESERVES THE RIGHT TO DEDUCT AN ANNUAL MAINTENANCE FEE of $12.00
from accounts with a value of less than $2,500, subject to an annual
   maximum charge of $24.00 per shar    eholder. It is expected that
accounts will be valued on the second Friday in November of each year.
Accounts opened after September 30 will not be subject to the fee for that
year. The fee, which is payable to the transfer agent, is designed to
offset in part the relatively higher costs of servicing    smaller
accounts. This fee will not be deducted from Fideity brokerage accounts,
retirement accounts (excep    t non-prototype retirement accounts),
accounts using regular investment    plans, or if total assets in Fidelity
exceed $30,000. Eligibility for the $30,000     waiver is determined by
aggregating    Fidelity accounts maintained by FSC or     FBSI which are
registered under the same social security number or which list the same
social security number for the custodian of a Uniform Gifts/Transfers to
Minors Act account.
IF YOUR ACCOUNT BALANCE FALLS BELOW    $2,000, you wi    ll be given 30
days' notice to reestablish the minimum balance. If you do not increase
your balance, Fidelity reserves the right to close your account and send
the proceeds to you. Your shares will be redeemed at the NAV on the day
your account is closed. 
FIDELITY MAY CHARGE A FEE FOR SPECIAL SERVICES, such as providing
historical account documents, that are beyond the normal scope of its
services. 
FDC may, at its own expense, provide promotional incentives to qualified
recipients who support the sale of shares of the funds without
reimbursement from the funds. Qualified recipients are securities dealers
who have sold fund shares or others, including banks and other financial
institutions, under special arrangements in connection with FDC's sales
activities. In some instances, these incentives may be offered only to
certain institutions whose representatives provide services in connection
with the sale or expected sale of significant amounts of shares.
EXCHANGE RESTRICTIONS
As a shareholder, you have the privilege of exchanging shares of a fund for
shares of other Fidelity funds. However, you should note the following:
(small solid bullet) The fund you are exchanging into must be available for
sale in your state.
(small solid bullet) You may only exchange between accounts that are
registered in the same name, address, and taxpayer identification number.
(small solid bullet) Before exchanging into a fund, read its prospectus.
(small solid bullet) If you exchange into a fund with a sales charge, you
pay the percentage-point difference between that fund's sales charge and
any sales charge you have previously paid in connection with the shares you
are exchanging. For example, if you had already paid a sales charge of 2%
on your shares and you exchange them into a fund with a 3% sales charge,
you would pay an additional 1% sales charge.
(small solid bullet) Exchanges may have tax consequences for you.
(small solid bullet) Each fund reserves the right to refuse exchange
purchases by any person or group if, in FMR's judgment, the fund would be
unable to invest the money effectively in accordance with its investment
objective and policies, or would otherwise potentially be adversely
affected.
(small solid bullet) Your exchanges may be restricted or refused if a fund
receives or anticipates simultaneous orders affecting significant portions
of the fund's assets. In particular, a pattern of exchanges that coincides
with a "market timing" strategy may be disruptive to a fund.
Although the funds will attempt to give you prior notice whenever they are
reasonably able to do so, they may impose these restrictions at any time.
The funds reserve the right to terminate or modify the exchange privilege
in the future. 
OTHER FUNDS MAY HAVE DIFFERENT EXCHANGE RESTRICTIONS, and may impose
administrative fees of up to $7.50 and redemption fees of up to 1.50% on
exchanges. Check each fund's prospectus for details.
 
 
 
 
 
 
 
This prospectus is printed on recycled paper using soy-based inks.
FIDELITY CASH RESERVES AND FIDELITY U.S. GOVERNMENT RESERVES 
FUNDS OF FIDELITY PHILLIPS STREET TRUST
STATEMENT OF ADDITIONAL INFORMATION
         JANUARY 18, 1997
This Statement is not a prospectus but should be read in conjunction with
the funds' current Prospectus (dated  January 18, 1997). Please retain this
document for future reference. The funds' financial statements and
financial highlights, included in the Annual Report for the fiscal year
ended         November 30, 1996, are incorporated herein by reference. To
obtain an additional copy of the Prospectus or the Annual Report, please
call Fidelity Distributors Corporation at 1-800-544-8888.
TABLE OF CONTENTS                                PAGE   
 
                                                        
 
Investment Policies and Limitations                     
 
Portfolio Transactions                                  
 
Valuation of Portfolio Securities                       
 
Performance                                             
 
Additional Purchase and Redemption Information          
 
Distributions and Taxes                                 
 
FMR                                                     
 
Trustees and Officers                                   
 
Management Contracts                                    
 
Distribution and Service Plans                          
 
Contracts with FMR Affiliates                           
 
Description of the Trust                                
 
Financial Statements                                    
 
Appendix                                                
 
INVESTMENT ADVISER
Fidelity Management & Research Company (FMR)
INVESTMENT SUB-ADVISER
FMR Texas Inc. (FMR Texas) 
DISTRIBUTOR
Fidelity Distributors Corporation (FDC)
TRANSFER AGENT 
   Fidelity Service Company, Inc.     (FSC)
       CAS/FUS   -ptb-    0197       
INVESTMENT POLICIES AND LIMITATIONS
The following policies and limitations supplement those set forth in the
Prospectus. Unless otherwise noted, whenever an investment policy or
limitation states a maximum percentage of a fund's assets that may be
invested in any security or other asset, or sets forth a policy regarding
quality standards, such standard or percentage limitation will be
determined immediately after and as a result of the fund's acquisition of
such security or other asset. Accordingly, any subsequent change in values,
net assets, or other circumstances will not be considered when determining
whether the investment complies with the fund's investment policies and
limitations.
The fund's fundamental investment policies and limitations cannot be
changed without approval by a "majority of the outstanding voting
securities" (as defined in the Investment Company Act of 1940) of the fund.
However, except for the fundamental investment limitations listed below,
the investment policies and limitations described in this Statement of
Additional Information are not fundamental and may be changed without
shareholder approval.
INVESTMENT LIMITATIONS OF FIDELITY CASH RESERVES
THE FOLLOWING ARE THE FUND'S FUNDAMENTAL INVESTMENT LIMITATIONS SET FORTH
IN THEIR ENTIRETY. THE FUND MAY NOT:
(1) purchase the securities of any issuer (other than obligations issued or
guaranteed as to principal and interest by the United States government,
its agencies or instrumentalities) if, as a result, more than 5% of its
total assets would be invested in the securities of such issuer, provided
however, that with respect to 25% of its total assets, 10% of its total
assets may be invested in the securities of any single issuer;
(2) issue senior securities, except as permitted under the Investment
Company Act of 1940;
(3) purchase securities on margin (but the fund may obtain such credits as
may be necessary for the clearance of purchases and sales of securities);
(4) borrow money, except that the fund may (i) borrow money for temporary
or emergency purposes (not for leveraging or investment) and (ii) engage in
reverse repurchase agreements for any purpose; provided that (i) and (ii)
in combination do not exceed 33 1/3% of the fund's total assets (including
the amount borrowed) less liabilities (other than borrowings). Any
borrowings that come to exceed this amount will be reduced within three
days (not including Sundays and holidays) to the extent necessary to comply
with the 33 1/3% limitation;
(5) act as an underwriter (except as it may be deemed such in a sale of
restricted securities);
(6) purchase the securities of any issuer (other than securities issued or
guaranteed by the U.S. government or any of its agencies or
instrumentalities) if, as a result, more than 25% of the fund's total
assets would be invested in the securities of companies whose principal
business activities in the same industry, except that the fund will invest
more than 25% of its total assets in the financial services industry;
(7) purchase or sell real estate unless acquired as a result of ownership
of securities or other instruments (but this shall not prevent the fund
from investing in securities or other instruments backed by real estate or
securities of companies engaged in the real estate business);
(8) buy or sell commodities or commodity (futures) contracts;
(9) lend any security or make any other loan if, as a result, more than 33
1/3% of its total assets would be lent to other parties, but this limit
does not apply to purchases of debt securities or to repurchase agreements;
(10) invest in oil, gas, or other mineral exploration or development
programs; or
(11) invest in companies for the purpose of exercising control or
management.
(12) The fund may, notwithstanding any other fundamental investment policy
or limitation, invest all of its assets in the securities of a single
open-end management investment company with substantially the same
fundamental investment objectives, policies, and limitations as the fund.
THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL, AND MAY BE
CHANGED WITHOUT SHAREHOLDER APPROVAL.
   (i) The fund does not currently intend to purchase a security (other
than securities issued or guaranteed by the U.S. government or any of its
agencies or instrumentalities) if, as a result, more than 5% of its total
assets would be invested in the securities of a single issuer; provided
that the fund may invest up to 10% of its total assets in the first tier
securities of a single issuer for up to three business days. (This limit
does not apply to investments of up to 10% of total assets in securities of
other open-end investment companies managed by FMR or a successor or
affiliate purchased pursuant to an exemptive order granted by the SEC.)    
(ii) The fund does not currently intend to sell securities short, unless it
owns or has the right to obtain securities equivalent in kind and amount to
the securities sold short, and provided that transactions in futures
contracts and options are not deemed to constitute selling securities
short.
(iii) The fund may borrow money only (a) from a bank or from a registered
investment company or portfolio for which FMR or an affiliate serves as
investment adviser or (b) by engaging in reverse repurchase agreements with
any party. The fund will not purchase any security while borrowings
(excluding reverse repurchase agreements) representing more than 5% of its
total assets are outstanding. The fund will not borrow from other funds
advised by FMR or its affiliates if total outstanding borrowings
immediately after such borrowing would exceed 15% of the fund's total
assets.
(iv) The fund does not currently intend to purchase any security if, as a
result, more than 10% of its net assets would be invested in securities
that are deemed to be illiquid because they are subject to legal or
contractual restrictions on resale or because they cannot be sold or
disposed of in the ordinary course of business at approximately the prices
at which they are valued.
(v) The fund does not currently intend to purchase or sell futures
contracts or call options. This limitation does not apply to options
attached to, or acquired or traded together with, their underlying
securities, and does not apply to securities that incorporate features
similar to options or futures contracts.
(vi) The fund does not currently intend to lend assets other than
securities to other parties, except by lending money (up to 10% of the
fund's net assets) to a registered investment company or portfolio for
which FMR or an affiliate serves as investment adviser. (This limitation
does not apply to purchases of debt securities or to repurchase
agreements.)
(vii) The fund does not currently intend to (a) purchase securities of
other investment companies, except in the open market where no commission
except the ordinary broker's commission is paid, or (b) purchase or retain
securities issued by other open-end invest   ment companies. Limitations
(a) and (b) do not apply (i) to securities received as dividends, through
offers of exchange, or as a result of a reorganization, consolidation, or
merger, or (ii) to securities of other open-end investment companies
managed by FMR or a successor or affiliate purchased pursuant to a
exemptive order granted by the SEC.    
(viii) The fund does not currently intend to purchase the securities of any
issuer (other than securities issued or guaranteed by domestic or foreign
governments or political subdivisions thereof) if, as a result, more than
5% of its total assets would be invested in the securities of business
enterprises that, including predecessors, have a record of less than three
years of continuous operations.
(ix) The fund does not currently intend to purchase the securities of any
issuer if those officers and Trustees of the trust and those officers and
directors of FMR who individually own more than 1/2 of 1% of the securities
of such issuer together own more than 5% of such issuer's securities.
(x) The fund does not currently intend to invest all of its assets in the
securities of a single open-end management investment company with
substantially the same fundamental investment objectives, policies, and
limitations as the fund.
For purposes of limitation (viii), pass-through entities and other special
purpose vehicles or pools of financial assets, such as issuers of
asset-backed securities or investment companies, are not considered
"business enterprises."
INVESTMENT LIMITATIONS OF FIDELITY U.S. GOVERNMENT RESERVES
THE FOLLOWING ARE THE FUND'S FUNDAMENTAL INVESTMENT LIMITATIONS SET FORTH
IN THEIR ENTIRETY. THE FUND MAY NOT:
(1) purchase the securities of any issuer (other than obligations issued or
guaranteed as to principal and interest by the government of the United
States, its agencies or instrumentalities) if, as a result, more than 5% of
its total assets would be invested in the securities of such issuer;
(2) issue senior securities, except as permitted under the Investment
Company Act of 1940;
(3) purchase securities on margin (but the fund may obtain such credits as
may be necessary for the clearance of purchases and sales of securities);
(4) borrow money, except that the fund may (i) borrow money for temporary
or emergency purposes (not for leveraging or investment) and (ii) engage in
reverse repurchase agreements for any purpose; provided that (i) and (ii)
in combination do not exceed 33 1/3% of the fund's total assets (including
the amount borrowed) less liabilities (other than borrowings). Any
borrowings that come to exceed this amount will be reduced within three
days (not including Sundays and holidays) to the extent necessary to comply
with the 33 1/3% limitation;
(5) act as an underwriter (except as it may be deemed such in a sale of
restricted securities);
(6) purchase the securities of any issuer (other than securities issued or
guaranteed by the U.S. government or any of its agencies or
instrumentalities) if, as a result, more than 25% of the fund's total
assets would be invested in the securities of companies whose principal
business activities are in the same industry;
(7) purchase or sell real estate unless acquired as a result of ownership
of securities or other instruments (but this shall not prevent the fund
from investing in securities or other instruments backed by real estate or
securities of companies engaged in the real estate business);
(8) buy or sell commodities or commodity (futures) contracts;
(9) lend any security or make any other loan if, as a result, more than 33
1/3% of its total assets would be lent to other parties, but this
limitation does not apply to purchases of debt securities or to repurchase
agreements;
(10) invest in oil, gas, or other mineral exploration or developmental
programs; or
(11) invest in companies for the purpose of exercising control or
management.
(12) The fund may, notwithstanding any other fundamental investment policy
or limitation, invest all of its assets in the securities of a single
open-end management investment company with substantially the same
fundamental investment objective, policies, and limitations as the fund.
THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL, AND MAY BE
CHANGED WITHOUT SHAREHOLDER APPROVAL.
(i) The fund does not currently intend to purchase the voting securities of
any issuer.
(ii) The fund does not currently intend to sell securities short, unless it
owns or has the right to obtain securities equivalent in kind and amount to
the securities sold short, and provided that transactions in futures
contracts and options are not deemed to constitute selling securities
short.
(iii) The fund may borrow money only (a) from a bank or from a registered
investment company or portfolio for which FMR or an affiliate serves as
investment adviser or (b) by engaging in reverse repurchase agreements with
any party. The fund will not purchase any security while borrowings
(excluding reverse repurchase agreements) representing more than 5% of its
total assets are outstanding. The fund will not borrow from other funds
advised by FMR or its affiliates if total outstanding borrowings
immediately after such borrowing would exceed 15% of the fund's total
assets.
(iv) The fund does not currently intend to purchase any security if, as a
result, more than 10% of its net assets would be invested in securities
that are deemed to be illiquid because they are subject to legal or
contractual restrictions on resale or because they cannot be sold or
disposed of in the ordinary course of business at approximately the prices
at which they are valued.
(v) The fund does not currently intend to purchase or sell futures
contracts or call options. This limitation does not apply to options
attached to, or acquired or traded together with, their underlying
securities, and does not apply to securities that incorporate features
similar to options or futures contracts.
(vi) The fund does not currently intend to make loans, but this limitation
does not apply to purchases of debt securities or to repurchase agreements.
(vii) The fund does not currently intend to (a) purchase securities of
other investment companies, except in the open market where no commission
except the ordinary broker's commission is paid, or (b) purchase or retain
securities issued by other open-end invest   ment companies. Limitations
(a) and (b) do not apply (i) to securities received as dividends, through
offers of exchange, or as a result of reorganization, consolidation, or
merger, or (ii) to securities of other open-end investment companies
managed by FMR or a successor or affiliate purchased pursuant to an
exemptive order granted by the SEC.    
(viii) The fund does not currently intend to purchase the securities of any
issuer (other than securities issued or guaranteed by domestic or foreign
governments or political subdivisions thereof) if, as a result, more than
5% of its total assets would be invested in the securities of business
enterprises that, including predecessors, have a record of less than three
years of continuous operation.
(ix) The fund does not currently intend to purchase the securities of any
issuer if those officers and Trustees of the trust and those officers and
directors of FMR who individually own more than 1/2 of 1% of the securities
of such issuer together own more than 5% of such issuer's securities.
(x) The fund does not currently intend to invest all of its assets in the
securities of a single open-end management investment company with
substantially the same fundamental investment objectives, policies, and
limitations as the fund.
For the funds' policies on quality and maturity, see the section entitled
"Quality and Maturity" on page        .
The following pages contain more detailed information about types of
instruments in which a fund may invest, strategies FMR may employ in
pursuit of a fund's investment objective, and a summary of related risks.
FMR may not buy all of these instruments or use all of these techniques
unless it believes that doing so will help the fund achieve its goal.
AFFILIATED BANK TRANSACTIONS. A fund may engage in transactions with
financial institutions that are, or may be considered to be, "affiliated
persons" of the fund under the Investment Company Act of 1940    (the 1940
Act)    . These transactions may include repurchase agreements with
custodian banks; short-term obligations of, and repurchase agreements with,
the 50 largest U.S. banks (measured by deposits); municipal securities;
U.S. Government securities with affiliated financial institutions that are
primary dealers in these securities; short-term currency transactions; and
short-term borrowings. In accordance with exemptive orders issued by the
Securities and Exchange Commission (SEC), the Board of Trustees has
established and periodically reviews procedures applicable to transactions
involving affiliated financial institutions.
ASSET-BACKED SECURITIES include pools of mortgages, loans, receivables or
other assets. Payment of principal and interest may be largely dependent
upon the cash flows generated by the assets backing the securities and, in
certain cases, supported by letters of credit, surety bonds, or other
credit enhancements. The value of asset-backed securities may also be
affected by the creditworthiness of the servicing agent for the pool, the
originator of the loans or receivables, or the entities providing the
credit support.
DELAYED-DELIVERY TRANSACTIONS. Each fund may buy and sell securities on a
delayed-delivery or when-issued basis. These transactions involve a
commitment by a fund to purchase or sell specific securities at a
predetermined price or yield, with payment and delivery taking place after
the customary settlement period for that type of security. Typically, no
interest accrues to the purchaser until the security is delivered.
When purchasing securities on a delayed-delivery basis, each fund assumes
the rights and risks of ownership, including the risk of price and yield
fluctuations. Because a fund is not required to pay for securities until
the delivery date, these risks are in addition to the risks associated with
the fund's other investments. If a fund remains substantially fully
invested at a time when delayed-delivery purchases are outstanding, the
delayed-delivery purchases may result in a form of leverage. When
delayed-delivery purchases are outstanding, the fund will set aside
appropriate liquid assets in a segregated custodial account to cover its
purchase obligations. When a fund has sold a security on a delayed-delivery
basis, the fund does not participate in further gains or losses with
respect to the security. If the other party to a delayed-delivery
transaction fails to deliver or pay for the securities, the fund could miss
a favorable price or yield opportunity, or could suffer a loss.
Each fund may renegotiate delayed-delivery transactions after they are
entered into, and may sell underlying securities before they are delivered,
which may result in capital gains or losses. 
DOMESTIC AND FOREIGN ISSUERS. Investments may be made in U.S.
dollar-denominated time deposits, certificates of deposit, and bankers'
acceptances of U.S. banks and their branches located outside of the United
States, U.S. branches and agencies of foreign banks, and foreign branches
of foreign banks. A fund may also invest in U.S. dollar-denominated
securities issued or guaranteed by other U.S. or foreign issuers, including
U.S. and foreign corporations or other business organizations, foreign
governments, foreign government agencies or instrumentalities, and U.S. and
foreign financial institutions, including savings and loan institutions,
insurance companies, mortgage bankers, and real estate investment trusts,
as well as banks. 
The obligations of foreign branches of U.S. banks may be general
obligations of the parent bank in addition to the issuing branch, or may be
limited by the terms of a specific obligation and by governmental
regulation. Payment of interest and principal on these obligations may also
be affected by governmental action in the country of domicile of the branch
(generally referred to as sovereign risk). In addition, evidence of
ownership of portfolio securities may be held outside of the United States
and a fund may be subject to the risks associated with the holding of such
property overseas. Various provisions of federal law governing the
establishment and operation of U.S. branches do not apply to foreign
branches of U.S. banks.
Obligations of U.S. branches and agencies of foreign banks may be general
obligations of the parent bank in addition to the issuing branch, or may be
limited by the terms of a specific obligation and by federal and state
regulation, as well as by governmental action in the country in which the
foreign bank has its head office.
Obligations of foreign issuers involve certain additional risks. These
risks may include future unfavorable political and economic developments,
withholding taxes, seizures of foreign deposits, currency controls,
interest limitations, or other governmental restrictions that might affect
payment of principal or interest, or the ability to honor a credit
commitment. Additionally, there may be less public information available
about foreign entities. Foreign issuers may be subject to less governmental
regulation and supervision than U.S. issuers. Foreign issuers also
generally are not bound by uniform accounting, auditing, and financial
reporting requirements comparable to those applicable to U.S. issuers.
ILLIQUID INVESTMENTS are investments that cannot be sold or disposed of in
the ordinary course of business at approximately the prices at which they
are valued. Under the supervision of the Board of Trustees, FMR determines
the liquidity of a fund's investments and, through reports from FMR, the
Board monitors investments in illiquid instruments. In determining the
liquidity of a fund's investments, FMR may consider various factors,
including (1) the frequency of trades and quotations, (2) the number of
dealers and prospective purchasers in the marketplace, (3) dealer
undertakings to make a market, (4) the nature of the security (including
any demand or tender features), and (5) the nature of the marketplace for
trades (including the ability to assign or offset the fund's rights and
obligations relating to the investment).
Investments currently considered by the funds to be illiquid include
repurchase agreements not entitling the holder to payment of principal and
interest within seven days. Also, FMR may determine some restricted
securities and time deposits to be illiquid.
In the absence of market quotations, illiquid investments are valued for
purposes of monitoring amortized cost valuation at fair value as determined
in good faith by a committee appointed by the Board of Trustees. If through
a change in values, net assets, or other circumstances, a fund were in a
position where more than 10% of its net assets was invested in illiquid
securities, it would seek to take appropriate steps to protect liquidity.
INTERFUND BORROWING AND LENDING PROGRAM. Pursuant to an exemptive order
issued by the SEC, each fund has received permission to lend money to, and
borrow money from, other funds advised by FMR or its affiliates. Fidelity
U.S. Government Reserves currently intends to participate in this program
only as a borrower. A fund will borrow through the program only when the
costs are equal to or lower than the costs to bank loans. Interfund loans
and borrowings normally extend overnight, but can have a maximum duration
of seven days. Loans may be called on one day's notice. A fund will lend
through the program only when the returns are higher than those available
from an investment in repurchase agreements. A fund may have to borrow from
a bank at a higher interest rate if an interfund loan is called or not
renewed. Any delay in repayment to a lending fund could result in a lost
investment opportunity or additional borrowing costs. 
MONEY MARKET SECURITIES are high-quality, short-term obligations. Some
money market securities employ a trust or other similar structure to modify
the maturity, price characteristics, or quality of financial assets. For
example, put features can be used to modify the maturity of a security or
interest rate adjustment features can be used to enhance price stability.
If the structure does not perform as intended, adverse tax or investment
consequences may result. Neither the Internal Revenue Service (IRS) nor any
other regulatory authority has ruled definitively on certain legal issues
presented by structured securities. Future tax or other regulatory
determinations could adversely affect the value, liquidity, or tax
treatment of the income received from these securities or the nature and
timing of distributions made by the funds. 
MUNICIPAL SECURITIES are issued to raise money for a variety of public or
private purposes, including general financing for state and local
governments, or financing for specific projects or public facilities. They
may be issued in anticipation of future revenues and may be backed by the
full taxing power of a municipality, the revenues from a specific project,
or the credit of a private organization. The value of some or all municipal
securities may be affected by uncertainties in the municipal market related
to legislation or litigation involving the taxation of municipal securities
or the rights of municipal securities holders. A fund may own a municipal
security directly or through a participation interest. 
PUT FEATURES entitle the holder to sell a security back to the issuer or a
third party at any time or at specified intervals. They are subject to the
risk that the put provider is unable to honor the put feature (purchase the
security). Put providers often support their ability to buy securities on
demand by obtaining letters of credit or other guarantees from other
entities. Demand features, standby commitments, and tender options are
types of put features.
QUALITY AND MATURITY. Pursuant to procedures adopted by the Board of
Trustees, the funds may purchase only high-quality securities that FMR
believes present minimal credit risks. To be considered high-quality, a
security must be rated in accordance with applicable rules in one of the
two highest categories for short-term securities by at least two nationally
recognized rating services (or by one, if only one rating service has rated
the security); or, if unrated, judged to be of equivalent quality by FMR.
High-quality securities are divided into "first tier" and "second tier"
securities. First tier securities are those deemed to be in the highest
rating category (e.g., Standard & Poor's A-1), and second tier securities
are those deemed to be in the second highest rating category (e.g.,
Standard & Poor's A-2). Split-rated securities may be determined to be
either first tier or second tier based on applicable regulations.
A fund may not invest more than 5% of its total assets in second tier
securities. In addition, a fund may not invest more than 1% of its total
assets or $1 million (whichever is greater) in the second tier securities
of a single issuer.
A fund currently intends to limit its investments to securities with
remaining maturities of 397 days or less, and to maintain a dollar-weighted
average maturity of 90 days or less. When determining the maturity of a
security, a fund may look to an interest rate reset or demand feature.
REPURCHASE AGREEMENTS. In a repurchase agreement, a fund purchases a
security and simultaneously commits to sell that security back to the
original seller at an agreed-upon price. The resale price reflects the
purchase price plus an agreed-upon incremental amount which is unrelated to
the coupon rate or maturity of the purchased security. To protect the fund
from the risk that the original seller will not fulfill its obligation, the
securities are held in an account of the fund at a bank, marked-to-market
daily, and maintained at a value at least equal to the sale price plus the
accrued incremental amount. While it does not presently appear possible to
eliminate all risks from these transactions (particularly the possibility
that the value of the underlying security will be less than the resale
price, as well as delays and costs to a fund in connection with bankruptcy
proceedings), it is each fund's current policy to engage in repurchase
agreement transactions with parties whose creditworthiness has been
reviewed and found satisfactory by FMR.
RESTRICTED SECURITIES generally can be sold in privately negotiated
transactions, pursuant to an exemption from registration under the
Securities Act of 1933, or in a registered public offering. Where
registration is required, a fund may be obligated to pay all or part of the
registration expense and a considerable period may elapse between the time
it decides to seek registration and the time it may be permitted to sell a
security under an effective registration statement. If, during such a
period, adverse market conditions were to develop, a fund might obtain a
less favorable price than prevailed when it decided to seek registration of
the security. However, in general, each fund anticipates holding restricted
securities to maturity or selling them in an exempt transaction.
REVERSE REPURCHASE AGREEMENTS. In a reverse repurchase agreement, a fund
sells a portfolio instrument to another party, such as a bank or
broker-dealer, in return for cash and agrees to repurchase the instrument
at a particular price and time. While a reverse repurchase agreement is
outstanding, the fund will maintain appropriate liquid assets in a
segregated custodial account to cover its obligation under the agreement. A
fund will enter into reverse repurchase agreements only with parties whose
creditworthiness has been found satisfactory by FMR. Such transactions may
increase fluctuations in the market value of the fund's assets and may be
viewed as a form of leverage.
SHORT SALES "AGAINST THE BOX." A fund may sell securities short when it
owns or has the right to obtain securities equivalent in kind or amount to
the securities sold short. Short sales could be used to protect the net
asset value per share of the fund in anticipation of increased interest
rates, without sacrificing the current yield of the securities sold short.
If a fund enters into a short sale against the box, it will be required to
set aside securities equivalent in kind and amount to the securities sold
short (or securities convertible or exchangeable into such securities) and
will be required to hold such securities while the short sale is
outstanding. The fund will incur transaction costs, including interest
expenses, in connection with opening, maintaining, and closing short sales
against the box.
SOURCES OF CREDIT OR LIQUIDITY SUPPORT. FMR may rely on its evaluation of
the credit of a bank or another entity in determining whether to purchase a
security supported by a letter of credit guarantee,    put or demand
feature,     insurance or other source of credit or liquidity. In
evaluating the credit of a foreign bank or other foreign entities, FMR will
consider whether adequate public information about the entity is available
and whether the entity may be subject to unfavorable political or economic
developments, currency controls, or other government restrictions that
might affect its ability to honor its commitment.
STRIPPED GOVERNMENT SECURITIES. Stripped government securities are created
by separating the income and principal components of a U.S. Government
security and selling them separately. STRIPS (Separate Trading of
Registered Interest and Principal of Securities) are created when the
coupon payments and the principal payment are stripped from an outstanding
U.S. Treasury security by a Federal Reserve Bank.
Privately stripped government securities are created when a dealer deposits
a U.S. Treasury security or other U.S. Government security with a custodian
for safekeeping. The custodian issues separate receipts for the coupon
payments and the principal payment, which the dealer then sells.
Proprietary receipts, such as Certificates of Accrual on Treasury
Securities (CATS) and Treasury Investment Growth Receipts (TIGRS), and
generic receipts, such as Treasury Receipts (TRs), are privately stripped
U.S. Treasury securities.
Because the SEC does not consider privately stripped government securities
to be U.S. Government securities for purposes of Rule 2a-7, a fund must
evaluate them as it would non-government securities pursuant to regulatory
guidelines applicable to all money market funds.
VARIABLE AND FLOATING RATE SECURITIES provide for periodic adjustments of
the interest rate paid on the security. Variable rate securities provide
for a specified periodic adjustment in the interest rate, while floating
rate securities have interest rates that change whenever there is a change
in a designated benchmark rate. Some variable or floating rate securities
have put features.
PORTFOLIO TRANSACTIONS
All orders for the purchase or sale of portfolio securities are placed on
behalf of each fund by FMR pursuant to authority contained in the
management contract. FMR has granted investment management authority to the
sub-adviser (see the section entitled "Management Contracts"), and the
sub-adviser is authorized to place orders for the purchase and sale of
portfolio securities, and will do so in accordance with the policies
described below. FMR is also responsible for the placement of transaction
orders for other investment companies and accounts for which it or its
affiliates act as investment adviser. Securities purchased and sold by a
fund generally will be traded on a net basis (i.e., without commission). In
selecting broker-dealers, subject to applicable limitations of the federal
securities laws, FMR considers various relevant factors, including, but not
limited to, the size and type of the transaction; the nature and character
of the markets for the security to be purchased or sold; the execution
efficiency, settlement capability, and financial condition of the
broker-dealer firm; the broker-dealer's execution services rendered on a
continuing basis; and the reasonableness of any commissions. 
The funds may execute portfolio transactions with broker-dealers who
provide research and execution services to the funds or other accounts over
which FMR or its affiliates exercise investment discretion. Such services
may include advice concerning the value of securities; the advisability of
investing in, purchasing, or selling securities; and the availability of
securities or the purchasers or sellers of securities. In addition, such
broker-dealers may furnish analyses and reports concerning issuers,
industries, securities, economic factors and trends, portfolio strategy,
and performance of accounts; effect securities transactions, and perform
functions incidental thereto (such as clearance and settlement). FMR
maintains a listing of broker-dealers who provide such services on a
regular basis. However, as many transactions on behalf of the funds are
placed with broker-dealers (including broker-dealers on the list) without
regard to the furnishing of such services, it is not possible to estimate
the proportion of such transactions directed to such broker-dealers solely
because such services were provided. The selection of such broker-dealers
generally is made by FMR (to the extent possible consistent with execution
considerations) based upon the quality of research and execution services
provided.
The receipt of research from broker-dealers that execute transactions on
behalf of the funds may be useful to FMR in rendering investment management
services to the funds or its other clients, and conversely, such research
provided by broker-dealers who have executed transaction orders on behalf
of other FMR clients may be useful to FMR in carrying out its obligations
to the funds. The receipt of such research has not reduced FMR's normal
independent research activities; however, it enables FMR to avoid the
additional expenses that could be incurred if FMR tried to develop
comparable information through its own efforts.
Subject to applicable limitations of the federal securities laws,
broker-dealers may receive commissions for agency transactions that are in
excess of the amount of commissions charged by other broker-dealers in
recognition of their research and execution services. In order to cause
each fund to pay such higher commissions, FMR must determine in good faith
that such commissions are reasonable in relation to the value of the
brokerage and research services provided by such executing broker-dealers,
viewed in terms of a particular transaction or FMR's overall
responsibilities to the funds and its other clients. In reaching this
determination, FMR will not attempt to place a specific dollar value on the
brokerage and research services provided, or to determine what portion of
the compensation should be related to those services.
FMR is authorized to use research services provided by and to place
portfolio transactions with brokerage firms that have provided assistance
in the distribution of shares of the funds or shares of other Fidelity
funds to the extent permitted by law. FMR may use research services
provided by and place agency transactions with Fidelity Brokerage Services,
Inc. (FBSI) and Fidelity Brokerage Services (FBS), subsidiaries of FMR
Corp., if the commissions are fair, reasonable, and comparable to
commissions charged by non-affiliated, qualified brokerage firms for
similar services. From September 1992 through December 1994, FBS operated
under the name Fidelity Brokerage Services Limited, Inc. (FBSL). As of
January 1995, FBSL was converted to an unlimited liability company and
assumed the name FBS. Prior to September 4, 1992, FBSL operated under the
name Fidelity Portfolio Services, Ltd. (FPSL) as a wholly owned subsidiary
of Fidelity International Limited (FIL). Edward C. Johnson 3d is Chairman
of FIL. Mr. Johnson 3d, Johnson family members, and various trusts for the
benefit of the Johnson family own, directly or indirectly, more than 25% of
the voting common stock of FIL.
Section 11(a) of the Securities Exchange Act of 1934 prohibits members of
national securities exchanges from executing exchange transactions for
accounts which they or their affiliates manage, unless certain requirements
are satisfied. Pursuant to such requirements, the Board of Trustees has
authorized FBSI to execute portfolio transactions on national securities
exchanges in accordance with approved procedures and applicable SEC rules.
Each fund's Trustees periodically review FMR's performance of its
responsibilities in connection with the placement of portfolio transactions
on behalf of the funds and review the commissions paid by each fund over
representative periods of time to determine if they are reasonable in
relation to the benefits to the fund.
   During the fiscal years ended November 30, 1996, 1995, and 1994, the
funds paid no brokerage commissions.    
From time to time the Trustees will review whether the recapture for the
benefit of the funds of some portion of the brokerage commissions or
similar fees paid by the funds on portfolio transactions is legally
permissible and advisable. Each fund seeks to recapture soliciting
broker-dealer fees on the tender of portfolio securities, but at present no
other recapture arrangements are in effect. The Trustees intend to continue
to review whether recapture opportunities are available and are legally
permissible and, if so, to determine in the exercise of their business
judgment whether it would be advisable for each fund to seek such
recapture.
Although the Trustees and officers of each fund are substantially the same
as those of other funds managed by FMR, investment decisions for each fund
are made independently from those of other funds managed by FMR or accounts
managed by FMR affiliates. It sometimes happens that the same security is
held in the portfolio of more than one of these funds or accounts.
Simultaneous transactions are inevitable when several funds and accounts
are managed by the same investment adviser, particularly when the same
security is suitable for the investment objective of more than one fund or
account.
When two or more funds are simultaneously engaged in the purchase or sale
of the same security, the prices and amounts are allocated in accordance
with procedures believed to be appropriate and equitable for each fund. In
some cases this system could have a detrimental effect on the price or
value of the security as far as each fund is concerned. In other cases,
however, the ability of the funds to participate in volume transactions
will produce better executions and prices for the funds. It is the current
opinion of the Trustees that the desirability of retaining FMR as
investment adviser to each fund outweighs any disadvantages that may be
said to exist from exposure to simultaneous transactions.
VALUATION OF PORTFOLIO SECURITIES
   FSC normally determines a fund's NAV at 4 p.m. Eastern time. The
valuation of portfolio securities is determined as of this time for the
purpose of computing each fund's NAV.
Portfolio securities and other assets are valued on the basis of amortized
cost. This technique involves initially valuing an instrument at its cost
as adjusted for amortization of premium or accretion of discount rather
than its current market value. The amortized cost value of an instrument
may be higher or lower than the price a fund would receive if it sold the
instrument.
During periods of declining interest rates, a fund's yield based on
amortized cost valuation may be higher than would result if the fund used
market valuations to determine its NAV. The converse would apply during
periods of rising interest rates.
Valuing each fund's investments on the basis of amortized cost and use of
the term "money market fund" are permitted pursuant to Rule 2a-7 under the
1940 Act. Each fund must adhere to certain conditions under Rule 2a-7, as
summarized in the section entitled "Quality and Maturity" on page .
The Board of Trustees oversees FMR's adherence to the provisions of Rule
2a-7 and has established procedures designed to stabilize each fund's NAV
at $1.00. At such intervals as they deem appropriate, the Trustees consider
the extent to which NAV calculated by using market valuations would deviate
from $1.00 per share. If the Trustees believe that a deviation from a
fund's amortized cost per share may result in material dilution or other
unfair results to shareholders, the Trustees have agreed to take such
corrective action, if any, as they deem appropriate to eliminate or reduce,
to the extent reasonably practicable, the dilution or unfair results. Such
corrective action could include selling portfolio instruments prior to
maturity to realize capital gains or losses or to shorten average portfolio
maturity; withholding dividends; redeeming shares in kind; establishing NAV
by using available market quotations; and such other measures as the
Trustees may deem appropriate.    
PERFORMANCE
The funds may quote performance in various ways. All performance
information supplied by the funds in advertising is historical and is not
intended to indicate future returns. Each fund's yield and total return
fluctuate in response to market conditions and other factors.
YIELD CALCULATIONS. To compute a fund's yield for a period, the net change
in value of a hypothetical account containing one share reflects the value
of additional shares purchased with dividends from the one original share
and dividends declared on both the original share and any additional
shares. The net change is then divided by the value of the account at the
beginning of the period to obtain a base period return. This base period
return is annualized to obtain a current annualized yield. A fund also may
calculate an effective yield by compounding the base period return over a
one-year period. In addition to the current yield, the funds may quote
yields in advertising based on any historical seven-day period. Yields for
the funds are calculated on the same basis as other money market funds, as
required by applicable regulations.
Yield information may be useful in reviewing a fund's performance and in
providing a basis for comparison with other investment alternatives.
However, each fund's yield fluctuates, unlike investments that pay a fixed
interest rate over a stated period of time. When comparing investment
alternatives, investors should also note the quality and maturity of the
portfolio securities of respective investment companies they have chosen to
consider.
Investors should recognize that in periods of declining interest rates a
fund's yield will tend to be somewhat higher than prevailing market rates,
and in periods of rising interest rates the fund's yield will tend to be
somewhat lower. Also, when interest rates are falling, the inflow of net
new money to a fund from the continuous sale of its shares will likely be
invested in instruments producing lower yields than the balance of the
fund's holdings, thereby reducing the fund's current yield. In periods of
rising interest rates, the opposite can be expected to occur.
TOTAL RETURN CALCULATIONS. Total returns quoted in advertising reflect all
aspects of a fund's return, including the effect of reinvesting dividends
and capital gain distributions, and any change in the fund's NAV over a
stated period. Average annual total returns are calculated by determining
the growth or decline in value of a hypothetical historical investment in a
fund over a stated period, and then calculating the annually compounded
percentage rate that would have produced the same result if the rate of
growth or decline in value had been constant over the period. For example,
a cumulative total return of 100% over ten years would produce an average
annual total return of 7.18%, which is the steady annual rate of return
that would equal 100% growth on a compounded basis in ten years. While
average annual total returns are a convenient means of comparing investment
alternatives, investors should realize that a fund's performance is not
constant over time, but changes from year to year, and that average annual
total returns represent averaged figures as opposed to the actual
year-to-year performance of the fund.
In addition to average annual total returns, a fund may quote unaveraged or
cumulative total returns reflecting the simple change in value of an
investment over a stated period. Average annual and cumulative total
returns may be quoted as a percentage or as a dollar amount, and may be
calculated for a single investment, a series of investments, or a series of
redemptions, over any time period. Total returns may be broken down into
their components of income and capital (including capital gains and changes
in share price) in order to illustrate the relationship of these factors
and their contributions to total return. Total returns may be quoted on a
before-tax or after-tax basis. Total returns, yields, and other performance
information may be quoted numerically or in a table, graph, or similar
illustration.
HISTORICAL FUND RESULTS. The following table shows each fund's 7-day yield
and total returns for the period ended November 30,    1996.    
 
 
<TABLE>
<CAPTION>
<S>               <C>             <C>             <C>             <C>             <C>             <C>              <C>              
                  Average Annual Total Returns               Cumulative Total Returns               
 
                  Seven-Day       One             Five            Ten             One             Five             Ten              
                  Yield           Year            Years           Years           Year            Years            Years            
 
                                                                                                                              
 
   Fidelity     
Cash Reserves         5.00    %       5.18    %       4.29    %       5.78    %       5.18    %       23.35    %       75.37    %   
 
   Fidelity     
U.S. Government       4.93    %       5.12    %       4.10    %       5.56    %       5.12    %       22.25    %       71.78    %   
Reserves                                                                                                                     
 
</TABLE>
 
   Note: If FMR had not reimbursed certain fund expenses during these
periods, Fidelity U.S. Government Reserves' returns would have been lower.
The following table shows the income and capital elements of each fund's
cumulative total return. The table compares each fund's return to the
record of the Standard & Poor's 500 Index (S&P 500), the Dow Jones
Industrial Average (DJIA), and the cost of living, as measured by the
Consumer Price Index (CPI), over the same period. The CPI information is as
of the month end closest to the initial investment date for each fund. The
S&P 500 and DJIA comparisons are provided to show how each fund's total
return compared to the record of a broad unmanaged index of common stocks
and a narrower set of stocks of major industrial companies, respectively,
over the same period. Because each fund invests in short-term fixed-income
securities, common stocks represent a different type of investment from the
funds. Common stocks generally offer greater growth potential than the
funds, but generally experience greater price volatility, which means
greater potential for loss. In addition, common stocks generally provide
lower income than fixed-income investments such as the funds. The S&P 500
and DJIA returns are based on the prices of unmanaged groups of stocks and,
unlike the funds' returns, do not include the effect of brokerage
commissions or other costs of investing.
The following tables show the growth in value of a hypothetical $10,000
investment in each fund during the 10-year period ended November 30, 1996,
assuming all distributions were reinvested. The figures below reflect the
fluctuating interest rates of the specified periods and should not be
considered representative of the dividend income or capital gain or loss
that could be realized from an investment in a fund today. Tax consequences
of different investments have not been factored into the figures below.    
<TABLE>
<CAPTION>
<S>          <C>              <C>              <C>          <C>               <C>               <C>               <C>               
FIDELITY CASH RESERVES                                             INDICES               
 
Year          Value of        Value of         Value of      Total            S&P 500            DJIA              Cost of   
Ended         Initial         Reinvested       Reinvested    Value                                                 Living    
November 30   $10,000         Dividend         Capital Gain                                       
              Investment      Distributions    Distributions                                      
 
                                                                                              
 
                                                                                              
 
                                                                                              
   1996         $10,000          $ 7,537          $ 0          $ 17,537          $ 41,258          $ 46,330          $ 14,366       
 
   1995         $10,000          $ 6,673          $ 0          $ 16,673          $ 32,268          $ 35,282          $ 13,913       
 
   1994         $10,000          $ 5,779          $ 0          $ 15,779          $ 23,557          $ 25,366          $ 13,578       
 
   1993         $10,000          $ 5,210          $ 0          $ 15,210          $ 23,313          $ 24,318          $ 13,207       
 
   1992         $10,000          $ 4,772          $ 0          $ 14,772          $ 21,174          $ 21,201          $ 12,862       
 
   1991         $10,000          $ 4,218          $ 0          $ 14,218          $ 17,869          $ 18,029          $ 12,482       
 
   1990         $10,000          $ 3,385          $ 0          $ 13,385          $ 14,846          $ 15,414          $ 12,120       
 
   1989         $10,000          $ 2,408          $ 0          $ 12,408          $ 15,382          $ 15,676          $ 11,404       
 
   1988         $10,000          $ 1,389          $ 0          $ 11,389          $ 11,756          $ 11,803          $ 10,897       
 
   1987         $10,000          $ 628            $ 0          $ 10,628          $ 9,532           $ 9,874           $ 10,453       
 
</TABLE>
 
Explanatory Notes: With an initial investment of $10,000 in Fidelity Cash
Reserves on November 30, 1986, the net amount invested in Fidelity Cash
Reserves shares was $10,000. The cost of the initial investment ($10,000)
together with the aggregate cost of reinvested dividends and capital gain
distributions for the period covered (their cash value at the time they
were reinvested) amounted to $   17,537    . If distributions had not been
reinvested, the amount of distributions earned from the fund over time
would have been smaller, and cash payments for the period would have
amounted to $   5,632     for dividends. The fund did not distribute any
capital gains during the period.
 
 
 
<TABLE>
<CAPTION>
<S>       <C>              <C>              <C>             <C>               <C>               <C>               <C>               
FIDELITY U.S. GOVERNMENT RESERVES                                             INDICES               
 
Year      Value of         Value of         Value of        Total             S&P 500           DJIA              Cost of           
Ended     Initial          Reinvested       Reinvested      Value                                                 Living            
November 
30        $10,000          Dividend         Capital Gain                                                                            
          Investment       Distributions    Distributions                                                                           
 
                                                                                                                                    
 
                                                                                                                                    
 
                                                                                                                                    
 
   1996        $10,000        $ 7,178          $ 0             $ 17,178          $ 41,258          $ 46,330          $ 14,366       
 
   1995        $10,000        $ 6,341          $ 0             $ 16,341          $ 32,268          $ 35,282          $ 13,913       
 
   1994        $10,000        $ 5,475          $ 0             $ 15,475          $ 23,557          $ 25,366          $ 13,578       
 
   1993        $10,000        $ 4,932          $ 0             $ 14,932          $ 23,313          $ 24,318          $ 13,207       
 
   1992        $10,000        $ 4,553          $ 0             $ 14,553          $ 21,174          $ 21,201          $ 12,862       
 
   1991        $10,000        $ 4,052          $ 0             $ 14,052          $ 17,869          $ 18,029          $ 12,482       
 
   1990        $10,000        $ 3,273          $ 0             $ 13,273          $ 14,846          $ 15,414          $ 12,120       
 
   1989        $10,000        $ 2,317          $ 0             $ 12,317          $ 15,382          $ 15,676          $ 11,404       
 
   1988        $10,000        $ 1,327          $ 0             $ 11,327          $ 11,756          $ 11,803          $ 10,897       
 
   1987        $10,000        $ 594            $ 0             $ 10,594          $ 9,532           $ 9,874           $ 10,453       
 
</TABLE>
 
EXPLANATORY NOTES: With an initial investment of $10,000 in Fidelity U.S.
Government Reserves on November 30, 1986, the net amount invested in
Fidelity U.S. Government Reserves shares was $10,000. The cost of the
initial investment ($10,000   )     together with the aggregate cost of
reinvested dividends and capital gain distributions for the period covered
(their cash value at the time they were reinvested) amounted to
$   17,178    . If distributions had not been reinvested, the amount of
distributions earned from the fund over time would have been smaller, and
cash payments for the period would have amounted to $   5,424     for
dividends. The fund did not distribute any capital gains during the period.
PERFORMANCE COMPARISONS. A fund's performance may be compared to the
performance of other mutual funds in general, or to the performance of
particular types of mutual funds. These comparisons may be expressed as
mutual fund rankings prepared by Lipper Analytical Services, Inc. (Lipper),
an independent service located in Summit, New Jersey that monitors the
performance of mutual funds. Generally, Lipper rankings are based on total
return, assume reinvestment of distributions, do not take sales charges or
redemption fees into consideration, and are prepared without regard to tax
consequences. Lipper may also rank funds based on yield. In addition to the
mutual fund rankings, a fund's performance may be compared to stock, bond,
and money market mutual fund performance indices prepared by Lipper or
other organizations. When comparing these indices, it is important to
remember the risk and return characteristics of each type of investment.
For example, while stock mutual funds may offer higher potential returns,
they also carry the highest degree of share price volatility. Likewise,
money market funds may offer greater stability of principal, but generally
do not offer the higher potential returns available from stock mutual
funds.
From time to time, a fund's performance may also be compared to other
mutual funds tracked by financial or business publications and periodicals.
For example, the fund may quote Morningstar, Inc. in its advertising
materials. Morningstar, Inc. is a mutual fund rating service that rates
mutual funds on the basis of risk-adjusted performance. Rankings that
compare the performance of Fidelity funds to one another in appropriate
categories over specific periods of time may also be quoted in advertising.
A fund may be compared in advertising to Certificates of Deposit (CDs) or
other investments issued by banks or other depository institutions. Mutual
funds differ from bank investments in several respects. For example, a fund
may offer greater liquidity or higher potential returns than CDs, a fund
does not guarantee your principal or your return, and fund shares are not
FDIC insured.
Fidelity may provide information designed to help individuals understand
their investment goals and explore various financial strategies. Such
information may include information about current economic, market, and
political conditions; materials that describe general principles of
investing, such as asset allocation, diversification, risk tolerance, and
goal setting; questionnaires designed to help create a personal financial
profile; worksheets used to project savings needs based on assumed rates of
inflation and hypothetical rates of return; and action plans offering
investment alternatives. Materials may also include discussions of
Fidelity's asset allocation funds and other Fidelity funds, products, and
services.
Ibbotson Associates of Chicago, Illinois (Ibbotson) provides historical
returns of the capital markets in the United States, including common
stocks, small capitalization stocks, long-term corporate bonds,
intermediate-term government bonds, long-term government bonds, Treasury
bills, the U.S. rate of inflation (based on the CPI), and combinations of
various capital markets. The performance of these capital markets is based
on the returns of different indices.
Fidelity funds may use the performance of these capital markets in order to
demonstrate general risk-versus-reward investment scenarios. Performance
comparisons may also include the value of a hypothetical investment in any
of these capital markets. The risks associated with the security types in
any capital market may or may not correspond directly to those of the
funds. Ibbotson calculates total returns in the same method as the funds.
The funds may also compare performance to that of other compilations or
indices that may be developed and made available in the future. 
A fund may compare its performance or the performance of securities in
which it may invest to averages published by IBC    Financial Data, Inc. of
Ashland, Massachusetts. These averages assume reinvestment of
distributions. IBC's MONEY FUND     REPORT AVERAGES(trademark)/All Taxable,
which is reported in IBC's MONEY FUND REPORT(trademark), covers over
   815     taxable money market funds. 
In advertising materials, Fidelity may reference or discuss its products
and services, which may include other Fidelity funds; retirement investing;
brokerage products and services; model portfolios or allocations; saving
for college or other goals; charitable giving; and the Fidelity credit
card. In addition, Fidelity may quote or reprint financial or business
publications and periodicals as they relate to current economic and
political conditions, fund management, portfolio composition, investment
philosophy, investment techniques, the desirability of owning a particular
mutual fund, and Fidelity services and products. Fidelity may also reprint,
and use as advertising and sales literature, articles from Fidelity Focus,
a quarterly magazine provided free of charge to Fidelity fund shareholders.
A fund may present its fund number, Quotron(trademark) number, and CUSIP
number, and discuss or quote its current portfolio manager.
A fund may be available for purchase through retirement plans or other
programs offering deferral of, or exemption from, income taxes, which may
produce superior after-tax returns over time. For example, a $1,000
investment earning a taxable return of 10% annually would have an after-tax
value of $1,949 after ten years, assuming tax was deducted from the return
each year at a 31% rate. An equivalent tax-deferred investment would have
an after-tax value of $2,100 after ten years, assuming tax was deducted at
a 31% rate from the tax-deferred earnings at the end of the ten-year
period.
As of November 30, 1996, FMR advised over $   28     billion in tax-free
fund assets, $   94     billion in money market fund assets, $   308    
billion in equity fund assets, $   60     billion in international fund
assets, and $   24     billion in Spartan fund assets. The funds may
   reference the growth and variety of money market mutual funds and the
adviser's innovation and participation in the industry.     The equity
funds under management figure represents the largest amount of equity fund
assets under management by a mutual fund investment adviser in the United
States, making FMR America's leading equity (stock) fund manager. FMR, its
subsidiaries, and affiliates maintain a worldwide information and
communications network for the purpose of researching and managing
investments abroad.
   Fidelity     Cash Reserves may be advertised as an investment choice
under the Fidelity College Savings Plan or the Fidelity Investor Card
mutual fund option. Advertising may contain illustrations of projected
future college costs based on assumed rates of inflation and examples of
hypothetical performance. Advertising for the Fidelity College Savings Plan
mutual fund option may be used in conjunction with advertising for the
Fidelity College Savings Plan brokerage option, a product offered through
Fidelity Brokerage Services, Inc. The Fidelity Investor Card is a product
offered through Fidelity Trust Company.
In addition to performance rankings, each fund may compare its total
expense ratio to the average total expense ratio of similar funds tracked
by Lipper. A fund's total expense ratio is a significant factor in
comparing bond and money market investments because of its effect on yield. 
ADDITIONAL PURCHASE AND REDEMPTION INFORMATION
Each fund is open for business and its net asset value per share (NAV) is
calculated each day the New York Stock Exchange    (NYSE) is open for
trading. The NYSE has designated the following holiday closings for 1997:
New Year's Day, Presidents' Day,     Good Friday, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day, and Christmas Day. Although
FMR expects the same holiday schedule to be observed in the future, the
NYSE may modify its holiday schedule at any time. In addition, the funds
will not process wire purchases and redemptions on days when the Federal
Reserve Wire System is closed.
FSC normally determines each fund's NAV as of the close of the NYSE
(normally 4:00 p.m. Eastern time). However, NAV may be calculated earlier
if trading on the NYSE is restricted or as permitted by the Securities and
Exchange Commission (SEC). To the extent that portfolio securities are
traded in other markets on days when the NYSE is closed, a fund's NAV may
be affected on days when investors do not have access to the fund to
purchase or redeem shares. In addition, trading in some of a fund's
portfolio securities may not occur on days when the fund is open for
business.
If the Trustees determine that existing conditions make cash payments
undesirable, redemption payments may be made in whole or in part in
securities or other property, valued for this purpose as they are valued in
computing a fund's NAV. Shareholders receiving securities or other property
on redemption may realize a gain or loss for tax purposes, and will incur
any costs of sale, as well as the associated inconveniences.
Pursuant to Rule 11a-3 under the 1940 Act, each fund is required to give
shareholders at least 60 days' notice prior to terminating or modifying its
exchange privilege. Under the Rule, the 60-day notification requirement may
be waived if (i) the only effect of a modification would be to reduce or
eliminate an administrative fee, redemption fee, or deferred sales charge
ordinarily payable at the time of an exchange, or (ii) the fund suspends
the redemption of the shares to be exchanged as permitted under the 1940
Act or the rules and regulations thereunder, or the fund to be acquired
suspends the sale of its shares because it is unable to invest amounts
effectively in accordance with its investment objective and policies.
In the Prospectus, each fund has notified shareholders that it reserves the
right at any time, without prior notice, to refuse exchange purchases by
any person or group if, in FMR's judgment, the fund would be unable to
invest effectively in accordance with its investment objective and
policies, or would otherwise potentially be adversely affected.
DISTRIBUTIONS AND TAXES
DISTRIBUTIONS. If you request to have distributions mailed to you and the
U.S. Postal Service cannot deliver your checks, or if your checks remain
uncashed for six months, Fidelity may reinvest your distributions at the
then-current NAV. All subsequent distributions will then be reinvested
until you provide Fidelity with alternate instructions.
DIVIDENDS. Because each fund's income is primarily derived from interest,
dividends from a fund generally will not qualify for the dividends-received
deduction available to corporate shareholders. Short-term capital gains are
distributed as dividend income, but do not qualify for the
dividends-received deduction. A portion of each fund's dividends derived
from certain U.S. Government obligations may be exempt from state and local
taxation. Each fund will send each shareholder a notice in January
describing the tax status of dividend and capital gain distributions (if
any) for the prior year.
CAPITAL GAIN DISTRIBUTIONS. Each fund may distribute any net realized
short-term capital gains once a year or more often as necessary, to
maintain its net asset value at $1.00 per share.
As of November 30, 1996,    Fidelity     Cash Reserves had a capital loss
carryforward aggregating approximately $   2,304,000    . This loss
carryforward, of which $   510,000    , $   1,634,000    , and $   160,000
    will expire on November 30,    2001    ,    2002    , and    2004     ,
respectively, is available to offset future capital gains. As of November
30, 1996,    Fidelity     U.S. Government Reserves had a capital loss
carryforward aggregating approximately $   85,000    . This loss
carryforward, of which $   19,000     and $   66,000     will expire on
November 30,    2001 and 2003    , respectively, is available to offset
future capital gains.
STATE AND LOCAL TAX ISSUES. For mutual funds organized as business trusts,
state law provides for a pass-through of the state and local income tax
exemption afforded to direct owners of U.S. Government securities. Some
states limit this to mutual funds that invest a certain amount in U.S.
Government securities, and some types of securities, such as repurchase
agreements and some agency backed securities, may not qualify for this
benefit. The tax treatment of your dividend distributions from a fund will
be the same as if you directly owned your proportionate share of the U.S.
Government securities in each fund's portfolio. Because the income earned
on most U.S. Government securities in which each fund invests is exempt
from state and local income taxes, the portion of your dividends from each
fund attributable to these securities will also be free from income taxes.
The exemption from state and local income taxation does not preclude states
from assessing other taxes on the ownership of U.S. Government securities.
In a number of states, corporate franchise (income) tax laws do not exempt
interest earned on U.S. Government securities whether such securities are
held directly or through a fund.
FOREIGN TAXES. Foreign governments may withhold taxes on dividends and
interest paid with respect to foreign securities. Foreign governments may
also impose taxes on other payments or gains with respect to foreign
securities. If, at the close of its fiscal year, more than 50% of a fund's
total assets are invested in securities of foreign issuers, the fund may
elect to pass through foreign taxes paid and thereby allow shareholders to
take a credit or deduction on their individual tax returns. 
TAX STATUS OF THE FUNDS. Each fund intends to qualify each year as a
"regulated investment company" for tax purposes so that it will not be
liable for federal tax on income and capital gains distributed to
shareholders. In order to qualify as a regulated investment company and
avoid being subject to federal income or excise taxes at the fund level,
each fund intends to distribute substantially all of its net investment
income and net realized capital gains within each calendar year as well as
on a fiscal year basis.
Each fund is treated as a separate entity from the other funds of Fidelity
Phillips Street Trust for tax purposes.
OTHER TAX INFORMATION. The information above is only a summary of some of
the tax consequences generally affecting each fund and its shareholders,
and no attempt has been made to discuss individual tax consequences. In
addition to federal income taxes, shareholders may be subject to state and
local taxes on fund distributions, and shares may be subject to state and
local personal property taxes. Investors should consult their tax advisers
to determine whether a fund is suitable to their particular tax situation.
FMR
All of the stock of FMR is owned by FMR Corp., its parent organized in
1972. The voting common stock of FMR Corp. is divided into two classes.
Class B is held predominantly by members of the Edward C. Johnson 3d family
and is entitled to 49% of the vote on any matter acted upon by the voting
common stock. Class A is held predominantly by non-Johnson family member
employees of FMR Corp. and its affiliates and is entitled to 51% of the
vote on any such matter. The Johnson family group and all other Class B
shareholders have entered into a shareholders' voting agreement under which
all Class B shares will be voted in accordance with the majority vote of
Class B shares. Under the 1940 Act, control of a company is presumed where
one individual or group of individuals owns more than 25% of the voting
stock of that company. Therefore, through their ownership of voting common
stock and the execution of the shareholders' voting agreement, members of
the Johnson family may be deemed, under the 1940 Act, to form a controlling
group with respect to FMR Corp.
At present, the principal operating activities of FMR Corp. are those
conducted by its division Fidelity Investments Retail Marketing Company,
which provides marketing services to various companies within the Fidelity
organization.
Fidelity investment personnel may invest in securities for their own
account pursuant to a code of ethics that sets forth all employees'
fiduciary responsibilities regarding the funds, establishes procedures for
personal investing and restricts certain transactions. For example, all
personal trades in most securities require pre-clearance, and participation
in initial public offerings is prohibited. In addition, restrictions on the
timing of personal investing in relation to trades by Fidelity funds and on
short-term trading have been adopted.
TRUSTEES AND OFFICERS
   The Trustees and executive officers of the trust are listed below.
Except as indicated, each     individual has held the office shown or other
offices in the same company for the last five years. Trustees and officers
elected or appointed to Fidelity Phillips Street Trust prior to the funds'
conversion from series of a Massachusetts business trust served in
identi   cal capacities. All persons named as Trustees also serve in
similar capacities for other funds a    dvised by FMR. The business address
of each Trustee and officer who is an "interested person" (as defined in
the 1940    Act    ) is 82        Devonshire Street, Boston, Massachusetts
02109, which is also the address of FMR. The business address of all the
other Trustees is Fidelity Investments, P.O. Box 9235, Boston,
Massachusetts 02205-9235. Those Trustees who are "interested persons" by
virtue of their affiliation with either the trust or FMR are indicated by
an asterisk (*).
   *EDWARD C. JOHNSON 3d (66), Trustee and President, is Chairman, Chief
Executive Officer and a Director of FMR Corp.;     a Director and Chairman
of the Board and of the Executive Committee of FMR; Chairman and a Director
of FMR Texas Inc., Fidelity Management & Research (U.K.) Inc., and Fidelity
Management & Research (Far East) Inc.
   *J. GARY BURKHEAD (55), Trustee and Senior Vice President, is President
of FMR; and President and a Director of FMR     Texas Inc., Fidelity
Management & Research (U.K.) Inc., and Fidelity Management & Research (Far
East) Inc.
   RALPH F. COX (64), Trustee (1991), is a management consultant (1994).
Prior to February 1994, he was President of Gree    nhill Petroleum
Corporation (petroleum exploration and production). Until March 1990, Mr.
Cox was President and Chief Operating Officer of Union Pacific Resources
Company (exploration and production). He is a Director of Sanifill
Corporation (non-hazardous waste, 1993), CH2M Hill Companies (engineering),
Rio Grande, Inc. (oil and gas production), and Daniel Industries (petroleum
measurement equipment manufacturer). In addition, he is a member of
advisory boards of Texas A&M University and the University of Texas at
Austin.
   PHYLLIS BURKE DAVIS (64), Trustee (1992). Prior to her retirement in
September 1991, Mrs. Davis was the Senior     Vice President of Corporate
Affairs of Avon Products, Inc. She is currently a Director of BellSouth
Corporation (telecommunications), Eaton Corporation (manufacturing, 1991),
and the TJX Companies, Inc. (retail stores), and previously served as a
Director of Hallmark Cards, Inc. (1985-1991) and Nabisco Brands, Inc. In
addition, she is a member of the President's Advisory Council of The
University of Vermont School of Business Administration.
   E. BRADLEY JONES (69), Trustee. Prior to his retirement in 1984, Mr.
Jones was Chairman and Chief Executive Officer o    f LTV Steel Company. He
is a Director of TRW Inc. (original equipment and replacement products),
Cleveland-Cliffs Inc (mining), Consolidated Rail Corporation, Birmingham
Steel Corporation, and RPM, Inc. (manufacturer of chemical products), and
he previously served as a Director of NACCO Industries, Inc. (mining and
marketing, 1985-1995) and Hyster-Yale Materials Handling, Inc. (1985-1995).
In addition, he serves as a Trustee of First Union Real Estate Investments,
a Trustee and member of the Executive Committee of the Cleveland Clinic
Foundation, a Trustee and member of the Executive Committee of University
School (Cleveland), and a Trustee of Cleveland Clinic Florida.
   DONALD J. KIRK (64), Trustee, is Executive-in-Residence (1995) at
Columbia University Graduate School of Business and     a financial
consultant. From 1987 to January 1995, Mr. Kirk was a Professor at Columbia
University Graduate School of Business. Prior to 1987, he was Chairman of
the Financial Accounting Standards Board. Mr. Kirk is a Director of General
Re Corporation (reinsurance), and he previously served as a Director of
Valuation Research Corp. (appraisals and valuations, 1993-1995). In
addition, he serves as Chairman of the Board of Directors of the National
Arts Stabilization Fund, Chairman of the Board of Trustees of the Greenwich
Hospital Association, a Member of the Public Oversight Board of the
American Institute of Certified Public Accountants' SEC Practice Section
(1995), and as a Public Governor of the National Association of Securities
Dealers, Inc. (1996).
   *PETER S. LYNCH (53), Trustee, is Vice Chairman and Director of FMR
(1992). Prior to May 31, 1990, he was a Director of FMR     and Executive
Vice President of FMR (a position he held until March 31, 1991); Vice
President of Fidelity Magellan Fund and FMR Growth Group Leader; and
Managing Director of FMR Corp. Mr. Lynch was also Vice President of
Fidelity Investments Corporate Services (1991-1992). He is a Director of
W.R. Grace & Co. (chemicals) and Morrison Knudsen Corporation (engineering
and construction). In addition, he serves as a Trustee of Boston College,
Massachusetts Eye & Ear Infirmary, Historic Deerfield (1989) and Society
for the Preservation of New England Antiquities, and as an Overseer of the
Museum of Fine Arts of Boston.
   GERALD C. McDONOUGH (67), Trustee and Vice-Chairman of the
non-interested Trustees, is Chairman of G.M.     Management Group
(strategic advisory services). Prior to his retirement in July 1988, he was
Chairman and Chief Executive Officer of Leaseway Transportation Corp.
(physical distribution services). Mr. McDonough is a Director of
Brush-Wellman Inc. (metal refining), York International Corp. (air
conditioning and refrigeration), Commercial Intertech Corp. (hydraulic
systems, building systems, and metal products, 1992), CUNO, Inc. (liquid
and gas filtration products, 1996), and Associated Estates Realty
Corporation (a real estate investment trust, 1993). Mr. McDonough served as
a Director of ACME-Cleveland Corp. (metal working, telecommunications, and
electronic products) from 1987-1996.
   MARVIN L. MANN (63), Trustee (1993) is Chairman of the Board, President,
and Chief Executive Officer of Lexmark     International, Inc. (office
machines, 1991). Prior to 1991, he held the positions of Vice President of
International Business Machines Corporation ("IBM") and President and
General Manager of various IBM divisions and subsidiaries. Mr. Mann is a
Director of M.A. Hanna Company (chemicals, 1993) and Infomart (marketing
services, 1991), a Trammell Crow Co. In addition, he serves as the Campaign
Vice Chairman of the Tri-State United Way (1993) and is a member of the
University of Alabama President's Cabinet.
WILLIAM O. McCOY (6   3    ),    Trustee     (199   7    ), is the Vice
President of Finance for the University of North Carolina (16-school
   system, 1995). Prior to his retirement in December 1994, Mr. McCoy was
Vice Chairman of the Board of BellSouth Corporation (telecommunications)
and President of BellSouth Enterprises. He is currently a Director of
Liberty Corporation (holding company), Weeks Corporation of Atlanta (real
estate, 1994), and Carolina Power and Light Company (electric utility,
1996). Previously, he was a Director of First American Corporation (bank
holding company, 1979-1996). In addition, Mr. McCoy serves as a member of
the Board of Visitors for the University of North Carolina at Chapel Hill
(1994) and for the Kenan Flager Business School (University of North
Carolina at Chapel Hill).
THOMAS R. WILLIAMS (68), Trustee, is President of The Wales Group, Inc.
(management and financial advisory services). Prior     to retiring in
1987, Mr. Williams served as Chairman of the Board of First Wachovia
Corporation (bank holding company), and Chairman and Chief Executive
Officer of The First National Bank of Atlanta and First Atlanta Corporation
(bank holding company). He is currently a Director of BellSouth Corporation
(telecommunications), ConAgra, Inc. (agricultural products), Fisher
Business Systems, Inc. (computer software), Georgia Power Company (electric
utility), Gerber Alley & Associates, Inc. (computer software), National
Life Insurance Company of Vermont, American Software, Inc., and AppleSouth,
Inc. (restaurants, 1992).
   SARAH H. ZENOBLE (47), Vice President, is Vice President of Fidelity's
money market funds (1996) and Vice President of FMR Texas Inc.
LELAND C. BARRON (38), is Vice President of Fidelity U.S. Government
Reserves, which he has managed since July 1991. He also     manages other
Fidelity money market funds.
   ROBERT LITTERST (37), is Vice President of Fidelity Cash Reserves, which
he has managed since January 1992. He also manages     other Fidelity money
market funds.
   ARTHUR S. LORING (49), Secretary, is Senior Vice President (1993) and
General Counsel of FMR, Vice President-Legal of     FMR Corp., and Vice
President and Clerk of FDC.
   KENNETH A. RATHGEBER (49), Treasurer (1995), is Treasurer of the
Fidelity funds and is an employee of FMR (1995).     Before joining FMR,
Mr. Rathgeber was a Vice President of Goldman Sachs & Co. (1978-1995),
where he served in various positions, including Vice President of
Proprietary Accounting (1988-1992), Global Co-Controller (1992-1994), and
Chief Operations Officer of Goldman Sachs (Asia) LLC (1994-1995).
   THOMAS D. MAHER (51), Assistant Vice President, is Assistant Vice
President of Fidelity's money market funds and Vice     President and
Associate General Counsel of FMR Texas Inc. 
   JOHN H. COSTELLO (50), Assistant Treasurer, is an employee of FMR.
LEONARD M. RUSH (50), Assistant Treasurer (1994), is an employee of FMR
(1994). Prior to becoming Assistant Treasurer     of the Fidelity funds,
Mr. Rush was Chief Compliance Officer of FMR Corp. (1993-1994) and Chief
Financial Officer of Fidelity Brokerage Services, Inc. (1990-1993).
   THOMAS J. SIMPSON (38), Assistant Treasurer (1996), is Assistant
Treasurer of Fidelity's money market funds and an employee of FMR (1996).
Prior to joining FMR, Mr. Simpson was Vice President and Fund Controller of
Liberty Investment Services (1987-1995).    
The following table sets forth information describing the compensation of
each Trustee of each fund for his or her services as trustee for the fiscal
year ended November 30, 1996.
COMPENSATION TABLE
      Aggregate Compensation   
 
 
 
 
<TABLE>
<CAPTION>
<S>    <C>        <C>    <C>     <C>     <C>       <C>     <C>     <C>      <C>       <C>       <C>    <C>         <C>              
       J. Gary    Ralph  Phyllis Richard Edward C. E.      Donald  Peter S. Gerald C. Edward H. Marvin  William O. Thomas           
       Burkhead** F. Cox Burke   J.      Johnson   Bradley J. Kirk Lynch**  McDonoug  Malone                       R
                         Davis   Flynn   3d**      Jones                    h         (double                      Williams
                                 (double                                              dagger)   L. Mann McCoy
                                 dagger)                                                                (double 
                                                                                                        dagger)
                                                                                                        (double 
                                                                                                        dagger) 
 
 Fidelity 
       $ 0      $ 6,433  $ 6,277 $ 8,284 $ 0       $ 6,354 $ 6,426 $ 0      $ 6,343  $ 6,446*** $ 6,295 $ 3,584    $ 6,348    
  Cash                                                                                                                   
Reserves   
 
 Fidelity U.S.      
       $ 0      $ 400    $ 394   $ 519   $ 0       $ 399   $ 403   $ 0      $ 398    $ 392      $ 392   $ 220      $ 399      
Government                                  
Reserves            
 
</TABLE>
 
 
<TABLE>
<CAPTION>
<S>                                                     <C>                  <C>                 <C>                      
Trustees                                                Pension or           Estimated Annual    Total                    
                                                        Retirement           Benefits Upon       Compensation             
                                                        Benefits Accrued     Retirement from     from the Fund            
                                                        as Part of Fund      the Fund Complex*   Complex*                 
                                                        Expenses from the                                                 
                                                        Fund Complex*                                                     
 
J. Gary Burkhead**                                      $ 0                  $ 0                 $ 0                      
 
Ralph F. Cox                                             5,200                52,000                 132,500              
 
Phyllis Burke Davis                                      5,200                52,000              12   9    ,   5    00   
 
Richard J. Flynn   (double dagger)                       0                    52,000              16   8    ,   0    00   
 
Edward C. Johnson 3d**                                   0                    0                   0                       
 
E. Bradley Jones                                         5,200                49,400              12   9    ,500          
 
Donald J. Kirk                                           5,200                52,000              1   31    ,   0    00   
 
Peter S. Lynch**                                         0                    0                   0                       
 
Gerald C. McDonough                                      5,200                52,000              1   31    ,000          
 
Edward H. Malone   (double dagger)                       5,200                44,200              1   31    ,000          
 
Marvin L. Mann                                           5,200                52,000              1   29    ,   5    00   
 
   William O. McCoy(double dagger)(double dagger)          N/A                  N/A                  85,333               
 
Thomas R. Williams                                       5,200                52,000              1   31    ,000          
 
</TABLE>
 
   * Information is as of December 31, 1996 for 235 funds in the complex.
** Interested trustees of the fund are compensated by FMR.
*** For the fiscal year ended November 30, 1996, certain of the
non-interested trustees' aggregate compensation from a fund includes
accrued deferred compensation as follows: Edward H. Malone, $6,446, for
Fidelity Cash Reserves.
(double dagger) Prior to December 31, 1996, Richard J. Flynn and Edward H.
Malone served on the Board of Trustees.
(double dagger)(double dagger) During the period from May 1, 1996 through
December 31, 1996, William O. McCoy served as a Member of the Advisory
Board.    
The non-interested Trustees may elect to defer receipt of all or a
percentage of their annual fees in accordance with the terms of a Deferred
Compensation Plan (the Plan). Under the Plan, compensation deferred by a
Trustee is periodically adjusted as though an equivalent amount had been
invested and reinvested in shares of one or more funds in the complex
designated by such Trustee (designated securities). The amount paid to the
Trustee under the Plan will be determined based upon the performance of
such investments. Deferral of Trustees' fees in accordance with the Plan
will have a negligible effect on a fund's assets, liabilities, and net
income per share, and will not obligate the fund to retain the services of
any Trustee or to pay any particular level of compensation to the Trustee.
Each fund may invest in such designated securities under the Plan without
shareholder approval.
Under a retirement program adopted in July 1988 and modified in November
1995, each non-interested Trustee may receive payments from a Fidelity fund
during his or her lifetime based on his or her basic trustee fees and
length of service. The obligation of a fund to make such payments is
neither secured nor funded. A Trustee becomes eligible to participate in
the program at the end of the calender year in which he or she reaches age
72, provided that, at the time of retirement, he or she has served as a
Fidelity fund Trustee for at least five years. Currently, Messrs. Ralph S.
Saul, William R. Spaulding, Bertram H. Witham, and David L. Yunich, all
former non-interested Trustees, receive retirement benefits under the
program.
   As of November 30, 1996,     the Trustees and officers of each fund
owned, in the aggregate, less than    1    % of each fund's total
outstanding shares.
MANAGEMENT CONTRACTS
Each fund employs FMR to furnish investment advisory and other services.
Under its management contract with each fund, FMR acts as investment
adviser and, subject to the supervision of the Board of Trustees, directs
the investments of each fund in accordance with its investment objective,
policies, and limitations. FMR also provides each fund with all necessary
office facilities and personnel for servicing each fund's investments,
compensates all officers of each fund and all Trustees who are "interested
persons" of the trust or of FMR, and all personnel of each fund or FMR
performing services relating to research, statistical, and investment
activities.
In addition, FMR or its affiliates, subject to the supervision of the Board
of Trustees, provide the management and administrative services necessary
for the operation of each fund. These services include providing facilities
for maintaining each fund's organization; supervising relations with
custodians, transfer and pricing agents, accountants, underwriters, and
other persons dealing with each fund; preparing all general shareholder
communications and conducting shareholder relations; maintaining each
fund's records and the registration of each fund's shares under federal and
state laws; developing management and shareholder services for each fund;
and furnishing reports, evaluations, and analyses on a variety of subjects
to the Trustees.
In addition to the management fee payable to FMR and the fees payable to
FSC, each fund pays all of its expenses, without limitation, that are not
assumed by those parties. Each fund pays for the typesetting, printing, and
mailing of its proxy materials to shareholders, legal expenses, and the
fees of the custodian, auditor and non-interested Trustees. Although each
fund's current management contract provides that each fund will pay for
typesetting, printing, and mailing prospectuses, statements of additional
information, notices, and reports to shareholders, the trust, on behalf of
each fund has entered into a revised transfer agent agreement with FSC,
pursuant to which FSC bears the costs of providing these services to
existing shareholders. Other expenses paid by each fund include interest,
taxes, brokerage commissions, and each fund's proportionate share of
insurance premiums and Investment Company Institute dues. Each fund is also
liable for such non-recurring expenses as may arise, including costs of any
litigation to which each fund may be a party, and any obligation it may
have to indemnify its officers and Trustees with respect to litigation.
FMR is    Fidelity     Cash Reserves' and    Fidelity     U.S. Government
Reserves' manager pursuant to management contracts dated December 1,
1993    and January 13, 1995    , respectively, which were approved by
shareholders on November 17, 1993    and September 21, 1994    ,
respectively.
For the services of FMR under the contracts, each fund pays FMR a monthly
management fee composed of a group fee rate, an individual fund fee rate
(.03%), and an income-based component of 6% of each fund's gross income in
excess of a 5% yield. The maximum income-based component is .24% of average
net assets.
The group fee rate is based on the monthly average net assets of all of the
registered investment companies with which FMR has management contracts and
is calculated on a cumulative basis pursuant to the graduated fee rate
schedule shown below on the left. The schedule    on page 18 at     right
shows the effective annual group fee rate at various asset levels, which is
the result of cumulatively applying the annualized rates on the left. For
example, the effective annual fee rate at $   447     billion of group net
assets - the approximate level for November 1996 - was    .1429    %, which
is the weighted average of the respective fee rates for each level of group
net assets up to $   447     billion.
GROUP FEE RATE SCHEDULE   EFFECTIVE ANNUAL FEE RATES   
 
Average Group     Annualized   Group Net        Effective Annual   
Assets            Rate         Assets           Fee Rate           
 
 0 - $3 billion   .3700%        $ 0.5 billion   .3700%             
 
 3 - 6            .3400          25             .2664              
 
 6 - 9            .3100          50             .2188              
 
 9 - 12           .2800          75             .1986              
 
 12 - 15          .2500          100            .1869              
 
 15 - 18          .2200          125            .1793              
 
 18 - 21          .2000          150            .1736              
 
 21 - 24          .1900          175            .1695              
 
 24 - 30          .1800          200            .1658              
 
 30 - 36          .1750          225            .1629              
 
 36 - 42          .1700          250            .1604              
 
 42 - 48          .1650          275            .1583              
 
 48 - 66          .1600          300            .1565              
 
 66 - 84          .1550          325            .1548              
 
 84 - 120         .1500          350            .1533              
 
 120 - 174        .1450          400            .1507              
 
 174 - 228        .1400                                            
 
 228 - 282        .1375                                            
 
 282 - 336        .1350                                            
 
 Over 336         .1325                                            
 
Under    Fidelity     Cash Reserves' current management contract with FMR,
the group fee rate is based on a schedule with breakpoints ending at .1400%
for average group assets in excess of $174 billion. Prior to December 1,
1993, the group fee rate breakpoints shown above for average group assets
in excess of $120 billion and under $228 billion were voluntarily adopted
by FMR on January 1, 1992. The additional breakpoints shown above for
average group assets in excess of $228 billion were voluntarily adopted by
FMR on November 1, 1993.
Prior to January 13, 1995 for    Fidelity     U.S. Government Reserves, the
group fee rate was based on a schedule with breakpoints ending at .1500%
for average group assets in excess of $84 billion. The group fee rate
breakpoints shown above for average group assets in excess of $120 billion
and under $228 billion were voluntarily adopted by FMR on January 1, 1992.
The additional breakpoints shown above for average group assets in excess
of $228 billion were voluntarily adopted by FMR on November 1, 1993. The
fund's current management contract reflects these extensions of the group
fee rate schedule.
On August 1, 1994, FMR voluntarily revised the prior extensions to the
group fee rate schedule, and added new breakpoints for average group assets
in excess of $156 billion and under $372 billion as shown in the schedule
below. The revised group fee rate schedule was identical to the above
schedule for average group assets under $156 billion. 
On January 1, 1996, FMR voluntarily added new breakpoints to the revised
schedule for average group assets in excess of $372 billion, pending
shareholder approval of a new management contract reflecting the revised
schedule and additional breakpoints. The revised group fee rate schedule
and its extensions provide for lower management fee rates as FMR's assets
under management increase. For average group assets in excess of $156
billion, the revised group fee rate schedule with additional breakpoints
voluntarily adopted by FMR is as follows:
GROUP FEE RATE SCHEDULE   EFFECTIVE ANNUAL FEE RATES   
 
Average Group         Annualized   Group Net        Effective Annual   
Assets                Rate         Assets           Fee Rate           
 
 120 - $156 billion   .1450%        $ 150 billion   .1736%             
 
 156 - 192            .1400          175            .1690              
 
 192 - 228            .1350          200            .1652              
 
 228 - 264            .1300          225            .1618              
 
 264 - 300            .1275          250            .1587              
 
 300 - 336            .1250          275            .1560              
 
 336 - 372            .1225          300            .1536              
 
 372 - 408            .1200          325            .1514              
 
 408 - 444            .1175          350            .1494              
 
 444 - 480            .1150          375            .1476              
 
 480 - 516            .1125          400            .1459              
 
 Over 516             .1100          425            .1443              
 
                                     450            .1427              
 
                                     475            .1413              
 
                                     500            .1399              
 
                                     525            .1385              
 
                                     550            .1372              
 
Each fund's individual fund fee rate is .03%.
One-twelfth of the sum of the group fee rate and the individual fund fee
rate is applied to the fund's average net assets for the current month,
giving a dollar amount which is the fee for that month.    Fidelity
    Cash Reserves' contract further provides that FMR will reimburse the
fund, in an amount not in excess of the fund's management fee for any
fiscal year, if the fund's aggregate operating expenses exceed 1% of the
average net assets of the fund.
If a fund's monthly gross yield is 5% or less, the total management fee is
the sum of the group fee and the individual fund fee. If a fund's monthly
gross yield is greater than 5%, the management fee that FMR receives
includes an income-based component. The income-based component equals 6% of
that portion of the fund's gross income that represents a gross yield of
more than 5% per year. The maximum income-based component is .24%
(annualized) of average net assets, at a fund gross yield of 9% or more.
Gross income for this purpose, includes interest accrued and/or discount
earned (including both original issue discount and market discount) on
portfolio obligations, less amortization of premium. Realized and
unrealized gains and losses, if any, are not included in gross income.
Prior to January 13, 1995,    Fidelity     U.S. Government Reserves'
management contract was dated October 1, 1994, and was approved by
shareholders on September 21, 1994 in conjunction with an Agreement and
Plan to convert the fund from a series of a Massachusetts business trust to
a series of a Delaware business trust.
The table below shows the management fees paid to FMR by each fund for the
last three fiscal    periods    :
 
<TABLE>
<CAPTION>
<S>                       <C>                             <C>                       
                             Fidelity     Cash Reserves   Management Fees as a      
Years Ended November 30   Management Fees                 % of Average Net Assets   
 
    1996                     $ 40,411,000                     .2096%                
 
 1995                        $ 40,864,000                     .2455%                
 
 1994                        $ 23,686,000                     .1910%                
 
</TABLE>
 
 
<TABLE>
<CAPTION>
<S>                       <C>                                        <C>                           
                             Fidelity     U.S. Government Reserves   Management Fees as a          
Years Ended November 30   Management Fees                            % of Average Net Assets       
 
 1996                        $ 2,461,000                                 .2069%                    
 
 1995                        $ 2,762,000                                 .2405%                    
 
 1994*                       $ 361,000                                   .1957% (annualized)       
 
</TABLE>
 
   * For the period October 1, 1994 through November 30, 1994.    
FMR may, from time to time, voluntarily reimburse all or a portion of each
fund's operating expenses (exclusive of interest, taxes, brokerage
commissions, and extraordinary expenses). FMR retains the ability to be
repaid for these expense reimbursements in the amount that expenses fall
below the limit prior to the end of the fiscal year. Expense reimbursements
by FMR will increase each fund's total returns and yield and repayment of
the reimbursement by each fund will lower its total returns and yield.
To comply with the California Code of Regulations, FMR will reimburse each
fund if and to the extent that each fund's aggregate annual operating
expenses exceed specified percentages of its average net assets. The
applicable percentages are 2 1/2% of the first $30 million, 2% of the next
$70 million, and 1 1/2% of average net assets in excess of $100 million.
When calculating each fund's expenses for purposes of this regulation, each
fund may exclude interest, taxes, brokerage commissions, and extraordinary
expenses, as well as a portion of its distribution plan expenses and
custodian fees attributable to investments in foreign securities.
SUB-ADVISER. FMR has entered into a sub-advisory agreement with FMR Texas
pursuant to which FMR Texas has primary responsibility for providing
portfolio investment management services to each fund.
Under the sub-advisory agreements, dated January 13, 1995 for    Fidelity
    U.S. Government Reserves and January 24, 1993 for    Fidelity     Cash
Reserves, which were approved by shareholders on September 21, 1994 for
   Fidelity     U.S. Government Reserves and by FMR as the then sole
shareholder on January 24, 1993 for    Fidelity     Cash Reserves, FMR pays
FMR Texas fees equal to 50% of the management fee payable to FMR under its
management contract with each fund. The fees paid to FMR Texas are not
reduced by any voluntary or mandatory expense reimbursements that may be in
effect from time to time. The following table shows fees FMR paid to FMR
Texas on behalf of each fund for the fiscal    periods     ended November
30, 1996, 1995, and 1994:
 
<TABLE>
<CAPTION>
<S>                                <C>                   <C>                      <C>            
                                                         Fees Paid to FMR Texas                  
 
                                   1996                  1995                     1994           
 
   Fidelity     Cash Reserves      $ 20,20   5    ,000   $ 20,432,000             $ 11,843,000   
 
   Fidelity     U.S. Government    $    1,231,000        $ 1,381,000              $ 181,000*     
Reserves                                                                                         
 
</TABLE>
 
   * The fees shown were paid from October 1, 1994 through November 30,
1994.    
DISTRIBUTION AND SERVICE PLANS
The Trustees have approved Distribution and Service Plans on behalf of the
funds (the Plans) pursuant to Rule 12b-1 under the 1940    Act     (the
Rule). The Rule provides in substance that a mutual fund may not engage
directly or indirectly in financing any activity that is primarily intended
to result in the sale of shares of a fund except pursuant to a plan
approved on behalf of the fund under the Rule. The Plans, as approved by
the Trustees, allow the funds and FMR to incur certain expenses that might
be considered to constitute indirect payment by the funds of distribution
expenses.
Under each Plan, if the payment of management fees by the funds to FMR is
deemed to be indirect financing by the funds of the distribution of their
shares, such payment is authorized by the Plans. Each Plan also
specifically recognizes that FMR, either directly or through FDC, may use
its management fee revenue, past profits, or other resources, without
limitation, to pay promotional and administrative expenses in connection
with the offer and sale of shares of each fund. In addition, each Plan
provides that FMR may use its resources, including its management fee
revenues, to make payments to third parties that assist in selling shares
of each fund, or to third parties, including banks, that render shareholder
support services.
   No third party payments were made in fiscal years ended November 30,
1996, 1995, and 1994.    
Prior to approving each Plan, the Trustees carefully considered all
pertinent factors relating to the implementation of the Plan, and have
determined that there is a reasonable likelihood that the Plan will benefit
the fund and its shareholders. In particular, the Trustees noted that the
Plans do not authorize payments by a fund other than those made to FMR
under its management contract with the fund. To the extent that each Plan
gives FMR and FDC greater flexibility in connection with the distribution
of shares of each fund, additional sales of fund shares may result.
Furthermore, certain shareholder support services may be provided more
effectively under the Plans by local entities with whom shareholders have
other relationships.
The Plans were approved by FMR as the then sole shareholder of    Fidelity
    U.S. Government Reserves on January 13, 1995 and as the then sole
shareholder of    Fidelity     Cash Reserves on January 24, 1993.
   Fidelity     U.S. Government Reserves' Plan was approved by shareholders
on September 21, 1994, in connection with a reorganization transaction on
January 13, 1995, pursuant to an Agreement and Plan of Conversion.
   Fidelity     Cash Reserves' Plan was approved by shareholders on
November 18, 1992, in connection with a reorganization transaction on
January 24, 1993, pursuant to an Agreement and Plan of Conversion.
The Glass-Steagall Act generally prohibits federally and state chartered or
supervised banks from engaging in the business of underwriting, selling, or
distributing securities. Although the scope of this prohibition under the
Glass-Steagall Act has not been clearly defined by the courts or
appropriate regulatory agencies, FDC believes that the Glass-Steagall Act
should not preclude a bank from performing shareholder support services, or
servicing and recordkeeping functions. FDC intends to engage banks only to
perform such functions. However, changes in federal or state statutes and
regulations pertaining to the permissible activities of banks and their
affiliates or subsidiaries, as well as further judicial or administrative
decisions or interpretations, could prevent a bank from continuing to
perform all or a part of the contemplated services. If a bank were
prohibited from so acting, the Trustees would consider what actions, if
any, would be necessary to continue to provide efficient and effective
shareholder services. In such event, changes in the operation of the funds
might occur, including possible termination of any automatic investment or
redemption or other services then provided by the bank. It is not expected
that shareholders would suffer any adverse financial consequences as a
result of any of these occurrences. In addition, state securities laws on
this issue may differ from the interpretations of federal law expressed
herein, and banks and financial institutions may be required to register as
dealers pursuant to state law. 
Each fund may execute portfolio transactions with, and purchase securities
issued by, depository institutions that receive payments under the Plans.
No preference for the instruments of such depository institutions will be
shown in the selection of investments.
CONTRACTS WITH FMR AFFILIATES
FSC, an affiliate of FMR, is transfer, dividend disbursing, and shareholder
servicing agent for each fund. FSC receives an annual account fee and an
asset-based fee each based on account size and fund type for each retail
account and certain institutional accounts. With respect to certain
institutional retirement accounts, FSC receives an annual account fee and
an asset-based fee based on account type or fund type. These annual account
fees are subject to increase based on postal rate changes. FSC also
collects small account fees from certain accounts with balances of less
than $2,500.
FSC pays out-of-pocket expenses associated with providing transfer agent
services. In addition, FSC bears the expense of typesetting, printing, and
mailing prospectuses, statements of additional information, and all other
reports, notices, and statements to shareholders, with the exception of
proxy statements.
FSC also performs the calculations necessary to determine each fund's NAV
and dividends, and maintains each fund's accounting records. The annual fee
rates for these pricing and bookkeeping services are based on each fund's
average net assets, specifically, .0175% of the first $500 million of
average net assets and .0075% of average net assets in excess of $500
million. The fee is limited to a minimum of $40,000 and a maximum of
$800,000 per year.
The table below shows the fees paid to FSC for pricing and bookkeeping
services, including related out-of-pocket expenses during each fund's last
three fiscal    periods    :
      Pricing and Bookkeeping Fees                     
 
                            1996               1995       1994             
 
Fidelity Cash Reserves         $ 804,000       $750,000   $750,000         
 
Fidelity U.S. Government       $ 140,000       $136,000   $22,000*         
Reserves                                                                   
 
   * The fees shown were paid from October 1, 1994 through November 30,
1994.    
Each fund has a distribution agreement with FDC, a Massachusetts
corporation organized on July 18, 1960. FDC is a broker-dealer registered
under the Securities Exchange Act of 1934 and is a member of the National
Association of Securities Dealers, Inc. The distribution agreements call
for FDC to use all reasonable efforts, consistent with its other business,
to secure purchasers for shares of each fund, which are continuously
offered at net asset value. Promotional and administrative expenses in
connection with the offer and sale of shares are paid by FMR   .    
DESCRIPTION OF THE TRUST
TRUST ORGANIZATION. Fidelity Cash Reserves    and     Fidelity U.S.
Government Reserves        are funds of Fidelity Phillips Street Trust, an
open-end management investment company organized as a Delaware business
trust on September 17, 1992. On January 24, 1993, Fidelity Cash Reserves
acquired all of the assets of Fidelity Cash Reserves, a series of a
Massachusetts business trust also named Fidelity Cash Reserves. On January
13, 1995, Fidelity U.S. Government Reserves acquired all of the assets of
Fidelity U.S. Government Reserves, a series of a Massachusetts business
trust named Fidelity Charles Street Trust. Currently, there are two funds
of Fidelity Phillips Street Trust: Fidelity Cash Reserves and Fidelity U.S.
Government Reserves. The Trust Instrument permits the Trustees to create
additional funds.
In the event that FMR ceases to be the investment adviser to the trust or a
fund, the right of the trust or fund to use the identifying name "Fidelity"
may be withdrawn. There is a remote possibility that one fund might become
liable for any misstatement in its prospectus or statement of additional
information about another fund.
The assets of the trust received for the issue or sale of shares of each
fund and all income, earnings, profits, and proceeds thereof, subject only
to the rights of creditors, are especially allocated to such fund, and
constitute the underlying assets of such fund. The underlying assets of
each fund are segregated on the books of account, and are to be charged
with the liabilities with respect to such fund and with a share of the
general expenses of the trust. Expenses with respect to the trust are to be
allocated in proportion to the asset value of the respective funds, except
where allocations of direct expense can otherwise be fairly made. The
officers of the trust, subject to the general supervision of the Board of
Trustees, have the power to determine which expenses are allocable to a
given fund, or which are general or allocable to all of the funds. In the
event of the dissolution or liquidation of the trust, shareholders of each
fund are entitled to receive as a class the underlying assets of such fund
available for distribution.
SHAREHOLDER AND TRUSTEE LIABILITY. The trust is a business trust organized
under Delaware law. Delaware law provides that shareholders shall be
entitled to the same limitations of personal liability extended to
stockholders of private corporations for profit. The courts of some states,
however, may decline to apply Delaware law on this point. The Trust
Instrument contains an express disclaimer of shareholder liability for the
debts, liabilities, obligations, and expenses of the trust and requires
that a disclaimer be given in each contract entered into or executed by the
trust or the Trustees. The Trust Instrument provides for indemnification
out of each fund's property of any shareholder or former shareholder held
personally liable for the obligations of the fund. The Trust Instrument
also provides that each fund shall, upon request, assume the defense of any
claim made against any shareholder for any act or obligation of the fund
and satisfy any judgment thereon. Thus, the risk of a shareholder incurring
financial loss on account of shareholder liability is limited to
circumstances in which Delaware law does not apply, no contractual
limitation of liability was in effect, and the fund is unable to meet its
obligations. FMR believes that, in view of the above, the risk of personal
liability to shareholders is extremely remote.
The Trust Instrument further provides that the Trustees, if they have
exercised reasonable care, shall not be personally liable to any person
other than the trust or its shareholders; moreover, the Trustees shall not
be liable for any conduct whatsoever, provided that Trustees are not
protected against any liability to which they would otherwise be subject by
reason of willful misfeasance, bad faith, gross negligence, or reckless
disregard of the duties involved in the conduct of their office.
VOTING RIGHTS. Each fund's capital consists of shares of beneficial
interest. As a shareholder, you receive one vote for each dollar value of
net asset value you own. The shares have no preemptive or conversion
rights; the voting and dividend rights, the right of redemption, and the
privilege of exchange are described in the Prospectus. Shares are fully
paid and nonassessable, except as set forth under the heading "Shareholder
and Trustee Liability" above. Shareholders representing 10% or more of the
trust or a fund may, as set forth in the Trust Instrument, call meetings of
the trust or fund for any purpose related to the trust or fund, as the case
may be, including, in the case of a meeting of the entire trust, the
purpose of voting on removal of one or more Trustees. 
The trust or any fund may be terminated upon the sale of its assets to, or
merger with, another open-end management investment company or series
thereof, or upon liquidation and distribution of its assets. Generally such
terminations must be approved by vote of the holders of a majority of the
trust or the fund, as determined by the current value of each shareholder's
investment in the fund or trust; however, the Trustees may, without prior
shareholder approval, change the form of organization of the trust by
merger, consolidation, or incorporation. If not so terminated or
reorganized, the trust and its funds will continue indefinitely. 
Under the Trust Instrument, the Trustees may, without shareholder vote,
cause the trust to merge or consolidate into one or more trusts,
partnerships, or corporations, or cause the trust to be incorporated under
Delaware law, so long as the surviving entity is an open-end management
investment company that will succeed to or assume the trust registration
statement.
CUSTODIAN. The Bank of New York, 110 Washington Street, New York, New York,
is custodian of the assets of the funds. The custodian is responsible for
the safekeeping of a fund's assets and the appointment of any subcustodian
banks and clearing agencies. The custodian takes no part in determining the
investment policies of a fund or in deciding which securities are purchased
or sold by a fund. However, a fund may invest in obligations of the
custodian and may purchase securities from or sell securities to the
custodian. The Chase Manhattan Bank, headquartered in New York, also may
serve as a special purpose custodian of certain assets in connection with
repurchase agreement transactions.
FMR, its officers and directors, its affiliated companies, and the Board of
Trustees may, from time to time, conduct transactions with various banks,
including banks serving as custodians for certain funds advised by FMR.
Transactions that have occurred to date include mortgages and personal and
general business loans. In the judgment of FMR, the terms and conditions of
those transactions were not influenced by existing or potential custodial
or other fund relationships.
AUDITORS. Coopers & Lybrand L.L.P., 1999 Bryan Street,    Suite 3000,
    Dallas, Texas serves as    Fidelity     Cash Reserves' independent
accountant. Price Waterhouse LLP, 2001 Ross Avenue, Suite 1800, Dallas,
Texas serves as    Fidelity     U.S. Government Reserves' independent
accountant. The auditors examine financial statements for the funds and
provide other audit, tax, and related services.
FINANCIAL STATEMENTS
Each fund's financial statements   ,     financial highlights for the
fiscal year ended November 30, 1996   , and the report of the auditors
thereon     are included in the fund's Annual Report, which is a separate
report supplied with this Statement of Additional Information. Each fund's
financial statements   ,     financial highlights   , and the report of the
auditors thereon     are incorporated herein by reference. 
APPENDIX
The descriptions that follow are examples of eligible ratings for the
funds. A fund may, however, consider the ratings for other types of
investments and the ratings assigned by other rating organizations when
determining the eligibility of a particular investment.
DESCRIPTION OF MOODY'S INVESTORS SERVICE COMMERCIAL PAPER RATINGS:
Issuers rated PRIME-1 (or related supporting institutions) have a superior
capacity for repayment of short-term promissory obligations. Prime-1
repayment capacity will normally be evidenced by the following
characteristics:
Leading market positions in well established industries.
High rates of return on funds employed.
Conservative capitalization structures with moderate reliance on debt and
ample asset protection.
Broad margins in earning coverage of fixed financial charges and with high
internal cash generation.
Well established access to a range of financial markets and assured sources
of alternate liquidity.
Issuers rated PRIME-2 (or related supporting institutions) have a strong
capacity for repayment of short-term promissory obligations. This will
normally be evidenced by many of the characteristics cited above but to a
lesser degree. Earning trends and coverage ratios, while sound, will be
more subject to variation. Capitalization characteristics, while still
appropriate, may be more affected by external conditions. Ample alternate
liquidity is maintained.
DESCRIPTION OF STANDARD & POOR'S COMMERCIAL PAPER RATINGS:
A - Issues assigned this highest rating are regarded as having the greatest
capacity for timely payment. Issues in this category are delineated with
the numbers 1, 2, and 3 to indicate the relative degree of safety.
A-1 - This designation indicates that the degree of safety regarding timely
payment is either overwhelming or very strong. Those issues determined to
possess overwhelming safety characteristics will be denoted with a plus (+)
sign designation.
A-2 - Capacity for timely payment on issues with this designation is
strong. However, the relative degree of safety is not as high as for issues
designated A-1.
 
 
 
Fidelity Phillips Street Trust
PART C - OTHER INFORMATION
Item 24. Financial Statements and Exhibits
(a)(i) Financial statements and financial highlights included in the Annual
Report for Fidelity Cash Reserves for the fiscal year ended November 30,
1996 are incorporated herein by reference to the fund's Statement of
Additional Information and were filed on January 7, 1997 for Fidelity
Phillips Street Trust (File No. 811-2890) pursuant to Rule 30d-1 under the
Investment Company Act of 1940 and are incorporated herein by reference.
(a)(ii) Financial statements and financial highlights included in the
Annual Report for Fidelity U.S. Government Reserves for the fiscal year
ended November 30, 1996, are incorporated herein by reference to the fund's
Statement of Additional Information and were filed on January 7, 1997 for
Fidelity Phillips Street Trust (File No. 811-2890) pursuant to Rule 30d-1
under the Investment Company Act of 1940 and are incorporated herein by
reference.
(b) Exhibits
 1. (a) Trust Instrument dated September 17, 1992 is incorporated herein by
reference to   Exhibit 1(g) to Post-Effective Amendment No. 35.
 2. (a) Bylaws of the Trust, as amended, are incorporated herein by
reference to Exhibit 2(a) to Fidelity Union Street Trust II's (File No.
33-43757) Post-Effective Amendment No. 10.
 3. Not applicable.
 4. Not applicable.
 5. (a) Management Contract, dated December 1, 1993, between Fidelity Cash
Reserves and Fidelity Management & Research Company is incorporated herein
by reference to Exhibit 5(a) to Post-Effective Amendment No. 38.
  (b) Sub-Advisory Agreement, dated January 24, 1993, between Fidelity
Management & Research Company and FMR Texas Inc. on behalf of Fidelity Cash
Reserves is incorporated herein by reference to Exhibit 5(b) to
Post-Effective Amendment No. 35.
  (c) Management Contract, dated January 13, 1995, between Fidelity U.S.
Government Reserves and Fidelity Management & Research Company is
incorporated herein by reference to Exhibit 5(c) to Post-Effective
Amendment No. 40.
  (d) Form of Sub-Advisory Agreement between Fidelity Management & Research
Company and FMR Texas Inc. on behalf of Fidelity U.S. Government Reserves
was filed as Exhibit 5(d) to Post-Effective Amendment No. 38.
 6. (a) General Distribution Agreement, dated January 24, 1993, between
Fidelity Phillips Street Trust and Fidelity Distributors Corporation with
respect to Fidelity Cash Reserves is incorporated herein by reference to
Exhibit 6(a) to Post-Effective Amendment No. 35.
  (b) Form of General Distribution Agreement between Fidelity Phillips
Street Trust and Fidelity Distributors Corporation with respect to Fidelity
U.S. Government Reserves was filed as Exhibit 6(b) to Post-Effective
Amendment No. 38
 
 
  (c) Amendments to the General Distribution Agreement between the
Registrant and Fidelity Distributers Corporation, dated March 14, 1996 and
July 15, 1996, are incorporated herein by reference to Exhibit 6(a) of
Fidelity Court Street Trust's Post-Effective Amendment No. 61 (File No.
2-58774).
 
 7. (a) Retirement Plan for Non-Interested Person Trustees, Directors or
General Partners, as amended on November 16, 1995, is incorporated herein
by reference to Exhibit 7(a) of Fidelity Select Portfolio's (File No.
2-69972) Post-Effective Amendment No. 54.
  (b) The Fee Deferrral Plan for Non-Interested Person Directors and
Trustees of the Fidelity Funds, effective as of December 1, 1995, is
incorporated herein by reference to Exhibit 7(b) of Fidelity School Street
Trust's (File No. 2-57167) Post-Effective Amendment No. 47.
 8. (a) Custodian Agreement and Appendix C, dated December 1, 1994, between
The Bank of New York and the Registrant is incorporated herein by reference
to Exhibit 8(a) to Fidelity Hereford Street Trust's Post-Effective
Amendment No. 4 (File No. 33-52577).
  (b) Appendix A, dated August 31, 1996, to the Custodian Agreement, dated
December 1, 1994, between The Bank of New York and the Registrant is
incorporated herein by reference to Exhibit 8 (b) of Daily Money Fund's
Post-Effective Amendment No. 40 (File No. 2-77909).
  (c) Appendix B, dated July 31, 1996, to the Custodian Agreement dated
December 1, 1994, between The Bank of New York and the Registrant is
incorporated herein by reference to Exhibit 8 (c) of Fidelity Income Fund's
Post-Effective Amendment No. 35 (File No. 2-92661)
  (d) Fidelity Group Repo Custodian Agreement among The Bank of New York,
J. P. Morgan Securities, Inc., and the Registrant, dated February 12, 1996,
is incorporated herein by reference to Exhibit 8(d) of Fidelity
Institutional Cash Portfolios' (File No. 2-74808) Post-Effective Amendment
No. 31.
  (e) Schedule 1 to the Fidelity Group Repo Custodian Agreement between The
Bank of New York and the Registrant, dated February 12, 1996, is
incorporated herein by reference to Exhibit 8(e) of Fidelity Institutional
Cash Portfolios' (File No. 2-74808) Post-Effective Amendment No. 31.
  (f) Fidelity Group Repo Custodian Agreement among Chemical Bank,
Greenwich Capital Markets, Inc., and the Registrant, dated November 13,
1995, is incorporated herein by reference to Exhibit 8(f) of Fidelity
Institutional Cash Portfolios' (File No. 2-74808) Post-Effective Amendment
No. 31.
  (g) Schedule 1 to the Fidelity Group Repo Custodian Agreement between
Chemical Bank and the Registrant, dated November 13, 1995, is incorporated
herein by reference to Exhibit 8(g) of Fidelity Institutional Cash
Portfolios' (File No. 2-74808) Post-Effective Amendment No. 31.
  (h) Joint Trading Account Custody Agreement between The Bank of New York
and Fidelity Phillips Street Trust on behalf of Fidelity Cash Reserves,
dated May 11, 1995, is incorporated herein by reference to Exhibit 8(h) of
Fidelity Institutional Cash Portfolios' (File No. 2-74808) Post-Effective
Amendment No. 31.
  (i) First Amendment to Joint Trading Account Custody Agreement between
The Bank of New York and Fidelity Phillips Street Trust on behalf of
Fidelity Cash Reserves, dated July 14, 1995, is incorporated herein by
reference to Exhibit 8(i) of Fidelity Institutional Cash Portfolios' (File
No. 2-74808) Post-Effective Amendment No. 31.
 9. Not applicable.
 10. Not applicable.
 11 a. Consent of Coopers & Lybrand L.L.P. is filed herein as Exhibit 11a.
 
  b Consent of Price Waterhouse LLP is filed herein as Exhibit 11b.
 
 12. Not applicable.
 13. Not applicable.
 14. (a) Fidelity Individual Retirement Account Custodial Agreement and
Disclosure Statement, as currently in effect, is incorporated herein by
reference to Exhibit 14(a) of Fidelity Union Street Trust's (File No.
2-50318) Post-Effective Amendment No. 87.
     (b) Fidelity Institutional Individual Retirement Account Custodial
Agreement and Disclosure Statement, as currently in effect, is incorporated
herein by reference to Exhibit 14(d) of Fidelity Union Street Trust's (File
No. 2-50318) Post-Effective Amendment No. 87.
     (c) National Financial Services Corporation Individual Retirement
Account Custodial Agreement and Disclosure Statement, as currently in
effect, is incorporated herein by reference to Exhibit 14(h) of Fidelity
Union Street Trust's (File No. 2-50318) Post-Effective Amendment No. 87.
     (d) Fidelity Portfolio Advisory Services Individual Retirement Account
Custodial Agreement and Disclosure Statement, as currently in effect, is
incorporated herein by reference to Exhibit 14(i) of Fidelity Union Street
Trust's (File No. 2-50318) Post-Effective Amendment No. 87.
     (e) Fidelity 403(b)(7) Custodial Account Agreement, as currently in
effect, is incorporated herein by reference to Exhibit 14(e) of Fidelity
Union Street Trust's (File No. 2-50318) Post-Effective Amendment No. 87.
     (f) National Financial Services Corporation Defined Contribution
Retirement Plan and Trust Agreement, as currently in effect, is
incorporated herein by reference to Exhibit 14(k) of Fidelity Union Street
Trust's (File No. 2-50318) Post-Effective Amendment No. 87.
     (g) The CORPORATEplan for Retirement Profit Sharing/401K Plan, as
currently in effect, is incorporated herein by reference to Exhibit 14(l)
of Fidelity Union Street Trust's (File No. 2-50318) Post-Effective
Amendment No. 87.
     (h) The CORPORATEplan for Retirement Money Purchase Pension Plan, as
currently in effect, is incorporated herein by reference to Exhibit 14(m)
of Fidelity Union Street Trust's (File No. 2-50318) Post-Effective
Amendment No. 87.
     (i) Fidelity Investments Section 403(b)(7) Individual Custodial
Account Agreement and Disclosure Statement, as currently in effect, is
incorporated herein by reference to Exhibit 14(f) of Fidelity Commonwealth
Trust's (File No. 2-52322) Post-Effective Amendment No. 57.
     (j) Plymouth Investments Defined Contribution Retirement Plan and
Trust Agreement, as currently in effect, is incorporated herein by
reference to Exhibit 14(o) of Fidelity Commonwealth Trust's (File No.
2-52322) Post-Effective Amendment No. 57.
     (k) The Fidelity Prototype Defined Benefit Pension Plan and Trust
Basic Plan Document and Adoption Agreement, as currently in effect, is
incorporated herein by reference to Exhibit 14(d) of Fidelity Securities
Fund's (File No. 2-93601) Post-Effective Amendment No. 33.
     (l) The Institutional Prototype Plan Basic Plan Document, Standardized
Adoption Agreement, and Non-Standardized Adoption Agreement, as currently
in effect, is incorporated herein by reference to Exhibit 14(o) of Fidelity
Securities Fund's (File No. 2-93601) Post-Effective Amendment No. 33.
     (m) The CORPORATEplan for Retirement 100SM Profit Sharing/401(k) Basic
Plan Document, Standardized Adoption Agreement, and Non-Standardized
Adoption Agreement, as currently in effect, is incorporated herein by
reference to Exhibit 14(f) of Fidelity Securities Fund's (File No. 2-93601)
Post-Effective Amendment No. 33.
     (n) The Fidelity Investments 401(a) Prototype Plan for Tax-Exempt
Employers Basic Plan Document, Standardized Profit Sharing Plan Adoption
Agreement, Non-Standardized Discretionary Contribution Plan No. 002
Adoption Agreement, and Non-Standardized Discretionary Contribution Plan
No. 003 Adoption Agreement, as currently in effect, is incorporated herein
by reference to Exhibit 14(g) of Fidelity Securities Fund's (File No.
2-93601) Post-Effective Amendment No. 33.
     (o) Fidelity Investments 403(b) Sample Plan Basic Plan Document and
Adoption Agreement, as currently in effect, is incorporated herein by
reference to Exhibit 14(p) of Fidelity Securities Fund's (File No. 2-93601)
Post-Effective Amendment No. 33.
     (p) Fidelity Defined Contribution Retirement Plan and Trust Agreement,
as currently in effect, is incorporated herein by reference to Exhibit
14(c) of Fidelity Securities Fund's (File No. 2-93601) Post-Effective
Amendment No. 33.
 15. (a) Distribution and Service Plan between Fidelity Cash Reserves and
Fidelity Distributors  Corporation is incorporated herein by reference to
Exhibit 15(a) to Post-Effective   Amendment No. 39.
     (b) Distribution and Service Plan between Fidelity U.S. Government
Reserves and Fidelity Distributors Corporation is incorporated by reference
to Exhibit 15(b) to Post Effective Amendment No. 40.
 16. A revised schedule for computation of performance calculations for
Fidelity Cash Reserves is incorporated herein by reference as Exhibit 16 to
Post-Effective No. 39.
 17. Financial data schedules are filed herein as Exhibit 27.
          18.      Not applicable.
Item 25. Persons Controlled by or under Common Control with Registrant
 The Board of Trustees of Registrant is substantially the same as the Board
of Trustees of other funds advised by FMR, each of which has Fidelity
Management and Research Company as its investment adviser. In addition, the
officers of these funds are substantially identical.  Nonetheless,
Registrant takes the position that it is not under common control with
these other funds since the power residing in the respective boards and
officers arises as the result of an official position with the respective
funds.
Item 26. Number of Holders of Securities as of November 30, 1996
Title of Class:  Shares of Beneficial Interest
 Name of Series Number of Record Holders
 Fidelity Cash Reserves 1,328,776
 Fidelity U.S. Government Reserves      83,040
Item 27. Indemnification
 Pursuant to Del. Code Ann. title 12 (sub-section) 3817, a Delaware
business trust may provide in its governing instrument for the
indemnification of its officers and trustees from and against any and all
claims and demands whatsoever. Article X, Section 10.02 of the Trust
Instrument states that the Registrant shall indemnify any present trustee
or officer to the fullest extent permitted by law against liability, and
all expenses reasonably incurred by him or her in connection with any
claim, action, suit or proceeding in which he or she is involved by virtue
of his or her service as a trustee, officer, or both, and against any
amount incurred in settlement thereof. Indemnification will not be provided
to a person adjudged by a court or other adjudicatory body to be liable to
the Registrant or its shareholders by reason of willful misfeasance, bad
faith, gross negligence or reckless disregard of his or her duties
(collectively, "disabling conduct"), or not to have acted in good faith in
the reasonable belief that his or her action was in the best interest of
the Registrant. In the event of a settlement, no indemnification may be
provided unless there has been a determination, as specified in the Trust
Instrument, that the officer or trustee did not engage in disabling
conduct.
 Pursuant to Section 11 of the Distribution Agreement, the Registrant
agrees to indemnify and hold harmless the Distributor and each of its
directors and officers and each person, if any, who controls the
Distributor within the meaning of Section 15 of the 1933 Act against any
loss, liability, claim, damages or expense arising by reason of any person
acquiring any shares, based upon the ground that the registration
statement, Prospectus, Statement of Additional Information, shareholder
reports or other information filed or made public by the Registrant
included a materially misleading statement or omission. However, the
Registrant does not agree to indemnify the Distributor or hold it harmless
to the extent that the statement or omission was made in reliance upon, and
in conformity with, information furnished to the Registrant by or on behalf
of the Distributor. The Registrant does not agree to indemnify the parties
against any liability to which they would be subject by reason of their own
disabling conduct.
 Pursuant to the agreement by which Fidelity Service Company, Inc.
("Service") is appointed transfer agent, the Registrant agrees to indemnify
and hold Service harmless against any losses, claims, damages, liabilities
or expenses (including reasonable counsel fees and expenses) resulting
from:
 (1) any claim, demand, action or suit brought by any person other than the
Registrant, including by a shareholder, which names Service and/or the
Registrant as a party and is not based on and does not result from the
Service's willful misfeasance, bad faith or negligence or reckless
disregard of duties, and arises out of or in connection with Service's
performance under the Transfer Agency Agreement; or
 (2) any claim, demand, action or suit (except to the extent contributed to
by Service's willful misfeasance, bad faith or negligence or reckless
disregard of duties) which results from the negligence of the Registrant,
or from Service's acting upon any instruction(s) reasonably believed by it
to have been executed or communicated by any person duly authorized by the
Registrant, or as a result of Service's acting in reliance upon advice
reasonably believed by Service to have been given by counsel for the
Registrant, or as a result of Service's acting in reliance upon any
instrument or stock certificate reasonably believed by it to have been
genuine and signed, countersigned or executed by the proper person.
Item 28. Business and Other Connections of Investment Adviser
 (1)  FIDELITY MANAGEMENT & RESEARCH COMPANY (FMR)
 FMR serves as investment adviser to a number of other investment
companies.  The directors and officers of the Adviser have held, during the
past two fiscal years, the following positions of a substantial nature.
 
<TABLE>
<CAPTION>
<S>                         <C>                                                      
Edward C. Johnson 3d        Chairman of the Executive Committee of FMR;              
                            President and Chief Executive Officer of FMR Corp.;      
                            Chairman of the Board and Director of FMR, FMR           
                            Corp., FMR Texas Inc., FMR (U.K.) Inc., and FMR          
                            (Far East) Inc.; Chairman of the Board and               
                            Representative Director of Fidelity Investments Japan    
                            Limited; President and Trustee of funds advised by       
                            FMR.                                                     
 
                                                                                     
 
J. Gary Burkhead            President and Director of FMR, FMR Texas Inc., FMR       
                            (U.K.) Inc., and FMR (Far East) Inc.; Managing           
                            Director of FMR Corp.; Senior Vice President and         
                            Trustee of funds advised by FMR.                         
 
                                                                                     
 
Peter S. Lynch              Vice Chairman of the Board and Director of FMR.          
 
                                                                                     
 
Marta Amieva                Vice President of FMR.                                   
 
                                                                                     
 
Dwight D. Churchill         Vice President of FMR.                                   
 
                                                                                     
 
John D. Crumrine            Assistant Treasurer of FMR, FMR (U.K.) Inc., FMR         
                            (Far East) Inc., and FMR Texas Inc.; Vice President      
                            and Treasurer of FMR Corp.                               
 
                                                                                     
 
William Danoff              Vice President of FMR and of a fund advised by FMR.      
 
                                                                                     
 
Scott E. DeSano             Vice President of FMR.                                   
 
                                                                                     
 
Craig P. Dinsell            Vice President of FMR.                                   
 
                                                                                     
 
Penelope Dobkin             Vice President of FMR and of a fund advised by FMR.      
 
                                                                                     
 
George C. Domolky           Vice President of FMR.                                   
 
                                                                                     
 
Larry A. Domash             Vice President of FMR.                                   
 
                                                                                     
 
Bettina Doulton             Vice President of FMR and of funds advised by FMR.       
 
                                                                                     
 
Margaret L. Eagle           Vice President of FMR and a fund advised by FMR.         
 
                                                                                     
 
Richard B. Fentin           Senior Vice President of FMR and Vice President of a     
                            fund advised by FMR.                                     
 
                                                                                     
 
Gregory Fraser              Vice President of FMR and of a fund advised by FMR.      
 
                                                                                     
 
Jay Freedman                Assistant Clerk of FMR; Clerk of FMR Corp., FMR          
                            (U.K.) Inc., and FMR (Far East) Inc.; Secretary of       
                            FMR Texas Inc.                                           
 
                                                                                     
 
Robert Gervis               Vice President of FMR.                                   
 
                                                                                     
 
David L. Glancy             Vice President of FMR and of a fund advised by FMR.      
 
                                                                                     
 
Kevin E. Grant              Vice President of FMR and of funds advised by FMR.       
 
                                                                                     
 
Michael S. Gray             Vice President of FMR and of funds advised by FMR.       
 
                                                                                     
 
Barry A. Greenfield         Vice President of FMR and of a fund advised by FMR.      
 
                                                                                     
 
Boyce I. Greer              Vice President of FMR.                                   
 
                                                                                     
 
Bart Grenier                Vice President of FMR.                                   
 
                                                                                     
 
Robert Haber                Vice President of FMR.                                   
 
                                                                                     
 
Richard C. Habermann        Senior Vice President of FMR; Vice President of funds    
                            advised by FMR.                                          
 
                                                                                     
 
William J. Hayes            Senior Vice President of FMR; Vice President of          
                            Equity funds advised by FMR.                             
 
                                                                                     
 
Richard Hazlewood           Vice President of FMR and of a fund advised by FMR.      
 
                                                                                     
 
Fred L. Henning Jr.         Senior Vice President of FMR; Vice President of          
                            Fixed-Income funds advised by FMR.                       
 
                                                                                     
 
John R. Hickling            Vice President of FMR and of a fund advised by FMR.      
 
                                                                                     
 
Robert F. Hill              Vice President of FMR; Director of Technical             
                            Research.                                                
 
                                                                                     
 
Curt Hollingsworth          Vice President of FMR and of funds advised by FMR.       
 
                                                                                     
 
Abigail P. Johnson          Vice President of FMR and of a fund advised by FMR.      
 
                                                                                     
 
Stephen P. Jonas            Vice President of FMR; Treasurer of FMR, FMR             
                            (U.K.) Inc., FMR (Far East) Inc., and FMR Texas Inc.     
 
                                                                                     
 
David B. Jones              Vice President of FMR.                                   
 
                                                                                     
 
Steven Kaye                 Vice President of FMR and of a fund advised by FMR.      
 
                                                                                     
 
Francis V. Knox             Vice President of FMR; Compliance Officer of FMR         
                            (U.K.) Inc.                                              
 
                                                                                     
 
David P. Kurrasch           Vice President of FMR.                                   
 
                                                                                     
 
Robert A. Lawrence          Senior Vice President of FMR; Vice President of High     
                            Income funds advised by FMR.                             
 
                                                                                     
 
Alan Leifer                 Vice President of FMR.                                   
 
                                                                                     
 
Harris Leviton              Vice President of FMR and of a fund advised by FMR.      
 
                                                                                     
 
Bradford E. Lewis           Vice President of FMR and of funds advised by FMR.       
 
                                                                                     
 
Arthur S. Loring            Senior Vice President, Clerk, and General Counsel of     
                            FMR; Vice President/Legal, and Assistant Clerk of        
                            FMR Corp.; Secretary of funds advised by FMR.            
 
                                                                                     
 
Richard R. Mace Jr.         Vice President of FMR and of funds advised by FMR.       
 
                                                                                     
 
Malcolm W. MacNaught II     Vice President of FMR and of a fund advised by FMR.      
 
                                                                                     
 
Robert H. Morrison          Vice President of FMR; Director of Equity Trading.       
 
                                                                                     
 
David L. Murphy             Vice President of FMR and of funds advised by FMR.       
 
                                                                                     
 
Jacques Perold              Vice President of FMR.                                   
 
                                                                                     
 
Anne Punzak                 Vice President of FMR.                                   
 
                                                                                     
 
Kenneth A. Rathgeber        Vice President of FMR; Treasurer of funds advised by     
                            FMR.                                                     
 
                                                                                     
 
Lee H. Sandwen              Vice President of FMR.                                   
 
                                                                                     
 
Patricia A. Satterthwaite   Vice President of FMR and of a fund advised by FMR.      
 
                                                                                     
 
Thomas T. Soviero           Vice President of FMR and of a fund advised by FMR.      
 
                                                                                     
 
Richard Spillane            Vice President of FMR; Senior Vice President and         
                            Director of Operations and Compliance of FMR (U.K.)      
                            Inc.                                                     
 
                                                                                     
 
Robert E. Stansky           Senior Vice President of FMR; Vice President of a        
                            fund advised by FMR.                                     
 
                                                                                     
 
Thomas Sweeney              Vice President of FMR and of a fund advised by FMR.      
 
                                                                                     
 
Beth F. Terrana             Senior Vice President of FMR; Vice President of a        
                            fund advised by FMR.                                     
 
                                                                                     
 
Yoko Tilley                 Vice President of FMR.                                   
 
                                                                                     
 
Joel C. Tillinghast         Vice President of FMR and of a fund advised by FMR.      
 
                                                                                     
 
Robert Tuckett              Vice President of FMR.                                   
 
                                                                                     
 
Jennifer Uhrig              Vice President of FMR and of  funds advised by FMR.      
 
                                                                                     
 
George A. Vanderheiden      Senior Vice President of FMR; Vice President of funds    
                            advised by FMR.                                          
 
</TABLE>
 
(2)  FMR TEXAS INC. (FMR Texas)
 FMR Texas provides investment advisory services to Fidelity Management &
Research Company.  The directors and officers of the Sub-Adviser have held
the following positions of a substantial nature during the past two fiscal
years.
Edward C. Johnson 3d   Chairman of the Board and Director of FMR          
                       Texas, FMR, FMR Corp., FMR (Far East) Inc.,        
                       and FMR (U.K.) Inc.; Chairman of the               
                       Executive Committee of FMR; President and          
                       Chief Executive Officer of FMR Corp.;              
                       Chairman of the Board and Representative           
                       Director of Fidelity Investments Japan Limited;    
                       President and Trustee of funds advised by FMR.     
 
                                                                          
 
J. Gary Burkhead       President and Director of FMR Texas, FMR,          
                       FMR (Far East) Inc., and FMR (U.K.) Inc.;          
                       Managing Director of FMR Corp.; Senior Vice        
                       President and Trustee of funds advised by FMR.     
 
                                                                          
 
Robert H. Auld         Vice President of FMR Texas.                       
 
                                                                          
 
Leland C. Barron       Vice President of FMR Texas and of funds           
                       advised by FMR.                                    
 
                                                                          
 
Robert K. Duby         Vice President of FMR Texas and of funds           
                       advised by FMR.                                    
 
                                                                          
 
Robert Litterst        Vice President of FMR Texas and of funds           
                       advised by FMR.                                    
 
                                                                          
 
Thomas D. Maher        Vice President of FMR Texas and Assistant Vice     
                       President of Money Market funds advised by         
                       FMR.                                               
 
                                                                          
 
Scott A. Orr           Vice President of FMR Texas and of funds           
                       advised by FMR.                                    
 
                                                                          
 
Burnell R. Stehman     Vice President of FMR Texas and of funds           
                       advised by FMR.                                    
 
                                                                          
 
John J. Todd           Vice President of FMR Texas and of funds           
                       advised by FMR.                                    
 
                                                                          
 
Sarah H. Zenoble       Vice President of FMR Texas and of Money           
                       Market funds advised by FMR.                       
 
                                                                          
 
Stephen P. Jonas       Treasurer of FMR Texas, FMR (U.K.) Inc.,           
                       FMR (Far East) Inc., and FMR; Vice President       
                       of FMR.                                            
 
                                                                          
 
John D. Crumrine       Assistant Treasurer of FMR Texas, FMR (U.K.)       
                       Inc., FMR (Far East) Inc., and FMR; Vice           
                       President and Treasurer of FMR Corp.               
 
                                                                          
 
Jay Freedman           Secretary of FMR Texas; Clerk of FMR (U.K.)        
                       Inc., FMR (Far East) Inc., and FMR Corp.;          
                       Assistant Clerk of FMR.                            
 
Item 29. Principal Underwriters
(a) Fidelity Distributors Corporation (FDC) acts as distributor for most
funds advised by FMR.
(b)                                                                  
 
Name and Principal   Positions and Offices   Positions and Offices   
 
Business Address*    With Underwriter        With Registrant         
 
Edward C. Johnson 3d   Director                   Trustee and President   
 
Michael Mlinac         Director                   None                    
 
Mark Peterson          Director                   None                    
 
Paul Hondros           President                  None                    
 
Arthur S. Loring       Vice President and Clerk   Secretary               
 
Caron Ketchum          Treasurer and Controller   None                    
 
Gary Greenstein        Assistant Treasurer        None                    
 
Jay Freedman           Assistant Clerk            None                    
 
Linda Holland          Compliance Officer         None                    
 
* 82 Devonshire Street, Boston, MA
 (c) Not applicable.
Item 30. Location of Accounts and Records
 All accounts, books, and other documents required to be maintained by
Section 31a of the 1940 Act and the Rules promulgated thereunder are
maintained by Fidelity Management & Research Company or Fidelity Service
Company, Inc., 82 Devonshire Street, Boston, MA 02109, or the funds 
custodian The Bank of New York, 110 Washington Street, New York, N.Y.
 
Item 31. Management Services
  not applicable
Item 32. Undertakings
  not applicable
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it meets all
of the requirements for the effectiveness of this Registration Statement
pursuant to Rule 485(b) under the Securities Act of 1933 and has duly
caused this Post-Effective Amendment No. 41 to the Registration Statement
to be signed on its behalf by the undersigned, thereunto duly authorized,
in the City of Boston, and state of Massachusetts, on the 16th day of
January 1997.
      FIDELITY PHILLIPS STREET TRUST
      By /s/Edward C. Johnson 3d          (dagger)
           Edward C. Johnson 3d, President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in
the capacities and on the dates indicated.
       (Signature)   (Title)   (Date)   
 
 
<TABLE>
<CAPTION>
<S>                                  <C>                             <C>                
/s/Edward C. Johnson 3d  (dagger)    President and Trustee           January 16, 1997   
 
Edward C. Johnson 3d                 (Principal Executive Officer)                      
 
                                                                                        
 
/s/Kenneth A. Rathgeber     *        Treasurer                       January 16, 1997   
 
Kenneth A. Rathgeber                                                                    
 
                                                                                        
 
/s/J. Gary Burkhead                  Trustee                         January 16, 1997   
 
J. Gary Burkhead                                                                        
 
                                                                                        
 
/s/Ralph F. Cox                 **   Trustee                         January 16, 1997   
 
Ralph F. Cox                                                                            
 
                                                                                        
 
/s/Phyllis Burke Davis      **       Trustee                         January 16, 1997   
 
Phyllis Burke Davis                                                                     
 
                                                                                        
 
/s/E. Bradley Jones           **     Trustee                         January 16, 1997   
 
E. Bradley Jones                                                                        
 
                                                                                        
 
/s/Donald J. Kirk               **   Trustee                         January 16, 1997   
 
Donald J. Kirk                                                                          
 
                                                                                        
 
/s/Peter S. Lynch               **   Trustee                         January 16, 1997   
 
Peter S. Lynch                                                                          
 
                                                                                        
 
/s/Marvin L. Mann            **      Trustee                         January 16, 1997   
 
Marvin L. Mann                                                                          
 
                                                                                        
 
/s/William O. McCoy        **        Trustee                         January 16, 1997   
 
William O. McCoy                                                                        
 
                                                                                        
 
/s/Gerald C. McDonough  **           Trustee                         January 16, 1997   
 
Gerald C. McDonough                                                                     
 
                                                                                        
 
/s/Thomas R. Williams       **       Trustee                         January 16, 1997   
 
Thomas R. Williams                                                                      
 
                                                                                        
 
</TABLE>
 
(dagger) Signatures affixed by J. Gary Burkhead pursuant to a power of
attorney dated January 3, 1997 and filed herewith.
* Signature affixed by John H. Costello pursuant to a power of attorney
dated December 19, 1996 and filed herewith.
** Signature affixed by Robert C. Hacker pursuant to a power of attorney
dated December 19, 1996 and filed herewith. 
POWER OF ATTORNEY
 I, the undersigned President and Director, Trustee, or General Partner, as
the case may be, of the following investment companies:
 
<TABLE>
<CAPTION>
<S>                                      <C>                                                 
Fidelity Aberdeen Street Trust           Fidelity Government Securities Fund                 
Fidelity Advisor Annuity Fund            Fidelity Hastings Street Trust                      
Fidelity Advisor Series I                Fidelity Hereford Street Trust                      
Fidelity Advisor Series II               Fidelity Income Fund                                
Fidelity Advisor Series III              Fidelity Institutional Cash Portfolios              
Fidelity Advisor Series IV               Fidelity Institutional Tax-Exempt Cash Portfolios   
Fidelity Advisor Series V                Fidelity Institutional Trust                        
Fidelity Advisor Series VI               Fidelity Investment Trust                           
Fidelity Advisor Series VII              Fidelity Magellan Fund                              
Fidelity Advisor Series VIII             Fidelity Massachusetts Municipal Trust              
Fidelity Beacon Street Trust             Fidelity Money Market Trust                         
Fidelity Boston Street Trust             Fidelity Mt. Vernon Street Trust                    
Fidelity California Municipal Trust      Fidelity Municipal Trust                            
Fidelity California Municipal Trust II   Fidelity Municipal Trust II                         
Fidelity Capital Trust                   Fidelity New York Municipal Trust                   
Fidelity Charles Street Trust            Fidelity New York Municipal Trust II                
Fidelity Commonwealth Trust              Fidelity Phillips Street Trust                      
Fidelity Congress Street Fund            Fidelity Puritan Trust                              
Fidelity Contrafund                      Fidelity Revere Street Trust                        
Fidelity Corporate Trust                 Fidelity School Street Trust                        
Fidelity Court Street Trust              Fidelity Securities Fund                            
Fidelity Court Street Trust II           Fidelity Select Portfolios                          
Fidelity Covington Trust                 Fidelity Sterling Performance Portfolio, L.P.       
Fidelity Daily Money Fund                Fidelity Summer Street Trust                        
Fidelity Daily Tax-Exempt Fund           Fidelity Trend Fund                                 
Fidelity Destiny Plans                   Fidelity U.S. Investments-Bond Fund, L.P.           
Fidelity Destiny Portfolios              Fidelity U.S. Investments-Government Securities     
Fidelity Deutsche Mark Performance          Fund, L.P.                                       
  Portfolio, L.P.                        Fidelity Union Street Trust                         
Fidelity Devonshire Trust                Fidelity Union Street Trust II                      
Fidelity Exchange Fund                   Fidelity Yen Performance Portfolio, L.P.            
Fidelity Financial Trust                 Variable Insurance Products Fund                    
Fidelity Fixed-Income Trust              Variable Insurance Products Fund II                 
 
</TABLE>
 
plus any other investment company for which Fidelity Management & Research
Company or an affiliate acts as investment adviser and for which the
undersigned individual serves as President and Director, Trustee, or
General Partner (collectively, the "Funds"), hereby constitute and appoint
J. Gary Burkhead my true and lawful attorney-in-fact, with full power of
substitution, and with full power to him to sign for me and in my name in
the appropriate capacity, all Registration Statements of the Funds on Form
N-1A, Form N-8A, Form N-8B-2, or any successor thereto, any and all
subsequent Amendments, Pre-Effective Amendments, or Post-Effective
Amendments to said Registration Statements on Form N-1A or any successor
thereto, any Registration Statements on Form N-14, and any supplements or
other instruments in connection therewith, and generally to do all such
things in my name and behalf in connection therewith as said
attorney-in-fact deems necessary or appropriate, to comply with the
provisions of the Securities Act of 1933 and the Investment Company Act of
1940, and all related requirements of the Securities and Exchange
Commission.  I hereby ratify and confirm all that said attorney-in-fact or
his substitutes may do or cause to be done by virtue hereof.  This power of
attorney is effective for all documents filed on or after January 3, 1997.
 WITNESS my hand on the date set forth below.
/s/Edward C. Johnson 3d              January 3, 1997   
 
Edward C. Johnson 3d                                   
 
POWER OF ATTORNEY
 I, the undersigned Treasurer and principal financial and accounting
officer of the following investment companies:
 
<TABLE>
<CAPTION>
<S>                                      <C>                                                 
Fidelity Aberdeen Street Trust           Fidelity Government Securities Fund                 
Fidelity Advisor Annuity Fund            Fidelity Hastings Street Trust                      
Fidelity Advisor Series I                Fidelity Hereford Street Trust                      
Fidelity Advisor Series II               Fidelity Income Fund                                
Fidelity Advisor Series III              Fidelity Institutional Cash Portfolios              
Fidelity Advisor Series IV               Fidelity Institutional Tax-Exempt Cash Portfolios   
Fidelity Advisor Series V                Fidelity Institutional Trust                        
Fidelity Advisor Series VI               Fidelity Investment Trust                           
Fidelity Advisor Series VII              Fidelity Magellan Fund                              
Fidelity Advisor Series VIII             Fidelity Massachusetts Municipal Trust              
Fidelity Beacon Street Trust             Fidelity Money Market Trust                         
Fidelity Boston Street Trust             Fidelity Mt. Vernon Street Trust                    
Fidelity California Municipal Trust      Fidelity Municipal Trust                            
Fidelity California Municipal Trust II   Fidelity Municipal Trust II                         
Fidelity Capital Trust                   Fidelity New York Municipal Trust                   
Fidelity Charles Street Trust            Fidelity New York Municipal Trust II                
Fidelity Commonwealth Trust              Fidelity Phillips Street Trust                      
Fidelity Congress Street Fund            Fidelity Puritan Trust                              
Fidelity Contrafund                      Fidelity Revere Street Trust                        
Fidelity Corporate Trust                 Fidelity School Street Trust                        
Fidelity Court Street Trust              Fidelity Securities Fund                            
Fidelity Court Street Trust II           Fidelity Select Portfolios                          
Fidelity Covington Trust                 Fidelity Sterling Performance Portfolio, L.P.       
Fidelity Daily Money Fund                Fidelity Summer Street Trust                        
Fidelity Daily Tax-Exempt Fund           Fidelity Trend Fund                                 
Fidelity Destiny Portfolios              Fidelity U.S. Investments-Bond Fund, L.P.           
Fidelity Deutsche Mark Performance       Fidelity U.S. Investments-Government Securities     
  Portfolio, L.P.                           Fund, L.P.                                       
Fidelity Devonshire Trust                Fidelity Union Street Trust                         
Fidelity Exchange Fund                   Fidelity Union Street Trust II                      
Fidelity Financial Trust                 Fidelity Yen Performance Portfolio, L.P.            
Fidelity Fixed-Income Trust              Variable Insurance Products Fund                    
                                         Variable Insurance Products Fund II                 
 
</TABLE>
 
plus any other investment company for which Fidelity Management & Research
Company or an affiliate acts as investment adviser and for which the
undersigned individual serves as President and Director, Trustee, or
General Partner (collectively, the "Funds"), hereby constitute and appoint
John H. Costello and John E. Ferris each of them singly my true and lawful
attorneys-in-fact, with full power of substitution, and with full power to
each of them to sign for me and in my name in the appropriate capacity, all
Registration Statements of the Funds on Form N-1A, Form N-8A or any
successor thereto, any and all subsequent Amendments, Pre-Effective
Amendments, or Post-Effective Amendments to said Registration Statements on
Form N-1A or any successor thereto, any Registration Statements on Form
N-14, and any supplements or other instruments in connection therewith, and
generally to do all such things in my name and behalf in connection
therewith as said attorneys-in-fact deems necessary or appropriate, to
comply with the provisions of the Securities Act of 1933 and the Investment
Company Act of 1940, and all related requirements of the Securities and
Exchange Commission.  I hereby ratify and confirm all that said
attorneys-in-fact or their substitutes may do or cause to be done by virtue
hereof.   This power of attorney is effective for all documents filed on or
after January 1, 1997.
 WITNESS my hand on the date set forth below.
/s/Kenneth A. Rathgeber__________   December 19, 1996   
 
Kenneth A. Rathgeber                                    
 
POWER OF ATTORNEY
 We, the undersigned Directors, Trustees, or General Partners, as the case
may be, of the following investment companies:
 
<TABLE>
<CAPTION>
<S>                                      <C>                                                 
Fidelity Aberdeen Street Trust           Fidelity Government Securities Fund                 
Fidelity Advisor Annuity Fund            Fidelity Hastings Street Trust                      
Fidelity Advisor Series I                Fidelity Hereford Street Trust                      
Fidelity Advisor Series II               Fidelity Income Fund                                
Fidelity Advisor Series III              Fidelity Institutional Cash Portfolios              
Fidelity Advisor Series IV               Fidelity Institutional Tax-Exempt Cash Portfolios   
Fidelity Advisor Series V                Fidelity Institutional Trust                        
Fidelity Advisor Series VI               Fidelity Investment Trust                           
Fidelity Advisor Series VII              Fidelity Magellan Fund                              
Fidelity Advisor Series VIII             Fidelity Massachusetts Municipal Trust              
Fidelity Beacon Street Trust             Fidelity Money Market Trust                         
Fidelity Boston Street Trust             Fidelity Mt. Vernon Street Trust                    
Fidelity California Municipal Trust      Fidelity Municipal Trust                            
Fidelity California Municipal Trust II   Fidelity Municipal Trust II                         
Fidelity Capital Trust                   Fidelity New York Municipal Trust                   
Fidelity Charles Street Trust            Fidelity New York Municipal Trust II                
Fidelity Commonwealth Trust              Fidelity Phillips Street Trust                      
Fidelity Congress Street Fund            Fidelity Puritan Trust                              
Fidelity Contrafund                      Fidelity Revere Street Trust                        
Fidelity Corporate Trust                 Fidelity School Street Trust                        
Fidelity Court Street Trust              Fidelity Securities Fund                            
Fidelity Court Street Trust II           Fidelity Select Portfolios                          
Fidelity Covington Trust                 Fidelity Sterling Performance Portfolio, L.P.       
Fidelity Daily Money Fund                Fidelity Summer Street Trust                        
Fidelity Daily Tax-Exempt Fund           Fidelity Trend Fund                                 
Fidelity Destiny Portfolios              Fidelity U.S. Investments-Bond Fund, L.P.           
Fidelity Deutsche Mark Performance       Fidelity U.S. Investments-Government Securities     
  Portfolio, L.P.                           Fund, L.P.                                       
Fidelity Devonshire Trust                Fidelity Union Street Trust                         
Fidelity Exchange Fund                   Fidelity Union Street Trust II                      
Fidelity Financial Trust                 Fidelity Yen Performance Portfolio, L.P.            
Fidelity Fixed-Income Trust              Variable Insurance Products Fund                    
                                         Variable Insurance Products Fund II                 
 
</TABLE>
 
plus any other investment company for which Fidelity Management & Research
Company or an affiliate acts as investment adviser and for which the
undersigned individual serves as Directors, Trustees, or General Partners
(collectively, the "Funds"), hereby constitute and appoint Arthur J. Brown,
Arthur C. Delibert, Stephanie A. Djinis, Robert C. Hacker, Thomas M.
Leahey, Richard M. Phillips, and Dana L. Platt, each of them singly, our
true and lawful attorneys-in-fact, with full power of substitution, and
with full power to each of them, to sign for us and in our names in the
appropriate capacities, all Registration Statements of the Funds on Form
N-1A, Form N-8A or any successor thereto, any and all subsequent
Amendments, Pre-Effective Amendments, or Post-Effective Amendments to said
Registration Statements on Form N-1A or any successor thereto, any
Registration Statements on Form N-14, and any supplements or other
instruments in connection therewith, and generally to do all such things in
our names and behalf in connection therewith as said attorneys-in-fact
deems necessary or appropriate, to comply with the provisions of the
Securities Act of 1933 and the Investment Company Act of 1940, and all
related requirements of the Securities and Exchange Commission.  I hereby
ratify and confirm all that said attorneys-in-fact or their substitutes may
do or cause to be done by virtue hereof.  This power of attorney is
effective for all documents filed on or after January 1, 1997.
 WITNESS our hands on this nineteenth day of December, 1996.
 
/s/Edward C. Johnson 3d___________    /s/Peter S. Lynch________________    
 
Edward C. Johnson 3d                  Peter S. Lynch                       
                                                                           
                                                                           
                                                                           
 
/s/J. Gary Burkhead_______________    /s/William O. McCoy______________    
 
J. Gary Burkhead                      William O. McCoy                     
                                                                           
 
/s/Ralph F. Cox __________________   /s/Gerald C. McDonough___________    
 
Ralph F. Cox                         Gerald C. McDonough                  
                                                                          
 
/s/Phyllis Burke Davis_____________   /s/Marvin L. Mann________________    
 
Phyllis Burke Davis                   Marvin L. Mann                       
                                                                           
 
/s/E. Bradley Jones________________   /s/Thomas R. Williams ____________   
 
E. Bradley Jones                      Thomas R. Williams                   
                                                                           
 
/s/Donald J. Kirk __________________          
 
Donald J. Kirk                                
                                              
 
 
POWER OF ATTORNEY
 I, the undersigned Secretary of the investment companies for which
Fidelity Management & Research Company or an affiliate acts as investment
adviser (collectively, the "Funds"), hereby severally constitute and
appoint Arthur J. Brown, Arthur C. Delibert, Stephanie A. Djinis, Robert C.
Hacker, Thomas M. Leahey, Richard M. Phillips, and Dana L. Platt, each of
them singly, my true and lawful attorneys-in-fact, with full power of
substitution, and with full power to each of them, to sign for me and in my
name in the appropriate capacity, any and all representations with respect
to the consistency of foreign language translation prospectuses with the
original prospectuses filed in connection with the Post-Effective
Amendments for the Funds as said attorneys-in-fact deem necessary or
appropriate to comply with the provisions of the Securities Act of 1933 and
the Investment Company Act of 1940, and all related requirements of the
Securities and Exchange Commission.  I hereby ratify and confirm all that
said attorneys-in-fact, or their substitutes may do or cause to be done by
virtue hereof.  This power of attorney is effective for all documents filed
on or after January 1, 1997.
WITNESS my hand on this nineteenth day of December, 1996.
 
 
 
/s/Arthur S. Loring                    
Arthur S. Loring

 
 
 
Exhibit 11(a)
 
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference, into the Prospectus
and Statement of Additional Information constituting part of Post-Effective
Amendment No. 41 to the Registration Statement on Form N-1A of Fidelity
Phillips Street Trust: Fidelity Cash Reserves, of our report dated December
23, 1996 on the financial statements and financial highlights included in
the November 30, 1996 Annual Report to Shareholders of Fidelity Cash
Reserves.
We further consent to the references to our Firm under the headings
"Financial Highlights" in the Prospectus and "Fidelity Cash Reserves'
Auditor" in the Statement of Additional Information.  
/s/COOPERS & LYBRAND L.L.P.
COOPERS & LYBRAND L.L.P.
Dallas, Texas
January 13, 1997
 

 
 
 
Exhibit 11(b)
 
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference, into the Prospectus
and Statement of Additional Information constituting part of Post-Effective
Amendment No. 41 to the Registration Statement on Form N-1A of Fidelity
Phillips Street Trust: Fidelity U.S. Government Reserves, of our report
dated December 30, 1996 on the financial statements and financial
highlights included in the November 30, 1996 Annual Report to Shareholders
of Fidelity U.S. Government Reserves.
We further consent to the references to our Firm under the headings
"Financial Highlights" in the Prospectus and "Fidelity U.S. Government
Reserves' Auditor" in the Statement of Additional Information.  
/s/PRICE WATERHOUSE LLP
    PRICE WATERHOUSE LLP
Dallas, Texas
January 13, 1997
 


<TABLE> <S> <C>
 
 
<ARTICLE> 6 
<CIK> 0000278001
<NAME> Fidelity Phillips Street Trust
<SERIES>
 <NUMBER> 11
 <NAME> Fidelity Cash Reserves
<MULTIPLIER> 1,000
       
<S>
<C>
<PERIOD-TYPE>                 year          
 
<FISCAL-YEAR-END>             Nov-30-1996   
 
<PERIOD-END>                  Nov-30-1996   
 
<INVESTMENTS-AT-COST>         21,475,256    
 
<INVESTMENTS-AT-VALUE>        21,475,256    
 
<RECEIVABLES>                 119,054       
 
<ASSETS-OTHER>                0             
 
<OTHER-ITEMS-ASSETS>          0             
 
<TOTAL-ASSETS>                21,594,310    
 
<PAYABLE-FOR-SECURITIES>      330,927       
 
<SENIOR-LONG-TERM-DEBT>       0             
 
<OTHER-ITEMS-LIABILITIES>     22,785        
 
<TOTAL-LIABILITIES>           353,712       
 
<SENIOR-EQUITY>               0             
 
<PAID-IN-CAPITAL-COMMON>      21,241,673    
 
<SHARES-COMMON-STOCK>         21,241,673    
 
<SHARES-COMMON-PRIOR>         18,432,698    
 
<ACCUMULATED-NII-CURRENT>     0             
 
<OVERDISTRIBUTION-NII>        0             
 
<ACCUMULATED-NET-GAINS>       (1,075)       
 
<OVERDISTRIBUTION-GAINS>      0             
 
<ACCUM-APPREC-OR-DEPREC>      0             
 
<NET-ASSETS>                  21,240,598    
 
<DIVIDEND-INCOME>             0             
 
<INTEREST-INCOME>             1,073,243     
 
<OTHER-INCOME>                0             
 
<EXPENSES-NET>                97,706        
 
<NET-INVESTMENT-INCOME>       975,537       
 
<REALIZED-GAINS-CURRENT>      (160)         
 
<APPREC-INCREASE-CURRENT>     0             
 
<NET-CHANGE-FROM-OPS>         975,377       
 
<EQUALIZATION>                0             
 
<DISTRIBUTIONS-OF-INCOME>     975,537       
 
<DISTRIBUTIONS-OF-GAINS>      0             
 
<DISTRIBUTIONS-OTHER>         0             
 
<NUMBER-OF-SHARES-SOLD>       36,638,550    
 
<NUMBER-OF-SHARES-REDEEMED>   34,777,730    
 
<SHARES-REINVESTED>           948,155       
 
<NET-CHANGE-IN-ASSETS>        2,808,815     
 
<ACCUMULATED-NII-PRIOR>       0             
 
<ACCUMULATED-GAINS-PRIOR>     (915)         
 
<OVERDISTRIB-NII-PRIOR>       0             
 
<OVERDIST-NET-GAINS-PRIOR>    0             
 
<GROSS-ADVISORY-FEES>         40,411        
 
<INTEREST-EXPENSE>            0             
 
<GROSS-EXPENSE>               98,060        
 
<AVERAGE-NET-ASSETS>          19,276,017    
 
<PER-SHARE-NAV-BEGIN>         1.000         
 
<PER-SHARE-NII>               .051          
 
<PER-SHARE-GAIN-APPREC>       0             
 
<PER-SHARE-DIVIDEND>          .051          
 
<PER-SHARE-DISTRIBUTIONS>     0             
 
<RETURNS-OF-CAPITAL>          0             
 
<PER-SHARE-NAV-END>           1.000         
 
<EXPENSE-RATIO>               51            
 
<AVG-DEBT-OUTSTANDING>        0             
 
<AVG-DEBT-PER-SHARE>          0             
 
        


<TABLE> <S> <C>
 
 
<ARTICLE> 6 
<CIK> 0000278001
<NAME> Fidelity Phillips Street Trust
<SERIES>
 <NUMBER> 21
 <NAME> Fidelity U.S. Government Reserves
<MULTIPLIER> 1,000
       
<S>
<C>
<PERIOD-TYPE>                 year          
 
<FISCAL-YEAR-END>             Nov-30-1996   
 
<PERIOD-END>                  Nov-30-1996   
 
<INVESTMENTS-AT-COST>         1,241,025     
 
<INVESTMENTS-AT-VALUE>        1,241,025     
 
<RECEIVABLES>                 4,152         
 
<ASSETS-OTHER>                0             
 
<OTHER-ITEMS-ASSETS>          0             
 
<TOTAL-ASSETS>                1,245,177     
 
<PAYABLE-FOR-SECURITIES>      0             
 
<SENIOR-LONG-TERM-DEBT>       0             
 
<OTHER-ITEMS-LIABILITIES>     2,470         
 
<TOTAL-LIABILITIES>           2,470         
 
<SENIOR-EQUITY>               0             
 
<PAID-IN-CAPITAL-COMMON>      1,242,732     
 
<SHARES-COMMON-STOCK>         1,243,168     
 
<SHARES-COMMON-PRIOR>         1,188,466     
 
<ACCUMULATED-NII-CURRENT>     0             
 
<OVERDISTRIBUTION-NII>        0             
 
<ACCUMULATED-NET-GAINS>       (25)          
 
<OVERDISTRIBUTION-GAINS>      0             
 
<ACCUM-APPREC-OR-DEPREC>      0             
 
<NET-ASSETS>                  1,242,707     
 
<DIVIDEND-INCOME>             0             
 
<INTEREST-INCOME>             65,705        
 
<OTHER-INCOME>                0             
 
<EXPENSES-NET>                5,983         
 
<NET-INVESTMENT-INCOME>       59,722        
 
<REALIZED-GAINS-CURRENT>      12            
 
<APPREC-INCREASE-CURRENT>     0             
 
<NET-CHANGE-FROM-OPS>         59,734        
 
<EQUALIZATION>                0             
 
<DISTRIBUTIONS-OF-INCOME>     59,722        
 
<DISTRIBUTIONS-OF-GAINS>      0             
 
<DISTRIBUTIONS-OTHER>         0             
 
<NUMBER-OF-SHARES-SOLD>       1,718,909     
 
<NUMBER-OF-SHARES-REDEEMED>   1,720,835     
 
<SHARES-REINVESTED>           56,628        
 
<NET-CHANGE-IN-ASSETS>        54,714        
 
<ACCUMULATED-NII-PRIOR>       0             
 
<ACCUMULATED-GAINS-PRIOR>     (37)          
 
<OVERDISTRIB-NII-PRIOR>       0             
 
<OVERDIST-NET-GAINS-PRIOR>    0             
 
<GROSS-ADVISORY-FEES>         2,461         
 
<INTEREST-EXPENSE>            0             
 
<GROSS-EXPENSE>               6,065         
 
<AVERAGE-NET-ASSETS>          1,189,689     
 
<PER-SHARE-NAV-BEGIN>         1.000         
 
<PER-SHARE-NII>               .050          
 
<PER-SHARE-GAIN-APPREC>       0             
 
<PER-SHARE-DIVIDEND>          .050          
 
<PER-SHARE-DISTRIBUTIONS>     0             
 
<RETURNS-OF-CAPITAL>          0             
 
<PER-SHARE-NAV-END>           1.000         
 
<EXPENSE-RATIO>               50            
 
<AVG-DEBT-OUTSTANDING>        0             
 
<AVG-DEBT-PER-SHARE>          0             
 
        



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