PRUDENTIAL GOVERNMENT SECURITIES TRUST, 485BPOS, 1997-02-04

PRUDENTIAL GOVERNMENT SECURITIES TRUST
485BPOS, 1997-02-04

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As filed with the Securities and Exchange Commission

on February 4, 1997
Securities Act Registration No. 2-74139
Investment Company Act Registration No. 811-3264
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [ ]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 26 [X]
and/or
REGISTRATION STATEMENT UNDER THE
INVESTMENT COMPANY ACT OF 1940 [ ]
Amendment No. 27 [X]
------------------
(Check appropriate box or boxes)
PRUDENTIAL GOVERNMENT SECURITIES TRUST
(Exact name of registrant as specified in charter)

(Formerly Prudential-Bache Government Securities Trust)

GATEWAY CENTER THREE
NEWARK, NEW JERSEY 07102-4077
(Address of Principal Executive Offices) (Zip Code)

Registrant's Telephone Number, including Area Code: (201) 367-7530

S. Jane Rose, Esq.
Gateway Center Three
Newark, New Jersey 07102-4077
(Name and Address of Agent for Service)
Approximate date of proposed public offering:
As soon as practicable after the effective
date of the Registration Statement.

It is proposed that this filing will become effective
(check appropriate box):
[X] immediately upon filing pursuant to paragraph (b)
[ ] on (date) pursuant to paragraph (b)
[ ] 60 days after filing pursuant to paragraph (a)(1)
[ ] on (date) pursuant to paragraph (a)(1)
[ ] 75 days after filing pursuant to paragraph (a)(2)
[ ] on (date) 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.

CALCULATION OF REGISTRATION FEE
<TABLE>

<CAPTION>
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Proposed Maximum Proposed Maximum
Title of Securities Amount Being Offering Price Aggregate Amount of
Being Registered Registered Per Share Offering Price* Registration Fee
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<S> <C> <C> <C> <C>
Shares of beneficial interest
par value $.01 per share 74,703,407 $3.30 $290,000 N/A
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<FN>
*The calculation of the maximum aggregate offering price was made pursuant to Rule 24e-2 and was based
upon an offering price of $3.30 per share, calculated in accordance with Rule 457(d) by taking the
weighted average of the offering prices of each series having net redemptions, which offering prices
on the close of business on January 17, 1997 were $9.60 (Short-Intermediate Term Series) and $1 (Money
Market Series). The total number of shares redeemed during the fiscal year ended November 30, 1996
amounted to 5,620,564,924 shares. Of this number, no shares have been used for reduction pursuant to
paragraph (a) of Rule 24e-2 in all previous filings of post-effective amendments during the current
year, and 5,518,589,634 shares have been used for reduction pursuant to paragraph (c) of Rule 24f-2 in
all previous filings during the current year. 74,615,528 ($98,133,545) of the redeemed shares for the
fiscal year ended November 30, 1996 are being used for the reductions in the post-effective amendment
being filed herein.

Pursuant to Rule 24f-2 under the Investment Company Act of 1940, Registrant has previously registered
an indefinite number of shares of beneficial interest, par value $.01 per share. The Registrant filed
a notice under such Rule for its fiscal year ended November 30, 1996 on January 29, 1997.
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</FN>
</TABLE>

<PAGE>

CROSS REFERENCE SHEET
(as required by Rule 495)
<TABLE>
<CAPTION>
N-1A Item No. Location
- ------------- --------
<S> <C>
Part A

Item 1. Cover Page Cover Page

Item 2. Synopsis Trust Expenses; Trust Highlights

Item 3. Condensed Financial Information Trust Expenses; Financial Highlights;
Calculation of Yield; How the Trust
Calculates Performance (Short-Intermediate
Series)

Item 4. General Description of Registrant Cover Page; Trust Highlights; How the
Trust Invests; General Information

Item 5. Management of Fund Financial Highlights; How the Trust is
Managed

Item 5A. Management's Discussion of Fund Performance Not Applicable

Item 6. Capital Stock and Other Securities Taxes, Dividends and Distributions;
General Information; Shareholder Guide

Item 7. Purchase of Securities Being Offered Shareholder Guide; How the Trust Values
Its Shares; How the Trust is Managed

Item 8. Redemption or Repurchase Shareholder Guide; How the Trust Values
Its Shares

Item 9. Pending Legal Proceedings Not Applicable

Part B

Item 10. Cover Page Cover Page

Item 11. Table of Contents Table of Contents

Item 12. General Information and History General Information

Item 13. Investment Objectives and Policies Investment Objective(s) and Policies;
Investment Restrictions

Item 14. Management of the Fund Trustees and Officers; Manager;
Distributor

Item 15. Control Persons and Principal Holders of Securities Not Applicable

Item 16. Investment Advisory and Other Services Manager; Distributor; Custodian and
Transfer and Dividend Disbursing Agent
and Independent Accountants

Item 17. Brokerage Allocation and Other Practices Portfolio Transactions and Brokerage

Item 18. Capital Stock and Other Securities Not Applicable

Item 19. Purchase, Redemption and Pricing of Securities Being Offered Shareholder Investment Account; Net Asset Value

Item 20. Tax Status Taxes

Item 21. Underwriters Distributor

Item 22. Calculation of Performance Data Performance Information

Item 23. Financial Statements Financial Statements

<FN>
Part C
Information required to be included in Part C is set forth under the appropriate Item, so numbered, in Part C to this
Post-Effective Amendment to the Registration Statement.
</FN>
</TABLE>

<PAGE>

Prudential Government Securities Trust
(Money Market Series)

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Prospectus dated February 3, 1997
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Prudential Government Securities Trust (the Trust) is a diversified,
open-end management investment company whose shares of beneficial interest are
offered in three series. Each series operates as a separate fund with its own
investment objectives and policies designed to meet its specific investment
goals. The investment objectives of the Money Market Series (the Series) are to
obtain high current income, preservation of capital and maintenance of liquidity
by investing principally in a diversified portfolio of short-term money-market
instruments issued or guaranteed by the United States Government or its agencies
or instrumentalities. There can be no assurance that the Series' investment
objective will be achieved. See "How the Trust Invests-Investment Objectives and
Policies."

An investment in the Series is neither insured nor guaranteed by the U.S.
Government and there can be no assurance that the Series will be able to
maintain a stable net asset value of $1.00 per share. See "How the Trust Values
its Shares."

The Trust's address is Gateway Center Three, Newark, New Jersey 07102-4077, and
its telephone number is (800) 225-1852.

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This Prospectus sets forth concisely the information about the Trust and the
Series that a prospective investor should know before investing. Additional
information about the Trust has been filed with the Securities and Exchange
Commission in a Statement of Additional Information, dated February 3, 1997,
which information is incorporated herein by reference (is legally considered a
part of this Prospectus) and is available without charge upon request to the
Trust at the address or telephone number noted above.

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Investors are advised to read this Prospectus and retain it for future
reference.

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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.

<PAGE>
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TRUST HIGHLIGHTS
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The following summary is intended to highlight certain information contained
in this prospectus and is qualified in its entirety by the more detailed
information appearing elsewhere herein.

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What is Prudential Government Securities Trust?

Prudential Government Securities Trust is a mutual fund whose shares are
offered in three series, each of which operates as a separate fund. A mutual
fund pools the resources of investors by selling its shares to the public and
investing the proceeds of such sale in a portfolio of securities designed to
achieve its investment objective. Technically, the Trust is an open-end,
diversified management investment company. Only the Money Market Series is
offered through this Prospectus.

What are the Series' Investment Objectives?

The Series' investment objectives are to obtain high current income,
preservation of capital and maintenance of liquidity by investing principally in
a diversified portfolio of short-term money-market instruments issued or
guaranteed by the United States Government or its agencies or instrumentalities.
There can be no assurance that the Series' investment objectives will be
achieved. See "How the Trust Invests-Investment Objectives and Policies" at page
7.

What are the Series' Risk Factors and Special Characteristics?

It is anticipated that the net asset value of the Series will remain
constant at $1.00 per share, although this cannot be assured. In order to
maintain such constant net asset value, the Series will value its portfolio
securities at amortized cost. While this method provides certainty in valuation,
it may result in periods during which the value of a security in its portfolio,
as determined by amortized cost, is higher or lower than the price the Series
would receive if it sold such security. See "How the Trust Values its Shares" at
page 11.

Who Manages the Trust?

Prudential Mutual Fund Management LLC (PMF or the Manager) is the Manager of
the Trust and is compensated for its services at an annual rate of .40 of 1% of
the Series' average daily net assets up to $1 billion, .375 of 1% of the Series'
average daily net assets between $1 billion and $1.5 billion and .35 of 1% in
excess of $1.5 billion. As of December 31, 1996, PMF served as manager or
administrator to 62 investment companies, including 40 mutual funds, with
aggregate assets of approximately $55.2 billion. The Prudential Investment
Corporation (PIC, the Subadviser or the investment adviser) furnishes investment
advisory services in connection with the management of the Trust under a
Subadvisory Agreement with PMF. See "How the Trust is Managed-Manager" at page
9.

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2
<PAGE>

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Who Distributes the Series' Shares?

Prudential Securities Incorporated (Prudential Securities or PSI), a major
securities underwriter and securities and commodities broker, acts as the
Distributor of the Series' Class A shares and is paid an annual service fee at
the rate of .125 of 1% of the average daily net assets of the Series' Class A
shares. Prudential Securities incurs the expense of distributing the Series'
Class Z shares under a Distribution Agreement with the Trust, none of which is
reimbursed or paid for by the Trust. Prior to January 2, 1996, Prudential Mutual
Fund Distributors, Inc. (PMFD) acted as the Distributor of the Series' shares.
See "How the Trust is Managed-Distributor" at page 10.

What is the Minimum Investment?

The minimum initial investment for Class A shares is $1,000. The subsequent
minimum investment for Class A shares is $100. There is no minimum initial or
subsequent investment requirement for investors who qualify to purchase Class Z
shares. There is no minimum investment requirement for certain retirement and
employee savings plans or custodial accounts for the benefit of minors. For
purchases made through the Automatic Savings Accumulation Plan, the minimum
initial and subsequent investment is $50. See "Shareholder Guide-How to Buy
Shares of the Trust" at page 14 and "Shareholder Guide-Shareholder Services" at
page 21.

How Do I Purchase Shares?

You may purchase shares of the Series through Prudential Securities, Pruco
Securities Corporation (Prusec) or directly from the Trust, through its transfer
agent, Prudential Mutual Fund Services LLC (PMFS or the Transfer Agent) at the
net asset value per share (NAV) next determined after receipt of your purchase
order by the Transfer Agent or Prudential Securities. Class Z shares are offered
to a limited group of investors at net asset value without any sales charge. See
"How the Trust Values its Shares" at page 11 and "Shareholder Guide-How to Buy
Shares of the Trust" at page 14.

How Do I Sell My Shares?

You may redeem your shares of the Series at any time at the NAV next
determined after Prudential Securities or the Transfer Agent receives your sell
order. See "Shareholder Guide-How to Sell Your Shares" at page 17.

How Are Dividends and Distributions Paid?

The Series expects to declare daily and pay monthly dividends of net
investment income and short-term capital gains, if any. Dividends and
distributions will be automatically reinvested in additional shares of the
Series at NAV unless you request that they be paid to you in cash. See "Taxes,
Dividends and Distributions" at page 12.

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<PAGE>
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TRUST EXPENSES-MONEY MARKET SERIES

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<TABLE>
<CAPTION>
Shareholder Transaction Expenses Class A Shares Class Z Shares
-------------- --------------
<S> <C> <C>

Maximum Sales Load Imposed on Purchases .............. None None

Maximum Sales Load Imposed on Reinvested Dividends ... None None

Maximum Deferred Sales Load .......................... None None

Redemption Fees ...................................... None None

Exchange Fees ........................................ None None

Annual Series Operating Expenses*
(as a percentage of average net assets)

Management Fees ...................................... 0.400% 0.400%

12b-1 Fees ........................................... 0.125% None

Other Expenses ....................................... 0.335% 0.335%
----- -----

Total Series Operating Expenses ...................... 0.860% 0.735%
===== =====
</TABLE>

<TABLE>
<CAPTION>
Example 1 Year 3 Years 5 Years 10 Years
------- ------ ------- ------- --------
<S> <C> <C> <C> <C>
You would pay the following expenses on a $1,000
investment, assuming (1) 5% annual return, and (2)
redemption at the end of each time period:

Class A ...................................... $9 $27 $48 $106
Class Z* ..................................... $7 $23 $41 $ 91

The above example is based on data for the Series' fiscal year ended
November 30, 1996. The example should not be considered a representation of past
or future expenses. Actual expenses may be greater or less than those shown.

The purpose of this table is to assist an investor in understanding the
various costs and expenses that an investor in the Series will bear, whether
directly or indirectly. For more complete descriptions of the various costs and
expenses, see "How the Trust is Managed." "Other Expenses" include operating
expenses of the Series, such as Trustees' and professional fees, registration
fees, reports to shareholders and transfer agent and custodian fees.

<FN>
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*stimated based on expenses expected to have been incurred if Class Z shares
had been in existence during the entire fiscal year ended November 30, 1996.
</FN>
</TABLE>
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4
<PAGE>

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FINANCIAL HIGHLIGHTS
(for a share of beneficial interest outstanding throughout
each of the periods indicated) (Class A Shares)
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The following financial highlights, with respect to the five-year period
ended November 30, 1996, for the Series' Class A shares have been audited by
Price Waterhouse LLP, independent auditors, whose report thereon was
unqualified. This information should be read in conjunction with the financial
statements and notes thereto, which appear in the Statement of Additional
Information. The following financial highlights contain selected data for a
Class A share of beneficial interest outstanding, total return, ratios to
average net assets and other supplemental data for each of the periods
indicated. The information is based on data contained in the financial
statements. Further performance information is contained in the annual report,
which may be obtained without charge. See "Shareholder Guide-Shareholder
Services-Reports to Shareholders."
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<TABLE>
<CAPTION>
Money Market Series-Class A Shares
------------------------------------------------------------------------------------------------------
Year Ended November 30,
------------------------------------------------------------------------------------------------------
1996(a) 1995 1994 1993 1992 1991 1990 1989 1988(a) 1987
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>

PER SHARE OPERATING
PERFORMANCE:
Net asset value, beginning
of period ............... $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Net investment income ..... .046 .052 .033 .026 .035 .058 .076 .084 .067 .058
Dividends from net
investment income ....... (.046) (.052) (.033) (.026) (.035) (.058) (.076) (.084) (.067) (.058)
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Net asset value, end of
period .................. $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
TOTAL RETURN(b) ........... 4.74% 5.20% 3.29% 2.62% 3.57% 5.96% 7.83% 8.77% 6.99% 6.01%
RATIOS/SUPPLEMENTAL DATA:

Net assets, end of period
(000) ................... $552,123 $598,194 $637,343 $919,503 $1,026,187 $1,212,836 $1,355,058 $667,571 $470,727 $445,761
Average net assets (000) .. $589,147 $597,599 $732,867 $950,988 $1,113,759 $1,255,014 $ 857,385 $528,820 $480,598 $368,100
Ratio to average net assets:
Expenses, including
distribution fees ..... .86% .78% .77% .72% .72% .65% .66% .68% .65% .68%
Expenses, excluding
distribution fees ..... .73% .65% .64% .59% .60% .53% .53% .56% .52% .55%
Net investment income ... 4.63% 5.15% 3.19% 2.56% 3.42% 5.78% 7.52% 8.30% 6.69% 5.78%
<FN>
- -----------------
(a) On August 9, 1988, Prudential Mutual Fund Management, Inc. succeeded The Prudential Insurance Company of America as investment
adviser and since then has acted as manager of the Trust. In September 1996, Prudential Mutual Fund Management LLC (PMF)
succeeded Prudential Mutual Fund Management, Inc., which transferred its assets to PMF. See "Manager" in the Statement of
Additional Information.

(b) Total return is calculated assuming a purchase of shares on the first day and a sale on the last day of each year reported and
includes reinvestment of dividends and distributions.
</FN>
</TABLE>
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<PAGE>

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FINANCIAL HIGHLIGHTS
(for a share of beneficial interest outstanding throughout the indicated period)
(Class Z Shares)
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The following financial highlights have been audited by Price Waterhouse
LLP, independent auditors, whose report thereon was unqualified. This
information should be read in conjunction with the financial statements and
notes thereto, which appear in the Statement of Additional Information. The
following financial highlights contain selected data for a Class Z share of
beneficial interest outstanding, total return, ratios to average net assets and
other supplemental data for the period indicated. The information is based on
data contained in the financial statements. Further performance information is
contained in the annual report, which may be obtained without charge. See
"Shareholder Guide-Shareholder Services-Reports to Shareholders."

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Money Market Series-Class Z Shares
Class Z
March 1,
1996(a)
through
November 30,
1996
------------

PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period .............................. $1,000
------
Net investment income ............................................. .038
Dividends from net investment income .............................. (.038)
------
Net asset value, end of period .................................... $ 1.00
======
TOTAL RETURN (c): ................................................. 3.87%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000) ................................... $ 204(d)
Average net assets (000) .......................................... $1,962
Ratio of average net assets:
Expenses ........................................................ .68%(b)
Net investment income ........................................... 4.68%(b)

(a) Commencement of offering of Class Z shares. In September 1996, PMF succeeded
Prudential Mutual Fund Management, Inc., which transferred its assets to
PMF. See "Manager" in the Statement of Additional Information.
(b) Annualized.
(c) Total return is calculated assuming a purchase of shares on the first day
and a sale on the last day of the period reported and includes reinvestment
of dividends and distributions. Total returns for periods of less than a
full year are not annualized.
(d) Figure is actual and not rounded to nearest thousand.
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6
<PAGE>

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CALCULATION OF YIELD
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The Series calculates its "current yield" based on the net change, exclusive
of realized and unrealized gains or losses, in the value of a hypothetical
account over a seven calendar day base period. The Series also calculates its
"effective annual yield" assuming weekly compounding. The following are examples
of the yield calculations as of November 30, 1996 for Class A and Class Z shares
of the Series:

Class A shares
Value of hypothetical account at end of period ............. $1.000886180
Value of hypothetical account at beginning of period ....... 1.000000000
------------
Base period return ......................................... $0.000886180
============
Current yield (.000886180 x (365/7)) ....................... 4.62%
Effective annual yield, assuming weekly compounding ........ 4.73%

Class Z shares
Value of hypothetical account at end of period ............. $1.000911763
Value of hypothetical account at beginning of period ....... 1.000000000
------------
Base period return ......................................... $0.000911763
============
Current yield (.000911763 x (365/7)) ....................... 4.75%
Effective annual yield, assuming weekly compounding ........ 4.87%

The yield will fluctuate from time to time and is not necessarily
representative of future performance.

The weighted average life to maturity of the portfolio of the Series on
November 30, 1996 was 48 days.

Yield is computed in accordance with a standardized formula described in the
Statement of Additional Information. In addition, comparative performance
information may be used from time to time in advertising or marketing the
Trust's shares, including data from Lipper Analytical Services, Inc.,
Morningstar Publications, Inc., Donoghue's Money Fund Report, The Bank Rate
Monitor, other industry publications, business periodicals, and market indices.

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HOW THE TRUST INVESTS
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INVESTMENT OBJECTIVES AND POLICIES

The investment objectives of the Series are to obtain high current income,
preserve capital and maintain liquidity. There can be no assurance that the
Series' objectives will be achieved.

The Series' investment objectives are fundamental policies, and, therefore,
may not be changed without the approval of the holders of a majority of the
outstanding voting securities of the Money Market Series, as defined in the
Investment Company Act of 1940, as amended (the Investment Company Act).
Policies that are not fundamental may be modified by the Trustees.

The Series will invest at least 80% of its total assets in United States
Government securities. These securities may include securities issued or
guaranteed by the United States Treasury, by various agencies of the United
States Government or by various instrumentalities which have been established or
sponsored by the United States Government including repurchase agreements with
respect to such securities. The Series may also invest in fully insured
certificates of deposit issued by banks or savings and loan associations subject
to certain restrictions and

7
<PAGE>

obligations of the International Bank for Reconstruction and Development (the
World Bank). Obligations of the World Bank are supported by appropriated but
unpaid commitments of its member countries, including the United States, and
there is no assurance these commitments will be undertaken or met in the future.
See "Investment Restrictions" in the Statement of Additional Information.

The Series may also purchase instruments of the types described above
together with the right to resell the instruments at an agreed-upon price or
yield within a specified period prior to the maturity date of the instrument,
commonly known as a "put." The aggregate price that the Series pays for
instruments with a put may be higher than the price that otherwise would be paid
for the instruments. See "Investment Objectives and Policies" in the Statement
of Additional Information.

The Series seeks to maintain a $1.00 share price at all times. To achieve
this, the Series purchases only securities with remaining maturities of thirteen
months or less and limits the dollar-weighted average maturity of its portfolio
to 90 days or less. There is no assurance that the Series will be able to
maintain a stable net asset value. See "How the Trust Values its Shares."

The Series utilizes the amortized cost method of valuation in accordance
with regulations issued by the Securities and Exchange Commission (SEC). See
"How the Trust Values its Shares." Accordingly, the Series will limit its
portfolio investments to those instruments which present minimal credit risks
and which are of "eligible quality" as determined by the Series' investment
adviser under the supervision of the Trustees. "Eligible quality," for this
purpose, means (i) a security rated in one of the two highest rating categories
by at least two major rating agencies assigning a rating to the security or
issuer (or, if only one agency assigned a rating, that agency) or (ii) an
unrated security deemed of comparable quality by the Series' investment adviser
under the supervision of the Trustees. The purchase by the Series of a security
of eligible quality that is rated by only one rating agency or is unrated must
be approved or ratified by the Trustees.

OTHER INVESTMENTS AND POLICIES

Repurchase Agreements

The Series may enter into repurchase agreements, whereby the seller of a
security agrees to repurchase that security from the Series at a mutually
agreed-upon time and price. The period of maturity is usually quite short,
possibly overnight or a few days, although it may extend over a number of
months. The resale price is in excess of the purchase price, reflecting an
agreed-upon rate of return effective for the period of time the Series' money is
invested in the security. The Series' repurchase agreements will at all times be
fully collateralized in an amount at least equal to the resale price. The
instruments held as collateral are valued daily, and if the value of such
instruments declines, the Series will require additional collateral. If the
seller defaults and the value of the collateral securing the repurchase
agreement declines, the Series may incur a loss. The Series participates in a
joint repurchase account with other investment companies managed by Prudential
Mutual Fund Management LLC pursuant to an order of the SEC.

When-Issued and Delayed Delivery Securities

The Series may purchase or sell securities on a when-issued or delayed
delivery basis. When-issued or delayed delivery transactions arise when
securities are purchased or sold by the Series with payment and delivery taking
place as much as a month or more into the future in order to secure what is
considered to be an advantageous price and yield to the Series at the time of
entering into the transaction. The Trust's Custodian will maintain, in a
segregated account of the Series, cash, U.S. Government securities, equity
securities or other liquid, unencumbered assets, marked to market daily, having
a value equal to or greater than the Series' purchase commitments. The
securities so purchased are subject to market fluctuation and no interest
accrues to the purchaser during the period between purchase and settlement. At
the time of delivery of the securities the value may be more or less than the
purchase price and an increase in the percentage of the Series' assets commited
to the purchase of securities on a when-issued or delayed delivery basis may
increase the volatility of the Series' net asset value.

8
<PAGE>

Borrowing

The Series may borrow an amount equal to no more than 20% of the value of
its total assets (calculated when the loan is made) from banks for temporary,
extraordinary or emergency purposes. The Series may pledge up to 20% of its
total assets to secure these borrowings. Borrowing for purposes other than
meeting redemptions may not exceed 5% of the value of the Series' total assets.
Investment securities will not be purchased while borrowings are outstanding.

Illiquid Securities

securities that are not readily marketable. Restricted securities eligible for
resale pursuant to Rule 144A under the Securities Act of 1933, as amended (the
Securities Act), privately placed commercial paper and municipal lease
obligations if in each case such investments have a readily available market are
not considered illiquid for purposes of this limitation. The Series' investment
in Rule 144A securities could have the effect of increasing illiquidity to the
extent that qualified institutional buyers become, for a time, uninterested in
purchasing Rule 144A securities. The investment adviser will monitor the
liquidity of such restricted securities under the supervision of the Trustees.
Repurchase agreements subject to demand are deemed to have a maturity equal to
the applicable notice period.

INVESTMENT RESTRICTIONS

The Series is subject to certain investment restrictions which, like its
investment objective, constitute fundamental policies. Fundamental policies
cannot be changed without the approval of the holders of a majority of the
Series' outstanding securities, as defined in the Investment Company Act. See
"Investment Restrictions" in the Statement of Additional Information.

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HOW THE TRUST IS MANAGED
- --------------------------------------------------------------------------------

The Trust has Trustees who, in addition to overseeing the actions of the
Trust's Manager, Subadviser and Distributor, as set forth below, decide upon
matters of general policy. The Trust's Manager conducts and supervises the daily
business operations of the Trust. The Trust's Subadviser furnishes daily
investment advisory services.

For the fiscal year ended November 30, 1996, total expenses of the Series'
Class A and Class Z shares as a percentage of its average net assets were .86%
and .68%, respectively. See "Financial Highlights."

MANAGER

Prudential Mutual Fund Management LLC (PMF or the Manager), Gateway Center
Three, Newark, New Jersey 07102, is the Manager of the Trust and is compensated
for its services at an annual rate of .40 of 1% of the Series' average daily net
assets up to $1 billion, .375 of 1% of the Series' average daily net assets
between $1 billion and $1.5 billion and .35 of 1% in excess of $1.5 billion. PMF
is organized in New York as a limited liability company. It is the successor to
Prudential Mutual Fund Management, Inc., which transferred its assets to PMF in
September 1996. For the fiscal year ended November 30, 1996, the Trust paid
management fees to PMF of .40% of the average net assets of the Series. See
"Manager" in the Statement of Additional Information.

As of December 31, 1996, PMF served as the manager to 40 open-end investment
companies, constituting all of the Prudential Mutual Funds, and as manager or
administrator to 22 closed-end investment companies with aggregate assets of
approximately $55.2 billion.

Under the Management Agreement with the Trust, PMF manages the investment
operations of the Trust and also administers the Trust's corporate affairs. See
"Manager" in the Statement of Additional Information.

Under a Subadvisory Agreement between PMF and The Prudential Investment
Corporation (PIC, the Subadviser or the investment adviser), PIC furnishes
investment advisory services in connection with the

9
<PAGE>

management of the Trust and is reimbursed by PMF for its reasonable costs and
expenses incurred in providing such services. Under the Management Agreement,
PMF continues to have responsibility for all investment advisory services and
supervises PIC's performance of such services.

PMF and PIC are indirect, wholly-owned subsidiaries of The Prudential
Insurance Company of America (Prudential), a major diversified insurance and
financial services company, and are part of Prudential Investments, a business
group of Prudential.

DISTRIBUTOR

Prudential Securities Incorporated (Prudential Securities or PSI), One
Seaport Plaza, New York, New York 10292, is a corporation organized under the
laws of the State of Delaware and serves as the distributor of the Series'
shares. It is an indirect, wholly-owned subsidiary of Prudential.

Under a Distribution and Service Plan (the Class A Plan) adopted by the
Series under Rule 12b-1 under the Investment Company Act and a distribution and
service agreement (the Distribution Agreement), the Distributor incurs the
expenses of distributing Class A shares of the Series. Prudential Securities
also incurs the expense of distributing the Series' Class Z shares under the
Distribution Agreement with the Trust, none of which is reimbursed by or paid
for by the Trust. These expenses include account servicing fees paid to, or on
account of, financial advisers of Prudential Securities and representatives of
Pruco Securities Corporation (Prusec), an affiliated broker-dealer, account
servicing fees paid to, or on account of, other broker-dealers or financial
institutions (other than national banks) which have entered into agreements with
the Distributor, advertising expenses, the cost of printing and mailing
prospectuses to potential investors and indirect and overhead costs of
Prudential Securities and Prusec associated with the sale of the Series' Class A
shares, including lease, utility, communications and sales promotion expenses.
The State of Texas requires that shares of the Trust may be sold in that state
only by dealers or other financial institutions which are registered there as
broker-dealers.

Under the Class A Plan, the Trust is obligated to pay a service fee to the
Distributor as compensation for its distribution and service activities on
behalf of the Class A shares of the Series, not as reimbursement for specific
expenses incurred. If the Distributor's expenses exceed its distribution and
service fees, the Trust will not be obligated to pay any additional expenses. If
the Distributor's expenses are less than such distribution and service fees, it
will retain its full fees and realize a profit.

Under the Class A Plan, the Trust pays Prudential Securities for its
distribution-related activities with respect to Class A shares of the Series at
an annual rate of up to .125 of 1% of the average daily net assets of the
Series' Class A shares. Account servicing fees are paid based on the average
balance of the Series. Class A shares held in accounts of customers of financial
advisers. The entire distribution fee may be used to pay account servicing fees.

For the fiscal year ended November 30, 1996, the Series paid distribution
expenses of .125 of 1% of the average daily net assets of its Class A shares.
The Trust records all payments made under the Class A Plan as expenses in the
calculation of its net investment income.

The Class A Plan provides that it shall continue in effect from year to year
provided that each such continuance is approved annually by a majority vote of
the Trustees, including a majority of the Trustees who are not interested
persons of the Trust and who have no direct or indirect financial interest in
the operation of the Class A Plan or any agreements related to the Class A Plan
(Rule 12b-1 Trustees). The Trustees are provided with and review quarterly
reports of expenditures under the Plan. The Class A Plan may be terminated at
any time by vote of a majority of the Rule 12b-1 Trustees or of a majority of
the Series' outstanding Class A shares. The Trust will not be obligated to pay
expenses incurred under the Class A Plan if it is terminated or not continued.

In addition to distribution and service fees paid by the Series under the
Class A Plan, the Manager (or one of its affiliates) may make payments out of
its own resources to dealers (including Prudential Securities) and other persons
who distribute shares of the Series (including Class Z shares). Such payments
may be calculated by reference to the net asset value of shares sold by such
persons or otherwise.

10
<PAGE>

On October 21, 1993, PSI entered into an omnibus settlement with the SEC,
state securities regulators (with the exception of the Texas Securities
Commissioner who joined the settlement on January 18, 1994) and the National
Association of Securities Dealers, Inc. (NASD) to resolve allegations that from
1980 through 1990 PSI sold certain limited partnership interests in violation of
securities laws to persons for whom such securities were not suitable and
misrepresented the safety, potential returns and liquidity of these investments.
Without admitting or denying the allegations asserted against it, PSI consented
to the entry of an SEC Administrative Order which stated that PSI's conduct
violated the federal securities laws, directed PSI to cease and desist from
violating the federal securities laws, pay civil penalties, and adopt certain
remedial measures to address the violations.

Pursuant to the terms of the SEC settlement, PSI agreed to the imposition of
a $10,000,000 civil penalty, established a settlement fund in the amount of
$330,000,000 and procedures to resolve legitimate claims for compensatory
damages by purchasers of the partnership interests. PSI has agreed to provide
additional funds, if necessary, for the purpose of the settlement fund. PSI's
settlement with the state securities regulators included an agreement to pay a
penalty of $500,000 per jurisdiction. PSI consented to a censure and to the
payment of a $5,000,000 fine in settling the NASD action.

In October 1994, a criminal complaint was filed with the United States
Magistrate for the Southern District of New York alleging that PSI committed
fraud in connection with the sale of certain limited partnership interests in
violation of federal securities laws. An agreement was simultaneously filed to
defer prosecution of these charges for a period of three years from the signing
of the agreement, provided that PSI complies with the terms of the agreement.
If, upon completion of the three year period, PSI has complied with the terms of
the agreement, no prosecution will be instituted by the United States for the
offenses charged in the complaint. If on the other hand, during the course of
the three year period, PSI violates the terms of the agreement, the U.S.
Attorney can then elect to pursue these charges. Under the terms of the
agreement, PSI agreed, among other things, to pay an additional $330,000,000
into the fund established by the SEC to pay restitution to investors who
purchased certain PSI limited partnership interests.

For more detailed information concerning the foregoing matters, see
"Distributor" in the Statement of Additional Information, a copy of which may be
obtained at no cost by calling 1-800-225-1852.

The Trust is not affected by PSI's financial condition and is an entirely
separate legal entity from PSI, which has no beneficial ownership therein and
the Trust's assets which are held by State Street Bank and Trust Company, an
independent custodian, are separate and distinct from PSI.

PORTFOLIO TRANSACTIONS

Prudential Securities may act as a broker for the Trust, provided that the
commissions, fees or other remuneration it receives are fair and reasonable. See
"Portfolio Transactions and Brokerage" in the Statement of Additional
Information.

CUSTODIAN AND TRANSFER AND DIVIDEND DISBURSING AGENT

State Street Bank and Trust Company, One Heritage Drive, North Quincy,
Massachusetts 02171, serves as Custodian of the Trust's portfolio securities
and, in that capacity, maintains certain financial and accounting books and
records pursuant to an agreement with the Trust. Its mailing address is P.O. Box
1713, Boston, Massachusetts 02105.

Prudential Mutual Fund Services LLC, Raritan Plaza One, Edison, New Jersey
08837, serves as Transfer and Dividend Disbursing Agent and, in those
capacities, maintains certain books and records for the Trust. PMFS is a
wholly-owned subsidiary of PMF. Its mailing address is P.O. Box 15005, New
Brunswick, New Jersey 08906-5005.

- --------------------------------------------------------------------------------
HOW THE TRUST VALUES ITS SHARES
- --------------------------------------------------------------------------------

<PAGE>

The Trustees have fixed the specific time of day for the computation of the
Series' NAV to be as of 4:30 P.M., New York time, immediately after the daily
declaration of dividends.

The Series will compute its NAV once daily on the days that the New York
Stock Exchange is open for trading, except on days on which no orders to
purchase, sell or redeem Series shares have been received or days on which
changes in the value of the Series' portfolio securities do not materially
affect the NAV. The New York Stock Exchange is closed on the following holidays:
New Year's Day, Presidents' Day, Good Friday, Memorial Day, Independence Day,
Labor Day, Thanksgiving Day and Christmas Day.

The Series determines the value of its portfolio securities by the amortized
cost method. This method involves valuing a security at its cost at the time of
purchase and thereafter assuming a constant amortization to maturity of any
discount or premium regardless of the impact of fluctuating interest rates on
the market value of the instrument. While this method provides certainty in
valuation, it may result in periods during which value, as determined by
amortized cost, is higher or lower than the price the Series would receive if it
sold the instrument. During these periods, the yield to a shareholder may differ
somewhat from that which could be obtained from a similar fund which marks its
portfolio securities to the market each day. For example, during periods of
declining interest rates, if the use of the amortized cost method resulted in a
lower value of the Series' portfolio on a given day, a prospective investor in
the Series would be able to obtain a somewhat higher yield and existing
shareholders would receive correspondingly less income. The converse would apply
during periods of rising interest rates. The Trustees have established
procedures designed to stabilize, to the extent reasonably possible, the NAV of
the Series' shares at $1.00 per share. See "Net Asset Value" in the Statement of
Additional Information.

- --------------------------------------------------------------------------------
TAXES, DIVIDENDS AND DISTRIBUTIONS
- --------------------------------------------------------------------------------

Taxation of the Series

Each series of the Trust is treated as a separate entity for federal income
tax purposes and each has elected to qualify and intends to remain qualified as
a regulated investment company under the Internal Revenue Code. Accordingly, the
Series will not be subject to federal income taxes on its net investment income
and capital gain, if any, it distributes to shareholders. To the extent not
distributed by the Series, taxable net investment income and net capital gains
are taxable to the Series. The performance and tax qualification of one series
will have no effect on the federal income tax liability of shareholders of the
other series. See "Taxes" in the Statement of Additional Information.

Taxation of Shareholders

Distributions of net investment income and net short-term capital gains
(i.e., the excess of net short-term capital gains over net long-term capital
losses), if any, will be taxable to shareholders of the Series as ordinary
income, whether or not reinvested. The Series does not expect to realize
long-term capital gains or losses. Because none of the income of the Series will
consist of dividends from domestic corporations, dividends of net investment
income and distributions of net short-term capital gains will not be eligible
for the dividends-received deduction for corporate shareholders. Tax-exempt
shareholders will generally not be required to pay taxes on amounts distributed
to them.

The Trust has obtained an opinion of counsel to the effect that the exchange
of one class of the Series' shares for another class of its shares does not
constitute a taxable event for federal income tax purposes. However, such
opinion is not binding on the Internal Revenue Service.

Shareholders are advised to consult their own tax advisers regarding
specific questions as to federal, state or local taxes.

Withholding Taxes

Under Treasury Regulations, the Trust is required to withhold and remit to
the U.S. Treasury 31% of dividends, capital gain distributions and redemption
proceeds on the accounts of those shareholders who fail to furnish their tax

12
<PAGE>

identification numbers on IRS Form W-9 (or IRS Form W-8 in the case of certain
foreign shareholders). Withholding at this rate is also required from dividends
and capital gains distributions (but not redemption proceeds) payable to
shareholders who are otherwise subject to backup withholding. Dividends from net
investment income and short-term capital gains paid to a foreign shareholder
will generally be subject to U.S. withholding tax at the rate of 30% (or lower
treaty rate).

Dividends and Distributions

The Series expects to declare daily and pay monthly dividends of net
investment income and short-term capital gains, if any. A shareholder generally
begins to earn dividends on the first business day after his or her order is
placed with the Series, as described below, and continues to earn dividends
through the day on which his or her shares are redeemed. In the case of certain
redemptions, however, Prudential Securities clients will not be entitled to
dividends declared on the date of redemption. See "How to Sell Your
Shares-Redemption of Shares Purchased Through Prudential Securities."

Dividends and distributions will be paid in additional shares of the Series
based on the net asset value of each class of the Series' shares on the payment
date, unless the shareholder elects in writing not less than five business days
prior to the payment date to receive such dividends and distributions in cash.
Such election should be submitted to Prudential Mutual Fund Services LLC, Att:
Account Maintenance, P.O. Box 15015, New Brunswick, New Jersey 08906-5015. If
you hold shares through Prudential Securities, you should contact your financial
adviser to elect to receive dividends and distributions in cash. The Trust will
notify each shareholder after the close of the Trust's taxable year of both the
dollar amount and taxable status of that year's dividends and distributions on a
per share basis. Distributions may be subject to state and local taxes. See
"Taxation of Shareholders" above.

- --------------------------------------------------------------------------------
GENERAL INFORMATION
- --------------------------------------------------------------------------------

DESCRIPTION OF SHARES

The Trust, organized in 1981 as an unincorporated business trust under the
laws of Massachusetts, is a trust fund of the type commonly known as a
"Massachusetts business trust." The Trust's activities are supervised by its
Trustees. The Declaration of Trust permits the Trustees to issue an unlimited
number of full and fractional shares in separate series and classes within such
series. The Series is authorized to issue an unlimited number of shares, divided
into two classes, designated Class A and Class Z.

The shareholders of the Money Market Series, the Short-Intermediate Term
Series and the U.S. Treasury Money Market Series are each entitled to a full
vote for each full share of beneficial interest (par value $.01 per share) held
(and fractional votes for fractional shares). Shares of each series are entitled
to vote as a class only to the extent required by the provisions of the
Investment Company Act or as otherwise permitted by the Trustees in their sole
discretion. Under the Investment Company Act, shareholders of each series have
to approve the adoption of any investment advisory agreement relating to such
series and of any changes in the investment policies related thereto.

Shares of the Money Market Series are currently divided into two classes
designated Class A and Class Z shares. Each class represents an interest in the
same assets of the Series and is identical in all respects except that (i) each
class is subject to different expenses which may affect performance, (ii) each
class has exclusive voting rights on any matter submitted to shareholders that
relates solely to its arrangement and has separate voting rights on any matter
submitted to shareholders in which the interests of one class differ from the
interests of the other class, (iii) each class has a different exchange
privilege and (iv) Class Z shares are offered exclusively for sale to a limited
group of investors. Since Class A shares are subject to distribution and/or
service expenses, the liquidation proceeds to shareholders of that class are
likely to be lower than to Class Z shareholders whose shares are not subject to
any distribution and/or service expenses. In accordance with the Trust's
Declaration of Trust, the Trustees may authorize the creation of additional
classes, with such preferences, privileges, limitations and voting and dividend
rights as the Trustees may determine.

13
<PAGE>

It is the intention of the Trust not to hold annual meetings of
shareholders. The Trustees may call special meetings of shareholders for action
by shareholder vote as may be required by the Investment Company Act or the
Declaration of Trust. Shareholders have certain rights, including the right to
call a meeting upon vote of 10% of the Trust's outstanding shares for the
purpose of voting on the removal of one or more Trustees.

ADDITIONAL INFORMATION

This Prospectus, including the Statement of Additional Information which has
been incorporated by reference herein, does not contain all the information set
forth in the Registration Statement filed by the Trust with the SEC under the
Securities Act of 1933. Copies of the Registration Statement may be obtained at
a reasonable charge from the SEC or may be examined, without charge, at the
office of the SEC in Washington, D.C.

- --------------------------------------------------------------------------------
SHAREHOLDER GUIDE
- --------------------------------------------------------------------------------

HOW TO BUY SHARES OF THE TRUST

General Information

Shares of the Trust are available through Prudential Securities Incorporated
(Prudential Securities), Pruco Securities Corporation (Prusec) or directly from
the Trust, through its Transfer Agent, Prudential Mutual Fund Services LLC (PMFS
or the Transfer Agent), Attention: Investment Services, P.O. Box 15020, New
Brunswick, New Jersey 08906-5020. Shareholders of the Trust who are clients of
Prudential Securities are subject to the procedures under "Purchases through
Prudential Securities" below.

The Trust offers two classes of shares: Class A shares and Class Z shares.
Class Z shares are offered to a limited group of investors.

The minimum initial investment for the Class A shares of the Series is
$1,000 and the minimum subsequent investment is $100. There is no minimum
initial or subsequent investment for investors who qualify to purchase Class Z
shares. All minimum investment requirements are waived for certain retirement
and employee savings plans and custodial accounts for the benefit of minors. For
purchases made through the Automatic Savings Accumulation Plan, the minimum
initial and subsequent investment is $50. See "Shareholder Services" below. For
automatic purchases made through Prudential Securities, the minimum initial
investment requirement for Class A shares of the Series is $1,000 and there is
no minimum subsequent investment requirement.

Shares of the Trust are sold through the Transfer Agent, without a sales
charge, at the NAV next determined after receipt and acceptance by the Transfer
Agent of a purchase order and payment in proper form (i.e., a check or Federal
Funds wired to State Street Bank and Trust Company (State Street), the Trust's
custodian). See "How the Trust Values its Shares." When payment is received by
the Transfer Agent prior to 4:30 P.M., New York time, in proper form, a share
purchase order will be entered at the price determined as of 4:30 P.M., on that
day, and the shares will begin to earn dividends on the following business day.
See "Taxes, Dividends and Distributions." If your purchase is made through an
account at Prudential Securities or through Prusec or another dealer, your
dealer will forward a purchase order and payment to the Trust.

Investors who purchase their shares through a dealer other than Prudential
Securities or Prusec, which dealer has a clearing arrangement with respect to
shares of the Trust, may be able to participate in the automatic sweep feature
described below under "Purchases through Prudential Securities-Automatic
Investment (Autosweep)" and "How to Sell Your Shares-Redemptions of Shares
Purchased through Prudential Securities." For further information, contact your
dealer.

14
<PAGE>

Application forms for Prusec and direct accounts with the Transfer Agent
(e.g., non-Prudential Securities accounts) can be obtained from PMFS or Prusec.
If a stock certificate is desired, it must be requested in writing for each
transaction. Certificates are issued only for full shares. Shareholders who hold
their shares through Prudential Securities will not receive stock certificates.
Shareholders cannot utilize Expedited Redemption or Check Redemption or have a
Systematic Withdrawal Plan if they have been issued certificates.

The Trust reserves the right, in its discretion, to reject any purchase
order (including an exchange into the Trust) or to suspend or modify the
continuous offering of its shares. See "How to Sell Your Shares" below.

Transactions in Trust shares may be subject to postage and other charges
imposed by your dealer.

In connection with the sale of shares of the Series, the Manager, the
Distributor or one of their affiliates may pay dealers, financial advisers and
other persons who distribute shares a finders' fee based on a percentage of the
net asset value of shares by such persons. For more information about shares of
the Trust contact your Prudential Securities financial adviser or Prusec
representative or telephone the Trust at (800) 225-1852. Participants in
programs sponsored by Prudential Retirement Services should contact their client
representative for more information about Class Z shares.

Class Z Shares

Class Z shares of the Series are available for purchase by the following
categories of investors:

(i) pension, profit-sharing or other employee benefit plans qualified under
Section 401 of the Internal Revenue Code, deferred compensation and annuity
plans under Sections 457 and 403(b)(7) of the Internal Revenue Code, and
non-qualified plans for which the Series is an available option (collectively,
Benefit Plans), provided such Benefit Plans (in combination with other plans
sponsored by the same employer or group of related employers) have at least $50
million in defined contribution assets; (ii) participants in any fee-based
program sponsored by Prudential Securities or its affiliates which includes
mutual funds as investment options and for which the Series is an available
option; and (iii) investors who were, or had executed a letter of intent to
become, shareholders of any series of Prudential Dryden Fund (Dryden Fund) on or
before one or more series of Dryden Fund reorganized or who on that date had
investments in certain products for which Dryden Fund provided exchangeability.
After a Benefit Plan qualifies to purchase Class Z shares, all subsequent
purchases will be for Class Z shares.

Purchases through Prudential Securities

Automatic Investment (Autosweep) (for Non-Command Accounts)

Prudential Securities has advised the Trust that it has automatic investment
procedures (Autosweep) pursuant to which it will make automatic investments of
free credit cash balances (Eligible Credit Balances) held in a client's
brokerage account in shares of the Series, if the Series is your Primary Money
Sweep Fund. You may designate the Series (or certain other Prudential money
market funds) as your Primary Money Sweep Fund. If the Series is your Primary
Money Sweep Fund you can purchase shares of the Series only through the
automatic investment procedures described below; no manual purchase orders will
be accepted. You may change your Primary Money Sweep Fund at any time by
notifying your Prudential Securities financial adviser. Under certain
circumstances, you may elect not to have a money market sweep feature for your
account when you open your account.

15
<PAGE>

monthly on the last business day of the month. For IRAs and Benefit Plans,
having Eligible Credit Balances of $1.00 or more, orders to purchase shares of
the Series will be placed by Prudential Securities (i) on the settlement date of
the securities sale, in the case of Eligible Credit Balances resulting from the
proceeds of a securities sale, and (ii) on the business day after receipt by
Prudential Securities of the non-trade related credit (including the maturity of
a bond or a call), in the case of Eligible Credit Balances resulting from a
non-trade related credit. Each time an order resulting from the settlement of a
securities sale is placed, any non-trade related credit in the client's account
will also be invested.

The following chart shows the frequency and amount of the sweep for accounts
other than IRAs and Benefit Plans.

- -------------------------------------------------------------------------------------------------------------
Daily Monthly
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Eligible Credit Balances resulting from the proceeds of a
securities sale, maturity of a bond or call $1,000 or more
- -------------------------------------------------------------------------------------------------------------
Eligible Credit Balances resulting from a non-trade related credit $10,000 or more
- -------------------------------------------------------------------------------------------------------------
Remaining Eligible Credit Balances $1.00 or more
- -------------------------------------------------------------------------------------------------------------
</TABLE>

All shares purchased pursuant to these automatic investment procedures will
be issued at the NAV computed on the business day the order is entered and will
begin earning dividends on the following business day. Purchases through
Autosweep are subject to the Series' minimum initial investment requirement of
$1,000 for Class A shares, which is waived for certain retirement and employee
savings plans and custodial accounts for the benefit of minors. There is no
minimum initial or subsequent investment requirement for investors who qualify
to purchase Class Z shares. Prudential Securities will have the use of, and will
retain the benefits of, Eligible Credit Balances in a client's brokerage account
until monies are delivered to the Trust. (Prudential Securities delivers federal
funds on the business day after settlement). Eligible Credit Balances for
purposes of Autosweep are measured as of the close of business on the previous
business day.

For the purposes of Autosweep, "Benefit Plans" include (i) employee benefit
plans as defined in Section 3(3) of the Employee Retirement Income Security Act
of 1974 (ERISA) other than governmental plans as defined in Section 3(32) of
ERISA and church plans as defined in Section 3(33) of ERISA, (ii) pension,
profit-sharing or other employee benefit plans qualified under Section 401 of
the Internal Revenue Code and (iii) deferred compensation and annuity plans
under Section 457 or 403(b)(7) of the Internal Revenue Code. "IRAs" are
Individual Retirement Accounts as defined in Section 408(a) of the Internal
Revenue Code.

Manual Investment

Prudential Securities will accept manual purchase orders for shares of the
Series only for those clients (i) who are purchasing shares of a Prudential
money market fund which is not their Primary Money Sweep Fund or (ii) who do not
have a money market sweep feature in their account, as described above under
"Automatic Investment."

Prudential Securities clients eligible to make manual purchases, as
described above, are subject to the minimum initial investment of $1,000 for
Class A shares of the Series and the minimum subsequent investment of $100,
except that all minimum investment requirements are waived for certain
retirement and employee savings plans and custodial accounts for the benefit of
minors. There is no minimum initial or subsequent investment requirement for
investors who qualify to purchase Class Z shares. On the business day after the
purchase order is received, Prudential Securities will place the order for
shares of the Series for settlement that day. Shares will be issued at the NAV
determined on that day and will begin earning dividends the next business day,
which is the second business day after receipt of the purchase order by
Prudential Securities. Prudential Securities will have the use of, and will
retain the benefits of, Eligible Credit Balances in the client's brokerage
account until monies are delivered to the Trust. (Prudential Securities delivers
Federal Funds on the business day after settlement).

16
<PAGE>

Purchase through Prusec

You may purchase shares of the Series by placing an order with your Prusec
registered representative accompanied by payment for the purchase price of such
shares and, in the case of a new account, a completed Application Form. You
should also submit an IRS Form W-9. The Prusec registered representative will
then forward these items to the Transfer Agent. See "Purchase By Mail" below.

Purchase by Wire

For an initial purchase of shares of the Series by wire, you must first
telephone PMFS at (800) 225-1852 (toll free) to receive an account number. The
following information will be requested: your name, address, tax identification
number, dividend distribution election, amount being wired and wiring bank.
Instructions should then be given by you to your bank to transfer funds by wire
to State Street Bank and Trust Company (State Street), Boston, Massachusetts
02205, Services Division, Attention: Prudential Government Securities Trust
(Money Market Series), specifying on the wire the account number assigned by
PMFS and your name and identify the class in which you are eligible to invest
(Class A or Class Z shares).

If you arrange for receipt by State Street of Federal Funds prior to 4:30
P.M., New York time, on a business day, you may purchase shares of the Series as
of that day and earn dividends commencing on the next business day.

In making a subsequent purchase order by wire, you should wire State Street
directly, and should be sure that the wire specifies Prudential Government
Securities Trust (Money Market Series) Class A or Class Z shares and your name
and individual account number. It is not necessary to call PMFS to make
subsequent purchase orders by wire. The minimum amount which may be invested by
wire is $1,000.

Purchase by Mail

Purchase orders for which remittance is to be made by check or money order
may be submitted directly by mail to Prudential Mutual Fund Services LLC,
Attention: Investment Services, P.O. Box 15020, New Brunswick, New Jersey
08906-5020, together with payment of the purchase price of such shares and, in
the case of a new account, a completed Application Form. You should also submit
an IRS Form W-9. If PMFS receives your order to purchase shares of the Series
and payment in proper form prior to 4:30 P.M., New York time, the purchase order
will be effective on that day and you will begin earning dividends on the
following business day. See "Taxes, Dividends and Distributions." Checks should
be made payable to Prudential Government Securities Trust (Money Market Series)
and should indicate Class A or Class Z shares. Certified checks are not
necessary, but checks are accepted subject to collection at full face value in
United States funds and must be drawn on a bank located in the United States.
There are restrictions on the redemption of shares purchased by check while the
funds are being collected. See "How to Sell Your Shares."

HOW TO SELL YOUR SHARES

Shares for which a redemption request is received prior to 4:30 P.M., New
York time, are entitled to a dividend on the day the request is received. By
pre-authorizing Expedited Redemption, you may arrange to have payment for
redeemed shares made in Federal Funds wired to your bank, normally on the next
bank business day following the date of receipt of the redemption instructions.
Should you redeem all of your shares, you will receive the amount of all
dividends declared for the month-to-date on those shares. See "Taxes, Dividends
and Distributions."

If redemption is requested by a corporation, partnership, trust or
fiduciary, written evidence of authority acceptable to the Transfer Agent must
be submitted before such request will be accepted. All correspondence and
documents concerning redemptions should be sent to the Trust in care of its
Transfer Agent, Prudential Mutual Fund Services LLC, Attention: Redemption
Services, P.O. Box 15010, New Brunswick, New Jersey 08906-5010.

17
<PAGE>

If the proceeds of the redemption (a) exceed $50,000, (b) are to be paid to
a person other than the record owner, (c) are to be sent to an address other
than the address on the Transfer Agent's records or (d) are to be paid to a
corporation, partnership, trust or fiduciary, the signature(s) on the redemption
request and on the certificates, if any, or stock power, must be guaranteed by
an "eligible guarantor institution." An "eligible guarantor institution"
includes any bank, broker, dealer or credit union. The Transfer Agent reserves
the right to request additional information from, and make reasonable inquiries
of, any eligible guarantor institution. For clients of Prusec a signature
guarantee may be obtained from the agency or office manager of most Prudential
Insurance and Financial Services or Preferred Services offices. In the case of
redemptions from a benefit plan that participates in the Prudential PruArray or
Smartpath Program, if the proceeds of the redemption are invested in another
investment option of such plan, in the name of the record holder and at the same
address as reflected in the Transfer Agent's records, a signature guarantee is
not required.

Normally, the Trust makes payment on the next business day for all shares of
the Series redeemed, but in any event, payment will be made within seven days
after receipt by PMFS of share certificates and/or of a redemption request in
proper form. However, the Trust may suspend the right of redemption or postpone
the date of payment (a) for any periods during which the New York Stock Exchange
is closed (other than for customary weekend or holiday closings), (b) for any
periods when trading in the markets the Series normally utilizes is closed or
restricted or an emergency exists as determined by the SEC so that disposal of
the investments of the Series or determination of its NAV is not reasonably
practicable, or (c) for such other periods as the SEC may permit for protection
of the shareholders of the Money Market Series.

Payment for redemption of recently purchased shares will be delayed until
the Trust or its Transfer Agent has been advised that the purchase check has
been honored, up to 10 calendar days from the time of receipt of the purchase
check by the Transfer Agent. Such delay may be avoided if shares are purchased
by wire or by certified or official bank check.

Redemption of Shares Purchased Through Prudential Securities

Prudential Securities has advised the Trust that it has established
procedures pursuant to which shares of the Series held by a Prudential
Securities client having a deficiency in his or her Prudential Securities
account will be redeemed automatically to the extent of that deficiency to the
nearest highest dollar. The amount of the redemption will be the lesser of (a)
the total net asset value of the Series' shares held in the client's Prudential
Securities account or (b) the deficiency in the client's Prudential Securities
account at the close of business on the date such deficiency is due.
Accordingly, a Prudential Securities client who wishes to pay for a securities
transaction or satisfy any other debit balance in his or her account other than
through such automatic redemption procedure must do so prior to the day of
settlement for such securities transaction or the date the debit balance is
incurred. In the case of certain automatic redemptions, where Prudential
Securities cannot anticipate debits in the brokerage account (e.g., checks
written against the account), Prudential Securities clients will not be entitled
to dividends declared on the date of redemption; such dividends will be retained
by Prudential Securities.

Redemption of Shares Purchased Through PMFS

If you purchase shares of the Series through PMFS, you may use Check
Redemption, Expedited Redemption or Regular Redemption. Prudential Securities
clients for whom Prudential Securities has purchased shares may not use such
services.

Regular Redemption. You may redeem your shares by sending a written request
to PMFS, Attention: Redemption Services, P.O. Box 15010, New Brunswick, New
Jersey 08906-5010. In this case, all share certificates must be endorsed by you
with signature guaranteed, as described above. PMFS may request further
documentation from corporations, executors, administrators, trustees or
guardians. Regular redemption is made by check mailed to the shareholder's
address.

18
<PAGE>

Expedited Redemption. By pre-authorizing Expedited Redemption, you may
arrange to have payment for redeemed shares made in Federal Funds wired to your
bank, normally on the next business day following redemption. In order to use
Expedited Redemption, you may so designate at the time the initial investment is
made or at a later date. Once an Expedited Redemption authorization form has
been completed, the signature on the authorization form guaranteed as set forth
above and the form returned to PMFS, requests for redemption may be made by
telegraph, letter or telephone. To request Expedited Redemption by telephone,
you should call PMFS at (800) 225-1852. Calls must be received by PMFS before
4:30 P.M., New York time, to permit redemption as of such date. Requests by
letter should be addressed to Prudential Mutual Fund Services LLC, Att:
Redemption Services, P.O. Box 15010, New Brunswick, New Jersey 08906-5010.

A signature guarantee is not required under Expedited Redemption once the
authorization form is properly completed and returned. The Expedited Redemption
privilege may be used to redeem shares in an amount of $200 or more, except that
if an account for which Expedited Redemption is requested has a net asset value
of less than $200, the entire account must be redeemed. The proceeds of redeemed
shares in the amount of $1,000 or more are transmitted by wire to your account
at a domestic commercial bank which is a member of the Federal Reserve System.
Proceeds of less than $1,000 are forwarded by check to your designated bank
account.

During periods of severe market or economic conditions, Expedited Redemption
may be difficult to implement and you should redeem your shares by mail as
described above.

Check Redemption. At your request, State Street will establish a personal
checking account for you. Checks drawn on this account can be made payable to
the order of any person in any amount greater than $500. When such check is
presented to State Street for payment, State Street presents the check to the
Trust as authority to redeem a sufficient number of shares of the Series in your
account to cover the amount of the check. If insufficient shares are in the
account or, if the purchase was made by check within 10 calendar days, the check
will be returned marked "insufficient funds." Checks in an amount less than $500
will not be honored. Shares for which certificates have been issued cannot be
redeemed by check. PMFS reserves the right to impose a service charge to
establish a checking account and order checks.

Involuntary Redemption

Because of the relatively high cost of maintaining an account, the Trust
reserves the right to redeem, upon 60 days' written notice, an account which is
reduced to an NAV of $500 or less due to a redemption. You may avoid such
redemption by increasing the NAV of your account to an amount in excess of $500.

Redemption in Kind

If the Trustees determine that it would be detrimental to the best interests
of the remaining shareholders of the Series to make payment wholly or partly in
cash, the Trust may pay the redemption price in whole or in part by a
distribution in kind of securities from the investment portfolio of the Series
in lieu of cash, in conformity with applicable rules of the SEC. Securities will
be readily marketable and will be valued in the same manner as in a regular
redemption. See "How the Trust Values its Shares." If your shares are redeemed
in kind, you would incur transaction costs in converting the assets into cash.
The Trust, however, has elected to be governed by Rule 18f-1 under the
Investment Company Act, under which the Trust is obligated to redeem shares
solely in cash up to the lesser of $250,000 or one percent of the net asset
value of the Trust during any 90-day period for any one shareholder.

90-Day Repurchase Privilege

If you redeem your shares and have not previously exercised the repurchase
privilege, you may reinvest any portion or all of the proceeds of such
redemption in shares of the Trust at the NAV next determined after the order is
received,

19
<PAGE>

which must be within 90 days after the date of the redemption. Any CDSC paid in
connection with such redemption will be credited (in shares) to your account.
(If less than a full repurchase is made, the credit will be on a pro rata
basis.) You must notify the Trust's Transfer Agent, either directly or through
Prudential Securities, at the time the repurchase privilege is exercised to
adjust your account for the CDSC you previously paid. Thereafter, any
redemptions will be subject to the CDSC applicable at the time of the
redemption. Exercise of the repurchase privilege will not affect the federal
income tax treatment of any gain realized upon the redemption. However, if the
redemption was made within a 30-day period of the repurchase and if the
redemption resulted in a loss, some or all of the loss, depending on the amount
reinvested, will not be allowed for federal income tax purposes.

Class B and Class C Purchase Privilege

You may direct that the proceeds of the redemption of your shares be
invested in Class B or Class C shares of any Prudential Mutual Fund by calling
your Prudential Securities financial adviser or the Transfer Agent at (800)
225-1852. The transaction will be effected on the basis of the relative NAV.

HOW TO EXCHANGE YOUR SHARES

As a shareholder of the Series, you may exchange your shares for shares of
other series of the Trust and certain other Prudential Mutual Funds, including
money market funds and funds sold with an initial sales charge, subject to the
minimum investment requirements of such funds on the basis of the relative NAV.
You may exchange your Class A or Class Z shares for Class A or Class Z shares,
respectively, of the Prudential Mutual Funds on the basis of the relative NAV,
plus the applicable sales charge. No additional sales charge is imposed in
connection with subsequent exchanges. You may not exchange your shares for Class
B shares of the Prudential Mutual Funds, except that shares acquired prior to
January 22, 1990 subject to a contingent deferred sales charge can be exchanged
for Class B shares. You may not exchange your shares for Class C shares of the
Prudential Mutual Funds. See "How to Sell Your Shares-Class B and Class C
Purchase Privilege" above and "Shareholder Investment Account-Exchange
Privilege" in the Statement of Additional Information. An exchange will be
treated as a redemption and purchase for tax purposes.

Class Z shareholders of the Series may exchange their Class Z shares for
Class Z shares of other Prudential Mutual Funds on the basis of relative net
asset value. Shareholders who qualify to purchase Class Z shares (other than
participants in any fee-based program) will have their Class A shares exchanged
for Class Z shares on a quarterly basis. Participants in any fee-based program
for which the Series is an available option will have their Class A shares, if
any, exchanged for Class Z shares when they elect to have those assets become a
part of the fee-based program. Upon leaving the program (whether voluntarily or
not), such Class Z shares (and, to the extent provided for in the program, Class
Z shares acquired through participation in the program) will be exchanged for
Class A shares at net asset value. Similarly, participants in the PSI 401(k)
Plan, an employee benefit plan sponsored by Prudential Securities (the PSI
401(k) Plan) for which the Series' Class Z shares are an available option and
who wish to transfer their Class Z shares out of the PSI 401(k) Plan following
separation from service (i.e., voluntary or involuntary termination of
employment or retirement) will have their Class Z shares exchanged for Class A
shares at net asset value.

In order to exchange shares by telephone, you must authorize telephone
exchanges on your initial application form or by written notice to the Transfer
Agent and hold shares in non-certificate form. Thereafter, you may call the
Trust at (800) 225-1852 to execute a telephone exchange of shares, on weekdays,
except holidays, between the hours of 8:00 A.M. and 6:00 P.M., New York time.
For your protection and to prevent fradulent exchanges, your telephone call will
be recorded and you will be asked to provide your personal identification
number. A written confirmation of the exchange transaction will be sent to you.
Neither the Trust nor its agents will be liable for any loss, liability or cost
which results from acting upon instructions reasonably believed to be genuine
under the foregoing procedures. (The Trust or its agents could be subject to
liability if they fail to employ reasonable procedures.) All exchanges will be
made on the basis of the relative NAV of the two funds (or series) next
determined after the request is received in good order. The Exchange Privilege
is available only in states where the exchange may legally be made.

20
<PAGE>

If you hold shares through Prudential Securities, you must exchange your
shares by contacting your Prudential Securities financial adviser. If you hold
certificates, the certificates, signed in the name(s) shown on the face of the
certificates, must be returned in order for the shares to be exchanged. See "How
to Sell Your Shares" above.

You may also exchange shares by mail by writing to Prudential Mutual Fund
Services LLC, Attention: Exchange Processing, P.O. Box 15010, New Brunswick, New
Jersey 08906-5010.

In periods of severe market or economic conditions the telephone exchange of
shares may be difficult to implement and you should make exchanges by mail by
writing to Prudential Mutual Fund Services LLC, at the address noted above.

The Series reserves the right to reject any exchange order including
exchanges (and market timing transactions) which are of a size and/or frequency
engaged in by one or more accounts acting in concert or otherwise, that have or
may have an adverse effect on the ability of a Subadviser to manage the relevant
portfolio. The determination that such exchanges or activity may have an adverse
effect and the determination to reject any exchange order shall be in the
discretion of the Manager and the Subadviser.

The Exchange Privilege may be modified or terminated at any time on 60 days'
notice to shareholders.

SHAREHOLDER SERVICES

In addition to the exchange privilege, as a shareholder in the Series, you
can take advantage of the following additional services and privileges:

* Automatic Reinvestment of Dividends and/or Distributions. For your
convenience, all dividends and distributions are automatically reinvested in
full and fractional shares of the Series at NAV. You may direct the Transfer
Agent in writing not less than 5 full business days prior to the record date to
have subsequent dividends and/or distributions sent in cash rather than
reinvested. If you hold your shares through Prudential Securities, you should
contact your financial adviser.

* Automatic Savings Accumulation Plan (ASAP). Under ASAP you may make
regular purchases of Series' shares in amounts as little as $50 via an automatic
charge to a bank account or Prudential Securities account (including a Command
Account). For additional information about this service, you may contact your
Prudential Securities financial adviser, Prusec representative or the Transfer
Agent directly.

* Tax-Deferred Retirement Plans. Various tax-deferred retirement plans,
including a 401(k) plan, self-directed individual retirement accounts and
"tax-sheltered accounts" under Section 403(b)(7) of the Internal Revenue Code
are available through the Distributor. These plans are for use by both
self-employed individuals and corporate employers. These plans permit either
self-direction of accounts by participants, or a pooled account arrangement.
Information regarding the establishment of these plans, the administration,
custodial fees and other details is available from Prudential Securities or the
Transfer Agent. If you are considering adopting such a plan, you should consult
with your own legal or tax adviser with respect to the establishment and
maintenance of such a plan.

* Systematic Withdrawal Plan. A systematic withdrawal plan is available for
shareholders which provides for monthly or quarterly checks. For additional
information about this service, you may contact your Prudential Securities
financial adviser, Prusec representative or the Transfer Agent directly.

21
<PAGE>

forms supplied by the Trust. Procedures are available to identify sub-accounts
by name and number within the master account name. The investment minimums set
forth above are applicable to the aggregate amounts invested by a group and not
to the amount credited to each sub-account.

* Reports to Shareholders. The Trust will send you the Series' annual and
semi-annual reports. The financial statements appearing in annual reports are
audited by independent accountants. In order to reduce duplicate mailing and
printing expenses the Trust will provide one annual report and semi-annual
shareholder report and annual prospectus per household. You may request
additional copies of such reports by calling (800) 225-1852 or by writing to the
Trust at Gateway Center Three, Newark, New Jersey 07102-4077.

* Shareholder Inquiries. Inquiries should be addressed to the Trust at
Gateway Center Three, Newark, New Jersey 07102-4077, or by telephone, at (800)
225-1852 (toll free) or, from outside the U.S.A., at (908) 417-7555 (collect).

For additional information regarding the services and privileges described
above, see "Shareholder Investment Account" in the Statement of Additional
Information.

22
<PAGE>

- --------------------------------------------------------------------------------
THE PRUDENTIAL MUTUAL FUND FAMILY
- --------------------------------------------------------------------------------

Prudential Mutual Fund Management offers a broad range of mutual funds
designed to meet your individual needs. We welcome you to review the investment
options available through our family of funds. For more information on the
Prudential Mutual Funds, including charges and expenses, contact your Prudential
Securities financial adviser or Prusec registered representative or telephone
the Trust at (800) 225-1852 for a free prospectus. Read the prospectus carefully
before you invest or send money.

(left column)

Taxable Bond Funds

Prudential Diversified Bond Fund, Inc.
Prudential Government Income Fund
Prudential Government Securities Trust
Short-Intermediate Term Series
Prudential High Yield Fund, Inc.
Prudential Mortgage Income Fund, Inc.
Prudential Structured Maturity Fund, Inc.
Income Portfolio
The BlackRock Government Income Trust

Tax-Exempt Bond Funds

Prudential California Municipal Fund
California Series
California Income Series
Prudential Municipal Bond Fund
High Yield Series
Insured Series
Intermediate Series
Prudential Municipal Series Fund
Florida Series
Hawaii Income Series
Maryland Series
Massachusetts Series
Michigan Series
New Jersey Series
New York Series
North Carolina Series
Ohio Series
Pennsylvania Series
Prudential National Municipals Fund, Inc.

Global Funds

Prudential Emerging Growth Fund, Inc.
Prudential Europe Growth Fund, Inc.
Prudential Global Genesis Fund, Inc.
Prudential Global Limited Maturity Fund, Inc.
Limited Maturity Portfolio
Prudential Intermediate Global Income Fund, Inc.
Prudential Natural Resources Fund, Inc.
Prudential Pacific Growth Fund, Inc.
Prudential World Fund, Inc.
Global Series
International Stock Series
Global Utility Fund, Inc.
The Global Government Plus Fund, Inc.
The Global Total Return Fund, Inc.

(right column)

Equity Funds

Prudential Allocation Fund
Balanced Portfolio
Strategy Portfolio
Prudential Distressed Securities Fund, Inc.
Prudential Dryden Fund
Prudential Active Balanced Fund
Prudential Stock Index Fund
Prudential Emerging Growth Fund, Inc.
Prudential Equity Fund, Inc.
Prudential Equity Income Fund
Prudential Jennison Series Fund, Inc.
Prudential Jennison Growth Fund
Prudential Jennison Growth & Income Fund
Prudential Multi-Sector Fund, Inc.
Prudential Small Companies Fund, Inc.
Prudential Utility Fund, Inc.
Nicholas-Applegate Fund, Inc.
Nicholas-Applegate Growth Equity Fund

Money Market Funds

* Taxable Money Market Funds
Prudential Government Securities Trust
Money Market Series
U.S. Treasury Money Market Series
Prudential Special Money Market Fund, Inc.
Money Market Series
Prudential MoneyMart Assets, Inc.

* Tax-Free Money Market Funds
Prudential Tax-Free Money Fund, Inc.
Prudential California Municipal Fund
California Money Market Series
Prudential Municipal Series Fund
Connecticut Money Market Series
Massachusetts Money Market Series
New Jersey Money Market Series
New York Money Market Series

* Command Funds
Command Money Fund
Command Government Fund
Command Tax-Free Fund

* Institutional Money Market Funds
Prudential Institutional Liquidity Portfolio, Inc.
Institutional Money Market Series

A-1
<PAGE>

(left column)

No dealer, sales representative or any other person has been
authorized to give any information or to make any represen-
tations, other than those contained in this Prospectus, in
connection with the offer contained in this Prospectus, and,
if given or made, such other information or representations
must not be relied upon as having been authorized by the
Trust or the Distributor. This Prospectus does not
constitute an offer by the Trust or by the Distributor to
sell or a solicitation of an offer to buy any of the
securities offered hereby in any jurisdiction to any person
to whom it is unlawful to make such offer in such
jurisdiction.

TABLE OF CONTENTS

Page
----
TRUST HIGHLIGHTS................................. 2
What are the Series' Risk Factors
and Special Characteristics? ............... 2
TRUST EXPENSES................................... 4
FINANCIAL HIGHLIGHTS............................. 5
CALCULATION OF YIELD............................. 7
HOW THE TRUST INVESTS............................ 7
Investment Objectives and Policies............ 7
Other Investments and Policies................ 8
Investment Restrictions ...................... 9
HOW THE TRUST IS MANAGED......................... 9
Manager....................................... 9
Distributor................................... 10
Portfolio Transactions........................ 11
Custodian and Transfer and
Dividend Disbursing Agent................. 11
HOW THE TRUST VALUES ITS SHARES.................. 11
TAXES, DIVIDENDS AND DISTRIBUTIONS............... 12
GENERAL INFORMATION.............................. 13
Description of Shares......................... 13
Additional Information........................ 14
SHAREHOLDER GUIDE................................ 14
How to Buy Shares of the Trust................ 14
How to Sell Your Shares....................... 17
How to Exchange Your Shares................... 20
Shareholder Services ......................... 21
THE PRUDENTIAL MUTUAL FUND FAMILY................ A-1

100A 430144C

- -----------------------------------------------------
Class A: 744342 20 5
CUSIP Nos.:
Class Z: 744342 40 3
- -----------------------------------------------------

(right column)

Prudential
Government
Securities
Trust

- -------------------------
Money Market Series

PROSPECTUS

February 3, 1997

(LOGO)
<PAGE>

Prudential Government Securities Trust
(U.S. Treasury Money Market Series)

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

Prospectus dated February 3, 1997

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

The investment objective of the U.S. Treasury Money Market Series (the Series)
is high current income consistent with the preservation of principal and
liquidity. The Series seeks to achieve its objective by investing exclusively in
U.S. Treasury obligations which have maturities of thirteen months or less.
Interest on U.S. Treasury obligations is specifically exempted from state and
local income taxes under federal law. All states allow the character of the
Series' income to pass through to the dividends distributed to its shareholders.
Interest on U.S. Treasury obligations is not exempt from federal income tax.
There can be no assurance that the Series' investment objective will be
achieved. See "How the Trust Invests-Investment Objective and Policies" and
"Taxes, Dividends and Distributions."

The Trust's address is Gateway Center Three, Newark, New Jersey 07102-4077, and
its telephone number is (800) 225-1852.

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

This Prospectus sets forth concisely the information about the Trust and the
Series that a prospective investor should know before investing. Additional
information about the Trust and the Series has been filed with the Securities
and Exchange Commission in a Statement of Additional Information, dated February
3, 1997, which information is incorporated herein by reference (is legally
considered a part of this Prospectus) and is available without charge upon
request to the Trust at the address or telephone number noted above.

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

Investors are advised to read this Prospectus and retain it for future
reference.

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

<PAGE>

- --------------------------------------------------------------------------------
TRUST HIGHLIGHTS
- --------------------------------------------------------------------------------

The following summary is intended to highlight certain information contained
in this prospectus and is qualified in its entirety by the more detailed
information appearing elsewhere herein.

- --------------------------------------------------------------------------------
What is Prudential Government Securities Trust?

Prudential Government Securities Trust is a mutual fund whose shares are
offered in three series, each of which operates as a separate fund. A mutual
fund pools the resources of investors by selling its shares to the public and
investing the proceeds of such sale in a portfolio of securities designed to
achieve its investment objective. Technically, the Trust is an open-end,
diversified management investment company. Only the U.S. Treasury Money Market
Series is offered through this Prospectus.

What is the Series' Investment Objective?

The Series' investment objective is high current income consistent with the
preservation of principal and liquidity. The Series invests exclusively in U.S.
Treasury obligations which have effective maturities of thirteen months or less.
There can be no assurance that the Series' investment objective will be
achieved. See "How the Trust Invests-Investment Objective and Policies" at page
6.

What are the Series' Risk Factors and Special Characteristics?

It is anticipated that the net asset value of the Series will remain
constant at $1.00 per share, although this cannot be assured. In order to
maintain such constant net asset value, the Series will value its portfolio
securities at amortized cost. While this method provides certainty in valuation,
it may result in periods during which the value of a security in the Series'
portfolio, as determined by amortized cost, is higher or lower than the price
the Series would receive if it sold such security. See "How the Trust Values its
Shares" at page 10.

Who Manages the Trust?

Prudential Mutual Fund Management LLC (PMF or the Manager) is the Manager of
the Trust and is compensated for its services at an annual rate of .40 of 1% of
the Series' average daily net assets. As of December 31, 1996, PMF served as
manager or administrator to 62 investment companies, including 40 mutual funds,
with aggregate assets of approximately $55.2 billion. The Prudential Investment
Corporation (PIC, the Subadviser or the investment adviser) furnishes investment
advisory services in connection with the management of the Trust under a
Subadvisory Agreement with PMF. See "How the Trust is Managed-Manager" at page
8.

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

<PAGE>

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

Who Distributes the Series' Shares?

Prudential Securities Incorporated (Prudential Securities or PSI), a major
securities underwriter and securities and commodities broker, acts as the
Distributor of the Series' shares and is paid an annual service fee at the rate
of .125 of 1% of the average daily net assets of the Series' Class A shares.
Prudential Securities incurs the expense of distributing the Series' Class Z
shares under a Distribution Agreement with the Trust, none of which is
reimbursed or paid for by the Trust. Prior to January 2, 1996, Prudential Mutual
Fund Distributors, Inc. (PMFD) acted as the Distributor of the Series' shares.
See "How the Trust is Managed-Distributor" at page 9.

What is the Minimum Investment?

The minimum initial investment for Class A shares is $2,500. The subsequent
minimum investment for Class A shares is $100. There is no minimum initial or
subsequent investment requirement for investors who qualify to purchase Class Z
shares. There is no minimum investment requirement for the Command Account
Program (if the Series is designated as your primary fund) and certain
retirement and employee savings plans or custodial accounts for the benefit of
minors. For purchases made through the Automatic Savings Accumulation Plan, the
minimum initial and subsequent investment is $50. See "Shareholder Guide-How to
Buy Shares of the Trust" at page 13 and "Shareholder Guide-Shareholder Services"
at page 21.

How Do I Purchase Shares?

You may purchase shares of the Series through Prudential Securities, Pruco
Securities Corporation (Prusec) or directly from the Trust, through its transfer
agent, Prudential Mutual Fund Services LLC (PMFS or the Transfer Agent) at the
net asset value per share (NAV) next determined after receipt of your purchase
order by the Transfer Agent or Prudential Securities. Class Z shares are offered
to a limited group of investors at net asset value without any sales charge. See
"How the Trust Values its Shares" at page 10 and "Shareholder Guide-How to Buy
Shares of the Trust" at page 13.

How Do I Sell My Shares?

How Are Dividends and Distributions Paid?

<PAGE>

- --------------------------------------------------------------------------------
TRUST EXPENSES-U.S. TREASURY MONEY MARKET SERIES
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shareholder Transaction Expenses Class A Shares Class Z Shares
-------------- --------------
<S> <C> <C>