PIONEER INTEREST SHARES, DEF 14A, 1997-07-17

PIONEER INTEREST SHARES
DEF 14A, 1997-07-17

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File No. 2-42352
File No. 811-2239

SCHEDULE 14A
(RULE 14A-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION

PROXY STATEMENT PURSUANT TO SECTION 14(A)
OF THE SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. )

Filed by the registrant [X]

Check the appropriate box:

[ ] Preliminary proxy statement [ ] Confidential, for Use
of the Commission
Only (as permitted
by Rule 14a-6(e)(2))

[X] Definitive proxy statement

[ ] Definitive additional materials

[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12

PIONEER INTEREST SHARES
(Name of Registrant as Specified in Its Charter

PIONEER INTEREST SHARES
(Name of Person(s) Filing Proxy Statement)

<PAGE>

PIONEER INTEREST SHARES
60 STATE STREET
BOSTON, MASSACHUSETTS 02109

1-800-622-3265

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD TUESDAY, SEPTEMBER 16, 1997

The Annual Meeting of Shareholders (the "Meeting") of Pioneer Interest
Shares, a Delaware business trust (the "Fund"), will be held at the offices of
Hale and Dorr LLP, counsel to the Fund, at 60 State Street, 26th floor, Boston,
Massachusetts 02109 on Tuesday, September 16, 1997 at 2:00 p.m. (Boston time) to
consider and act upon the following proposals:

1. To elect the nine (9) Trustees named in the attached Proxy
Statement to serve on the Fund's Board of Trustees until their
successors have been duly elected and qualified;

2. To ratify the selection of Arthur Andersen LLP as the Fund's
independent public accountants for the fiscal year ending December
31, 1997; and

3. To transact such other business as may properly come before the
Meeting or any adjournment thereof.

Shareholders of record as of the close of business on July 8, 1997, are
entitled to vote at the Meeting or any adjournment thereof.

By Order of the Board of Trustees,
Joseph P. Barri, Secretary

Boston, Massachusetts
July 18, 1997

WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE MEETING, PLEASE COMPLETE AND
RETURN THE ENCLOSED PROXY CARD. YOU MAY STILL VOTE IN PERSON IF YOU ATTEND THE
MEETING.

097-4317
<PAGE>

PIONEER INTEREST SHARES
60 STATE STREET
BOSTON, MASSACHUSETTS 02109

1-800-622-3265

PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
SEPTEMBER 16, 1997

INTRODUCTION

This Proxy Statement is furnished to shareholders of Pioneer Interest
Shares, a Delaware business trust (the "Fund"), in connection with the
solicitation of proxies by the Fund's Board of Trustees for use at the Annual
Meeting of Shareholders (the "Meeting") to be held at the offices of Hale and
Dorr LLP, counsel to the Fund, at 60 State Street, 26th floor, Boston,
Massachusetts 02109 on Tuesday, September 16, 1997 at 2:00 p.m. (Boston time)
and at any adjournment thereof, for the purposes set forth in the accompanying
Notice of Annual Meeting of Shareholders.

The attached Notice, this Proxy Statement (the "Proxy Statement") and the
enclosed proxy card are being mailed to shareholders on or after July 18, 1997.
THE FUND'S ANNUAL REPORT FOR ITS FISCAL PERIOD ENDED DECEMBER 31, 1996 WAS
MAILED TO SHAREHOLDERS ON OR ABOUT FEBRUARY 28, 1997. ADDITIONAL COPIES MAY BE
OBTAINED FREE OF CHARGE BY WRITING TO THE FUND AT ITS EXECUTIVE OFFICES, 60
STATE STREET, BOSTON, MASSACHUSETTS 02109 OR BY CALLING 1-800-225-6292.

Shareholders of record as of the close of business on July 8, 1997 (the
"Record Date") are entitled to vote on all business of the Meeting or any
adjournments thereof. As of the Record Date, 7,351,678 shares of beneficial
interest of the Fund were outstanding. To the knowledge of the management of the
Fund, no person beneficially owned more than 5% of the outstanding shares of the
Fund as of July 8, 1997 except that Cede and Co., Box 20, Bowling Green Station,
New York, NY 10004-0001, held 4,526,656 shares as nominee.

1
<PAGE>

PROPOSAL 1.
ELECTION OF BOARD OF TRUSTEES

The persons named on the accompanying proxy card intend to vote at the
Meeting (unless otherwise directed) FOR the election of the nine (9) nominees
named below as Trustees of the Fund. All of the nominees currently serve as
Trustees.

Each Trustee will be elected to hold office until the next meeting of
shareholders or until his or her successor is elected and qualified. Each
nominee has consented to being named herein and indicated his or her willingness
to serve if elected. If any such nominee should be unable to serve, an event not
now anticipated, the persons named as proxies may vote for such other person as
shall be designated by the Board of Trustees.

The following table sets forth each nominee's position(s) with the Fund,
age, address, principal occupation or employment during the past five years;
trusteeships and directorships; and indicates the date on which he or she first
became a Trustee of the Fund. The table also shows the number of shares of
beneficial interest of the Fund beneficially owned by each nominee, directly or
indirectly, on May 30, 1997.

<TABLE>
<CAPTION>
SHARES OF BENEFICIAL
INTEREST OF THE FUND
BENEFICIALLY OWNED AND
NAME, AGE, PRINCIPAL OCCUPATION FIRST PERCENTAGE OF TOTAL
POSITION(S) WITH THE OR EMPLOYMENT BECAME A SHARES OUTSTANDING ON
FUND AND ADDRESS AND DIRECTORSHIPS/TRUSTEESHIPS(1) TRUSTEE MAY 30, 1997(2)
---------------- --------------------------------- ------- ---------------
<S> <C> <C> <C>

JOHN F. COGAN, JR., 71*. President, Chief Executive Officer, 1993 1,000
Chairman of the Board, Chairman of the Board, and a (0.0)%
President and Trustee Director of The Pioneer Group,
60 State Street Inc., a public company ("PGI");
Boston, MA 02109 Chairman and a Director of
Pioneering Management
Corporation ("PMC"), Pioneer
Funds Distributor, Inc. ("PFD"),
Pioneer Goldfields Limited
("PGL") and Teberebie Goldfields
Limited; Director of Pioneering
Services Corporation ("PSC"),
Pioneer Capital Corporation
("PCC") and Forest-Starma (a
Russian timber joint venture);
President and Director of Pioneer
Plans Corporation ("PPC"),
Pioneer Investment Corporation
("PIC"), Pioneer Metals and
Technology, Inc. ("PMT"), Pioneer
First Russia, Inc., Pioneer Omega,
Inc. ("Omega") and Theta Enterprises,
Inc. and Pioneer International
Corporation ("P.Intl.") Luscina,
Inc.; Chairman Of The Supervisory
Board Of Pioneer Fonds

</TABLE>

2
<PAGE>

Marketing Gmbh ("Pioneer Gmbh");
Member Of The Supervisory Board Of
Pioneer First Polish Trust Fund Joint
Stock Company, S.a. ("Pfpt") and
Pioneer Czech Investment Company,
A.s.; and Partner, Hale And Dorr Llp

(Counsel to the Fund)

MARY K. BUSH, 49 .... President, Bush & Co., an 1997 -0-
Trustee International Financial
4201 Cathedral Ave. NW Advisory firm, since 1991;
Apt. 1016E Director/ Trustee of Mortgage
Washington, DC 20016 Guaranty Insurance Corporation,
Novecon Management Company, Hoover
Institution, Folger Shakespeare
Library, March of Dimes, Project
2000, Inc., Small Enterprise
Assistance Fund and Wilberforce
University; Washington Mutual
Investors Fund, a registered
investment company; U.S. Alternate
Executive Director, International
Monetary Fund (1984-1988); and
Managing Director, Federal Housing
Finance Board (1989-1991).

RICHARD H. EGDAHL, M.D., Professor of Management, Boston 1993 1,000

70 University School of Management;
Trustee Professor of Public Health, Boston
Boston University University School of Public
Health Policy Institute Health; Professor of Surgery,
53 Bay State Road Boston University School of
Boston, MA 02115 Medicine; Director, Boston
University Health Policy
Institute and University Medical
Center; Executive Vice President
and Vice Chairman of the Board,
University Hospital; Academic
Vice President for Health Affairs,
Boston University; Director,
Essex Investment Management
Company, Inc., an investment
adviser, Health Payment Review,
Inc., a health care containment
software firm, Mediplex Group,
Inc., a nursing care facilities
firm, Peer Review Analysis, Inc.,
a health care utilization
management firm, and
Springer-Verlag New York, Inc., a
publisher; and Honorary Director,
Franciscan Children's Hospital
</TABLE>

3
<PAGE>

MARGARET B.W. GRAHAM, 50 Founding Director, Winthrop Group, 1993 -0-
Trustee Inc., a consulting firm, since
The Keep 1982; Manager of Research
P.O. Box 110 Operations, Xerox Palo Alto
Little Deer Isle, Research Center, between 1991 and
ME 04650 1994; and Professor of Operations
Management and Management of
Technology, Boston University
School of Management, between 1989
and 1993

John W. Kendrick, 80 ... Professor Emeritus of Economics, 1993 300

Trustee George Washington University; and (0.0)%
6363 Waterway Dr. Economic Consultant and Director,
Falls Church, VA 22044 American Productivity and Quality
Center

Marguerite A. Piret, 49. President, Newbury, Piret & Company, 1993 100
Trustee Inc., a merchant banking firm (0.0)%
One Boston Place
Suite 2635
Boston, MA 02108

David D. Tripple, 53* .. Director and Executive Vice 1993 100
Executive Vice President President of PGI; President, Chief (0.0)%
and Trustee Investment Officer and a Director
60 State Street of PMC; Director of PFD, PCC,
Boston, MA 02109 Pioneer SBIC Corporation, Pioneer
First Russia, Inc., Pioneer Omega,
Inc., P. Intl. and PIC; and Member
of the Supervisory Board of PFPT
Stephen K. West, 68 .... Partner, Sullivan & Cromwell, a law 1993 300
Trustee firm (0.0)%
125 Broad Street
New York, NY 10004

John Winthrop, 61 ...... President, John Winthrop & Co., a 1993 101
Trustee private investment firm; Director (0.0)%
One North Adgers Wharf of NUI Corp.; and Trustee of
Charleston, SC 29401 Alliance Capital Reserve,
Alliance Government Reserve and
Alliance Tax Exempt Reserve
</TABLE>

* Messrs. Cogan and Tripple are "interested persons" of the Fund, PMC and PFD
within the meaning of the Investment Company Act of 1940, as amended (the
"1940 Act").

(1) Each nominee also serves as a trustee for each of the 20 open-end investment
companies (mutual funds) in the Pioneer family of mutual funds and for each
of the eight portfolios of the Pioneer Variable Contracts Trust (except
Messrs. Kendrick and Winthrop and Mesdames Bush and Graham who do not serve
as Trustees for Pioneer Variable Contracts Trust). Except for Ms. Bush who
was elected by the other Trustees in June, 1997, each Trustee was elected by
the shareholders of the Fund in 1996.

(2) As of May 30, 1997, the Trustees and officers of the Fund beneficially
owned, directly or indirectly, in the aggregate less than 1% of the Fund's
outstanding shares.

4
<PAGE>

Ms. Piret, Mr. West and Mr. Winthrop serve on the Audit Committee of the
Board of Trustees. The functions of the Audit Committee include recommending
independent auditors to the Trustees, monitoring the independent auditors'
performance, reviewing the results of audits and responding to certain other
matters deemed appropriate by the Trustees. Ms. Graham, Ms. Piret and Mr.
Winthrop also serve on the Nominating Committee of the Board of Trustees. The
primary responsibility of the Nominating Committee is the selection and
nomination of candidates to serve as independent trustees. The Nominating
Committee will also consider nominees recommended by shareholders to serve as
Trustees provided that shareholders submitting such recommendations comply with
all relevant provisions of Rule 14a-8 under the Securities Exchange Act of 1934,
as amended (the "Exchange Act").

During the fiscal year ended December 31, 1996, the Board of Trustees held
12 meetings, the Audit Committee held 11 meetings and the Nominating Committee
did not meet. All of the current Trustees and Committee Members then serving
attended at least 75% of the meetings of the Board of Trustees or applicable
committee, if any, held during the fiscal year ended December 31, 1996.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Under the Securities Exchange Act and the Rules thereunder, trustees of
closed-end investment companies are required to report transactions in a fund's
shares to the Securities and Exchange Commission (the "Commission") on various
specified forms. A report on Form 4 was not timely filed with the Commission
with respect to Dr. Egdahl's initial purchase of shares of the Fund. The
untimely filing of the Form 4 was inadvertent and the subject transaction does
not raise concerns under Section 16 of the Exchange Act.

OTHER EXECUTIVE OFFICERS

In addition to Messrs. Cogan and Tripple, who serve as executive officers of
the Fund, the following table provides information with respect to the other
executive officers of the Fund. Each executive officer is elected by the Board
of Trustees and serves until his successor is chosen and qualified or until his
resignation or removal by the Board. The business address of all officers of the
Fund is 60 State Street, Boston, Massachusetts 02109.

<TABLE>
<CAPTION>
NAME, AGE AND
POSITION WITH THE FUND PRINCIPAL OCCUPATION(S)
<S> <C>
WILLIAM H. KEOUGH, 60,..... Senior Vice President, Chief Financial
Treasurer Officer and Treasurer of PGI and Treasurer
of PFD, PMC, PSC, PPC, Pioneer SBIC
Corporation, PIC, PMT, PIntl. and each
fund in the Pioneer family of mutual funds.

Joseph P. Barri, 51,....... Secretary of PGI, PMC, PPC, PIC, PIntl, PMT,
Secretary First Russia, Omega and PCC and each fund
in the Pioneer family of mutual funds;
Clerk of PFD and PSC and Partner, Hale
and Dorr LLP (counsel to the Fund).
</TABLE>

5
<PAGE>

REMUNERATION OF TRUSTEES AND OFFICERS

The following table provides information regarding the compensation paid by
the Fund and the other investment companies in the Pioneer family of mutual
funds to the Trustees for their services as indicated below. Compensation paid
by the Fund to Messrs. Cogan and Tripple, interested persons of PMC, is
reimbursed to the Fund by PMC. The Fund pays no salary or other compensation to
its officers.

<TABLE>
<CAPTION>
TOTAL COMPENSATION
FROM THE FUND
AGGREGATE AND OTHER FUNDS IN
COMPENSATION THE PIONEER FAMILY
TRUSTEE FROM THE FUND+ OF MUTUAL FUNDS++
<S> <C> <C>
John F. Cogan, Jr. $500 $11,083
Mary K. Bush* -0- -0-
Richard H. Egdahl, M.D. 1,915 59,858
Margaret B.W. Graham 2,015 59,858
John W. Kendrick 2,015 59,858
Marguerite A. Piret 2,316 79,842
David D. Tripple 500 11,083
Stephen K. West 2,142 67,850
John Winthrop 2,128 66,442
Totals $13,531 $415,874
</TABLE>

+ For the fiscal year ended December 31, 1996.

++ For the calendar year ended December 31, 1996.

* Ms. Bush was first elected as a Trustee in June, 1997.

INVESTMENT ADVISER

PMC, whose executive offices are located at 60 State Street, Boston,
Massachusetts 02109, serves as investment adviser to the Fund.

PMC is a wholly owned subsidiary of PGI. As of May 30, 1997, Mr. Cogan
beneficially owned 3,580,901 shares (14.05%) of the outstanding Common Stock of
PGI. Mr. Cogan's beneficial holdings included 727,136 shares held in trusts with
respect to which Mr. Cogan may be deemed to be a beneficial owner by reason of
his interest as a beneficiary and/or position as a trustee and shares which Mr.
Cogan has the right to acquire under outstanding options within sixty days of
May 30, 1997. At such date, Robert L. Butler and David D. Tripple, PMC's other
directors, each owned beneficially less than 2% of the outstanding Common Stock
of PGI. As of May 30, 1997 officers and directors of PMC and Trustees and
officers of the Fund beneficially owned an aggregate of 4,482,650 shares of
Common Stock of PGI, approximately 17.17% of the outstanding common Stock of
PGI. During PGI's fiscal year ended December 31, 1996, there were no
transactions in PGI Common Stock by any officer, Trustee or nominee for election
as Trustee of the Fund, PMC and/or PFD in an amount equal to or exceeding 1% of
the outstanding Common Stock of PGI.

6
<PAGE>

REQUIRED VOTE

In accordance with the Fund's Agreement and Declaration of Trust, the vote
of a plurality of all of the shares of the Fund voted at the Meeting is
sufficient to elect the nominees.

PROPOSAL 2.
RATIFICATION OF SELECTION OF INDEPENDENT PUBLIC ACCOUNTANTS

The firm of Arthur Andersen LLP has served as the Fund's independent public
accountant since 1994. Audit services during the fiscal year ending December 31,
1997 will consist of examinations of the Fund's financial statements and reviews
of the Fund's filings with the Commission.

The Board of Trustees, including a majority of the Trustees who are not
"interested persons" of the Fund or PMC, has selected Arthur Andersen LLP as the
Fund's independent public accountants for the fiscal year ending December 31,
1997, subject to shareholder ratification at the Meeting. A representative of
Arthur Andersen LLP is expected to be available at the Meeting to make a
statement if he or she desires to do so and to respond to appropriate questions.
Arthur Anderson LLP has advised the Fund that it has no direct or indirect
financial interest in the Fund.

REQUIRED VOTE

The ratification of the selection of Arthur Andersen LLP as the Fund's
independent public accountants for the fiscal year ending December 31, 1997
requires the affirmative vote of a majority of the shares of the Fund, present
in person or by proxy and entitled to vote at the Meeting.

THE TRUSTEES RECOMMEND THAT THE SHAREHOLDERS VOTE IN FAVOR OF THE
RATIFICATION OF ARTHUR ANDERSEN LLP AS THE FUND'S INDEPENDENT PUBLIC ACCOUNTANTS
FOR THE FISCAL YEAR ENDING DECEMBER 31, 1997.

OTHER MATTERS

SHAREHOLDER PROPOSALS

Shareholder proposals to be presented at the next meeting of shareholders,
whenever held, must be received at the Fund's offices, 60 State Street, Boston,
Massachusetts 02109, at a reasonable time prior to the Trustees' solicitation of
proxies for such meeting and must comply with the requirements of Rule 14a-8
under the Exchange Act. The Fund currently expects to hold the next annual
shareholders' meeting on or about June 16, 1998, which date is subject to
change.

PROXIES, QUORUM AND VOTING AT THE MEETING

Any person giving a proxy has the power to revoke it at any time prior to
its exercise by executing a superseding proxy or by submitting a notice of
revocation to the Secretary of the Fund. In addition, although mere attendance
at the Meeting will

7
<PAGE>

not revoke a proxy, a shareholder present at the Meeting may withdraw his or her
proxy and vote in person. All properly executed and unrevoked proxies received
in time for the Meeting will be voted in accordance with the instructions
contained in the proxies. If no instruction is given, the persons named as
proxies will vote the shares represented thereby in favor of the Proposals
described above and will use their best judgment in connection with the
transaction of such other business as may properly come before the Meeting or
any adjournment thereof.

A majority of the shares entitled to vote -- present in person or
represented by proxy -- constitutes a quorum for the transaction of business
with respect to any Proposal (unless otherwise noted in the Proxy Statement). In
the event that at the time any session of the Meeting is called to order and a
quorum is not present in person or by proxy, the persons named as proxies may
vote those proxies which have been received to adjourn such Meeting to a later
date. In the event that a quorum is present at the Meeting but sufficient votes
in favor of any Proposal, including the electing of the nominees to the Board of
Trustees, have not been received, the persons named as proxies may propose one
or more adjournments of such Meeting to permit further solicitation of proxies
with respect to such Proposal. Any such adjournment will require the affirmative
vote of a majority of the shares present in person or by proxy at the session of
the Meeting to be adjourned. The persons named as proxies will vote those
proxies which they are entitled to vote in favor of any such Proposal in favor
of such adjournment and will vote those proxies required to be voted against any
such Proposal against such adjournment. A shareholder vote may be taken on one
or all of the Proposals prior to such adjournment if sufficient votes for the
Proposal's approval have been received and it is otherwise appropriate. Such
vote will be considered final regardless of whether the Meeting is adjourned to
permit additional solicitation with respect to any other Proposal.

Shares of the Fund represented at the Meeting (including shares which
abstain or do not vote with respect to one or more of the Proposals) will be
counted for purposes of determining whether a quorum is present at the Meeting.
Abstentions will be treated as shares that are present and entitled to vote for
purposes of determining the number of shares that are present and entitled to
vote with respect to any particular Proposal, but will not be counted as a vote
in favor of such Proposal. Accordingly, an abstention from voting on a Proposal
has the same legal effect as a vote against the Proposal.

If a broker or nominee holding shares in "street name" indicates on the
proxy that it does not have discretionary authority to vote as to any Proposal,
those shares will not be considered present and entitled to vote as to that
Proposal. Accordingly, a "broker non-vote" has no effect on the voting in
determining whether a proposal has been adopted. In general, brokers or nominees
are given discretionary authority to vote shares held in street name with
respect to the election of trustees/directors and the ratification of auditors.

8
<PAGE>

OTHER BUSINESS

While the Meeting has been called to transact any business that may properly
come before it, the only matters that the Trustees intend to present are those
matters stated in the attached Notice of Annual Meeting of Shareholders.
However, if any additional matters properly come before the Meeting, and on all
matters incidental to the conduct of the Meeting, it is the intention of the
persons named in the enclosed proxy to vote the proxy in accordance with their
judgment on such matters unless instructed to the contrary.

METHODS OF SOLICITATION AND EXPENSES

The cost of preparing, assembling and mailing this proxy statement and the
attached Notice of Annual Meeting of Shareholders and the accompanying proxy
card will be borne by the Fund. In addition to soliciting proxies by mail, the
Fund may, at its expense, have one or more of its officers, representatives or
compensated third-party agents, including PMC, PSC and PFD, aid in the
solicitation of proxies by personal interview or telephone and telegraph and may
request brokerage houses and other custodians, nominees and fiduciaries to
forward proxy soliciting materials to the beneficial owners of the shares held
of record by such persons.

The Fund may also arrange to have votes recorded by telephone. The telephone
voting procedure is designed to authenticate shareholders' identities, to allow
shareholders to authorize the voting of their shares in accordance with their
instructions and to confirm that their instructions have been properly recorded.
The Fund has been advised by counsel that these procedures are consistent with
the requirements of applicable law. If these procedures were subject to a
successful legal challenge, such votes would not be counted at the Meeting. The
Fund is unaware of any such challenge at this time. Shareholders would be called
at the phone number PSC has in its records for their accounts, and would be
asked for their Social Security number or other identifying information. The
shareholders would then be given an opportunity to authorize proxies to vote
their shares at the Meeting in accordance with their instructions. To ensure
that the shareholders' instructions have been recorded correctly, they will also
receive a confirmation of their instructions in the mail. A special toll-free
number will be available in case the information contained in the confirmation
is incorrect.

Persons holding shares as nominees will be reimbursed by the Fund, upon
request, for the reasonable expense of mailing soliciting materials to the
principals of the accounts.

PIONEER INTEREST SHARES

July 18, 1997

9
<PAGE>
Pioneer Interest Shares
60 State Street
Boston, MA 02109-1820

July 1997

Dear Shareowner,

I am writing to let you know that the annual meeting for shareowners of Pioneer
Interest Shares will be held September 16, 1997. As a shareowner in the Fund,
you have the opportunity to voice your opinion on a number of important
proposals.

This package contains information about the proposals, along with the proxy card
for you to use when voting by mail. Please take a moment to read the enclosed
materials and cast your vote on the proxy card.

Your prompt vote will help save the Fund money. If a majority of the Fund's
shareowners have not voted prior to the meeting, we must try to obtain their
votes with additional mailings or phone solicitation. That is a costly process.

(callout in margin) VOTING YOUR SHARES BY MAIL IS QUICK AND EASY. EVERYTHING YOU
NEED IS ENCLOSED.

Each of the proposals up for approval has been reviewed by Pioneer Interest
Shares' Board of Trustees, whose primary role is to protect your interests as a
shareowner. In the Trustees' opinion, the proposals are fair and reasonable. The
Trustees recommend that you vote FOR each proposal.

(callout in margin) THE FUND'S BOARD OF TRUSTEES RECOMMENDS THAT YOU VOTE FOR
EACH PROPOSAL.

HERE IS WHAT A FOR VOTE MEANS FOR EACH OF THE PROPOSALS BEING CONSIDERED.

PROPOSAL 1
ELECT NINE TRUSTEES TO THE BOARD. The Trustees supervise the Fund's activities
and review contractual arrangements with companies that provide services to the
Fund. Eight of the nominees previously were elected by shareowners. The ninth,
Mary K. Bush, was elected by the other Trustees; the proxy statement includes
detailed information about all nominees.

PROPOSAL 2
RATIFY THE SELECTION OF ARTHUR ANDERSEN LLP AS THE FUND'S INDEPENDENT PUBLIC
ACCOUNTANTS FOR THE FISCAL YEAR ENDING DECEMBER 31, 1997.

Cast your vote by completing and signing the proxy card enclosed in this
package. Please mail your completed and signed proxy card as quickly as possible
using the postage-paid envelope provided. Thank you for your prompt response.

(callout in margin) PLEASE VOTE! YOUR VOTE IS EXTREMELY IMPORTANT, NO MATTER HOW
MANY SHARES YOU OWN.

Sincerely,

John F. Cogan, Jr.
Chairman and President

0797-4213
<PAGE>
PIONEER INTEREST SHARES
60 State Street
Boston, MA 02109-1820

URGENT
PLEASE VOTE YOUR SHARES
TODAY
Dear Shareowner,

Not long ago we sent you a proxy card and materials explaining the proposals up
for a vote at the September 16, 1997 shareowner meeting for Pioneer Interest
Shares. PLEASE CAST YOUR VOTE TODAY!

If you have not already completed and returned the proxy card included in our
earlier package, PLEASE TAKE A MOMENT NOW TO COMPLETE THE ENCLOSED PROXY CARD
AND MAIL IT TO US IN THE POSTAGE-PAID ENVELOPE PROVIDED.

The proposals up for approval have been reviewed by Pioneer Interest Shares'
Board of Trustees, whose primary role is to protect your interests as a
shareowner. In the Trustees' opinion, the proposals are fair and reasonable. The
Trustees recommend that you vote FOR each proposal. For your easy reference, on
the back of this page is a summary of what a FOR vote would mean for each
proposal.

PLEASE VOTE! YOUR VOTE IS EXTREMELY IMPORTANT, NO MATTER HOW MANY SHARES YOU
OWN.

Thank you for your prompt response.

Sincerely,

John F. Cogan, Jr.
Chairman and President

[back side of page]
HERE IS WHAT A FOR VOTE MEANS FOR EACH OF THE PROPOSALS BEING CONSIDERED.
PROPOSAL 1:
ELECT NINE TRUSTEES TO THE BOARD. The Trustees supervise the Fund's activities
and review contractual arrangements with companies that provide services to the
Fund. Eight of the nominees previously were elected by shareowners. The ninth,
Mary K. Bush, was elected by the other Trustees; the proxy statement includes
detailed information about all nominees.

PROPOSAL 2:
RATIFY THE SELECTION OF ARTHUR ANDERSEN LLP AS THE FUND'S INDEPENDENT PUBLIC
ACCOUNTANTS FOR THE FISCAL YEAR ENDING DECEMBER 31, 1997.

PLEASE VOTE! YOUR VOTE IS EXTREMELY IMPORTANT, NO MATTER HOW MANY SHARES YOU
OWN.

0797-4214