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<PAGE> PAGE 2
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<PAGE> PAGE 3
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<PAGE> PAGE 4
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<PAGE> PAGE 6
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SIGNATURE KIMBERLEY MONASTERIO
TITLE ASST. TREASURER
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE FRANKLIN
NEW YORK TAX-FREE INCOME FUND MAY 31, 1996 ANNUAL REPORT AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<NAME> FRANKLIN NEW YORK TAX-FREE INCOME FUND - CLASS I
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> MAY-31-1996
<PERIOD-END> MAY-31-1996
<INVESTMENTS-AT-COST> 4,521,611,175
<INVESTMENTS-AT-VALUE> 4,669,164,806
<RECEIVABLES> 93,902,699
<ASSETS-OTHER> 222,013
<OTHER-ITEMS-ASSETS> 0
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<PAYABLE-FOR-SECURITIES> 9,133,709
<SENIOR-LONG-TERM-DEBT> 0
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<TOTAL-LIABILITIES> 14,759,730
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 4,589,094,838
<SHARES-COMMON-STOCK> 410,969,338
<SHARES-COMMON-PRIOR> 402,295,032
<ACCUMULATED-NII-CURRENT> 2,622,929
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 9,258,390
<OVERDISTRIBUTION-GAINS> 0
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<NET-ASSETS> 4,748,529,788
<DIVIDEND-INCOME> 0
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<OTHER-INCOME> 0
<EXPENSES-NET> 27,757,776
<NET-INVESTMENT-INCOME> 286,566,316
<REALIZED-GAINS-CURRENT> 16,081,912
<APPREC-INCREASE-CURRENT> (129,808,598)
<NET-CHANGE-FROM-OPS> 172,839,630
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (289,772,039)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
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<NUMBER-OF-SHARES-REDEEMED> (43,189,318)
<SHARES-REINVESTED> 11,218,379
<NET-CHANGE-IN-ASSETS> 21,561,108
<ACCUMULATED-NII-PRIOR> 6,864,571
<ACCUMULATED-GAINS-PRIOR> (6,823,522)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
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<PER-SHARE-NII> .700
<PER-SHARE-GAIN-APPREC> (.279)
<PER-SHARE-DIVIDEND> (.711)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 11.460
<EXPENSE-RATIO> .580
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE FRANKLIN
NEW YORK TAX-FREE INCOME FUND MAY 31, 1996 ANNUAL REPORT AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<NAME> FRANKLIN NEW YORK TAX-FREE INCOME FUND - CLASS II
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> MAY-31-1996
<PERIOD-END> MAY-31-1996
<INVESTMENTS-AT-COST> 4,521,611,175
<INVESTMENTS-AT-VALUE> 4,669,164,806
<RECEIVABLES> 93,902,699
<ASSETS-OTHER> 222,013
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 4,763,289,518
<PAYABLE-FOR-SECURITIES> 9,133,709
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 5,626,021
<TOTAL-LIABILITIES> 14,759,730
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 4,589,094,838
<SHARES-COMMON-STOCK> 3,409,918
<SHARES-COMMON-PRIOR> 163,023
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<OVERDISTRIBUTION-GAINS> 0
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<DIVIDEND-INCOME> 0
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<OTHER-INCOME> 0
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<NET-INVESTMENT-INCOME> 286,566,316
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<APPREC-INCREASE-CURRENT> (129,808,598)
<NET-CHANGE-FROM-OPS> 172,839,630
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (1,035,919)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 3,404,484
<NUMBER-OF-SHARES-REDEEMED> (209,017)
<SHARES-REINVESTED> 51,428
<NET-CHANGE-IN-ASSETS> 21,561,108
<ACCUMULATED-NII-PRIOR> 6,864,571
<ACCUMULATED-GAINS-PRIOR> (6,823,522)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 21,810,902
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 27,757,776
<AVERAGE-NET-ASSETS> 4,785,942,012
<PER-SHARE-NAV-BEGIN> 11.730
<PER-SHARE-NII> .650
<PER-SHARE-GAIN-APPREC> (.286)
<PER-SHARE-DIVIDEND> (.644)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
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</TABLE>
REPORT OF INDEPENDENT AUDITORS
To the Shareholders and Board of Trustees
of Franklin New York Tax-Free Income Fund:
In planning and performing our audit of the financial statements
and financial highlights of the funds comprising the Franklin
New YorkTax-Free Income Fund for the year ended May 31, 1996,
we considered its internal control structure, including procedures for
safeguarding securities, in order to determine our auditing
procedures for the purpose of expressing our opinion on the
financial statements and financial highlights and to comply with
the requirements of Form N-SAR, not to provide assurance on the
internal control structure.
The management of the Franklin New York Tax-Free Income Fund is
responsible for establishing and maintaining an internal control structure.
In fulfilling this responsibility, estimates and judgments by
management are required to assess the expected benefits and related
costs of internal control structure policies and procedures. Two
of the objectives of an internal control structure are to provide
management with reasonable, but not absolute, assurance that assets
are safeguarded against loss from unauthorized use or disposition
and that transactions are executed in accordance with management's
authorization and recorded properly to permit preparation of
financial statements in conformity with generally accepted
accounting principles.
Because of inherent limitations in any internal control structure,
errors or irregularities may occur and not be detected. Also,
projection of any evaluation of the structure to future periods
is subject to the risk that it may become inadequate because of
changes in conditions or that the effectiveness of the design and
operation may deteriorate.
Our consideration of the internal control structure would not
necessarily disclose all matters in the internal control structure
that might be material weaknesses under standards established by
the American Institute of Certified Public Accountants. A material
weakness is a condition in which the design or operation of the
specific internal control structure elements does not reduce to a
relatively low level the risk that errors or irregularities in
amounts that would be material in relation to the financial
statements and financial highlights being audited may occur and
not be detected within a timely period by employees in the normal
course of performing their assigned functions. However, we noted
no matters involving the internal control structure, including
procedures for safeguarding securities, that we consider to be
material weaknesses, as defined above, as of May 31, 1996.
This report is intended solely for the information and use of management
of the Franklin Investors Securities Trust and the Securities and Exchange
Commission.
S\Coopers & Lybrand L.L.P.
San Francisco, California
July 19, 1996
