PUTNAM AMERICAN GOVERNMENT INCOME FUND
497, 1996-04-10
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                  PUTNAM AMERICAN GOVERNMENT INCOME FUND

                 Prospectus supplement dated April 8, 1996
                   to Prospectus dated February 1, 1996

The second sentence in the first paragraph under the heading
"Limiting investment risk" on page 13 of the prospectus is replaced
with the following:

These restrictions prohibit the fund from acquiring more than 10%
of the voting securities of any one issuer.*


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