DREYFUS PREMIER MUNICIPAL BOND FUND
485BPOS, 1998-08-27
Previous: BT INVESTMENT FUNDS, 497, 1998-08-27
Next: SYNCRONYS SOFTCORP, 8-K, 1998-08-27



                                                  File Nos. 33-7496
                                                          811-4764
                     SECURITIES AND EXCHANGE COMMISSION
                           Washington, D.C. 20549

                                 FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933               [X]

     Pre-Effective Amendment No.                                      [  ]

   
     Post-Effective Amendment No. 19                                  [X]
    

                                   and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940       [X]

   
     Amendment No. 19                                                 [X]
    

                     (Check appropriate box or boxes.)

   
                    DREYFUS PREMIER MUNICIPAL BOND FUND
    
             (Exact Name of Registrant as Specified in Charter)

          c/o The Dreyfus Corporation
          200 Park Avenue, New York, New York          10166
          (Address of Principal Executive Offices)     (Zip Code)

     Registrant's Telephone Number, including Area Code: (212) 922-6000

                            Mark N. Jacobs, Esq.
                              200 Park Avenue
                          New York, New York 10166
                  (Name and Address of Agent for Service)

It is proposed that this filing will become effective (check appropriate
box)

     ____ immediately upon filing pursuant to paragraph (b)

   
      X   on September 1, 1998 pursuant to paragraph (b)
    

          60 days after filing pursuant to paragraph (a)(i)

          on     (date)      pursuant to paragraph (a)(i)

          75 days after filing pursuant to paragraph (a)(ii)

          on     (date)      pursuant to paragraph (a)(ii) 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.
     ----

                    DREYFUS PREMIER MUNICIPAL BOND FUND
               Cross-Reference Sheet Pursuant to Rule 495(a)

Items in
Part A of
Form N-1A     Caption                                       Page
_________     _______                                       ____

  1           Cover Page                                   Cover
  2           Synopsis                                       3
  3           Condensed Financial Information                4
   
  4           General Description of Registrant              6, 20
  5           Management of the Fund                         8
  5(a)        Management's Discussion of Fund's Performance  *
  6           Capital Stock and Other Securities             20
  7           Purchase of Securities Being Offered           9
  8           Redemption or Repurchase                       14
  9           Pending Legal Proceedings                      *
    

Items in
Part B of
Form N-1A
- ---------

  10          Cover Page                                     Cover
  11          Table of Contents                              Cover
  12          General Information and History                B-30
  13          Investment Objectives and Policies             B-2
  14          Management of the Fund                         B-11
  15          Control Persons and Principal                  B-15
              Holders of Securities
  16          Investment Advisory and Other                  B-16
              Services

_____________________________________

NOTE:  * Omitted since answer is negative or inapplicable.

                    DREYFUS PREMIER MUNICIPAL BOND FUND
         Cross-Reference Sheet Pursuant to Rule 495(a) (continued)

Items in
Part B of
Form N-1A     Caption                                        Page
_________     _______                                        _____

  17          Brokerage Allocation                           B-27
  18          Capital Stock and Other Securities             B-30
  19          Purchase, Redemption and Pricing               B-17, B-21,
              of Securities Being Offered                    B-25
  20          Tax Status                                     B-25
  21          Underwriters                                   Cover, B-17
  22          Calculations of Performance Data               B-28
   
  23          Financial Statements                           B-31
    

Items in
Part C of
Form N-1A
_________

  24          Financial Statements and Exhibits              C-1
  25          Persons Controlled by or Under                 C-3
              Common Control with Registrant
  26          Number of Holders of Securities                C-3
  27          Indemnification                                C-3
  28          Business and Other Connections of              C-4
              Investment Adviser
   
  29          Principal Underwriters                         C-11
  30          Location of Accounts and Records               C-14
  31          Management Services                            C-14
  32          Undertakings                                   C-14
    

_______________________________________________________________________________
   
PROSPECTUS                                                   SEPTEMBER 1, 1998
    
                    DREYFUS PREMIER MUNICIPAL BOND FUND
_______________________________________________________________________________
        Dreyfus Premier Municipal Bond Fund (the "Fund") is an open-end,
diversified, management investment company, known as a mutual fund. The
Fund's investment objective is to maximize current income exempt from Federal
income tax to the extent consistent with the preservation of capital.
        By this Prospectus, the Fund is offering three Classes of
shares_Class A, Class B and Class C_which are described herein. See
"Alternative Purchase Methods."
        The Fund provides free redemption checks with respect to Class A,
which you can use in amounts of $500 or more for cash or to pay bills. You
continue to earn income on the amount of the check until it clears. You can
purchase or redeem all Classes of shares by telephone using the TeleTransfer
Privilege.
        The Dreyfus Corporation professionally manages the Fund's portfolio.
        This Prospectus sets forth concisely information about the Fund that
you should know before investing. It should be read and retained for future
reference.
   
        The Statement of Additional Information, dated September 1, 1998,
which may be revised from time to time, provides a further discussion of
certain areas in this Prospectus and other matters which may be of interest
to some investors. It has been filed with the Securities and Exchange
Commission and is incorporated herein by reference. The Securities and
Exchange Commission maintains a Web site (http://www.sec.gov) that contains
the Statement of Additional Information, material incorporated by reference,
and other information regarding the Fund. For a free copy of the Statement of
Additional Information, write to the Fund at 144 Glenn Curtiss Boulevard,
Uniondale, New York 11556-0144, or call 1-800-554-4611. When telephoning, ask
for Operator 144.
    
   
        Mutual fund shares are not deposits or obligations of, or guaranteed
or endorsed by, any bank, and are not federally insured by the Federal
Deposit Insurance Corporation, the Federal Reserve Board, or any other
agency. Mutual fund shares involve certain investment risks, including the
possible loss of principal. The net asset value of funds of this type will
fluctuate.
    
_______________________________________________________________________________
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.
_______________________________________________________________________________
<TABLE>
<CAPTION>
   

<S>                                                             Table of Contents                            <C>
                                                                                                             Page
                                Fee Table.......................................................               3
                                Condensed Financial Information.................................               4
                                Alternative Purchase Methods....................................               5
                                Description of the Fund.........................................               6
                                Management of the Fund..........................................               8
                                How to Buy Shares...............................................               9
                                Shareholder Services............................................              11
                                How to Redeem Shares............................................              14
                                Distribution Plan and Shareholder Services Plan.................              17
                                Dividends, Distributions and Taxes..............................              18
                                Performance Information.........................................              19
                                General Information.............................................              20
                                Appendix........................................................              21
</TABLE>
    
   
<TABLE>
<CAPTION>

    
   

                [Page 2]
                                                                     Fee Table
<S>                                                                                      CLASS A       CLASS B          CLASS C
Shareholder Transaction Expenses
    Maximum Sales Load Imposed on Purchases                                              <C>           <C>              <C>
    (as a percentage of offering price).........................................         4.50%        .None            .None
    Maximum Deferred Sales Charge Imposed on Redemptions
    (as a percentage of the amount subject to charge)...........................         .None*        4.00%            1.00%
Annual Fund Operating Expenses
    (as a percentage of average daily net assets)
    Management Fees.............................................................          .55%          .55%             .55%
    12b-1 Fees..................................................................         .None          .50%             .75%
    Other Expenses..............................................................          .36%          .37%             .39%
    Total Fund Operating Expenses...............................................          .91%         1.42%            1.69%
Example
    You would pay the following
    expenses on a $1,000 investment,
    assuming (1) 5% annual return and
    (2) except where noted, redemption
    at the end of each time period:                                                      CLASS A      CLASS B           CLASSC
  1 Year........................................................................         $  54       $54/14**          $27/17**
  3 Years.......................................................................         $  73       $75/45**          $  53
  5 Years.......................................................................         $  93       $98/78**          $  92
10 Years........................................................................         $152        $144***           $200
____________________
*  A contingent deferred sales charge of 1% may be assessed on certain
redemptions of Class A shares purchased
without an initial sales charge as part of an investment of $1 million or
more.
**  Assuming no redemption of shares.
*** Ten year figure assumes conversion of Class B shares to Class A shares at
the end of the sixth year following the date of purchase.
</TABLE>
    
_______________________________________________________________________________
        The amounts listed in the example should not be considered as
representative of past or future expenses and actual expenses may be greater
or less than those indicated. Moreover, while the example assumes a 5% annual
return, the Fund's actual performance will vary and may result in an actual
return greater or less than 5%.
_______________________________________________________________________________
   
          The purpose of the foregoing table is to assist you in
understanding the costs and expenses borne by the Fund and investors, the
payment of which will reduce investors' annual return. Long-term investors in
Class B or Class C shares could pay more in 12b-1 fees than the economic
equivalent of paying a front-end sales charge. Certain Service Agents (as
defined below) may charge their clients direct fees for effecting
transactions in Fund shares; such fees are not reflected in the foregoing
table. See "Management of the Fund," "How to Buy Shares," "How to Redeem
Shares" and "Distribution Plan and Shareholder Services Plan."
    


                [Page 3]
                      Condensed Financial Information
   

          The information in the following table has been audited by Ernst &
Young LLP, the Fund's independent auditors. Further financial data, related
notes and report of independent auditors are incorporated by reference in the
Statement of Additional Information, available upon request.
    
                                   Financial Highlights
          Contained below is per share operating performance data for a share
of beneficial interest outstanding, total investment return, ratios to
average net assets and other supplemental data for each year indicated. This
information has been derived from the Fund's financial statements.
<TABLE>
<CAPTION>
   

                                                                          Class A Shares
                                ________________________________________________________-______________________________________
                                                                        ear Ended April 30,
                                ________________________________________________________-______________________________________
<S>                              <C>       <C>      <C>       <C>      <C>        <C>       <C>       <C>       <C>       <C>
PER SHARE DATA:                  1989      1990     1991      1992      1993      1994      1995      1996      1997      1998
                                ______    ______   ______    ______    ______    ______    ______    ______    ______    ______
  Net asset value,
  beginning of year.......      $12.30    $12.97   $12.77    $13.28    $13.75    $14.45    $13.81    $13.86    $13.85    $14.11
                                ______    ______   ______    ______    ______    ______    ______    ______    ______    ______
    Investment Operations:
  Investment income-net.....      1.01       .99      .98       .94       .92       .89       .84       .86       .82       .79
  Net realized and unrealized gain
  (loss) on investments....        .67      (.20)     .51       .49       .91      (.59)      .05      (.01)      .27       .66
                                ______    ______   ______    ______    ______    ______    ______    ______    ______    ______
  Total from Investment
   Operations.....                1.68       .79     1.49      1.43      1.83       .30       .89       .85      1.09      1.45
                                ______    ______   ______    ______    ______    ______    ______    ______    ______    ______
    Distributions:
  Dividends from investment
   income-net.......             (1.01)     (.99)    (.98)     (.94)     (.92)     (.89)     (.84)     (.86)     (.82)     (.79)
  Dividends from net realized
  gain on investments.......       ._        ._       ._       (.02)     (.21)     (.05)      ._        ._       (.01)     (.08)
                                ______    ______   ______    ______    ______    ______    ______    ______    ______    ______
  Total Distributions.....       (1.01)     (.99)    (.98)     (.96)    (1.13)     (.94)     (.84)     (.86)     (.83)     (.87)
                                ______    ______   ______    ______    ______    ______    ______    ______    ______    ______
  Net asset value,
   end of year.......           $12.97    $12.77   $13.28    $13.75    $14.45    $13.81    $13.86    $13.85    $14.11    $14.69
                                ======    ======   ======    ======    ======    ======    ======    ======    ======    ======
TOTAL INVESTMENT RETURN*....     14.13%     6.25%   12.13%    11.08%    13.76%     1.84%     6.72%     6.08%     8.03%    10.52%
RATIOS/SUPPLEMENTAL DATA:
  Ratio of expenses to
   average net assets....          ._        ._       .22%      .54%      .74%      .85%      .92%      .92%      .91%      .91%
  Ratio of net investment income to
  average net assets.......       7.72%     7.51%    7.43%     6.90%     6.43%     6.01%     6.16%     5.98%     5.84%     5.42%
  Decrease reflected in above expense ratios due to
  undertakings by The Dreyfus Corporation (limited
  to the expense limitation provision of the
  Management Agreement)......     1.50%     1.15%     .82%      .40%      .20%      .06%      ._        ._        ._        ._
  Portfolio Turnover Rate.....  143.20%    63.53%   41.30%    50.72%    30.99%    22.15%    38.60%    36.59%    28.17%    26.33%
  Net Assets, end of year
   (000's omitted)....         $26,342  $100,784 $247,195  $388,793  $526,606  $546,036  $495,616  $474,044  $457,327  $447,869
__________________
*Exclusive of sales load.
                                                           Class B Shares                                  Class C Shares
                                           _____________________________________________________     _________________________-
                                                         Year Ended April 30,                             Year Ended April 30,
                                           ______________________________________________________    __________________________
                                          1993(1)   1994      1995      1996      1997      1998     1996(2)    1997      1998
                                          ______   ______    ______    ______    ______    ______    ______    ______    ______
PER SHARE DATA:
    Net asset value, beginning
    of year.......                        $14.02   $14.45    $13.81    $13.86    $13.85    $14.11    $14.28    $13.87    $14.12
                                          ______   ______    ______    ______    ______    ______    ______    ______    ______
    INVESTMENT OPERATIONS:
    Investment income-net.......             .24      .80       .77       .78       .75       .72       .60       .72       .68
    Net realized and unrealized
    gain (loss) on investments..             .43     (.59)      .05      (.01)      .27       .66      (.41)      .26       .67
                                          ______   ______    ______    ______    ______    ______    ______    ______    ______
    Total from Investment Operations...      .67      .21       .82       .77      1.02      1.38       .19       .98      1.35
                                          ______   ______    ______    ______    ______    ______    ______    ______    ______
    DISTRIBUTIONS:
    Dividends from investment
     income-net.......                      (.24)    (.80)     (.77)     (.78)     (.75)     (.72)     (.60)     (.72)     (.68)
    Dividends from net realized
     gain on investments....                 ._      (.05)      ._        ._       (.01)     (.08)      ._       (.01)     (.08)
                                          ______   ______    ______    ______    ______    ______    ______    ______    ______
    Total Distributions.........            (.24)    (.85)     (.77)     (.78)     (.76)     (.80)     (.60)     (.73)     (.76)
                                          ______   ______    ______    ______    ______    ______    ______    ______    ______
    Net asset value, end of year...       $14.45   $13.81    $13.86    $13.85    $14.11    $14.69    $13.87    $14.12    $14.71
                                          ======   ======    ======    ======    ======    ======    ======    ======    ======
TOTAL INVESTMENT RETURN(3)......           16.80%(4) 1.26%     6.15%     5.53%     7.49%     9.95%     1.56%(4)  7.16%     9.73%
RATIOS/SUPPLEMENTAL DATA:
    Ratio of expenses to average
    net assets..................            1.15%(4) 1.40%     1.44%     1.43%     1.43%     1.42%     1.77%(4)  1.64%     1.69%
    Ratio of net investment income
    to average net assets.......            5.13%(4) 5.33%     5.62%     5.46%     5.33%     4.89%     4.84%(4)  5.01%     4.55%
    Decrease reflected in above expense
    ratios due to undertakings by
    The Dreyfus Corporation.....             .10%(4)  .05%      ._        ._        ._        ._        ._        ._        ._
    Portfolio Turnover Rate.....           30.99%   22.15%    38.60%    36.59%    28.17%    26.33%    36.59%    28.17%    26.33%
    Net Assets, end of year
    (000's omitted).............         $19,855  $95,643   $99,411  $106,931  $109,485  $119,457      $340    $1,049    $3,019
______________________________
(1) From January 15, 1993 (commencement of initial offering)to April 30, 1993.
(2) From July 13, 1995 (commencement of initial offering) to April 30, 1996.
(3 )Exclusive of sales load.
(4) Annualized.
          Further information about the Fund's performance is contained in
the Fund's annual report, which may be obtained without charge by writing to
the address or calling the number set forth on the cover page of this
Prospectus.


                [Page 4]
                                                              Debt Outstanding
                                                                                                    YEAR ENDED APRIL 30, 1998(1)
                                                                                                    _____________________________
  Amount of debt outstanding at end of year (in thousands)..............................                           $0
  Average amount of debt outstanding throughout year (in thousands)(2)..................                           $18
  Average number of shares outstanding throughout year (in thousands)(3)................                           39,106
  Average amount of debt per share throughout year......................................                           $0(4)

(1)  There was no debt outstanding for the prior nine years.
(2)  Based upon daily outstanding borrowings.
(3)  Based upon month-end balances.
(4)  Amount represents less than $.01 per share.
</TABLE>

    
   


                     Alternative Purchase Methods
          The Fund offers you three methods of purchasing Fund shares. You
may choose the Class of shares that best suits your needs, given the amount
of your purchase, the length of time you expect to hold your shares and any
other relevant circumstances. Each Fund share represents an identical pro
rata interest in the Fund's investment portfolio.
          Class A shares are sold at net asset value per share plus a maximum
initial sales charge of 4.50% of the public offering price imposed at the
time of purchase. The initial sales charge may be reduced or waived for
certain purchases. See "How to Buy Shares _ Class A Shares." These shares are
subject to an annual service fee at the rate of .25 of 1% of the value of the
average daily net assets of Class A. See "Distribution Plan and Shareholder
Services Plan _ Shareholder Services Plan."
          Class B shares are sold at net asset value per share with no
initial sales charge at the time of purchase; as a result, the entire
purchase price is immediately invested in the Fund. Class B shares are
subject to a maximum 4% contingent deferred sales charge ("CDSC"), which is
assessed if you redeem Class B shares within six years of purchase. See "How
to Buy Shares _ Class B Shares" and "How to Redeem Shares _ Contingent
Deferred Sales Charge_Class B Shares." These shares also are subject to an
annual service fee at the rate of .25 of 1% of the value of the average daily
net assets of Class B. In addition, Class B shares are subject to an annual
distribution fee at the rate of .50 of 1% of the value of the average daily
net assets of Class B. See "Distribution Plan and Shareholder Services Plan."
The distribution fee paid by Class B will cause such Class to have a higher
expense ratio and to pay lower dividends than Class A. Approximately six
years after the date of purchase, Class B shares automatically will convert
to Class A shares, based on the relative net asset values for shares of each
such Class, and will no longer be subject to the distribution fee. Class B
shares that have been acquired through the reinvestment of dividends and
distributions will be converted on a pro rata basis together with other Class
B shares, in the proportion that a shareholder's Class B shares converting to
Class A shares bears to the total Class B shares not acquired through the
reinvestment of dividends and distributions.
          Class C shares are sold at net asset value per share with no
initial sales charge at the time of purchase; as a result, the entire
purchase price is immediately invested in the Fund. Class C shares are
subject to a 1% CDSC, which is assessed only if you redeem Class C shares
within one year of their purchase. See "How to Buy Shares _ Class C Shares"
and "How to Redeem Shares _ Contingent Deferred Sales Charge _ Class C
Shares." These shares also are subject to an annual service fee at the rate
of .25 of 1%, and an annual distribution fee at the rate of .75 of 1%, of the
value of the average daily net assets of Class C. See "Distribution Plan and
Shareholder Services Plan." The distribution fee paid by Class C will cause
such Class to have a higher expense ratio and to pay lower dividends than
Class A.
          The decision as to which Class of shares is more beneficial to you
depends on the amount and the intended length of your investment. You should
consider whether, during the anticipated life of your investment in the Fund,
the accumulated distribution fee and CDSC, if any, on Class B or Class C
shares would be less than the initial sales charge on Class A shares
purchased at the same time, and to what extent, if any, such differential
would be offset by the return of Class A. Additionally, investors qualifying
for reduced initial sales charges who expect to maintain their investment for
an extended period of time might consider purchasing Class A shares because
the accumulated continuing distribution fees on Class B or Class C shares may
exceed the initial sales charge on Class A shares during the life of the
investment. Finally, you should consider the effect of the CDSC period and
any conversion rights of the Classes in the context of your own investment
time frame. For example, while Class C shares have a shorter CDSC period than
Class B shares, Class C shares do not have a conversion feature and,
therefore, are subject to an ongoing distribution fee. Thus, Class A and
Class B shares may be more attractive than Class C shares to investors with
long term investment outlooks. Generally, Class A shares may be more
appropriate for investors who invest $1,000,000 or more in Fund shares, and
for investors who invest between $100,000 and $999,999 in Fund shares with
long term investment outlooks. Class A shares will not be appropriate for
investors who invest less than $50,000 in Fund shares.

                [Page 5]
                            Description of the Fund
Investment Objective

    
   
          The Fund's investment objective is to maximize current income
exempt from Federal income tax to the extent consistent with the preservation
of capital. To accomplish its investment objective, the Fund invests
primarily in Municipal Obligations (described below) rated at least Baa by
Moody's Investors Service, Inc. ("Moody's") or BBB by Standard & Poor's
Ratings Group ("S&P") or Fitch IBCA, Inc. ("Fitch"). The Fund's investment
objective cannot be changed without approval by the holders of a majority (as
defined in the Investment Company Act of 1940, as amended (the "1940 Act"))
of the Fund's outstanding voting shares. There can be no assurance that the
Fund's investment objective will be achieved.
Municipal Obligations
    

          Municipal Obligations are debt securities issued by states,
territories and possessions of the United States and the District of Columbia
and their political subdivisions, agencies and instrumentalities, or
multistate agencies or authorities, the interest from which is, in the
opinion of bond counsel to the issuer, exempt from Federal income tax.
Municipal Obligations generally include debt obligations issued to obtain
funds for various public purposes as well as certain industrial development
bonds issued by or on behalf of public authorities. Municipal Obligations are
classified as general obligation bonds, revenue bonds and notes. General
obligation bonds are secured by the issuer's pledge of its faith, credit and
taxing power for the payment of principal and interest. Revenue bonds are
payable from the revenue derived from a particular facility or class of
facilities or, in some cases, from the proceeds of a special excise or other
specific revenue source, but not from the general taxing power. Tax exempt
industrial development bonds, in most cases, are revenue bonds that do not
carry the pledge of the credit of the issuing municipality, but generally are
guaranteed by the corporate entity on whose behalf they are issued. Notes are
short-term instruments which are obligations of the issuing municipalities or
agencies and are sold in anticipation of a bond sale, collection of taxes or
receipt of other revenues. Municipal Obligations include municipal
lease/purchase agreements which are similar to installment purchase contracts
for property or equipment issued by municipalities. Municipal Obligations
bear fixed, floating or variable rates of interest, which are determined in
some instances by formulas under which the Municipal Obligation's interest
rate will change directly or inversely to changes in interest rates or an
index, or multiples thereof, in many cases subject to a maximum and minimum.
Certain Municipal Obligations are subject to redemption at a date earlier
than their stated maturity pursuant to call options, which may be separated
from the related Municipal Obligation and purchased and sold separately.
Management Policies
          It is a fundamental policy of the Fund that it will invest at least
80% of the value of its net assets (except when maintaining a temporary
defensive position) in Municipal Obligations. Generally, at least 65% of the
value of the Fund's net assets (except when maintaining a temporary defensive
position) will be invested in bonds, debentures and other debt instruments.
          At least 70% of the value of the Fund's net assets must consist of
Municipal Obligations which, in the case of bonds, are rated no lower than
Baa by Moody's or BBB by S&P or Fitch. The Fund may invest up to 30% of the
value of its net assets in Municipal Obligations which, in the case of bonds,
are rated lower than Baa by Moody's and BBB by S&P and Fitch and as low as
the lowest rating assigned by Moody's, S&P or Fitch. The Fund may invest in
short-term Municipal Obligations which are rated in the two highest rating
categories by Moody's, S&P or Fitch. See "Appendix" in the Statement of
Additional Information. Municipal Obligations rated Baa by Moody's or BBB by
S&P or Fitch are considered investment grade obligations; those rated Baa by
Moody's are considered medium grade obligations which lack outstanding
investment characteristics and have speculative characteristics, while those
rated BBB by S&P and Fitch are regarded as having an adequate capacity to pay
principal and interest. Investments rated Ba or lower by Moody's and BB or
lower by S&P and Fitch ordinarily provide higher yields but involve greater
risk because of their speculative characteristics. The Fund may invest in
Municipal Obligations rated C by Moody's or D by S&P or Fitch, which is the
lowest rating assigned by such rating organizations and indicates that the
Municipal Obligation is in default and interest and/or repayment of principal
is in arrears. See "Investment Considerations and Risks _ Lower Rated Bonds"
below for a further discussion of certain risks. The Fund also may invest in
securities which, while not rated, are determined by The Dreyfus Corporation
to be of comparable quality to the rated securities in which the Fund may
invest; for purposes of the 70% requirement described in this paragraph, such
unrated securities shall be deemed to have the rating so determined. The Fund
also may invest in Taxable Investments of the quality described under
"Appendix_Certain Portfolio Securities_Taxable Investments." Under normal
market conditions, the weighted average maturity of the Fund's portfolio is
expected to exceed ten years.
          From time to time, the Fund may invest more than 25% of the value
of its total assets in industrial development bonds which, although issued by
industrial development authorities, may be backed only by the assets and
revenues
                [Page 6]
of the non-governmental users. Interest on Municipal Obligations
(including certain industrial development bonds) which are specified private
activity bonds as defined in the Internal Revenue Code of 1986, as amended
(the "Code"), issued after August 7, 1986, while exempt from Federal income
tax, is a preference item for the purpose of the alternative minimum tax.
Where a regulated investment company receives such interest, a proportionate
share of any exempt-interest dividend paid by the investment company may be
treated as such a preference item to shareholders. The Fund may invest
without limitation in such Municipal Obligations if The Dreyfus Corporation
determines that their purchase is consistent with the Fund's investment
objective.

   
          The Fund's annual portfolio turnover rate for the current fiscal
year is not expected to exceed 100%. A turnover rate of 100% is equivalent to
the Fund buying and selling all of the securities in its portfolio once in
the course of a year. The Fund may engage in various investment techniques,
such as options and futures transactions, lending portfolio securities and
short-selling. Use of certain of these techniques may give rise to taxable
income. See "Dividends, Distributions and Taxes." For a discussion of the
investment techniques and their related risks, see "Investment Considerations
and Risks" and "Appendix_Investment Techniques" below and "Investment
Objective and Management Policies_Management Policies" in the Statement of
Additional Information.
    

Investment Considerations and Risks
General _ Even though interest-bearing securities are investments which
promise a stable stream of income, the prices of such securities are
inversely affected by changes in interest rates and, therefore, are subject
to the risk of market price fluctuations. Certain securities that may be
purchased by the Fund, such as those with interest rates that fluctuate
directly or indirectly based upon multiples of a stated index, are designed
to be highly sensitive to changes in interest rates and can subject the
holders thereof to extreme reductions of yield and possibly loss of principal.
The values of fixed-income securities also may be affected by changes in the
credit rating or financial condition of the issuing entities. Once the rating
of a portfolio security has been changed, the Fund will consider all
circumstances deemed relevant in determining whether to hold the security.
The Fund's net asset value generally will not be stable and should fluctuate
based upon changes in the value of the Fund's portfolio securities.
Securities in which the Fund invests may earn a higher level of current
income than certain shorter-term or higher quality securities which generally
have greater liquidity, less market risk and less fluctuation in market
value.
Investing in Municipal Obligations _ The Fund may invest more than 25% of
the value of its total assets in Municipal Obligations which are related in
such a way that an economic, business or political development or change
affecting one such security also would affect the other securities; for
example, securities the interest upon which is paid from revenues of similar
types of projects, or securities whose issuers are located in the same state.
As a result, the Fund may be subject to greater risk as compared to a fund
that does not follow this practice.
          Certain municipal lease/purchase obligations in which the Fund may
invest may contain "non-appropriation" clauses which provide that the
municipality has no obligation to make lease payments in future years unless
money is appropriated for such purpose on a yearly basis. Although
"non-appropriation" lease/purchase obligations are secured by the leased
property, disposition of the leased property in the event of foreclosure
might prove difficult. In evaluating the credit quality of a municipal
lease/purchase obligation that is unrated, The Dreyfus Corporation will
consider, on an ongoing basis, a number of factors including the likelihood
that the issuing municipality will discontinue appropriating funding for the
leased property.
          Certain provisions in the Code relating to the issuance of
Municipal Obligations may reduce the volume of Municipal Obligations
qualifying for Federal tax exemption. One effect of these provisions could be
to increase the cost of the Municipal Obligations available for purchase by
the Fund and thus reduce available yield. Shareholders should consult their
tax advisers concerning the effect of these provisions on an investment in
the Fund. Proposals that may restrict or eliminate the income tax exemption
for interest on Municipal Obligations may be introduced in the future. If any
such proposal were enacted that would reduce the availability of Municipal
Obligations for investment by the Fund so as to adversely affect Fund
shareholders, the Fund would reevaluate its investment objective and policies
and submit possible changes in the Fund's structure to shareholders for their
consideration. If legislation were enacted that would treat a type of
Municipal Obligation as taxable, the Fund would treat such security as a
permissible Taxable Investment within the applicable limits set forth herein.
Zero Coupon Securities _ The Fund may invest in zero coupon securities and
pay-in-kind bonds (bonds which pay interest through the issuance of
additional bonds). Federal income tax law requires the holder of a zero
coupon security or of certain pay-in-kind bonds to accrue income with respect
to these securities prior to the receipt of cash payments. To maintain its
qualification as a regulated investment company and avoid liability for
Federal income taxes, the Fund may be required to distribute such income
accrued with respect to these securities and may have to dispose of portfolio
securities under disadvantageous circumstances in order to generate cash to
satisfy these distribution requirements.

   
Lower Rated Bonds _ The Fund may invest up to 30% of its net assets in higher
yielding (and, therefore, higher risk) debt securities, such as those rated
Ba by Moody's or BB by S&P or Fitch or as low as the lowest rating assigned
                [Page 7]
by Moody's, S&P or Fitch. They may be subject to certain risks with respect
to the issuing entity and to greater market fluctuations than certain lower
yielding, higher rated fixed-income securities. The retail secondary market
for these securities may be less liquid than that of higher rated securities;
adverse conditions could make it difficult at times for the Fund to sell
certain securities or could result in lower prices than those used in
calculating the Fund's net asset value. See "Appendix _ Certain Portfolio
Securities _ Ratings."
    
   
Use of Derivatives _ The Fund may invest in, or enter into, derivatives
("Derivatives"). These are financial instruments which derive their
performance, at least in part, from the performance of an underlying asset,
index or interest rate. The Derivatives the Fund may use include options and
futures. While Derivatives can be used effectively in furtherance of the
Fund's investment objective, under certain market conditions, they can
increase the volatility of the Fund's net asset value, decrease the liquidity
of the Fund's portfolio and make more difficult the accurate pricing of the
Fund's portfolio. See "Appendix_Investment Techniques_Use of Derivatives"
below and "Investment Objective and Management Policies_Management
Policies_Derivatives" in the Statement of Additional Information.
    

Simultaneous Investments _ Investment decisions for the Fund are made
independently from those of other investment companies advised by The Dreyfus
Corporation. If, however, such other investment companies desire to invest
in, or dispose of, the same securities as the Fund, available investments or
opportunities for sales will be allocated equitably to each investment
company. In some cases, this procedure may adversely affect the size of the
position obtained for or disposed of by the Fund or the price paid or
received by the Fund.
Year 2000 Risks _ Like other mutual funds, financial and business
organizations and individuals around the world, the Fund could be adversely
affected if the computer systems used by The Dreyfus Corporation and the
Fund's other service providers do not properly process and calculate
date-related information and data from and after January 1, 2000. This is
commonly known as the "Year 2000 Problem." The Dreyfus Corporation is taking
steps to address the Year 2000 Problem with respect to the computer systems
that it uses and to obtain assurances that comparable steps are being taken
by the Fund's other major service providers. At this time, however, there can
be no assurance that these steps will be sufficient to avoid any adverse
impact on the Fund.
                           Management of the Fund
   
Investment Adviser _ The Dreyfus Corporation, located at 200 Park Avenue, New
York, New York 10166, was formed in 1947 and serves as the Fund's investment
adviser. The Dreyfus Corporation is a wholly-owned subsidiary of Mellon Bank,
N.A., which is a wholly-owned subsidiary of Mellon Bank Corporation
("Mellon"). As of July 31, 1998, The Dreyfus Corporation managed or
administered approximately $110 billion in assets for approximately 1.7
million investor accounts nationwide.
    

          The Dreyfus Corporation supervises and assists in the overall
management of the Fund's affairs under a Management Agreement with the Fund,
subject to the authority of the Fund's Board in accordance with Massachusetts
law. The Fund's primary portfolio manager is Samuel J. Weinstock. He has held
that position since August 1987 and has been employed by The Dreyfus
Corporation since March 1987. The Fund's other portfolio managers are
identified in the Statement of Additional Information. The Dreyfus Corporation
also provides research services for the Fund and for other funds advised by
The Dreyfus Corporation through a professional staff of portfolio managers
and securities analysts.
             
          Mellon is a publicly owned multibank holding company incorporated
under Pennsylvania law in 1971 and registered under the Federal Bank Holding
Company Act of 1956, as amended. Mellon provides a comprehensive range of
financial products and services in domestic and selected international
markets. Mellon is among the twenty-five largest bank holding companies in
the United States based on total assets. Mellon's principal wholly-owned
subsidiaries are Mellon Bank, N.A., Mellon Bank (DE) National Association,
Mellon Bank (MD), The Boston Company, Inc., AFCOCredit Corporation and a
number of companies known as Mellon Financial Services Corporations. Through
its subsidiaries, including The Dreyfus Corporation, Mellon managed more than
$350 billion in assets as of June 30, 1998, including approximately $125
billion in mutual fund assets. As of June 30, 1998, Mellon, through various
subsidiaries, provided non-investment services, such as custodial or
administration services, for more than $1.791 trillion in assets including
approximately $54 billion in mutual fund assets.
    

          For the fiscal year ended April 30, 1998, the Fund paid The Dreyfus
Corporation a monthly management fee at the annual rate of .55 of 1% of the
value of the Fund's average daily net assets. From time to time, The Dreyfus
Corporation may waive receipt of its fees and/or voluntarily assume certain
expenses of the Fund, which would have the effect of lowering the expense
ratio of the Fund and increasing yield to investors. The Fund will not pay
The Dreyfus Corporation at a later time for any amounts it may waive, nor
will the Fund reimburse The Dreyfus Corporation for any amounts it may
assume.

   
          In allocating brokerage transactions, The Dreyfus Corporation seeks
to obtain the best execution of orders at the most favorable net price.
Subject to this determination, The Dreyfus Corporation may consider, among
other things, the receipt of research services and/or the sale of shares of
the Fund or other funds managed, advised or administered
                [Page 8]
by The Dreyfus Corporation or its affiliates as factors in
the selection of broker-dealers to execute portfolio transactions for the
Fund. See "Portfolio Transactions" in the Statement of Additional
Information.
    

          The Dreyfus Corporation may pay the Fund's distributor for
shareholder services from The Dreyfus Corporation's own assets, including
past profits but not including the management fee paid by the Fund. The
Fund's distributor may use part or all of such payments to pay Service Agents
in respect of these services.
Distributor _ The Fund's distributor is Premier Mutual Fund Services, Inc.
(the "Distributor"), located at 60 State Street, Boston, Massachusetts 02109.
The Distributor's ultimate parent is Boston Institutional Group, Inc.
Transfer and Dividend Disbursing Agent and Custodian _ Dreyfus Transfer,
Inc., a wholly-owned subsidiary of The Dreyfus Corporation, P.O. Box 9671,
Providence, Rhode Island 02940-9671, is the Fund's Transfer and Dividend
Disbursing Agent (the "Transfer Agent"). The Bank of New York, 90 Washington
Street, New York, New York 10286, is the Fund's Custodian.
                            How to Buy Shares
General _ Fund shares may be purchased only by clients of certain financial
institutions (which may include banks), securities dealers ("Selected
Dealers") and other industry professionals (collectively, "Service Agents"),
except that full-time or part-time employees of The Dreyfus Corporation or
any of its affiliates or subsidiaries, directors of The Dreyfus Corporation,
Board members of a fund advised by The Dreyfus Corporation, including members
of the Fund's Board, or the spouse or minor child of any of the foregoing may
purchase Class A shares directly through the Distributor. Subsequent
purchases may be sent directly to the Transfer Agent or your Service Agent.
   
          When purchasing Fund shares, you must specify which Class is being
purchased. Share certificates are issued only upon your written request. No
certificates are issued for fractional shares. It is not recommended that the
Fund be used as a vehicle for Keogh, IRA or other qualified retirement plans.
The Fund reserves the right to reject any purchase order. See "Appendix _
Additional Information About Purchases, Exchanges and Redemptions."
    

          Service Agents may receive different levels of compensation for
selling different Classes of shares. Management understands that some Service
Agents may impose certain conditions on their clients which are different
from those described in this Prospectus, and, to the extent permitted by
applicable regulatory authority, may charge their clients direct fees. You
should consult your Service Agent in this regard.
          The minimum initial investment is $1,000. Subsequent investments
must be at least $100. The initial investment must be accompanied by the
Account Application. The Fund reserves the right to vary the initial and
subsequent investment minimum requirements at any time.
          You may purchase Fund shares by check or wire, or through the
TeleTransfer Privilege described below. Checks should be made payable to "The
Dreyfus Family of Funds." Payments which are mailed should be sent to Dreyfus
Premier Municipal Bond Fund, P.O. Box 6587, Providence, Rhode Island
02940-6587. If you are opening a new account, please enclose your Account
Application indicating which Class of shares is being purchased. For
subsequent investments, your Fund account number should appear on the check
and an investment slip should be enclosed. Neither initial nor subsequent
investments should be made by third party check.

   
          Wire payments may be made if your bank account is in a commercial
bank that is a member of the Federal Reserve System or any other bank having
a correspondent bank in New York City. Immediately available funds may be
transmitted by wire to The Bank of New York DDA #8900119292/Dreyfus Premier
Municipal Bond Fund, for purchase of Fund shares in your name. The wire must
include your Fund account number (for new accounts, your Taxpayer
Identification Number ("TIN") should be included instead), account
registration and dealer number, if applicable, and must indicate the Class of
shares being purchased. If your initial purchase of Fund shares is by wire,
please call 1-800-554-4611 after completing your wire payment to obtain your
Fund account number. Please include your Fund account number on the Account
Application and promptly mail the Account Application to the Fund, as no
redemptions will be permitted until the Account Application is received. You
may obtain further information about remitting funds in this manner from your
bank. All payments should be made in U.S. dollars and, to avoid fees and
delays, should be drawn only on U.S. banks. A charge will be imposed if any
check used for investment in your account does not clear. The Fund makes
available to certain large institutions the ability to issue purchase
instructions through compatible computer facilities.
    

          Fund shares also may be purchased through Dreyfus-AUTOMATIC Asset
BuilderRegistration Mark and the Government Direct Deposit Privilege
described under "Shareholder Services." These services enable you to make
regularly scheduled investments and may provide you with a convenient way to
invest for long-term financial goals. You should be aware, however, that
periodic investment plans do not guarantee a profit and will not protect an
investor against loss in a declining market.
          Subsequent investments also may be made by electronic transfer of
funds from an account maintained in a bank or other domestic financial
institution that is an Automated Clearing House member. You must direct the
institution to transmit immediately available funds through the Automated
Clearing House to The Bank of New York with
                [Page 9]
instructions to credit your Fund account. The instructions must
specify your Fund account registration and your Fund account number preceded
by the digits "1111."
          Fund shares are sold on a continuous basis. Net asset value per
share of each Class is determined as of the close of trading on the floor of
the New York Stock Exchange (currently 4:00 p.m., New York time), on each day
the New York Stock Exchange is open for business. For purposes of determining
net asset value, options and futures contracts will be valued 15 minutes
after the close of trading on the floor of the New York Stock Exchange. Net
asset value per share of each Class is computed by dividing the value of the
Fund's net assets represented by such Class (i.e., the value of its assets
less liabilities) by the total number of shares of such Class outstanding.
The Fund's investments are valued by an independent pricing service approved
by the Fund's Board and are valued at fair value as determined by the pricing
service. The pricing service's procedures are reviewed under the general
supervision of the Fund's Board. For further information regarding the
methods employed in valuing Fund investments, see "Determination of Net Asset
Value" in the Statement of Additional Information.

   
          If an order is received in proper form by the Transfer Agent or
other entity authorized to receive orders on behalf of the Fund by the close
of trading on the floor of the New York Stock Exchange (currently 4:00 p.m.,
New York time) on any business day, Fund shares will be purchased at the
public offering price determined as of the close of trading on the floor of
the New York Stock Exchange on that day. Otherwise, Fund shares will be
purchased at the public offering price determined as of the close of trading
on the floor of the New York Stock Exchange, on the next business day, except
where shares are purchased through a dealer as provided below.
    

          Orders for the purchase of Fund shares received by dealers by the
close of trading on the floor of the New York Stock Exchange on a business
day and transmitted to the Distributor or its designee by the close of its
business day (normally 5:15 p.m., New York time) will be based on the public
offering price per share determined as of the close of trading on the floor
of the New York Stock Exchange on that day. Otherwise, the orders will be
based on the next determined public offering price. It is the dealers'
responsibility to transmit orders so that they will be received by the
Distributor or its designee before the close of its business day.
          Federal regulations require that you provide a certified TIN upon
opening or reopening an account. See "Dividends, Distributions and Taxes" and
the Account Application for further information concerning this requirement.
Failure to furnish a certified TIN to the Fund could subject you to a $50
penalty imposed by the Internal Revenue Service (the "IRS").
Class A Shares _ The public offering price for Class A shares is the net
asset value per share of that Class plus a sales load as shown below:
<TABLE>
<CAPTION>

                                                            Total Sales Load
                                                     __________________________
                                                      As a % of        As a % of       Dealers' Reallowance
                                                   offering price    net asset value       as a % of
        Amount of Transaction                          per share       per share       offering price
        _____________________-                        _________         _________        _________
        <S>                                              <C>              <C>                <C>
        Less than $50,000.........                       4.50             4.70               4.25
        $50,000 to less than $100,000                    4.00             4.20               3.75
        $100,000 to less than $250,000                   3.00             3.10               2.75
        $250,000 to less than $500,000                   2.50             2.60               2.25
        $500,000 to less than $1,000,000                 2.00             2.00               1.75
        $1,000,000 or more........                       -0-               -0-               -0-
</TABLE>
   
          A CDSC of 1% will be assessed at the time of redemption of Class A
shares purchased without an initial sales charge as part of an investment of
at least $1,000,000 and redeemed within one year of purchase. The Distributor
may pay Service Agents an amount up to 1% of the net asset value of Class A
shares purchased by their clients that are subject to a CDSC. The terms
contained in the section of the Prospectus entitled "How to Redeem
Shares_Contingent Deferred Sales Charge" (other than the amount of
the CDSC and time periods) are applicable to the Class A shares subject to a
CDSC. Letter of Intent and Right of Accumulation apply to purchases of Class
A shares subject to a CDSC.
    

          Full-time employees of NASD member firms and full-time employees of
other financial institutions which have entered into an agreement with the
Distributor pertaining to the sale of Fund shares (or which otherwise have a
brokerage related or clearing arrangement with an NASD member firm or
financial institution with respect to sales of Fund shares) may purchase
Class A shares for themselves directly or pursuant to an employee benefit
plan or other program, or for their spouses or minor children at net asset
value, provided that they have furnished the Distributor with such
information as it may request from time to time in order to verify
eligibility for this privilege. This privilege also applies to full-time
employees of financial institutions affiliated with NASD member firms whose
full-time employees are eligible to purchase Class A shares at net asset
value. In addition, Class A shares are offered at net asset value to
full-time or part-time employees of The Dreyfus Corporation or any of its
affiliates or subsidiaries, directors of The Dreyfus Corporation, Board
members of a fund advised by The Dreyfus Corporation, including members of
the Fund's Board, or the spouse or minor child of any of the foregoing.

                [Page 10]
          Class A shares may be purchased at net asset value through certain
broker-dealers and other financial institutions which have entered into an
agreement with the Distributor, which includes a requirement that such shares
be sold for the benefit of clients participating in a "wrap account" or a
similar program under which such clients pay a fee to such broker-dealer or
other financial institution.

   
          Class A shares also may be purchased at net asset value, subject to
appropriate documentation, through a broker-dealer or other financial
institution with the proceeds from the redemption of shares of a registered
open-end management investment company not managed by The Dreyfus Corporation
or its affiliates. The purchase of Class A shares of the Fund must be made
within 60 days of such redemption and the shareholder must have been subject
to an initial sales charge or a contingent deferred sales charge with respect
to such redeemed shares.
    

          Class A shares also may be purchased at net asset value, subject to
appropriate documentation, by (i)qualified separate accounts maintained by an
insurance company pursuant to the laws of any State or territory of the
United States, (ii) a State, county or city or instrumentality thereof, (iii)
a charitable organization (as defined in Section 501(c)(3) of the Code
investing $50,000 or more in Fund shares, and (iv) a charitable remainder
trust (as defined in Section 501(c)(3) of the Code).
          The dealer reallowance may be changed from time to time but will
remain the same for all dealers. The Distributor, at its own expense, may
provide additional promotional incentives to dealers that sell shares of
funds advised by The Dreyfus Corporation which are sold with a sales load,
such as the Fund. In some instances, these incentives may be offered only to
certain dealers who have sold or may sell significant amounts of such shares.
Class B Shares _ The public offering price for Class B shares is the net
asset value per share of that Class. No initial sales charge is imposed at
the time of purchase. A CDSC is imposed, however, on certain redemptions of
Class B shares as described under "How to Redeem Shares." The Distributor
compensates certain Service Agents for selling Class B and Class C shares at
the time of purchase from the Distributor's own assets. The proceeds of the
CDSC and the distribution fee, in part, are used to defray these expenses.
Class C Shares _ The public offering price for Class C shares is the net
asset value per share of that Class. No initial sales charge is imposed at
the time of purchase. A CDSC is imposed,  however, on redemptions of Class C
shares made within the first year of purchase. See "Class B Shares" above and
"How to Redeem Shares."
Right of Accumulation _ Class A Shares _ Reduced sales loads apply to any
purchase of Class A shares, shares of other funds in the Dreyfus Premier
Family of Funds, shares of certain other funds advised by The Dreyfus
Corporation which are sold with a sales load and shares acquired by a
previous exchange of such shares (hereinafter referred to as "Eligible
Funds"), by you and any related "purchaser" as defined in the Statement of
Additional Information, where the aggregate investment, including such
purchase, is $50,000 or more. If, for example, you have previously purchased
and still hold Class A shares of the Fund, or of any other Eligible Fund or
combination thereof, with an aggregate current market value of $40,000 and
subsequently purchase Class A shares of the Fund or an Eligible Fund having a
current value of $20,000, the sales load applicable to the subsequent purchase
would be reduced to 4% of the offering price. All present holdings of Eligible
Funds may be combined to determine the current offering price of the
aggregate investment in ascertaining the sales load applicable to each
subsequent purchase. To qualify for reduced sales loads, at the time of
purchase you or your Service Agent must notify the Distributor if orders are
made by wire, or the Transfer Agent if orders are made by mail. The reduced
sales load is subject to confirmation of your holdings through a check of
appropriate records.
TeleTransfer Privilege _ You may purchase Fund shares (minimum $500, maximum
$150,000 per day) by telephone if you have checked the appropriate box and
supplied the necessary information on the Account Application or have filed a
Shareholder Services Form with the Transfer Agent. The proceeds will be
transferred between the bank account designated in one of these documents and
your Fund account. Only a bank account maintained in a domestic financial
institution which is an Automated Clearing House member may be so designated.
The Fund may modify or terminate this Privilege at any time or charge a
service fee upon notice to shareholders. No such fee currently is
contemplated.
          If you have selected the TeleTransfer Privilege, you may request a
TeleTransfer  purchase of shares by calling 1-800-554-4611 or, if you are
calling from overseas, call 516-794-5452.
                             Shareholder Services
          The services and privileges described under this heading may not be
available to clients of certain Service Agents and some Service Agents may
impose certain conditions on their clients which are different from those
described in this Prospectus. You should consult your Service Agent in this
regard.
Fund Exchanges

   
          Clients of certain Service Agents may purchase, in exchange for
shares of a Class, shares of the same Class of certain other funds managed by
The Dreyfus Corporation, to the extent such shares are offered for sale in
such client's state of residence. These funds have different investment
objectives which may be of interest to you. You also
                [Page 11]
          may exchange your Fund shares that are subject to a CDSC for shares
of Dreyfus Worldwide Dollar Money Market Fund, Inc. The shares so purchased
will be held in a special account created solely for this purpose ("Exchange
Account"). Exchanges of shares from an Exchange Account only can be made into
certain other funds managed or administered by The Dreyfus Corporation. No
CDSC is charged when an investor exchanges into an Exchange Account; however,
the applicable CDSC will be imposed when shares are redeemed from an Exchange
Account or other applicable Fund account. Upon redemption, the applicable
CDSC will be calculated without regard to the time such shares were held in
an Exchange Account. See "How to Redeem Shares." Redemption proceeds for
Exchange Account shares are paid by Federal wire or check only. Exchange
Account shares also are eligible for the Auto-Exchange Privilege, Dividend
Sweep and the Automatic Withdrawal Plan. To use this service, you should
consult your Service Agent or call 1-800-554-4611 to determine if it is
available and whether any conditions are imposed on its use. If you are
calling from overseas, call 516-794-5452.
    
   
          To request an exchange, you or your Service Agent acting on your
behalf must give exchange instructions to the Transfer Agent in writing or by
telephone. Before any exchange, you must obtain and should review a copy of
the current prospectus of the fund into which the exchange is being made.
Prospectuses may be obtained by calling 1-800-554-4611. Except in the case of
personal retirement plans, the shares being exchanged must have a current
value of at least $500; furthermore, when establishing a new account by
exchange, the shares being exchanged must have a value of at least the
minimum initial investment required for the fund into which the exchange is
being made. The ability to issue exchange instructions by telephone is given
to all Fund shareholders automatically, unless you check the applicable "No"
box on the Account Application, indicating that you specifically refuse this
Privilege. The Telephone Exchange Privilege may be established for an
existing account by written request signed by all shareholders on the
account, by a separate signed Shareholder Services Form, or by oral request
from any of the authorized signatories on the account. If you have
established the Telephone Exchange Privilege, you may telephone exchange
instructions (including over The Dreyfus TouchRegistration Mark automated
telephone system) by calling one of the telephone numbers set forth above.
See "How to Redeem Shares _ Procedures." Upon an exchange into a new account,
the following shareholder services and privileges, as applicable and where
available, will be automatically carried over to the fund into which the
exchange is made: Telephone Exchange Privilege, Check Redemption Privilege,
TeleTransfer Privilege and the dividend/capital gain distribution option
(except for Dividend Sweep) selected by the investor.
    
   
          Shares will be exchanged at the next determined net asset value;
however, a sales load, which may be waived or reduced as described below, may
be charged with respect to exchanges of Class A shares into funds sold with a
sales load. No CDSC will be imposed on Class B or Class C shares at the time
of an exchange; however, Class B or Class C shares acquired through an
exchange will be subject on redemption to the higher CDSC applicable to the
exchanged or acquired shares. The CDSC applicable on redemption of the
acquired Class B or Class C shares will be calculated from the date of the
initial purchase of the Class B or Class C shares exchanged. If you are
exchanging Class A shares into a fund that charges a sales load, you may
qualify for share prices which do not include the sales load or which reflect
a reduced sales load, if the shares you are exchanging were: (a) purchased
with a sales load, (b) acquired by a previous exchange from shares purchased
with a sales load, or (c) acquired through reinvestment of dividends or
distributions paid with respect to the foregoing categories of shares. To
qualify, at the time of the exchange your Service Agent must notify the
Distributor. Any such qualification is subject to confirmation of your
holdings through a check of appropriate records. See "Shareholder Services"
in the Statement of Additional Information. No fees currently are charged
shareholders directly in connection with exchanges, although the Fund
reserves the right, upon not less than 60 days' written notice, to charge
shareholders a nominal administrative fee in accordance with the rules
promulgated by the Securities and Exchange Commission. The Fund reserves the
right to reject any exchange request in whole or in part. See "Appendix _
Additional Information About Purchases, Exchanges and Redemptions." The
availability of Fund Exchanges may be modified or terminated at any time upon
notice to shareholders. See "Dividends, Distributions and Taxes."
Auto-Exchange Privilege
    

          Auto-Exchange Privilege enables you to invest regularly (on a
semi-monthly, monthly, quarterly or annual basis), in exchange for shares of
the Fund, in shares of the same Class of other funds in the Dreyfus Premier
Family of Funds or certain other funds in the Dreyfus Family of Funds of
which you are a shareholder. The amount you designate, which can be expressed
either in terms of a specific dollar or share amount ($100 minimum), will be
exchanged automatically on the first and/or fifteenth of the month according
to the schedule you have selected. Shares will be exchanged at the
then-current net asset value; however, a sales load may be charged with
respect to exchanges of Class A shares into funds sold with a sales load. No
CDSC will be imposed on Class B or Class C shares at the time of an exchange;
however, Class B or Class C shares acquired through an exchange will be
subject on redemption to the higher CDSC applicable to the exchanged or
acquired shares. The CDSC applicable on redemption of the acquired Class B or
Class C shares will be calculated from the date of the initial
                [Page 12]
purchase of the Class B or Class C shares exchanged. See
"Shareholder Services" in the Statement of Additional Information. The right
to exercise this Privilege may be modified or cancelled by the Fund or the
Transfer Agent. You may modify or cancel your exercise of this Privilege at
any time by mailing written notification to Dreyfus Premier Municipal Bond
Fund, P.O. Box 6587, Providence, Rhode Island 02940-6587. The Fund may charge
a service fee for the use of this Privilege. No such fee currently is
contemplated. For more information concerning this Privilege and the funds in
the Dreyfus Premier Family of Funds or the Dreyfus Family of Funds eligible to
participate in this Privilege, or to obtain an Auto-Exchange Authorization
Form, please call toll free 1-800-554-4611. See "Dividends, Distributions and
Taxes."
Dreyfus-AUTOMATIC Asset BuilderRegistration Mark

   
          Dreyfus-AUTOMATIC Asset Builder permits you to purchase Fund shares
(minimum of $100 and maximum of $150,000 per transaction) at regular
intervals selected by you. Fund shares are purchased by transferring funds
from the bank account designated by you. Only an account maintained at a
domestic financial institution which is an Automated Clearing House member
may be so designated. To establish a Dreyfus-AUTOMATIC Asset Builder account,
you must file an authorization form with the Transfer Agent. You may obtain
the necessary authorization form by calling 1-800-554-4611. You may cancel
your participation in this Privilege or change the amount of purchase at any
time by mailing written notification to Dreyfus Premier Municipal Bond Fund,
P.O. Box 6587, Providence, Rhode Island 02940-6587, and the notification will
be effective three business days following receipt. The Fund may modify or
terminate this Privilege at any time or charge a service fee. No such fee
currently is contemplated.
    

Government Direct Deposit Privilege
          Government Direct Deposit Privilege enables you to purchase Fund
shares (minimum of $100 and maximum of $50,000 per transaction) by having
Federal salary, Social Security, or certain veterans', military or other
payments from the Federal government automatically deposited into your Fund
account. You may deposit as much of such payments as you elect. To enroll in
Government Direct Deposit, you must file with the Transfer Agent a completed
Direct Deposit Sign-Up Form for each type of payment that you desire to
include in this Privilege. The appropriate form may be obtained from your
Service Agent or by calling 1-800-554-4611. Death or legal incapacity will
terminate your participation in this Privilege. You may elect at any time to
terminate your participation by notifying in writing the appropriate Federal
agency. Further, the Fund may terminate your participation upon 30 days'
notice to you.
Dividend Options
          Dividend Sweep enables you to invest automatically dividends or
dividends and capital gain distributions, if any, paid by the Fund in shares
of the same Class of another fund in the Dreyfus Premier Family of Funds or
the Dreyfus Family of Funds of which you are a shareholder. Shares of the
other fund will be purchased at the then-current net asset value; however, a
sales load may be charged with respect to investments in shares of a fund
sold with a sales load. If you are investing in a fund that charges a sales
load, you may qualify for share prices which do not include the sales load or
which reflect a reduced sales load. If you are investing in a fund that
charges a CDSC, the shares purchased will be subject on redemption to the
CDSC, if any, applicable to the purchased shares. See "Shareholder Services"
in the Statement of Additional Information. Dividend ACHpermits you to
transfer electronically dividends or dividends and capital gain
distributions, if any, from the Fund to a designated bank account. Only an
account maintained at a domestic financial institution which is an Automated
Clearing House member may be so designated. Banks may charge a fee for this
service.
          For more information concerning these privileges, or to request a
Dividend Options Form, please call toll free 1-800-554-4611. You may cancel
these privileges by mailing written notification to Dreyfus Premier Municipal
Bond Fund, P.O. Box 6587, Providence, Rhode Island 02940-6587. To select a
new fund after cancellation, you must submit a new Dividend Options Form.
Enrollment in or cancellation of these privileges is effective three business
days following receipt. These privileges are available only for existing
accounts and may not be used to open new accounts. Minimum subsequent
investments do not apply for Dividend Sweep. The Fund may modify or terminate
these privileges at any time or charge a service fee. No such fee currently
is contemplated.
Automatic Withdrawal Plan
   
          The Automatic Withdrawal Plan permits you to request withdrawal of
a specified dollar amount (minimum of $50) on either a monthly or quarterly
basis if you have a $5,000 minimum account. An Automatic Withdrawal Plan may
be established by filing an Automatic Withdrawal Plan application with the
Transfer Agent or by oral request from any of the authorized signatories on
the account by calling 1-800-554-4611. The Automatic Withdrawal Plan may be
ended at any time by you, the Fund or the Transfer Agent. Shares for which
certificates have been issued may not be redeemed through the Automatic
Withdrawal Plan.
    

          No CDSC with respect to Class B shares will be imposed on
withdrawals made under the Automatic Withdrawal Plan, provided that the
amounts withdrawn under the plan do not exceed on an annual basis 12% of the
account value at the time the shareholder elects to participate in the
Automatic Withdrawal Plan. Withdrawals with respect to Class B shares under
the Automatic Withdrawal Plan that exceed on an annual basis 12% of the value
of the share
                [Page 13]
          holder's account will be subject to a CDSC on the amounts exceeding
12% of the initial account value. Withdrawals with respect to Class A shares
subject to a CDSC and Class C shares under the Automatic Withdrawal Plan will
be subject to any applicable CDSC. Purchases of additional Class A shares
where the sales load is imposed concurrently with withdrawals of Class A
shares generally are undesirable.
Letter of Intent _ Class A Shares
          By signing a Letter of Intent form, which can be obtained by
calling 1-800-554-4611, you become eligible for the reduced sales load
applicable to the total number of Eligible Fund shares purchased in a
13-month period pursuant to the terms and conditions set forth in the Letter
of Intent. A minimum initial purchase of $5,000 is required. To compute the
applicable sales load, the offering price of shares you hold (on the date of
submission of the Letter of Intent) in any Eligible Fund that may be used
toward "Right of Accumulation" benefits described above may be used as a
credit toward completion of the Letter of Intent. However, the reduced sales
load will be applied only to new purchases.
          The Transfer Agent will hold in escrow 5% of the amount indicated
in the Letter of Intent for payment of a higher sales load if you do not
purchase the full amount indicated in the Letter of Intent. The escrow will
be released when you fulfill the terms of the Letter of Intent by purchasing
the specified amount. If your purchases qualify for a further sales load
reduction, the sales load will be adjusted to reflect your total purchase at
the end of 13 months. If total purchases are less than the amount specified,
you will be requested to remit an amount equal to the difference between the
sales load actually paid and the sales load applicable to the aggregate
purchases actually made. If such remittance is not received within 20 days,
the Transfer Agent, as attorney-in-fact pursuant to the terms of the Letter
of Intent, will redeem an appropriate number of Class A shares held in escrow
to realize the difference. Signing a Letter of Intent does not bind you to
purchase, or the Fund to sell, the full amount indicated at the sales load in
effect at the time of signing, but you must complete the intended purchase to
obtain the reduced sales load. At the time you purchase Class A shares, you
must indicate your intention to do so under a Letter of Intent. Purchases
pursuant to a Letter of Intent will be made at the then-current net asset
value plus the applicable sales load in effect at the time such Letter of
Intent was executed.
                            How to Redeem Shares
General
   
          You may request redemption of your shares at any time. Redemption
requests should be transmitted to the Transfer Agent as described below. When
a request is received in proper form by the Transfer Agent or other entity
authorized to receive orders on behalf of the Fund, the Fund will redeem the
shares at the next determined net asset value as described below. See
"Appendix _ Additional Information About Purchases, Exchanges and
Redemptions." If you hold Fund shares of more than one Class, any request for
redemption must specify the Class of shares being redeemed. If you fail to
specify the Class of shares to be redeemed or if you own fewer shares of the
Class than specified to be redeemed, the redemption request may be delayed
until the Transfer Agent receives further instructions from you or your
Service Agent.
    

          The Fund imposes no charges (other than any applicable CDSC) when
shares are redeemed. Service Agents may charge their clients a fee for
effecting redemptions of Fund shares. Any certificates representing Fund
shares being redeemed must be submitted with the redemption request. The
value of the shares redeemed may be more or less than their original cost,
depending upon the Fund's then-current net asset value.
          The Fund ordinarily will make payment for all shares redeemed
within seven days after receipt by the Transfer Agent of a redemption request
in proper form, except as provided by the rules of the Securities and
Exchange Commission. However, if you have purchased Fund shares by check, by
the TeleTransfer Privilege or through Dreyfus-AUTOMATIC Asset
BuilderRegistration Mark and subsequently submit a written redemption request
to the Transfer Agent, the redemption proceeds will be transmitted to you
promptly upon bank clearance of your purchase check, TeleTransfer purchase or
Dreyfus-AUTOMATIC Asset Builder order, which may take up to eight business
days or more. In addition, the Fund will not honor Redemption Checks under
the Check Redemption Privilege, and will reject requests to redeem shares
pursuant to the TeleTransfer Privilege, for a period of eight business days
after receipt by the Transfer Agent of the purchase check, the TeleTransfer
purchase or the Dreyfus-AUTOMATIC Asset Builder order against which such
redemption is requested. These procedures will not apply if your shares were
purchased by wire payment, or if you otherwise have a sufficient collected
balance in your account to cover the redemption request. Prior to the time any
redemption is effective, dividends on such shares will accrue and be payable,
and you will be entitled to exercise all other rights of beneficial ownership.
Fund shares will not be redeemed until the Transfer Agent has received your
Account Application.
          The Fund reserves the right to redeem your account at its option
upon not less than 30 days' written notice if your account's net asset value
is $500 or less and remains so during the notice period.

                [Page 14]
Contingent Deferred Sales Charge
Class B Shares _ A CDSC payable to the Distributor is imposed on any
redemption of Class B shares which reduces the current net asset value of
your Class B shares to an amount which is lower than the dollar amount of all
payments by you for the purchase of Class B shares of the Fund held by you at
the time of redemption. No CDSC will be imposed to the extent that the net
asset value of the Class B shares redeemed does not exceed (i) the current
net asset value of Class B shares acquired through reinvestment of dividends
or capital gain distributions, plus (ii) increases in the net asset value of
Class B shares above the dollar amount of all your payments for the purchase
of Class B shares of the Fund held by you at the time of redemption.
          If the aggregate value of the Class B shares redeemed has declined
below their original cost as a result of the Fund's performance, a CDSC may
be applied to the then-current net asset value rather than the purchase
price.
          In circumstances where the CDSC is imposed, the amount of the
charge will depend on the number of years from the time you purchased the
Class B shares until the time of redemption of such shares. Solely for
purposes of determining the number of years from the time of any payment for
the purchase of Class B shares, all payments during a month will be
aggregated and deemed to have been made on the first day of the month.
          The following table sets forth the rates of the CDSC for Class B
shares, except for Class B shares purchased by shareholders who beneficially
owned Class B shares on November 30, 1996:
<TABLE>
<CAPTION>
        Year Since                                                     CDSC as a % of Amount
        Purchase Payment                                              Invested or Redemption
        Was Made                                                            Proceeds
        ________-                                                        _______________
        <S>                                                                   <C>
        First............................................                     4.00
        Second...........................................                     4.00
        Third............................................                     3.00
        Fourth...........................................                     3.00
        Fifth............................................                     2.00
        Sixth............................................                     1.00
          The following table sets forth the rates of the CDSC for Class B
shares purchased by shareholders who beneficially owned Class B shares on
November 30, 1996:
        Year Since                                                     CDSC as a % of Amount
        Purchase Payment                                              Invested or Redemption
        Was Made                                                            Proceeds
        ________-                                                        _______________
        First....................................................             3.00
        Second...................................................             3.00
        Third....................................................             2.00
        Fourth...................................................             2.00
        Fifth....................................................             1.00
        Sixth....................................................             0.00
</TABLE>

          In determining whether a CDSC is applicable to a redemption, the
calculation will be made in a manner that results in the lowest possible rate.
It will be assumed that the redemption is made first of amounts representing
shares acquired pursuant to the reinvestment of dividends and distributions;
then of amounts representing the increase in net asset value of Class B shares
above the total amount of payments for the purchase of Class B shares made
during the preceding six years (five years for shareholders beneficially
owning Class B shares on November 30, 1996); then of amounts representing the
cost of shares purchased six years (five years for shareholders beneficially
owning Class B shares on November 30, 1996) prior to the redemption; and
finally, of amounts representing the cost of shares held for the longest
period of time within the applicable six-year period (five-year period for
shareholders beneficially owning Class B shares on November 30, 1996).
          For example, assume an investor purchased 100 shares at $10 per
share for a cost of $1,000. Subsequently, the shareholder acquired five
additional shares through dividend reinvestment. During the second year after
the purchase the investor decided to redeem $500 of his or her investment.
Assuming at the time of the redemption the net asset value has appreciated to
$12 per share, the value of the investor's shares would be $1,260 (105 shares
at $12 per share). The CDSC would not be applied to the value of the
reinvested dividend shares and the amount which represents appreciation
($260). Therefore, $240 of the $500 redemption proceeds ($500 minus $260)
would be charged at a rate of 4% (the applicable rate in the second year
after purchase) for a total CDSC of $9.60.
Class C Shares _ A CDSC of 1% payable to the Distributor is imposed on any
redemption of Class C shares within one year of the  date of purchase. The
basis for calculating the payment of any such CDSC will be the method used in
calculating the CDSC for Class B shares. See "Contingent Deferred Sales
Charge _ Class B Shares" above.
Waiver of CDSC _ The CDSC will be waived in connection with (a) redemptions
made within one year after the death or disability, as defined in Section
72(m)(7) of the Code, of the shareholder, (b) redemptions by employees
participating in qualified or non-qualified employee benefit plans or other
programs where (i) the employers or affiliated
                [Page 15]
employers maintaining such plans or programs have a minimum of 250
employees eligible for participation in such plans or programs, or (ii) such
plan's or program's aggregate investment in the Dreyfus Family of Funds or
certain other products made available by the Distributor exceeds $1,000,000,
(c) redemptions as a result of a combination of any investment company with
the Fund by merger, acquisition of assets or otherwise, (d) a distribution
following retirement under a tax-deferred retirement plan or upon attaining
age 701\2 in the case of an IRA or Keogh plan or custodial account pursuant
to Section 403(b) of the Code and (e) redemptions pursuant to the Automatic
Withdrawal Plan, as described in the Fund's Prospectus. If the Fund's Board
determines to discontinue the waiver of the CDSC, the disclosure in the
Prospectus will be revised appropriately. Any Fund shares subject to a CDSC
which were purchased prior to the termination of such waiver will have the
CDSC waived as provided in the Prospectus at the time of the purchase of such
shares.
          To qualify for a waiver of the CDSC, at the time of redemption you
must notify the Transfer Agent or your Service Agent must notify the
Distributor. Any such qualification is subject to confirmation of your
entitlement.
Procedures

   
          You may redeem Fund shares by using the regular redemption
procedure through the Transfer Agent, or, for Class A shares, through the
Check Redemption Privilege which is granted automatically (if you invest in
Class A shares) unless you specifically refuse it by checking the applicable
"No" box on the Account Application. The Check Redemption Privilege may be
established for an existing account by a separate signed Shareholder Services
Form. You also may redeem shares through the TeleTransfer Privilege, if you
have checked the appropriate box and supplied the necessary information on
the Account Application or have filed a Shareholder Services Form with the
Transfer Agent. If you are a client of a Selected Dealer, you may redeem
shares through the Selected Dealer. Other redemption procedures may be in
effect for clients of certain Service Agents. The Fund makes available to
certain large institutions the ability to issue redemption instructions
through compatible computer facilities. The Fund reserves the right to refuse
any request made by telephone, including requests made shortly after a change
of address, and may limit the amount involved or the number of such requests.
The Fund may modify or terminate any redemption Privilege at any time or
charge a service fee upon notice to shareholders. No such fee currently is
contemplated. Shares for which certificates have been issued are not eligible
for the Check Redemption or TeleTransfer Privilege.
    
   
          Your redemption request may direct that the redemption proceeds be
used to purchase shares of other funds advised or administered by The Dreyfus
Corporation that are not available through Fund Exchanges. The applicable
CDSC will be charged upon the redemption of Class B or Class C shares. Your
redemption proceeds will be invested in shares of the other fund on the next
business day. Before you make such a request, you must obtain and should
review a copy of the current prospectus of the fund being purchased.
Prospectuses may be obtained by calling 1-800-554-4611. The prospectus will
contain information concerning minimum investment requirements and other
conditions that may apply to your purchase.
    

          If you select the TELETRANSFER redemption privilege or Telephone
Exchange Privilege (which is granted automatically unless you refuse it), you
authorize the Transfer Agent to act on telephone instructions (including over
The Dreyfus TouchRegistration Mark automated telephone system) from any
person representing himself or herself to be you, or a representative of your
Service Agent, and reasonably believed by the Transfer Agent to be genuine.
The Fund will require the Transfer Agent to employ reasonable procedures,
such as requiring a form of personal identification, to confirm that
instructions are genuine and, if it does not follow such procedures, the Fund
or the Transfer Agent may be liable for any losses due to unauthorized or
fraudulent instructions. Neither the Fund nor the Transfer Agent will be
liable for following telephone instructions reasonably believed to be
genuine.
          During times of drastic economic or market conditions, you may
experience difficulty in contacting the Transfer Agent by telephone to
request a redemption or exchange of Fund shares. In such cases, you should
consider using the other redemption procedures described herein. Use of these
other redemption procedures may result in your redemption request being
processed at a later time than it would have been if telephone redemption had
been used. During the delay, the Fund's net asset value may fluctuate.
Regular Redemption _ Under the regular redemption procedure, you may redeem
shares by written request mailed to Dreyfus Premier Municipal Bond Fund, P.O.
Box 6587, Providence, Rhode Island 02940-6587. Redemption requests must be
signed by each shareholder, including each owner of a joint account, and each
signature must be guaranteed. The Transfer Agent has adopted standards and
procedures pursuant to which signature-guarantees in proper form generally
will be accepted from domestic banks, brokers, dealers, credit unions,
national securities exchanges, registered securities associations, clearing
agencies and savings associations, as well as from participants in the New
York Stock Exchange Medallion Signature Program, the Securities Transfer
Agents Medallion Program ("STAMP") and the Stock Exchanges Medallion Program.
If you have any questions with respect to signature-guarantees, please
contact your Service Agent or call the telephone number listed on the cover
of this Prospectus.
          Redemption proceeds of at least $1,000 will be wired to any member
bank of the Federal Reserve System in accordance with a written
signature-guaranteed request.

                [Page 16]
   
Check Redemption Privilege _ Class A Shares _ You may write Redemption
Checks drawn on your Fund account. Redemption Checks may be made payable to
the order of any person in the amount of $500 or more. Potential fluctuations
in the net asset value of Class A shares should be considered in determining
the amount of the check. Redemption Checks should not be used to close your
account. Redemption Checks are free, but the Transfer Agent will impose a fee
for stopping payment of a Redemption Check upon your request or if the
Transfer Agent cannot honor the Redemption Check due to insufficient funds or
other valid reason. You should date your Redemption Checks with the current
date when you write them. Please do not postdate your Redemption Checks. If
you do, the Transfer Agent will honor, upon presentment, even if presented
before the date of the check, all postdated Redemption Checks which are dated
within six months of presentment for payment, if they are otherwise in good
order. This Privilege will be terminated immediately, without notice, with
respect to any account which is, or becomes, subject to backup withholding on
redemptions (see "Dividends, Distributions and Taxes"). Any Redemption Check
written on an account which has become subject to backup withholding on
redemptions will not be honored by the Transfer Agent. The Check Redemption
Privilege is granted automatically unless you refuse it.
    

TeleTransfer Privilege _ You may request by telephone that redemption
proceeds (minimum $500 per day) be transferred between your Fund account and
your bank account. Only a bank account maintained in a domestic financial
institution which is an Automated Clearing House member may be designated.
Redemption proceeds will be on deposit in your account at an Automated
Clearing House member bank ordinarily two days after receipt of the
redemption request or, at your request, paid by check (maximum $150,000 per
day) and mailed to your address. Holders of jointly registered Fund or bank
accounts may redeem through the TeleTransfer Privilege for transfer to their
bank account not more than $250,000 within any 30-day period.
          If you have selected the TeleTransfer Privilege, you may request a
TeleTransfer redemption of shares by calling 1-800-554-4611 or, if you are
calling from overseas, call 516-794-5452.
Redemption Through a Selected Dealer _ If you are a customer of a Selected
Dealer, you may make redemption requests to your Selected Dealer. If the
Selected Dealer transmits the redemption request so that it is received by
the Transfer Agent prior to the close of trading on the floor of the New York
Stock Exchange (currently 4:00 p.m., New York time), the redemption request
will be effective on that day. If a redemption request is received by the
Transfer Agent after the close of trading on the floor of the New York Stock
Exchange, the redemption request will be effective on the next business day.
It is the responsibility of the Selected Dealer to transmit a request so that
it is received in a timely manner. The proceeds of the redemption are
credited to your account with the Selected Dealer. See "How to Buy Shares"
for a discussion of additional conditions or fees that may be imposed upon
redemption.
          In addition, the Distributor or its designee will accept orders
from Selected Dealers with which the Distributor has sales agreements for the
repurchase of shares held by shareholders. Repurchase orders received by the
dealer by the close of trading on the floor of the New York Stock Exchange on
any business day and transmitted to the Distributor or its designee prior to
the close of its business day (normally 5:15 p.m., New York time) are
effected at the price determined as of the close of trading on the floor of
the New York Stock Exchange on that day. Otherwise, the shares will be
redeemed at the next determined net asset value. It is the responsibility of
the Selected Dealer to transmit orders on a timely basis. The Selected Dealer
may charge the shareholder a fee for executing the order. This repurchase
arrangement is discretionary and may be withdrawn at any time.
Reinvestment Privilege

   
          Upon written request, you may reinvest up to the number of Class A
or Class B shares you have redeemed, within 45 days of redemption, at the
then-prevailing net asset value without a sales load, or reinstate your
account for the purpose of exercising Fund Exchanges. Upon reinstatement,
with respect to Class B shares, or Class A shares if such shares were subject
to a CDSC, your account will be credited with an amount equal to the CDSC
previously paid upon redemption of the Class A or Class B shares reinvested.
The Reinvestment Privilege may be exercised only once.
    

                Distribution Plan and Shareholder Services Plan
          Class B and Class C shares are subject to a Distribution Plan and
Class A, Class B and Class C shares are subject to a Shareholder Services
Plan.

   
Distribution Plan _ Under the Distribution Plan, adopted pursuant to Rule
12b-1 under the 1940 Act, the Fund pays the Distributor for distributing
Class B and Class C shares at an annual rate of .50 of 1% of the value of the
average daily net assets of Class B and .75 of 1% of the value of the average
daily net assets of Class C.
    

Shareholder Services Plan _ Under the Shareholder Services Plan, the Fund
pays the Distributor for the provision of certain services to the holders of
Class A, Class B and Class C shares a fee at the annual rate of .25 of 1% of
the value of the average daily net assets of each such Class. The services
provided may include personal services relating to shareholder accounts, such
as answering shareholder inquiries regarding the Fund and providing reports
and other information, and services related to the maintenance of shareholder
accounts. The Distributor may make payments to Service Agents in respect of
these services. The Distributor determines the amounts to be paid to Service
Agents.

                [Page 17]
                        Dividends, Distributions and Taxes
   
          The Fund ordinarily declares dividends from its net investment
income on each day the New York Stock Exchange is open for business. Fund
shares begin earning income dividends on the day immediately available funds
("Federal Funds" (monies of member banks within the Federal Reserve System
which are held on deposit at a Federal Reserve Bank)) are received by the
Transfer Agent. If a purchase order is not accompanied by remittance in
Federal Funds, there may be a delay between the time the purchase order
becomes effective and the time the shares purchased start earning dividends.
If your payment is not made in Federal Funds, it must be converted into
Federal Funds. This usually occurs within one business day of receipt of a
bank wire and within two business days of receipt of a check drawn on a member
bank of the Federal Reserve System. Checks drawn on banks which are not
members of the Federal Reserve System may take considerably longer to convert
into Federal Funds.
    
   
          Dividends usually are paid on the last calendar day of each month
and are automatically reinvested in additional shares of the same Class from
which they were paid at net asset value without a sales load or, at your
option, paid in cash. The Fund's earnings for Saturdays, Sundays and holidays
are declared as dividends on the preceding business day. If you redeem all
shares in your account at any time during the month, all dividends to which
you are entitled will be paid to you along with the proceeds of the
redemption. If you are an omnibus accountholder and indicate in a partial
redemption request that a portion of any accrued dividends to which such
account is entitled belongs to an underlying accountholder who has redeemed
all shares in his or her account, such portion of the accrued dividends will
be paid to you along with the proceeds of the redemption. Distributions from
net realized securities gains, if any, generally are declared and paid once a
year, but the Fund may make distributions on a more frequent basis to comply
with the distribution requirements of the Code, in all events in a manner
consistent with the provisions of the 1940 Act. The Fund will not make
distributions from net realized securities gains unless capital loss
carryovers, if any, have been utilized or have expired. You may choose
whether to receive dividends and distributions in cash or to reinvest in
additional shares of the same Class from which they were paid at net asset
value. If you elect to receive dividends and distributions in cash, and your
dividend or distribution check is returned to the Fund as undeliverable or
remains uncashed for six months, the Fund reserves the right to reinvest such
dividend or distribution and all future dividends and distributions payable
to you in additional Fund shares at net asset value. No interest will accrue
on amounts represented by uncashed distribution or redemption checks. All
expenses are accrued daily and deducted before declaration of dividends to
investors. Dividends paid by each Class will be calculated at the same time
and in the same manner and will be of the same amount, except that the
expenses attributable solely to a particular Class will be borne exclusively
by such Class. Class B and Class C shares will receive lower per share
dividends than Class A shares because of the higher expenses borne by the
relevant Class. See "Fee Table."
    
   
          Except for dividends from Taxable Investments, the Fund anticipates
that substantially all dividends paid by the Fund will not be subject to
Federal income tax. No dividend paid by the Fund will qualify for the
dividends received deduction allowable to certain U.S. corporations.
Dividends derived from Taxable Investments, together with distributions from
any net realized short-term securities gains and all or a portion of any
gains realized from the sale or other disposition of certain market discount
bonds, paid by the Fund are subject to Federal income tax as ordinary income
whether received in cash or reinvested in additional shares. Distributions
from net realized long-term securities gains of the Fund generally are
subject to Federal income tax as long-term capital gains, if you are a
citizen or resident of the United States. The Code provides that an
individual generally will be taxed on his or her net capital gain at a
maximum rate of 20% with respect to capital gains from securities held for
more than 12 months. Under the Code, interest on indebtedness incurred or
continued to purchase or carry Fund shares which is deemed to relate to
exempt-interest dividends is not deductible. Dividends and distributions may
be subject to state and local taxes.
    

          Although all or a substantial portion of the dividends paid by the
Fund may be excluded by shareholders of the Fund from their gross income for
Federal income tax purposes, the Fund may purchase specified private activity
bonds, the interest from which may be (i) a preference item for purposes of
the alternative minimum tax, or (ii) a factor in determining the extent to
which a shareholder's Social Security benefits are taxable. If the Fund
purchases such securities, the portion of the Fund's dividends related
thereto will not necessarily be tax exempt to an investor who is subject to
the alternative minimum tax and/or tax on Social Security benefits and may
cause an investor to be subject to such taxes.
          The exchange of shares of one fund for shares of another is treated
for Federal income tax purposes as a sale of the shares given in exchange by
the shareholder and, therefore, an exchanging shareholder may realize a
taxable gain or loss.
          The Code provides for the "carryover" of some or all of the sales
load imposed on Class A shares if you exchange your Class A shares for shares
of another fund advised or administered by The Dreyfus Corporation within 91
days of purchase and such other fund reduces or eliminates its otherwise
applicable sales load for the purpose of the exchange. In this case, the
amount of the sales load charge for Class A shares, up to the amount of the
reduction of
                [Page 18]
the sales load charge on the exchange, is not included in the basis
of your Class A shares for purposes of computing gain or loss on the
exchange, and instead is added to the basis of the fund shares received on
the exchange.
          Notice as to the tax status of your dividends and distributions
will be mailed to you annually. You also will receive periodic summaries of
your account which will include information as to dividends and distributions
from securities gains, if any, paid during the year. These statements set
forth the dollar amount of income exempt from Federal tax and the dollar
amount, if any, subject to Federal tax. These dollar amounts will vary
depending on the size and length of time of your investment in the Fund. If
the Fund pays dividends derived from taxable income, it intends to designate
as taxable the same percentage of the day's dividends as the actual taxable
income earned on that day bears to total income earned on that day. Thus, the
percentage of the dividend designated as taxable, if any, may vary from day
to day.
          Federal regulations generally require the Fund to withhold ("backup
withholding") and remit to the U.S. Treasury 31% of taxable dividends,
distributions from net realized securities gains and the proceeds of any
redemption, regardless of the extent to which gain or loss may be realized,
paid to a shareholder if such shareholder fails to certify either that the
TIN furnished in connection with opening an account is correct or that such
shareholder has not received notice from the IRS of being subject to backup
withholding as a result of a failure to properly report taxable dividend or
interest income on a Federal income tax return. Furthermore, the IRS may
notify the Fund to institute backup withholding if the IRS determines a
shareholder's TIN is incorrect or if a shareholder has failed to properly
report taxable dividend and interest income on a Federal income tax return.

   
          A TIN is either the Social Security number, IRS individual taxpayer
identification number, or employer identification number of the record owner
of the account. Any tax withheld as a result of backup withholding does not
constitute an additional tax imposed on the record owner of the account, and
may be claimed as a credit on the record owner's Federal income tax return.
    
   
          Management of the Fund believes that the Fund has qualified for the
fiscal year ended April 30, 1998 as a "regulated investment company" under
the Code. The Fund intends to continue to so qualify, if such qualification
is in the best interests of its shareholders. Such qualification relieves the
Fund of any liability for Federal income taxes to the extent its earnings are
distributed in accordance with applicable provisions of the Code. The Fund is
subject to a non-deductible 4% excise tax, measured with respect to certain
undistributed amounts of taxable investment income and capital gains.
    

          You should consult your tax adviser regarding specific questions as
to Federal, state or local income taxes.
                           Performance Information
          For purposes of advertising, performance for each Class of shares
may be calculated on several bases, including current yield, tax equivalent
yield, average annual total return and/or total return. These total return
figures reflect changes in the price of the shares and assume that any income
dividends and/or capital gains distributions made by the Fund during the
measuring period were reinvested in shares of the same Class. Class A total
return figures include the maximum initial sales charge and Class B and Class
C total return figures include any applicable CDSC. These figures also take
into account any applicable service and distribution fees. As a result, at
any given time, the performance of Class B or Class C should be expected to
be lower than that of Class A. Performance for each Class will be calculated
separately.
          Current yield refers to the Fund's annualized net investment income
per share over a 30-day period, expressed as a percentage of the net asset
value (or maximum offering price in the case of Class A) per share at the end
of the period. For purposes of calculating current yield, the amount of net
investment income per share during that 30-day period, computed in accordance
with regulatory requirements, is compounded by assuming that it is reinvested
at a constant rate over a six-month period. An identical result is then
assumed to have occurred during a second six-month period which, when added
to the result for the first six months, provides an "annualized" yield for an
entire one-year period. Calculations of the Fund's current yield may reflect
absorbed expenses pursuant to any undertaking that may be in effect. See
"Management of the Fund."
          Tax equivalent yield is calculated by determining the pre-tax yield
which, after being taxed at a stated rate, would be equivalent to a stated
current yield calculated as described above.
          Average annual total return is calculated pursuant to a
standardized formula which assumes that an investment in the Fund was
purchased with an initial payment of $1,000 and that the investment was
redeemed at the end of a stated period of time, after giving effect to the
reinvestment of dividends and distributions during the period. The return is
expressed as a percentage rate which, if applied on a compounded annual
basis, would result in the redeemable value of the investment at the end of
the period. Advertisements of the Fund's performance will include the Fund's
average annual total return for one, five and ten year periods.
          Total return is computed on a per share basis and assumes the
reinvestment of dividends and distributions. Total return generally is
expressed as a percentage rate which is calculated by combining the income
and principal changes
                [Page 19]
for a specified period and dividing by the net asset value (or
maximum offering price in the case of Class A) per share at the beginning of
the period. Advertisements may include the percentage rate of total return or
may include the value of a hypothetical investment at the end of the period
which assumes the application of the percentage rate of total return. Total
return also may be calculated by using the net asset value per share at the
beginning of the period instead of the maximum offering price per share at
the beginning of the period for Class A shares or without giving effect to
any applicable CDSC at the end of the period for Class B or Class C shares.
Calculations based on the net asset value per share do not reflect the
deduction of the applicable sales charge on Class A shares which, if
reflected, would reduce the performance quoted.
          Performance will vary from time to time and past results are not
necessarily representative of future results. Investors should remember that
performance is a function of portfolio management in selecting the type and
quality of portfolio securities and is affected by operating expenses.
Performance information, such as that described above, may not provide a
basis for comparison with other investments or other investment companies
using a different method of calculating performance.
          Comparative performance information may be used from time to time
in advertising the Fund's shares, including data from Lipper Analytical
Services, Inc., Moody's Bond Survey Bond Index, Lehman Brothers Municipal
Bond Index, Morningstar, Inc. and other industry publications.
                             General Information
   
          The Fund was organized as an unincorporated business trust under
the laws of the Commonwealth of Massachusetts pursuant to an Agreement and
Declaration of Trust (the "Trust Agreement") dated June 4, 1986, and
commenced operations on November 26, 1986. Before July 2, 1990, the Fund's
name was Premier Tax Exempt Bond Fund and, before March 31, 1997, its name
was Premier Municipal Bond Fund. The Fund is authorized to issue an unlimited
number of shares of beneficial interest, par value $.001 per share. The
Fund's shares are classified into three classes _ Class A, Class B and Class
C. Each share has one vote and shareholders will vote in the aggregate and
not by class except as otherwise required by law. Only holders of Class B or
Class C shares, as the case may be, will be entitled to vote on matters
submitted to shareholders pertaining to the Distribution Plan. The Fund
ordinarily will not hold shareholder meetings; however, shareholders under
certain circumstances may have the right to call a meeting of shareholders
for the purpose of voting to remove Trustees.
    

          The Transfer Agent maintains a record of your ownership and sends
you confirmations and statements of account.
          Shareholder inquiries may be made to your Service Agent or by
writing to the Fund at 144 Glenn Curtiss Boulevard, Uniondale, New York
11556-0144.

                [Page 20]
                                 Appendix
Investment Techniques
Borrowing Money _ The Fund is permitted to borrow to the extent permitted
under the 1940 Act, which permits an investment company to borrow in an
amount up to 33 1\3% of the value of its total assets. The Fund currently
intends to borrow money only for temporary or emergency (not leveraging)
purposes in an amount up to 15% of the value of the Fund's total assets
(including the amount borrowed) valued at the lesser of cost or market, less
liabilities (not including the amount borrowed) at the time the borrowing is
made. While borrowings exceed 5% of the value of the Fund's total assets, the
Fund will not make any additional investments.

   
Short-Selling _ In these transactions, the Fund sells a security it does not
own in anticipation of a decline in the market value of the security. To
complete the transaction, the Fund must borrow the security to make delivery
to the buyer. The Fund is obligated to replace the security borrowed by
purchasing it at the market price at the time of replacement. The price at
such time may be more or less than the price at which the security was sold
by the Fund, which would result in a loss or gain, respectively.
    

          Securities will not be sold short if, after effect is given to any
such short sale, the total market value of all securities sold short would
exceed 25% of the value of the Fund's net assets. The Fund may not make a
short sale which results in the Fund having sold short in the aggregate more
than 5% of the outstanding securities of any class of an issuer.
          The Fund also may make short sales "against the box," in which the
Fund enters into a short sale of a security it owns. At no time will the Fund
have more than 15% of the value of its net assets in deposits on short sales
against the box.

   
Use of Derivatives _ The Fund may invest in, or enter into, the types of
Derivatives enumerated under "Description of the Fund _ Investment
Considerations and Risks _ Use of Derivatives." These instruments and
certain related risks are described more specifically under "Investment
Objective and Management Policies _ Management Policies _ Derivatives" in
the Statement of Additional Information.
    
   
          Derivatives may entail investment exposures that are greater than
their cost would suggest, meaning that a small investment in Derivatives
could have a large potential impact on the Fund's performance.
    
   
          If the Fund invests in Derivatives at inopportune times or judges
the market conditions incorrectly, such investments may lower the Fund's
return or result in a loss. The Fund also could experience losses if its
Derivatives were poorly correlated with its other investments, or if the Fund
were unable to liquidate its position because of an illiquid secondary
market. The market for many Derivatives is, or suddenly can become, illiquid.
Changes in liquidity may result in significant, rapid and unpredictable
changes in the prices for Derivatives.
    

          Although the Fund is not a commodity pool, certain Derivatives
subject the Fund to the rules of the Commodity Futures Trading Commission
which limit the extent to which the Fund can invest in such Derivatives.
TheFund may invest in futures contracts and options with respect thereto for
hedging purposes without limit. However, the Fund may not invest in such
contracts and options for other purposes if the sum of the amount of initial
margin deposits and premiums paid for unexpired options with respect to such
contracts, other than bona fide hedging purposes, exceeds 5% of the
liquidation value of the Fund's assets, after taking into account unrealized
profits and unrealized losses on such contracts and options; provided,
however, that in the case of an option that is in-the-money at the time of
purchase, the in-the-money amount may be excluded in calculating the 5%
limitation.
          The Fund may invest up to 5% of its assets, represented by the
premium paid, in the purchase of call and put options. The Fund may write
(i.e., sell) covered call and put option contracts to the extent of 20% of
the value of its net assets at the time such option contracts are written.
When required by the Securities and Exchange Commission, theFund will set
aside permissible liquid assets in a segregated account to cover its
obligations relating to its transactions in Derivatives. To maintain this
required cover, the Fund may have to sell portfolio securities at
disadvantageous prices or times since it may not be possible to liquidate a
Derivative position at a reasonable price.
Lending Portfolio Securities _ The Fund may lend securities from its
portfolio to brokers, dealers and other financial institutions needing to
borrow securities to complete certain transactions. The Fund continues to be
entitled to payments in amounts equal to the interest or other distributions
payable on the loaned securities which affords the Fund an opportunity to
earn interest on the amount of the loan and on the loaned securities'
collateral. Loans of portfolio securities may not exceed 331\3% of the value
of the Fund's total assets, and the Fund will receive collateral consisting
of cash, U. S. Government securities or irrevocable letters of credit which
will be maintained at all times in an amount equal to at least 100% of the
current market value of the loaned securities. Such loans are terminable at
any time upon specified notice. The Fund might experience risk of loss if the
institution with which it has engaged in a portfolio loan transaction
breaches its agreement with the Fund.

   
Forward Commitments _ The Fund may purchase or sell Municipal Obligations
and other securities on a forward commitment, when-issued, or delayed
delivery basis, which means delivery and payment take place a number
                [Page 21]
of days after the date of the commitment to purchase. The payment obligation
and the interest rate receivable on a forward commitment or when-issued
security are fixed when the Fund enters into the commitment, but the Fund
does not make payment until it receives delivery from the counterparty. The
Fund will commit to purchase such securities only with the intention of
actually acquiring the securities, but the Fund may sell these securities
before the settlement date if it is deemed advisable. The Fund will set aside
in a segregated account permissible liquid assets at least equal at all times
to the amount of the Fund's purchase commitments.
    

Certain Portfolio Securities
Certain Tax Exempt Obligations _ The Fund may purchase floating and variable
rate demand notes and bonds, which are tax exempt obligations ordinarily
having stated maturities in excess of one year, but which permit the holder
to demand payment of principal at any time or at specified intervals.
Variable rate demand notes include master demand notes which are obligations
that permit the Fund to invest fluctuating amounts at varying rates of
interest, pursuant to direct arrangements between the Fund, as lender, and
the borrower. These obligations permit daily changes in the amount borrowed.
Because these obligations are direct lending arrangements between the lender
and borrower, it is not contemplated that such instruments generally will be
traded, and there generally is no established secondary market for these
obligations, although they are redeemable at face value, plus accrued
interest. Accordingly, where these obligations are not secured by letters of
credit or other credit support arrangements, the Fund's right to redeem is
dependent on the ability of the borrower to pay principal and interest on
demand. Each obligation purchased by the Fund will meet the quality criteria
established for the purchase of Municipal Obligations.
Tax Exempt Participation Interests _ The Fund may purchase from financial
institutions participation interests in Municipal Obligations (such as
industrial development bonds and municipal lease/purchase agreements). A
participation interest gives the Fund an undivided interest in the Municipal
Obligation in the proportion that the Fund's participation interest bears to
the total principal amount of the Municipal Obligation. These instruments may
have fixed, floating or variable rates of interest. If the participation
interest is unrated, it will be backed by an irrevocable letter of credit or
guarantee of a bank that the Fund's Board has determined meets prescribed
quality standards for banks, or the payment obligation otherwise will be
collateralized by U.S. Government securities. For certain participation
interests, the Fund will have the right to demand payment, on not more than
seven days' notice, for all or any part of the Fund's participation interest
in the Municipal Obligation, plus accrued interest. As to these instruments,
the Fund intends to exercise its right to demand payment only upon a default
under the terms of the Municipal Obligation, as needed to provide liquidity
to meet redemptions, or to maintain or improve the quality of its investment
portfolio.
Tender Option Bonds _ The Fund may purchase tender option bonds. A tender
option bond is a Municipal Obligation (generally held pursuant to a custodial
arrangement) having a relatively long maturity and bearing interest at a
fixed rate substantially higher than prevailing short-term tax exempt rates,
that has been coupled with the agreement of a third party, such as a bank,
broker-dealer or other financial institution, pursuant to which such
institution grants the security holders the option, at periodic intervals, to
tender their securities to the institution and receive the face value
thereof. As consideration for providing the option, the financial institution
receives periodic fees equal to the difference between the Municipal
Obligation's fixed coupon rate and the rate, as determined by a remarketing
or similar agent at or near the commencement of such period, that would cause
the securities, coupled with the tender option, to trade at par on the date
of such determination. Thus, after payment of this fee, the security holder
effectively holds a demand obligation that bears interest at the prevailing
short-term tax exempt rate. The Dreyfus Corporation, on behalf of the Fund,
will consider on an ongoing basis the creditworthiness of the issuer of the
underlying Municipal Obligations, of any custodian and of the third party
provider of the tender option. In certain instances and for certain tender
option bonds, the option may be terminable in the event of a default in
payment of principal or interest on the underlying Municipal Obligations and
for other reasons.
Custodial Receipts _ The Fund may purchase custodial receipts representing
the right to receive certain future principal and interest payments on
Municipal Obligations which underlie the custodial receipts. A number of
different arrangements are possible. In a typical custodial receipt
arrangement, an issuer or a third party owner of Municipal Obligations
deposits such obligations with a custodian in exchange for two classes of
custodial receipts. The two classes have different characteristics, but, in
each case, payments on the two classes are based on payments received on the
underlying Municipal Obligations. One class has the characteristics of a
typical auction rate security, where at specified intervals its interest rate
is adjusted, and ownership changes, based on an auction mechanism. This
class's interest rate generally is expected to be below the coupon rate of
the underlying Municipal Obligations and generally is at a level comparable
to that of a Municipal Obligation of similar quality and having a maturity
equal to the period between interest rate adjustments. The second class bears
interest at a rate that exceeds the interest rate typically borne by a
security of comparable quality and maturity; this rate also is adjusted, but
in this case inversely to changes in the rate of interest of the first class.
In no event will the aggregate interest paid with respect to the two classes
exceed the interest paid by the underlying Municipal Obligations. The value
of the second class and similar securities should be expected to fluctuate
more than the value of a Municipal Obligation of comparable quality and
maturity and their
                [Page 22]
purchase by the Fund should increase the volatility of its net asset value
and, thus, its price per share. These custodial receipts are sold in private
placements. The Fund also may purchase directly from issuers, and not in a
private placement, Municipal Obligations having characteristics similar to
custodial receipts. These securities may be issued as part of a multi-class
offering and the interest rate on certain classes may be subject to a cap or
floor.
Stand-By Commitments _ The Fund may acquire "stand-by commitments" with
respect to Municipal Obligations held in its portfolio. Under a stand-by
commitment, the Fund obligates a broker, dealer or bank to repurchase, at the
Fund's option, specified securities at a specified price and, in this
respect, stand-by commitments are comparable to put options. The exercise of
a stand-by commitment, therefore, is subject to the ability of the seller to
make payment on demand. The Fund will acquire stand-by commitments solely to
facilitate portfolio liquidity and does not intend to exercise its rights
thereunder for trading purposes. The Fund may pay for stand-by commitments if
such action is deemed necessary, thus increasing to a degree the cost of the
underlying Municipal Obligation and similarly decreasing such security's
yield to investors. Gains realized in connection with stand-by commitments
will be taxable. The Fund also may acquire call options on specific Municipal
Obligations. The Fund generally would purchase these call options to protect
the Fund from the issuer of the related Municipal Obligation redeeming, or
other holder of the call option from calling away, the Municipal Obligation
before maturity. The sale by the Fund of a call option that it owns on a
specific Municipal Obligation could result in the receipt of taxable income
by the Fund.
Zero Coupon Securities _ The Fund may invest in zero coupon securities which
are debt securities issued or sold at a discount from their face value which
do not entitle the holder to any periodic payment of interest prior to
maturity or a specified redemption date (or cash payment date). The amount of
the discount varies depending on the time remaining until maturity or cash
payment date, prevailing interest rates, liquidity of the security and
perceived credit quality of the issuer. Zero coupon securities also may take
the form of debt securities that have been stripped of their unmatured
interest coupons, the coupons themselves and receipts or certificates
representing interests in such stripped debt obligations and coupons. The
market prices of zero coupon securities generally are more volatile than the
market prices of securities that pay interest periodically and are likely to
respond to a greater degree to changes in interest rates than non-zero coupon
securities having similar maturities and credit qualities.
Illiquid Securities _ The Fund may invest up to 15% of the value of its net
assets in securities as to which a liquid trading market does not exist,
provided such investments are consistent with the Fund's investment
objective. Such securities may include securities that are not readily
marketable, such as certain securities that are subject to legal or
contractual restrictions on resale, and repurchase agreements providing for
settlement in more than seven days after notice. As to these securities, the
Fund is subject to a risk that should the Fund desire to sell them when a
ready buyer is not available at a price the Fund deems representative of
their value, the value of the Fund's net assets could be adversely affected.
Taxable Investments _ From time to time, on a temporary basis other than for
temporary defensive purposes (but not to exceed 20% of the value of the
Fund's net assets) or for temporary defensive purposes, the Fund may invest
in taxable short-term investments ("Taxable Investments") consisting of:
notes of issuers having, at the time of purchase, a quality rating within the
two highest grades of Moody's, S&P or Fitch; obligations of the U.S.
Government, its agencies or instrumentalities; commercial paper rated not
lower than P-1 by Moody's, A-1 by S&P or F-1 by Fitch; certificates of
deposit of U.S. domestic banks, including foreign branches of domestic banks,
with assets of one billion dollars or more; time deposits; bankers'
acceptances and other short-term bank obligations; and repurchase agreements
in respect of any of the foregoing. Dividends paid by the Fund that are
attributable to income earned by the Fund from Taxable Investments will be
taxable to investors. See "Dividends, Distributions and Taxes." Except for
temporary defensive purposes, at no time will more than 20% of the value of
the Fund's net assets be invested in Taxable Investments. Under normal market
conditions, the Fund anticipates that not more than 5% of the value of its
total assets will be invested in any one category of Taxable Investments.
Taxable Investments are more fully described in the Statement of Additional
Information, to which reference hereby is made.
Ratings _ Bonds rated Ba by Moody's are judged to have speculative elements;
their future cannot be considered as well assured and often the protection of
interest and principal payments may be very moderate. Bonds rated BB by S&P
are regarded as having predominantly speculative characteristics and, while
such obligations have less near-term vulnerability to default than other
speculative grade debt, they face major ongoing uncertainties or exposure to
adverse business, financial or economic conditions which could lead to
inadequate capacity to meet timely interest and principal payments. Bonds
rated BB by Fitch are considered speculative and the payment of principal and
interest may be affected at any time by adverse economic changes. Bonds rated
C by Moody's are regarded as having extremely poor prospects of ever
attaining any real investment standing. Bonds rated D by S&P are in default
and the payment of interest and/or repayment of principal is in arrears.
Bonds rated DDD, DD or D by Fitch are in actual or imminent default, are
extremely speculative and should be valued on the basis of their ultimate
recovery value in liquidation or reorganization of the issuer; DDD represents
the highest potential for recovery of such bonds; and D represents the lowest
potential for recovery.
                [Page 23]
Such bonds, though high yielding, are characterized by great risk. See
"Appendix" in the Statement of Additional Information for a general
description of Moody's, S&P and Fitch ratings of Municipal Obligations.
          The ratings of Moody's, S&P and Fitch represent their opinions as
to the quality of the Municipal Obligations which they undertake to rate. It
should be emphasized, however, that ratings are relative and subjective and,
although ratings may be useful in evaluating the safety of interest and
principal payments, they do not evaluate the market value risk of these
bonds. Although these ratings may be an initial criterion for selection of
portfolio investments, The Dreyfus Corporation also will evaluate these
securities and the ability of the issuers of such securities to pay interest
and principal. The Fund's ability to achieve its investment objective may be
more dependent on The Dreyfus Corporation's credit analysis than might be the
case for a fund that invested in higher rated securities.
          The average distribution of investments (at value) in Municipal
Obligations by ratings for the fiscal year ended April 30, 1998, computed on
a monthly basis, was as follows:
<TABLE>
<CAPTION>

    <S>                                                                          PERCENTAGE
    FITCH                     MOODY'S                 S&P                         OF VALUE
    ______                    ________                _______                    ___________
    <C>                       <C>                     <C>                         <C>
    AAA                       Aaa                     AAA                         10.3%
    A                         A                       A                           12.2
    BBB                       Baa                     BBB                         35.5
    BB                        Ba                      BB                          16.0
    B                         B                       B                            1.2
    F-1                       VMIG1, MIG1, P-1        SP-1, A-1                     .1
    Not Rated                 Not Rated               Not Rated                   24.7*
                                                                                 ____-
                                                                                 100.0%
                                                                                 =====
</TABLE>
   
        *  Included in the Not Rated category are securities comprising 24.7%
of the Fund's market value which, while not rated, have been determined by
The Dreyfus Corporation to be of comparable quality to securities in the
following rating categories: AAA/Aaa (5.4%); A/A (.4%); BBB/Baa (14.4%);
BB/Ba (2.4%); B/B (1.2%); CCC/Caa (.4%); and DDD/D (.5%).
    

          The actual distribution of the Fund's investments in Municipal
Obligations by ratings on any given date will vary. In addition, the
distribution of the Fund's investments by ratings as set forth above should
not be considered as representative of the Fund's future portfolio
composition.

   
ADDITIONAL INFORMATION ABOUT PURCHASES, EXCHANGES AND REDEMPTIONS _ The Fund
is intended to be a long-term investment vehicle and is not designed to
provide investors with a means of speculation on short-term market movements.
A pattern of frequent purchases and exchanges can be disruptive to efficient
portfolio management and, consequently, can be detrimental to the Fund's
performance and its shareholders. Accordingly, if the Fund's management
determines that an investor is engaged in excessive trading, the Fund, with
or without prior notice, may temporarily or permanently terminate the
availability of Fund Exchanges, or reject in whole or part any purchase or
exchange request, with respect to such investor's account. Such investors
also may be barred from purchasing other funds in the Dreyfus Family of
Funds. Generally, an investor who makes more than four exchanges out of the
Fund during any calendar year (for calendar year 1998, beginning on January
15th) or who makes exchanges that appear to coincide with an active
market-timing strategy may be deemed to be engaged in excessive trading.
Accounts under common ownership or control will be considered as one account
for purposes of determining a pattern of excessive trading. In addition, the
Fund may refuse or restrict purchase or exchange requests by any person or
group if, in the judgment of the Fund's management, the Fund would be unable
to invest the money effectively in accordance with its investment objective
and policies or could otherwise be adversely affected or if the Fund receives
or anticipates receiving simultaneous orders that may significantly affect
the Fund (e.g., amounts equal to 1% or more of the Fund's total assets). If
an exchange request is refused, the Fund will take no other action with
respect to the shares until it receives further instructions from the
investor. The Fund may delay forwarding redemption proceeds for up to seven
days if the investor redeeming shares is engaged in excessive trading or if
the amount of the redemption request otherwise would be disruptive to
efficient portfolio management or would adversely affect the Fund. The Fund's
policy on excessive trading applies to investors who invest in the Fund
directly or through financial intermediaries, but does not apply to the
Dreyfus Auto-Exchange Privilege, to any automatic investment or withdrawal
privilege described herein, or to participants in employer-sponsored
retirement plans.
        During times of drastic economic or market conditions, the Fund may
suspend Fund Exchanges temporarily without notice and treat exchange requests
based on their separate components _ redemption orders with a simultaneous
request to purchase the other fund's shares. In such a case, the redemption
request would be processed at the Fund's next determined net asset value but
the purchase order would be effective only at the net asset value next
determined after the fund being purchased receives the proceeds of the
redemption, which may result in the purchase being delayed.

                [Page 24]
          No person has been authorized to give any information or to make
any representations other than those contained in this Prospectus and in the
Fund's official sales literature in connection with the offer of the Fund's
shares, and, if given or made, such other information or representations must
not be relied upon as having been authorized by the Fund. This Prospectus
does not constitute an offer in any State in which, or to any person to whom,
such offering may not lawfully be made.
    


                [Page 25]
[Application_2 Pages]

                [Page 26]
[Application_2 Pages]
                [Page 27]
Copy Rights 1998 Dreyfus Service Corporation                          022p0998




               DREYFUS PREMIER MUNICIPAL BOND FUND
               CLASS A, CLASS B AND CLASS C SHARES
              (STATEMENT OF ADDITIONAL INFORMATION)
                        SEPTEMBER 1, 1998


     This Statement of Additional Information, which is not a
prospectus, supplements and should be read in conjunction with
the current Prospectus of Dreyfus Premier Municipal Bond Fund
(the "Fund"), dated September 1, 1998, as it may be revised from
time to time.  To obtain a copy of the Fund's Prospectus, please
write to the Fund at 144 Glenn Curtiss Boulevard, Uniondale, New
York 11556-0144.

     The Dreyfus Corporation (the "Manager") serves as the Fund's
investment adviser.

     Premier Mutual Fund Services, Inc. (the "Distributor") is
the distributor of the Fund's shares.


                       TABLE OF CONTENTS
                                                            Page
   
Investment Objective and Management Policies               B-2
Management of the Fund                                     B-11
Management Agreement                                       B-16
Purchase of Shares                                         B-18
Distribution Plan and Shareholder Services Plan            B-20
Redemption of Shares                                       B-21
Shareholder Services                                       B-23
Determination of Net Asset Value                           B-25
Dividends, Distributions and Taxes                         B-26
Portfolio Transactions                                     B-28
Performance Information                                    B-29
Information About the Fund                                 B-30
Transfer and Dividend Disbursing Agent, Custodian,
  Counsel and Independent Auditors                         B-31
Financial Statements and Report of Independent Auditors    B-32
Appendix                                                   B-33
    

          INVESTMENT OBJECTIVE AND MANAGEMENT POLICIES

     The following information supplements and should be read in
conjunction with the sections in the Fund's Prospectus entitled
"Description of the Fund" and "Appendix."

Portfolio Securities

     Municipal Obligations.  The term "Municipal Obligations"
generally includes debt obligations issued to obtain funds for
various public purposes, including the construction of a wide
range of public facilities such as airports, bridges, highways,
housing, hospitals, mass transportation, schools, streets and
water and sewer works.  Other public purposes for which Municipal
Obligations may be issued include refunding outstanding
obligations, obtaining funds for general operating expenses and
lending such funds to other public institutions and facilities.
In addition, certain types of industrial development bonds are
issued by or on behalf of public authorities to obtain funds to
provide for the construction, equipment, repair or improvement of
privately operated housing facilities, sports facilities,
convention or trade show facilities, airport, mass transit,
industrial, port or parking facilities, air or water pollution
control facilities and certain local facilities for water supply,
gas, electricity or sewage or solid waste disposal; the interest
paid on such obligations may be exempt from Federal income tax,
although current tax laws place substantial limitations on the
size of such issues.  Such obligations are considered to be
Municipal Obligations if the interest paid thereon qualifies as
exempt from Federal income tax in the opinion of bond counsel to
the issuer.  There are, of course, variations in the security of
Municipal Obligations both within a particular classification and
between classifications.

     Floating and variable rate demand obligations are tax exempt
obligations ordinarily having stated maturities in excess of one
year, but which permit the holder to demand payment of principal
at any time, or at specified intervals.  The issuer of such
obligations ordinarily has a corresponding right, after a given
period, to prepay in its discretion the outstanding principal
amount of the obligations plus accrued interest upon a specified
number of days' notice to the holders thereof.  The interest rate
on a floating rate demand obligation is based on a known lending
rate, such as a bank's prime rate, and is adjusted automatically
each time such rate is adjusted.  The interest rate on a variable
rate demand obligation is adjusted automatically at specified
intervals.

     For the purpose of diversification under the Investment
Company Act of 1940, as amended (the "1940 Act"), the
identification of the issuer of Municipal Obligations depends on
the terms and conditions of the security.  When the assets and
revenues of an agency, authority, instrumentality or other
political subdivision are separate from those of the government
creating the subdivision and the security is backed only by the
assets and revenues of the subdivision, such subdivision would be
deemed to be the sole issuer.  Similarly, in the case of an
industrial development bond, if that bond is backed only by the
assets and revenues of the non-governmental user, then such non-
governmental user would be deemed to be the sole issuer.  If,
however, in either case, the creating government or some other
entity guarantees a security, such a guaranty would be considered
a separate security and will be treated as an issue of such
government or other entity.

     The yields on Municipal Obligations are dependent on a
variety of factors, including general economic and monetary
conditions, money market factors, conditions in the Municipal
Obligations market, size of a particular offering, maturity of
the obligation, and rating of the issue.  The imposition of the
Fund's management fee, as well as other operating expenses,
including fees paid under the Fund's Shareholder Services Plan,
with respect to Class A, Class B and Class C shares, and the
Distribution Plan, with respect to Class B and Class C shares
only, will have the effect of reducing the yield to investors.

   
     Municipal lease obligations or installment purchase contract
obligations (collectively, "lease obligations") have special
risks not ordinarily associated with Municipal Obligations.
Although lease obligations do not constitute general obligations
of the municipality for which the municipality's taxing power is
pledged, a lease obligation ordinarily is backed by the
municipality's covenant to budget for, appropriate and make the
payments due under the lease obligation.  However, certain lease
obligations contain "non-appropriation" clauses which provide
that the municipality has no obligation to make lease or
installment purchase payments in future years unless money is
appropriated for such purpose on a yearly basis.  Although
"non-appropriation"lease obligations are secured by the leased
property, disposition of the property in the event of foreclosure
might prove difficult.  The staff of the Securities and Exchange
Commission currently considers certain lease obligations to be
illiquid.  Determination as to the liquidity of such securities
is made in accordance with guidelines established by the Fund's
Board.  Pursuant to such guidelines, the Board has directed the
Manager to monitor carefully the Fund's investment in such
securities with particular regard to (1) the frequency of trades
and quotes for the lease obligation; (2) the number of dealers
willing to purchase or sell the lease obligation and the number
of other potential buyers; (3) the willingness of dealers to
undertake to make a market in the lease obligation; (4) the
nature of the marketplace trades including the time needed to
dispose of the lease obligation, the method of soliciting offers
and the mechanics of transfer; and (5) such other factors
concerning the trading market for the lease obligation as the
Manager may deem relevant.  In addition, in evaluating the
liquidity and credit quality of a lease obligation that is
unrated, the Fund's Board has directed the Manager to consider
(a) whether the lease can be cancelled; (b) what assurance there
is that the assets represented by the lease can be sold; (c) the
strength of the lessee's general credit (its debt,
administrative, economic, and financial characteristics); (d) the
likelihood that the municipality will discontinue appropriating
funding for the leased property because the property is no longer
deemed essential to the operations of the municipality (e.g., the
potential for an "event of nonappropriation"); (e) the legal
recourse in the event of failure to appropriate; and (f) such
other factors concerning credit quality as the Manager may deem
relevant.  The Fund will not invest more than 15% of the value of
its net assets in lease obligations that are illiquid and in
other illiquid securities.  See "Investment Restriction No. 12
below. "
    

     The Fund will purchase tender option bonds only when it is
satisfied that the custodial and tender option arrangements,
including the fee payment arrangements, will not adversely affect
the tax exempt status of the underlying Municipal Obligations and
that payment of any tender fees will not have the effect of
creating taxable income for the Fund.  Based on the tender option
bond agreement, the Fund expects to be able to value the tender
option bond at par; however, the value of the instrument will be
monitored to assure that it is valued at fair value.

   
     Ratings of Municipal Obligations.  Subsequent to its
purchase by the Fund, an issue of rated Municipal Obligations may
cease to be rated or its rating may be reduced below the minimum
required for purchase by the Fund.  Neither event will require
the sale of such Municipal Obligations by the Fund, but the
Manager will consider such event in determining whether the Fund
should continue to hold the Municipal Obligations.  To the extent
that the ratings given by Moody's Investors Service, Inc.
("Moody's"), Standard & Poor's Ratings Group ("S&P"), or Fitch
IBCA, Inc. ("Fitch") for Municipal Obligations may change as a
result of changes in such organizations or their rating systems,
the Fund will attempt to use comparable ratings as standards for
its investments in accordance with its investment policies
contained in the Fund's Prospectus and this Statement of
Additional Information.  The ratings of Moody's, S&P and Fitch
represent their opinions as to the quality of the Municipal
Obligations which they undertake to rate.  It should be
emphasized, however, that ratings are relative and subjective and
are not absolute standards of quality.  Although these ratings
may be an initial criterion for selection of portfolio
investments, the Manager also will evaluate these securities and
the creditworthiness of the issuers of such securities.  See
"Appendix."
    

     Illiquid Securities.  Where a substantial market of
qualified institutional buyers develops for certain restricted
securities purchased by the Fund pursuant to Rule 144A under the
Securities Act of 1933, as amended, the Fund intends to treat
such securities as liquid securities in accordance with
procedures approved by the Fund's Board.  Because it is not
possible to predict with assurance how the market for restricted
securities pursuant to Rule 144A will develop, the Fund's Board
has directed the Manager to monitor carefully the Fund's
investments in such securities with particular regard to trading
activity, availability of reliable price information and other
relevant information.  To the extent that, for a period of time,
qualified institutional buyers cease purchasing restricted
securities pursuant to Rule 144A, the Fund's investing in such
securities may have the effect of increasing the level of
illiquidity in its portfolio during such period.

     Taxable Investments.  Securities issued or guaranteed by the
U.S. Government or its agencies or instrumentalities include U.S.
Treasury securities, which differ in their interest rates,
maturities and times of issuance.  Some obligations issued or
guaranteed by U.S. Government agencies and instrumentalities are
supported by the full faith and credit of the U.S. Treasury;
others by the right of the issuer to borrow from the U.S.
Treasury; others by discretionary authority of the U.S.
Government to purchase certain obligations of the agency or
instrumentality; and others only by the credit of the agency or
instrumentality.  These securities bear fixed, floating or
variable rates of interest.  While the U.S. Government provides
financial support to such U.S. Government sponsored agencies or
instrumentalities, no assurance can be given that it will always
do so, since it is not so obligated by law.

     Commercial paper consists of short-term, unsecured promis
sory notes issued to finance short-term credit needs.

     Certificates of deposit are negotiable certificates
representing the obligation of a bank to repay funds deposited
with it for a specified period of time.

     Time deposits are non-negotiable deposits maintained in a
banking institution for a specified period of time (in no event
longer than seven days) at a stated interest rate.  Investments
in time deposits generally are limited to London branches of
domestic banks that have total assets in excess of one billion
dollars.  Time deposits which may be held by the Fund will not
benefit from insurance from the Bank Insurance Fund or the
Savings Association Insurance Fund administered by the Federal
Deposit Insurance Corporation.

     Bankers' acceptances are credit instruments evidencing the
obligation of a bank to pay a draft drawn on it by a customer.
These instruments reflect the obligation both of the bank and of
the drawer to pay the face amount of the instrument upon
maturity.  Other short-term bank obligations may include
uninsured, direct obligations bearing fixed, floating or variable
interest rates.

     In a repurchase agreement, the Fund buys, and the seller
agrees to repurchase, a security at a mutually agreed upon time
and price (usually within seven days).  The repurchase agreement
thereby determines the yield during the purchaser's holding
period, while the seller's obligation to repurchase is secured by
the value of the underlying security.  The Fund's custodian or
subcustodian will have custody of, and will hold in a segregated
account, securities acquired by the Fund under a repurchase
agreement.  Repurchase agreements are considered by the staff of
the Securities and Exchange Commission to be loans by the Fund.
In an attempt to reduce the risk of incurring a loss on a
repurchase agreement, the Fund will enter into repurchase
agreements only with domestic banks with total assets in excess
of $1 billion, or primary government securities dealers reporting
to the Federal Reserve Bank of New York, with respect to
securities of the type in which the Fund may invest, and will
require that additional securities be deposited with it if the
value of the securities purchased should decrease below resale
price.  Repurchase agreements could involve risks in the event of
a default or insolvency of the other party to the agreement,
including possible delays or restrictions upon the Fund's ability
to dispose of the underlying securities.

Management Policies

     Short-Selling.  Until the Fund replaces the borrowed
security, it will (a) maintain a segregated account, containing
permissible liquid assets, at such a level that the amount
deposited in the account plus the amount deposited with the
broker as collateral always equals the current value of the
securities sold short; or (b) otherwise cover its short position.

     Lending Portfolio Securities.  In connection with its
securities lending transactions,  the Fund may return to the
borrower or a third party which is unaffiliated with the Fund,
and which is acting as a "placing broker," a part of the interest
earned from the investment of collateral received for securities
loaned.

     The Securities and Exchange Commission currently requires
that the following conditions must be met whenever portfolio
securities are loaned:  (1) the Fund must receive at least 100%
cash collateral from the borrower; (2) the borrower must increase
such collateral whenever the market value of the securities rises
above the level of such collateral; (3) the Fund must be able to
terminate the loan at any time; (4) the Fund must receive
reasonable interest on the loan, as well as any interest or other
distributions payable on the loaned securities, and any increase
in market value; and (5) the Fund may pay only reasonable
custodian fees in connection with the loan.

   
     Derivatives.  The Fund may invest in, or enter into,
Derivatives (as defined in the Prospectus) for a variety of
reasons, including to hedge certain market risks, to provide a
substitute for purchasing or selling particular securities or to
increase potential income gain.  Derivatives may provide a
cheaper, quicker or more specifically focused way for the Fund to
invest than "traditional" securities would.
    


     Derivatives can be volatile and involve various types and
degrees of risk, depending upon the characteristics of the
particular Derivative and the portfolio as a whole.  Derivatives
permit the Fund to increase or decrease the level of risk, or
change the character of the risk, to which its portfolio is
exposed in much the same way as the Fund can increase or decrease
the level of risk, or change the character of the risk, of its
portfolio by making investments in specific securities.

     Derivatives may be purchased on established exchanges or
through privately negotiated transactions referred to as over-the-
counter Derivatives.  Exchange-traded Derivatives generally are
guaranteed by the clearing agency which is the issuer or
counterparty to such Derivatives.  This guarantee usually is
supported by a daily payment system (i.e., variation margin
requirements) operated by the clearing agency in order to reduce
overall credit risk.  As a result, unless the clearing agency
defaults, there is relatively little counterparty credit risk
associated with Derivatives purchased on an exchange.  By
contrast, no clearing agency guarantees over-the-counter
Derivatives.  Therefore, each party to an over-the-counter
Derivative bears the risk that the counterparty will default.
Accordingly, the Manager will consider the creditworthiness of
counterparties to over-the-counter Derivatives in the same manner
as it would review the credit quality of a security to be
purchased by the Fund.  Over-the-counter Derivatives are less
liquid than exchange-traded Derivatives since the other party to
the transaction may be the only investor with sufficient
understanding of the Derivative to be interested in bidding for
it.

Futures Transactions--In General.  The Fund may enter into
futures contracts in U.S. domestic markets, such as the Chicago
Board of Trade.  Engaging in these transactions involves risk of
loss to the Fund which could adversely affect the value of the
Fund's net assets.  Although the Fund intends to purchase or sell
futures contracts only if there is an active market for such
contracts, no assurance can be given that a liquid market will
exist for any particular contract at any particular time.  Many
futures exchanges and boards of trade limit the amount of
fluctuation permitted in futures contract prices during a single
trading day.  Once the daily limit has been reached in a
particular contract, no trades may be made that day at a price
beyond that limit or trading may be suspended for specified
periods during the trading day.  Futures contract prices could
move to the limit for several consecutive trading days with
little or no trading, thereby preventing prompt liquidation of
futures positions and potentially subjecting the Fund to
substantial losses.

     Successful use of futures by the Fund also is subject to the
Manager's ability to predict correctly movements in the direction
of the relevant market, and, to the extent the transaction is
entered into for hedging purposes, to ascertain the appropriate
correlation between the transaction being hedged and the price
movements of the futures contract.  For example, if the Fund uses
futures to hedge against the possibility of a decline in the
market value of securities held in its portfolio and the prices
of such securities instead increase, the Fund will lose part or
all of the benefit of the increased value of securities which it
has hedged because it will have offsetting losses in its futures
positions.  Furthermore, if in such circumstances the Fund has
insufficient cash, it may have to sell securities to meet daily
variation margin requirements.  The Fund may have to sell such
securities at a time when it may be disadvantageous to do so.

     Pursuant to regulations and/or published positions of the
Securities and Exchange Commission, the Fund may be required to
segregate permissible liquid assets in connection with its
commodities transactions in an amount generally equal to the
value of the underlying commodity.  The segregation of such
assets will have the effect of limiting the Fund's ability
otherwise to invest those assets.

Specific Futures Transactions.  The Fund may purchase and sell
interest rate futures contracts. An interest rate future
obligates the Fund to purchase or sell an amount of a specific
debt security at a future date at a specific price.

Options--In General.  The Fund may purchase and write (i.e.,
sell) call or put options with respect to interest rate futures
contracts.  A call option gives the purchaser of the option the
right to buy, and obligates the writer to sell, the underlying
security or securities at the exercise price at any time during
the option period, or at a specific date.  Conversely, a put
option gives the purchaser of the option the right to sell, and
obligates the writer to buy, the underlying security or
securities at the exercise price at any time during the option
period, or at a specific date.

     There is no assurance that sufficient trading interest to
create a liquid secondary market on a securities exchange will
exist for any particular option or at any particular time, and
for some options no such secondary market may exist.  A liquid
secondary market in an option may cease to exist for a variety of
reasons.  In the past, for example, higher than anticipated
trading activity or order flow, or other unforeseen events, at
times have rendered certain of the clearing facilities inadequate
and resulted in the institution of special procedures, such as
trading rotations, restrictions on certain types of orders or
trading halts or suspensions in one or more options.  There can
be no assurance that similar events, or events that may otherwise
interfere with the timely execution of customers' orders, will
not recur.  In such event, it might not be possible to effect
closing transactions in particular options.

     Successful use by the Fund of options will be subject to the
Manager's ability to predict correctly movements in interest
rates.  To the extent the Manager's predictions are incorrect,
the Fund may incur losses.

     Futures Developments.  The Fund may take advantage of
opportunities in the area of options and futures contracts and
options on futures contracts and any other Derivatives which are
not presently contemplated for use by the Fund or which are not
currently available but which may be developed, to the extent
such opportunities are both consistent with the Fund's investment
objective and legally permissible for the Fund.  Before entering
into such transactions or making any such investment, the Fund
will provide appropriate disclosure in its Prospectus or
Statement of Additional Information.

     Forward Commitments.  Municipal Obligations and other
securities purchased on a forward commitment or when-issued basis
are subject to changes in value (generally changing in the same
way, i.e., appreciating when interest rates decline and
depreciating when interest rates rise) based upon the public's
perception of the creditworthiness of the issuer and changes,
real or anticipated, in the level of interest rates.  Securities
purchased on a forward commitment or when-issued basis may expose
the Fund to risks because they may experience such fluctuations
prior to their actual delivery.  Purchasing securities on a when-
issued basis can involve the additional risk that the yield
available in the market when the delivery takes place actually
may be higher than that obtained in the transaction itself.
Purchasing securities on a forward commitment or when-issued
basis when the Fund is fully or almost fully invested may result
in greater potential fluctuation in the value of the Fund's net
assets and its net asset value per share.

Investment Considerations and Risks

     Lower Rated Bonds.  The Fund is permitted to invest in
securities rated Ba by Moody's or BB by S&P and Fitch and as low
as the lowest rating assigned by Moody's, S&P or Fitch.  Such
bonds, though higher yielding, are characterized by risk.  See
"Description of the Fund--Investment Considerations and
Risks--Lower Rated Bonds" in the Prospectus for a discussion of
certain risks and "Appendix" for a general description of
Moody's, S&P and Fitch ratings of Municipal Obligations.
Although ratings may be useful in evaluating the safety of
interest and principal payments, they do not evaluate the market
value risk of these bonds.  The Fund will rely on the Manager's
judgment, analysis and experience in evaluating the
creditworthiness of an issuer.

     Investors should be aware that the market values of many of
these bonds tend to be more sensitive to economic conditions than
are higher rated securities.  These bonds generally are
considered by Moody's, S&P and Fitch to be predominantly
speculative with respect to capacity to pay interest and repay
principal in accordance with the terms of the obligation and
generally will involve more credit risk than securities in the
higher rating categories.

     Because there is no established retail secondary market for
many of these securities, the Fund anticipates that such
securities could be sold only to a limited number of dealers or
institutional investors.  To the extent a secondary trading
market for these bonds does exist, it generally is not as liquid
as the secondary market for higher rated securities.  The lack of
a liquid secondary market may have an adverse impact on market
price and yield and the Fund's ability to dispose of particular
issues when necessary to meet the Fund's liquidity needs or in
response to a specific economic event such as a deterioration in
the creditworthiness of the issuer.  The lack of a liquid
secondary market for certain securities also may make it more
difficult for the Fund to obtain accurate market quotations for
purposes of valuing the Fund's portfolio and calculating its net
asset value.  Adverse publicity and investor perceptions, whether
or not based on fundamental analysis, may decrease the values and
liquidity of these securities.  In such cases, judgment may play
a greater role in valuation because less reliable objective data
may be available.

     These bonds may be particularly susceptible to economic
downturns.  It is likely that any economic recession could
disrupt severely the market for such securities and may have an
adverse impact on the value of such securities.  In addition, it
is likely that any such economic downturn could adversely affect
the ability of the issuers of such securities to repay principal
and pay interest thereon and increase the incidence of default
for such securities.

     The Fund may acquire these bonds during an initial offering.
Such securities may involve special risks because they are new
issues.  The Fund has no arrangement with any persons concerning
the acquisition of such securities, and the Manager will review
carefully the credit and other characteristics pertinent to such
new issues.

     The credit risk factors pertaining to lower rated securities
also apply to lower rated zero coupon bonds and pay-in-kind
bonds, in which the Fund may invest up to 5% of its net assets.
Zero coupon securities and pay-in-kind or delayed interest bonds
carry an additional risk in that, unlike bonds which pay interest
throughout the period to maturity, the Fund will realize no cash
until the cash payment date unless a portion of such securities
are sold and, if the issuer defaults, the Fund may obtain no
return at all on its investment.  See "Dividends, Distributions
and Taxes."

Investment Restrictions

     The Fund has adopted investment restrictions numbered 1
through 10 as fundamental policies, which cannot be changed
without approval by the holders of a majority (as defined in the
"1940 Act") of the Fund's outstanding voting shares.  Investment
restrictions numbered 11 and 12 are not fundamental policies and
may be changed by vote of a majority of the Fund's Board members
at any time.  The Fund may not:

     1.        Purchase securities other than Municipal Obligations
and Taxable Investments as those terms are defined above and in
the Prospectus and those arising out of transactions in futures
and options.

     2.        Borrow money, except to the extent permitted under the
1940 Act (which currently limits borrowing to no more than 33-
1/3% of the value of the Fund's total assets).  Transactions in
futures and options and the entry into short sales transactions
do not involve any borrowing for purposes of this restriction.

     3.        Purchase securities on margin, but the Fund may make
margin deposits in connection with transactions in futures,
including those related to indices, and options on futures or
indices.

     4.        Underwrite the securities of other issuers, except that
the Fund may bid separately or as part of a group for the
purchase of Municipal Obligations directly from an issuer for its
own portfolio to take advantage of the lower purchase price
available, and except to the extent the Fund may be deemed an
underwriter under the Securities Act of 1933, as amended, by
virtue of disposing of portfolio securities.

     5.        Purchase or sell real estate, real estate investment
trust securities, commodities or commodity contracts, or oil and
gas interests, but this shall not prevent the Fund from investing
in Municipal Obligations secured by real estate or interests
therein or prevent the Fund from purchasing and selling futures
contracts, including those related to indices, and options on
futures contracts or indices.

     6.        Make loans to others except through the purchase of
qualified debt obligations and the entry into repurchase
agreements referred to above and in the Fund's Prospectus;
however, the Fund may lend its portfolio securities in an amount
not to exceed 33-1/3% of the value of its total assets.  Any
loans of portfolio securities will be made according to
guidelines established by the Securities and Exchange Commission
and the Fund's Board members.

     7.        Invest more than 15% of its assets in the obligations
of any one bank for temporary defensive purposes, or invest more
than 5% of its assets in the obligations of any other issuer,
except that up to 25% of the value of the Fund's total assets may
be invested, and securities issued or guaranteed by the U.S.
Government or its agencies or instrumentalities may be purchased,
without regard to any such limitations.  Notwithstanding the
foregoing, to the extent required by the rules of the Securities
and Exchange Commission, the Fund will not invest more than 5% of
its assets in the obligations of any one bank, except that up to
25% of the value of the Fund's total assets may be invested
without regard to such limitation.

     8.        Invest more than 25% of its total assets in the securi
ties of issuers in any single industry; provided that there shall
be no such limitation on the purchase of Municipal Obligations
and, for temporary defensive purposes, obligations issued or
guaranteed by the U.S. Government, its agencies or instrumen
talities.

     9.        Invest in companies for the purpose of exercising con
trol.

     10.       Invest in securities of other investment companies, ex
cept as they may be acquired as part of a merger, consolidation
or acquisition of assets.

     11.       Pledge, hypothecate, mortgage or otherwise encumber its
assets, except to the extent necessary to secure permitted
borrowings.  The deposit of assets in escrow in connection with
the writing of covered put and call options and the purchase of
securities on a when-issued or delayed-delivery basis and
collateral arrangements with respect to initial or variation
margin for futures contracts and options on futures contracts or
indices will not be deemed to be pledges of the Fund's assets.

     12.        Enter into repurchase agreements providing for
settlement in more than seven days after notice or purchase
securities which are illiquid (which securities could include
participation interests that are not subject to the demand
feature described in the Fund's Prospectus and floating and
variable rate demand obligations as to which no secondary market
exists and the Fund cannot exercise the demand feature described
in the Fund's Prospectus on less than seven days' notice), if, in
the aggregate, more than 15% of the value of its net assets would
be so invested.

     For purposes of Investment Restriction No. 8, industrial
development bonds, where the payment of principal and interest is
the ultimate responsibility of companies within the same
industry, are grouped together as an "industry."

     If a percentage restriction is adhered to at the time of
investment, a later increase in percentage resulting from a
change in values or assets will not constitute a violation of
such restriction.

     The Fund may make commitments more restrictive than the
restrictions listed above so as to permit the sale of Fund shares
in certain states.  Should the Fund determine that a commitment
is no longer in the best interests of the Fund and its
shareholders, the Fund reserves the right to revoke the
commitment by terminating the sale of Fund shares in the state
involved.


                     MANAGEMENT OF THE FUND

     Board members and officers of the Fund, together with
information as to their principal business occupations during at
least the last five years, are shown below.

Board Members of the Fund

   
CLIFFORD L. ALEXANDER, JR., Board Member.  President of Alexander
     & Associates, Inc., a management consulting firm.  From 1977
     to 1981, Mr. Alexander served as Secretary of the Army and
     Chairman of the Board of the Panama Canal Company, and from
     1975 to 1977, he was a member of the Washington, D.C. law
     firm of Verner, Liipfert, Bernhard, McPherson and Alexander.
     He is a director of American Home Products Corporation,
     Cognizant Corporation, a service provider of marketing
     information and information technology, The Dun & Bradstreet
     Corporation, MCI Communications Corporation, Mutual of
     America Life Insurance Company and TLC Beatrice
     International Holdings, Inc.  He is 64 years old and his
     address is 400 C Street, N.E., Washington, D.C. 20002.
    
   
PEGGY C. DAVIS, Board Member.  Shad Professor of Law, New York
     University School of Law.  Professor Davis has been a member
     of the New York University law faculty since      1983.
     Prior to that time, she served for three years as a judge in
     the courts of New York State; was engaged for eight years in
     the practice of law, working in both corporate and
     non-profit sectors; and served for two years as a criminal
     justice administrator in the government of the City of New
     York.  She writes and teaches in the fields of evidence,
     constitutional theory, family law, social sciences and the
     law, legal process and professional methodology and
     training.  She is 55 years old and her address is c/o New
     York University School of Law, 40 Washington Square South,
     New York, New York 10011.
    
   
JOSEPH S. DiMARTINO, Chairman of the Board.  Since January 1995,
     Chairman of the Board of various funds in the Dreyfus Family
     of Funds.  He is also a director of Noel Group, Inc., a
     venture capital company (for which, from February 1995 until
     November 1997, he was Chairman of the Board), The Muscular
     Dystrophy Association, HealthPlan Services Corporation, a
     provider of marketing, administrative and risk management
     services to health and other benefit programs, Carlyle
     Industries, Inc. (formerly, Belding Heminway Company, Inc.),
     a button packager and distributor, Century Business
     Services, Inc., a provider of various outsourcing functions
     for small and medium sized companies, and Career Blazers
     Inc. (formerly, Staffing Resources), a temporary placement
     firm.  For more than five years prior to January 1995, he
     was President, a director and, until August 1994, Chief
     Operating Officer of the Manager and Executive Vice
     President and a director of Dreyfus Service Corporation, a
     wholly-owned subsidiary of the Manager and, until August 24,
     1994, the Fund's distributor.  From August 1994 to December
     31, 1994, he was a director of Mellon Bank Corporation.  He
     is 54 years old and his address is 200 Park Avenue, New
     York, New York 10166.
    
   
ERNEST KAFKA, Board Member.  A physician engaged in private
     practice specializing in the psychoanalysis of adults and
     adolescents.  Since 1981, he has served as an Instructor at
     the New York Psychoanalytic Institute and, prior thereto,
     held other teaching positions.  He is Associate Clinical
     Professor of Psychiatry at Cornell Medical School.  For more
     than the past five years, Dr. Kafka has held numerous
     administrative positions, including President of The New
     York Psychoanalytic Society, and has published many articles
     on subjects in the field of psychoanalysis.  He is 65 years
     old and his address is 23 East 92nd Street, New York, New
     York 10128.
    
   
SAUL B. KLAMAN, Board Member.  Chairman and Chief Executive
     Officer of SBK Associates, which provides research and
     consulting services to financial institutions.  Dr. Klaman
     was President of the National Association of Mutual Savings
     Banks until November 1983, President of the National Council
     of Savings Institutions until June 1985, Vice Chairman of
     Golembe Associates and BEI Golembe, Inc. until 1989 and
     Chairman Emeritus of BEI Golembe, Inc. until November, 1992.
     He also served as an Economist to the Board of Governors of
     the Federal Reserve System and on several Presidential
     Commissions and has held numerous consulting and advisory
     positions in the fields of economics and housing finance.
     He is 78 years old and his address is 431-B Dedham Street,
     The Gables, Newton Center, Massachusetts 02159.
    
   
NATHAN LEVENTHAL, Board Member.  President of Lincoln Center for
     the Performing Arts, Inc.  Mr. Leventhal was Deputy Mayor
     for Operations of New York City from September 1979 to March
     1984 and Commissioner of the Department of Housing
     Preservation and Development of New York City from February
     1978 to September 1979.  Mr. Leventhal was an associate and
     then a member of the New York law firm of Poletti Freidin
     Prashker Feldman and Gartner from 1974 to 1978. He was
     Commissioner of Rent and Housing Maintenance for New York
     City from 1972 to 1973.  Mr. Leventhal served as Chairman of
     Citizens Union, an organization which strives to reform and
     modernize city and state government from June 1994 until
     June 1997.  He is 55 years old and his address is 70 Lincoln
     Center Plaza, New York, New York 10023-6583.
    
     For so long as the Fund's plans described in the section
captioned "Distribution Plan and Shareholder Services Plan"
remain in effect, the Board members of the Fund who are not
"interested persons" of the Fund, as defined in the 1940 Act,
will be selected and nominated by the Board members who are not
"interested persons" of the Fund.

     There ordinarily will be no meeting of shareholders for the
purpose of electing Board members unless and until such time as
less than a majority of the Board members holding office have
been elected by shareholders, at which time the Board members
then in office will call a shareholders' meeting for the election
of Board members.  Under the 1940 Act, shareholders of record of
not less than two-thirds of the outstanding shares of the Fund
may remove a Board member through a declaration in writing or by
vote cast in person or by proxy at a meeting called for that
purpose.  The Board members are required to call a meeting of
shareholders for the purpose of voting upon the question of
removal of any such Board member when requested in writing to do
so by the shareholders of record of not less than 10% of the
Fund's outstanding shares.

   
     The Fund typically pays its Board members an annual retainer
and a per meeting fee and reimburses them for their expenses.
The Chairman of the Board receives an additional 25% of such
compensation.  Emeritus Board members are entitled to receive an
annual retainer and a per meeting fee of one-half the amount paid
to them as Board members.  The aggregate amount of compensation
paid to each Board member by the Fund for the fiscal year ended
April 30, 1998, and by all other funds in the Dreyfus Family of
Funds for which such person is a Board member (the number of
which is set forth in, parenthesis next to each Board member's
total compensation) for the year ended December 31, 1997, were as
follows:
    
   

                                                         Total
                                                  Compensation from
                               Aggregate             Fund and Fund
Name of Board             Compensation from         Complex Paid to
  Member                          Fund*               Board Member

Clifford L. Alexander, Jr.      $5,500               $ 88,305 (17)

Peggy C. Davis                  $6,000               $ 78,750 (15)

Joseph S. DiMartino             $7,500               $597,128 (93)

Ernest Kafka                    $5,500               $ 77,500 (15)

Saul B. Klaman                  $6,000               $ 78,750 (15)

Nathan Leventhal                $6,000               $ 78,750 (15)

* Amount does not include reimbursed expenses for attending
  Board meetings, which amounted to $1,389 all Board members as
  a group.
    
   
Officers of the Fund

MARIE E. CONNOLLY, President and Treasurer.  President, Chief
     Executive Officer, Chief Compliance Officer and a director
     of the Distributor and Funds Distributor, Inc., the ultimate
     parent of which is Boston Institutional Group, Inc., and an
     officer of other investment companies advised or
     administered by the Manager.  She is 41 years old.

MARGARET W. CHAMBERS, Vice President and Secretary.  Senior Vice
     President and General Counsel of Funds Distributor, Inc.,
     and an officer of other investment companies advised or
     administered by the Manager.  From August 1996 to March
     1998, she was Vice President and Assistant General Counsel
     for Loomis, Sayles & Company, L.P.  From January 1986 to
     July 1996, she was an associate with the law firm of Ropes &
     Gray.  She is 38 years old.

MICHAEL  S.  PETRUCELLI, Vice President, Assistant Treasurer  and
     Assistant   Secretary.  Senior  Vice  President   of   Funds
     Distributor,  Inc.,  and  an  officer  of  other  investment
     companies  advised  or administered by  the  Manager.   From
     December 1989 through November 1996, he was employed  by  GE
     Investments  where  he  held  various  financial,   business
     development  and compliance positions.  He  also  served  as
     Treasurer of the GE Funds and as a Director of GE Investment
     Services.  He is 37 years old.

STEPHANIE D. PIERCE, Vice President, Assistant Treasurer and
     Assistant Secretary. Vice President and Client Development
     Manager of Funds Distributor, Inc., and an officer of other
     investment companies advised or administered by the Manager.
     From April 1997 to March 1998, she was employed as a
     Relationship Manager with Citibank, N.A.  She is 29 years
     old.

MARY A. NELSON,  Vice President and Assistant Treasurer.  Vice
     President of the Distributor and Funds Distributor, Inc.,
     and an officer of other investment companies advised or
     administered by the Manager.  From September 1989 to July
     1994, she was an Assistant Vice President and Client Manager
     for The Boston Company, Inc.  She is 34 years old.

GEORGE A. RIO, Vice President and Assistant Treasurer.  Executive
     Vice President and Client Service Director of Funds
     Distributor Inc., and an officer of other investment
     companies advised or administered by the Manager.  From June
     1995 to March 1998, he was Senior Vice President and Senior
     Key Account Manager for Putnam Mutual Funds.  From May 1994
     to June 1995, he was Director of Business Development for
     First Data Corporation.  From September 1983 to May 1994, he
     was Senior Vice President and Manager of Client Services and
     Director of Internal Audit at The Boston Company, Inc..  He
     is 43 years old.

JOSEPH F. TOWER, III, Vice President and Assistant Treasurer.
     Senior Vice President, Treasurer, Chief Financial Officer
     and a director of the Distributor and Funds Distributor,
     Inc., and an officer of other investment companies advised
     or administered by the Manager.  From July 1988 to August
     1994, he was employed by The Boston Company, Inc. where he
     held various management positions in the Corporate Finance
     and Treasury areas.  He is 35 years old.

DOUGLAS C. CONROY, Vice President and Assistant Secretary.
     Assistant Vice President of Funds Distributor, Inc., and an
     officer of other investment companies advised or
     administered by the Manager.  From April 1993 to January
     1995, he was a Senior Fund Accountant for Investors Bank &
     Trust Company.  From December 1991 to March 1993, he was
     employed as a Fund Accountant at The Boston Company, Inc.
     He is 29 years old.

CHRISTOPHER J. KELLEY, Vice President and Assistant Secretary.
     Vice President and Senior Associate General Counsel of Funds
     Distributor, Inc., and an officer of other investment
     companies advised or administered by the Manager.  From
     April 1994 to July 1996, he was Assistant Counsel at Forum
     Financial Group.  From October 1992 to March 1994, he was
     employed by Putnam Investments in legal and compliance
     capacities.  He is 33 years old.

KATHLEEN K. MORRISEY, Vice President and Assistant Secretary.
     Manager of Treasury Services Administration of Funds
     Distributor, Inc., and an officer of other investment
     companies advised or administered by the Manager.  From July
     1994 to November 1995, she was a Fund Accountant for
     Investors Bank & Trust Company.  She is 25 years old.

ELBA VASQUEZ, Vice President and Assistant Secretary.  Assistant
     Vice President of Funds Distributor, Inc., and an officer of
     other investment companies advised or administered by the
     Manager.  From March 1990 to May 1996, she was employed by
     the U.S. Trust Company of New York, where she held various
     sales and marketing positions.  She is 36 years old.
    

     The address of each officer of the Fund is 200 Park Avenue,
New York, New York 10166.

   
     The Fund's Board members and officers, as a group, owned
less than 1% of the Fund's shares outstanding on August 13, 1998.
    
   
     The following entities held of record 5% or more of the
Fund's shares outstanding on August 13, 1998:  Class B - Merrill
Lynch, Pierce Fenner & Smith, Jacksonville, FL - 10.37%; Class C
- - Merrill Lynch, Pierce Fenner & Smith, Jacksonville, FL -
55.22%; Leslie C. DiMartino, Southport, CT - 6.97%.  A
shareholder who beneficially owns, directly or indirectly, 25% or
more of the Fund's voting securities may be deemed to be a
"control person" (as defined in the 1940 Act) of the Fund.
    


                      MANAGEMENT AGREEMENT

     The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled
"Management of the Fund."

   
     The Manager provides management services pursuant to the
Management Agreement (the "Agreement") dated August 24, 1994 with
the Fund, which is subject to annual approval by (i) the Fund's
Board or (ii) vote of a majority (as defined in the 1940 Act) of
the outstanding voting securities of the Fund, provided that in
either event the continuance also is approved by a majority of
the Board members who are not "interested persons" (as defined in
the 1940 Act) of the Fund or the Manager, by vote cast in person
at a meeting called for the purpose of voting on such approval.
The Agreement was approved by shareholders on August 3, 1994 and
was last approved by the Fund's Board, including a majority of
the Board members who are not "interested persons" of any party
to the Agreement, at a meeting held on July 15, 1998.  The
Agreement is terminable without penalty, on 60 days' notice, by
the Fund's Board or by vote of the holders of a majority of the
Fund's outstanding shares, or, on not less than 90 days' notice,
by the Manager.  The Agreement will terminate automatically in
the event of its assignment (as defined in the 1940 Act).
    
   
     The following persons are officers and/or directors of the
Manager:  W. Keith Smith, Chairman of the Board; Christopher M.
Condron, President, Chief Executive Officer, Chief Operating
Officer and a director; Stephen E. Canter, Vice Chairman, Chief
Investment Officer and a director; Lawrence S. Kash, Vice
Chairman-Distribution and a director;  J. David Officer, Vice
Chairman and a director; Ronald P. O'Hanley III, Vice Chairman;
William T. Sandalls, Jr., Senior Vice President and Chief
Financial Officer; Mark N. Jacobs, Vice President, General
Counsel and Secretary; Patrice M. Kozlowski, Vice President-
Corporate Communications; Mary Beth Leibig, Vice President-Human
Resources; Andrew S. Wasser, Vice President-Information Systems;
James Bitetto, Assistant Secretary; Steve F. Newman, Assistant
Secretary; and Mandell L. Berman, Burton C. Borgelt, Frank V.
Cahouet and Richard F. Syron, directors.
    

     The Manager manages the Fund's portfolio of investments in
accordance with the stated policies of the Fund, subject to the
approval of the Fund's Board.  The Manager is responsible for
investment decisions, and provides the Fund with portfolio
managers who are authorized by the Fund's Board to execute
purchases and sales of securities.  The Fund's portfolio managers
are Joseph P. Darcy, A. Paul Disdier, Douglas J. Gaylor, Karen M.
Hand, Stephen C. Kris, Richard J. Moynihan, W. Michael Petty,
Jill C. Shaffro, Samuel J. Weinstock and Monica S. Wieboldt.  The
Manager also maintains a research department with a professional
staff of portfolio managers and securities analysts who provide
research services for the Fund and for other funds advised by the
Manager.

     The Manager maintains office facilities on behalf of the
Fund, and furnishes statistical and research data, clerical help,
accounting, data processing, bookkeeping and internal auditing
and certain other required services to the Fund.  The Manager
also may make such advertising and promotional expenditures,
using its own resources, as it from time to time deems
appropriate.

     All expenses incurred in the operation of the Fund are borne
by the Fund, except to the extent specifically assumed by the
Manager.  The expenses borne by the Fund include, without
limitation, the following:  taxes, interest, loan commitment
fees, interest and distributions paid on securities sold short,
brokerage fees and commissions, if any, fees of Board members who
are not officers, directors, employees or holders of 5% or more
of the outstanding voting securities of the Manager, Securities
and Exchange Commission fees and state Blue Sky qualification
fees, advisory fees, charges of custodians, transfer and dividend
disbursing agents' fees, certain insurance premiums, industry
association fees, outside auditing and legal expenses, costs of
independent pricing services, costs of maintaining the Fund's
existence, costs attributable to investor services (including,
without limitation, telephone and personnel expenses), costs of
preparing and printing prospectuses and statements of additional
information for regulatory purposes and for distribution to
existing shareholders, costs of shareholders' reports and
meetings, and any extraordinary expenses.  In addition, shares of
each Class are subject to an annual service fee and Class B and
Class C shares are subject to an annual distribution fee.  See
"Distribution Plan and Shareholder Services Plan."

   
     As compensation for the Manager's services, the Fund has
agreed to pay the Manager a monthly management fee at the annual
rate of .55 of 1% of the value of the Fund's average daily net
assets.  For the fiscal years ended April 30, 1996, 1997 and
1998, the management fees paid by the Fund amounted to
$3,302,301, $3,180,718 and $3,155,724, respectively.
    


     The Manager has agreed that if in any fiscal year the
aggregate expenses of the Fund, exclusive of taxes, brokerage,
interest on borrowings and (with the prior written consent of the
necessary state securities commissions) extraordinary expenses,
but including the management fee, exceed the expense limitation
of any state having jurisdiction over the Fund, the Fund may
deduct from the payment to be made to the Manager under the
Agreement, or the Manager will bear, such excess expense to the
extent required by state law.  Such deduction or payment, if any,
will be estimated daily, and reconciled and effected or paid, as
the case may be, on a monthly basis.

     The aggregate of the fees payable to the Manager is not
subject to reduction as the value of the Fund's net assets
increases.


                       PURCHASE OF SHARES

     The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled
"How to Buy Shares."

     The Distributor.  The Distributor serves as the Fund's
distributor on a best efforts basis pursuant to an agreement
dated August 24, 1994.  The Distributor also acts as distributor
for the other funds in the Dreyfus Premier Family of Funds, for
the funds in the Dreyfus Family of Funds and for certain other
investment companies.

   
     For fiscal years ended April 30, 1997 and 1998, the
Distributor retained $32,137 and $33,805, respectively, from
sales loads on Class A shares; $248,884 and $177,747,
respectively, from contingent deferred sales charges ("CDSCs") on
Class B shares; and $6,468 and $294, respectively, from CDSCs on
Class C shares.  For the fiscal year ended April 30, 1996, the
Distributor retained $42,724 from sales loads on Class A shares
and $207,759 from CDSCs on Class B shares.  For the period from
July 13, 1995 (commencement of initial offering of Class C
shares) to April 30, 1996, the Distributor retained $101 from
CDSCs on Class C shares.
    


     Sales Loads -- Class A.  The scale of sales loads applies to
purchases of Class A shares made by any "purchaser," which term
includes an individual and/or spouse purchasing securities for
his, her or their own account or for the account of any minor
children, or a trustee or other fiduciary purchasing securities
for a single trust estate or a single fiduciary account
(including a pension, profit-sharing or other employee benefit
trust created pursuant to a plan qualified under Section 401 of
the Internal Revenue Code of 1986, as amended (the "Code"))
although more than one beneficiary is involved; or a group of
accounts established by or on behalf of the employees of an
employer or affiliated employers pursuant to an employee benefit
plan or other program (including accounts established pursuant to
Sections 403(b), 408(k) and 457 of the Code); or an organized
group which has been in existence for more than six months,
provided that it is not organized for the purpose of buying
redeemable securities of a registered investment company and
provided that the purchases are made through a central
administration or a single dealer, or by other means which result
in economy of sales effort or expense.
   
     Set forth below is an example of the method of computing the
offering price of the Fund's Class A shares.  The example assumes
a purchase of Class A shares of the Fund aggregating less than
$50,000 subject to the schedule of sales charges set forth in the
Fund's Prospectus at a price based upon the net asset value of
the Class A shares on April 30, 1998:
    
   

     Net Asset Value per share                 $14.69

     Per Shares Sales Charge - 4.5% of offering price
       (4.7% of net asset value per share)    $   .69

     Per Share Offering Price to Public        $15.38
    

     Using Federal Funds.  Dreyfus Transfer, Inc., the Fund's
transfer and dividend disbursing agent (the "Transfer Agent"), or
the Fund may attempt to notify the investor upon receipt of
checks drawn on banks that are not members of the Federal Reserve
System as to the possible delay in conversion into Federal Funds
and may attempt to arrange for a better means of transmitting the
money.  If the investor is a customer of a securities  dealer
("Selected Dealer") and his order to purchase Fund shares is paid
for other than in Federal Funds, the Selected Dealer, acting on
behalf of its customer, will complete the conversion into, or
itself advance, Federal Funds generally on the business day
following  receipt of the customer's order.  The order is
effective only when so converted and received by the Transfer
Agent.  An order for the purchase of Fund shares placed by an
investor with sufficient Federal Funds or a cash balance in his
brokerage account with a Selected Dealer will become effective on
the day that the order, including Federal Funds, is received by
the Transfer Agent.

     TeleTransfer Privilege.  TeleTransfer purchase orders may be
made at any time.  Purchase orders received by 4:00 p.m., New
York time, on any business day the Transfer Agent and the New
York Stock Exchange are open for business will be credited to the
shareholder's Fund account on the next bank business day
following such purchase order.  Purchase orders made after 4:00
p.m., New York time, on any business day the Transfer Agent and
the New York Stock Exchange are open for business, or orders made
on Saturday, Sunday or any Fund Holiday (e.g., when the New York
Stock Exchange is not open for business), will be credited to the
shareholder's Fund account on the second bank business day
following such purchase order.  To qualify to use the
TeleTransfer Privilege, the initial payment for purchase of Fund
shares must be drawn on, and redemption proceeds paid to, the
same bank and account as are designated on the Account
Application or Shareholder Services Form on file.  If the
proceeds of a particular redemption are to be wired to an account
at any other bank, the request must be in writing and signature
guaranteed.  See "Redemption of Shares--TeleTransfer Privilege."

     Reopening an Account.  An investor may reopen an account
with a minimum investment of $100 without filing a new Account
Application during the calendar year the account is closed or
during the following calendar year, provided the information on
the old Account Application is still applicable.


        DISTRIBUTION PLAN AND SHAREHOLDER SERVICES PLAN

     The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled
"Distribution Plan and Shareholder Services Plan."

     Class B and Class C shares are subject to a Distribution
Plan and Class A, Class B and Class C shares are subject to a
Shareholder Services Plan.

     Distribution Plan.  Rule 12b-1 (the "Rule"), adopted by the
Securities and Exchange Commission under the 1940 Act, provides,
among other things, that an investment company may bear expenses
of distributing its shares only pursuant to a plan adopted in
accordance with the Rule.  The Fund's Board has adopted such a
plan (the "Distribution Plan") with respect to Class B and Class
C shares pursuant to which the Fund pays the Distributor for
distributing Class B and Class C shares.  The Fund's Board
believes that there is a reasonable likelihood that the
Distribution Plan will benefit the Fund and holders of Class B
and Class C shares.

   
     A quarterly report of the amounts expended under the
Distribution Plan, and the purposes for which such expenditures
were incurred, must be made to the Board for its review.  In
addition, the Distribution Plan provides that it may not be
amended to increase materially the costs which holders of Class B
or Class C shares may bear for distribution pursuant to the
Distribution Plan without the approval of such shareholders and
that other material amendments of the Distribution Plan must be
approved by the Board, and by the Board members who are not
"interested persons" (as defined in the 1940 Act) of the Fund or
the Manager and have no direct or indirect financial interest in
the operation of the Distribution Plan, or in any agreements
entered into in connection with the Distribution Plan, by vote
cast in person at a meeting called for the purpose of considering
such amendments.  The Distribution Plan is subject to annual
approval by such vote of the Board members cast in person at a
meeting called for the purpose of voting on the Distribution
Plan.  The Distribution Plan was last so approved at a meeting
held on July 15, 1998.  As to each such Class, the Distribution
Plan may be terminated at any time by vote of a majority of the
Board members who are not "interested persons" and have no direct
or indirect financial interest in the operation of the
Distribution Plan or by vote of the holders of a majority of such
Class.
    
   
     For the fiscal year ended April 30, 1998, the Fund paid the
Distributor $582,174 with respect to Class B, and $15,391 with
respect to Class C, under the Distribution Plan.
    


     Shareholder Services Plan.  The Fund has adopted a
Shareholder Services Plan, pursuant to which the Fund pays the
Distributor for the provision of certain services to the holders
of Class A, Class B and Class C shares.  The services provided
may include personal services relating to shareholder accounts,
such as answering shareholder inquiries regarding the Fund and
providing reports and other information, and services related to
the maintenance of such shareholder accounts.  Under the
Shareholder Services Plan, the Distributor may make payments to
certain financial institutions (which may include banks),
Selected Dealers and other financial industry professionals
(collectively, "Service Agents") in respect of these services.

   
     A quarterly report of the amounts expended under the
Shareholder Services Plan, and the purposes for which such
expenditures were incurred, must be made to the Board for its
review.  In addition, the Shareholder Services Plan provides that
material amendments must be approved by the Fund's Board, and by
the Board members who are not "interested persons" (as defined in
the 1940 Act) of the Fund and have no direct or indirect
financial interest in the operation of the Shareholder Services
Plan, by vote cast in person at a meeting called for the purpose
of considering such amendments.  The Shareholder Services Plan is
subject to annual approval by such vote of the Board members cast
in person at a meeting called for the purpose of voting on the
Shareholder Services Plan.  The Shareholder Services Plan was
last so approved on July 15, 1998.  As to each Class of shares,
the Shareholder Services Plan is terminable at any time by vote
of a majority of the Board members who are not "interested
persons" and who have no direct or indirect financial interest in
the operation of the Shareholder Services Plan, or in any
agreements entered into in connection with the Shareholder
Services Plan.
    
   
     For the fiscal year ended April 30, 1998, the Fund paid the
Distributor $1,138,203 with respect to Class A, $291,087 with
respect to Class B, and $5,130 with respect to Class C, under the
Shareholder Services Plan.
    



                      REDEMPTION OF SHARES

     The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled
"How to Redeem Shares."

   
     Check Redemption Privilege--Class A Shares.  The Fund
provides Redemption Checks ("Checks") to investors in Class A
shares automatically upon opening an account, unless such
investors specifically refuse the Check Redemption Privilege by
checking the applicable "No" box on the Account Application.
Checks will be sent only to the registered owner(s) of the
account and only to the address of record.  The Check Redemption
Privilege may be established for an existing account by a
separate signed Shareholder Services Form.  The
Account Application or Shareholder Services Form must be manually
signed by the registered owner(s).  Checks are drawn on the
investor's Fund account and may be made payable to the order of
any person in an amount of $500 or more.  When a Check is
presented to the Transfer Agent for payment, the Transfer Agent,
as the investor's agent, will cause the Fund to redeem a
sufficient number of full and fractional Class A shares in the
investor's account to cover the amount of the Check.  Dividends
are earned until the Check clears.  After clearance, a copy of
the Check will be returned to the investor.  Investors generally
will be subject to the same rules and regulations that apply to
checking accounts, although election of this Privilege creates
only a shareholder-transfer agent relationship with the Transfer
Agent.
    

     If the amount of the Check is greater than the value of the
Class A shares in an investor's account, the Check will be
returned marked insufficient funds.  Checks should not be used to
close an account.

     TeleTransfer Privilege.  Investors should be aware that if
they have selected the TeleTransfer Privilege, any request for a
TeleTransfer transaction will be effected through the Automated
Clearing House ("ACH") system unless more prompt transmittal
specifically is requested.  Redemption proceeds will be on
deposit in the investor's account at an ACH member bank
ordinarily two business days after receipt of the redemption
request.  See "Purchase of Shares--TeleTransfer Privilege."

     Share Certificates; Signatures.  Any certificates represent
ing Fund shares to be redeemed must be submitted with the redemp
tion request.  Written redemption requests must be signed by each
shareholder, including each owner of a joint account, and each
signature must be guaranteed.  Signatures on endorsed
certificates submitted for redemption also must be guaranteed.
The Transfer Agent has adopted standards and procedures pursuant
to which signature-guarantees in proper form generally will be
accepted from domestic banks, brokers, dealers, credit unions,
national securities exchanges, registered securities
associations, clearing agencies and savings associations, as well
as from participants in the New York Stock Exchange Medallion
Signature Program, the Securities Transfer Agents Medallion
Program ("STAMP") and the Stock Exchanges Medallion Program.
Guarantees must be signed by an authorized signatory of the
guarantor and "Signature-Guaranteed" must appear with the
signature.  The Transfer Agent may request additional
documentation from corporations, executors, administrators,
trustees or guardians, and may accept other suitable verification
arrangements from foreign investors, such as consular
verification.

     Redemption Commitment.  The Fund has committed itself to pay
in cash all redemption requests by any shareholder of record,
limited in amount during any 90-day period to the lesser of
$250,000 or 1% of the value of the Fund's net assets at the
beginning of such period.  Such commitment is irrevocable without
the prior approval of the Securities and Exchange Commission.  In
the case of requests for redemption in excess of such amount, the
Fund's Board reserves the right to make payments in whole or in
part in securities or other assets in case of an emergency or any
time a cash distribution would impair the liquidity of the Fund
to the detriment of the existing shareholders.  In such event,
the securities would be valued in the same manner as the Fund's
portfolio is valued.  If the recipient sold such securities,
brokerage charges might be incurred.

     Suspension of Redemption.  The right of redemption may be
suspended or the date of payment postponed (a) during any period
when the New York Stock Exchange is closed (other than customary
weekend and holiday closings), (b) when trading in the markets
the Fund ordinarily utilizes is restricted, or when an emergency
exists as determined by the Securities and Exchange Commission so
that disposal of the Fund's investments or determination of its
net asset value is not reasonably practicable, or (c) for such
other periods as the Securities and Exchange Commission by order
may permit to protect the Fund's shareholders.


                      SHAREHOLDER SERVICES

     The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled
"Shareholder Services."

     Fund Exchanges.  Class A, Class B and Class C shares of the
Fund may be exchanged for shares of the respective Class of
certain other funds advised or administered by the Manager.
Shares of the same Class of such other funds purchased by
exchange will be purchased on the basis of relative net asset
value per share as follows:

  A.   Class A shares of funds purchased without a sales load may
     be exchanged for Class A shares of other funds sold with a sales
     load, and the applicable sales load will be deducted.

  B.   Class A shares of funds purchased with or without a sales
     load may be exchanged without a sales load for Class A shares of
     other funds sold without a sales load.

  C.   Class A shares of funds purchased with a sales load, Class A
     shares of funds acquired by a previous exchange from Class A
     shares purchased with a sales load, and additional Class A shares
     acquired through reinvestment of dividends or distributions of
     any such funds (collectively referred to herein as "Purchased
     Shares") may be exchanged for Class A shares of other funds sold
     with a sales load (referred to herein as "Offered Shares"),
     provided that, if the sales load applicable to the Offered Shares
     exceeds the maximum sales load that could have been imposed in
     connection with the Purchased Shares (at the time the Purchased
     Shares were acquired), without giving effect to any reduced
     loads, the difference will be deducted.

  D.   Class B or Class C shares of any fund may be exchanged for
     the same Class of shares of other funds without a sales load.
     Class B or Class C shares of any fund exchanged for the same
     Class of shares of another fund will be subject to the higher
     applicable CDSC of the two exchanged funds and, for purposes of
     calculating CDSC rates and conversion periods, will be deemed to
     have been held since the date the Class B or Class C shares being
     exchanged were initially purchased.


     To accomplish an exchange under item C above, an investor's
Service Agent must notify the Transfer Agent of the investor's
prior ownership of such Class A shares and the investor's account
number.

     To request an exchange, the investor's Service Agent acting
on the investor's behalf must give exchange instructions to the
Transfer Agent in writing or by telephone.  The ability to issue
exchange instructions by telephone is given to all Fund
shareholders automatically unless the investor checks the
applicable "No" box on the Account Application, indicating that
the investor specifically refuses this privilege.  By using the
Telephone Exchange Privilege, the investor authorizes the
Transfer Agent to act on telephonic instructions (including over
The Dreyfus Touchr automated telephone system) from any person
representing himself or herself to be the investor or a
representative of the investor's Service Agent, and reasonably
believed by the Transfer Agent to be genuine.  Telephone
exchanges may be subject to limitations as to the amount involved
or the number of telephone exchanges permitted.  Shares issued in
certificate form are not eligible for telephone exchange.

     To establish a personal retirement plan by exchange, shares
of the fund being exchanged must have a value of at least the
minimum initial investment being required for the shares of the
same Class of the fund into which the exchange is being made.

     Auto-Exchange Privilege.  The Auto-Exchange Privilege
permits an investor to purchase, in exchange for Class A, Class B
or Class C shares of the Fund, shares of the same Class of
another fund in the Dreyfus Premier Family of Funds or certain
funds in the Dreyfus Family of Funds.  This Privilege is
available only for existing accounts.  Shares will be exchanged
on the basis of relative net asset value as described above under
"Fund Exchanges." Enrollment in or modification or cancellation
of this Privilege is effective three business days following
notification by the investor.  An investor will be notified if
his account falls below the amount designated to be exchanged
under this Privilege.  In this case, an investor's account will
fall to zero unless additional investments are made in excess of
the designated amount prior to the next Auto-Exchange
transaction.  Shares held under IRA and other retirement plans
are eligible for this Privilege.  Exchanges of IRA shares may be
made between IRA accounts and from regular accounts to IRA
accounts, but not from IRA accounts to regular accounts.  With
respect to all other retirement accounts, exchanges may be made
only among those accounts.

     Fund Exchanges and the Auto-Exchange Privilege are available
to shareholders resident in any state in which shares of the fund
being acquired may legally be sold.  Shares may be exchanged only
between accounts having identical names and other identifying
designations.

     Shareholder Services Forms and prospectuses of the other
funds may be obtained by calling 1-800-554-4611.  The Fund
reserves the right to reject any exchange request in whole or in
part.  The Fund Exchange service or the Auto-Exchange Privilege
may be modified or terminated at any time upon notice to
shareholders.

     Automatic Withdrawal Plan.  The Automatic Withdrawal Plan
permits an investor with a $5,000 minimum account to request
withdrawal of a specified dollar amount (minimum of $50) on
either a monthly or quarterly basis.  Withdrawal payments are the
proceeds from sales of Fund shares, not the yield on the shares.
If withdrawal payments exceed reinvested dividends and
distributions, the investor's shares will be reduced and
eventually may be depleted.  Automatic Withdrawal may be
terminated at any time by the investor, the Fund or the Transfer
Agent.  Shares for which certificates have been issued may not be
redeemed through the Automatic Withdrawal Plan.

     Dividend Sweep.  Dividend Sweep allows investors to invest
automatically dividends or dividends and capital gain
distributions, if any, from the Fund in shares of the same Class
of another fund in the Dreyfus Premier Family of Funds or certain
funds in the Dreyfus Family of Funds of which the investor is a
shareholder.  Shares of the same Class of other funds purchased
pursuant to this Privilege will be purchased on the basis of
relative net asset value per share as follows:

  A.   Dividends and distributions paid with respect to Class A
     shares by a fund may be invested without imposition of a sales
     load in Class A shares of other funds that are offered without a
     sales load.

  B.   Dividends and distributions paid with respect to Class A
     shares by a fund which does not charge a sales load may be
     invested in Class A shares of other funds sold with a sales load,
     and the applicable sales load will be deducted.

  C.   Dividends and distributions paid with respect to Class A
     shares by a fund which charges a sales load may be invested in
     Class A shares of other funds sold with a sales load (referred to
     herein as "Offered Shares"), provided that, if the sales load
     applicable to the Offered Shares exceeds the maximum sales load
     charged by the fund from which dividends or distributions are
     being swept, without giving effect to any reduced loads, the
     difference will be deducted.

  D.   Dividends and distributions paid with respect to Class B or
     Class C shares by a fund may be invested without imposition of
     any applicable CDSC in the same Class of shares of other funds
     and the relevant Class of shares of such other funds will be
     subject on redemption to any applicable CDSC.


                DETERMINATION OF NET ASSET VALUE

     The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled
"How to Buy Shares."

     Valuation of Portfolio Securities.  The Fund's investments
are valued each business day by an independent pricing service
(the "Service") approved by the Fund's Board.  When, in the
judgment of the Service, quoted bid prices for investments are
readily available and are representative of the bid side of the
market, these investments are valued at the mean between the
quoted bid prices (as obtained by the Service from dealers in
such securities) and asked prices (as calculated by the Service
based upon its evaluation of the market for such securities).
Other investments (which constitute a majority of the portfolio
securities) are carried at fair value as determined by the
Service, based on methods which include consideration of:  yields
or prices of municipal bonds of comparable quality, coupon,
maturity and type; indications as to values from dealers; and
general market conditions.  The Service may employ electronic
data processing techniques and/or a matrix system to determine
valuations.  The Service's procedures are reviewed by the Fund's
officers under the general supervision of the Fund's Board.
Expenses and fees, including the management fee (reduced by the
expense limitation, if any) and fees pursuant to the Shareholder
Services Plan, with respect to Class A, Class B and Class C
shares, and fees pursuant to the Distribution Plan, with respect
to Class B and Class C shares only, are accrued daily and are
taken into account for the purpose of determining the net asset
value of the relevant Class of shares.  Because of the difference
in operating expenses incurred by each Class, the per share net
asset value of each Class will differ.

        
     New York Stock Exchange Closings.  The holidays (as
observed) on which the New York Stock Exchange is closed
currently are:  New Year's Day, Martin Luther King Jr. Day,
Presidents' Day, Good Friday, Memorial Day, Independence Day,
Labor Day, Thanksgiving and Christmas.
    


               DIVIDENDS, DISTRIBUTIONS AND TAXES

     The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled
"Dividends, Distributions and Taxes."

   
     Management believes that the Fund qualified as a "regulated
investment company" under the Code for the fiscal year ended
April 30, 1998, and the Fund intends to continue to so qualify so
long as such qualification is in the best interests of its
shareholders.  As a regulated investment company, the Fund will
pay no Federal income tax on net investment income and net
realized capital gains to the extent that such income and gains
are distributed to shareholders in accordance with applicable
provisions of the Code.  To qualify as a regulated investment
company, the Fund must distribute to its shareholders at least
90% of its net income (consisting of net investment income from
tax exempt obligations and taxable obligations, if any, and net
short-term capital gains) and must meet certain asset
diversification and other requirements.  The term "regulated
investment company" does not imply the supervision of management
or investment practices or policies by any government agency.
    

     Any dividend or distribution paid shortly after an
investor's purchase may have the effect of reducing the aggregate
net asset value of his shares below the cost of his investment.
Such a distribution would be a return on investment in an
economic sense although taxable as stated under "Dividends,
Distributions and Taxes" in the Prospectus.  In addition, the
Code provides that if a shareholder has not held his shares for
more than six months (or such shorter period as the Internal
Revenue Service may prescribe by regulation) and has received an
exempt-interest dividend with respect to such shares, any loss
incurred on the sale of such shares will be disallowed to the
extent of the exempt-interest dividend received.  Exempt-interest
dividends received with respect to Fund shares may be partially
exempt from certain state or local taxes for the residents of
such state or locality.

     Ordinarily, gains and losses realized from portfolio
transactions will be treated as capital gain or loss.  However,
all or a portion of any gains realized from the sale or other
disposition of certain market discount bonds will be treated as
ordinary income under Section 1276 of the Code.  In addition, all
or a portion of the gain realized from engaging in "conversion
transactions" may be treated as ordinary income under Section
1258 of the Code. "Conversion transactions" are defined to
include certain forward, futures, option and "straddle"
transactions marketed or sold to produce capital gains, or
transactions described in  Treasury regulations to be issued in
the future.

     Under Section 1256 of the Code, gain or loss realized by the
Fund from certain financial futures and options transactions will
be treated as 60% long-term capital gain or loss and 40%
short-term capital gain or loss.  Gain or loss will arise upon
exercise or lapse of such futures and options as well as from
closing transactions.  In addition, any such futures or options
remaining unexercised at the end of the Fund's taxable year will
be treated as sold for their then fair market value, resulting in
additional gain or loss to the Fund characterized in the manner
described above.

   
     Offsetting positions held by the Fund involving certain
futures contracts or options transactions may be considered, for
tax purposes, to constitute "straddles."  "Straddles" are defined
to include "offsetting positions" in actively traded personal
property.  The tax treatment of "straddles" is governed by
Sections 1092 and 1258 of the Code, which, in certain
circumstances, override or modify the provisions of Section 1256
of the Code.
    
   
     If the Fund were treated as entering into "straddles" by
reason of its engaging in certain futures contracts or options
transactions, such "straddles" would be characterized as "mixed
straddles" if the futures or options transactions comprising a
part of such "straddles" were governed by Section 1256 of the
Code.  The Fund may make one or more elections with respect to
"mixed straddles."  Depending on which election is made, if any,
the results to the Fund may differ.  If no election is made, to
the extent the "straddle" rules apply to positions established by
the Fund, losses realized by the Fund will be deferred to the
extent of unrealized gain in the offsetting position.  Moreover,
as a result of the "straddle" and the conversion transaction
rules, short-term capital losses on "straddle" positions may be
recharacterized as long-term capital losses, and long-term
capital gains on straddle positions may be recharacterized as
short-term capital gains or ordinary income.
    
   
     The Taxpayer Relief Act of 1997 included constructive sale
provisions that generally apply if the Fund either (1) holds an
appreciated financial position with respect to stock, certain
debt obligations, or partnership interests ("appreciated
financial position") and then enters into a short sale, futures,
forward, or offsetting notional principal contract (collectively,
a "Contract") respecting the same or substantially identical
property or (2) holds an appreciated financial position that is a
Contract and then acquires property that is the same as, or
substantially identical to, the underlying property.  In each
instance, with certain exceptions, the Fund generally will be
taxed as if the appreciated financial position were sold at its
fair market value on the date the Fund enters into the financial
position or acquires the property, respectively.  Transactions
that are identified as hedging or straddle transactions under
other provisions of the Code can be subject to the constructive
sale provisions.
    

     Investment by the Fund in securities issued at a discount or
providing for deferred interest or for payment of interest in the
form of additional obligations could, under special tax rules,
affect the amount, timing and character of distributions to
shareholders.  For example, the Fund could be required to take
into account annually a portion of the discount (or deemed
discount) at which such securities were issued and to distribute
such portion in order to maintain its qualification as a
regulated investment company.  In such case, the Fund may have to
dispose of securities which it might otherwise have continued to
hold in order to generate cash to satisfy these distribution
requirements.


                     PORTFOLIO TRANSACTIONS

     Portfolio securities ordinarily are purchased from and sold
to parties acting as either principal or agent.  Newly-issued
securities ordinarily are purchased directly from the issuer or
from an underwriter; other purchases and sales usually are placed
with those dealers from which it appears that the best price or
execution will be obtained.  Usually no brokerage commissions, as
such, are paid by the Fund for such purchases and sales, although
the price paid usually includes an undisclosed compensation to
the dealer acting as agent.  The prices paid to underwriters of
newly-issued securities usually include a concession paid by the
issuer to the underwriter, and purchases of after-market
securities from dealers ordinarily are executed at a price
between the bid and asked price.  No brokerage commissions have
been paid by the Fund to date.

     Transactions are allocated to various dealers by the Fund's
portfolio managers in their best judgment.  The primary
consideration is prompt and effective execution of orders at the
most favorable price.  Subject to that primary consideration,
dealers may be selected for research, statistical or other
services to enable the Manager to supplement its own research and
analysis with the views and information of other securities
firms.

     Research services furnished by brokers through which the
Fund effects securities transactions may be used by the Manager
in advising other funds it advises and, conversely, research
services furnished to the Manager by brokers in connection with
other funds the Manager advises may be used by the Manager in
advising the Fund.  Although it is not possible to place a dollar
value on these services, it is the opinion of the Manager that
the receipt and study of such services should not reduce the
overall expenses of its research department.

   
     The Fund's portfolio turnover rate for the fiscal years
ended April 30, 1996, 1997 and 1998 was 36.59%, 28.17% and
26.33%, respectively.  The Fund anticipates that its annual
portfolio turnover rate generally will not exceed 100%, but the
turnover rate will not be a limiting factor when the Fund deems
it desirable to sell or purchase securities.  Therefore,
depending upon market conditions, the Fund's annual portfolio
turnover rate may exceed 100% in particular years.
    
   
     The aggregate amount of transactions during the last fiscal
year in newly issued debt instruments in fixed price public
offerings directed to an underwriter in consideration of, among
other things, research services provided was $0.
    


                    PERFORMANCE INFORMATION

     The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled
"Performance Information."

   
     Current yield for the 30-day period ended April 30, 1998 for
Class A was 4.24%, for Class B was 3.93% and for Class C was
3.55%.  Current yield is computed pursuant to a formula which
operates as follows:  The amount of the Fund's expenses accrued
for the 30-day period (net of reimbursements) is subtracted from
the amount of the dividends and interest earned (computed in
accordance with regulatory requirements) during the period.  That
result is then divided by the product of:  (a) the average daily
number of shares outstanding during the period that were entitled
to receive dividends, and (b) the maximum offering price per
share in the case of Class A or the net asset value per share in
the case of Class B or Class C on the last day of the period less
any undistributed earned income per share reasonably expected to
be declared as a dividend shortly thereafter.  The quotient is
then added to 1, and that sum is raised to the 6th power, after
which 1 is subtracted.  The current yield is then arrived at by
multiplying the result by 2.
    
   
     Based upon a 1997 Federal tax rate of 39.6%, the tax
equivalent yield for the 30-day period ended April 30, 1998 for
Class A was 7.02%, for Class B was 6.51% and for Class C was
5.88%.  Tax equivalent yield is computed by dividing that portion
of the current yield (calculated as described above) which is tax
exempt by 1 minus a stated tax rate and adding the quotient to
that portion, if any, of the yield that is not tax exempt.
    

     The tax equivalent yield noted above represents the
application of the highest Federal marginal personal income tax
rate presently in effect.  The tax equivalent yield figure,
however, does not reflect the potential effect of any state or
local (including, but not limited to, county, district or city)
taxes, including applicable surcharges.  In addition, there may
be pending legislation which could affect such stated tax rate or
yield.  Each investor should consult its tax adviser, and
consider its own factual circumstances and applicable tax laws,
in order to ascertain the relevant tax equivalent yield.

   
     The average annual total return for the 1, 5 and 10 year
periods ended April 30, 1998 for Class A was 5.58%, 5.63% and
8.49%, respectively.  The average annual total return for the 1,
5 and 5.29 year periods ended April 30, 1998 for Class B was
5.95%, 5.72% and 6.49%, respectively.  The average annual total
return for the 1 and 2.8 year periods ended April 30, 1998 for
Class C was 8.73% and 6.43%, respectively.  Average annual total
return is calculated by determining the ending redeemable value
of an investment purchased at net asset value (maximum offering
price in the case of Class A) per share with a hypothetical
$1,000 payment made at the beginning of the period (assuming the
reinvestment of dividends and distributions), dividing by the
amount of the initial investment, taking the "n"th root of the
quotient (where "n" is the number of years in the period) and
subtracting 1 from the result.  A Class' average annual total
return figures calculated in accordance with such formula
provides that in the case of Class A the maximum sales load has
been deducted from the hypothetical initial investment at the
time of purchase or in the case of Class B or Class C the maximum
applicable CDSC has been paid upon redemption at the end of the
period.
    
   
     The aggregate total return excluding sales load for the
period November 26, 1986 (commencement of operations) through
April 30, 1998 for Class A was 131.67%.  The total return net of
sales load for Class A was 121.67% for this period.  The
aggregate total return for the period January 15, 1993
(commencement of initial offering of Class B shares) through
April 30, 1998 for Class B was 39.49%.  Without giving effect to
the applicable CDSC, the aggregate total return for Class B was
40.49% for this period.  The total return for Class C for the
period from July 13, 1995 (commencement of initial offering of
Class C) through April 30, 1998 was 19.05%.  Total return is
calculated by subtracting the amount of the Fund's net asset
value (maximum offering price in the case of Class A) per share
at the beginning of a stated period from the net asset value per
share at the end of the period (after giving effect to the
reinvestment of dividends and distributions during the period)
and dividing the result by the maximum offering price per share
at the beginning of the period.  Total return also may be
calculated based on the net asset value per share at the
beginning of the period instead of the maximum offering price per
share at the beginning of the period for Class A shares or
without giving effect to any applicable CDSC at the end of the
period for Class B or Class C shares.  In such cases, the
calculation would not reflect the deduction of the sales charge,
which, if reflected, would reduce the performance quoted.
    
   
     From time to time, the Fund may use hypothetical tax
equivalent yields or charts in its advertising.  These
hypothetical yields or charts will be used for illustrative
purposes only and not as being representative of the Fund's past
or future performance.
    
   
     From time to time, advertising materials for the Fund may
refer to or discuss then-current or past economic conditions,
developments and/or events, including those relating to or
arising from actual or proposed tax legislation, statistical or
other information concerning trends relating to investment
companies, as compiled by industry associations, such as the
Investment Company Institute and Morningstar ratings and related
analysis supporting such ratings.  Advertising materials for the
Fund also may include biographical information relating to its
portfolio managers and may refer to, or include, commentary by a
portfolio manager relating to investment strategy, asset growth,
current or past business, political, economic or financial
conditions and other matters of general interest to investors.
    


                   INFORMATION ABOUT THE FUND

     The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled
"General Information."

     Each Fund share has one vote and, when issued and paid for
in accordance with the terms of the offering, is fully paid and
non-assessable.  Shares have no preemptive or subscription rights
and are freely transferable.

   
     Under Massachusetts law, shareholders, under certain
circumstances, could be held personally liable for the
obligations of the Fund.  However, the Fund's Agreement and
Declaration of Trust ("Trust Agreement") disclaims shareholder
liability for acts or obligations of the Fund and requires that
notice of such disclaimer be given in each agreement, obligation
or instrument entered into or executed by the Fund or a Trustee.
The Trust Agreement provides for indemnification from the Fund's
property for all losses and expenses of any shareholder held
personally liable for the obligations of the Fund.  Thus, the
risk of a shareholder's incurring financial loss on account of
shareholder liability is limited to circumstances in which the
Fund itself would be unable to meet its obligations, a
possibility which management believes is remote.  Upon payment of
any liability incurred by the Fund, the shareholder paying such
liability will be entitled to reimbursement from the general
assets of the Fund.  The Fund intends to conduct its operations
in such a way so as to avoid, as far as possible, ultimate
liability of the shareholders for liabilities of the Fund.
    

     The Fund sends annual and semi-annual financial statements
to all its shareholders.

   
     The Manager's legislative efforts led to the 1976
Congressional amendment to the Code permitting an incorporated
mutual fund to pass through tax exempt income to its
shareholders. The Manager offered to the public the first
incorporated tax exempt fund and currently manages or administers
over $24 billion in tax exempt assets.
    

       TRANSFER AND DIVIDEND DISBURSING AGENT, CUSTODIAN,
                COUNSEL AND INDEPENDENT AUDITORS

   
     Dreyfus Transfer, Inc., a wholly-owned subsidiary of the
Manager, P.O. Box 9671, Providence, Rhode Island 02940-9671, is
the Fund's transfer and dividend disbursing agent.  Under a
transfer agency agreement with the Fund, the Transfer Agent
arranges for the maintenance of shareholder account records for
the Fund, the handling of certain communications between
shareholders and the Fund and the payment of dividends and
distributions payable by the Fund.  For these services, the
Transfer Agent receives a monthly fee computed on the basis of
the number of shareholder accounts it maintains for the Fund
during the month, and is reimbursed for certain out-of-pocket
expenses.  For the fiscal year ended April 30, 1998, the Fund
paid the Transfer Agent $255,336.
    
   
     The Bank of New York, 90 Washington Street, New York, New
York 10286, is the Fund's custodian.  The Bank of New York has no
part in determining the investment policies of the Fund or which
securities are to be purchased or sold by the Fund.
    

     Stroock & Stroock & Lavan LLP, 180 Maiden Lane, New York,
New York 10038-4982, as counsel for the Fund, has rendered its
opinion as to certain legal matters regarding the due
authorization and valid issuance of the shares being sold
pursuant to the Fund's Prospectus.

     Ernst & Young LLP, 787 Seventh Avenue, New York, New York
10019, independent auditors, has been selected as auditors of the
Fund.

   
     FINANCIAL STATEMENTS AND REPORT OF INDEPENDENT AUDITORS

     The Fund's Annual Report to Shareholders for the fiscal year
ended April 30, 1998 is a separate document supplied with this
Statement of Additional Information, and the financial
statements, accompanying notes and report of independent auditors
appearing therein are incorporated by reference into this
Statement of Additional Information.
    

                            APPENDIX

   
     Description of certain S&P, Moody's and Fitch ratings:
    

S&P

Municipal Bond Ratings

     An S&P municipal bond rating is a current assessment of the
creditworthiness of an obligor with respect to a specific
obligation.

     The ratings are based on current information furnished by
the issuer or obtained by S&P from other sources it considers
reliable, and will include:  (1) likelihood of default--capacity
and willingness of the obligor as to the timely payment of
interest and repayment of principal in accordance with the terms
of the obligation; (2) nature and provisions of the obligation;
and (3) protection afforded by, and relative position of, the
obligation in the event of bankruptcy, reorganization or other
arrangement under the laws of bankruptcy and other laws affecting
creditors' rights.

                              AAA

     Debt rated AAA has the highest rating assigned by S&P.
Capacity to pay interest and repay principal is extremely strong.

                               AA

     Debt rated AA has a very strong capacity to pay interest and
repay principal and differs from the highest rated issues only in
a small degree.

                               A

     Principal and interest payments on bonds in this category
are regarded as safe.  This rating describes the third strongest
capacity for payment of debt service.  It differs from the two
higher ratings because:

     General Obligation Bonds -- There is some weakness in the
local economic base, in debt burden, in the balance between
revenues and expenditures, or in quality of management.  Under
certain adverse circumstances, any one such weakness might impair
the ability of the issuer to meet debt obligations at some future
date.

     Revenue Bonds -- Debt service coverage is good, but not
exceptional.  Stability of the pledged revenues could show some
variations because of increased competition or economic
influences on revenues.  Basic security provisions, while
satisfactory, are less stringent.  Management performance appears
adequate.

                              BBB

     Of the investment grade, this is the lowest.

     General Obligation Bonds -- Under certain adverse
conditions, several of the above factors could contribute to a
lesser capacity for payment of debt service.  The difference
between an A and BBB rating is that the latter shows more than
one fundamental weakness, or one very substantial fundamental
weakness, whereas the former shows only one deficiency among the
factors considered.

     Revenue Bonds -- Debt coverage is only fair.  Stability of
the pledged revenues could show substantial variations, with the
revenue flow possibly being subject to erosion over time.  Basic
security provisions are no more than adequate.  Management
performance could be stronger.

                       BB, B, CCC, CC, C

     Debt rated BB, B, CCC, CC or C is regarded as having
predominantly speculative characteristics with respect to
capacity to pay interest and repay principal.  BB indicates the
least degree of speculation and C the highest degree of
speculation.  While such debt will likely have some quality and
protective characteristics, these are outweighed by large
uncertainties or major risk exposures to adverse conditions.

                               BB

     Debt rated BB has less near-term vulnerability to default
than other speculative grade debt.  However, it faces major
ongoing uncertainties or exposure to adverse business, financial
or economic conditions which could lead to inadequate capacity to
meet timely interest and principal payment.

                               B

     Debt rated B has a greater vulnerability to default but
presently has the capacity to meet interest payments and
principal repayments.  Adverse business, financial or economic
conditions would likely impair capacity or willingness to pay
interest and repay principal.

                              CCC

     Debt rated CCC has a current identifiable vulnerability to
default, and is dependent upon favorable business, financial and
economic conditions to meet timely payments of interest and
repayment of principal.  In the event of adverse business,
financial or economic conditions, it is not likely to have the
capacity to pay interest and repay principal.

                               CC

     The rating CC is typically applied to debt subordinated to
senior debt which is assigned an actual or implied CCC rating.

                               C

     The rating C is typically applied to debt subordinated to
senior debt which is assigned an actual or implied CCC- debt
rating.

                               D

     Bonds rated D are in default, and payment of interest and/or
payment of principal is in arrears.

     Plus (+) or minus (-):  The ratings from AA to CCC may be
modified by the addition of a plus or minus designation to show
relative standing within the major rating categories.

Municipal Note Ratings

                              SP-1

     The issuers of these municipal notes exhibit very strong or
strong capacity to pay principal and interest.  Those issues
determined to possess overwhelming safety characteristics are
given a plus (+) designation.

                              SP-2

     The issuers of these municipal notes exhibit satisfactory
capacity to pay principal and interest.

                              SP-3

     The issuers of these municipal notes exhibit speculative
capacity to pay principal and interest.

Commercial Paper Ratings

     An S&P commercial paper rating is a current assessment of
the likelihood of timely payment of debt having an original
maturity of no more than 365 days.  Issues assigned an A rating
are regarded as having the greatest capacity for timely payment.
Issues in this category are delineated with the numbers 1, 2 and
3 to indicate the relative degree of safety.

                              A-1

     This designation indicates that the degree of safety
regarding timely payment is either overwhelming or very strong.
Those issues determined to possess overwhelming safety
characteristics are denoted with a plus (+) designation.

                              A-2

     Capacity for timely payment on issues with this designation
is strong.  However, the relative degree of safety is not as high
as for issues designated A-1.

                              A-3

     Issues carrying this designation have a satisfactory
capacity for timely payment.  They are, however, somewhat more
vulnerable to the adverse effects of changes in circumstances
than obligations carrying the higher designations.

                               B

     Issues rated B are regarded as having only an adequate
capacity for timely payment; such capacity may be damaged by
changing conditions or short-term adversities.

                               C

     This rating is assigned to short-term debt obligations with
a doubtful capacity for payment.

Moody's

Municipal Bond Ratings

                              Aaa

     Bonds which are rated Aaa are judged to be of the best
quality.  They carry the smallest degree of investment risk and
are generally referred to as "gilt edge."  Interest payments are
protected by a large or by an exceptionally stable margin and
principal is secure.  While the various protective elements are
likely to change, such changes as can be visualized are most
unlikely to impair the fundamentally strong position of such
issues.

                               Aa

     Bonds which are rated Aa are judged to be of high quality by
all standards.  Together with the Aaa group they comprise what
generally are known as high-grade bonds.  They are rated lower
than the best bonds because margins of protection may not be as
large as in Aaa securities or fluctuation of protective elements
may be of greater amplitude or there may be other elements
present which make the long-term risks appear somewhat larger
than in Aaa securities.


                               A

     Bonds which are rated A possess many favorable investment
attributes and are to be considered as upper medium-grade
obligations.  Factors giving security to principal and interest
are considered adequate, but elements may be present which
suggest a susceptibility to impairment sometime in the future.

                              Baa

     Bonds which are rated Baa are considered as medium-grade
obligations, i.e., they are neither highly protected nor poorly
secured.  Interest payments and principal security appear
adequate for the present but certain protective elements may be
lacking or may be characteristically unreliable over any great
length of time.  Such bonds lack outstanding investment
characteristics and in fact have speculative characteristics as
well.

                               Ba

     Bonds which are rated Ba are judged to have speculative
elements; their future cannot be considered as well assured.
Often the protection of interest and principal payments may be
very moderate, and therefore not well safeguarded during both
good and bad times over the future.  Uncertainty of position
characterizes bonds in this class.

                               B

     Bonds which are rated B generally lack characteristics of
the desirable investment.  Assurance of interest and principal
payments or of maintenance of other terms of the contract over
any long period of time may be small.

                              Caa

     Bonds which are rated Caa are of poor standing.  Such issues
may be in default or there may be present elements of danger with
respect to principal or interest.

                               Ca

     Bonds which are rated Ca present obligations which are
speculative in a high degree.  Such issues are often in default
or have other marked shortcomings.

                               C

     Bonds which are rated C are the lowest rated class of bonds,
and issues so rated can be regarded as having extremely poor
prospects of ever attaining any real investment standing.

     Generally, Moody's provides either a generic rating or a
rating with a numerical modifier of 1 for the bonds in the
generic rating category Aa.  Moody's also provides numerical
modifiers of 2 and 3 in this category for bond issues in the
health care, higher education and other not-for-profit sectors;
the modifier 1 indicates that the issue ranks in the higher end
of that generic rating category; the modifier 2 indicates that
the issue is in the mid-range of that generic category; and the
modifier 3 indicates that the issue is in the low end of that
generic category.

Municipal Note Ratings

     Moody's ratings for state and municipal notes and other
short-term loans are designated Moody's Investment Grade (MIG).
Such ratings recognize the difference between short-term credit
risk and long-term risk.  Factors affecting the liquidity of the
borrower and short-term cyclical elements are critical in
short-term ratings, while other factors of major importance in
bond risk, long-term secular trends for example, may be less
important over the short run.

     A short-term rating may also be assigned on an issue having
a demand feature.  Such ratings will be designated as VMIG or, if
the demand feature is not rated, as NR.  Short-term ratings on
issues with demand features are differentiated by the use of the
VMIG symbol to reflect such characteristics as payment upon
periodic demand rather than fixed maturity dates and payment
relying on external liquidity.  Additionally, investors should be
alert to the fact that the source of payment may be limited to
the external liquidity with no or limited legal recourse to the
issuer in the event the demand is not met.

     Moody's short-term ratings are designated Moody's Investment
Grade as MIG 1 or VMIG 1 through MIG 4 or VMIG 4.  As the name
implies, when Moody's assigns a MIG or VMIG rating, all
categories define an investment grade situation.

                          MIG 1/VMIG 1

     This designation denotes best quality.  There is present
strong protection by established cash flows, superior liquidity
support or demonstrated broad-based access to the market for
refinancing.

                          MIG 2/VMIG 2

     This designation denotes high quality.  Margins of
protection are ample although not so large as in the preceding
group.

                          MIG 3/VMIG 3

     This designation denotes favorable quality.  All security
elements are accounted for but there is lacking the undeniable
strength of the preceding grades.  Liquidity and cash flow
protection may be narrow and market access for refinancing is
likely to be less well established.

                          MIG 4/VMIG 4

     This designation denotes adequate quality.  Protection
commonly regarded as required of an investment security is
present and although not distinctly or predominantly speculative,
there is specific risk.

Commercial Paper Ratings

     The rating Prime-1 (P-1) is the highest commercial paper
rating assigned by Moody's.  Issuers of P-1 paper must have a
superior capacity for repayment of short-term promissory
obligations, and ordinarily will be evidenced by leading market
positions in well established industries, high rates of return on
funds employed, conservative capitalization structures with
moderate reliance on debt and ample asset protection, broad
margins in earnings coverage of fixed financial charges and high
internal cash generation, and well established access to a range
of financial markets and assured sources of alternate liquidity.

     Issuers (or related supporting institutions) rated Prime-2
(P-2) have a strong capacity for repayment of short-term
promissory obligations.  This ordinarily will be evidenced by
many of the characteristics cited above but to a lesser degree.
Earnings trends and coverage ratios, while sound, will be more
subject to variation.  Capitalization characteristics, while
still appropriate, may be more affected by external conditions.
Ample alternate liquidity is maintained.

     Issuers (or related supporting institutions) rated Prime-3
(P-3) have an acceptable capacity for repayment of short-term
promissory obligations.  The effect of industry characteristics
and market composition may be more pronounced.  Variability in
earnings and profitability may result in changes in the level of
debt protection measurements and the requirements for relatively
high financial leverage.  Adequate alternate liquidity is
maintained.

Fitch

Municipal Bond Ratings

     The ratings represent Fitch's assessment of the issuer's
ability to meet the obligations of a specific debt issue or class
of debt.  The ratings take into consideration special features of
the issue, its relationship to other obligations of the issuer,
the current financial condition and operative performance of the
issuer and of any guarantor, as well as the political and
economic environment that might affect the issuer's future
financial strength and credit quality.

                              AAA

     Bonds rated AAA are considered to be investment grade and of
the highest credit quality.  The obligor has an exceptionally
strong ability to pay interest and repay principal, which is
unlikely to be affected by reasonably foreseeable events.

                               AA

     Bonds rated AA are considered to be investment grade and of
very high credit quality.  The obligor's ability to pay interest
and repay principal is very strong, although not quite as strong
as bonds rated AAA.  Because bonds rated in the AAA and AA
categories are not significantly vulnerable to foreseeable future
developments, short-term debt of these issuers is generally rated
F-1+.

                               A

     Bonds rated A are considered to be investment grade and of
high credit quality.  The obligor's ability to pay interest and
repay principal is considered to be strong, but may be more
vulnerable to adverse changes in economic conditions and
circumstances than bonds with higher ratings.

                              BBB

     Bonds rated BBB are considered to be investment grade and of
satisfactory credit quality.  The obligor's ability to pay
interest and repay principal is considered to be adequate.
Adverse changes in economic conditions and circumstances,
however, are more likely to have an adverse impact on these bonds
and, therefore, impair timely payment.  The likelihood that the
ratings of these bonds will fall below investment grade is higher
than for bonds with higher ratings.

                               BB

     Bonds rated BB are considered speculative.  The obligor's
ability to pay interest and repay principal may be affected over
time by adverse economic changes.  However, business and
financial alternatives can be identified which could assist the
obligor in satisfying its debt service requirements.

                               B

     Bonds rated B are considered highly speculative.  While
bonds in this class are currently meeting debt service
requirements, the probability of continued timely payment of
principal and interest reflects the obligor's limited margin of
safety and the need for reasonable business and economic activity
throughout the life of the issue.

                              CCC

     Bonds rated CCC have certain identifiable characteristics,
which, if not remedied, may lead to default.  The ability to meet
obligations requires an advantageous business and economic
environment.

                               CC

     Bonds rated CC are minimally protected.  Default payment of
interest and/or principal seems probable over time.

                               C

     Bonds rated C are in imminent default in payment of interest
or principal.

                         DDD, DD and D

     Bonds rated DDD, DD and D are in actual or imminent default
of interest and/or principal payments.  Such bonds are extremely
speculative and should be valued on the basis of their ultimate
recovery value in liquidation or reorganization of the obligor.
DDD represents the highest potential for recovery on these bonds
and D represents the lowest potential for recovery.

     Plus (+) and minus (-) signs are used with a rating symbol
to indicate the relative position of a credit within the rating
category.  Plus and minus signs, however, are not used in the AAA
category covering 12-36 months or the DDD, DD or D categories.

Short-Term Ratings

     Fitch's short-term ratings apply to debt obligations that
are payable on demand or have original maturities of up to three
years, including commercial paper, certificates of deposit,
medium-term notes, and municipal and investment notes.

     Although the credit analysis is similar to Fitch's bond
rating analysis, the short-term rating places greater emphasis
than bond ratings on the existence of liquidity necessary to meet
the issuer's obligations in a timely manner.

                              F-1+

     Exceptionally Strong Credit Quality.  Issues assigned this
rating are regarded as having the strongest degree of assurance
for timely payment.

                              F-1

     Very Strong Credit Quality.  Issues assigned this rating
reflect an assurance of timely payment only slightly less in
degree than issues rated F-1+.

                              F-2

     Good Credit Quality.  Issues carrying this rating have a
satisfactory degree of assurance for timely payments, but the
margin of safety is not as great as the F-1+ and F-1 categories.

Demand Bond or Notes Ratings

     Certain demand securities empower the holder at his option
to require the issuer, usually through a remarketing agent, to
repurchase the security upon notice at par with accrued interest.
This is also referred to as a put option.  The ratings of the
demand provision may be changed or withdrawn at any time if, in
Fitch's judgment, changing circumstances warrant such action.

     Fitch demand provision ratings carry the same symbols and
related definitions as its sshort-term ratings.



                    DREYFUS PREMIER MUNICIPAL BOND FUND


                         PART C. OTHER INFORMATION
                           _________________________

   
Item 24.  Financial Statements and Exhibits - List
_______    _________________________________________
    

     (a)  Financial Statements:

               Included in Part A of the Registration Statement:

               Condensed Financial Information for each of the ten years
               ended April 30, 1998.

               Included in Part B of the Registration Statement:
   
                   Statement of Investments-- April 30, 1998*

                   Statement of Assets and Liabilities--April 30, 1998*

                   Statement of Operations--year ended April 30, 1998*

                   Statement of Changes in Net Assets--for each of the two
                   years ended April 30, 1997 and 1998*

                   Financial Highlights -- for each of the years indicated
                   therein*

                    Notes to Financial Statements*

                    Report of Ernst & Young LLP, Independent Auditors, dated
                    June 4, 1998*
__________________
*Incorporated by reference to Registrant's Annual Report on Form N-30D for
the      fiscal year ended April 30, 1998 filed with the Commission on July
2, 1998.

All Schedules and other financial statement information, for which provision
is made in the applicable accounting regulations of the Securities and
Exchange Commission, are either omitted because they are not required under
the related instructions, they are inapplicable, or the required information
is presented in the financial statements or notes thereto which are
incorporated by reference in Part B of the Registration Statement.
    

Item 24.  Financial Statements and Exhibits. - List (continued)
_______    _____________________________________________________


 (b)      Exhibits:

          (1)(a)    Registrant's Amended and Restated Agreement and
          Declaration of Trust is incorporated by reference to Exhibit (1)
          of Post-Effective Amendment No. 13 to the Registration Statement
          on Form N-1A, filed on July 12, 1995.
   
 (1)(b)   Registrant's Amendment to Agreement and Declaration of Trust is
          incorporated by reference to Exhibit (1) (b) of Post-Effective
          Amendment No. 18 to the Registration Statement on Form N-1A, filed
          on August 13, 1997.
    

          (2)  Registrant's By-Laws, as amended, are incorporated by
          reference to Exhibit (2) of Post-Effective Amendment No. 12 to the
          Registration Statement on Form N-1A, filed on June 22, 1994.

          (5)  Management Agreement is incorporated by reference to Exhibit
          (5) of Post-Effective Amendment No. 13 to the Registration
          Statement on Form N-1A, filed on July 12, 1995.

          (6)(a)    Distribution Agreement is incorporated by reference to
          Exhibit (6)(a) of Post-Effective Amendment No. 13 to the
          Registration Statement on Form N-1A, filed on July 12, 1995.

          (6)(b)    Forms of Shareholder Services Plan Agreements are
          incorporated by reference to Exhibit (6)(b) of Post-Effective
          Amendment No. 13 to the Registration Statement on Form N-1A, filed
          on July 12, 1995.

          (6)(c)    Forms of Distribution Plan Agreements are incorporated
          by reference to Exhibit (6)(c) of Post-Effective Amendment No. 13
          to the Registration Statement on Form N-1A, filed on July 12,
          1995.

          (8)(a)    Amended and Restated Custody Agreement is incorporated
          by reference to Exhibit (8)(a) of Post-Effective Amendment No. 13
          to the Registration Statement on Form N-1A, filed on July 12,
          1995.

          (8)(b)    Sub-Custodian Agreements are incorporated by reference
          to Exhibit (8)(b) of Post-Effective Amendment No. 12 to the
          Registration Statement on Form N-1A, filed on June 22, 1994.

          (9)  Shareholder Services Plan is incorporated by reference to
          Exhibit (9) of Post-Effective Amendment No. 13 to the Registration
          Statement on Form N-1A, filed on July 12, 1995.

          (10) Opinion and consent of Registrant's counsel is incorporated
          by reference to Exhibit (10) of Post-Effective Amendment No. 13 to
          the Registration Statement on Form N-1A, filed on July 12, 1995.

          (11) Consent of Independent Auditors.

Item 24.  Financial Statements and Exhibits. - List (continued)
_______   _____________________________________________________

          (15) Distribution Plan is incorporated by reference to Exhibit
          (15) of Post-Effective Amendment No. 13 to the Registration
          Statement on Form N-1A, filed on July 12, 1995.

          (16) Schedules of Computation of Performance Data are incorporated
          by reference to Exhibit (16) of Post-Effective Amendment No. 12 to
          the Registration Statement on Form N-1A, filed on June 22, 1994.

          (18) Registrant's Rule 18f-3 Plan is incorporated by reference to
          Exhibit (18) of Post-Effective Amendment No. 18 to the
          Registration Statement on Form N-1A, filed on March 30, 1995.

          Other Exhibits
          ______________

                           (a)          Power of Attorney of the Trustees.

                           (b)          Certificate of Assistant Secretary.

Item 25.  Persons Controlled by or under Common Control with Registrant.
_______   ______________________________________________________________

          Not Applicable

Item 26.  Number of Holders of Securities.
_______   ________________________________

   
            (1)                                   (2)
                                                  Number of Record
        Title of Class                      Holders as of August 13, 1998
        ______________                      _____________________________

        Beneficial Interest
        (Par value $.001)
               Class A                                  9,478
               Class B                                  3,165
               Class C                                     41
    

Item 27. Indemnification
_______  _______________

         Reference is made to Article VIII of the Registrant's Amended
         and Restated Declaration of Trust incorporated by reference to
         Exhibit (1) of Post-Effective Amendment  No. 13 to the Registration
         Statement on Form N-1A, filed on July 12, 1995.  The application of
         these provisions is limited by Article 10 of the Registrant's By-
         Laws, as amended, incorporated by reference to Exhibit (2) of Post-
         Effective Amendment No. 12 to the Registration Statement on Form N-
         1A, filed on June 22, 1994, and by the following undertaking set
         forth in the rules promulgated by the Securities and Exchange
         Commission:

           Insofar as indemnification for liabilities arising under the
           Securities Act of 1933 may be permitted to trustees, officers
           and controlling persons of the registrant pursuant to the
           foregoing provisions, or otherwise, the registrant has been ad
           vised that in the opinion of the Securities and Exchange
           Commission such indemnification is against public policy as
           expressed in such Act and is, therefore, unenforceable.  In the
           event that a claim for indemnification is against such
           liabilities (other than the payment by the registrant of
           expenses incurred or paid by a trustee, officer or controlling
           person of the registrant in the successful defense of any such
           action, suit or proceeding) is asserted by such trustee, officer
           or controlling person in connection with the securities being
           registered, the registrant will, unless in the opinion  of its
           counsel the matter has been settled by controlling precedent,
           submit to a court of appropriate jurisdiction the question
           whether such indemnification by it is against public policy as
           expressed in such Act and will be governed by the final
           adjudication of such issue.

        Reference is also made to the Distribution Agreement attached as
        Exhibit (6)(a) of Post-Effective Amendment No. 13 to the
        Registration Statement on From N-1A, filed on July 12, 1995.

Item 28.   Business and Other Connections of Investment Adviser.
_______    ____________________________________________________

   
           The Dreyfus Corporation ("Dreyfus") and subsidiary companies
           comprise a financial service organization whose business
           consists primarily of providing investment management services
           as the investment adviser and manager for sponsored investment
           companies registered under the Investment Company Act of 1940
           and as an investment adviser to institutional and individual
           accounts.  Dreyfus also serves as sub-investment adviser to
           and/or administrator of other investment companies. Dreyfus
           Service Corporation, a wholly-owned subsidiary of Dreyfus,
           serves primarily as a registered broker-dealer of shares of
           investment companies sponsored by Dreyfus and of other
           investment companies  for which Dreyfus acts as investment
           adviser, sub-investment adviser or administrator.  Dreyfus
           Investment Advisors, Inc., another wholly-owned subsidiary,
           provides investment management services to various pension
           plans, institutions and individuals.
    
Item 28.  Business and Other Connections of Investment Adviser (continued)
________  ________________________________________________________________

          Officers and Directors of Investment Adviser
          ____________________________________________

Name and Position
with Dreyfus             Other Businesses
_________________        ________________
   
W. KEITH SMITH           Senior Vice Chairman:
Chairman of the               Mellon Bank, N.A.*;
Board                    President and Director:
                              The Bridgewater Land Co., Inc.**;
                              Mellon Preferred Capital Corporation**;
                              TBC Securities Co., Inc.**;
                              Wellington-Medford II Properties, Inc.**;
                         Chairman, President and Chief Executive Officer:
                              Shearson Summit Euromanagement, Inc.*;
                              Shearson Summit EuroPartners, Inc.*;
                              Shearson Summit Management, Inc.*;
                              Shearson Summit Partners, Inc.*;
                              Shearson Venture Capital, Inc.*;
                         Chairman and Chief Executive Officer:
                              The Boston Company, Inc.**;
                              Boston Safe Deposit and Trust Company**;
                              Boston Group Holdings, Inc.**;
                         Director:
                              Dentsply International, Inc.
                              570 West College Avenue
                              York, Pennsylvania 17405;
                              The Boston Company Asset Management, Inc.**;
                              Mellon Europe Limited
                              London, England;
                              Mellon Global Investing Corp.*;
                              Mellon Accounting Services, Inc.*;
                              MGIC-UK Ltd.;
                              Mellon Capital Management Corporation***;
                         Chairman:
                              Mellon Financial Company*;
                              Buck Consultants, Inc.
                              1 Pennsylvania Plaza, 29th Floor
                              New York, New York 10019;
                         Director and Vice Chairman:
                              Mellon Financial Services Corporation*;
                              Mellon Bank Corporation*;
                         Trustee:
                              Laurel Capital Advisors, LLP*;
                              Mellon Equity Associates, LLP*;
                              Mellon Bond Associates, LLP*;
                         Past Director:
                              Access Capital Strategies Corp.
                              124 Mount Auburn Street
                              Suite 200 North
                              Cambridge, MA 02138

    
   

W. KEITH SMITH           Past Trustee:
Chairman of the Board         Franklin Portfolio Associates Trust
(continued)                   2 International Place, 22nd Floor
                              Boston, MA 02110
    
   

MANDELL L. BERMAN        Real estate consultant and private investor
Director                      29100 Northwestern Highway, Suite 370
                              Southfield, Michigan 48034
    
   


BURTON C. BORGELT        Director:
Director                      Dentsply
                              International, Inc.
                              570 West College Avenue
                              York, Pennsylvania 17405;
                              DeVlieg-Bullard, Inc.
                              1 Gorham Island
                              Westport, Connecticut 06880;
                              Mellon Bank Corporation*;
                              Mellon Bank, N.A.*
    
   

FRANK V. CAHOUET         Chairman of the Board, President and
Director                 Chief Executive Officer:
                              Mellon Bank Corporation*;
                         Director:
                              Avery Dennison Corporation
                              150 North Orange Grove Boulevard
                              Pasadena, California 91103;
                              Saint-Gobain Corporation
                              750 East Swedesford Road
                              Valley Forge, Pennsylvania 19482;
                              Alleghany Teledyne, Inc.
                              1901 Avenue of the Stars
                              Los Angeles, California 90067;
                         Past Chairman, President and Chief Executive Officer:
                              Mellon Bank, N.A.*
    
   

STEPHEN E. CANTER        Chairman and President:
Vice Chairman,                Dreyfus Investment Advisors, Inc.****
Chief Investment Officer,Director:
and a Director                The Dreyfus Trust Company+
    
   

CHRISTOPHER M. CONDRON   President and Chief Operating Officer:
President, Chief              Mellon Bank, N.A.*;
Executive Officer,       President and Director:
Chief Operating               Boston Safe Advisors, Inc.**;
Officer and a            Vice-Chairman and Director:
Director                      Mellon Bank Corporation*;
                              The Boston Company, Inc.**;
                         Director:
                              Certus Asset Advisors Corporation++;
                              Mellon Capital Management Corporation***;
                              Boston Safe Deposit and Trust Company**;
                         Past President and Director:
                              The Boston Company Financial Services, Inc.**;
                         Past President:
                              The Boston Company Financial Strategies, Inc.**;
CHRISTOPHER M. CONDRON        Boston Safe Deposit and Trust Company**;
President, Chief         Past Director:
Executive Officer,            Mellon Preferred Capital Corporation**;
Chief Operating               Access Capital Strategies Corp.
Officer and a Director        124 Mount Auburn Street
(continued)                   Suite 200 North
                              Cambridge, MA 02138;
                         Past Chairman, President, and Chief Executive Officer:
                              The Boston Company Asset Management, Inc.**;
                         Past Partner Representative:
                              Pareto Partners
                              271 Regent Street
                              London, England W1R 8PP;
                         Past Trustee:
                              Franklin Portfolio Associates Trust
                              2 International Place, 22nd Floor
                              Boston, MA. 02710;
                              Mellon Bond Associates, LLP*;
                              Mellon Equity Associates, LLP*;
    
   

LAWRENCE S. KASH         Executive Vice President:
Vice Chairman-Distribution    Mellon Bank, N.A.*;
and a Director           Chairman, President and Director:
                              The Dreyfus Consumer Credit Corporation****;
                         Trustee, President and Chief Executive Officer:
                              Laurel Capital Advisors, LLP*;
                         Director:
                              Dreyfus Investment Advisors, Inc.****;
                              Seven Six Seven Agency, Inc.****;
                         President and Director:
                              Dreyfus Service Corporation+;
                              Dreyfus Precious Metals, Inc.+;
                              Dreyfus Service Organization, Inc.****;
                              The Boston Company, Inc.**;
                              Boston Group Holdings, Inc.**;
                         Chairman and Chief Executive Officer:
                              Dreyfus Brokerage Services, Inc.
                              401 North Maple Avenue
                              Beverly Hills, CA 90210;
                         Chairman, President and Chief Executive Officer:
                              The Dreyfus Trust Company+;
                              The Boston Company Advisors, Inc.
                              Wilmington, DE.
    
   

J. DAVID OFFICER         Director:
Vice Chairman                 Dreyfus Financial Services Corporation*****;
and a Director                Dreyfus Investment Services Corporation*****;
                              Mellon Trust of Florida
                              2875 Northeast 191st Street
                              North Miami Beach, Florida 33180;
                              Mellon Preferred Capital Corporation**;
                              Boston Group Holdings, Inc.**;
                              Mellon Trust of New York
                              1301 Avenue of the Americas - 41st Floor
                              New York, New York 10019;

J. DAVID OFFICER              Mellon Trust of California
Vice Chairman                 400 South Hope Street
and a Director                Los Angeles, California 90071-2806;
(continued)                   Dreyfus Insurance Agency of Massachusetts, Inc.
                              53 State Street
                              Boston, Massachusetts 02109;
                         Executive Vice President:
                              Dreyfus Service Corporation****;
                              Mellon Bank, N.A.*;
                         Vice Chairman and Director:
                              The Boston Company, Inc.**;
                         President and Director:
                              RECO, Inc.**;
                              The Boston Company Financial Services, Inc.**;
                              Boston Safe Deposit and Trust Company**;
    
   

RICHARD F. SYRON         Chairman of the Board and Chief Executive Officer:
Director                      American Stock Exchange
                              86 Trinity Place
                              New York, New York 10006;
                         Director:
                              John Hancock Mutual Life Insurance Company
                              John Hancock Place, Box 111
                              Boston, Massachusetts 02117;
                              Thermo Electron Corporation
                              81 Wyman Street, Box 9046
                              Waltham, Massachusetts 02254-9046;
                              American Business Conference
                              1730 K Street, NW, Suite 120
                              Washington, D.C. 20006;
                         Trustee:
                              Boston College - Board of Trustees
                              140 Commonwealth Ave.
                              Chestnut Hill, Massachusetts 02167-3934
    
   

RONALD P. O'HANLEY III   Director:
Vice Chairman                 The Boston Company Asset Management, LLC**;
                              TBCAM Holding, Inc.**;
                              Franklin Portfolio Holdings, Inc.
                              Two International Place - 22nd Floor
                              Boston, Massachusetts 02110;
                              Mellon Capital Management Corporation***;
                              Certus Asset Advisors Corporation++;
                              Mellon-France Corporation***;
                         Chairman and Director:
                              Boston Safe Advisors, Inc.**;
                         Partner Representative:
                              Pareto Partners
                              271 Regent Street
                              London, England W1R 8PP;
                         Chairman and Trustee:
                              Mellon Bond Associates, LLP*;
                              Mellon Equity Associates, LLP*;
                         Trustee:
                              Laurel Capital Advisors, LLP*;

RONALD P. O'HANLEY III   Chairman, President and Chief Executive Officer:
Vice Chairman                 Mellon Global Investing Corp.*;
(continued)              Partner:
                              McKinsey & Company, Inc.
                              Boston, Massachusetts
    
   

WILLIAM T. SANDALLS, JR. Chairman and Director:
Senior Vice President and     Dreyfus Transfer, Inc.
Chief Financial Officer       One American Express Plaza
                              Providence, Rhode Island 02903;
                         President and Director:
                              Dreyfus-Lincoln, Inc.
                              4500 New Linden Hill Rd.
                              Wilmington, DE 19808;
                         Executive Vice President and Chief Financial Officer:
                              Dreyfus Service Corporation****;
                         Executive Vice President, Treasurer and Director:
                              Dreyfus Service Organization, Inc.****;
                         Director and Treasurer:
                              Dreyfus Investment Advisors, Inc.****;
                              Seven Six Seven Agency, Inc.****;
                              Dreyfus Precious Metals, Inc.+;
                         Director, Vice President and Treasurer:
                              The Dreyfus Consumer Credit Corporation****;
                              The TruePenny Corporation****
                         Director, Treasurer and Chief Financial Officer:
                              The Dreyfus Trust Company+;
                         Past Director and President:
                              Lion Management, Inc.****;
                              Dreyfus Partnership Management, Inc.****;
                         Past Director and Executive Vice President:
                              Dreyfus Service Organization, Inc.****;
                         Past Director and Treasurer:
                              Dreyfus Personal Management, Inc.****
    
   

MARK N. JACOBS           Director:
Vice President,               Dreyfus Service Organization, Inc.****;
General Counsel               The Dreyfus Trust Company+;
and Secretary                 Dreyfus Investment Advisors, Inc.****;
                         Director and Secretary:
                              The TruePenny Corporation****;
                         Past Director, Vice President and Secretary:
                              Lion Management, Inc.****
    
   

PATRICE M. KOZLOWSKI     None
Vice President-
Corporate Communications
    
   

MARY BETH LEIBIG         None
Vice President-
Human Resources
    
   

ANDREW S. WASSER         Vice President:
Vice President-Information    Mellon Bank Corporation*
Services
    
   

JAMES BITETTO            Assistant Secretary:
Assistant Secretary           Dreyfus Service Corporation****;
                              Dreyfus Investment Advisers, Inc.****;
                              Dreyfus Service Organization, Inc.****
    
   

STEVEN F. NEWMAN         Vice President, Secretary and Director:
Assistant Secretary           Dreyfus Transfer, Inc.
                              One American Express Plaza
                              Providence, Rhode Island 02903;
                         Secretary:
                              Dreyfus Service Organization, Inc.****
    
   
______________________________________
*    The address of the business so indicated is One Mellon Bank Center,
     Pittsburgh, Pennsylvania 15258.
**   The address of the business so indicated is One Mellon Bank Place, Boston,
     Massachusetts, 02108.
***  The address of the business so indicated is 595 Market Street, Suite 3000,
     San Francisco CA 94105.
**** The address of the business so indicated is 200 Park Avenue, New York, New
     York 10166.
*****The address of the business so indicated is Union Trust Building, 501
     Grant Street, Pittsburgh, PA 15259.
+    The address of the business so indicated is 144 Glenn Curtiss Boulevard,
     Uniondale, New York, 11556-0144.
++   The address of the business so indicated is One Bush Street, Suite 450,
     San Francisco, CA. 94104.
    

Item 29.  Principal Underwriters
________  ______________________

     (a)  Other investment companies for which Registrant's principal
underwriter (exclusive distributor) acts as principal underwriter or
exclusive distributor:
   
1)        Comstock Partners Funds, Inc.
2)        Dreyfus A Bonds Plus, Inc.
3)        Dreyfus Appreciation Fund, Inc.
4)        Dreyfus Asset Allocation Fund, Inc.
5)        Dreyfus Balanced Fund, Inc.
6)        Dreyfus BASIC GNMA Fund
7)        Dreyfus BASIC Money Market Fund, Inc.
8)        Dreyfus BASIC Municipal Fund, Inc.
9)        Dreyfus BASIC U.S. Government Money Market Fund
10)       Dreyfus California Intermediate Municipal Bond Fund
11)       Dreyfus California Tax Exempt Bond Fund, Inc.
12)       Dreyfus California Tax Exempt Money Market Fund
13)       Dreyfus Cash Management
14)       Dreyfus Cash Management Plus, Inc.
15)       Dreyfus Connecticut Intermediate Municipal Bond Fund
16)       Dreyfus Connecticut Municipal Money Market Fund, Inc.
17)       Dreyfus Florida Intermediate Municipal Bond Fund
18)       Dreyfus Florida Municipal Money Market Fund
19)       The Dreyfus Fund Incorporated
20)       Dreyfus Global Bond Fund, Inc.
21)       Dreyfus Global Growth Fund
22)       Dreyfus GNMA Fund, Inc.
23)       Dreyfus Government Cash Management Funds
24)       Dreyfus Growth and Income Fund, Inc.
25)       Dreyfus Growth and Value Funds, Inc.
26)       Dreyfus Growth Opportunity Fund, Inc.
27)       Dreyfus Income Funds
28)       Dreyfus Index Funds, Inc.
29)       Dreyfus Institutional Money Market Fund
30)       Dreyfus Institutional Preferred Money Market Fund
31)       Dreyfus Institutional Short Term Treasury Fund
32)       Dreyfus Insured Municipal Bond Fund, Inc.
33)       Dreyfus Intermediate Municipal Bond Fund, Inc.
34)       Dreyfus International Funds, Inc.
35)       Dreyfus Investment Grade Bond Funds, Inc.
36)       Dreyfus Investment Portfolios
37)       The Dreyfus/Laurel Funds, Inc.
38)       The Dreyfus/Laurel Funds Trust
39)       The Dreyfus/Laurel Tax-Free Municipal Funds
40)       Dreyfus LifeTime Portfolios, Inc.
41)       Dreyfus Liquid Assets, Inc.
42)       Dreyfus Massachusetts Intermediate Municipal Bond Fund
43)       Dreyfus Massachusetts Municipal Money Market Fund
44)       Dreyfus Massachusetts Tax Exempt Bond Fund
45)       Dreyfus MidCap Index Fund
46)       Dreyfus Money Market Instruments, Inc.
47)       Dreyfus Municipal Bond Fund, Inc.
48)       Dreyfus Municipal Cash Management Plus
49)       Dreyfus Municipal Money Market Fund, Inc.
50)       Dreyfus New Jersey Intermediate Municipal Bond Fund
51)       Dreyfus New Jersey Municipal Bond Fund, Inc.
52)       Dreyfus New Jersey Municipal Money Market Fund, Inc.
53)       Dreyfus New Leaders Fund, Inc.
54)       Dreyfus New York Insured Tax Exempt Bond Fund
55)       Dreyfus New York Municipal Cash Management
56)       Dreyfus New York Tax Exempt Bond Fund, Inc.
57)       Dreyfus New York Tax Exempt Intermediate Bond Fund
58)       Dreyfus New York Tax Exempt Money Market Fund
59)       Dreyfus 100% U.S. Treasury Intermediate Term Fund
60)       Dreyfus 100% U.S. Treasury Long Term Fund
61)       Dreyfus 100% U.S. Treasury Money Market Fund
62)       Dreyfus 100% U.S. Treasury Short Term Fund
63)       Dreyfus Pennsylvania Intermediate Municipal Bond Fund
64)       Dreyfus Pennsylvania Municipal Money Market Fund
65)       Dreyfus Premier California Municipal Bond Fund
66)       Dreyfus Premier Equity Funds, Inc.
67)       Dreyfus Premier International Funds, Inc.
68)       Dreyfus Premier GNMA Fund
69)       Dreyfus Premier Worldwide Growth Fund, Inc.
70)       Dreyfus Premier Insured Municipal Bond Fund
71)       Dreyfus Premier Municipal Bond Fund
72)       Dreyfus Premier New York Municipal Bond Fund
73)       Dreyfus Premier State Municipal Bond Fund
74)       Dreyfus Premier Value Fund
75)       Dreyfus Short-Intermediate Government Fund
76)       Dreyfus Short-Intermediate Municipal Bond Fund
77)       The Dreyfus Socially Responsible Growth Fund, Inc.
78)       Dreyfus Stock Index Fund, Inc.
79)       Dreyfus Tax Exempt Cash Management
80)       The Dreyfus Third Century Fund, Inc.
81)       Dreyfus Treasury Cash Management
82)       Dreyfus Treasury Prime Cash Management
83)       Dreyfus Variable Investment Fund
84)       Dreyfus Worldwide Dollar Money Market Fund, Inc.
85)       General California Municipal Bond Fund, Inc.
86)       General California Municipal Money Market Fund
87)       General Government Securities Money Market Fund, Inc.
88)       General Money Market Fund, Inc.
89)       General Municipal Bond Fund, Inc.
90)       General Municipal Money Market Fund, Inc.
91)       General New York Municipal Bond Fund, Inc.
92)       General New York Municipal Money Market Fund
    



(b)
                                                           Positions and
Name and principal      Positions and offices with         offices with
business address             the Distributor               Registrant
__________________      ___________________________         _____________

Marie E. Connolly+      Director, President, Chief          President and
                        Executive Officer and Compliance    Treasurer
                        Officer

   
Joseph F. Tower, III+   Director, Senior Vice President,    Vice President
                        Treasurer and Chief Financial       and Assistant
                        Officer                             Treasurer
    
   
Mary A. Nelson+         Vice President                      Vice President and
                                                            Assistant Treasurer

Paul Prescott+         Vice President                       None

Jean M. O'Leary+       Assistant Secretary and              None
                       Assistant Clerk

John W. Gomez+         Director                             None

William J. Nutt+       Director                             None



________________________________
 +  Principal business address is 60 State Street, Boston, Massachusetts 02109.
++  Principal business address is 200 Park Avenue, New York, New York 10166.

Item 30.   Location of Accounts and Records ________________________________

                 1.  First Data Investor Services Group, Inc.,
                     a subsidiary of First Data Corporation
                     P.O. Box 9671
                     Providence, Rhode Island 02940-9671

                 2.  The Bank of New York
                     90 Washington Street
                     New York, New York 10286

                 3.  Dreyfus Transfer, Inc.
                     P.O. Box 9671
                     Providence, Rhode Island 02940-9671

                 4.  The Dreyfus Corporation
                     200 Park Avenue
                     New York, New York 10166

Item 31.   Management Services
_______    ___________________

           Not Applicable

Item 32.   Undertakings
________   ____________

  (1)      To call a meeting of shareholders for the purpose of voting upon the
           question of removal of a Board member or Board members when requested
           in writing to do so by the holders of at least 10% of the
           Registrant's outstanding shares and in connection with such meeting
           to comply with the provisions of Section 16(c) of the Investment
           Company Act of 1940 relating to shareholder communications.

  (2)      To furnish each person to whom a prospectus is delivered with a copy
           of the Fund's latest Annual Report to Shareholders, upon request and
           without charge.

                                 SIGNATURES
                                ---------------
   
     Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it meets all of
the requirements for effectiveness of this Amendment to the Registration
Statement pursuant to Rule 485(b) under the Securities Act of 1933 and has
duly caused this Amendment to the Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of New
York, and State of New York on the 27th day of August, 1998.
    

                    DREYFUS PREMIER MUNICIPAL BOND FUND

            BY:    /s/Marie E. Connolly*
                   ___________________________________________
                   MARIE E. CONNOLLY, PRESIDENT

     Pursuant to the requirements of the Securities Act of 1933, this
Amendment to the Registration Statement has been signed below by the
following persons in the capacities and on the dates indicated.

        Signatures                     Title                          Date
__________________________      _______________________________     _________
   
/s/Marie E. Connolly*           President (Principal Executive       8/27/98
______________________________  Officer) and Treasurer
Marie E. Connolly
    
   

/s/Joseph F. Tower, III*        Assistant Treasurer (Principal
______________________________  Accounting and Financial Officer)    8/27/98
Joseph F. Tower III
    
   

/s/Clifford L. Alexander, Jr.*  Trustee                              8/27/98
______________________________
Clifford L. Alexander, Jr.
    
   
/s/Peggy C. Davis*              Trustee                              8/27/98
______________________________
Peggy C. Davis
    
   
Joseph D. DiMartino*            Chairman of the Board of Trustees    8/27/98
______________________________
Joseph D. DiMartino
    
   

/s/Ernest Kafka*                Trustee                              8/27/98
______________________________
Ernest Kafka
    
   
/s/Saul B. Klaman*              Trustee                              8/27/98
______________________________
Saul B. Klaman
    
   
/s/Nathan Leventhal*            Trustee                              8/27/98
______________________________
Nathan Leventhal
    
   
*BY:     __________________________
         Michael S. Petrucelli,
         Attorney-in-Fact
    


                     DREYFUS PREMIER MUNICIPAL BOND FUND

                             INDEX OF EXHIBITS
                             __________________


     ITEM                                                        PAGE
     ____                                                        ____

     24(b)     Exhibits:

     (11)      Consent of Independent Auditors

     (17)      Financial Data Schedule

               Other Exhibits:

     (a)       Power of Attorney of the Trustees

     (b)       Certificate of Assistant Secretary





















                    CONSENT OF INDEPENDENT AUDITORS



We consent to the reference to our firm under the captions "Condensed
Financial Information" and "Transfer and Dividend Disbursing Agent, Custodian,
Counsel and Independent Auditors" and to the use of our report dated June 4,
1998,  which is incorporated by reference, in this Registration Statement
(Form N-1A No. 33-7496) of Dreyfus Premier Municipal Bond Fund.



                                            ERNST & YOUNG LLP

New York, New York
August 26, 1998



<TABLE> <S> <C>

<ARTICLE> 6
<CIK> 0000797923
<NAME> DREYFUS PREMIER MUNICIPAL BOND FUND
<SERIES>
   <NUMBER> 01
   <NAME> CLASS A
<MULTIPLIER> 1000
       
<S>                             <C>
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          APR-30-1998
<PERIOD-END>                               APR-30-1998
<INVESTMENTS-AT-COST>                           524361
<INVESTMENTS-AT-VALUE>                          558444
<RECEIVABLES>                                     9476
<ASSETS-OTHER>                                    8804
<OTHER-ITEMS-ASSETS>                                 0
<TOTAL-ASSETS>                                  576724
<PAYABLE-FOR-SECURITIES>                          5183
<SENIOR-LONG-TERM-DEBT>                              0
<OTHER-ITEMS-LIABILITIES>                         1197
<TOTAL-LIABILITIES>                               6380
<SENIOR-EQUITY>                                      0
<PAID-IN-CAPITAL-COMMON>                        530667
<SHARES-COMMON-STOCK>                            30498
<SHARES-COMMON-PRIOR>                            32415
<ACCUMULATED-NII-CURRENT>                            0
<OVERDISTRIBUTION-NII>                               0
<ACCUMULATED-NET-GAINS>                           5594
<OVERDISTRIBUTION-GAINS>                             0
<ACCUM-APPREC-OR-DEPREC>                         34083
<NET-ASSETS>                                    447869
<DIVIDEND-INCOME>                                    0
<INTEREST-INCOME>                                36307
<OTHER-INCOME>                                       0
<EXPENSES-NET>                                    5838
<NET-INVESTMENT-INCOME>                          30469
<REALIZED-GAINS-CURRENT>                         10610
<APPREC-INCREASE-CURRENT>                        15681
<NET-CHANGE-FROM-OPS>                            56760
<EQUALIZATION>                                       0
<DISTRIBUTIONS-OF-INCOME>                      (24680)
<DISTRIBUTIONS-OF-GAINS>                        (2601)
<DISTRIBUTIONS-OTHER>                                0
<NUMBER-OF-SHARES-SOLD>                           7726
<NUMBER-OF-SHARES-REDEEMED>                    (10709)
<SHARES-REINVESTED>                               1065
<NET-CHANGE-IN-ASSETS>                            2482
<ACCUMULATED-NII-PRIOR>                              0
<ACCUMULATED-GAINS-PRIOR>                       (1732)
<OVERDISTRIB-NII-PRIOR>                              0
<OVERDIST-NET-GAINS-PRIOR>                           0
<GROSS-ADVISORY-FEES>                             3156
<INTEREST-EXPENSE>                                   7
<GROSS-EXPENSE>                                   5838
<AVERAGE-NET-ASSETS>                            455281
<PER-SHARE-NAV-BEGIN>                            14.11
<PER-SHARE-NII>                                   .790
<PER-SHARE-GAIN-APPREC>                           .660
<PER-SHARE-DIVIDEND>                            (.790)
<PER-SHARE-DISTRIBUTIONS>                       (.080)
<RETURNS-OF-CAPITAL>                                 0
<PER-SHARE-NAV-END>                              14.69
<EXPENSE-RATIO>                                   .009
<AVG-DEBT-OUTSTANDING>                              18
<AVG-DEBT-PER-SHARE>                                 0
        


</TABLE>

<TABLE> <S> <C>

<ARTICLE> 6
<CIK> 0000797923
<NAME> DREYFUS PREMIER MUNICIPAL BOND FUND
<SERIES>
   <NUMBER> 02
   <NAME> CLASS B
<MULTIPLIER> 1000
       
<S>                             <C>
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          APR-30-1998
<PERIOD-END>                               APR-30-1998
<INVESTMENTS-AT-COST>                           524361
<INVESTMENTS-AT-VALUE>                          558444
<RECEIVABLES>                                     9476
<ASSETS-OTHER>                                    8804
<OTHER-ITEMS-ASSETS>                                 0
<TOTAL-ASSETS>                                  576724
<PAYABLE-FOR-SECURITIES>                          5183
<SENIOR-LONG-TERM-DEBT>                              0
<OTHER-ITEMS-LIABILITIES>                         1197
<TOTAL-LIABILITIES>                               6380
<SENIOR-EQUITY>                                      0
<PAID-IN-CAPITAL-COMMON>                        530667
<SHARES-COMMON-STOCK>                             8132
<SHARES-COMMON-PRIOR>                             7759
<ACCUMULATED-NII-CURRENT>                            0
<OVERDISTRIBUTION-NII>                               0
<ACCUMULATED-NET-GAINS>                           5594
<OVERDISTRIBUTION-GAINS>                             0
<ACCUM-APPREC-OR-DEPREC>                         34083
<NET-ASSETS>                                    119456
<DIVIDEND-INCOME>                                    0
<INTEREST-INCOME>                                36307
<OTHER-INCOME>                                       0
<EXPENSES-NET>                                    5838
<NET-INVESTMENT-INCOME>                          30469
<REALIZED-GAINS-CURRENT>                         10610
<APPREC-INCREASE-CURRENT>                        15681
<NET-CHANGE-FROM-OPS>                            56760
<EQUALIZATION>                                       0
<DISTRIBUTIONS-OF-INCOME>                       (5696)
<DISTRIBUTIONS-OF-GAINS>                         (671)
<DISTRIBUTIONS-OTHER>                                0
<NUMBER-OF-SHARES-SOLD>                           1206
<NUMBER-OF-SHARES-REDEEMED>                     (1077)
<SHARES-REINVESTED>                                244
<NET-CHANGE-IN-ASSETS>                            2482
<ACCUMULATED-NII-PRIOR>                              0
<ACCUMULATED-GAINS-PRIOR>                       (1732)
<OVERDISTRIB-NII-PRIOR>                              0
<OVERDIST-NET-GAINS-PRIOR>                           0
<GROSS-ADVISORY-FEES>                             3156
<INTEREST-EXPENSE>                                   7
<GROSS-EXPENSE>                                   5838
<AVERAGE-NET-ASSETS>                            116435
<PER-SHARE-NAV-BEGIN>                            14.11
<PER-SHARE-NII>                                   .720
<PER-SHARE-GAIN-APPREC>                           .660
<PER-SHARE-DIVIDEND>                            (.720)
<PER-SHARE-DISTRIBUTIONS>                       (.080)
<RETURNS-OF-CAPITAL>                                 0
<PER-SHARE-NAV-END>                              14.69
<EXPENSE-RATIO>                                   .014
<AVG-DEBT-OUTSTANDING>                              18
<AVG-DEBT-PER-SHARE>                                 0
        


</TABLE>

<TABLE> <S> <C>

<ARTICLE> 6
<CIK> 0000797923
<NAME> DREYFUS PREMIER MUNICIPAL BOND FUND
<SERIES>
   <NUMBER> 03
   <NAME> CLASS C
<MULTIPLIER> 1000
       
<S>                             <C>
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          APR-30-1998
<PERIOD-END>                               APR-30-1998
<INVESTMENTS-AT-COST>                           524361
<INVESTMENTS-AT-VALUE>                          558444
<RECEIVABLES>                                     9476
<ASSETS-OTHER>                                    8804
<OTHER-ITEMS-ASSETS>                                 0
<TOTAL-ASSETS>                                  576724
<PAYABLE-FOR-SECURITIES>                          5183
<SENIOR-LONG-TERM-DEBT>                              0
<OTHER-ITEMS-LIABILITIES>                         1197
<TOTAL-LIABILITIES>                               6380
<SENIOR-EQUITY>                                      0
<PAID-IN-CAPITAL-COMMON>                        530667
<SHARES-COMMON-STOCK>                              205
<SHARES-COMMON-PRIOR>                               74
<ACCUMULATED-NII-CURRENT>                            0
<OVERDISTRIBUTION-NII>                               0
<ACCUMULATED-NET-GAINS>                           5594
<OVERDISTRIBUTION-GAINS>                             0
<ACCUM-APPREC-OR-DEPREC>                         34083
<NET-ASSETS>                                      3019
<DIVIDEND-INCOME>                                    0
<INTEREST-INCOME>                                36307
<OTHER-INCOME>                                       0
<EXPENSES-NET>                                    5838
<NET-INVESTMENT-INCOME>                          30469
<REALIZED-GAINS-CURRENT>                         10610
<APPREC-INCREASE-CURRENT>                        15681
<NET-CHANGE-FROM-OPS>                            56760
<EQUALIZATION>                                       0
<DISTRIBUTIONS-OF-INCOME>                         (93)
<DISTRIBUTIONS-OF-GAINS>                          (13)
<DISTRIBUTIONS-OTHER>                                0
<NUMBER-OF-SHARES-SOLD>                            134
<NUMBER-OF-SHARES-REDEEMED>                        (5)
<SHARES-REINVESTED>                                  3
<NET-CHANGE-IN-ASSETS>                            2482
<ACCUMULATED-NII-PRIOR>                              0
<ACCUMULATED-GAINS-PRIOR>                       (1732)
<OVERDISTRIB-NII-PRIOR>                              0
<OVERDIST-NET-GAINS-PRIOR>                           0
<GROSS-ADVISORY-FEES>                             3156
<INTEREST-EXPENSE>                                   7
<GROSS-EXPENSE>                                   5838
<AVERAGE-NET-ASSETS>                              2052
<PER-SHARE-NAV-BEGIN>                            14.12
<PER-SHARE-NII>                                   .680
<PER-SHARE-GAIN-APPREC>                           .670
<PER-SHARE-DIVIDEND>                            (.680)
<PER-SHARE-DISTRIBUTIONS>                       (.080)
<RETURNS-OF-CAPITAL>                                 0
<PER-SHARE-NAV-END>                              14.71
<EXPENSE-RATIO>                                   .017
<AVG-DEBT-OUTSTANDING>                              18
<AVG-DEBT-PER-SHARE>                                 0
        


</TABLE>

                                                 Item.24 (b)
                                          Other Exhibits (a)


                      POWER OF ATTORNEY

     The undersigned hereby constitute and appoint Margaret
W. Chambers, Marie E. Connolly, Christopher J. Kelley,
Kathleen K. Morrisey, Michael S. Petrucelli, Stephanie
Pierce and Elba Vasquez, and each of them, with full power
to act without the other, his or her true and lawful
attorney-in-fact and agent, with full power of substitution
and resubstitution, for him or her, and in his or her name,
place and stead, in any and all capacities (until revoked in
writing) to sign any and all amendments to the Registration
Statement of Dreyfus Premier Municipal Bond Fund (including
post-effective amendments and amendments thereto), and to
file the same, with all exhibits thereto, and other
documents in connection therewith, with the Securities and
Exchange Commission, granting unto said attorneys-in-fact
and agents, and each of them, full power and authority to do
and perform each and every act and thing ratifying and
confirming all that said attorneys-in-fact and agents or any
of them, or their or his or her substitute or substitutes,
may lawfully do or cause to be done by virtue hereof.


/s/ Clifford L. Alexander, Jr.               June 15, 1998
Clifford L. Alexander, Jr.

/s/ Peggy C. Davis                           June 15, 1998
Peggy C. Davis

/s/ Joseph S. DiMartino                      June 15, 1998
Joseph S. DiMartino

/s/ Ernest Kafka                             June 15, 1998
Ernest Kafka

/s/ Saul B. Klaman                           June 15, 1998
Saul B. Klaman

/s/ Nathan Leventhal                         June 15, 1998
Nathan Leventhal





J34-006-022-028-A-MSW
                                                                  ITEM 24.(b)
                                                            OTHER EXHIBIT (b)

                    DREYFUS PREMIER MUNICIPAL BOND FUND

                     Certificate of Assistant Secretary

     The undersigned, Elba Vasquez, Vice President and Assistant Secretary of
Dreyfus Premier Municipal Bond Fund(the "Fund"), hereby certifies that set
forth below is a copy of the resolution adopted by the Fund's Board
authorizing the signing by Margaret W. Chambers, Marie E. Connolly,
Christopher J. Kelley, Kathleen K. Morrisey, Michael S. Petrucelli, Stephanie
Pierce and Elba Vasquez on behalf of the proper officers of the Fund pursuant
to a power of attorney:

               RESOLVED, that the Registration Statement and any
          and all amendments and supplements thereto, may be signed
          by any one of Margaret W. Chambers, Marie E. Connolly,
          Christopher J. Kelley, Kathleen K. Morrisey, Michael S.
          Petrucelli, Stephanie Pierce and Elba Vasquez as the
          attorney-in-fact for the proper officers of the Fund,
          with full power of substitution and resubstitution; and
          that the appointment of each of such persons as such
          attorney-in-fact hereby is authorized and approved; and
          that such attorneys-in-fact, and each of them, shall have
          full power and authority to do and perform each and every
          act and thing requisite and necessary to be done in
          connection with such Registration Statement and any and
          all amendments and supplements thereto, as fully to all
          intents and purposes as the officer, for whom he or she
          is acting as attorney-in-fact, might or could do in
          person.

          IN WITNESS WHEREOF, I have hereunto signed my name and affixed the
seal of the Fund on June 15, 1998.


                                                  -----------------------
                                                  Elba Vasquez
                                                  Vice President and
                                                  Assistant Secretary



© 2022 IncJournal is not affiliated with or endorsed by the U.S. Securities and Exchange Commission