AMERICAN CENTURY VARIABLE PORTFOLIOS INC, 485BPOS, 1998-04-27

AMERICAN CENTURY VARIABLE PORTFOLIOS INC
485BPOS, 1998-04-27

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As filed with the Securities and Exchange Commission on April 27, 1998

1933 Act File No. 33-14567; 1940 Act File No. 811-5188
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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM N-1A

REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933 _X__

Pre-Effective Amendment No.____ ____

Post-Effective Amendment No._23_ _X__

and/or

REGISTRATION STATEMENT UNDER THE
INVESTMENT COMPANY ACT OF 1940 _X__

Amendment No._23_

AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.
--------------------------------------------
(Exact Name of Registrant as Specified in Charter)

American Century Tower, 4500 Main Street, Kansas City, MO 64111
----------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)

Registrant's Telephone Number, including Area Code: 816-531-5575

William M. Lyons, Esq.

American Century Tower, 4500 Main Street, Kansas City, MO 64111
----------------------------------------------------------------
(Name and address of Agent for service)

Approximate Date of Proposed Public Offering: May 1, 1998

It is proposed that this filing become effective:

_____ immediately upon filing pursuant to paragraph (b) of Rule 485
__X__ on May 1, 1998 pursuant to paragraph (b) of Rule 485
_____ 60 days after filing pursuant to paragraph (a) of Rule 485
_____ on [date] pursuant to paragraph (a)(1) of Rule 485
_____ 75 days afer filing pursuant to paragraph (a)(2) of Rule 485
_____ on [date] pursuant to paragraph (a)(2) of Rule 485

The Registrant has registered an indefinite number or amount of securities under
the Securities Act of 1933 pursuant to Rule 24f-2. The Rule 24f-2 notice for the
fiscal year ended December 31, 1997, was filed on February 24, 1998.

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<PAGE>
================================================================================
CROSS REFERENCE SHEET

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N-1A Item No. Location
------------- --------
PART A

Item 1. Cover Page Cover Page
Item 2. Synopsis N/A
Item 3. Condensed Financial Financial Highlights
Information
Item 4. General Description Investment Policies of
of Registrant the Funds; Shareholders of Variable
Portfolios; Other Investment
Practices, Their Characteristics
and Risks; Performance
Advertising; Distribution
of Fund Shares; Further
Information About
American Century
Item 5. Management of the Management
Fund
Item 6. Capital Stock and Further Information About
Other Securities American Century
Item 7. Purchase of Securities Share Price; Distributions
Being Offered
Item 8. Redemption Share Price
Item 9. Pending Legal Distributions of Fund Shares
Proceedings

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PART B
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Item 10. Cover Page Cover Page
Item 11. Table of Contents Table of Contents
Item 12. General Information N/A
Item 13. Investment Objectives Selection of Investments;
and Policies Additional Investment Restrictions;
Futures Contracts; An Explanation of
Fixed Income Securities Ratings;
Short Sales; Portfolio Lending;
Portfolio Turnover;
Item 14. Management of the Officers and Directors;
Registrant Management;
Custodians
Item 15. Control Persons Capital Stock
and Principal
Holders of Securities
Item 16. Investment Advisory Management;
and Other Services Custodians
Item 17. Brokerage Allocation Brokerage;
Performance Advertising
Item 18. Capital Stock and Capital Stock
Other Securities
Item 19. Purchase, Redemption N/A
and Pricing of
Securities Being
Offered
Item 20. Tax Status N/A
Item 21. Underwriters N/A
Item 22. Calculation of Performance Advertising
Performance Data
Item 23. Financial Statements Financial Statements
<PAGE>
PROSPECTUS

[american century logo(reg.sm)]
American
Century(reg.tm)

MAY 1, 1998

AMERICAN CENTURY
VARIABLE
PORTFOLIOS, INC.

VP Capital Appreciation

PROSPECTUS

MAY 1, 1998

VP Capital Appreciation

AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.

American Century Variable Portfolios, Inc. is a part of American Century
Investments, a family of funds that includes nearly 70 no-load mutual funds
covering a variety of investment opportunities. Variable Portfolios offers its
shares only to insurance companies to fund the benefits of variable annuity or
variable life insurance contracts. One of the funds, VP Capital Appreciation, is
described in this Prospectus. Its investment objective is listed on page 2 of
this Prospectus. The other funds are described in separate prospectuses. You
should consult the prospectus of the separate account of the specific insurance
product that accompanies this Prospectus to see which series of Variable
Portfolios are available for purchase for such insurance product.

Shares of the fund may be purchased only by insurance companies for the
purpose of funding variable annuity or variable life insurance contracts. This
Prospectus should be read in conjunction with the prospectus of the separate
account of the specific insurance product that accompanies this Prospectus.

This Prospectus gives you information about the fund that you should know
before investing. Please read this Prospectus carefully and retain it for future
reference.

Additional information is included in the Statement of Additional
Information dated May 1, 1998, and filed with the Securities and Exchange
Commission. It is incorporated into this Prospectus by reference. To obtain a
copy, without charge, call or write:

AMERICAN CENTURY INVESTMENTS
4500 Main Street * P.O. Box 419385
Kansas City, Missouri 64141-6385 * 1-800-345-3533
International calls: 816-531-5575
Telecommunications Device for the Deaf:
1-800-345-1833 * In Missouri: 816-444-3038

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.

PROSPECTUS 1

INVESTMENT OBJECTIVE OF THE FUND

AMERICAN CENTURY VP CAPITAL APPRECIATION

VP Capital Appreciation seeks capital growth. The fund will seek to achieve
its investment objective by investing primarily in common stocks that are
considered by management to have better-than-average prospects for appreciation

There is no assurance that the fund will achieve its investment objective.

NO PERSON IS AUTHORIZED BY THE FUND TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATION OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS OR IN OTHER PRINTED
OR WRITTEN MATERIAL ISSUED BY OR ON BEHALF OF THE FUND, AND YOU SHOULD NOT RELY
ON ANY OTHER INFORMATION OR REPRESENTATION.

2 INVESTMENT OBJECTIVE AMERICAN CENTURY INVESTMENTS

TABLE OF CONTENTS

Investment Objective of the Fund .......................................... 2
Financial Highlights ...................................................... 4

INFORMATION REGARDING THE FUND

Investment Policies of the Fund ........................................... 5
Shareholders of Variable Portfolios ....................................... 5
Other Investment Practices, Their Characteristics
and Risks ............................................................... 5
Repurchase Agreements ............................................... 5
Foreign Securities .................................................. 6
Forward Currency Exchange Contracts ................................. 6
Derivative Securities ............................................... 7
Short Sales ......................................................... 7
When-Issued Securities .............................................. 8
Rule 144A Securities ................................................ 8
Portfolio Turnover .................................................. 8
Performance Advertising ................................................... 8

ADDITIONAL INFORMATION YOU SHOULD KNOW

Share Price ............................................................... 10
Purchase and Redemption of Shares ................................... 10
When Share Price Is Determined ...................................... 10
How Share Price Is Determined ....................................... 10
Distributions ............................................................. 11
Taxes ..................................................................... 11
Management ................................................................ 11
Investment Management ............................................... 11
Code of Ethics ...................................................... 11
Transfer and Administrative Services ................................ 12
Distribution of Fund Shares ............................................... 12
Further Information About American Century ................................ 12

PROSPECTUS TABLE OF CONTENTS 3

<TABLE>

<CAPTION>
FINANCIAL HIGHLIGHTS
VP CAPITAL APPRECIATION

The Financial Highlights for the fiscal year ended December 31, 1997, have
been audited by Deloitte & Touche, LLP independent auditors, whose report
thereon appears in the fund's annual report, which is incorporated by reference
into the Statement of Additional Information. The annual report contains
additional performance information and will be made available upon request and
without charge. The Financial Highlights for the fiscal years ended on or before
December 31, 1996, have been audited by other independent auditors. The
information presented is for a share outstanding throughout the years ended
December 31, except as noted.

1997 1996 1995 1994 1993 1992 1991 1990 1989 1988

PER-SHARE DATA

Net Asset Value,
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Beginning of Year ............. $10.24 $12.06 $9.21 $9.32 $8.47 $8.64 $6.16 $6.24 $5.11 $5.29
-------- -------- -------- -------- -------- -------- -------- -------- -------- --------
Income From
Investment Operations

Net Investment
Income (Loss) ............... (0.05)(1) (0.06)(1) (0.02) 0.01 0.03 0.02 0.04 0.06 0.06 0.06

Net Realized and
Unrealized Gain
(Loss) on Investment
Transactions ................ (0.30) (0.40) 2.88 (0.12) 0.84 (0.14) 2.51 (0.14) 1.41 (0.18)
-------- -------- -------- -------- -------- -------- -------- -------- -------- --------
Total From
Investment Operations ....... (0.35) (0.46) 2.86 (0.11) 0.87 (0.12) 2.55 (0.08) 1.47 (0.12)
-------- -------- -------- -------- -------- -------- -------- -------- -------- --------
Distributions

From Net Investment Income .. -- -- (0.01) -- (0.02) (0.05) (0.07) -- (0.06) (0.06)

From Net Realized Gains
on Investment Transactions .. (0.21) (1.36) -- -- -- -- -- -- (0.28) --
-------- -------- -------- -------- -------- -------- -------- -------- -------- --------
Total Distributions ......... (0.21) (1.36) (0.01) -- (0.02) (0.05) (0.07) -- (0.34) (0.06)
-------- -------- -------- -------- -------- -------- -------- -------- -------- --------
Net Asset Value, End of Year .. $9.68 $10.24 $12.06 $9.21 $9.32 $8.47 $8.64 $6.16 $6.24 $5.11
======== ======== ======== ======== ======== ======== ======== ======== ======== ========
TOTAL RETURN(2) ............. (3.26)% (4.32)% 31.10% (1.17)% 10.30% (1.33)% 41.86% (1.24)% 28.70% (2.26)%

RATIOS/SUPPLEMENTAL DATA

Ratio of Operating Expenses
to Average Net Assets ......... 1.00% 1.00% 0.99% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00%

Ratio of Net Investment Income
(Loss) to Average Net Assets .. (0.53)% (0.59)% (0.23)% 0.11% 0.35% 0.32% 0.62% 1.46% 1.53% 1.95%

Portfolio Turnover Rate ....... 107% 182% 147% 115% 87% 135% 182% 271% 228% 354%

Average Commission
Paid per Share
of Equity Security Traded ..... $0.0316 $0.0326 $0.0370 --(3) --(3) --(3) --(3) --(3) --(3) --(3)

Net Assets, End
of Year (in millions) ......... $594 $1,314 $1,461 $1,003 $756 $415 $256 $97 $35 $6
</TABLE>
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(1) Computed using average shares outstanding throughout the period.

(2) Total return assumes reinvestment of dividends and capital gains
distributions, if any.

(3) Disclosure of average commission paid per share of equity security traded
was not required prior to the year ended December 31, 1995.

4 FINANCIAL HIGHLIGHTS AMERICAN CENTURY INVESTMENTS

INFORMATION REGARDING THE FUND

INVESTMENT POLICIES OF THE FUND

American Century Variable Portfolios ("Variable Portfolios") has adopted
certain investment restrictions applicable to the fund that are set forth in the
Statement of Additional Information. Those restrictions, as well as the
investment objective of the fund identified on page 2 of this Prospectus, and
any other investment policies designated as "fundamental" in this Prospectus or
in the Statement of Additional Information, cannot be changed without
shareholder approval. The fund has implemented additional investment policies
and practices to guide its activities in the pursuit of its investment
objective. These policies and practices, which are described throughout this
Prospectus, are not designated as fundamental policies and may be changed
without shareholder approval.

VP Capital Appreciation seeks capital growth. The fund will seek to achieve
its investment objective by investing in common stocks (including securities
convertible into common stocks and other equity equivalents) and other
securities that meet certain fundamental and technical standards of selection
and have, in the opinion of the fund's investment manager, better than average
potential for appreciation. The fund tries to stay fully invested in such
securities, regardless of the movement of stock prices generally.

The fund may invest in cash and cash equivalents temporarily or when it is
unable to find securities meeting its criteria of selection. It may purchase
securities only of companies that have a record of at least three years'
continuous operation.

SHAREHOLDERS OF VARIABLE PORTFOLIOS

Variable Portfolios will offer its shares only to insurance companies for
the purpose of funding variable annuity or variable life insurance contracts.
Although Variable Portfolios does not foresee any disadvantages to contract
owners due to the fact that it offers its shares as an investment medium for
both variable annuity and variable life products, the interests of various
contract owners participating in the funds of Variable Portfolios might at some
time be in conflict due to future differences in tax treatment of variable
products or other considerations. Consequently, Variable Portfolios' Board of
Directors will monitor events in order to identify any material irreconcilable
conflicts that may possibly arise and to determine what action, if any, should
be taken in response to such conflicts. If a conflict were to occur, an
insurance company separate account might be required to withdraw its investments
in the fund and the fund might be forced to sell securities at disadvantageous
prices to fund such withdrawal.

OTHER INVESTMENT PRACTICES, THEIR CHARACTERISTICS
AND RISKS

For additional information, see "Investment Restrictions Applicable to all
Series of Shares" in the Statement of Additional Information.

REPURCHASE AGREEMENTS

The fund may invest in repurchase agreements when such transactions present
an attractive short-term return on cash that is not otherwise committed to the
purchase of securities pursuant to the investment policy of the fund.

A repurchase agreement occurs when, at the time the fund purchases an
interest-bearing obligation, the seller (a bank or broker-dealer registered
under the Securities Exchange Act of 1934) agrees to repurchase it on a
specified date in the future at an agreed-upon price. The repurchase price
reflects an agreed-upon interest rate during the time the fund's money is
invested in the security.

PROSPECTUS INFORMATION REGARDING THE FUND 5

seeks relief under the bankruptcy laws, the disposition of the collateral may be
delayed or limited. To the extent the value of the security decreases, the fund
could experience a loss.

The fund will limit repurchase agreement transactions to securities issued
by the U.S. government, its agencies and instrumentalities, and will enter into
such transactions only with those commercial banks and securities dealers who
are deemed creditworthy pursuant to criteria adopted by the fund's Board of
Directors.

FOREIGN SECURITIES

The fund may invest an unlimited amount of its assets in the securities of
foreign issuers when these securities meet its standards of selection. The fund
may make such investments either directly in foreign securities, or indirectly
by purchasing depositary receipts or depositary shares or similar instruments
(collectively "depositary receipts") for foreign securities. Depositary receipts
are securities listed on exchanges or quoted in the over-the-counter markets in
one country but represent shares of issuers domiciled in another country.
Depositary receipts may be sponsored or unsponsored. Direct investments in
foreign securities may be made either on foreign securities exchanges or in the
over-the-counter markets.

Investments in foreign securities may present certain risks, including those
resulting from fluctuations in currency exchange rates, future political and
economic developments, currency restrictions and devaluations, securities
clearance and settlement procedures, exchange control regulations, reduced
availability of public information concerning issuers, and the lack of uniform
accounting, auditing and financial reporting standards and other regulatory
practices and requirements comparable to those applicable to domestic issuers.

FORWARD CURRENCY EXCHANGE CONTRACTS

Some of the foreign securities held by the fund may be denominated in
foreign currencies. Other securities, such as depositary receipts, may be
denominated in U.S. dollars or the currency of the country where issued (if not
U.S. dollars), but have a value that is dependent upon the performance of a
foreign security, as valued in the currency of its home country. As a result,
the value of the fund's portfolio may be affected by changes in the exchange
rate between foreign currencies and the U.S. dollar, as well as by changes in
the market value of the securities themselves. The performance of foreign
currencies relative to the U.S. dollar may be an important factor in the overall
performance of the fund.

To protect against adverse movements in exchange rates between currencies,
the fund may, for hedging purposes only, enter into forward currency exchange
contracts. A forward currency exchange contract obligates the fund to purchase
or sell a specific currency at a future date at a specific price.

The fund may elect to enter into a forward currency exchange contract with
respect to a specific purchase or sale of a security, or with respect to the
fund's portfolio positions generally.

By entering into a forward currency exchange contract with respect to the
specific purchase or sale of a security denominated in a foreign currency, the
fund can "lock in" an exchange rate between the trade and settlement dates for
that purchase or sale. This practice is sometimes referred to as "transaction
hedging." The fund may enter into transaction hedging contracts with respect to
all or a substantial portion of its trades.

When the manager believes that a particular currency may decline in value
compared to the U.S. dollar, the fund may enter into foreign currency exchange
contracts to sell the value of some or all of the fund's portfolio securities
either denominated in, or whose value is tied to, that currency. This practice
is sometimes referred to as "portfolio hedging." The fund may not enter into a
portfolio hedging transaction where the fund would be obligated to deliver an
amount of foreign currency in excess of the aggregate value its portfolio
securities or other assets denominated in, or whose value is tied to, that
currency.

The fund will make use of portfolio hedging to the extent deemed appropriate
by the manager. However, it is anticipated that the fund will enter into
portfolio hedges much less frequently than transaction hedges.

6 INFORMATION REGARDING THE FUND AMERICAN CENTURY INVESTMENTS

contract. Those assets will be valued at market daily, and if the value of the
segregated securities declines, additional cash or securities will be added so
that the value of the account is not less than the amount of the fund's
commitment. At any given time, no more than 10% of the fund's assets will be
committed to a segregated account in connection with portfolio hedging
transactions.

Predicting the relative future values of currencies is very difficult, and
there is no assurance that any attempt to protect the fund against adverse
currency movements through the use of forward currency exchange contracts will
be successful. In addition, the use of forward currency exchange contracts tends
to limit the potential gains that might result from a positive change in the
relationship between the foreign currency and the U.S. dollar.

DERIVATIVE SECURITIES

To the extent permitted by its investment objective and policies, the fund
may invest in securities that are commonly referred to as "derivative"
securities. Generally, a derivative is a financial arrangement the value of
which is based on, or "derived" from, a traditional security, asset, or market
index. Certain derivative securities are more accurately described as
"index/structured securities." Index/structured securities are derivative
securities whose value or performance is linked to other equity securities (such
as depositary receipts), currencies, interest rates, indices or other financial
indicators (reference indices). The fund may not invest in an index/structured
security unless the reference index or the instrument to which it relates is an
eligible investment for the fund. For example, a security whose underlying value
is limited to the price of oil would not be a permissible investment because the
fund may not invest in oil and gas leases or futures.

The return on a derivative security may increase or decrease, depending upon
changes in the reference index or the instrument to which it relates.

There is a range of risks associated with derivative investments, including
but not limited to:

* the risk that the underlying security, interest rate, market index or
other financial asset will not move in the direction the portfolio
manager anticipates;

* the possibility that there will be no liquid secondary market, or the
possibility that price fluctuation limits will be imposed by the
relevant exchange, either of which will make it difficult or impossible
to close out a position when desired;

* the risk that adverse price movements in an instrument will result in a
loss substantially greater than a fund's initial investment; and

* the risk that the counterparty will fail to perform its obligations.

Because its performance is tied to a reference index, a fund investing in
index/structured securities, in addition to being exposed to the credit risk of
the issuer of the security, also will bear the market risk of changes in the
reference index.

The Board of Directors has approved the manager's policy regarding
investments in derivative securities. That policy specifies factors that must be
considered in connection with a purchase of derivative securities. The policy
also establishes a committee that must review certain proposed purchases before
the purchases can be made. The manager will report on fund activity in
derivative securities to the Board of Directors as necessary. In addition, the
Board will review the manager's policy for investments in derivative securities
annually.

SHORT SALES

The fund may engage in short sales if, at the time of the short sale, the
fund owns or has the right to acquire securities equivalent in kind and amount
to the securities being sold short. Such transactions allow the fund to hedge
against price fluctuations by locking in a sale price for securities it does not
wish to sell immediately.

The fund may make a short sale when it wants to sell the security it owns at
a current attractive price, but also wishes to defer recognition of gain or loss
for federal income tax purposes and for purposes of satisfying certain tests
applicable to regulated investment companies under the Internal Revenue Code and
Regulations.

PROSPECTUS INFORMATION REGARDING THE FUND 7

WHEN-ISSUED SECURITIES

The fund may sometimes purchase new issues of securities on a when-issued
basis without limit when, in the opinion of the investment manager, such
purchases will further the investment objective of the fund. The price of
when-issued securities is established at the time the commitment to purchase is
made. Delivery of and payment for these securities typically occur 15 to 45 days
after the commitment to purchase. Market rates of interest on debt securities at
the time of delivery may be higher or lower than those contracted for on the
when-issued security. Accordingly, the value of such security may decline prior
to delivery, which could result in a loss to the fund. A separate account
consisting of cash or high-quality liquid debt securities in an amount at least
equal to the when-issued commitments will be established and maintained with the
custodian. No income will accrue to the fund prior to delivery.

RULE 144A SECURITIES

The fund may, from time to time, purchase Rule 144A securities when they
present attractive investment opportunities that otherwise meet the fund's
criteria for selection. Rule 144A securities are securities that are privately
placed with and traded among qualified institutional investors rather than the
general public. Although Rule 144A securities are considered "restricted
securities," they are not necessarily illiquid.

With respect to securities eligible for resale under Rule 144A, the staff of
the SEC has taken the position that the liquidity of such securities in the
portfolio of a fund offering redeemable securities is a question of fact for the
Board of Directors to determine, such determination to be based upon a
consideration of the readily available trading markets and the review of any
contractual restrictions. The staff also acknowledges that, while the Board
retains ultimate responsibility, it may delegate this function to the manager.
Accordingly, the Board of Directors is responsible for developing and
establishing the guidelines and procedures for determining the liquidity of Rule
144A securities. As allowed by Rule 144A, the fund's Board of Directors has
delegated the day-to-day function of determining the liquidity of 144A
securities to the investment manager. The Board retains the responsibility to
monitor the implementation of the guidelines and procedures it has adopted.

Since the secondary market for such securities will be limited to certain
qualified institutional investors, their liquidity may be limited accordingly
and the fund may from time to time hold a Rule 144A security that is illiquid.
In such an event, the fund's manager will consider appropriate remedies to
minimize the effect on the fund's liquidity. The fund may not invest more than
15% of its assets in illiquid securities (securities that may not be sold within
seven days at approximately the price used in determining the net asset value of
fund shares.)

PORTFOLIO TURNOVER

The total portfolio turnover rate of the fund is shown in the Financial
Highlights table on page 4 of this Prospectus.

Investment decisions to purchase and sell securities are based on the
anticipated contribution of the security in question to the fund's investment
objective. The manager believes that the rate of portfolio turnover is
irrelevant when it determines a change is in order to achieve the objective and
accordingly, the annual portfolio turnover rate cannot be anticipated.

PERFORMANCE ADVERTISING

From time to time the fund (or the insurance companies that use the fund to
fund the benefits of variable annuity or variable life insurance contracts) may
advertise performance data. Fund performance may be shown by presenting one or
more performance measurements, including cumulative total return and average
annual total return.

8 INFORMATION REGARDING THE FUND AMERICAN CENTURY INVESTMENTS

pound return over a stated period of time that would have produced the fund's
cumulative total return over the same period if the fund's performance had
remained constant throughout.

The fund also may include in advertisements data comparing performance with
the performance of non-related investment media, published editorial comments
and performance rankings compiled by independent organizations (such as Lipper
Analytical Services, Inc. or Donoghue's Money Fund Report) and publications that
monitor the performance of mutual funds. Performance information may be quoted
numerically or may be represented in a table, graph or other illustration. In
addition, fund performance may be compared to well-known indices of market
performance including the S&P 500 Index, the Dow Jones Industrial Average,
Donoghue's Money Fund Average, the Shearson Lehman Intermediate Government Bond
Index, the constant maturity five-year U.S. Treasury Note Index and the Bank
Rate Monitor National Index of 2 (1)/(2) -year CD rates. Fund performance also
may be compared to the rankings prepared by Lipper Analytical Services, Inc.
Fund performance also may be compared, on a relative basis, to other funds in
our fund family. This relative comparison, which may be based upon historical
fund performance or historical or expected volatility or other fund
characteristics, may be presented numerically, graphically or in text.

All performance information advertised by the fund is historical in nature
and is not intended to represent or guarantee future results. The value of fund
shares, when redeemed, may be more or less than their original cost.

Performance figures advertised by the fund should not be used for
comparative purposes because these figures will not include charges and
deductions imposed by the insurance company separate account under the variable
annuity or variable life insurance contracts.

PROSPECTUS INFORMATION REGARDING THE FUND 9

ADDITIONAL INFORMATION YOU SHOULD KNOW

SHARE PRICE

PURCHASE AND REDEMPTION OF SHARES

For instructions on how to purchase and redeem shares, read the prospectus
of your insurance company separate account.

Shares of the fund are sold and redeemed by the fund at their net asset
value next determined after receipt by the insurance company separate account of
the order from the variable annuity or variable life insurance contract owner to
purchase or to redeem. There are no sales commissions or redemption charges.
However, certain sales or deferred sales charges and other charges may apply to
the variable annuity or life insurance contracts. Those charges are disclosed in
the separate account prospectus.

WHEN SHARE PRICE IS DETERMINED

The price of VP Capital Appreciation shares is also referred to as their net
asset value. Net asset value is determined by calculating the total value of the
fund's assets, deducting total liabilities and dividing the result by the number
of shares outstanding. Net asset value is determined at the close of regular
trading on each day that the New York Stock Exchange is open. Investments and
requests to redeem shares received by the separate account before the close of
business of the Exchange, usually 3 p.m. Central time, are effective, and will
receive the price determined, that day as of the close of the Exchange.
Investment, redemption and exchange requests received thereafter are effective
on, and receive the price determined as of the close of the Exchange on, the
next day the Exchange is open.

HOW SHARE PRICE IS DETERMINED

The valuation of assets for determining net asset value may be summarized as
follows:

The portfolio securities of the fund, except as otherwise noted, listed or
traded on a domestic securities exchange are valued at the last sale price on
that exchange. Portfolio securities primarily traded on foreign securities
exchanges generally are valued at the preceding closing values of such
securities on the exchange where primarily traded. If no sale is reported, or if
local convention or regulation so provides, the mean of the latest bid and asked
prices is used. Depending on local convention or regulation, securities traded
over-the-counter are priced at the mean of the latest bid and asked prices, or
at the last sale price. When market quotations are not readily available,
securities and other assets are valued at fair value as determined in accordance
with procedures adopted by the Board of Directors.

Debt securities not traded on a principal securities exchange are valued
through valuations obtained from a commercial pricing service or at the most
recent mean of the bid and asked prices provided by investment dealers in
accordance with procedures established by the Board of Directors.

The value of an exchange-traded foreign security is determined in its
national currency as of the close of trading on the foreign exchange on which it
is traded or as of the close of business of the New York Stock Exchange, if that
is earlier. That value is then converted to U.S. dollars at the prevailing
foreign exchange rate. Trading in securities on European and Far Eastern
securities exchanges and over-the-counter markets is normally completed at
various times before the close of business on each day that the New York Stock
Exchange is open.

If an event were to occur after the value of a security was established but
before the net asset value per share was determined that was likely to
materially change the net asset value, then that security would be valued at
fair value as determined in accordance with procedures adopted by the Board of
Directors.

Trading of these securities in foreign markets may not take place on every
New York Stock Exchange business day. In addition, trading may take place in
various foreign markets on Saturdays or on other days when the New York Stock
Exchange is not open and on which the fund's net asset value is not calculated.
Therefore, such calculation does not take place contemporaneously with the
determination of the prices of many of the portfolio securities used in such
calcu-

10 ADDITIONAL INFORMATION YOU SHOULD KNOW AMERICAN CENTURY INVESTMENTS

lation and the value of the fund's portfolio may be affected on days when shares
of the fund may not be purchased or redeemed.

DISTRIBUTIONS

In general, distributions from net investment income and net realized
securities gains, if any, 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 Internal Revenue Code, in all events in a manner consistent
with the provisions of the Investment Company Act. All distributions from the
fund will be reinvested in additional shares.

TAXES

The fund has elected to be taxed under Subchapter M of the Internal Revenue
Code, which means to the extent its income is distributed to shareholders, it
pays no income tax. For a discussion of the tax status of your variable
contract, refer to the prospectus of your insurance company separate account.

MANAGEMENT

INVESTMENT MANAGEMENT

Under the laws of the State of Maryland, the Board of Directors is
responsible for managing the business and affairs of the fund. Acting pursuant
to an investment management agreement entered into with the fund, American
Century Investment Management, Inc. serves as the manager of the fund. Its
principal place of business is American Century Tower, 4500 Main Street, Kansas
City, Missouri 64111. The manager has been providing investment advisory
services to investment companies and institutional investors since it was
founded in 1958.

The manager supervises and manages the investment portfolio of the fund and
directs the purchase and sale of its investment securities. It utilizes a team
of portfolio managers, assistant portfolio managers and analysts acting together
to manage the assets of the fund. The team meets regularly to review portfolio
holdings and to discuss purchase and sale activity. The team adjusts holdings in
the fund's portfolio as they deem appropriate in pursuit of the fund's
investment objectives. Individual portfolio manager members of the team may also
adjust portfolio holdings of the funds as necessary between team meetings.

The portfolio manager members of the VP Capital Appreciation team and their
work experience for the last five years are as follows:

HAROLD S. BRADLEY, Vice President and Portfolio Manager, joined American
Century in 1988. For the past ten years, Mr. Bradley has managed the global
equity, futures and foreign exchange trading activities for American Century.

LINDA K. PETERSON, Portfolio Manager, joined American Century in 1986. She
served as an Investment Analyst for American Century growth-oriented funds from
April 1994 until March 1998. She was promoted to Portfolio Manager in March
1998.

The activities of the manager are subject only to directions of the fund's
Board of Directors. The manager pays all the expenses of the fund except
brokerage, taxes, interest, fees and expenses of the non-interested person
directors (including counsel fees) and extraordinary expenses.

For the services provided to the fund, the manager receives an annual fee of
1% of the average net assets of the fund. On the first business day of each
month, each series of shares pays a management fee to the manager for the
previous month at the rate specified. The fee for the previous month is
calculated by multiplying the applicable fee for such series by the aggregate
average daily closing value of the series' net assets during the previous month,
and further multiplying that product by a fraction, the numerator of which is
the number of days in the previous month and the denominator of which is 365
(366 in leap years).

CODE OF ETHICS

The fund and the manager have adopted a Code of Ethics that restricts
personal investing practices by employees of the manager and its affiliates.
Among other provisions, the Code of Ethics requires that employees with access
to information about the purchase or sale of securities in the fund's portfolio
obtain preclearance before executing personal trades. With respect to Portfolio
Managers and other investment personnel, the Code of Ethics prohibits
acquisition of securities in an initial public offering, as well as profits
derived from the purchase and sale of the same security within 60 calendar days.
These provi-

PROSPECTUS ADDITIONAL INFORMATION YOU SHOULD KNOW 11

sions are designed to ensure that the interests of fund shareholders come before
the interests of the people who manage those funds.

TRANSFER AND ADMINISTRATIVE SERVICES

Certain recordkeeping and administrative services that would otherwise be
performed by the transfer agent may be performed by the insurance company that
purchases the fund's shares, and the manager may pay the insurance company for
such services.

The manager and the transfer agent are both wholly owned by American Century
Companies, Inc. James E. Stowers Jr., chairman of the fund's Board of Directors,
controls American Century Companies by virtue of his ownership of a majority of
its common stock.

Pursuant to a Sub-Administration Agreement with the manager, Funds
Distributor, Inc. (FDI) serves as the Co-Administrator for the fund. FDI is
responsible for (i) providing certain officers of the fund and (ii) reviewing
and filing marketing and sales literature on behalf of the fund. The fees and
expenses of FDI are paid by the manager.

DISTRIBUTION OF FUND SHARES

The fund's shares are distributed by FDI, a registered broker-dealer. FDI is
a wholly-owned indirect subsidiary of Boston Institutional Group, Inc. FDI's
principal business address is 60 State Street, Suite 1300, Boston, Massachusetts
02109. The manager pays all expenses for promoting sales of, and distributing
the shares offered by this Prospectus.

Investors may open accounts with American Century only through the
distributor. All purchase transactions in the fund offered by this Prospectus
are processed by the transfer agent, which is authorized to accept any
instructions relating to fund accounts. All purchase orders must be accepted by
the distributor. All fees and expenses of FDI in acting as distributor for the
fund are paid by the manager.

On November 10, 1997, American Century Variable Portfolios, Inc. received a
copy of a complaint filed against Nationwide Life Insurance Company in which
American Century Mutual Funds, Inc., American Century Investment Services, Inc.,
American Century Investment Management, Inc., American Century Variable
Portfolios, Inc., and American Century Investment Management International LTD
were named as co-defendants. The suit was filed in The United States District
Court for the Southern District of Texas, Galveston Division, on October 31,
1997 and alleges a variety of state and federal complaints against Nationwide
and American Century in connection with the sale of a Nationwide insurance
product that utilizes VP Capital Appreciation as an underlying investment
vehicle. The manager believes the allegations are without merit and intends to
defend the litigation vigorously.

FURTHER INFORMATION ABOUT AMERICAN CENTURY

American Century Variable Portfolios, Inc., the issuer of the fund, was
organized as a Maryland corporation on June 4, 1987. It is a diversified,
open-end management investment company. Its business and affairs are managed by
its officers under the direction of its Board of Directors.

The principal office of the fund is American Century Tower, 4500 Main
Street, P.O. Box 419385, Kansas City, Missouri 64141-6385. All inquiries may be
made by mail to that address or by telephone to 816-531-5575.

American Century Variable Portfolios, Inc. issues six series of common stock
with a par value of $.01 per share. Each series is commonly referred to as a
fund. The assets belonging to each series of shares are held separately by the
custodian. Each share of each series, when issued, is fully paid and
non-assessable.

Each share, irrespective of series, is entitled to one vote for each dollar
of net asset value applicable to such share on all questions, except for those
matters which must be voted on separately by the series of shares affected.
Matters affecting only one series are voted upon only by that series.

Shares have non-cumulative voting rights, which means that holders of more
than 50% of the votes cast in an election of directors can elect all of the
directors if they choose to do so, and, in such event, the holders of the
remaining votes will not be able to elect any person or persons to the Board of
Directors.

12 ADDITIONAL INFORMATION YOU SHOULD KNOW AMERICAN CENTURY INVESTMENTS

An insurance company issuing a variable contract invested in shares issued
by the fund will request voting instructions from contract holders and will vote
shares in proportion to the voting instructions received.

In the event of the complete liquidation or dissolution of the fund,
shareholders of each series of shares shall be entitled to receive, pro rata,
all of the assets less the liabilities of that series.

WE RESERVE THE RIGHT TO CHANGE ANY OF OUR POLICIES, PRACTICES AND PROCEDURES
DESCRIBED IN THIS PROSPECTUS, INCLUDING THE STATEMENT OF ADDITIONAL INFORMATION,
WITHOUT SHAREHOLDER APPROVAL EXCEPT IN THOSE INSTANCES WHERE SHAREHOLDER
APPROVAL IS EXPRESSLY REQUIRED.

PROSPECTUS ADDITIONAL INFORMATION YOU SHOULD KNOW 13

P.O. BOX 419385
KANSAS CITY, MISSOURI
64141-6385

INSTITUTIONAL SERVICES:
1-800-345-3533 OR 816-531-5575

TELECOMMUNICATIONS DEVICE FOR THE DEAF:
1-800-345-1833 OR 816-444-3038

FAX: 816-340-4360

www.americancentury.com

[american century logo(reg.sm)]
American
Century(reg.tm)

9803 [recycled logo]
SH-BKT-11942 Recycled
<PAGE>
PROSPECTUS

[american century logo(reg.sm)]
American
Century(reg.tm)

MAY 1, 1998

AMERICAN CENTURY
VARIABLE
PORTFOLIOS, INC.

VP Value

PROSPECTUS
MAY 1, 1998

VP Value

AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.

American Century Variable Portfolios, Inc. is a part of American Century
Investments, a family of funds that includes nearly 70 no-load mutual funds
covering a variety of investment opportunities. Variable Portfolios offers its
shares only to insurance companies to fund the benefits of variable annuity or
variable life insurance contracts. One of the funds, VP Value, is described in
this Prospectus. Its investment objective is listed on page 2 of this
Prospectus. The other funds are described in separate prospectuses. You should
consult the prospectus of the separate account of the specific insurance product
that accompanies this Prospectus to see which series of Variable Portfolios are
available for purchase for such insurance product.

This Prospectus gives you information about the fund that you should know
before investing. Please read this Prospectus carefully and retain it for future
reference.

PROSPECTUS 1

INVESTMENT OBJECTIVE OF THE FUND

AMERICAN CENTURY VP VALUE

VP Value seeks long-term capital growth. Income is a secondary objective.
The fund will seek to achieve its investment objective by investing in
securities that management believes to be undervalued at the time of purchase.

There is no assurance that the fund will achieve its investment objective.

2 INVESTMENT OBJECTIVE AMERICAN CENTURY INVESTMENTS

TABLE OF CONTENTS

Investment Objective of the Fund .......................................... 2
Financial Highlights ...................................................... 4

INFORMATION REGARDING THE FUND

Investment Policies of the Fund ........................................... 5
Shareholders of Variable Portfolios ....................................... 6
Other Investment Practices, Their Characteristics
and Risks .............................................................. 6
Foreign Securities .................................................... 6
Equity Securities ..................................................... 6
Forward Currency Exchange Contracts ................................... 7
Portfolio Turnover .................................................... 7
Repurchase Agreements ................................................. 8
Futures Contracts ..................................................... 8
Derivative Securities ................................................. 9
When-Issued Securities ................................................ 9
Short Sales ........................................................... 9
Rule 144A Securities .................................................. 10
Performance Advertising ................................................... 10

ADDITIONAL INFORMATION YOU SHOULD KNOW

Share Price ............................................................... 11
Purchase and Redemption of Shares ..................................... 11
When Share Price is Determined ........................................ 11
How Share Price is Determined ......................................... 11
Distributions ............................................................. 12
Taxes ..................................................................... 12
Management ................................................................ 12
Investment Management ................................................. 12
Code of Ethics ........................................................ 12
Transfer and Administrative Services .................................. 13
Distribution of Fund Shares ............................................... 13
Further Information About American Century ................................ 13

PROSPECTUS TABLE OF CONTENTS 3

FINANCIAL HIGHLIGHTS

VP VALUE

The Financial Highlights for the fiscal year ended December 31, 1997, have
been audited by Deloitte & Touche LLP independent auditors, whose report thereon
appears in the fund's annual report, which is incorporated by reference into the
Statement of Additional Information. The annual report contains additional
performance information and will be made available upon request and without
charge. The Financial Highlights for the period ended on or before December 31,
1996, has been audited by other independent auditors. The information presented
is for a share outstanding throughout the years ended December 31, except as
noted.

1997 1996(1)

PER-SHARE DATA

Net Asset Value, Beginning of Period .......... $5.58 $5.00
-------- --------

Income From Investment Operations

Net Investment Income ...................... 0.07 0.05

Net Realized and Unrealized Gain
on Investment Transactions ................. 1.37 0.56
-------- --------

Total From Investment Operations ........... 1.44 0.61
-------- --------

Distributions

From Net Investment Income ................. (0.04) (0.03)

From Net Realized Gains
on Investment Transactions ................. (0.05) --
-------- --------

Total Distributions ........................ (0.09) (0.03)
-------- --------

Net Asset Value, End of Period ................ $6.93 $5.58
======== ========

Total Return(2) ............................ 26.08% 12.28%

RATIOS/SUPPLEMENTAL DATA

Ratio of Operating Expenses
to Average Net Assets ...................... 1.00% 1.00%(3)

Ratio of Net Investment
Income to Average Net Assets ............... 1.60% 1.98%(3)

Portfolio Turnover Rate .................... 138% 49%

Average Commission Paid per
Share of Equity Security Traded ............ $0.0369 $0.0271

Net Assets, End of
Period (in thousands) ......................$188,015 $23,894
- ----------

(1) May 1, 1996 (inception) through December 31, 1996.

(2) Total return assumes reinvestment of dividends and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized.

(3) Annualized.

4 FINANCIAL HIGHLIGHTS AMERICAN CENTURY INVESTMENTS

INFORMATION REGARDING THE FUND

INVESTMENT POLICIES OF THE FUND

American Century Variable Portfolios, Inc. ("Variable Portfolios") has
adopted certain investment restrictions applicable to the fund that are set
forth in the Statement of Additional Information. Those restrictions, as well as
the investment objective of the fund identified on page 2 of this Prospectus,
and any other investment policies designated as "fundamental" in this Prospectus
or in the Statement of Additional Information, cannot be changed without
shareholder approval. The fund has implemented additional investment policies
and practices to guide its activities in the pursuit of its investment
objective. These policies and practices, which are described throughout this
Prospectus, are not designated as fundamental policies and may be changed
without shareholder approval.

VP Value seeks long-term capital growth. Income is a secondary objective.
The fund will seek to achieve its investment objective by investing primarily in
equity securities of well-established companies with intermediate-to-large
market capitalizations that are believed by management to be undervalued at the
time of purchase.

Securities may be undervalued because they are temporarily out of favor in
the market due to market decline, poor economic conditions, or actual or
anticipated unfavorable developments affecting the issuer of the security or its
industry, or because the market has overlooked them. Under normal market
conditions, the fund expects to invest at least 80% of the value of its total
assets in equity securities, which includes equity equivalents (see "Other
Investment Practices, Their Characteristics and Risks -- Equity Securities,"
page 6). The fund's investments will typically be characterized by lower
price-to-earnings, price-to-cash flow, price-to-debt adjusted cash flow and/or
price-to-book value ratios relative to the equity market in general. Its
investments also may have above-average current dividend yields.

It is management's intention that the fund will primarily consist of
domestic equity securities. However, the fund also may invest in other types of
domestic or foreign securities consistent with the accomplishment of the fund's
objective. The other securities the fund may invest in are convertible
securities (see "Other Investment Practices, Their Characteristics and Risks --
Equity Securities," page 6), preferred stocks, bonds, notes and debt securities
of companies and debt obligations of governments and their agencies. Investments
in these securities will be made when the manager believes that the total return
potential on these securities equals or exceeds the potential return on common
stocks.

The fund's holdings will be spread among industry groups that meet its
investment criteria to help reduce certain risks inherent in common stock
investments. These investments will primarily be securities listed on major
exchanges or traded in the over-the-counter markets.

With the exception of convertible securities, the fund will limit purchases
of debt securities to "investment grade" obligations, which means that, at the
time of purchase, such obligations are rated within the four highest categories
by a nationally recognized statistical rating organization [for example, at
least Baa by Moody's Investors Service, Inc. (Moody's) or BBB by Standard &
Poor's Corporation (S&P)], or, if not rated, are of equivalent investment
quality as determined by management. There is no limit on the amount of
investments that can be made in securities rated in a particular investment
grade ratings category. According to Moody's, bonds rated Baa are medium-grade
and possess some speculative characteristics. A BBB rating by S&P indicates S&
P's belief that a security exhibits a satisfactory degree of safety and capacity
for repayment but is more vulnerable to adverse economic conditions or changing
circumstances.

"High yield" securities, sometimes referred to as "junk bonds," are higher
risk, non-convertible debt obligations that are rated below investment grade
securities, or are unrated, but with similar credit quality.

In addition to other factors that will affect its value, the value of a
fund's investments in fixed income securities will change as prevailing interest
rates

PROSPECTUS INFORMATION REGARDING THE FUND 3

change. In general, the prices of such securities vary inversely with interest
rates. As prevailing interest rates fall, the prices of bonds and other
securities that trade on a yield basis rise. When prevailing interest rates
rise, bond prices fall. These changes in value may, depending upon the
particular amount and type of fixed income securities holdings of a fund, impact
the net asset value of the fund's shares.

Notwithstanding the fact the fund will primarily invest in equity
securities, under exceptional market or economic conditions, the fund may
temporarily invest all or a substantial portion of its assets in cash or
investment grade short-term securities (denominated in U.S. dollars or foreign
currencies).

To the extent that the fund assumes a defensive position, it will not be
investing for capital growth.

SHAREHOLDERS OF VARIABLE PORTFOLIOS

Variable Portfolios will offer its shares only to insurance companies for
the purpose of funding variable annuity or variable life insurance contracts.
Although Variable Portfolios does not foresee any disadvantages to contract
owners due to the fact that it offers its shares as an investment medium for
both variable annuity and variable life products, the interests of various
contract owners participating in the funds of Variable Portfolios might, at some
time, be in conflict due to future differences in tax treatment of variable
products or other considerations. Consequently, Variable Portfolios' Board of
Directors will monitor events in order to identify any material irreconcilable
conflicts that may possibly arise and to determine what action, if any, should
be taken in response to such conflicts. If a conflict were to occur, an
insurance company separate account might be required to withdraw its investments
in the fund and the fund might be forced to sell securities at disadvantageous
prices to fund such withdrawal.

OTHER INVESTMENT PRACTICES, THEIR CHARACTERISTICS
AND RISKS

For additional information, see "Investment Restrictions Applicable to all
Series of Shares" in the Statement of Additional Information.

FOREIGN SECURITIES

The fund may invest up to 25% of its assets in the securities of foreign
issuers, including debt securities of foreign governments and their agencies,
when these securities meet its standards of selection. The principal business
activities of such issuers will be located in developed countries.

The fund may make such investments either directly in foreign securities or
indirectly by purchasing depositary receipts or depositary shares of similar
instruments (collectively "depositary receipts") for foreign securities.
Depositary receipts are securities listed on exchanges or quoted in the
over-the-counter markets in one country but represent shares of issuers
domiciled in another country. Depositary receipts may be sponsored or
unsponsored. Direct investments in foreign securities may be made either on
foreign securities exchanges or in the over-the-counter markets.

Subject to its investment objective and policies, the fund may invest in
common stocks, convertible securities, preferred stocks, bonds, notes and other
debt securities of foreign issuers and debt securities of foreign governments
and their agencies. The credit quality standards applicable to domestic
securities purchased by the fund are also applicable to its foreign securities
investments.

Investments in foreign securities may present certain risks, including those
resulting from fluctuations in currency exchange rates, future political and
economic developments, reduced availability of public information concerning
issuers, securities clearance and settlement procedures, and the lack of uniform
accounting, auditing and financial reporting standards and other regulatory
practices and requirements comparable to those applicable to domestic issuers.

EQUITY SECURITIES

In addition to investing in common stocks, the fund may invest in other
equity securities and equity equivalents. Other equity securities and equity
equivalents include securities that permit the fund to receive an equity
interest in an issuer, the opportunity to acquire an equity interest in an
issuer, or the opportunity to receive a return on its investment that permits
the fund to benefit from the growth over time in the equity of an issuer.
Examples of equity securities and equity equivalents include preferred stock,
convertible preferred stock and convertible debt securities.

The fund will limit its purchase of convertible debt securities to those
that, at the time of purchase, are

6 INFORMATION REGARDING THE FUND AMERICAN CENTURY INVESTMENTS

rated at least B- by S&P or B3 by Moody's, or if not rated by S&P or Moody's are
of equivalent investment quality as determined by management. Debt securities
rated below the four highest categories are not considered "investment grade"
obligations. These securities have speculative characteristics and present more
credit risk than investment grade obligations. For a description of the S&P and
Moody's ratings categories, see "An Explanation of Fixed Income Securities
Ratings," in the Statement of Additional Information. Equity equivalents may
also include securities whose value or return is derived from the value or
return of a different security. Depository receipts are an example of the type
of derivative security in which the fund might invest.

FORWARD CURRENCY EXCHANGE CONTRACTS

Some of the foreign securities held by the fund may be denominated in
foreign currencies. Other securities, such as depositary receipts, may be
denominated in U.S. dollars but have a value that is dependent on the
performance of a foreign security, as valued in the currency of its home
country. As a result, the value of the fund's portfolio may be affected by
changes in the exchange rate between foreign currencies and the U.S. dollar, as
well as by changes in the market value of the securities themselves. The
performance of foreign currencies relative to the U.S. dollar may be a factor in
the fund's overall performance.

The fund may elect to enter into a forward currency exchange contract with
respect to a specific purchase or sale of a security, or with respect to the
fund's portfolio positions generally.

When the manager believes that a particular currency may decline in value
compared to the U.S. dollar, the fund may enter into forward currency exchange
contracts to sell the value of some or all of the fund's portfolio securities
either denominated in, or whose value is tied to, that currency. This practice
is sometimes referred to as "portfolio hedging." The fund may not enter into a
portfolio hedging transaction where the fund would be obligated to deliver an
amount of foreign currency in excess of the aggregate value of its portfolio
securities or other assets denominated in, or whose value is tied to, that
currency.

If the fund enters into a forward currency exchange contract, the fund, when
required, will instruct its custodian bank to segregate cash or liquid
high-grade securities in a separate account in an amount sufficient to cover its
obligation under the contract. Those assets will be valued at market daily, and
if the value of the segregated securities declines, additional cash or
securities will be added so that the value of the account is not less than the
amount of the fund's commitment. At any given time, no more than 10% of a fund's
assets will be committed to a segregated account in connection with portfolio
hedging transactions.

PORTFOLIO TURNOVER

The total portfolio turnover rate of the fund is shown in the Financial
Highlights table on page 4 of this Prospectus.

PROSPECTUS INFORMATION REGARDING THE FUND 7

in order to achieve the objective and accordingly, the annual portfolio turnover
rate cannot be anticipated.

REPURCHASE AGREEMENTS

The fund may invest up to 20% of its assets in repurchase agreements when
such transactions present an attractive short-term return on cash that is not
otherwise committed to the purchase of securities pursuant to the fund's
investment policies.

A repurchase agreement occurs when, at the time the fund purchases an
interest-bearing obligation, the seller (a bank or broker-dealer registered
under the Securities Exchange Act of 1934) agrees to sell it back on a specified
date in the future at an agreed-upon price. The repurchase price reflects an
agreed-upon interest rate during the time the fund's money is invested in the
security.

Since the security purchased constitutes security for the repurchase
obligation, a repurchase agreement can be considered a loan collateralized by
the security purchased.

The fund's risk is the ability of the seller to pay the agreed-upon
repurchase price on the repurchase date. If the seller defaults, the fund may
incur costs in disposing of the collateral, which would reduce the amount
realized thereon. If the seller seeks relief under the bankruptcy laws, the
disposition of the collateral may be delayed or limited. To the extent the value
of the security decreases, the fund could experience a loss.

The fund will not invest more than 15% of its assets in repurchase
agreements maturing in more than seven days.

FUTURES CONTRACTS

The fund may enter into domestic stock futures contracts. A futures contract
is an agreement to take or make delivery of an amount of cash based on the
difference between the value of the index at the beginning and at the end of the
contract period. Rather than actually purchasing the securities of an index, the
manager may purchase a futures contract, which reflects the value of such
underlying securities. For example, S&P 500 futures reflect the value of the
underlying companies that comprise the S&P 500 Composite Stock Price Index. If
the aggregate market value of the underlying index securities increases or
decreases during the contract period, the value of the S&P 500 futures can be
expected to reflect such increase or decrease. As a result, the manager is able
to expose to the equity markets cash that is maintained by the fund to meet
anticipated redemptions or held for future investment opportunities. Because
futures generally settle within a day from the date they are closed out
(compared with three days for the types of equity securities primarily invested
in by the funds) the manager believes that this use of futures allows the fund
to effectively be fully invested in equity securities while maintaining the
liquidity needed by the fund.

When the fund enters into a futures contract, it must make deposit of cash
or high-quality debt securities, known as "initial margin," as partial security
for its performance under the contract. As the value of the index fluctuates,
the parties to the contract are required to make additional margin payments,
known as "variation margin," to cover any additional obligation they may have
under the contract. Assets set aside by the fund as initial or variation margin
may not be disposed of so long as the fund maintains the contract.

The fund may not purchase leveraged futures. The fund will deposit in a
segregated account with its custodian bank cash or high-quality debt securities
in an amount equal to the fluctuating market value of the futures contracts it
has purchased, less any margin deposited on its position. The fund will only
invest in exchange-traded futures. In addition, the value of index futures
contracts purchased by a fund may not exceed 5% of the fund's total assets.

8 INFORMATION REGARDING THE FUND AMERICAN CENTURY INVESTMENTS

DERIVATIVE SECURITIES

To the extent permitted by its investment objective and policies, the fund
may invest in securities that are commonly referred to as "derivative"
securities. Generally, a derivative is a financial arrangement the value of
which is based on, or "derived" from, a traditional security, asset, or market
index. Certain derivative securities are more accurately described as
"index/structured" securities. Index/structured securities are derivative
securities whose value or performance is linked to other equity securities (such
as depositary receipts or S&P 500 futures), currencies, interest rates, indices
or other financial indicators (reference indices). The fund may not invest in an
index/structured security unless the reference index or the instrument to which
it relates is an eligible investment for the fund. For example, a security whose
underlying value is linked to the price of oil would not be a permissible
investment because the fund may not invest in oil and gas leases or futures.

The return on a derivative security may increase or decrease, depending upon
changes in the reference index or the instrument to which it relates.

There is a range of risks associated with derivative investments, including
but not limited to:

o the risk that the underlying security, interest rate, market index or
other financial asset will not move in the direction the portfolio
manager anticipates;

o the possibility that there will be no liquid secondary market, or the
possibility that price fluctuation limits will be imposed by the
relevant exchange, either of which will make it difficult or
impossible to close out a position when desired;

o the risk that adverse price movements in an instrument will result in
a loss substantially greater than a fund's initial investment; and

o the risk that the counterparty will fail to perform its obligations.

WHEN-ISSUED SECURITIES

The fund may sometimes purchase new issues of securities on a when-issued
basis without limit when, in the opinion of the manager, such purchases will
further the investment objective of the fund. The price of when-issued
securities is established at the time the commitment to purchase is made.
Delivery of and payment for these securities typically occur 15 to 45 days after
the commitment to purchase. Market rates of interest on debt securities at the
time of delivery may be higher or lower than those contracted for on the
when-issued security. Accordingly, the value of such security may decline prior
to delivery, which could result in a loss to the fund. A separate account
consisting of cash or high-quality liquid debt securities in an amount at least
equal to the when-issued commitments will be established and maintained with the
custodian. No income will accrue to the fund prior to delivery.

SHORT SALES

The fund may make a short sale when it wants to sell the security it owns at
a current attractive price, but also wishes to defer recognition of gain or loss

PROSPECTUS INFORMATION REGARDING THE FUND 9

for federal income tax purposes and for purposes of satisfying certain tests
applicable to regulated investment companies under the Internal Revenue Code and
Regulations.

RULE 144A SECURITIES

With respect to securities eligible for resale under Rule 144A, the staff of
the SEC has taken the position that the liquidity of such securities in the
portfolio of a fund offering redeemable securities is a question of fact for the
Board of Directors to determine, such determination to be based upon a
consideration of the readily available trading markets and the review of any
contractual restrictions. The staff also acknowledges that, while the Board
retains ultimate responsibility, it may delegate this function to the manager.
Accordingly, the Board has established guidelines and procedures for determining
the liquidity of Rule 144A securities and has delegated the day-to-day function
of determining the liquidity of Rule 144A securities to the manager. The Board
retains the responsibility to monitor the implementation of the guidelines and
procedures it has adopted.

Since the secondary market for such securities will be limited to certain
qualified institutional investors, the liquidity of such securities may be
limited accordingly and a fund may from time to time hold a Rule 144A security
that is illiquid. In such an event, the fund's manager will consider appropriate
remedies to minimize the effect on such fund's liquidity. The fund will not
invest more than 15% of its assets in illiquid securities (securities that may
not be sold within seven days at approximately the price used in determining the
net asset value of fund shares).

PERFORMANCE ADVERTISING

Cumulative total return data is computed by considering all elements of
return, including reinvestment of dividends and capital gains distributions,
over a stated period of time. Average annual total return is determined by
computing the annual compound return over a stated period of time that would
have produced the fund's cumulative total return over the same period if the
fund's performance had remained constant throughout.

The fund may also include in advertisements data comparing performance with
the performance of non-related investment media, published editorial comments
and performance rankings compiled by independent organizations (such as Lipper
Analytical Services, Inc.) and publications that monitor the performance of
mutual funds. Performance information may be quoted numerically or may be
represented in a table, graph or other illustration. In addition, fund
performance may be compared to well-known indices of market performance,
including the S&P 500 Index, the Dow Jones Industrial Average and The S&P/Barra
Value Index. Fund performance also may be compared to the rankings prepared by
Lipper Analytical Services, Inc. Fund performance also may be compared, on a
relative basis, to other funds in our fund family. This relative comparison,
which may be based upon historical fund performance or historical or expected
volatility or other fund characteristics, may be presented numerically,
graphically or in text.

10 INFORMATION REGARDING THE FUND AMERICAN CENTURY INVESTMENTS

ADDITIONAL INFORMATION YOU SHOULD KNOW

SHARE PRICE

PURCHASE AND REDEMPTION OF SHARES

For instructions on how to purchase and redeem shares, read the prospectus
of your insurance company separate account.

WHEN SHARE PRICE IS DETERMINED

The price of VP Value shares is also referred to as their net asset value.
Net asset value is determined by calculating the total value of the fund's
assets, deducting total liabilities and dividing the result by the number of
shares outstanding. Net asset value is determined at the close of regular
trading on each day that the New York Stock Exchange is open. Investments and
requests to redeem shares received by the separate account before the close of
business of the Exchange, usually 3 p.m. Central time, are effective, and will
receive the price determined, that day as of the close of the Exchange.
Investment, redemption and exchange requests received thereafter are effective
on, and receive the price determined as of the close of the Exchange on, the
next day the Exchange is open.

HOW SHARE PRICE IS DETERMINED

The valuation of assets for determining net asset value may be summarized as
follows:

The portfolio securities of the fund, except as otherwise noted, listed or
traded on a domestic securities exchange are valued at the last price on that
exchange. Portfolio securities primarily traded on foreign securities exchanges
generally are valued at the preceding closing values of such securities on the
exchange where primarily traded. If no sale is reported, or if local convention
or regulation so provides, the mean of the latest bid and asked prices is used.
Depending on local convention or regulation, securities traded over-the-counter
are priced at the mean of the latest bid and asked prices, or at the last sale
price. When market quotations are not readily available, securities and other
assets are valued at fair value as determined in accordance with procedures
adopted by the Board of Directors.

PROSPECTUS ADDITIONAL INFORMATION YOU SHOULD KNOW 11

be affected on days when shares of the fund may not be purchased or redeemed.

DISTRIBUTIONS

TAXES

MANAGEMENT

INVESTMENT MANAGEMENT

The portfolio manager members of the VP Value team and their work experience
for the last five years are as follows:

PETER A. ZUGER, Vice President and Portfolio Manager, joined American
Century in June 1993 as a Portfolio Manager. Prior to joining American Century,
Mr. Zuger served as an investment manager in the Trust Department of NBD Bancorp
in Detroit, Michigan.

PHILLIP N. DAVIDSON, Vice President and Portfolio Manager, joined American
Century in September 1993 as a Portfolio Manager. Prior to joining American
Century, Mr. Davidson served as an investment manager for Boatmen's Trust
Company in St. Louis, Missouri.

The activities of the manager are subject only to directions of the fund's
Board of Directors. The manager pays all the expenses of the fund except
brokerage, taxes, interest, fees, expenses of the non-interested person
directors (including counsel fees) and extraordinary expenses.

CODE OF ETHICS

12 ADDITIONAL INFORMATION YOU SHOULD KNOW AMERICAN CENTURY INVESTMENTS

designed to ensure that the interests of fund shareholders come before the
interests of the people who manage those funds.

TRANSFER AND ADMINISTRATIVE SERVICES

American Century Services Corporation, American Century Tower, 4500 Main
Street, Kansas City, Missouri 64111, acts as transfer agent and dividend-paying
agent for the fund. It provides facilities, equipment and personnel to the fund
and is paid for such services by the manager. Certain administrative and
recordkeeping services that would otherwise be performed by the transfer agent
may be performed by the insurance company that purchases the fund's shares, and
the manager may pay the insurance company for such services.

The manager and the transfer agent are both wholly owned by American Century
Companies, Inc. James E. Stowers Jr., chairman of the fund's Board of Directors,
controls American Century Companies, Inc. by virtue of his voting control of a
majority of its common stock.

DISTRIBUTION OF FUND SHARES

FURTHER INFORMATION ABOUT AMERICAN CENTURY

American Century Variable Portfolios, Inc. issues six series of common stock
with a par value of $.01 per share. Each series is commonly known as a fund. The
assets belonging to each series of shares are held separately by the custodian.
Each share of each series, when issued, is fully paid and non-assessable.

PROSPECTUS ADDITIONAL INFORMATION YOU SHOULD KNOW 13

P.O. BOX 419385
KANSAS CITY, MISSOURI
64141-6385

INSTITUTIONAL SERVICES:
1-800-345-3533 OR 816-531-5575

TELECOMMUNICATIONS DEVICE FOR THE DEAF:
1-800-345-1833 OR 816-444-3038

FAX: 816-340-4360

WWW.AMERICANCENTURY.COM

[american century logo(reg.sm)]
American
Century(reg.tm)

9803 [recycled logo]
SH-BKT-11939 Recycled
<PAGE>
PROSPECTUS

[american century logo(reg.sm)]
American
Century(reg.tm)

MAY 1, 1998

AMERICAN CENTURY
VARIABLE
PORTFOLIOS, INC.

VP Balanced

PROSPECTUS

MAY 1, 1998

VP Balanced

AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.

American Century Variable Portfolios, Inc. is a part of American Century
Investments, a family of funds that includes nearly 70 no-load mutual funds
covering a variety of investment opportunities. Variable Portfolios offers its
shares only to insurance companies to fund the benefits of variable annuity or
variable life insurance contracts. One of the funds, VP Balanced, is described
in this Prospectus. Its investment objective is listed on page 2 of this
Prospectus. The other funds are described in separate prospectuses. You should
consult the prospectus of the separate account of the specific insurance product
that accompanies this Prospectus to see which series of Variable Portfolios are
available for such insurance product.

This Prospectus gives you information about the fund that you should know
before investing. Please read this Prospectus carefully and retain it for future
reference.

PROSPECTUS 1

INVESTMENT OBJECTIVE OF THE FUND

AMERICAN CENTURY VP BALANCED

VP Balanced seeks capital growth and current income. The fund will seek to
achieve its investment objective by maintaining approximately 60% of the assets
of VP Balanced in common stocks that are considered by management to have
better-than-average prospects for appreciation and the remaining assets in bonds
and other fixed income securities.

There is no assurance that the fund will achieve its investment objective.

2 INVESTMENT OBJECTIVE AMERICAN CENTURY INVESTMENTS

TABLE OF CONTENTS

Investment Objective of the Fund .......................................... 2
Financial Highlights ...................................................... 4

INFORMATION REGARDING THE FUND

Investment Policies of the Fund ........................................... 5
Shareholders of Variable Portfolios ....................................... 6
Other Investment Practices, Their Characteristics
and Risks ............................................................... 6
Fundamentals of Fixed Income Investing ................................ 6
Repurchase Agreements ................................................. 7
Foreign Securities .................................................... 7
Forward Currency Exchange Contracts ................................... 7
Derivative Securities ................................................. 8
Short Sales ........................................................... 9
When-Issued Securities ................................................ 9
Rule 144A Securities .................................................. 9
Portfolio Turnover .................................................... 10
Performance Advertising ................................................... 10

ADDITIONAL INFORMATION YOU SHOULD KNOW

Share Price ............................................................... 12
Purchase and Redemption of Shares ..................................... 12
When Share Price Is Determined ........................................ 12
How Share Price Is Determined ......................................... 12
Distributions ............................................................. 13
Taxes ..................................................................... 13
Management ................................................................ 13
Investment Management ................................................. 13
Code of Ethics ........................................................ 14
Transfer and Administrative Services .................................. 14
Distribution of Fund Shares ............................................... 14
Further Information About American Century ................................ 14

PROSPECTUS TABLE OF CONTENTS 3

<TABLE>

<CAPTION>
FINANCIAL HIGHLIGHTS
VP BALANCED

The Financial Highlights for the fiscal year ended December 31, 1997, have
been audited by Deloitte & Touche, LLP independent auditors, whose report
thereon appears in the fund's annual report, which is incorporated by reference
into the Statement of Additional Information. The annual report contains
additional performance information and will be made available upon request and
without charge. The Financial Highlights for the periods ended on or before
December 31, 1996, have been audited by other independent auditors. The
information presented is for a share outstanding throughout the years ended
December 31, except as noted.

1997 1996 1995 1994 1993 1992 1991(1)

PER-SHARE DATA

Net Asset Value,
<S> <C> <C> <C> <C> <C> <C> <C>
Beginning of Period .............. $7.54 $7.04 $5.96 $6.07 $5.74 $6.19 $5.00
-------- -------- -------- -------- -------- -------- --------
Income From
Investment Operations

Net Investment Income .......... 0.19 0.18 0.17 0.15 0.11 0.08 0.08

Net Realized and
Unrealized Gain
(Loss) on Investment
Transactions ................... 0.94 0.65 1.08 (0.11) 0.33 (0.45) 1.19
-------- -------- -------- -------- -------- -------- --------
Total From Investment
Operations ..................... 1.13 0.83 1.25 0.04 0.44 (0.37) 1.27
-------- -------- -------- -------- -------- -------- --------
Distributions

From Net Investment Income ..... (0.09) (0.13) (0.17) (0.15) (0.11) (0.08) (0.08)

From Net Realized Gains
on Investment Transactions ..... (0.34) (0.20) -- -- -- -- --
-------- -------- -------- -------- -------- -------- --------
Total Distributions ............ (0.43) (0.33) (0.17) (0.15) (0.11) (0.08) (0.08)
-------- -------- -------- -------- -------- -------- --------
Net Asset Value, End of Period ... $8.24 $7.54 $7.04 $5.96 $6.07 $5.74 $6.19
======== ======== ======== ======== ======== ======== ========
TOTAL RETURN(2) ................ 15.81% 12.21% 21.12% 0.61% 7.68% (6.04)% 38.02%(3)

RATIOS/SUPPLEMENTAL DATA

Ratio of Operating Expenses
to Average Net Assets ............ 1.00% 0.99% 0.97% 1.00% 1.00% 1.00% 1.00%(3)

Ratio of Net Investment Income
to Average Net Assets ............ 2.19% 2.43% 2.69% 2.49% 1.97% 1.91% 2.36%(3)

Portfolio Turnover Rate .......... 125% 130% 87% 63% 68% 85% 28%

Average Commission
Paid per Share
of Equity Security Traded ........ $0.0395 $0.0373 $0.0400 --(4) --(4) --(4) --(4)

Net Assets, End
of Period (in thousands) ......... $219,087 $215,393 $153,823 $105,100 $75,924 $34,382 $1,412
</TABLE>
- ----------

(1) May 1, 1991 (inception) through December 31, 1991.

(2) Total return assumes reinvestment of dividends and capital gains
distributions, if any.

(3) Annualized.

(4) Disclosure of average commission paid per share of equity security traded
was not required prior to the year ended December 31, 1995.

4 FINANCIAL HIGHLIGHTS AMERICAN CENTURY INVESTMENTS

INFORMATION REGARDING THE FUND

INVESTMENT POLICIES OF THE FUND

VP Balanced seeks capital growth and current income. The fund will seek to
achieve its objective, with regard to the equity portion of its portfolio, by
investing in common stocks (including securities convertible into common stocks
and other equity equivalents) and other securities that meet certain fundamental
and technical standards of selection and have, in the opinion of the fund's
investment manager, better-than-average potential for appreciation. Management
of the fund intends to maintain approximately 60% of the fund's assets in such
securities, regardless of the movement of stock prices generally.

The equity portion of the fund may be invested in cash and cash equivalents
temporarily or when the fund is unable to find equity securities meeting its
criteria of selection. It may purchase only securities of companies that have a
record of at least three years' continuous operation.

Since a portion of the fund's portfolio will be invested in fixed income
securities, the opportunity for capital appreciation may be expected to be less
than with a fund that invests primarily in common stocks.

Management intends to maintain approximately 40% of the fund's assets in
fixed income securities, with a minimum of 25% of the fund's assets in fixed
income senior securities. The fixed income securities in the fund will be chosen
based on their level of income production and price stability. The fund may
invest in a diversified portfolio of debt and other fixed-rate securities
payable in United States currency. These may include obligations of the United
States government, its agencies and instrumentalities, corporate securities
(bonds, notes, preferred and convertible issues), and sovereign government,
municipal, mortgage-backed and other asset-backed securities.

The government securities in which the fund may invest include: (1) direct
obligations of the United States, such as Treasury bills, notes and bonds, which
are supported by the full faith and credit of the United States, and (2)
obligations (including mortgage-backed securities) issued or guaranteed by
agencies and instrumentalities of the United States government that are
established under an act of Congress. The securities of some of these agencies
and instrumentalities, such as the Government National Mortgage Association, are
guaranteed as to principal and interest by the U.S. Treasury, and other
securities are supported by the right of the issuer, such as the Federal Home
Loan Banks, to borrow from the Treasury. Other obligations, including those
issued by the Federal National Mortgage Association and the Federal Home Loan
Mortgage Corporation, are supported only by the credit of the instrumentality.

Mortgage-backed securities in which the fund may invest include
collateralized mortgage obligations ("CMOs") issued by a United States agency or
instrumentality. A CMO is a debt security that is collateralized by a portfolio
or pool of mortgages or mortgage-backed securities. The issuer's obligation to
make interest and principal payments is secured by the underlying pool or
portfolio of mortgages or securities.

PROSPECTUS INFORMATION REGARDING THE FUND 5

securities may decrease in the same manner as other debt, but when interest
rates decline, their market value may not increase as much as other debt
instruments because of the prepayment feature inherent in the underlying
mortgages. If such securities are purchased at a premium, the fund will suffer a
loss if the obligation is prepaid. Prepayments will be reinvested at prevailing
rates, which may be less than the rate paid by the prepaid obligation.

For the purpose of determining the weighted average portfolio maturity of
the fund, the manager shall consider the maturity of a mortgage-backed security
to be the remaining expected average life of the security. The average life of
such securities is likely to be substantially less than the original maturity as
a result of prepayments of principal of the underlying mortgages, especially in
a declining interest rate environment. In determining the remaining expected
average life, the manager makes assumptions regarding prepayments on underlying
mortgages. In a rising interest rate environment, those prepayments generally
decrease, and may decrease below the rate of prepayment assumed by the manager
when purchasing those securities. Such slowdown may cause the remaining maturity
of those securities to lengthen, which will increase the relative volatility of
those securities and, hence, the fund holding the securities. See "Fundamentals
of Fixed Income Investing," this page.

It is the manager's intention to invest the fund's fixed income holdings in
high-grade securities. At least 80% of fixed income assets will be invested in
securities that at the time of purchase are rated within the three highest
categories by a nationally recognized statistical rating organization [for
example, at least A by Moody's Investor Services, Inc. (Moody's) or Standard &
Poor's Corp. (S&P)].

The remaining portion of the fixed income assets may be invested in issues
in the fourth highest category (for example, Baa by Moody's or BBB by S&P) or,
if not rated, are of equivalent investment quality as determined by the manager
and that, in the opinion of the manager, can contribute meaningfully to the
fund's results without compromising its objectives. Such issues might include a
lower-rated issue where research suggests the likelihood of a rating increase or
a convertible issue of a company deemed attractive by the equity management
team. For a brief discussion of fixed income investing, see "Fundamentals of
Fixed Income Investing," this page.

There are no maturity restrictions on the securities in which the fund
invests. Under normal market conditions the weighted average portfolio maturity
for the fixed income portfolio will be in the three- to 10-year range. The
manager will actively manage the portfolio, adjusting the weighted average
portfolio maturity in response to expected changes in interest rates. During
periods of rising interest rates, a shorter-weighted average maturity may be
adopted in order to reduce the effect of bond price declines on the fund's net
asset value. When interest rates are falling and bond prices rising, a
longer-weighted average portfolio maturity may be adopted.

SHAREHOLDERS OF VARIABLE PORTFOLIOS

Variable Portfolios will offer its shares only to insurance companies for
the purpose of funding variable annuity or variable life insurance contracts.
Although Variable Portfolios does not foresee any disadvantages to contract
owners due to the fact that it offers its shares as an investment medium for
both variable annuity and variable life products, the interests of various
contract owners participating in the funds of Variable Portfolios might, at some
time, be in conflict due to future differences in tax treatment of variable
products or other considerations. Consequently, Variable Portfolios' Board of
Directors will monitor events in order to identify any material irreconcilable
conflicts that may possibly arise and to determine what action, if any, should
be taken in response to such conflicts. If a conflict were to occur, an
insurance company separate account might be required to withdraw its investments
in the fund and the fund might be forced to sell securities at disadvantageous
prices to fund such withdrawal.

OTHER INVESTMENT PRACTICES, THEIR CHARACTERISTICS
AND RISKS

For additional information, see "Investment Restrictions Applicable to all
Series of Shares" in the Statement of Additional Information.

FUNDAMENTALS OF FIXED INCOME INVESTING

Over time, the level of interest rates available in the marketplace changes.
As prevailing rates fall, the prices of bonds and other securities that trade on
a

6 INFORMATION REGARDING THE FUND AMERICAN CENTURY INVESTMENTS

yield basis rise. On the other hand, when prevailing interest rates rise, bond
prices fall.

Generally, the longer the maturity of a debt security, the higher its yield
and the greater its price volatility. Conversely, the shorter the maturity, the
lower the yield but the greater the price stability.

These factors operating in the marketplace have a similar impact on bond
portfolios. A change in the level of interest rates causes the net asset value
per share of any bond fund, except money market funds, to change. If sustained
over time, it would also have the impact of raising or lowering the yield of
that fund.

In addition to the risk arising from fluctuating interest rate levels, debt
securities are subject to credit risk. When a security is purchased, its
anticipated yield is dependent on the timely payment by the borrower of each
interest and principal installment. Credit analysis and resultant bond ratings
take into account the relative likelihood that such timely payment will occur.
As a result, lower-rated bonds tend to sell at higher yield levels than
top-rated bonds of similar maturity.

In addition, as economic, political and business developments unfold,
lower-quality bonds, which possess lower levels of protection with regard to
timely payment, usually exhibit more price fluctuation than do higher-quality
bonds of like maturity.

REPURCHASE AGREEMENTS

Since the security purchased constitutes security for the repurchase
obligation, a repurchase agreement can be considered a loan collateralized by
the security purchased.

FOREIGN SECURITIES

The fund may invest an unlimited amount of its assets in the securities of
foreign issuers when these securities meet its standards of selection. The fund
may make such investments either directly in foreign securities or indirectly by
purchasing depositary receipts or depositary shares or similar instruments
(collectively "depositary receipts") for foreign securities. Depositary receipts
are securities listed on exchanges or quoted in the over-the-counter markets in
one country but represent shares of issuers domiciled in another country.
Depositary receipts may be sponsored or unsponsored. Direct investments in
foreign securities may be made either on foreign securities exchanges or in the
over-the-counter market.

FORWARD CURRENCY EXCHANGE CONTRACTS

Some of the foreign securities held by the fund may be denominated in
foreign currencies. Other securities, such as depositary receipts, may be

PROSPECTUS INFORMATION REGARDING THE FUND 7

denominated in U.S. dollars or the currency of the country where issued (if not
U.S. dollars), but have a value that is dependent upon the performance of a
foreign security, as valued in the currency of its home country. As a result,
the value of the fund's portfolio may be affected by changes in the exchange
rate between foreign currencies and the U.S. dollar, as well as by changes in
the market value of the securities themselves. The performance of foreign
currencies relative to the U.S. dollar may be an important factor in the overall
performance of the fund.

The fund may elect to enter into a forward currency exchange contract with
respect to a specific purchase or sale of a security, or with respect to the
fund's portfolio positions generally.

When the manager believes that a particular currency may decline in value
compared to the U.S. dollar, the fund may enter into foreign currency exchange
contracts to sell the value of some or all of the fund's portfolio securities
either denominated in, or whose value is tied to, that currency. This practice
is sometimes referred to as "portfolio hedging." The fund may not enter into a
portfolio hedging transaction where the fund would be obligated to deliver an
amount of foreign currency in excess of the aggregate value of its portfolio
securities or other assets denominated in, or whose value is tied to, that
currency.

If the fund enters into a forward currency exchange contract, the fund, when
required, will instruct its custodian bank to segregate cash or liquid
high-grade securities in a separate account in an amount sufficient to cover its
obligation under the contract. Those assets will be valued at market daily, and
if the value of the segregated securities declines, additional cash or
securities will be added so that the value of the account is not less than the
amount of the fund's commitment. At any given time, no more than 10% of the
fund's assets will be committed to a segregated account in connection with
portfolio hedging transactions.

DERIVATIVE SECURITIES

To the extent permitted by its investment objective and policies, the fund
may invest in securities that are commonly referred to as "derivative"
securities. Generally, a derivative is a financial arrangement the value of
which is based on, or "derived" from, a traditional security asset, or market
index. Certain derivative securities are more accurately described as
"index/structured securities." Index/structured securities are derivative
securities whose value or performance is linked to other equity securities (such
as depositary receipts), currencies, interest rates, indexes or other financial
indicators (reference indices). The fund may not invest in an index/structured
security unless the reference index or the instrument to which it relates is an
eligible investment for the fund. For example, a security whose underlying value
is linked to the price of oil would not be a permissible investment because the
fund may not invest in oil and gas leases or futures.

The return on a derivative security may increase or decrease, depending upon
changes in the reference index or the instrument to which it relates.

8 INFORMATION REGARDING THE FUND AMERICAN CENTURY INVESTMENTS

There is a range of risks associated with derivative investments, including
but not limited to:

* the risk that the underlying security, interest rate, market index or
other financial asset will not move in the direction the portfolio
manager anticipates;

* the risk that adverse price movements in an instrument will result in a
loss substantially greater than a fund's initial investment; and

* the risk that the counterparty will fail to perform its obligations.

SHORT SALES

The fund may make a short sale when it wants to sell the security it owns at
a current attractive price but also wishes to defer recognition of gain or loss
for federal income tax purposes and for purposes of satisfying certain tests
applicable to regulated investment companies under the Internal Revenue Code and
Regulations.

WHEN-ISSUED SECURITIES

RULE 144A SECURITIES

PROSPECTUS INFORMATION REGARDING THE FUND 9

bility, it may delegate this function to the manager. Accordingly, the Board has
established guidelines and procedures for determining the liquidity of Rule 144A
securities and has delegated the day-to-day function of determining the
liquidity of Rule 144A securities to the manager. The Board retains the
responsibility to monitor the implementation of the guidelines and procedures it
has adopted.

The fund may invest up to 15% of its assets in illiquid securities
(securities that may not be sold within seven days at approximately the price
used in determining the net asset value of fund shares).

PORTFOLIO TURNOVER

The total portfolio turnover rate of the fund is shown in the Financial
Highlights table on page 4 of this Prospectus.

PERFORMANCE ADVERTISING

From time to time, the fund (or the insurance companies that use the fund to
fund the benefits of variable annuity or variable life insurance contracts) may
advertise performance data. Fund performance may be shown by presenting one or
more performance measurements, including cumulative total return, average annual
total return, yield and effective yield.

A quotation of yield reflects the fund's income over a stated period
expressed as a percentage of the fund's share price.

Yield is calculated by adding over a 30-day (or one-month) period all
interest and dividend income (net of fund expenses) calculated on each day's
market values, dividing this sum by the average number of fund shares
outstanding during the period, and expressing the result as a percentage of the
fund's share price on the last day of the 30-day (or one-month) period. The
percentage is then annualized. Capital gains and losses are not included in the
calculation.

Yields are calculated according to accounting methods that are standardized
in accordance with SEC rules for all stock and bond funds. Because yield
accounting methods differ from the methods used for other accounting purposes,
the fund's yield may not equal income paid on your shares or the income reported
in the fund's financial statements.

The fund may also include in advertisements data comparing performance with
the performance of non-related investment media, published editorial comments
and performance rankings compiled by independent organizations (such as Lipper
Analytical Services, Inc. or Donoghue's Money Fund Report) and publications that
monitor the performance of mutual funds. Performance information may be quoted
numerically or may be represented in a table, graph or other illustration. In
addition, fund performance may be compared to well-known indices of market
performance including the S&P 500 Index, the Dow Jones Industrial Average,
Donoghue's Money Fund Average, the Shearson Lehman Intermediate Government Bond
Index, the constant maturity five-year U.S. Treasury Note Index and the Bank
Rate Monitor National Index of 2 (1)/(2) -year CD rates. Fund performance also
may be compared to the rankings prepared by Lipper Analytical Services, Inc.
Fund

10 INFORMATION REGARDING THE FUND AMERICAN CENTURY INVESTMENTS

performance also may be compared, on a relative basis, to other funds in our
fund family. This relative comparison, which may be based upon historical fund
performance or historical or expected volatility or other fund characteristics,
may be presented numerically, graphically or in text.

PROSPECTUS INFORMATION REGARDING THE FUND 11

ADDITIONAL INFORMATION YOU SHOULD KNOW

SHARE PRICE

PURCHASE AND REDEMPTION OF SHARES

For instructions on how to purchase and redeem shares, read the prospectus
of your insurance company separate account.

WHEN SHARE PRICE IS DETERMINED

The price of VP Balanced shares is also referred to as their net asset
value. Net asset value is determined by calculating the total value of the
fund's assets, deducting total liabilities and dividing the result by the number
of shares outstanding. Net asset value is determined at the close of regular
trading on each day that the New York Stock Exchange is open. Investments and
requests to redeem shares received by the separate account before the close of
business of the Exchange, usually 3 p.m. Central time, are effective, and will
receive the price determined that day as of the close of the Exchange.
Investment, redemption and exchange requests received thereafter are effective
on, and receive the price determined as of the close of the Exchange on, the
next day the Exchange is open.

HOW SHARE PRICE IS DETERMINED

The valuation of assets for determining net asset value may be summarized as
follows:

12 PROSPECTUS ADDITIONAL INFORMATION YOU SHOULD KNOW

lation and the value of the fund's portfolio may be affected on days when shares
of the fund may not be purchased or redeemed.

DISTRIBUTIONS

TAXES

MANAGEMENT

INVESTMENT MANAGEMENT

The portfolio manager members of the VP Balanced team and their work
experience for the last five years are as follows:

JAMES, E. STOWERS III, Chief Executive Officer and Portfolio Manager, joined
American Century in 1981. He is a member of the team that manages the equity
portion of VP Balanced.

NORMAN E. HOOPS, Senior Vice President and fixed income Portfolio Manager,
joined American Century as Vice President and Portfolio Manager in November
1989. In April 1993, he became Senior Vice President. He is a member of the team
that manages the fixed income portion of VP Balanced.

JEFFREY L. HOUSTON, Portfolio Manager, has worked for American Century since
November 1990. He is a member of the team that manages the fixed income portion
of VP Balanced.

JOHN R. SYKORA, Vice President and Portfolio Manager, joined American
Century in May 1994 as an Investment Analyst, a position he held until August
1997. At that time he was promoted to Portfolio Manager. Prior to joining
American Century, Mr. Sykora served as a Financial Analyst for Business Men's
Assurance Company of America, Kansas City, Missouri, from August 1993 to April
1994. Prior to that Mr. Sykora attended Michigan State University where he
obtained his MBA degree. He is a member of the team that manages the equity
portion of VP Balanced.

BRUCE A. WIMBERLY, Vice President and Portfolio Manager, joined American
Century in September 1994 as an Investment Analyst, a position he held until
July 1996. At that time he was promoted to Portfolio Manager. Prior to joining
American Century, Mr. Wimberly attended Kellogg Graduate School of Management,
Northwestern University from August 1992 to August 1994, where he obtained his
MBA degree. He is a member of the team that manages the equity portion of VP
Balanced.

PROSPECTUS ADDITIONAL INFORMATION YOU SHOULD KNOW 13

CODE OF ETHICS

TRANSFER AND ADMINISTRATIVE SERVICES

American Century Services Corporation, American Century Tower, 4500 Main
Street, Kansas City, Missouri 64111, acts as transfer agent and dividend-paying
agent for the fund. It provides facilities, equipment and personnel to the fund
and is paid for such services by the manager. Certain recordkeeping and
administrative services that would otherwise be performed by the transfer agent
may be performed by the insurance company that purchases the fund's shares, and
the manager may pay the insurance company for such services.

The manager and the transfer agent are both wholly owned by American Century
Companies, Inc. James E. Stowers Jr., chairman of the fund's Board of Directors,
controls American Century Companies, Inc. by virtue of his ownership of a
majority of its common stock.

DISTRIBUTION OF FUND SHARES

FURTHER INFORMATION ABOUT AMERICAN CENTURY

Each share, irrespective of series, is entitled to one vote for each dollar
of net asset value applicable to such share on all questions, except for those
matters

14 ADDITIONAL INFORMATION YOU SHOULD KNOW AMERICAN CENTURY INVESTMENTS

which must be voted on separately by the series of shares affected. Matters
affecting only one series are voted upon only by that series.

Shares have non-cumulative voting rights, which means that holders of more
than 50% of the votes cast in an election of directors can elect all of the
directors if they choose to do so and, in such event, the holders of the
remaining votes will not be able to elect any person or persons to the Board of
Directors.

PROSPECTUS ADDITIONAL INFORMATION YOU SHOULD KNOW 15

NOTES

16 NOTES

NOTES

NOTES 17

P.O. BOX 419385
KANSAS CITY, MISSOURI
64141-6385

INSTITUTIONAL SERVICES:
1-800-345-3533 OR 816-531-5575

TELECOMMUNICATIONS DEVICE FOR THE DEAF:
1-800-345-1833 OR 816-444-3038

FAX: 816-340-4360

www.americancentury.com

[american century logo(reg.sm)]
American
Century(reg.tm)

9803 [recycled logo]
SH-BKT-11943 Recycled
<PAGE>
PROSPECTUS

[american century logo(reg.sm)]
American
Century(reg.tm)

MAY 1, 1998

AMERICAN CENTURY
VARIABLE
PORTFOLIOS, INC.

VP Advantage

PROSPECTUS

MAY 1, 1998

VP Advantage

AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.

American Century Variable Portfolios, Inc. is a part of American Century
Investments, a family of funds that includes nearly 70 no-load mutual funds
covering a variety of investment opportunities. Variable Portfolios offers its
shares only to insurance companies to fund the benefits of variable annuity or
variable life insurance contracts. One of the funds, VP Advantage, is described
in this Prospectus. Its investment objective is listed on page 2 of this
Prospectus. The other funds are described in separate prospectuses. You should
consult the prospectus of the separate account of the specific insurance product
that accompanies this Prospectus to see which series of Variable Portfolios are
available for such insurance product.

This Prospectus gives you information about the fund that you should know
before investing. Please read this Prospectus carefully and retain it for future
reference.

PROSPECTUS 1

INVESTMENT OBJECTIVE OF THE FUND

AMERICAN CENTURY VP ADVANTAGE

VP Advantage seeks current income and capital growth. The fund will seek
to achieve its investment objective by investing in three types of securities.
The fund's investment manager intends to invest approximately (i) 20% of the
fund's assets in securities of the United States government and its agencies and
instrumentalities and repurchase agreements collateralized by such securities
with a weighted average maturity of six months or less, i.e., cash or cash
equivalents, (ii) 40% of the fund's assets in fixed income securities of the
United States government and its agencies and instrumentalities with a weighted
average maturity of three to 10 years and (iii) 40% of the fund's assets in
equity securities that are considered by management to have better-than-average
prospects for appreciation. As described in greater detail in this Prospectus,
assets will be purchased or sold, as the case may be, as is necessary in
response to changes in market value to maintain the asset mix of the fund's
portfolio at approximately 60% cash, cash equivalents and fixed income
securities and 40% equity securities.

There is no assurance that the fund will achieve its investment objective.

2 INVESTMENT OBJECTIVE AMERICAN CENTURY INVESTMENTS

TABLE OF CONTENTS

Investment Objective of the Fund .......................................... 2
Financial Highlights ...................................................... 4

INFORMATION REGARDING THE FUND

Investment Policies of the Fund ........................................... 5
Shareholders of Variable Portfolios ....................................... 6
Other Investment Practices, Their Characteristics
and Risks ............................................................... 6
Fundamentals of Fixed Income Investing ................................ 6
Repurchase Agreements ................................................. 7
Foreign Securities .................................................... 7
Forward Currency Exchange Contracts ................................... 8
Derivative Securities ................................................. 8
Short Sales ........................................................... 9
When-Issued Securities ................................................ 9
Rule 144A Securities .................................................. 10
Portfolio Turnover .................................................... 10
Performance Advertising ................................................... 10

ADDITIONAL INFORMATION YOU SHOULD KNOW

PROSPECTUS TABLE OF CONTENTS 3

FINANCIAL HIGHLIGHTS
VP ADVANTAGE

The Financial Highlights for the fiscal year ended December 31, 1997, have
been audited by Deloitte & Touche LLP independent auditors, whose report thereon
appears in the fund's annual report, which is incorporated by reference into the
Statement of Additional Information. The annual report contains additional
performance information and will be made available upon request and without
charge. The Financial Highlights for the periods ended on or before December 31,
1996, have been audited by other independent auditors. The information presented
is for a share outstanding throughout the years ended December 31, except as
noted.

1997 1996 1995 1994 1993 1992 1991(1)

PER-SHARE DATA

Net Asset Value,
<S> <C> <C> <C> <C> <C> <C> <C>
Beginning of Period ....................... $6.29 $6.19 $5.48 $5.57 $5.32 $5.64 $5.00
-------- -------- -------- -------- -------- -------- --------
Income From Investment Operations

Net Investment Income ................... 0.19 0.20 0.20 0.15 0.11 0.11 0.05

Net Realized and Unrealized Gain (Loss)
on Investment Transactions .............. 0.56 0.34 0.71 (0.09) 0.25 (0.32) 0.64
-------- -------- -------- -------- -------- -------- --------
Total From Investment Operations ........ 0.75 0.54 0.91 0.06 0.36 (0.21) 0.69
-------- -------- -------- -------- -------- -------- --------
Distributions

From Net Investment Income .............. (0.10) (0.15) (0.20) (0.15) (0.11) (0.11) (0.05)

From Net Realized Gains
on Investment Transactions .............. (0.34) (0.29) -- -- -- -- --
-------- -------- -------- -------- -------- -------- --------
Total Distributions ..................... (0.44) (0.44) (0.20) (0.15) (0.11) (0.11) (0.05)
-------- -------- -------- -------- -------- -------- --------
Net Asset Value, End of Period ............ $6.60 $6.29 $6.19 $5.48 $5.57 $5.32 $5.64
======== ======== ======== ======== ======== ======== ========
TOTAL RETURN(2) ......................... 12.83% 9.25% 16.75% 1.03% 6.82% (3.75)% 33.14%(3)

RATIOS/SUPPLEMENTAL DATA

Ratio of Operating Expenses
to Average Net Assets ..................... 0.99% 0.98% 0.95% 1.00% 1.00% 1.00% 1.00%(3)

Ratio of Net Investment Income
to Average Net Assets ..................... 2.85% 3.10% 3.32% 2.65% 2.07% 2.32% 3.14%(3)

Portfolio Turnover Rate ................... 69% 80% 99% 57% 77% 85% 5%

Average Commission Paid per Share
of Equity Security Traded ................. $0.0381 $0.0380 $0.0410 --(4) --(4) --(4) --(4)

Net Assets, End
of Period (in thousands) .................. $25,244 $25,230 $24,037 $22,413 $20,959 $16,580 $3,069
</TABLE>
- ----------

(1) August 1, 1991 (inception) through December 31, 1991.

(2) Total return assumes reinvestment of dividends and capital gains
distributions, if any.

(3) Annualized.

(4) Disclosure of average commission paid per share of equity security traded
was not required prior to the year ended December 31, 1995.

4 FINANCIAL HIGHLIGHTS AMERICAN CENTURY INVESTMENTS

INFORMATION REGARDING THE FUND

INVESTMENT POLICIES OF THE FUND

American Century Variable Portfolios ("Variable Portfolios") has adopted
certain investment restrictions applicable to the fund that are set forth in the
Statement of Additional Information. Those restrictions, as well as the
investment objective of the fund identified on page 2 of this Prospectus and any
other investment policies designated as "fundamental" in this Prospectus or in
the Statement of Additional Information, cannot be changed without shareholder
approval. The fund has implemented additional investment policies and practices
to guide its activities in the pursuit of its investment objective. These
policies and practices, which are described throughout this Prospectus, are not
designated as fundamental policies and may be changed without shareholder
approval.

VP Advantage seeks current income and capital growth. The fund will seek to
achieve its investment objective by investing in three types of securities. The
fund's investment manager intends to invest approximately 20% of the fund's
assets (the Core Cash portion) in securities of the U.S. government, its
agencies and instrumentalities (government securities) with a weighted average
maturity of six months or less, i.e., cash or cash equivalents. The investment
manager intends to invest approximately 40% of the fund's assets (the Fixed
Income portion) in fixed income government securities with a weighted average
maturity of three to 10 years. If the investment manager believes, in its
discretion, that market conditions warrant it, some or all of the Fixed Income
portion of the fund's portfolio may be invested in cash or cash equivalents. The
remaining, approximately 40% of the fund's assets (the Equity portion), will be
invested in equity securities.

When changes in the market value of the fund's assets cause the Equity
portion of the fund to be equal to or less than 35% of the fund's assets, or to
be equal to or greater than 45% of the fund's assets, equity and fixed income
securities will be purchased or sold, as the case may be, so that the Equity
portion will again represent approximately 40% of the fund's assets.

The securities to be purchased for the Core Cash portion and the Fixed
Income portion of the fund will be chosen based on their level of income
production and price stability and will consist only of obligations of the U.S.
government, its agencies and instrumentalities, including mortgage-backed and
other asset-backed securities, and repurchase agreements fully collateralized by
such securities.

The government securities in which the fund may invest include: (1) direct
obligations of the United States, such as Treasury bills, notes and bonds, which
are supported by the full faith and credit of the United States, and (2)
obligations, (including mortgage-backed securities) issued or guaranteed by
agencies and instrumentalities of the United States government that are
established under an act of Congress. The securities of some of these agencies
and instrumentalities, such as the Government National Mortgage Association, are
guaranteed as to principal and interest by the U.S. Treasury, and other
securities are supported by the right of the issuer, such as the Federal Home
Loan Banks, to borrow from the Treasury. Other obligations, including those
issued by the Federal National Mortgage Association and the Federal Home Loan
Mortgage Corporation, are supported only by the credit of the instrumentality.

Mortgage-backed securities in which the fund may invest include
collateralized mortgage obligations (CMOs) issued by a United States agency or
instrumentality. A CMO is a debt security that is collateralized by a portfolio
or pool of mortgages or mortgage-backed securities. The issuer's obligation to
make interest and principal payments is secured by the underlying pool or
portfolio of mortgages or securities.

The market value of mortgage-backed securities, even those in which the
underlying pool of mortgage loans is guaranteed as to the payment of principal
and interest by the U.S. government, is not insured. When interest rates rise,
the market value of those securities may decrease in the same manner as other
debt, but when interest rates decline, their market value may not increase as
much as other debt instru-

PROSPECTUS INFORMATION REGARDING THE FUND 5

ments because of the prepayment feature inherent in the underlying mortgages. If
such securities are purchased at a premium, the fund will suffer a loss if the
obligation is prepaid. Prepayments will be reinvested at prevailing rates, which
may be less than the rate paid by the prepaid obligation.

For the purpose of determining the weighted average portfolio maturity of
the fund, the manager shall consider the maturity of a mortgage-backed security
to be the remaining expected average life of the security. The average life of
such securities is likely to be substantially less than the original maturity as
a result of prepayments of principal on the underlying mortgages, especially in
a declining interest rate environment. In determining the remaining expected
average life, the manager makes assumptions regarding prepayments on underlying
mortgages. In a rising interest rate environment, those prepayments generally
decrease, and may decrease below the rate of prepayment assumed by the manager
when purchasing those securities. Such slowdown may cause the remaining maturity
of those securities to lengthen, which will increase the relative volatility of
those securities and, hence, the fund holding the securities. See "Fundamentals
of Fixed Income Investing," this page.

While there are no maturity restrictions on the debt securities in which the
fund may invest, the weighted average maturity of the Core Cash portion is
expected to be six months or less. Under normal market conditions the weighted
average maturity of the Fixed Income portion will be in the three- to 10-year
range. The manager will actively manage such portion of the fund's assets,
adjusting the weighted average portfolio maturity in response to expected
changes in interest rates. During periods of rising interest rates, a shorter
weighted average maturity may be adopted in order to reduce the effect of fixed
income security price declines on the fund's net asset value. When interest
rates are falling and fixed income security prices rising, a longer weighted
average portfolio maturity may be adopted. If the manager believes that market
conditions merit it, some or all of the assets in the Fixed Income portion may
be invested in cash and cash equivalents.

With regard to the Equity portion of its portfolio, the fund will invest in
common stocks (including securities convertible into common stocks and other
equity equivalents) and other securities that meet certain fundamental and
technical standards of selection and have, in the opinion of the investment
manager, better-than-average potential for appreciation.

The Equity portion of the fund may be invested in cash and cash equivalents,
including repurchase agreements, temporarily or when the fund is unable to find
equity securities meeting its criteria of selection. The fund may purchase
equity securities only of companies that have a record of at least three years'
continuous operation.

SHAREHOLDERS OF VARIABLE PORTFOLIOS

Variable Portfolios will offer its shares only to insurance companies for
the purpose of funding variable annuity or variable life insurance contracts.
Although Variable Portfolios does not foresee any disadvantages to contract
owners due to the fact that it offers its shares as an investment medium for
both variable annuity and variable life products, the interests of various
contract owners participating in the funds of Variable Portfolios might, at some
time, be in conflict due to future differences in tax treatment of variable
products or other considerations. Consequently, Variable Portfolios' Board of
Directors will monitor events in order to identify any material irreconcilable
conflicts that may possibly arise and to determine what action, if any, should
be taken in response to such conflicts. If a conflict were to occur, an
insurance company separate account might be required to withdraw its investments
in the fund and the fund might be forced to sell securities at disadvantageous
prices to fund such withdrawal.

OTHER INVESTMENT PRACTICES, THEIR CHARACTERISTICS
AND RISKS

For additional information regarding the fund and its investment policies,
see "Investment Restrictions Applicable to all Series of Shares" in the
Statement of Additional Information.

FUNDAMENTALS OF FIXED INCOME INVESTING

Over time, the level of interest rates available in the marketplace changes.
As prevailing rates fall, the prices of bonds and other securities that trade on
a yield basis

6 INFORMATION REGARDING THE FUND AMERICAN CENTURY INVESTMENTS

rise. On the other hand, when prevailing interest rates rise, bond prices
fall.

REPURCHASE AGREEMENTS

Since the security purchased constitutes security for the repurchase
obligation, a repurchase agreement can be considered a loan collateralized by
the security purchased.

FOREIGN SECURITIES

The fund may invest in equity securities of foreign issuers when these
securities meet its standards of selection. The fund may make such investments
either directly in foreign securities, or indirectly by purchasing depositary
receipts or depositary shares or similar instruments (collectively "depositary
receipts") for foreign securities. Depositary receipts are securities listed on
exchanges or quoted in the over-the-counter markets in one country but represent
shares of issuers domiciled in another country. Depositary receipts may be
sponsored or unsponsored. Direct investments in foreign securities may be made
either on foreign securities exchanges or in the over-the-counter markets.

PROSPECTUS INFORMATION REGARDING THE FUND 7

the lack of uniform accounting, auditing and financial reporting standards and
other regulatory practices and requirements comparable to those applicable to
domestic issuers.

FORWARD CURRENCY EXCHANGE CONTRACTS

Some of the foreign securities held by the fund may be denominated in
foreign currencies. Other securities, such as depositary receipts, may be
denominated in U.S. dollars or the currency of the country where issued (if not
U.S. dollars) but have a value that is dependent upon the performance of a
foreign security, as valued in the currency of its home country. As a result,
the value of the fund's portfolio may be affected by changes in the exchange
rate between foreign currencies and the U.S. dollar, as well as by changes in
the market value of the securities themselves. The performance of foreign
currencies relative to the U.S. dollar may be an important factor in the overall
performance of the fund.

The fund may elect to enter into a forward currency exchange contract with
respect to a specific purchase or sale of a security, or with respect to the
fund's portfolio positions generally.

When the manager believes that a particular currency may decline in value
compared to the U.S. dollar, the fund may enter into foreign currency exchange
contracts to sell the value of some or all of the fund's portfolio securities
either denominated in, or whose value is tied to, that currency. This practice
is sometimes referred to as "portfolio hedging." The fund may not enter into a
portfolio hedging transaction where the fund would be obligated to deliver an
amount of foreign currency in excess of the aggregate value of its portfolio
securities or other assets denominated in, or whose value is tied to, that
currency.

If the fund enters into a forward currency exchange contract, the fund, when
required, will instruct its custodian bank to segregate cash or liquid
high-grade securities in a separate account in an amount sufficient to cover its
obligation under the contract. Those assets will be valued at market daily, and
if the value of the segregated securities declines, additional cash or
securities will be added so that the value of the account is not less than the
amount of the fund's commitment. At any given time, no more than 10% of the
fund's assets will be committed to a segregated account in connection with
portfolio hedging transactions.

DERIVATIVE SECURITIES

8 INFORMATION REGARDING THE FUND AMERICAN CENTURY INVESTMENTS

fund may not invest in an index/structured security unless the reference index
or the instrument to which it relates is an eligible investment for the fund.
For example, a security whose underlying value is linked to the price of oil
would not be a permissible investment because the fund may not invest in oil and
gas leases or futures.

The return on a derivative security may increase or decrease, depending upon
changes in the reference index or the instrument to which it relates.

There is a range of risks associated with derivative investments, including
but not limited to:

* the risk that the underlying security, interest rate, market index or
other financial asset will not move in the direction the portfolio
manager anticipates;

* the risk that adverse price movements in an instrument will result in a
loss substantially greater than a fund's initial investment; and

* the risk that the counterparty will fail to perform its obligations.

No purchases will be made of index/structured securities having "leverage"
characteristics. This means that no investments will be made in securities whose
change in return, interest rate or value at maturity is a multiple of the change
in the reference index. In no event will an index/structured security be
purchased if its addition to the fund's fixed income portfolio would cause the
expected interest rate characteristics of its fixed income portfolio to fall
outside the expected interest rate characteristics of a fund having the same
permissible weighted average portfolio maturity range that does not invest in
index/structured securities.

SHORT SALES

The fund may engage in short sales if, at the time of the short sale, the
fund owns or has the right to acquire securities equivalent in kind and amount
to the securities being sold short. Such transactions allow the fund to hedge
against the price fluctuations by locking in a sale price for securities it does
not wish to sell immediately.

WHEN-ISSUED SECURITIES

PROSPECTUS INFORMATION REGARDING THE FUND 9

equal to the when-issued commitments will be established and maintained with the
custodian. No income will accrue to the fund prior to delivery.

RULE 144A SECURITIES

With respect to securities eligible for resale under Rule 144A, the staff of
the SEC has taken the position that the liquidity of such securities in the
portfolio of a fund offering redeemable securities is a question of fact for the
Board of Directors to determine, such determination to be based upon a
consideration of the readily available trading markets and the review of any
contractual restrictions. The staff also acknowledges that, while the Board
retains ultimate responsibility, it may delegate this function to the manager.
Accordingly, the Board has established guidelines and procedures for determining
the liquidity of Rule 144A securities and has delegated the day-to-day function
of determining the liquidity of 144A securities to the manager. The Board
retains the responsibility to monitor the implementation of the guidelines and
procedures it has adopted.

PORTFOLIO TURNOVER

The total portfolio turnover rate of the fund is shown in the Financial
Highlights table on page 4 of this Prospectus.

PERFORMANCE ADVERTISING

A quotation of yield reflects the fund's income over a stated period
expressed as a percentage of the fund's share price.

Yields are calculated according to accounting methods that are standardized
in accordance with

10 INFORMATION REGARDING THE FUND AMERICAN CENTURY INVESTMENTS

SEC rules for all stock and bond funds. Because yield accounting methods differ
from the methods used for other accounting purposes, the fund's yield may not
equal income paid on your shares or the income reported in the fund's financial
statements.

The fund also may include in advertisements data comparing performance with
the performance of non-related investment media, published editorial comments
and performance rankings compiled by independent organizations (such as Lipper
Analytical Services, Inc. or Donoghue's Money Fund Report) and publications that
monitor the performance of mutual funds. Performance information may be quoted
numerically or may be represented in a table, graph or other illustration. In
addition, fund performance may be compared to well-known indices of market
performance, including the S&P 500 Index, the Dow Jones Industrial Average,
Donoghue's Money Fund Average, the Shearson Lehman Intermediate Government Bond
Index, the constant maturity five-year U.S. Treasury Note Index and the Bank
Rate Monitor National Index of 2 (1)/(2) -year CD rates. Fund performance also
may be compared to the rankings prepared by Lipper Analytical Services, Inc.
Fund performance also may be compared, on a relative basis, to other funds in
our fund family. This relative comparison, which may be based upon historical
fund performance or historical or expected volatility or other fund
characteristics, may be presented numerically, graphically or in text.

PROSPECTUS INFORMATION REGARDING THE FUND 11

ADDITIONAL INFORMATION YOU SHOULD KNOW

SHARE PRICE

PURCHASE AND REDEMPTION OF SHARES

For instructions on how to purchase and redeem shares, read the prospectus
of your insurance company separate account.

WHEN SHARE PRICE IS DETERMINED

The price of VP Advantage shares is also referred to as their net asset
value. Net asset value is determined by calculating the total value of the
fund's assets, deducting total liabilities and dividing the result by the number
of shares outstanding. Net asset value is determined at the close of regular
trading on each day that the New York Stock Exchange is open. Investments and
requests to redeem shares received by the separate account before the close of
business of the Exchange, usually 3 p.m. Central time, are effective, and will
receive the price determined, that day as of the close of the Exchange.
Investment, redemption and exchange requests received thereafter are effective
on, and receive the price determined as of the close of the Exchange on, the
next day the Exchange is open.

HOW SHARE PRICE IS DETERMINED

The valuation of assets for determining net asset value may be summarized as
follows:

If an event were to occur after the value of a security was established but
before the net asset value per share was determined that was likely to
materially

12 ADDITIONAL INFORMATION YOU SHOULD KNOW AMERICAN CENTURY INVESTMENTS

change the net asset value, then that security would be valued at fair value as
determined in accordance with procedures adopted by the Board of Directors.

DISTRIBUTIONS

In general, distributions from net investment income and net realized
securities gains, if any, are declared and paid once a year, but the fund may
make distributions on a more frequent basis to comply with the Internal Revenue
Code, in all events in a manner consistent with the provisions of the Investment
Company Act. All distributions from the fund will be reinvested in additional
shares.

TAXES

MANAGEMENT

INVESTMENT MANAGEMENT

The portfolio manager members of the VP Advantage team and their work
experience for the last five years are as follows:

JAMES E. STOWERS III, Chief Executive Officer and Portfolio Manager, joined
American Century in 1981. He is a member of the team that manages the equity
portion of VP Advantage.

JEFFREY L. HOUSTON, Portfolio Manager, has worked for American Century since
November 1990. He is a member of the team that manages the fixed income portion
of VP Advantage.

PROSPECTUS ADDITIONAL INFORMATION YOU SHOULD KNOW 13

CODE OF ETHICS

TRANSFER AND ADMINISTRATIVE SERVICES

American Century Services Corporation, American Century Tower, 4500 Main
Street, Kansas City, Missouri 64111, acts as transfer agent and dividend-paying
agent for the fund. It provides facilities, equipment and personnel to the fund
and is paid for such services by the manager. Certain recordkeeping and
administrative services that would otherwise be performed by the manager agent
may be performed by the insurance company that purchases the fund's shares, and
the transfer may pay the insurance company for such services.

The manager and the transfer agent are both wholly owned by American Century
Companies, Inc. James E. Stowers Jr., chairman of the fund's Board of Directors,
controls American Century Companies, Inc. by virtue of his ownership of a
majority of its common stock.

DISTRIBUTION OF FUND SHARES

FURTHER INFORMATION ABOUT AMERICAN CENTURY

American Century Variable Portfolios, Inc., the issuer of the fund, was
organized as a Maryland cor-

14 ADDITIONAL INFORMATION YOU SHOULD KNOW AMERICAN CENTURY INVESTMENTS

poration on June 4, 1987. It is a diversified, open-end management investment
company. Its business and affairs are managed by its officers under the
direction of its Board of Directors.

PROSPECTUS ADDITIONAL INFORMATION YOU SHOULD KNOW 15

NOTES

16 NOTES AMERICAN CENTURY INVESTMENTS

NOTES

17 NOTES

P.O. BOX 419385
KANSAS CITY, MISSOURI
64141-6385

INSTITUTIONAL SERVICES:
1-800-345-3533 OR 816-531-5575

TELECOMMUNICATIONS DEVICE FOR THE DEAF:
1-800-345-1833 OR 816-444-3038

FAX: 816-340-4360

www.americancentury.com

[american century logo(reg.sm)]
American
Century(reg.tm)

9803 [recycled logo]
SH-BKT-11941 Recycled
<PAGE>
PROSPECTUS

[american century logo(reg.sm)]
American
Century(reg.tm)

MAY 1, 1998

AMERICAN CENTURY
VARIABLE
PORTFOLIOS, INC.

VP International

PROSPECTUS

MAY 1, 1998

VP International

AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.

American Century Variable Portfolios, Inc. is a part of American Century
Investments, a family of funds that includes nearly 70 no-load mutual funds
covering a variety of investment opportunities. Variable Portfolios offers its
shares only to insurance companies to fund the benefits of variable annuity or
variable life insurance contracts. One of the funds, VP International, is
described in this Prospectus. The other funds are described in separate
prospectuses. You should consult the prospectus of the separate account of the
specific insurance product that accompanies this Prospectus to see which series
of Variable Portfolios are available for purchase for such insurance product.

This Prospectus gives you information about the fund that you should know
before investing. Please read this Prospectus carefully and retain it for future
reference.

PROSPECTUS 1

INVESTMENT OBJECTIVE OF THE FUND

AMERICAN CENTURY VP INTERNATIONAL

VP International seeks capital growth. The fund will seek to achieve its
investment objective by investing primarily in an internationally diversified
portfolio of common stocks that are considered by management to have prospects
for appreciation. The fund will invest primarily in securities of issuers
located in developed markets. Investment in securities of foreign issuers
typically involves a greater degree of risk than investment in domestic
securities. See "Risk Factors," page 6.

There is no assurance that the fund will achieve its investment objective.

2 INVESTMENT OBJECTIVE AMERICAN CENTURY INVESTMENTS

TABLE OF CONTENTS

Investment Objective of the Fund .......................................... 2
Financial Highlights ...................................................... 4

INFORMATION REGARDING THE FUND

Investment Policies of the Fund ........................................... 5
Risk Factors .............................................................. 6
Shareholders of Variable Portfolios ....................................... 7
Other Investment Practices, Their Characteristics
and Risks ............................................................... 7
Forward Currency Exchange Contracts ................................... 7
Derivative Securities ................................................. 8
Indirect Foreign Investment ........................................... 9
Sovereign Debt Obligations ............................................ 9
Repurchase Agreements ................................................. 9
When-Issued Securities ................................................ 9
Short Sales ........................................................... 10
Rule 144A Securities .................................................. 10
Portfolio Turnover .................................................... 10
Performance Advertising ................................................... 10

ADDITIONAL INFORMATION YOU SHOULD KNOW

PROSPECTUS TABLE OF CONTENTS 3

<TABLE>

<CAPTION>
FINANCIAL HIGHLIGHTS
VP INTERNATIONAL

The Financial Highlights for the fiscal year ended December 31, 1997, have
been audited by Deloitte & Touche LLP independent auditors, whose report thereon
appears in the fund's annual report, which is incorporated by reference into the
Statement of Additional Information. The annual report contains additional
performance information and will be made available upon request and without
charge. The Financial Highlights for the periods ended on or before December 31,
1996, have been audited by other independent auditors. The information presented
is for a share outstanding throughout the years ended December 31, except as
noted.

1997 1996 1995 1994(1)

PER-SHARE DATA

<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ......... $5.96 $5.33 $4.75 $5.00
-------- -------- -------- --------
Income From Investment Operations

Net Investment Income (Loss) ............... (0.02) 0.02(2) 0.03(2) --

Net Realized and Unrealized
Gain (Loss) on Investment Transactions ..... 1.11 0.74 0.55 (0.25)
-------- -------- -------- --------
Total From Investment Operations ........... 1.09 0.76 0.58 (0.25)
-------- -------- -------- --------
Distributions

From Net Investment Income ................. (0.06) (0.03) -- --

In Excess of Net Investment Income ......... (0.01) (0.07) -- --

From Net Realized Gains
on Investment Transactions ................. (0.14) (0.03) -- --
-------- -------- -------- --------
Total Distributions ........................ (0.21) (0.13) -- --
-------- -------- -------- --------
Net Asset Value, End of Period ............... $6.84 $5.96 $5.33 $4.75
======== ======== ======== ========
TOTAL RETURN(3) ............................ 18.63% 14.41% 12.21% (5.00)%

RATIOS/SUPPLEMENTAL DATA

Ratio of Operating Expenses
to Average Net Assets ........................ 1.50% 1.50% 1.50% 1.50%(4)

Ratio of Net Investment Income (Loss)
to Average Net Assets ........................ (0.08)% 0.31% 0.70% (0.11)%(4)

Portfolio Turnover Rate ...................... 173% 154% 214% 157%

Average Commission Paid per Share
of Equity Security Traded .................... $0.0076 $0.0225 $0.0020 --(5)

Net Assets, End of Period (in thousands) ..... $216,523 $101,335 $51,609 $17,993
</TABLE>
- ----------

(1) May 1, 1994 (inception) through December 31, 1994.

(2) Computed using average shares outstanding throughout the period.

(3) Total return assumes reinvestment of dividends and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized.

(4) Annualized.

(5) Disclosure of average commission paid per share of equity security traded
was not required prior to the year ended December 31, 1995.

4 FINANCIAL HIGHLIGHTS AMERICAN CENTURY INVESTMENTS

INFORMATION REGARDING THE FUND

INVESTMENT POLICIES OF THE FUND

VP International seeks capital growth. The fund will seek to achieve its
investment objective by investing primarily in securities of foreign companies
that meet certain fundamental and technical standards of selection and have, in
the opinion of the investment manager, potential for appreciation. The fund will
invest primarily in common stocks (defined to include depositary receipts for
common stocks and other equity equivalents) of such companies. The fund tries to
stay fully invested in such securities, regardless of the movement of stock
prices generally.

Although the primary investment of the fund will be common stocks, the fund
may also invest in other types of securities consistent with the accomplishment
of the fund's objectives. When the manager believes that the total capital
growth potential of other securities equals or exceeds the potential return of
common stocks, the fund may invest up to 35% of its assets in such other
securities.

The other securities the fund may invest in are convertible securities,
preferred stocks, bonds, notes and debt securities of companies, and obligations
of domestic or foreign governments and their agencies. The fund will limit its
purchases of debt securities to investment-grade obligations. For long-term debt
obligations this includes securities that are rated Baa or better by Moody's
Investor Services, Inc. (Moody's) or BBB or better by Standard & Poor's
corporation (S&P), or that are not rated but considered by the manager to be of
equivalent quality. According to Moody's, bonds rated Baa are medium grade and
possess some speculative characteristics. A BBB rating by S&P indicates S&P's
belief that a security exhibits a satisfactory degree of safety and capacity for
repayment but is more vulnerable to adverse economic conditions or changing
circumstances than higher-rated securities.

The fund may make foreign investments either directly in foreign securities
or indirectly by purchasing depositary receipts or depositary shares or similar
instruments (collectively "depositary receipts") for foreign securities.
Depositary receipts are securities listed on exchanges or quoted in the
over-the-counter markets in one country but represent shares of issuers
domiciled in another country. Depositary receipts may be sponsored or
unsponsored. Direct investments in foreign securities may be made either on
foreign securities exchanges or on the over-the-counter markets.

Notwithstanding the fund's investment objective of capital growth, under
exceptional market or economic conditions, the fund may temporarily invest all
or a substantial portion of its assets in cash or investment-grade short-term
securities (denominated in U.S. dollars or foreign currencies). To the extent
the fund assumes a defensive position, it will not be pursuing its investment
objective of capital growth.

Under normal conditions, the fund will invest at least 65% of its assets in
common stocks or other equity equivalents of issuers from at least three
countries outside of the United States. While securities of U.S. issuers may be
included in the portfolio from time to time, it is the primary intent of the
manager to diversify investments across a broad range of foreign issuers.
Management defines "foreign issuer" as an issuer of securities that is domiciled
outside the United States, derives at least 50% of its total revenue from
production or sales outside the United States,

PROSPECTUS INFORMATION REGARDING THE FUND 5

and/or whose shares trade principally on an exchange or other market outside the
United States.

In order to achieve maximum investment flexibility, the fund has not
established geographic limits on asset distribution on either a
country-by-country or region-by-region basis. The investment manager expects to
invest both in issuers whose principal place of business is located in countries
with developed economies (such as Germany, the United Kingdom and Japan) and in
issuers whose principal place of business is located in countries with less
developed economies (such as Portugal, Malaysia and Mexico).

The principal criterion for inclusion of a security in the fund's portfolio
is its ability to meet the fundamental and technical standards of selection and,
in the opinion of the fund's investment manager, to achieve better-than-average
appreciation. If, in the opinion of the fund's investment manager, a particular
security satisfies this principal criterion, the security may be included in the
fund's portfolio, regardless of the location of the issuer or the percentage of
the fund's investments in the issuer's country or region.

At the same time, however, the investment manager recognizes that both the
selection of the fund's individual securities and the allocation of the
portfolio's assets across different countries and regions are important factors
in managing an international equity portfolio. For this reason, the manager also
will consider a number of other factors in making investment selections
including: the prospects for relative economic growth among countries or
regions, economic and political conditions, expected inflation rates, currency
exchange fluctuations and tax considerations.

RISK FACTORS

Investing in securities of foreign issuers generally involves greater risks
than investing in the securities of domestic companies. As with any investment
in securities, the value of an investment in the fund can decrease as well as
increase, depending upon a variety of factors which may affect the values and
income generated by the fund's portfolio securities. Potential investors should
carefully consider the following factors before investing:

Currency Risk. The value of the fund's foreign investments may be
significantly affected by changes in currency exchange rates. The dollar value
of a foreign security generally decreases when the value of the dollar rises
against the foreign currency in which the security is denominated and tends to
increase when the value of the dollar falls against such currency. In addition,
the value of the fund's assets may be affected by losses and other expenses
incurred in converting between various currencies in order to purchase and sell
foreign securities and by currency restrictions, exchange control regulation,
currency devaluations and political developments.

Political and Economic Risk. The economies of many of the countries in which
the fund invests are not as developed as the economy of the United States and
may be subject to significantly different forces. Political or social
instability, expropriation or confiscatory taxation, and limitations on the
removal of funds or other assets could also adversely affect the value of
investments. Investments in lesser developed countries will involve exposure to
economic structures that are generally less diverse and mature than in the
United States or other developed countries and to political systems that can be
expected to be less stable than those of more developed countries. A developing
country can be considered to be a country that is in the initial stages of its
industrialization cycle. Historically, markets of developing countries have been
more volatile than the markets of developed countries. The fund has no limit
with respect to investments in lesser developed countries.

Regulatory Risk. Foreign companies are generally not subject to the
regulatory controls imposed on U.S. issuers and, in general, there is less
publicly available information about foreign securities than is available about
domestic securities. Many foreign companies are not subject to uniform
accounting, auditing and financial reporting standards, practices and
requirements comparable to those applicable to domestic companies. Income from
foreign securities owned by the fund may be reduced by a withholding tax at the
source that would reduce dividends paid by the fund.

Market and Trading Risk. Brokerage commission rates in foreign countries,
which are generally fixed rather than subject to negotiation as in the United
States, are likely to be higher. The securities markets in many of the countries
in which the fund invests will have substantially less trading volume than the

6 INFORMATION REGARDING THE FUND AMERICAN CENTURY INVESTMENTS

principal U.S. markets. As a result, the securities of some companies in these
countries may be less liquid and more volatile than comparable U.S. securities.
Furthermore, one securities broker may represent all or a significant part of
the trading volume in a particular country, resulting in higher trading costs
and decreased liquidity due to a lack of alternative trading partners. There is
generally less government regulation and supervision of foreign stock exchanges,
brokers and issuers, which may make it difficult to enforce contractual
obligations.

Clearance and Settlement Risk. Foreign securities markets also have
different clearance and settlement procedures, and in certain markets there have
been times when settlements have been unable to keep pace with the volume of
securities transactions, making it difficult to conduct such transactions.
Delays in clearance and settlement could result in temporary periods when assets
of the fund are uninvested and no return is earned thereon. The inability of the
fund to make intended security purchases due to clearance and settlement
problems could cause the fund to miss attractive investment opportunities.
Inability to dispose of portfolio securities due to clearance and settlement
problems could result either in losses to the fund due to subsequent declines in
value of the portfolio security or, if the fund has entered into a contract to
sell the security, liability to the purchaser.

Ownership Risk. Evidence of securities ownership may be uncertain in many
foreign countries. In many of these countries, the most notable of which is the
Russian Federation, the ultimate evidence of securities ownership is the share
register held by the issuing company or its registrar. While some companies may
issue share certificates or provide extracts of the company's share register,
these are not negotiable instruments and are not effective evidence of
securities ownership. In an ownership dispute, the company's share register is
controlling. As a result, there is a risk that the fund's trade details could be
incorrectly or fraudulently entered on the issuer's share register at the time
of the transaction, or that the fund's ownership position could thereafter be
altered or deleted entirely resulting in a loss to the fund. While the fund
intends to invest directly in Russia only in companies which utilize an
independent registrar, there can be no assurance that such investments will not
result in a loss to the fund.

SHAREHOLDERS OF VARIABLE PORTFOLIOS

Variable Portfolios will offer its shares only to insurance companies for
the purpose of funding variable annuity or variable life insurance contracts.
Although Variable Portfolios does not foresee any disadvantages to contract
owners due to the fact that it offers its shares as an investment medium for
both variable annuity and variable life products, the interests of various
contract owners participating in the funds of Variable Portfolios might, at some
time, be in conflict due to future differences in tax treatment of variable
products or other considerations. Consequently, Variable Portfolios' Board of
Directors will monitor events in order to identify any material irreconcilable
conflicts that may possibly arise and to determine what action, if any, should
be taken in response to such conflicts. If a conflict were to occur, an
insurance company separate account might be required to withdraw its investments
in the fund and the fund might be forced to sell securities at disadvantageous
prices to fund such withdrawal.

OTHER INVESTMENT PRACTICES, THEIR CHARACTERISTICS
AND RISKS

For additional information, see "Investment Restrictions Applicable to all
Series of Shares" in the Statement of Additional Information.

FORWARD CURRENCY EXCHANGE CONTRACTS

Some of the foreign securities held by the fund will be denominated in
foreign currencies. Other securities, such as depositary receipts, may be
denominated in U.S. dollars or the currency of the country where issued (if not
U.S. dollars), but have a value that is dependent upon the performance of a
foreign security, as valued in the currency of its home country. As a result,
the value of the fund's portfolio may be affected by changes in the exchange
rate between foreign currencies and the U.S. dollar as well as by changes in the
market value of the securities themselves. The performance of foreign currencies
relative to the U.S. dollar may be an important factor in the overall
performance of the fund.

To protect against adverse movements in exchange rates between currencies,
the fund may, for hedging

PROSPECTUS INFORMATION REGARDING THE FUND 7

purposes only, enter into forward currency exchange contracts. A forward
currency exchange contract obligates the fund to purchase or sell a specific
currency at a future date at a specific price.

The fund may elect to enter into a forward currency exchange contract with
respect to a specific purchase or sale of a security, or with respect to the
fund's portfolio positions generally.

When the manager believes that a particular currency may decline in value
compared to the U.S. dollar, the fund may enter into foreign currency exchange
contracts to sell the value of some or all of the fund's portfolio securities
either denominated in, or whose value is tied to, that currency. This practice
is sometimes referred to as "portfolio hedging." The fund may not enter into a
portfolio hedging transaction where the fund would be obligated to deliver an
amount of foreign currency in excess of the aggregate value of its portfolio
securities or other assets denominated in, or whose value is tied to, that
currency.

If the fund enters into a forward currency exchange contract, the fund, when
required, will instruct its custodian bank to segregate cash or liquid
high-grade securities in a separate account in an amount sufficient to cover its
obligation under the contract. Those assets will be valued at market daily, and
if the value of the segregated securities declines, additional cash or
securities will be added so that the value of the account is not less than the
amount of the fund's commitment. At any given time, no more than 15% of the
fund's assets will be committed to a segregated account in connection with
portfolio hedging transactions.

DERIVATIVE SECURITIES

To the extent permitted by its investment objective and policies, the fund
may invest in securities that are commonly referred to as "derivative"
securities. Generally, a derivative is a financial arrangement the value of
which is based on, or "derived" from, a traditional security, asset, or market
index. Certain derivative securities are more accurately described as
"index/structured securities." Index/structured securities are derivative
securities whose value or performance is linked to other equity securities (such
as depositary receipts), currencies, interest rates, indexes or other financial
indicators (reference indices). The fund may not invest in an index/structured
security unless the reference index or the instrument to which it relates is an
eligible investment for the fund. For example, a security whose underlying value
is linked to the price of oil would not be a permissible investment because the
fund may not invest in oil and gas leases or futures.

The return on a derivative security may increase or decrease, depending upon
changes in the reference index or the instrument to which it relates.

There is a range of risks associated with derivative investments, including
but not limited to:

* the risk that the underlying security, interest rate, market index or
other financial asset will not move in the direction the portfolio
manager anticipates;

* the risk that adverse price movements in an instrument will result in a
loss substantially greater than a fund's initial investment; and

* the risk that the counterparty will fail to perform its obligations.

8 INFORMATION REGARDING THE FUND AMERICAN CENTURY INVESTMENTS

INDIRECT FOREIGN INVESTMENT

Subject to certain restrictions contained in the Investment Company Act, the
fund may invest in certain foreign countries indirectly through investment funds
and registered investment companies authorized to invest in those countries. If
the fund invests in investment companies, the fund will bear its proportionate
shares of the costs incurred by such companies, including investment advisory
fees, if any.

SOVEREIGN DEBT OBLIGATIONS

The fund may purchase sovereign debt instruments issued or guaranteed by
foreign governments or their agencies. Sovereign debt instruments may be in the
form of conventional securities or other types of debt instruments such as loans
or loan participations.

REPURCHASE AGREEMENTS

Since the security purchased constitutes security for the repurchase
obligation, a repurchase agreement can be considered a loan collateralized by
the security purchased. The fund's risk is the ability of the seller to pay the
agreed-upon repurchase price on the repurchase date. If the seller defaults, the
fund may incur costs in disposing of the collateral, which would reduce the
amount realized thereon. If the seller seeks relief under the bankruptcy laws,
the disposition of the collateral may be delayed or limited. To the extent the
value of the security decreases, the fund could experience a loss.

The fund will limit repurchase agreement transactions to securities issued
by the U.S. government, its agencies and instrumentalities, and will enter into
such transactions only with commercial banks and securities dealers who are
deemed creditworthy pursuant to criteria adopted by the fund's Board of
Directors.

The fund will not invest more than 15% of its assets in repurchase
agreements maturing in more than seven days.

WHEN-ISSUED SECURITIES

PROSPECTUS INFORMATION REGARDING THE FUND 9

SHORT SALES

RULE 144A SECURITIES

With respect to securities eligible for resale under Rule 144A, the staff of
the SEC has taken the position that the liquidity of such securities in the
portfolio of a fund offering redeemable securities is a question of fact for the
Board of Directors to determine, such determination to be based upon a
consideration of the readily available trading markets and the review of any
contractual restrictions. The staff also acknowledges that, while the Board
retains ultimate responsibility, it may delegate this function to the manager.
Accordingly, the Board has established guidelines and procedures for determining
the liquidity of Rule 144A securities and has delegated the day-to-day function
of determining the liquidity of 144A securities to the manager. The Board
retains the responsibility to monitor the implementation of the guidelines and
procedures it has adopted.

PORTFOLIO TURNOVER

The total portfolio turnover rate of the fund is shown in the Financial
Highlights table on page 4 of this Prospectus.

PERFORMANCE ADVERTISING

The fund may also include in advertisements data comparing performance with
the performance of non-related investment media, published editorial

10 INFORMATION REGARDING THE FUND AMERICAN CENTURY INVESTMENTS

comments and performance rankings compiled by independent organizations (such as
Lipper Analytical Services, Inc. or Donoghue's Money Fund Report) and
publications that monitor the performance of mutual funds. Performance
information may be quoted numerically or may be represented in a table, graph or
other illustration. In addition, fund performance may be compared to well-known
indices of market performance, including the S&P 500 Index, the Dow Jones
Industrial Average, the Dow Jones World Index and the Morgan Stanley Capital
International Europe, Australia, Far East (EAFE) Index. Fund performance may
also be compared to the rankings prepared by Lipper Analytical Services, Inc.
Fund performance also may be compared, on a relative basis, to other funds in
our fund family. This relative comparison, which may be based upon historical
fund performance or historical or expected volatility or other fund
characteristics, may be presented numerically, graphically or in text.

PROSPECTUS INFORMATION REGARDING THE FUNDS 11

ADDITIONAL INFORMATION YOU SHOULD KNOW

SHARE PRICE

PURCHASE AND REDEMPTION OF SHARES

For instructions on how to purchase and redeem shares, read the prospectus
of your insurance company separate account.

WHEN SHARE PRICE IS DETERMINED

The price of VP International shares is also referred to as their net asset
value. Net asset value is determined by calculating the total value of the
fund's assets, deducting total liabilities and dividing the result by the number
of shares outstanding. Net asset value is determined at the close of regular
trading on each day that the New York Stock Exchange is open. Investments and
requests to redeem shares received by the separate account before the close of
business of the Exchange, usually 3 p.m. Central time, are effective on, and
will receive the price determined, that day as of the close of the Exchange.
Investment, redemption and exchange requests received thereafter are effective
on, and receive the price determined as of the close of the Exchange on the next
day the Exchange is open.

HOW SHARE PRICE IS DETERMINED

The valuation of assets for determining net asset value may be summarized as
follows:

The portfolio securities of the fund, except as otherwise noted, listed or
traded on a domestic securities exchange are valued at the last sale price on
that exchange. Portfolio securities primarily traded on foreign securities
exchanges generally are valued at the preceding closing value of such security
on the exchange where primarily traded. If no sale is reported, or if local
convention or regulation so provides, the mean of the latest bid and asked
prices is used. Depending on local convention or regulation, securities traded
over-the-counter are priced at the mean of the latest bid and asked prices, or
at the last sale price. When market quotations are not readily available,
securities and other assets are valued at fair value as determined in accordance
with procedures adopted by the Board of Directors.

The value of an exchange-traded foreign security is determined in its
national currency as of the close of trading on the foreign exchange on which it
is traded or as of the close of business on the New York Stock Exchange, if that
is earlier. That value is then converted to U.S. dollars at the prevailing
foreign exchange rate. Trading in securities on European and Far Eastern
securities exchanges and over-the-counter markets is normally completed at
various times before the close of business on each day that the New York Stock
Exchange is open.

If an event were to occur after the value of a security was established but
before the net asset value per share was determined that was likely to
materially

12 ADDITIONAL INFORMATION YOU SHOULD KNOW AMERICAN CENTURY INVESTMENTS

change the net asset value, then that security would be valued at fair value as
determined in accordance with procedures adopted by the Board of Directors.

Trading of these securities in foreign markets may not take place on every
New York Stock Exchange business day. In addition, trading may take place in
various foreign markets on Saturdays or on other days when the New York Stock
Exchange is not open and on which a fund's net asset value is not calculated.
Therefore, such calculation does not take place contemporaneously with the
determination of the prices of many of the portfolio securities used in such
calculation and the value of the fund's portfolio may be significantly affected
on days when shares of the fund may not be purchased or redeemed.

DISTRIBUTIONS

In general, distributions from net investment income and net realized
securities gains, if any, are declared and paid once a year, but the fund may
make distributions on a more frequent basis to comply with the distributions
requirements of the Internal Revenue Code, in all events in a manner consistent
with the provisions of the Investment Company Act. All distributions from the
fund will be reinvested in additional shares.

TAXES

MANAGEMENT

INVESTMENT MANAGEMENT

The portfolio manager members of the VP International team and their
principal work experience during the past five years are as follows:

HENRIK STRABO, Senior Vice President and Portfolio Manager, joined American
Century in 1993 as an Investment Analyst and has been a portfolio manager member
of the VP International team since its inception in 1994. Prior to joining
American Century, Mr. Strabo was Vice President, International Equity Sales with
Barclays de Zoete Wedd (1991 to 1993) and obtained international equity sales
experience at Cresvale International from 1990 to 1991.

MARK S. KOPINSKI, Vice President and Portfolio Manager, rejoined American
Century in April 1997. From June 1995 to March 1997, Mr. Kopinski served as Vice
President and Portfolio Manager for Federated Investors, Inc. Prior to June
1995, Mr. Kopinski was a Vice President and Portfolio Manager for American
Century.

The activities of the manager are subject only to directions of the fund's
Board of Directors. The manager pays all the expenses of the funds except
brokerage, taxes, interest, fees and expenses of the non-interested person
directors (including counsel fees) and extraordinary expenses.

PROSPECTUS ADDITIONAL INFORMATION YOU SHOULD KNOW 13

For the services provided to the fund, the manager is paid a fee of 1.5% of
the average net assets of the fund. On the first business day of each month,
each series of shares pays a management fee to the manager for the previous
month at the rate specified. The fee for the previous month is calculated by
multiplying the applicable fee for such series by the aggregate average daily
closing value of the series' net assets during the previous month, and further
multiplying that product by a fraction, the numerator of which is the number of
days in the previous month and the denominator of which is 365 (366 in leap
years).

CODE OF ETHICS

TRANSFER AND ADMINISTRATIVE SERVICES

American Century Services Corporation, American Century Tower, 4500 Main
Street, Kansas City, Missouri 64111, acts as transfer agent and dividend-paying
agent for the fund. It provides facilities, equipment and personnel to the fund,
and is paid for such services by the manager. Certain recordkeeping and
administrative services that would otherwise be performed by the transfer agent
may be performed by the insurance company that purchases the fund's shares, and
the manager may pay the insurance company for such services.

The manager and the transfer agent are both wholly owned by American Century
Companies, Inc. James E. Stowers Jr., chairman of the fund's Board of Directors,
controls American Century Companies, Inc. by virtue of his ownership of a
majority of its common stock.

DISTRIBUTION OF FUND SHARES

FURTHER INFORMATION ABOUT AMERICAN CENTURY

The principal office of the fund is American Century Tower, 4500 Main
Street, P.O. Box 419385, Kansas City, Missouri 64141-6385. All inquiries may be
made by mail to that address, or by telephone to 816-531-5575.

Each share, irrespective of series, is entitled to one vote for each dollar
of net asset value applicable to such share on all questions, except for those
matters

14 ADDITIONAL INFORMATION YOU SHOULD KNOW AMERICAN CENTURY INVESTMENTS

which must be voted on separately by the series of shares affected. Matters
affecting only one series are voted upon only by that series.

PROSPECTUS ADDITIONAL INFORMATION YOU SHOULD KNOW 15

NOTES

16 NOTES AMERICAN CENTURY INVESTMENTS

NOTES

PROSPECTUS NOTES 17

P.O. Box 419385
Kansas City, Missouri
64141-6385

Institutional Services:
1-800-345-3533 or 816-531-5575

Telecommunications Device for the Deaf:
1-800-345-1833 or 816-444-3038

Fax: 816-340-4360

www.americancentury.com

[american century logo(reg.sm)]
American
Century(reg.tm)

9803 [recycled logo]
SH-BKT-11940 Recycled
<PAGE>
PROSPECTUS

[american century logo(reg.sm)]
American
Century(reg.tm)

MAY 1, 1998

AMERICAN CENTURY
VARIABLE
PORTFOLIOS, INC.

VP Income & Growth

PROSPECTUS
MAY 1, 1998

VP Income & Growth

AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.

American Century Variable Portfolios, Inc. is a part of American Century
Investments, a family of funds that includes nearly 70 no-load mutual funds
covering a variety of investment opportunities. Variable Portfolios offers its
shares only to insurance companies to fund the benefits of variable annuity or
variable life insurance contracts. One of the funds, VP Income & Growth, is
described in this Prospectus. Its investment objective is listed on page 2 of
this Prospectus. The other funds are described in separate prospectuses. You
should consult the prospectus of the separate account of the specific insurance
product that accompanies this Prospectus to see which series of Variable
Portfolios are available for purchase for such insurance product.

This Prospectus gives you information about the fund that you should know
before investing. Please read this Prospectus carefully and retain it for future
reference.

PROSPECTUS 1

INVESTMENT OBJECTIVE OF THE FUND

AMERICAN CENTURY VP INCOME & GROWTH

VP Income & Growth seeks dividend growth, current income and capital
appreciation. The fund will seek to achieve its investment objective by
investing in common stocks.

There is no assurance that the fund will achieve its investment objective.

2 INVESTMENT OBJECTIVE AMERICAN CENTURY INVESTMENTS

TABLE OF CONTENTS

Investment Objective of the Fund .......................................... 2
Financial Highlights ...................................................... 4

INFORMATION REGARDING THE FUND

Investment Policies of the Fund ........................................... 5
Risk Factors and Investment Techniques .................................... 5
Portfolio Optimization ................................................ 5
Investments in Stocks ................................................. 5
Shareholders of Variable Portfolios ....................................... 7
Other Investment Practices, Their Characteristics
and Risks ............................................................... 7
Portfolio Turnover ..................................................... 7
Convertible Securities ................................................. 7
Futures Contracts and Options Thereon .................................. 7
Short-Term Instruments ................................................. 8
Foreign Securities ..................................................... 8
Other Techniques ....................................................... 8
Performance Advertising ................................................... 8

ADDITIONAL INFORMATION YOU SHOULD KNOW

Share Price ............................................................... 10
Purchase and Redemption of Shares ...................................... 10
When Share Price is Determined ......................................... 10
How Share Price is Determined .......................................... 10
Distributions ............................................................. 11
Taxes ..................................................................... 11
Management ................................................................ 11
Investment Management .................................................. 11
Investment Performance of Similar Fund ................................. 11
Code of Ethics ......................................................... 12
Transfer and Administrative Services ................................... 12
Distribution of Fund Shares ............................................... 12
Further Information About American Century ................................ 12

PROSPECTUS TABLE OF CONTENTS 3

FINANCIAL HIGHLIGHTS

VP INCOME & GROWTH

The Financial Highlights for the period ended December 31, 1997, have been
audited by Deloitte & Touche LLP independent auditors, whose report thereon
appears in the fund's annual report, which is incorporated by reference into the
Statement of Additional Information. The annual report contains additional
performance information and will be made available upon request and without
charge.

1997(1)

PER-SHARE DATA

Net Asset Value, Beginning of Period .................. $5.00
-----

Income From Investment Operations

Net Investment Income ............................... 0.02

Net Realized and Unrealized Gain
on Investment Transactions .......................... 0.37
----

Total From Investment Operations .................... 0.39
----

Net Asset Value, End of Period ........................ $5.39
=====

Total Return(2) ..................................... 7.80%

RATIOS/SUPPLEMENTAL DATA

Ratio of Operating Expenses to
Average Net Assets(3) ............................... 0.70%

Ratio of Net Investment Income
to Average Net Assets(3) ............................ 1.94%

Portfolio Turnover Rate ............................. 10%

Average Commission Paid per Share
of Equity Security Traded ..........................$0.0216

Net Assets, End of Period (in thousands) ........... $1,230

(1) October 30, 1997 (inception) through December 31, 1997.

(2) Total return assumes reinvestment of dividends and capital gains
distributions, if any. Total return is not annualized.

(3) Annualized.

4 FINANCIAL HIGHLIGHTS AMERICAN CENTURY INVESTMENTS

INFORMATION REGARDING THE FUND

INVESTMENT POLICIES OF THE FUND

VP Income & Growth seeks dividend growth, current income and capital
appreciation. The fund will seek to achieve its investment objective by
investing in common stocks.

RISK FACTORS AND INVESTMENT TECHNIQUES

PORTFOLIO OPTIMIZATION

The manager uses quantitative management strategies in pursuit of the fund's
investment objective. Quantitative management combines two investment
approaches. The first is to rank stocks based on their relative attractiveness.
The attractiveness of a stock is determined analytically by using a computer
model to combine valuation and growth measures. Examples of valuation measures
include price to book and price to cash flow ratios while examples of growth
measures include the rate of growth of a company's earnings and changes in
analysts' earnings estimates.

The second step is to use a technique referred to as portfolio optimization.
Using a computer, the manager constructs a portfolio (i.e., company names and
shares held in each) which seeks the optimal tradeoff between the risk of the
portfolio relative to a benchmark (i.e., the S&P 500) and the expected return of
the portfolio as measured by the stock ranking model. With respect to the VP
Income & Growth fund, the portfolio optimization includes targeting a dividend
yield that exceeds that of the S&P 500.

The fund's portfolio holdings are drawn primarily from equity securities of
the 1,500 largest companies traded in the United States (ranked by market
capitalization).

The fund's investment approach may cause it to be more heavily invested in
some industries than in others. However, the fund may not invest more than 25%
of its total assets in companies whose principal business activities are in the
same industry. In addition, the fund is a "diversified" investment company as
defined in the Investment Company Act of 1940. This means that investments in
any single issuer are limited to restrictions under the Investment Company Act

The fund may invest in securities or engage in transactions involving
instruments other than equity securities, as discussed in the section titled
"Other Investment Practices, Their Characteristics and Risks," page 7.

INVESTMENTS IN STOCKS

The fund may be an appropriate component of a stock portfolio for investors
seeking total return through diversified investments in stocks, bonds, and
short-term instruments. The fund invests primarily in stocks, which may enhance
inflation-adjusted returns. The following chart illustrates how stocks have
historically outpaced inflation and produced higher returns than bonds. If you
seek a steady stream of monthly investment income, VP Income & Growth may be a
good investment for you. Of course, no single mutual fund can provide a balanced
investment plan.

PROSPECTUS INFORMATION REGARDING THE FUNDS 5

[line chart - data below]

CHART 1-Growth of Stocks, Bonds & Inflation

20-Year U.S.
Treasury Inflation
S&P 500 Bonds (CPI)
1926 1.1162 1.0777 0.9851
1927 1.534663 1.173939 0.96461
1928 2.20393 1.175113 0.955253
1929 2.018359 1.215301 0.957164
1930 1.515788 1.271934 0.899447
1931 0.858845 1.204395 0.813819
1932 0.788506 1.407215 0.729996
1933 1.21422 1.40623 0.733719
1934 1.196735 1.547275 0.748613
1935 1.767219 1.624329 0.770997
1936 2.36666 1.746478 0.780326
1937 1.537619 1.750495 0.804516
1938 2.016126 1.847298 0.782151
1939 2.00786 1.957027 0.778396
1940 1.811491 2.07621 0.785869
1941 1.601539 2.095519 0.862255
1942 1.927293 2.162995 0.942359
1943 2.426461 2.207985 0.972137
1944 2.905687 2.270029 0.99265
1945 3.96452 2.513603 1.014984
1946 3.644583 2.51109 1.199305
1947 3.852689 2.445299 1.307363
1948 4.064587 2.528439 1.342792
1949 4.828323 2.691524 1.318622
1950 6.359384 2.693139 1.39497
1951 7.886908 2.587298 1.476855
1952 9.335732 2.617311 1.489851
1953 9.243309 2.712581 1.499088
1954 14.10714 2.907616 1.491593
1955 18.55935 2.870107 1.497112
1956 19.77684 2.709668 1.539929
1957 17.6449 2.91181 1.586435
1958 25.29573 2.73448 1.614356
1959 28.3211 2.672681 1.638572
1960 28.45421 3.040977 1.662823
1961 36.10554 3.070474 1.673963
1962 32.95353 3.28203 1.694386
1963 40.46693 3.321742 1.722343
1964 47.13588 3.438336 1.742839
1965 53.0043 3.462748 1.776302
1966 47.67207 3.589138 1.835808
1967 59.10383 3.259655 1.891616
1968 65.64072 3.25118 1.9809
1969 60.06125 3.086345 2.101933
1970 62.46971 3.460102 2.21733
1971 71.40913 3.917873 2.291832
1972 84.96258 4.1408 2.369983
1973 72.50707 4.094837 2.578542
1974 53.31445 4.272963 2.893124
1975 73.14742 4.666075 3.095932
1976 90.58576 5.447643 3.244846
1977 84.08171 5.410054 3.464522
1978 89.59747 5.346215 3.777369
1979 106.1192 5.280457 4.280137
1980 140.5231 5.071879 4.810874
1981 133.6234 5.166216 5.240966
1982 162.2322 7.251301 5.443791
1983 198.7506 7.298434 5.650655
1984 211.2123 8.428232 5.873856
1985 279.1382 11.03845 6.0953
1986 330.695 13.74619 6.164177
1987 347.9904 13.37367 6.436017
1988 406.4875 14.6669 6.720489
1989 534.4905 17.32308 7.032992
1990 517.5471 18.39364 7.462708
1991 675.6578 21.94361 7.691067
1992 727.4807 23.71007 7.914108
1993 800.1561 28.03479 8.131746
1994 810.6381 25.85649 8.348863
1995 1114.06 34.04524 8.560925
1996 1371.074 33.72862 8.845147
1997 1828.464 39.0746 9.014974
Source: Ibbotson Associates, Stocks, Bonds, Bills and Inflation.

In contrast to bond investors, common stock investors forego the certainty
of coupon interest payments. However, they enjoy the potential for increased
dividend income if the issuing company prospers. As indicated below, Chart 2
compares the growth of dividends from S&P 500 stocks with the rate of inflation
over a 50-year period.

[line chart - data below]

CHART 2 - Growth of Dividends vs. Inflation

S&P Dividends Growt US Inflation
1947 1 1
1948 1.107468124 1.0271
1949 1.357240437 1.0086122
1950 1.749899506 1.067010846
1951 1.67906509 1.129644383
1952 1.678112081 1.139585254
1953 1.727122009 1.146650682
1954 1.834323144 1.140917429
1955 1.953336156 1.145138823
1956 2.073757617 1.177889794
1957 2.133646437 1.213462065
1958 2.085429362 1.234818998
1959 2.175791302 1.253341283
1960 2.32464435 1.271890734
1961 2.40782098 1.280412402
1962 2.538780149 1.296033433
1963 2.712285326 1.317417985
1964 2.974525751 1.333095259
1965 3.239229065 1.358690688
1966 3.422650159 1.404206826
1967 3.481554958 1.446894713
1968 3.6526313 1.515188144
1969 3.759297323 1.607766139
1970 3.735279865 1.6960325
1971 3.653484903 1.753019192
1972 3.755970092 1.812797147
1973 4.019760745 1.972323295
1974 4.285468336 2.212946738
1975 4.383065522 2.368074304
1976 4.702931359 2.481978678
1977 5.513988379 2.650008634
1978 6.034746841 2.889304414
1979 6.533520366 3.273870832
1980 7.363498287 3.679830815
1981 7.903427763 4.008807689
1982 8.025292477 4.163948547
1983 8.37256877 4.322178592
1984 8.954482394 4.492904646
1985 10.15408848 4.662287151
1986 9.407695282 4.714970996
1987 10.49569776 4.922901217
1988 12.26800301 5.140493451
1989 12.7322013 5.379526396
1990 14.14079945 5.708215459
1991 15.02210794 5.882886852
1992 15.05039433 6.053490571
1993 14.68390978 6.219961562
1994 15.66504401 6.386034535
1995 15.91605134 6.548239813
1996 18.63104529 6.765641374
1997 18.61260496 6.895541689

Sources: Ibbotson Associates, Stocks, Bonds, Bills and Inflation

Historical equity index returns suggest that stocks provide superior
investment returns over the long term. Over short periods of time, however, the
prices of individual stocks and the stock market as a whole can be very
volatile. The following table shows best and worst average annual total returns
for the S&P 500 over time spans of one, five, 10 and 20 years between 1926 and
1997.

VARIABILITY OF S&P 500 RETURNS
- ----------------------------------------------------------------------
1 YR 5 YRS 10 YRS 20 YRS
Best 53.99% 23.92% 20.06% 16.86%
Worst -43.34% -12.47% -0.89% 3.11%
- ----------------------------------------------------------------------

Source: Ibbotson Associates, Stocks, Bonds, Bills and Inflation.
This analysis is based on historical annual total return figures
for the S&P 500.

Notice that the difference between the best and worst return decreases as
the measure of time increases. Stock market investing may not make sense for you
unless you are prepared to ride out the markets' ups and downs.

As indicated below, Chart 3 compares the historical risk vs. reward
characteristics of stocks (represented by the S&P 500), bonds (represented by a
20-year U.S. Treasury bond), and Treasury bills. As you can see, historically,
stocks have provided higher returns at greater risk than Treasury bonds and
bills over the long term.

[bullet chart - data below]

Risk--Reward
S&P 500 Govt. Bonds T-Bills
Average Annual return 12.96% 5.59% 3.81%
Average Annual SD of return (Risk) 20.32% 9.23% 3.24%

Source: Ibbotson Associates, Stocks, Bonds, Bills and Inflation.

The historical S&P 500 data presented here are not intended to suggest that
an investor would have achieved comparable results by investing in any one
equity security or in managed portfolios of equity securities, such as the fund,
during the periods shown. The S&P 500 is an unmanaged index representing the
performance of 500 major companies, most of which are listed on the New York
Stock Exchange. Investors cannot invest directly in the S&P 500. The historical
conditions that gave rise to the patterns illustrated here may not be repeated.
Transaction costs and other expenses of managing a common stock portfolio are
not reflected in the figures shown. S&P 500 is a registered service mark of
Standard and Poor's Corporation.

6 INFORMATION REGARDING THE FUNDS AMERICAN CENTURY INVESTMENTS

SHAREHOLDERS OF VARIABLE PORTFOLIOS

Variable Portfolios will offer its shares only to insurance companies for
the purpose of funding variable annuity or variable life insurance contracts.
Although Variable Portfolios does not foresee any disadvantages to contract
owners due to the fact that it offers its shares as an investment medium for
both variable annuity and variable life products, the interests of various
contract owners participating in the funds of Variable Portfolios might, at some
time, be in conflict due to future differences in tax treatment of variable
products or other considerations. Consequently, Variable Portfolios' Board of
Directors will monitor events in order to identify any material irreconcilable
conflicts that may possibly arise and to determine what action, if any, should
be taken in response to such conflicts. If a conflict were to occur, an
insurance company separate account might be required to withdraw its investments
in the fund and the fund might be forced to sell securities at disadvantageous
prices to fund such withdrawal.

OTHER INVESTMENT PRACTICES, THEIR CHARACTERISTICS
AND RISKS

For additional information, see "Investment Restrictions Applicable to all
Series of Shares" in the Statement of Additional Information.

PORTFOLIO TURNOVER

The total portfolio turnover rate of the fund is shown in the Financial
Highlights table on page 4 of this Prospectus.

Investment decisions to purchase and sell securities are based on the
anticipated contribution of the security in question to the fund's investment
objective. The manager believes that the rate of portfolio turnover is
irrelevant when it determines a change is in order to achieve the objective and
accordingly, under normal conditions the annual portfolio turnover rate is not
anticipated to exceed 150%.

The portfolio turnover of the fund may be higher than other mutual funds
with similar investment objectives. Higher turnover would generate
correspondingly greater brokerage commissions, which is a cost that the fund
pays directly. Higher portfolio turnover also may affect the likelihood that the
capital gains, if any, distributed by the fund will include short-term capital
gains, which are taxable as ordinary income. When a security is sold, the
manager seeks, whenever possible, to minimize the capital gain that would be
realized.

CONVERTIBLE SECURITIES

Although the fund's equity investments consist primarily of common stock,
the fund may buy securities convertible into common stock, such as convertible
bonds, convertible preferred stocks, and warrants. The manager may purchase
these securities if it believes that a company's convertible securities are
undervalued in the market.

FUTURES CONTRACTS AND OPTIONS THEREON

The fund may buy or sell futures contracts relating to groups of securities
or indices and write or buy put and call options relating to such futures
contracts.

For options sold, the fund will segregate cash or appropriate liquid assets
including equity securities and debt securities of any grade equal to the value
of securities underlying the option unless the option is otherwise covered.

The fund will deposit cash or appropriate liquid assets in a segregated
custodial account in an amount equal to the fluctuating market value of long
futures contracts it has purchased, less any margin deposited on its long
position. It may hold cash or acquire such debt obligations for the purpose of
making these deposits.

The fund may use futures and options transactions to maintain cash reserves
while remaining fully invested, to facilitate trading, to reduce transaction
costs, or to pursue higher investment returns when a futures contract is priced
more attractively than its underlying security or index.

Since futures contracts and options thereon can replicate movements in the
cash markets for the securities in which the fund invests without the large cash
investments required for dealing in such markets, they may subject the fund to
greater and more volatile risks than might otherwise be the case. The principal
risks related to the use of such instruments are (1) the offsetting correlation
between movements in the market price of the portfolio investments (held or
intended) being hedged and in the price of the futures contract or option may be
imperfect; (2) possible lack of a liquid secondary market for closing out
futures or option positions; (3) the need of additional portfolio manage-

PROSPECTUS INFORMATION REGARDING THE FUNDS 7

ment skills and techniques; and (4) losses due to unanticipated market price
movements. For a hedge to be completely effective, the price change of the
hedging instrument should equal the price change of the securities being hedged.
Such equal price changes are not always possible because the investment
underlying the hedging instrument may not be the same investment that is being
hedged.

The ordinary spreads between prices in the cash and futures markets, due to
the differences in the nature of those markets, are subject to distortion. Due
to the possibility of distortion, a correct forecast of general interest rate
trends by the manager may still not result in a successful transaction. The
manager may be incorrect in its expectations as to the extent of various
interest rate movements or the time span within which the movements take place.

See the Statement of Additional Information for further information about
these instruments and their risks.

SHORT-TERM INSTRUMENTS

For liquidity purposes, the fund may invest in high-quality money market
instruments with remaining maturities of one year or less. Such instruments may
include U.S. government securities, certificates of deposit, commercial paper,
and bankers' acceptances.

The fund may also enter into repurchase agreements, collateralized by U.S.
government securities, with banks or broker-dealers that are deemed to present
minimal credit risk. Credit risk determinations are made by the manager pursuant
to guidelines established by the Board of Directors. A repurchase agreement
involves the purchase of a security and a simultaneous agreement to sell the
security back to the seller at a higher price. Delays or losses could result if
the other party to the agreement defaults or becomes bankrupt.

The fund may invest up to 5% of its total assets in any money market fund
advised by the manager, provided that the investment is consistent with the
fund's investment policies and restrictions.

FOREIGN SECURITIES

The fund may invest in securities of foreign issuers, including instruments
that trade on domestic or foreign securities exchanges in U. S. dollars or
foreign currencies. Securities of foreign issuers may be affected by the
strength of foreign currencies relative to the U.S. dollar or by political or
economic developments in foreign countries. Foreign companies may not be subject
to accounting standards or governmental regulations comparable to those that
affect U.S. companies, and there may be less public information about their
operations.

OTHER TECHNIQUES

The manager may buy other types of securities or employ other portfolio
management techniques on behalf of the fund. When SEC guidelines require it to
do so, the fund will set aside cash or appropriate liquid assets in a segregated
account to cover its obligations. See the Statement of Additional Information
for a more detailed discussion of these investments and some of the risks
associated with them.

PERFORMANCE ADVERTISING

A quotation of yield reflects the fund's income over a stated period of time
expressed as a percentage of the fund's share price. The effective yield is
calculated in a similar manner but, when annualized, the income earned by the
investment is assumed to be reinvested. The effective yield will be slightly
higher than the yield because of the compounding effect on the assumed
reinvestment.

Yield is calculated by adding over a 30-day (or one-month) period all
interest and dividend income (net of fund expenses) calculated on each

8 INFORMATION REGARDING THE FUNDS AMERICAN CENTURY INVESTMENTS

day's market values, dividing this sum by the average number of fund shares
outstanding during the period, and expressing the result as a percentage of the
fund's share price on the last day of the 30-day (or one month) period. The
percentage is then annualized. Capital gains and losses are not included in the
calculation.

Yields are calculated according to accounting methods that are standardized
in accordance with SEC rules. The SEC yield should be regarded as an estimate of
the fund's rate of investment income, and it may not equal the fund's actual
income distribution rate, the income paid to a shareholder's account, or the
income reported in the fund's financial statements.

PROSPECTUS INFORMATION REGARDING THE FUNDS 9

ADDITIONAL INFORMATION YOU SHOULD KNOW

SHARE PRICE

PURCHASE AND REDEMPTION OF SHARES

For instructions on how to purchase and redeem shares, read the prospectus
of your insurance company separate account.

WHEN SHARE PRICE IS DETERMINED

The price of VP Income & Growth shares is also referred to as their net
asset value. Net asset value is determined by calculating the total value of the
fund's assets, deducting total liabilities and dividing the result by the number
of shares outstanding. Net asset value is determined at the close of regular
trading on each day that the New York Stock Exchange is open. Investments and
requests to redeem shares received by the separate account before the close of
business of the Exchange, usually 3 p.m. Central time, are effective, and will
receive the price determined, that day as of the close of the Exchange.
Investment, redemption and exchange requests received thereafter are effective
on, and receive the price determined as of the close of the Exchange on, the
next day the Exchange is open.

HOW SHARE PRICE IS DETERMINED

The valuation of assets for determining net asset value may be summarized as
follows:

10 ADDITIONAL INFORMATION YOU SHOULD KNOW AMERICAN CENTURY INVESTMENTS

calculation and the value of the fund's portfolio may be affected on days when
shares of the fund may not be purchased or redeemed.

DISTRIBUTIONS

TAXES

MANAGEMENT

INVESTMENT MANAGEMENT

The portfolio manager members of the VP Income & Growth team and their work
experience for the last five years are as follows:

JOHN SCHNIEDWIND, Senior Vice President and Group Head--Quantitative Equity,
joined American Century in 1982.

KURT BORGWARDT, Vice President, Portfolio Manager and Director of
Quantitative Equity Research, joined American Century in 1990 and has served as
the Director of Quantitative Equity Research since then.

The activities of the manager are subject only to directions of the fund's
Board of Directors. The manager pays all the expenses of the fund except
brokerage, taxes, interest, fees, expenses of the non-interested person
directors (including counsel fees) and extraordinary expenses.

For the services provided to the fund, the manager receives an annual fee of
.70% of the average net assets of the fund. On the first business day of each
month, the fund pays a management fee to the manager for the previous month at
the rate specified. The fee for the previous month is calculated by multiplying
the applicable fee for the fund by the aggregate average daily closing value of
the fund's net assets during the previous month, and further multiplying that
product by a fraction, the numerator of which is the number of days in the
previous month and the denominator of which is 365 (366 in leap years).

INVESTMENT PERFORMANCE OF SIMILAR FUND

The fund commenced operations on September 15, 1997, and therefore has only
a short period of performance history. The fund is substantially identical to
another fund in the American Century family of funds, American Century Income &
Growth. It has the same management team and investment policies. The fees and
expenses are expected to be similar, and it will be managed with the same
investment objective and strategies. However, additional expenses regarding the
insurance product may be applicable. Please consult the separate account
prospectus. The Average Annual Total Return information for American Century
Income & Growth set forth below is not the performance history of the fund, and
is not an indication of future performance of the fund.

PROSPECTUS ADDITIONAL INFORMATION YOU SHOULD KNOW 11

AVERAGE ANNUAL TOTAL RETURNS
For periods ended December 31, 1997
- ----------------------------------------------------------------------------
ONE THREE FIVE LIFE
YEAR YEARS YEARS OF FUND*
- ----------------------------------------------------------------------------
American Century
Income &
Growth Fund 34.52% 31.67% 20.39% 21.07%
- ----------------------------------------------------------------------------

*American Century Income & Growth Fund commenced operations on December 17,
1990.

CODE OF ETHICS

TRANSFER AND ADMINISTRATIVE SERVICES

American Century Services Corporation, American Century Tower, 4500 Main
Street, Kansas City, Missouri 64111 acts as transfer agent and dividend-paying
agent for the fund. It provides facilities, equipment and personnel to the fund
and is paid for such services by the manager. Certain administrative and
recordkeeping services that would otherwise be performed by the transfer agent
may be performed by the insurance company that purchases the fund's shares, and
the manager may pay the insurance company for such services.

The manager and the transfer agent are both wholly owned by American Century
Companies, Inc. James E. Stowers Jr., chairman of the fund's Board of Directors,
controls American Century Companies, Inc. by virtue of his voting control of a
majority of its common stock.

DISTRIBUTION OF FUND SHARES

FURTHER INFORMATION ABOUT AMERICAN CENTURY

12 ADDITIONAL INFORMATION YOU SHOULD KNOW AMERICAN CENTURY INVESTMENTS

PROSPECTUS ADDITIONAL INFORMATION YOU SHOULD KNOW 13

P.O. BOX 419385
KANSAS CITY, MISSOURI
64141-6385

INSTITUTIONAL SERVICES:
1-800-345-3533 OR 816-531-5575

TELECOMMUNICATIONS DEVICE FOR THE DEAF:
1-800-345-1833 OR 816-444-3038

FAX: 816-340-4360

WWW.AMERICANCENTURY.COM

[american century logo(reg.sm)]
American
Century(reg.tm)

9804 [recycled logo]
SH-BKT-11938 Recycled
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION

[american century logo(reg.sm)]
American
Century(reg.tm)

MAY 1, 1998

AMERICAN CENTURY
VARIABLE
PORTFOLIOS, INC.

VP Capital Appreciation
VP Value
VP Balanced
VP Advantage
VP International

STATEMENT OF ADDITIONAL INFORMATION
MAY 1, 1998

AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.

This statement is not a prospectus but should be read in conjunction with the
current Prospectus of American Century Variable Portfolios, Inc. and five of its
series of shares, VP Capital Appreciation, VP Value, VP Balanced, VP Advantage
or VP International as the case may be. Each of such prospectuses is dated May
1, 1998. Please retain this document for future reference. To obtain copies of
the various American Century Variable Portfolios prospectuses, call American
Century at 1-800-345-3533 or 816-531-5575, or write to P.O. Box 419385, Kansas
City, Missouri 64141-6385.

TABLE OF CONTENTS

Selection of Investments .................................................. 2
Additional Investment Restrictions ........................................ 3
Futures Contracts ......................................................... 4
An Explanation of Fixed Income Securities Ratings ......................... 5
Short Sales ............................................................... 7
Portfolio Lending ......................................................... 7
Portfolio Turnover ........................................................ 7
Performance Advertising ................................................... 8
Officers and Directors .................................................... 8
Management ................................................................ 10
Custodian ................................................................. 11
Independent Auditors ...................................................... 11
Capital Stock ............................................................. 11
Brokerage ................................................................. 12
Redemptions in Kind ....................................................... 13
Holidays .................................................................. 13
Financial Statements ...................................................... 13

STATEMENT OF ADDITIONAL INFORMATION 1

SELECTION OF INVESTMENTS

Currently, American Century Variable Portfolios offers six funds. This
Statement of Additional Information applies to five of the funds: VP Capital
Appreciation, VP Value, VP Balanced, VP Advantage and VP International. Such
funds are sometimes individually referred to as a "fund," and collectively as
the "funds."

In achieving their investment objectives, the funds must conform to certain
fundamental policies that may not be changed without shareholder approval. The
following paragraph is a statement of fundamental policy with respect to
investment selection:

In general, within the restrictions outlined in the Prospectus or in other
statements of the corporation's fundamental policies, VP Capital Appreciation,
VP Value, VP International and, with regard to the equity portion of their
portfolios, VP Balanced and VP Advantage, each has broad power with respect to
investing funds or holding them uninvested. Investments are varied according to
what is judged advantageous under changing economic conditions. It is the
manager's intention that VP Capital Appreciation, VP Value, VP International and
the equity portion of VP Balanced and VP Advantage will generally consist of
common stocks. However, the manager may invest the assets in varying amounts in
other instruments and in senior securities, such as bonds, debentures and
preferred stocks, when such a course is deemed appropriate under certain market
and economic conditions. Senior securities that, in the opinion of the manager,
are high-grade issues may also be purchased for defensive purposes.

VP CAPITAL APPRECIATION

The manager intends to invest the assets of VP Capital Appreciation
primarily in common stocks that are considered by management to have
better-than-average prospects for appreciation. The selection of these
investments is described under "Selection of Investments."

VP VALUE

The manager intends to invest the assets of VP Value primarily in equity
securities of well-established companies with intermediate-to-large market
capitalizations that management believes to be undervalued at the time of
purchase. The selection of these investments is described under "Selection of
Investments."

VP BALANCED

The manager intends to invest approximately 60% of the VP Balanced portfolio
in common stocks and the remainder in fixed income securities. Equity security
investments are described under "Selection of Investments." At least 80% of the
fixed income assets will be invested in securities that, at the time of
purchase, are rated by a nationally recognized statistical rating organization
within the three highest categories. The fund may invest in securities of the
U.S. government and its agencies and instrumentalities, corporate, sovereign
government, municipal, mortgage-related, and other asset-backed securities. It
can be expected that the manager will invest from time to time in bonds and
preferred stock convertible into common stock.

VP ADVANTAGE

The manager intends to invest approximately (i) 20% of VP Advantage's assets
in government securities with a weighted average maturity of six months or less,
i.e., cash and cash equivalents, (ii) 40% of the fund's assets in fixed income
government securities with a weighted average maturity of three to 10 years
(although management has the discretion to invest some or all of this portion of
the fund's assets in cash or cash equivalents if it believes that market
conditions merit) and (iii) 40% of the fund's assets in equity securities. All
of the debt securities purchased, regardless of weighted average maturity, will
be securities of the U.S. government and its agencies and instrumentalities,
including mortgage-related and other asset-backed securities issued by such
entities. Equity security investments are described under "Selection of
Investments."

VP INTERNATIONAL

The manager intends to invest the assets of VP International primarily in an
internationally diversified portfolio of common stocks. The selection of these
investments is described under "Selection of Investments."

2 American Century Investments

AMERICAN CENTURY INVESTMENTS

ADDITIONAL INVESTMENT RESTRICTIONS

Additional fundamental policies applicable to American Century Variable
Portfolios that may be changed only with shareholder approval provide that:

(1) No series of shares shall invest more than 15% of its assets in illiquid
investments;

(2) No series of shares shall invest in the securities of companies that,
including predecessors, have a record of less than three years'
continuous operation;

(3) No series of shares shall make loans to other persons, but may lend its
portfolio securities to unaffiliated persons. Such loans must be secured
continuously by cash collateral maintained on a current basis in an
amount at least equal to the market value of the securities loaned;
during the existence of the loan, the corporation must continue to
receive the equivalent of the interest and dividends paid by the issuer
on the securities loaned and interest on the investment of the
collateral; the corporation must have the right to call the loan and
obtain the securities loaned at any time on five days' notice, including
the right to call the loan to enable the corporation to vote the
securities. The interest and dividends on loaned securities of either
series may not exceed 10% of the annual gross income of that series
(without offset for realized capital gains);

(4) Except with regard to VP Value to which this restriction shall apply with
regard to 75% of its portfolio, no series of shares shall purchase the
security of any one issuer if such purchase would cause more than 5% of
the assets of such series at market value to be invested in the
securities of such issuer, except U.S. government securities, or if the
purchase would cause more than 10% of the outstanding voting securities
of any one issuer to be held in the portfolio of such series;

(5) No series of shares shall invest for control or for management, or
concentrate its investment in a particular company or a particular
industry. No more than 25% of the assets of each series, exclusive of
cash and government securities, will be invested in securities of any one
industry. The corporation may make its own reasonable industry
classifications based on information derived from published manuals,
financial database services, and the corporation's analysis of the
financial statements of affected companies;

(6) No series of shares shall buy securities on margin or sell short unless
it owns, or by virtue of its ownership of other securities has the right
to obtain securities equivalent in kind and amount to, the securities
sold (however, VP Value may make margin deposits in connection with the
use of any financial instrument or any transaction in securities
permitted by its fundamental policies), or, except with regard to VP
Value, write put or call options;

(7) No series of shares shall purchase shares of another investment company
if immediately after the purchase (a) the corporation owns more than 3%
of the total outstanding stock of the other investment company, or (b)
the securities that the corporation owns of the other investment company
exceed 5% of the total assets of the corporation, or (c) the securities
that the corporation owns of all other investment companies exceed 10% of
the value of the total assets of the corporation;

(8) No series of shares shall issue any senior security;

(9) No series of shares shall underwrite any security;

(10) No series of shares shall purchase or sell real estate or real estate
mortgage loans but may invest in securities of issuers that deal in real
estate or real estate mortgage loans;

(11) Except with regard to VP Value, no series of shares shall purchase or
sell commodities or commodity contracts, including futures contracts; and

(12) No series of shares shall borrow any money with respect to any series of
its stock, except in an amount not in excess of 5% of the total assets of
the series, and then only for emergency and extraordinary purposes,
including payment for shares redeemed.

The Investment Company Act imposes certain additional restrictions upon
acquisition by the corporation of securities issued by insurance companies,
broker-dealers, underwriters or investment advisors, and upon transactions with
affiliated persons as therein defined. It also defines and forbids the creation
of cross and circular ownership.

STATEMENT OF ADDITIONAL INFORMATION 3

The Investment Company Act also provides that the funds may not invest more
than 25% of their assets in the securities of issuers engaged in a single
industry. In determining industry groups for purposes of this standard, the
Securities and Exchange Commission (SEC) ordinarily uses the Standard Industry
Classification codes developed by the United States Office of Management and
Budget. In the interest of ensuring adequate diversification, the funds monitor
industry concentration using a more restrictive list of industry groups than
that recommended by the SEC. The funds believe that these classifications are
reasonable and are not so broad that the primary economic characteristics of the
companies in a single class are materially different. The use of these more
restrictive industry classifications may, however, cause the funds to forego
investment possibilities which may otherwise be available to them under the
Investment Company Act.

Neither the SEC nor any other agency of the federal or state government
participates in or supervises the funds' management or their investment
practices or policies.

FUTURES CONTRACTS

As described in the Prospectus, VP Value may enter into futures contracts.
Unlike when a fund purchases securities, no purchase price for the underlying
securities is paid by the fund at the time it purchases a futures contract. When
a futures contract is entered, both the buyer and seller of the contract are
required to deposit with a futures commission merchant (FCM) cash or high-grade
debt securities in an amount equal to a percentage of the contract's value, as
set by the exchange on which the contract is traded. This amount is known as
"initial margin" and is held by the fund's custodian for the benefit of the FCM
in the event of any default by the fund in the payment of any future
obligations.

The value of the futures contract is adjusted daily to reflect the
fluctuation of the value of the underlying securities. This is a process known
as marking the contract to market. If the value of a party's position declines,
that party is required to make additional "variation margin" payments to the FCM
to settle the change in value. The party that has a gain is generally entitled
to receive all or a portion of this amount.

The fund maintains from time to time a percentage of its assets in cash or
high-grade liquid securities to provide for redemptions or to hold for future
investment in securities consistent with the fund's investment objectives. The
fund may enter into index futures contracts as an efficient means to expose the
fund's cash position to the domestic equity market. The manager believes that
the purchase of futures contracts is an efficient means to effectively be fully
invested in equity securities.

The fund intends to comply with guidelines of eligibility for exclusion from
the definition of the term "commodity pool operator" adopted by the Commodity
Futures Trading Commission (CFTC) and the National Futures Association, which
regulate trading in the futures markets. To do so, the aggregate initial margin
required to establish such positions may not exceed 5% of the fair market value
of the fund's net assets, after taking into account unrealized profits and
unrealized losses on any contracts it has entered into.

The principal risks generally associated with the use of futures include:

o the possible absence of a liquid secondary market for any particular
instrument may make it difficult or impossible to close out a position
when desired (liquidity risk);

o the risk that the counter party to the contract may fail to perform its
obligations or the risk of bankruptcy of the FCM holding margin deposits
(counter-party risk);

o the risk that the securities to which the futures contract relates may go
down in value (market risk); and

o adverse price movements in the underlying securities can result in losses
substantially greater than the value of the fund's investment in that
instrument because only a fraction of a contract's value is required to
be deposited as initial margin (leverage risk); provided, however, that
the fund may not purchase leveraged futures, so there is no leverage risk
involved in the fund's use of futures.

A liquid secondary market is necessary to close out a contract. The fund may
seek to manage liquidity risk by investing only in exchange-traded futures.
Exchange-traded futures pose less risk that there will not be a liquid secondary
market than privately negotiated instruments. Through their clearing corpora-

4 AMERICAN CENTURY INVESTMENTS

tions, the futures exchanges guarantee the performance of the contracts.

Futures contracts are generally settled within a day from the date they are
closed out, as compared to three days for most types of equity securities. As a
result, futures contracts can provide more liquidity than an investment in the
actual underlying securities. Nevertheless, there is no assurance that a liquid
secondary market will exist for any particular futures contract at any
particular time. Liquidity may also be influenced by an exchange-imposed daily
price fluctuation limit, which halts trading if a contract's price moves up or
down more than the established limit on any given day. On volatile trading days
when the price fluctuation limit is reached, it may be impossible for a fund to
enter into new positions or close out existing positions. If the secondary
market for a futures contract is not liquid because of price fluctuation limits
or otherwise, the fund may not be able to promptly liquidate unfavorable futures
positions and potentially could be required to continue to hold a futures
position until liquidity in the market is re-established. As a result, the
fund's access to other assets held to cover its futures positions also could be
impaired until liquidity in the market is re-established.

The fund manages counter-party risk by investing in exchange-traded index
futures. In the event of the bankruptcy of the FCM that holds margin on behalf
of the fund, the fund may be entitled to the return of margin owed to the fund
only in proportion to the amount received by the FCM's other customers. The
manager will attempt to minimize the risk by monitoring the creditworthiness of
the FCMs with which the fund does business.

The prices of futures contracts depend primarily on the value of their
underlying instruments. As a result, the movement in the market price of index
futures contracts will reflect the movement in the the aggregate market price of
the entire portfolio of securities comprising the index. Since VP Value is not
an index fund, its investment in futures contracts will not correlate precisely
with the performance of the fund's other equity investments. However, the
manager believes that an investment in index futures will more closely reflect
the investment performance of the fund than an investment in U.S. government or
other highly liquid, short-term debt securities, which is where the cash
position of the fund would otherwise be invested.

The policy of the manager is to remain fully invested in equity securities.
There may be times when the manager deems it advantageous to the fund not to
invest excess cash in index futures, but such decisions will generally not be
the result of an active effort to use futures to time or anticipate market
movements in general.

AN EXPLANATION OF FIXED INCOME SECURITIES RATINGS

As described in the Prospectus, the funds may invest in fixed income
securities. Fixed income securities ratings provide the manager with current
assessment of the credit rating of an issuer with respect to a specific fixed
income security. The following is a description of the rating categories
utilized by the rating services referenced in the Prospectus disclosure:

The following summarizes the ratings used by Standard & Poor's Corporation
(S&P) for bonds:

AAA--This is the highest rating assigned by S&P to a debt obligation and
indicates an extremely strong capacity to pay interest and repay principal.

AA--Debt rated AA is considered to have a very strong capacity to pay
interest and repay principal and differs from AAA issues only to a small
degree.

A--Debt rated A has a strong capacity to pay interest and repay principal,
although it is somewhat more susceptible to the adverse effects of changes in
circumstances and economic conditions than debt in higher-rated categories.

BBB--Debt rated BBB is regarded as having an adequate capacity to pay
interest and repay principal. Whereas it normally exhibits adequate
protection parameters, adverse economic conditions or changing circumstances
are more likely to lead to a weakened capacity to pay interest and repay
principal for debt in this category than in higher-rated categories.

BB--Debt rated BB has less near-term vulnerability to default than other
speculative issues. 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 payments. The BB
rating category is also used for debt subordinated to senior debt that is
assigned an actual or implied BBB- rating.

STATEMENT OF ADDITIONAL INFORMATION 5

B--Debt rated B has a greater vulnerability to default but currently has the
capacity to meet interest payments and principal repayments. Adverse
business, financial or economic conditions will likely impair capacity or
willingness to pay interest and repay principal. The B rating category is
also used for debt subordinated to senior debt that is assigned an actual or
implied BB or BB- rating.

CCC--Debt rated CCC has a currently identifiable vulnerability to default and
is dependent upon favorable business, financial and economic conditions to
meet timely payment 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. The CCC rating category is
also used for debt subordinated to senior debt that is assigned an actual or
implied B or B- rating.

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

C--The rating C typically is applied to debt subordinated to senior debt that
is assigned an actual or implied CCC- debt rating. The C rating may be used
to cover a situation where a bankruptcy petition has been filed, but debt
service payments are continued.

CI--The rating CI is reserved for income bonds on which no interest is being
paid.

D--Debt rated D is in payment default. The D rating category is used when
interest payments or principal payments are not made on the date due even if
the applicable grace period has not expired, unless S&P believes that such
payments will be made during such grace period. The D rating also will be
used upon the filing of a bankruptcy petition if debt service payments are
jeopardized.

To provide more detailed indications of credit quality, the ratings from AA
to CCC may be modified by the addition of a plus or minus sign to show relative
standing within these major rating categories.

The following summarizes the ratings used by Moody's Investors Service, Inc.
(Moody's) for bonds:

AAA--Bonds that 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 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 that are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what are generally 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 that make the long-term risk appear somewhat larger than the
Aaa securities.

A--Bonds that 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 that suggest a susceptibility to impairment some time in the
future.

BAA--Bonds that are rated Baa are considered 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 that 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 thereby not well safeguarded
during both good and bad times in the future. Uncertainty of position
characterizes bonds in this class.

B--Bonds that are rated B generally lack characteristics of a 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 that 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 that are rated Ca represent obligations that are speculative in a
high degree. Such issues are often in default or have other marked
shortcomings.

6 AMERICAN CENTURY INVESTMENTS

C--Bonds that 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.

Moody's applies numerical modifiers 1, 2 and 3 in each generic rating
category from Aa through B. The modifier 1 indicates that the bond being rated
ranks in the higher end of its generic rating category; the modifier 2 indicates
a mid-range ranking; and the modifier 3 indicates a ranking in the lower end of
that generic rating category.

SHORT SALES

A fund may engage in short sales if, at the time of the short sale, the fund
owns or has the right to acquire an equal amount of the security being sold
short at no additional cost.

In a short sale, the seller does not immediately deliver the securities sold
and is said to have a short position in those securities until delivery occurs.
To make delivery to the purchaser, the executing broker borrows the securities
being sold short on behalf of the seller. While the short position is
maintained, the seller collateralizes its obligation to deliver the securities
sold short in an amount equal to the proceeds of the short sale plus an
additional margin amount established by the Board of Governors of the Federal
Reserve. If a fund engages in a short sale, the collateral account will be
maintained by the fund's custodian. There will be certain additional transaction
costs associated with short sales, but the fund will endeavor to offset these
costs with income from the investment of the cash proceeds of short sales.

A fund may make a short sale, as described above, when it wants to sell the
security it owns at a current attractive price, but also wishes to defer
recognition of a gain or loss for federal income tax purposes and for purposes
of satisfying certain tests applicable to regulated investment companies under
the Internal Revenue Code. In such a case, any future losses in the fund's long
position in substantially identical securities may not become deductible for tax
purposes until all or some part of the short position has been closed.

PORTFOLIO LENDING

In order to realize additional income, a fund may lend its portfolio
securities. Such loans may not exceed one-third of the fund's net assets valued
at market except (i) through the purchase of debt securities in accordance with
its investment objective, policies and limitations, or (ii) by engaging in
repurchase agreements with respect to portfolio securities.

PORTFOLIO TURNOVER

The portfolio turnover rates of the funds are shown in the Financial
Highlights table in the prospectuses.

With respect to each fund, the manager will purchase and sell securities
without regard to the length of time the security has been held. Accordingly,
the fund's rate of portfolio turnover may be substantial.

The funds intend to purchase a given security whenever the manager believes
it will contribute to the stated objective of the fund. In order to achieve each
fund's investment objective, the manager will sell a given security, no matter
for how long or for how short a period it has been held in the portfolio, and no
matter whether the sale is at a gain or at a loss, if the manager believes that
the security is not fulfilling its purpose, either because, among other things,
it did not live up to the manager's expectations, or because it may be replaced
with another security holding greater promise, or because it has reached its
optimum potential, or because of a change in the circumstances of a particular
company or industry or in general economic conditions, or because of some
combination of such reasons.

When a general decline in security prices is anticipated, the equity funds
may decrease or eliminate entirely their equity positions and increase their
cash positions, and when a rise in price levels is anticipated, the equity funds
may increase their equity positions and decrease their cash positions. However,
it should be expected that the funds will, under most circumstances, be
essentially fully invested in equity securities.

Since investment decisions are based on the anticipated contribution of the
security in question to the fund's objectives, the manager believes that the
rate of portfolio turnover is irrelevant when it believes a change is in order
to achieve those objectives, and the fund's annual portfolio turnover rate
cannot be anticipated and may be comparatively high. This disclosure regarding
portfolio turnover is a statement of fundamental policy and may be changed only
by a vote of the shareholders.

STATEMENT OF ADDITIONAL INFORMATION 7

Since the manager does not take portfolio turnover rate into account in
making investment decisions, (1) the manager has no intention of accomplishing
any particular rate of portfolio turnover, whether high or low, and (2) the
portfolio turnover rates in the past should not be considered as a
representation of the rates that will be attained in the future.

PERFORMANCE ADVERTISING

The following table sets forth the average annual total return of each of
the funds for the periods indicated. Average annual total return is calculated
by determining a fund's cumulative total return for the stated period and then
computing the annual compound return that would produce the cumulative total
return if the fund's performance had been constant over that period. Cumulative
total return includes all elements of return, including reinvestment of
dividends and capital gains distributions.

From
FUND 1 Year 5 Year Inception
- ----------------------------------------------------------------------

VP CAPITAL APPRECIATION (3.26)% 5.76% 9.34%(1)
VP BALANCED 15.81% 11.27% 11.05%(2)
VP ADVANTAGE 12.83% 9.21% 8.63%(3)
VP INTERNATIONAL 18.63% -- 10.60%(4)
VP VALUE 26.08% -- 23.16%(5)
- ----------------------------------------------------------------------
(1) Inception date was 11/20/87.
(2) Inception date was 5/1/91.
(3) Inception date was 8/1/91.
(4) Inception date was 5/1/94.
(5) Inception date was 5/1/96.

The funds may advertise average annual total returns over periods of time
other than those periods shown in the foregoing table. The funds also may
advertise cumulative total return over various time periods.

The following table shows the cumulative total return and the average annual
compound rate of return of the funds for the period indicated.

Cumulative Average Annual
Total Return Compound Rate
FUND Since Inception Since Inception
- -------------------------------------------------------------
VP CAPITAL APPRECIATION 146.60% 9.34%
VP BALANCED 101.14% 11.05%
VP ADVANTAGE 70.14% 8.63%
VP INTERNATIONAL 44.68% 10.60%
VP VALUE 41.57% 23.16%
- ----------------------------------------------------------

PERFORMANCE FIGURES ADVERTISED BY AMERICAN CENTURY VARIABLE PORTFOLIOS
SHOULD NOT BE USED FOR COMPARATIVE PURPOSES BECAUSE SUCH FIGURES WILL NOT
INCLUDE CHARGES AND DEDUCTIONS IMPOSED BY THE INSURANCE COMPANY SEPARATE ACCOUNT
UNDER THE VARIABLE ANNUITY OR VARIABLE LIFE INSURANCE CONTRACTS.

OFFICERS AND DIRECTORS

The principal officers and the directors of American Century Variable
Portfolios, Inc. (the Corporation), their ages (listed in parentheses), their
principal business experience during the past five years, and their affiliations
with the funds' investment manager, American Century Investment Management, Inc.
and its transfer agent, American Century Services Corporation are listed below.
The address at which each director and officer listed below may be contacted is
American Century Tower, 4500 Main Street, Kansas City, Missouri 64111. All
persons named as officers of the Corporation also serve in similar capacities
for other funds advised by the manager. Those directors who are "interested
persons" as defined in the Investment Company Act of 1940 are indicated by an
asterisk (*).

JAMES E. STOWERS JR.* (74), Chairman of the Board and Director; Chairman of
the Board, Director and controlling shareholder of American Century Companies,
Inc., parent corporation of American Century Investment Management, Inc. and
American Century Services Corporation; Chairman of the Board and Director of
American Century Investment Management, Inc. and American Century Services
Corporation; father of James E. Stowers III.

JAMES E. STOWERS III* (39), Director; Chief Executive Officer and Director,
American Century Companies, Inc., American Century Investment Management, Inc.
and American Century Services Corporation.

THOMAS A. BROWN (58), Director; Director of Plains States Development,
Applied Industrial Technologies, Inc., a corporation engaged in the sale of
bearings and power transmission products.

ROBERT W. DOERING, M.D. (64), Director; retired, formerly general surgeon.

ANDREA C. HALL, PH.D. (53), Director; Senior Vice President and Associate
Director, Midwest Research Institute.

8 AMERICAN CENTURY INVESTMENTS

D.D. (DEL) HOCK (63), Director; retired, formerly Chairman, Public Service
Company of Colorado; Director, Service Tech, Inc., Hathaway Corporation, and J.
D. Edwards & Company.

DONALD H. PRATT (60), Vice Chairman of the Board and Director; President and
Director, Butler Manufacturing Company.

LLOYD T. SILVER JR. (70), Director; President, LSC, Inc., manufacturer's
representative.

M. JEANNINE STRANDJORD (52), Director; Senior Vice President and Treasurer,
Sprint Corporation; Director, DST Systems, Inc.

RICHARD W. INGRAM (42), President; Executive Vice President and Director of
Client Services and Treasury Administration, Funds Distributor, Inc. (FDI). Mr.
Ingram joined FDI in 1995. Prior to joining FDI, Mr. Ingram served as Vice
President and Division Manager of First Data Investor Services Group, Inc. (from
March 1994 to November 1995) and before that as Vice President, Assistant
Treasurer and Tax Director-Mutual Funds of The Boston Company, Inc. (from 1989
to 1994).

MARYANNE ROEPKE, CPA (42), Vice President, Treasurer, and Principal
Accounting Officer; Senior Vice President, American Century Services
Corporation.

PATRICK A. LOOBY (39), Vice President; Vice President, American Century
Services Corporation.

CHRISTOPHER J. KELLEY (33), Vice President; Vice President and Associate
General Counsel of FDI. Prior to joining FDI, Mr. Kelley served as Assistant
Counsel at Forum Financial Group (from April 1994 to July 1996) and before that
as a compliance officer for Putnam Investments (from 1992 to 1994).

MARY A. NELSON (34), Vice President; Vice President and Manager of Treasury
Services and Administration of FDI. Prior to joining FDI, Ms. Nelson was
Assistant Vice President and Client Manager for The Boston Company, Inc. (from
1989 to 1994).

MERELE A. MAY (35), Controller; Vice President, American Century Services
Corporation.

ROBERT J. LEACH, CPA (31), Controller.

C. JEAN WADE, CPA (34), Controller.

JON ZINDEL, CPA (31), Tax Officer; Vice President and Director of Taxation,
American Century Services Corporation (1996); Tax Manager, Price Waterhouse
(from 1989-1996).

The Board of Directors has established four standing committees, the
Executive Committee, the Audit Committee, the Compliance Committee and the
Nominating Committee.

Messrs. Stowers Jr. (chair), Stowers III, and Pratt constitute the Executive
Committee of the Board of Directors. The committee performs the functions of the
Board of Directors between meetings of the Board, subject to the limitations on
its power set out in the Maryland General Corporation Law, and except for
matters required by the Investment Company Act to be acted upon by the full
Board.

Ms. Strandjord (chair), Dr. Doering and Mr. Hock constitute the Audit
Committee. The functions of the Audit Committee include recommending the
engagement of the funds' independent accountants, reviewing the arrangements for
and scope of the annual audit, reviewing comments made by the independent
accountants with respect to the internal controls and the considerations given
or the connective action taken by management, and reviewing nonaudit services
provided by the independent accountants.

Messrs. Brown (chair), Pratt, Silver and Dr. Hall constitute the Compliance
Committee. The functions of the Compliance Committee include reviewing the
results of the funds' compliance testing program, reviewing quarterly reports
from the manager to the Board regarding various compliance matters and
monitoring the implementation of the funds' Code of Ethics, including violations
thereof.

The Nominating Committee has as its principal role consideration and
recommendation of individuals for nomination as directors. The names of
potential director candidates are drawn from a number of sources, including
recommendations from members of the Board, management and shareholders. This
committee also reviews and makes recommendations to the Board with respect to
the composition of Board committees and other Board-related matters, including
its organization, size, composition, responsibilities, functions and
compensation. The members of the nominating committee are Messrs. Pratt (chair),
Hock and Stowers III.

The Directors of the corporation also serve as Directors for other funds
advised by the manager. Each Director who is not an "interested person" as
defined in the Investment Company Act receives for service as a member of the
Board of all six of such

STATEMENT OF ADDITIONAL INFORMATION 9

companies an annual director's fee of $44,000, a fee of $1,000 per regular Board
meeting attended and $500 per special Board meeting and committee meeting
attended. In addition, those directors who are not "interested persons" who
serve as the chair of a committee of the Board of Directors receive an
additional $2,000 for such services. These fees and expenses are divided among
the six investment companies based upon their relative net assets. Under the
terms of the management agreement with the manager, the funds are responsible
for paying such fees and expenses. Set forth in the following table is the
aggregate compensation paid for the periods indicated by the funds and by the
American Century family of funds as a whole to each director of the corporation
who is not an "interested person" as defined in the Investment Company Act.

Aggregate Total Compensation from
Compensation the American Century
Director from the Corporation(1) Family of Funds(2)
- --------------------------------------------------------------------------------

Thomas A. Brown $1,596 $60,000

Robert W. Doering, M.D. 1,317 49,500

Andrea C. Hall(3) 235 8,833

D. D. (Del) Hock 1,317 49,500

Linsley L. Lundgaard 1,126 42,333

Donald H. Pratt 1,596 60,000

Lloyd T. Silver Jr. 1,303 49,000

M. Jeannine Strandjord 1,299 48,833
- --------------------------------------------------------------------------------

(1)Includes compensation paid by the corporation during the fiscal year ended
December 31, 1997.

(2)Includes compensation paid by the 13 investment company members of the
American Century family of funds for the calendar year ended December 31, 1997.

(3)Andrea C. Hall replaced Linsley L. Lundgarrd as an independent director
effective November 1, 1997.

MANAGEMENT

A description of the responsibilities and method of compensation of the
funds' manager, American Century Investment Management, Inc. appears in the
Prospectus under the caption "Management."

During the past three fiscal years, the management fees were as follows:

FUND Years Ended December 31,
- --------------------------------------------------------------------------------
1997 1996 1995
- --------------------------------------------------------------------------------

VP CAPITAL APPRECIATION
Management Fees $ 10,378,643 $ 14,401,981 $ 12,365,098
Average Net Assets 1,041,484,038 1,444,414,188 1,245,866,500

VP BALANCED
Management Fees 2,346,313 1,832,133 1,222,757
Average Net Assets 234,698,258 185,726,034 126,219,800

VP ADVANTAGE
Management Fees 249,359 238,392 218,240
Average Net Assets 25,348,464 38,676,300 22,425,700

VP INTERNATIONAL
Management Fees 2,659,954 1,170,843 596,598
Average Net Assets 177,484,663 78,092,615 39,770,213

VP VALUE
Management Fees 985,657 62,187 -
Average Net Assets 98,518,788 9,241,069 -
- --------------------------------------------------------------------------------

The management agreement shall continue in effect until the earlier of the
expiration of two years from the date of its execution or until the first
meeting of shareholders following such execution and for as long thereafter as
its continuance is specifically approved at least annually by (i) the funds'
Board of Directors, or by the vote of a majority of the outstanding votes (as
defined in the Investment Company Act), and (ii) by the vote of a majority of
the Directors of the funds who are not parties to the agreement or interested
persons of the manager, cast in person at a meeting called for the purpose of
voting on such approval.

The management agreement provides that it may be terminated at any time
without payment of any penalty by the funds' Board of Directors, or by a vote of
a majority of the funds' shareholders, on 60 days' written notice to the
manager, and it shall be automatically terminated if it is assigned.

The management agreement provides that the manager shall not be liable to
the funds or their shareholders for anything other than willful misfeasance, bad
faith, gross negligence or reckless disregard of its obligations or duties.

The management agreement also provides that the manager and its officers,
directors and employees may engage in other business, devote time and attention
to any other business whether of a similar or dissimilar nature, and render
services to others.

Certain investments may be appropriate for the

10 AMERICAN CENTURY INVESTMENTS

funds and also for other clients advised by the manager. Investment decisions
for the funds and other clients are made with a view to achieving their
respective investment objectives after consideration of such factors as their
current holdings, availability of cash for investment, and the size of their
investment generally. A particular security may be bought or sold for only one
client or series, or in different amounts and at different times for more than
one but less than all clients or series. In addition, purchases or sales of the
same security may be made for two or more clients or series on the same date.
Such transactions will be allocated among clients in a manner believed by the
manager to be equitable to each. In some cases this procedure could have an
adverse effect on the price or amount of the securities purchased or sold by a
fund.

The manager may aggregate purchase and sale orders of the funds with
purchase and sale orders of its other clients when the manager believes that
such aggregation provides the best execution for the funds. The funds' Board of
Directors has approved the policy of the manager with respect to the aggregation
of portfolio transactions. Where portfolio transactions have been aggregated,
the funds participate at the average share price for all transactions in that
security on a given day and share transaction costs on a pro rata basis. The
manager will not aggregate portfolio transactions of the funds unless it
believes such aggregation is consistent with its duty to seek best execution on
behalf of the funds and the terms of the management agreement. The manager
receives no additional compensation or remuneration as a result of such
aggregation.

In addition to managing the funds, on February 28, 1998, the manager was
also acting as an investment adviser to 10 institutional accounts and to 12
registered investment companies, American Century Mutual Funds, Inc., American
Century World Mutual Funds, Inc., American Century Premium Reserves, Inc.,
American Century Variable Portfolios, Inc., American Century Capital Portfolios,
Inc., American Century Municipal Trust, American Century Quantitative Equity
Funds, American Century International Bond Funds, American Century Investment
Trust, American Century Government Income Trust, American Century Target
Maturities Trust and American Century California Tax-Free and Municipal Funds.

American Century Services Corporation provides physical facilities,
including computer hardware and software and personnel, for the day-to-day
administration of the funds and of the manager. The manager pays American
Century Services Corporation for such services.

As stated in the Prospectus, all of the stock of American Century Services
Corporation and American Century Investment Management, Inc. is owned by
American Century Companies, Inc.

CUSTODIANS

Chase Manhattan Bank, N.A., 770 Broadway, New York, New York 10036 serves as
custodian of the assets of the funds, except UMB Bank, N.A., 10th and Grand,
Kansas City, Missouri 64105 serves as custodian of VP International. The
custodians take no part in determining the investment policies of the funds or
in deciding which securities are purchased or sold by the funds. The funds,
however, may invest in certain obligations of the custodians and may purchase or
sell certain securities from or to the custodians.

INDEPENDENT AUDITORS

Deloitte & Touche LLP, 1010 Grand Avenue, Kansas City, Missouri 64106, are
the independent auditors of the funds. As the independent auditors of the funds,
Deloitte & Touche will provide services including (1) audit of the annual
financial statements, (2) assistance and consultation in connection with SEC
filings and (3) review of the annual federal income tax return filed for each
fund by American Century.

CAPITAL STOCK

The funds' capital stock is described in the Prospectus under the heading
"Further Information About American Century."

The corporation currently has six series of shares outstanding. The funds
may in the future issue one or more additional series of shares. The assets
belonging to each series of shares are held separately by the custodian and the
shares of each series represent a beneficial interest in the principal, earnings
and profits (or losses) of investments and other assets held for each series.
Your rights as a shareholder are the same for all other series of securities
unless otherwise stated. Within their respective series, all shares have equal

STATEMENT OF ADDITIONAL INFORMATION 11

redemption rights. Each share, when issued, is fully paid and non-assessable.
Each share, irrespective of series, is entitled to one vote for each dollar of
net asset value applicable to such share on all questions.

In the event of complete liquidation or dissolution of the funds,
shareholders of each series of shares shall be entitled to receive, pro rata,
all of the assets less the liabilities of that series.

As of February 28, 1998, in excess of 5% of the outstanding shares of the
following funds were owned of record by:

Name of Fund Shareholder and Percentage
- --------------------------------------------------------------------------------

VP Capital Appreciation Nationwide Life Insurance Company
Columbus, Ohio -- 65.0%

Penn Mutual Life Insurance
Philadelphia, Pennsylvania -- 6.0%

Mutual of America
New York, New York -- 9.1%

Great-West Life and Annuity Company
Englewood, Colorado -- 7.8%

VP Advantage Nationwide Life Insurance Company
Columbus, Ohio -- 98.9%

VP Balanced Nationwide Life Insurance Company
Columbus, Ohio -- 78.2%

Lincoln National Life Insurance Company
Ft. Wayne, Indiana -- 11.0%

VP International Nationwide Life Insurance Company
Columbus, Ohio -- 87.0%

VP Value IDS Life Insurance Company
Minneapolis, Minnesota -- 55.6%

Nationwide Life Insurance Company
Columbus, Ohio -- 38.2%
- --------------------------------------------------------------------------------

All of such shares of the funds are held for the benefit of the holders of
variable life and variable annuity policies issued by such insurance companies.
Such shares are held in one or more accounts by entities controlled by such
insurance companies.

BROKERAGE

Under the terms of the management agreement between the funds and the
manager, the manager has the responsibility of selecting brokers to execute
portfolio transactions. The funds' policy is to secure the most favorable prices
and execution of orders on its portfolio transactions. So long as that policy is
met, the manager may take into consideration the factors indicated below in
selecting brokers or dealers.

Equity Investments: Transactions in securities other than those for which an
exchange is the primary market may be done with dealers acting as principal or
market maker or with brokers. Transactions will be done on a brokerage basis
when the manager believes that the facilities, expert personnel and
technological systems of a broker enable American Century Variable Portfolios to
secure as good a net price as it would have received from a market maker.
American Century Variable Portfolios places most of its over-the-counter
transactions with market makers.

Fixed Income Investments: Purchases are made directly from issuers,
underwriters, broker-dealers or banks. In many transactions, the selection of
the broker-dealer is determined by the availability of the desired security and
its offering price. In other transactions, the selection is a function of the
selection of market and the negotiation of price, as well as the broker-dealer's
general execution, operational and financial capabilities in the type of
transaction involved.

The manager receives statistical and other information and services
(brokerage and research services) without cost from broker-dealers. The manager
evaluates such information and services, together with all other information
that it may have, in supervising and managing the investment portfolios of the
funds. Because such information and services may vary in amount, quality and
reliability, their influence in selecting brokers varies from none to very
substantial. The manager proposes to continue to place some of the brokerage
business with one or more brokers who provide information and services.

The brokerage and research services received by the manager may be used with
respect to one or more of the funds and/or the other funds and accounts over
which it has investment discretion, and not all of such services may be used by
the manager in managing the portfolios of the funds. Such information and
services are in addition to and not in lieu of the services required to be
performed for the funds by the manager. The manager does not utilize brokers
that provide such information and services for the purpose of reducing the
expense of providing required services to the funds.

Evaluation of the overall reasonableness of brokerage commissions is made by
the manager and reviewed by the Board of Directors of American Century Variable
Portfolios. In the years ended December 31, 1997, 1996 and 1995, the paid
brokerage commissions of each fund were as follows:

12 AMERICAN CENTURY INVESTMENTS

FUND Years Ended December 31,
- -------------------------------------------------------------------------
1997 1996 1995
- -------------------------------------------------------------------------

VP CAPITAL APPRECIATION $1,573,432 3,879,230 3,826,468

VP VALUE 466,557 25,821 --

VP BALANCED 294,313 235,149 153,670

VP ADVANTAGE 20,302 19,734 19,477

VP INTERNATIONAL 1,329,778 630,547 525,846
- -------------------------------------------------------------------------

In 1997, $3,525,726 (96%) of the total brokerage commissions ($3,684,887)
were paid to brokers and dealers who provided information and services.

The brokerage commissions paid by the funds may exceed those which another
broker might have charged for effecting the same transactions, because of the
value of the brokerage and research services provided by the broker. Factors
considered in such determinations are skill in execution of orders and the
quality of brokerage and research services received. Research services furnished
by brokers through whom the funds effect securities transactions may be used by
the manager in servicing all of its accounts, and not all such services may be
used by the manager in managing the portfolios of the funds.

The staff of the SEC has expressed the view that the best price and
execution of over-the-counter transactions in portfolio securities may be
secured by dealing directly with principal market makers, thereby avoiding the
payment of compensation to another broker. In certain situations, the officers
of the funds and the manager believe that the facilities, expert personnel and
technological systems of a broker enable the funds to secure as good a net price
by dealing with a broker instead of a principal market maker, even after payment
of the compensation to the broker. The funds normally place their
over-the-counter transactions with principal market makers but also may deal on
a brokerage basis when utilizing electronic trading networks or as circumstances
warrant.

REDEMPTIONS IN KIND

Shares will normally be redeemed for cash, although the corporation retains
the right to redeem its shares in kind under unusual circumstances, such as an
unusually large redemption, in order to protect the investments of the remaining
shareholders.

The corporation has elected to be governed by Rule 18f-1 under the
Investment Company Act of 1940, pursuant to which the funds are obligated to
redeem shares solely in cash up to the lesser of $250,000 or 1% of the net asset
value of a fund during any 90-day period for any one shareholder. Should
redemptions by any one contract owner exceed such limitation, the corporation
will have the option of redeeming the excess in cash or in kind. If shares are
redeemed in kind, the redeeming shareholder might incur brokerage costs in
converting the assets to cash. The securities delivered will be selected at the
sole discretion of the manager, and will not necessarily be representative of
the entire portfolio, and will be securities that the manager regards as least
desirable. The method of valuing portfolio securities used to make redemptions
in kind will be the same as the method of valuing portfolio securities described
in the Prospectus under the caption "How Share Price is Determined," and such
valuation will be made as of the same time the redemption price is determined.

HOLIDAYS

The funds do not determine the net asset value of their shares on days when
the New York Stock Exchange is closed. Currently, the Exchange is closed on
Saturdays and Sundays, and on holidays, namely New Year's Day, Martin Luther
King Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence Day,
Labor Day, Thanksgiving and Christmas.

FINANCIAL STATEMENTS

The financial statements of the funds for the fiscal year ended December 31,
1997 are included in the annual report to shareholders for that period, which is
incorporated herein by reference. You may receive copies of the annual report
without charge upon request to the funds at the address and telephone number
shown on page 1 of this Statement of Additional Information.

STATEMENT OF ADDITIONAL INFORMATION 13

P.O. BOX 419385
KANSAS CITY, MISSOURI
64141-6385

INSTITUTIONAL SERVICES:
1-800-345-3533 OR 816-531-5575

TELECOMMUNICATIONS DEVICE FOR THE DEAF:
1-800-345-1833 OR 816-444-3485

FAX: 816-340-4360

WWW.AMERICANCENTURY.COM

[american century logo(reg.sm)]
American
Century(reg.tm)

9803 [recycled logo]
SH-BKT-11945 Recycled
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION

[american century logo(reg.sm)]
American
Century(reg.tm)

MAY 1, 1998

AMERICAN CENTURY
VARIABLE
PORTFOLIOS, INC.

VP Income & Growth

STATEMENT OF ADDITIONAL INFORMATION
MAY 1, 1998

AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.

This statement is not a prospectus but should be read in conjunction with the
current Prospectus of VP Income & Growth, a series of shares of American Century
Variable Portfolios, Inc. Such prospectus is dated May 1, 1998. Please retain
this document for future reference. To obtain a copy of the VP Income & Growth
prospectus, call American Century at 1-800-345-3533 or 816-531-5575, or write to
P.O. Box 419385, Kansas City, Missouri 64141-6385.

TABLE OF CONTENTS

Investment Restrictions ................................................... 2
U.S. Government Securities ................................................ 2
Repurchase Agreements ..................................................... 3
When-Issued and Forward Commitment Agreements ............................. 3
Convertible Securities .................................................... 3
Foreign Securities ........................................................ 4
Foreign Currency Exchange Transactions .................................... 4
Depositary Receipts ....................................................... 5
Restricted Securities ..................................................... 5
Put Options on Individual Securities ...................................... 5
Futures and Options Transactions .......................................... 6
Portfolio Lending ......................................................... 9
Portfolio Turnover ........................................................ 9
Performance ............................................................... 10
Officers and Directors .................................................... 10
Management ................................................................ 12
Custodian ................................................................. 13
Independent Auditors ...................................................... 13
Capital Stock ............................................................. 13
Brokerage ................................................................. 13
Redemptions in Kind ....................................................... 14
Holidays .................................................................. 15
Financial Statements ...................................................... 15

STATEMENT OF ADDITIONAL INFORMATION 1

INVESTMENT RESTRICTIONS

In achieving its objective, the fund must conform to certain fundamental
policies. These policies, which may not be changed without shareholder approval,
provide that the fund:

(1) Shall not lend any security or make any other loan if, as a result, more
than 33-1/3% of the fund's total assets would be lent to other parties,
except (i) through the purchase of debt securities in accordance with its
investment objective, policies and limitations, or (ii) by engaging in
repurchase agreements with respect to portfolio securities;

(2) Shall not invest for purposes of exercising control over management;

(3) Shall not issue senior securities, except as permitted under the
Investment Company Act of 1940;

(4) Shall not act as an underwriter of securities by others, except to the
extent that the fund may be considered an underwriter within the meaning
of the Securities Act of 1933 in the disposition of restricted securities;

(5) Shall not borrow any money, except that the fund may borrow money for
temporary or emergency purposes (not for leveraging or investment) in an
amount not exceeding 331/3% of the fund's total assets (including the
amount borrowed) less liabilities (other than borrowings);

(6) Shall not purchase or sell physical commodities unless acquired as a
result of ownership of securities or other instruments; provided that this
policy shall not prohibit the fund from purchasing or selling options and
futures contracts or from investing in securities or other instruments
backed by physical commodities;

(7) Shall not purchase or sell real estate unless acquired as a result of
ownership of securities or other instruments. This policy shall not
prevent the fund from investment in securities or other instruments backed
by real estate or securities of companies that deal in real estate or are
engaged in the real estate business; and

(8) Shall not concentrate its investments in securities of issues in a
particular industry (other than securities issued or guaranteed by the
U.S. government or any of its agencies or instrumentalities).

The Investment Company Act also provides that a diversified fund may not
invest more than 25% of its assets in the securities of issuers engaged in a
single industry. In determining industry groups for purposes of this standard,
the Securities and Exchange Commission (SEC) ordinarily uses the Standard
Industry Classification codes developed by the United States Office of
Management and Budget. In the interest of ensuring adequate diversification, the
fund monitors industry concentration using a more restrictive list of industry
groups than that recommended by the SEC. The fund believes that these
classifications are reasonable and are not so broad that the primary economic
characteristics of the companies in a single class are materially different. The
use of these more restrictive industry classifications may, however, cause the
fund to forego investment possibilities which may otherwise be available to it
under the Investment Company Act.

Neither the SEC nor any other agency of the federal or state government
participates in or supervises the fund's management or its investment practices
or policies.

U.S. GOVERNMENT SECURITIES

The fund may invest in U.S. government securities, including bills, notes
and bonds issued by the U.S. Treasury and securities issued or guaranteed by
agencies or instrumentalities of the U.S. government. Some U.S. government
securities are supported by the direct full faith and credit pledge of the U.S.
government; others are supported by the right of the issuer to borrow from the
U.S. Treasury; others, such as securities issued by the Federal National
Mortgage Association, are supported by the discretionary authority of the U.S.
government to purchase the agencies' obligations; and others are supported only

2 AMERICAN CENTURY INVESTMENTS

by the credit of the issuing or guaranteeing instrumentality. There is no
assurance that the U.S. government will provide financial support to an
instrumentality it sponsors when it is not obligated by law to do so.

REPURCHASE AGREEMENTS

In a repurchase agreement (repo), the fund buys a security at one price and
simultaneously agrees to sell it back to the seller at an agreed upon price on a
specified date (usually within seven days from the date of purchase) or on
demand. The repurchase price exceeds the purchase price by an amount that
reflects an agreed-upon rate of return and that is unrelated to the interest
rate on the underlying security. Delays or losses could result if the other
party to the agreement defaults or becomes bankrupt.

The manager attempts to minimize the risks associated with repurchase
agreements by adhering to written guidelines which govern repurchase agreements.
These guidelines strictly govern (i) the type of securities which may be
acquired and held under repurchase agreements; (ii) collateral requirements for
sellers under repurchase agreements; (iii) the amount of the fund's net assets
that may be committed to repurchase agreements that mature in more than seven
days; and (iv) the manner in which the fund must take delivery of securities
subject to repurchase agreements. Moreover, the Board of Directors reviews and
approves, on a quarterly basis, the creditworthiness of brokers, dealers and
banks with whom a fund may enter into repurchase agreements. A fund may enter
into a repurchase agreement only with an entity that appears on a list of those
which have been approved by the Board as sufficiently creditworthy.

The fund has received permission from the (SEC) to participate in joint
repurchase agreements collateralized by U.S. government securities with other
mutual funds advised by the manager. Joint repos are expected to increase the
income the fund can earn from repo transactions without increasing the risks
associated with these transactions.

WHEN-ISSUED AND FORWARD
COMMITMENT AGREEMENTS

The fund may engage in securities transactions on a when-issued or forward
commitment basis, in which the transaction price and yield are each fixed at the
time the commitment is made, but payment and delivery occur at a future date
(typically 15 to 45 days later).

When purchasing securities on a when-issued or forward commitment basis, the
fund assumes the rights and risks of ownership, including the risks of price and
yield fluctuations. While the fund will make commitments to purchase or sell
securities on a when-issued or forward commitment basis with the intention of
actually receiving or delivering them, it may nevertheless sell the securities
before the settlement date if it is deemed advisable as a matter of investment
strategy.

In purchasing securities on a when-issued or forward commitment basis, the
fund will establish and maintain, until the settlement date, a segregated
account consisting of cash or appropriate liquid assets including equity
securities and debt securities of any grade in an amount sufficient to meet the
purchase price. When the time comes to pay for when-issued securities, the fund
will meet its obligations with available cash, through the sale of securities,
or, although it would not normally expect to do so, through sales of the
when-issued securities themselves (which may have a market value greater or less
than the fund's payment obligation). Selling securities to meet when-issued or
forward commitment obligations may generate capital gains or losses.

As an operating policy, the fund will not commit more than 35% of its total
assets to when-issued or forward commitment agreements. If fluctuations in the
value of securities held cause more than 35% of the fund's total assets to be
committed under when-issued or forward commitment agreements, the manager need
not sell such commitments, but it will be restricted from entering into further
agreements on behalf of the fund until the percentage of assets committed to
such agreements is reduced to at least 35%. In addition, as an operating policy,
the fund will not enter into when-issued or forward commitment transactions with
settlement dates exceeding 120 days.

CONVERTIBLE SECURITIES

The fund may buy securities that are convertible into common stock. Listed
below is a brief description of the various types of convertible securities the
fund may buy.

STATEMENT OF ADDITIONAL INFORMATION 3

Convertible bonds are issued with lower coupons than nonconvertible bonds of
the same quality and maturity, but they give holders the option to exchange
their bonds for a specific number of shares of the company's common stock at a
predetermined price. This structure allows the convertible bond holder to
participate in share price movements in the company's common stock. The actual
return on a convertible bond may exceed its stated yield if the company's common
stock appreciates in value and the option to convert to common shares becomes
more valuable.

Convertible preferred stocks are nonvoting equity securities that pay a
fixed dividend. These securities have a convertible feature similar to
convertible bonds; however, they do not have a maturity date. Due to their fixed
income features, convertible issues typically are more sensitive to interest
rate changes than the underlying common stock. In the event of liquidation,
bondholders would have claims on company assets senior to those of stockholders;
preferred stockholders would have claims senior to those of common stockholders.

Warrants entitle the holder to buy the issuer's stock at a specific price
for a specific period of time. The price of a warrant tends to be more volatile
than, and does not always track, the price of its underlying stock. Warrants are
issued with expiration dates. Once a warrant expires, it has no value in the
market.

FOREIGN SECURITIES

Although the fund may buy securities of foreign issuers in foreign markets,
most of their foreign securities investments are made by purchasing American
Depositary Receipts (ADRs), "ordinary shares," or "New York Shares." The fund
may invest in foreign-currency-denominated securities that trade in foreign
markets if the manager believes that such investments will be advantageous to
the fund.

ADRs are dollar-denominated receipts representing interests in the
securities of a foreign issuer. They are issued by U.S. banks and traded on
exchanges or over the counter in the United States. Ordinary shares are shares
of foreign issuers that are traded abroad and on a U.S. exchange. New York
shares are shares that a foreign issuer has allocated for trading in the United
States. ADRs, ordinary shares, and New York shares all may be purchased with and
sold for U.S. dollars, which protects the fund from the foreign settlement risks
described below.

Investing in foreign companies may involve risks not typically associated
with investing in U.S. companies. The value of securities denominated in foreign
currencies and of dividends from such securities can change significantly when
foreign currencies strengthen or weaken relative to the U.S. dollar. Foreign
securities markets generally have less trading volume and less liquidity than
U.S. markets, and prices in some foreign markets can be very volatile.

Many foreign countries lack uniform accounting and disclosure standards
comparable to those that apply to U.S. companies, and it may be more difficult
to obtain reliable information regarding a foreign issuer's financial condition
and operations. In addition, the costs of foreign investing, including
withholding taxes, brokerage commissions, and custodial fees, are generally
higher than for U.S. investments.

Foreign markets may offer less protection to investors than U.S. markets.
Foreign issuers, brokers, and securities markets may be subject to less
governmental supervision. Foreign security trading practices, including those
involving the release of assets in advance of payment, may involve increased
risks in the event of a failed trade or the insolvency of a broker-dealer and
may involve substantial delays. It may also be difficult to enforce legal rights
in foreign countries.

Investing abroad carries political and economic risks distinct from those
associated with investing in the United States. Foreign investments may be
affected by actions of foreign governments adverse to the interests of U.S.
investors, including the possibility of expropriation or nationalization of
assets, confiscatory taxation, restrictions on U.S. investment, or restrictions
on the ability to repatriate assets or to convert currency into U.S. dollars.
There may be a greater possibility of default by foreign governments or foreign-
government-sponsored enterprises. Investments in foreign countries also involve
a risk of local political, economic, or social instability, military action or
unrest, or adverse diplomatic developments.

FOREIGN CURRENCY EXCHANGE TRANSACTIONS

The manager may engage in foreign currency exchange transactions on behalf
of the fund in order to manage currency risk. Foreign currencies will be

4 AMERICAN CENTURY INVESTMENTS

purchased and sold regularly, either in the spot (i.e., cash) market or in the
forward market (through forward foreign currency exchange contracts, or forward
contracts).

A forward foreign currency exchange contract is an obligation to purchase or
sell a specific currency at a future date, which may be any fixed number of days
agreed upon by the parties, commencing with the date of the contract, at a price
set at the time of the contract. When the fund agrees to buy or sell a security
denominated in a foreign currency, it may enter into a forward contract to "lock
in" the U.S. dollar price of the security. By entering into a forward contract
to buy or sell the amount of foreign currency involved in a security transaction
for a fixed amount of U.S. dollars, the manager can protect the fund against
possible loss resulting from adverse changes in the relationship between the
U.S. dollar and the foreign currency between the date the security is purchased
or sold and the date on which payment is made or received. This type of
transaction is sometimes referred to as a "position hedge."

However, it should be noted that using forward contracts to protect the
fund's foreign investments from currency fluctuations does not eliminate
fluctuations in the prices of the underlying securities themselves. Forward
contracts simply establish a rate of exchange that can be achieved at some
future point in time. Additionally, although forward contracts tend to minimize
the risk of loss due to a decline in the value of the hedged currency, they also
limit any gain that might result if the hedged currency's value increases.

Successful use of forward contracts depends on the manager's skill in
analyzing and predicting currency values. Although they are used for settlement
purposes, forward contracts alter the fund's exposure to currency exchange rate
activity and could result in losses to the fund if currencies do not perform as
the manager anticipates. The fund may also incur significant costs when
converting assets from one currency to another.

Foreign exchange dealers do not charge fees for currency conversions.
Instead, they realize a profit based on the difference (i.e., the spread)
between the prices at which they are buying and selling various currencies. A
dealer may offer to sell a foreign currency at one rate while simultaneously
offering a lesser rate of exchange on the purchase of that currency.

The fund uses forward contracts for currency hedging purposes only and not
for speculative purposes. The fund is not required to enter into forward
contracts with regard to their foreign holdings and will not do so unless it is
deemed appropriate by the manager.

The fund's assets are valued daily in U.S. dollars, although foreign
currency holdings are not physically converted into U.S. dollars on a daily
basis.

DEPOSITARY RECEIPTS

American Depositary Receipts and European Depositary Receipts (ADRs and
EDRs) are receipts representing ownership of shares of a foreign-based issuer
held in trust by a bank or similar financial institution. These are designed for
U.S. and European securities markets as alternatives to purchasing underlying
securities in their corresponding national markets and currencies. ADRs and EDRs
can be sponsored or unsponsored.

Sponsored ADRs and EDRs are certificates in which a bank or financial
institution participates with a custodian. Issuers of unsponsored ADRs and EDRs
are not contractually obligated to disclose material information in the United
States. Therefore, there may not be a correlation between such information and
the market value of the unsponsored ADR or EDR.

RESTRICTED SECURITIES

Restricted securities held by the fund generally can be sold in privately
negotiated transactions, pursuant to an exemption from registration under the
Securities Act of 1933, or in a registered public offering. Where registration
is required, the fund may be required to pay all or a part of the registration
expense, and a considerable period may elapse between the time it decides to
seek registration of the securities and the time it is permitted to sell them
under an effective registration statement. If, during this period, adverse
market conditions were to develop, the fund might obtain a less favorable price
than prevailed when it decided to try to register the securities.

PUT OPTIONS ON INDIVIDUAL SECURITIES

The fund may buy puts with respect to stocks underlying its convertible
security holdings. For

STATEMENT OF ADDITIONAL INFORMATION 5

example, if the manager anticipates a decline in the price of the stock
underlying a convertible security the fund holds, it may purchase a put option
on the stock. If the stock price subsequently declines, an increase in the value
of the put option could be expected to offset all or a portion of the effect of
the stock's decline on the value of the convertible security.

FUTURES AND OPTIONS TRANSACTIONS

FUTURES TRANSACTIONS. The fund may engage in futures transactions. Such
transactions may be used to maintain cash reserves while remaining fully
invested, to facilitate trading, to reduce transaction costs, or to pursue
higher investment returns when a futures contract is priced more attractively
than its underlying security or index.

Futures contracts provide for the sale by one party and purchase by another
party of a specific security at a specified future time and price. Futures
contracts are traded on national futures exchanges. Futures exchanges and
trading are regulated under the Commodity Exchange Act by the Commodity Futures
Trading Commission, a U.S. government agency.

Although futures contracts, by their terms, generally call for actual
delivery or acceptance of the underlying securities, in most cases the contracts
are closed out before the settlement date. Closing out a futures position is
done by taking an opposite position in an identical contract (i.e., buying a
contract that has previously been sold, or selling a contract that has
previously been bought).

To initiate and maintain open positions in futures contracts, the fund is
required to make a good faith margin deposit in cash or appropriate securities
with a broker or custodian. A margin deposit is intended to assure completion of
the contract (delivery or acceptance of the underlying security) if it is not
terminated prior to the specified delivery date. Minimum initial margin
requirements are established by the futures exchanges and may be revised. In
addition, brokers may establish deposit requirements that are higher than the
exchange minimums.

After a futures contract position is opened, the value of the contract is
marked to market daily. If the futures contract price changes to the extent that
the margin on deposit does not satisfy margin requirements, the contract holder
is required to pay an additional "variation" margin. Conversely, changes in the
contract value may reduce the required margin, resulting in a repayment of
excess margin to the contract holder. Variation margin payments are made to or
from the futures broker as long as the contract remains open and do not
constitute margin transactions for purposes of the fund's investment
restrictions.

Those who trade futures contracts may be broadly classified as either
"hedgers" or "speculators." Hedgers use the futures markets primarily to offset
unfavorable changes in the value of securities they hold or expect to acquire
for investment purposes. Speculators are less likely to own the securities
underlying the futures contracts they trade and are more likely to use futures
contracts with the expectation of realizing profits from fluctuations in the
prices of the underlying securities. The fund will not utilize futures contracts
for speculative purposes.

Although techniques other than trading futures contracts can be used to
control the fund's exposure to market fluctuations, the use of futures contracts
may be a more effective means of hedging this exposure. While the fund pays
brokerage commissions in connection with opening and closing out futures
positions, these costs are generally lower than the transaction costs incurred
in the purchase and sale of the underlying securities.

PURCHASING PUT AND CALL OPTIONS. By purchasing a put option, the fund
obtains the right (but not the obligation) to sell the option's underlying
instrument at a fixed "strike" price. In return for this right, the fund pays
the current market price for the option (known as the option premium). Options
have various types of underlying instruments, including specific securities,
indexes of securities prices, and futures contracts. The fund may terminate its
position in a put option it has purchased by allowing it to expire or by
exercising the option. If the option is allowed to expire, the fund will lose
the entire premium it paid. If the fund exercises the option, it completes the
sale of the underlying instrument at the strike price. The fund may also
terminate a put option position by closing it out in the secondary market at its
current price if a liquid secondary market exists.

The buyer of a typical put option can expect to realize a gain if security
prices fall substantially. However, if the underlying instrument's price does
not fall

6 AMERICAN CENTURY INVESTMENTS

enough to offset the cost of purchasing the option, a put buyer can expect to
suffer a loss (limited to the amount of the premium paid, plus related
transaction costs).

The features of call options are essentially the same as those of put
options, except that the purchaser of a call option obtains the right to
purchase, rather than sell, the underlying instrument at the option's strike
price. A call buyer typically attempts to participate in potential price
increases of the underlying instrument with risk limited to the cost of the
option if security prices fall. At the same time, the buyer can expect to suffer
a loss if security prices do not rise sufficiently to offset the cost of the
option.

WRITING PUT AND CALL OPTIONS. If the fund writes a put option, it takes the
opposite side of the transaction from the option's purchaser. In return for
receipt of the premium, the fund assumes the obligation to pay the strike price
for the option's underlying instrument if the other party chooses to exercise
the option. When writing an option on a futures contract, the fund will be
required to make margin payments to a broker or custodian as described above for
futures contracts. The fund may seek to terminate its position in a put option
before it is exercised by closing out the option in the secondary market at its
current price. If the secondary market is not liquid for a put option the fund
has written, however, the fund must continue to be prepared to pay the strike
price while the option is outstanding, regardless of price changes, and must
continue to set aside assets to cover its position.

If security prices rise, a put writer would generally expect to profit,
although the gain would be limited to the amount of the premium received. If
security prices remain the same over time, it is likely that the writer will
also profit by being able to close out the option at a lower price. If security
prices fall, the put writer would expect to suffer a loss. This loss should be
less than the loss from purchasing the underlying instrument directly, however,
because the premium received for writing the option should mitigate the effects
of the decline.

Writing a call option obligates the fund to sell or deliver the option's
underlying instrument in return for the strike price upon exercise of the
option. The characteristics of writing call options are similar to those of
writing put options, except that writing calls generally is a profitable
strategy if prices remain the same or fall. Through receipt of the option
premium, a call writer mitigates the effects of a price decline. At the same
time, because a call writer must be prepared to deliver the underlying
instrument in return for the strike price even if its current value is greater,
a call writer gives up some ability to participate in security price increases.

COMBINED POSITIONS. The fund may purchase and write options in combination
with one another, or in combination with futures or forward contracts, in order
to adjust the risk and return characteristics of the overall position. For
example, the fund may purchase a put option and write a call option on the same
underlying instrument in order to construct a combined position whose risk and
return characteristics are similar to selling a futures contract. Another
possible combined position would involve writing a call option at one strike
price and buying a call option at a lower price in order to reduce the risk of
the written call option in the event of a substantial price increase. Because
combined options positions involve multiple trades, they result in higher
transaction costs and may be more difficult to open and close out.

OVER-THE-COUNTER OPTIONS. Unlike exchange-traded options, which are
standardized with respect to the underlying instrument, expiration date,
contract size, and strike price, the terms of over-the-counter ("OTC") options
(options not traded on exchanges) generally are established through negotiation
with the other party to the option contract. While this type of arrangement
allows the fund greater flexibility in tailoring an option to its needs, OTC
options generally involve greater credit risk than exchange-traded options,
which are guaranteed by the clearing organizations of the exchanges where they
are traded. The risk of illiquidity is also greater with OTC options because
these options generally can be closed out only by negotiation with the other
party to the option.

OPTIONS ON FUTURES. By purchasing an option on a futures contract, the fund
obtains the right, but not the obligation, to sell the futures contract (a put
option) or to buy the contract (a call option) at a fixed "strike" price. The
fund can terminate its position in a put option by allowing it to expire or by
exercising the option. If the option is exercised, the fund completes the sale
of the underlying security at the

STATEMENT OF ADDITIONAL INFORMATION 7

strike price. Purchasing an option on a futures contract does not require the
fund to make margin payments unless the option is exercised.

CORRELATION OF PRICE CHANGES. Price changes of the fund's futures and
options positions may not be well correlated with price changes of its other
investments. This may be because of differences between the underlying indexes
and the types of securities the fund invests in. For example, if the fund sold a
broad-based index futures contract to hedge against a stock market decline while
completing sales of specific securities in its investment portfolio, the prices
of the securities could move in a different direction than the broad market
index represented by the index futures contract. In the case of an S&P 500
futures contract purchased by the fund, either in anticipation of stock
purchases or in an effort to be fully invested, failure of the contract to track
the Index accurately could hinder the fund from achieving its investment
objective.

Options and futures prices can also diverge from the prices of their
underlying instruments even if the underlying instruments match the fund's
investments. Options and futures prices are affected by factors such as current
and anticipated short-term interest rates, changes in volatility of the
underlying instrument, and the time remaining until expiration of the contract;
these factors may not affect security prices the same way. Imperfect correlation
may also result from differing levels of demand in the options and futures
markets and the securities markets, from structural differences in how options
and futures and securities are traded, or from the imposition of daily price
fluctuation limits or trading halts. The fund may purchase or sell options and
futures contracts with a greater or lesser value than the securities it wishes
to hedge or intends to purchase in an effort to compensate for differences in
volatility between the contract and the securities, although this strategy may
not be successful in all cases. If price changes in the fund's options or
futures positions are poorly correlated with its other investments, the
positions may fail to produce anticipated gains or result in losses that are not
offset by gains in other investments.

LIQUIDITY OF FUTURES CONTRACTS AND OPTIONS. There is no assurance a liquid
secondary market will exist for any particular futures contract or option at any
particular time. Options may have relatively low trading volume and liquidity if
their strike prices are not close to the underlying instrument's current price.
In addition, exchanges may establish daily price fluctuation limits for futures
contracts and options and may halt trading if a contract's price moves upward or
downward more than the limit in a given day. On volatile trading days when the
price fluctuation limit is reached or a trading halt is imposed, it may be
impossible for the fund to enter into new positions or close out existing
positions. If the secondary market for a contract were not liquid because of
price fluctuation limits or otherwise, prompt liquidation of unfavorable
positions could be difficult or impossible, and the fund could be required to
continue holding a position until delivery or expiration regardless of changes
in value. Under these circumstances, the fund's access to assets held to cover
its futures and options positions also could be impaired.

RESTRICTIONS ON THE USE OF FUTURES CONTRACTS AND OPTION. The fund has filed
a notice of eligibility for exclusion as a "commodity pool operator" with the
CFTC and the National Futures Association, which regulates trading in the
futures markets. The fund intends to comply with Section 4.5 of the regulations
under the Commodity Exchange Act, which limits the extent to which the fund can
commit assets to initial margin deposits and options premiums.

The fund may enter into futures contracts, options, or options on futures
contracts, provided that such obligations represent no more than 20% of the
fund's net assets. Under the Commodity Exchange Act, the fund may enter into
futures and options transactions for hedging purposes without regard to the
percentage of assets committed to initial margin and option premiums and for
other than hedging purposes provided that assets committed to initial margin and
option premiums do not exceed 5% of the fund's net assets. To the extent
required by law, the fund will set aside cash and appropriate liquid assets in a
segregated account to cover its obligations related to futures contracts and
options.

The fund intends to comply with tax rules applicable to regulated investment
companies.

FUTURES AND OPTIONS RELATING TO FOREIGN CURRENCIES. The fund may purchase
and sell cur-

8 AMERICAN CENTURY INVESTMENTS

rency futures and purchase and write currency options to increase or decrease
its exposure to different foreign currencies. The fund may also purchase and
write currency options in conjunction with each other or with currency futures
or forward contracts.

Currency futures contracts are similar to forward currency exchange
contracts, except that they are traded on exchanges (and have margin
requirements) and have standard contract sizes and delivery dates. Most currency
futures contracts call for payment or delivery in U.S. dollars. The underlying
instrument of a currency option may be a foreign currency, which generally is
purchased or delivered in exchange for U.S. dollars, although it may be a
futures contract. The purchaser of a currency call obtains the right to purchase
the underlying currency, and the purchaser of a currency put obtains the right
to sell the underlying currency.

The uses and risks of currency futures and options are similar to those of
futures and options relating to securities or indexes, as described above.
Currency futures and option values can be expected to correlate with exchange
rates, but may not reflect other factors that affect the value of the fund's
investments. A currency hedge, for example, should protect a
deutsche-mark-denominated security from a decline in the deutsche mark, but it
will not protect the fund against a price decline resulting from a deterioration
in the issuer's creditworthiness. Because the value of the fund's
foreign-currency-denominated investments will change in response to many factors
other than exchange rates, it may not be possible to match the amount of
currency options and futures to the value of the fund's foreign investments over
time.

PORTFOLIO LENDING

PORTFOLIO TURNOVER

With respect to each series of shares, the manager will purchase and sell
securities without regard to the length of time the security has been held.
Accordingly, the rate of portfolio turnover may be greater than other investment
companies with similar investment objectives.

The fund intends to purchase a given security whenever the manager believes
it will contribute to the stated objective of the fund, even if the same
security has only recently been sold. In selling a given security, the manager
keeps in mind that (1) profits from sales of securities held less than three
months must be limited in order to meet the requirements of Subchapter M of the
Internal Revenue Code, and (2) profits from sales of securities are taxed to
shareholders. Subject to those considerations, the fund will sell a given
security, no matter for how long or how short a period it has been held in the
portfolio and no matter whether the sale is at a gain or at a loss, if the
manager believes that the security is not fulfilling its purpose, either
because, among other things, it did not live up to the manager's expectations,
it may be replaced with another security holding greater promise, it has reached
its optimum potential, of a change in the circumstances of a particular company
or industry or in general economic conditions, or because of some combination of
such reasons.

When a general decline in securities prices is anticipated, the fund may
decrease its position and increase its cash position, and when a rise in price
levels is anticipated, the management may increase its equity position and
decrease its cash.

Since investment decisions are based on the anticipated contribution of the
security in question to a fund's objectives, the manager believes that the rate
of portfolio turnover is irrelevant when it believes a change is in order to
achieve those objectives, and a fund's annual portfolio turnover rate cannot be
anticipated and may be comparatively high. This disclosure regarding portfolio
turnover is a statement of fundamental policy and may be changed only by a vote
of the shareholders.

STATEMENT OF ADDITIONAL INFORMATION 9

PERFORMANCE

The fund may quote performance in various ways. Historical performance
information will be used in advertising and sales literature.

Yield quotations are based on the investment income per share earned during
a particular 30-day period, less expenses accrued during the period (net
investment income), and are computed by dividing a fund's net investment income
by its share price on the last day of the period, according to the following
formula:

YIELD = 2 [(a - b + 1)(6) - 1]
------
cd

where a = dividends and interest earned during the period, b = expenses accrued
for the period (net of reimbursements), c = the average daily number of shares
outstanding during the period that were entitled to receive dividends, and d =
the maximum offering price per share on the last day of the period.

Total returns quoted in advertising and sales literature reflect all aspects
of the fund's return, including the effect of reinvesting dividends and capital
gain distributions and any change in the fund's net asset value during the
period.

Average annual total returns are calculated by determining the growth or
decline in value of a hypothetical historical investment in the fund over a
stated period and then calculating the annually compounded percentage rate that
would have produced the same result if the rate of growth or decline in value
had been constant throughout the period. For example, a cumulative total return
of 100% over 10 years would produce an average annual total return of 7.18%,
which is the steady annual rate that would result in 100% growth on a compounded
basis in 10 years. While average annual total returns are a convenient means of
comparing investment alternatives, investors should realize that the fund's
performance is not constant over time but changes from year-to-year, and that
average annual returns represent averaged figures as opposed to actual
year-to-year performance.

The fund's average annual total return for the life of the fund period ended
December 31, 1997 is 7.80%.

OFFICERS AND DIRECTORS

JAMES E. STOWERS III* (39), Director; Chief Executive Officer and Director,
American Century Companies, Inc., American Century Investment Management, Inc.
and American Century Services Corporation.

THOMAS A. BROWN (58), Director; Director of Plains States Development,
Applied Industrial Technologies, Inc., a corporation engaged in the sale of
bearings and power transmission products.

ROBERT W. DOERING, M.D. (64), Director; retired, formerly general surgeon.

ANDREA C. HALL, PH.D. (53), Director; Senior Vice President and Associate
Director, Midwest Research Institute.

D.D. (DEL) HOCK (63), Director; retired, formerly Chairman, Public Service
Company of Colorado;

10 AMERICAN CENTURY INVESTMENTS

Director, Service Tech, Inc., Hathaway Corporation, and J. D. Edwards & Company.

DONALD H. PRATT (60), Vice Chairman of the Board and Director; President and
Director, Butler Manufacturing Company.

LLOYD T. SILVER JR. (70), Director; President, LSC, Inc., manufacturer's
representative.

M. JEANNINE STRANDJORD (52), Director; Senior Vice President and Treasurer,
Sprint Corporation; Director, DST Systems, Inc.

MARYANNE ROEPKE, CPA (42), Senior Vice President, Treasurer, and Principal
Accounting Officer; Senior Vice President, American Century Services
Corporation.

PATRICK A. LOOBY (39), Vice President; Vice President, American Century
Services Corporation.

JON ZINDEL, CPA (31), Tax Officer; Vice President and Director of Taxation,
American Century Services Corporation (1996); Tax Manager, Price Waterhouse LLP
(from 1989-1996).

MERELE A. MAY (35), Controller, Vice President, American Century Services
Corporation.

ROBERT LEACH, CPA (31), Controller.

C. JEAN WARDE, CPA (34), Controller.

The Board of Directors has established four standing committees, the
Executive Committee, the Audit Committee, the Compliance Committee and the
Nominating Committee.

Messrs. Brown (chair), Pratt and Silver and Dr. Hall constitute the
Compliance Committee. The functions of the Compliance Committee include
reviewing the results of the funds' compliance testing program, reviewing
quarterly reports from the manager to the Board regarding various compliance
matters and monitoring the implementation of the funds' Code of Ethics,
including violations thereof.

STATEMENT OF ADDITIONAL INFORMATION 11

companies an annual director's fee of $44,000, a fee of $1,000 per regular Board
meeting attended and $500 per special Board meeting and committee meeting
attended. In addition, those directors who are not "interested persons" who
serve as the chair of a committee of the Board of Directors receive an
additional $2,000 for such services. These fees and expenses are divided among
the six investment companies based upon their relative net assets. Under the
terms of the management agreement with the manager, the funds are responsible
for paying such fees and expenses. Set forth below is the aggregate compensation
paid for the periods indicated by the funds and by the American Century family
of funds as a whole to each director of the corporation who is not an
"interested person" as defined in the Investment Company Act.

Aggregate Total Compensation from
Compensation the American Century
Director from the Corporation(1) Family of Funds(2)
- -----------------------------------------------------------------------------

Thomas A. Brown $1,596 $60,000

Robert W. Doering, M.D. 1,317 49,500

Andrea C. Hall(3) 235 8,833

D. D. (Del) Hock 1,317 49,500

Linsley L. Lundgaard 1,126 42,333

Donald H. Pratt 1,596 60,000

Lloyd T. Silver Jr. 1,303 49,000

M. Jeannine Strandjord 1,299 48,833
- -----------------------------------------------------------------------------

(1)Includes compensation paid by the corporation for the fiscal year ended
December 31, 1997.

(2)Includes compensation paid by the 13 investment company members of the
American Century family of funds for the calendar year ended December 31, 1997.

(3)Andrea C. Hall replaced Linsley L. Lundgarrd as an independent director
effective November 1, 1997.

MANAGEMENT

A description of the responsibilities and method of compensation of the
fund's manager, American Century Investment Management, Inc. appears in the
Prospectus under the caption "Management."

The management fees paid by the fund from inception (September 2, 1997) to
December 31, 1997 equal $1,290.

The management agreement shall continue in effect until the earlier of the
expiration of two years from the date of its execution or until the first
meeting of shareholders following such execution and for as long thereafter as
its continuance is specifically approved at least annually by (i) the fund's
Board of Directors, or by the vote of a majority of the outstanding votes (as
defined in the Investment Company Act), and (ii) by the vote of a majority of
the Directors of the fund who are not parties to the agreement or interested
persons of the manager, cast in person at a meeting called for the purpose of
voting on such approval.

The management agreement provides that it may be terminated at any time
without payment of any penalty by the fund's Board of Directors, or by a vote of
a majority of the fund's shareholders, on 60 days' written notice to the
manager, and that it shall be automatically terminated if it is assigned.

The management agreement provides that the manager shall not be liable to
the fund or its shareholders for anything other than willful misfeasance, bad
faith, gross negligence or reckless disregard of its obligations or duties.

Certain investments may be appropriate for the funds and also for other
clients advised by the manager. Investment decisions for the funds and other
clients are made with a view to achieving their respective investment objectives
after consideration of such factors as their current holdings, availability of
cash for investment, and the size of their investment generally. A particular
security may be bought or sold for only one client or series, or in different
amounts and at different times for more than one but less than all clients or
series. In addition, purchases or sales of the same security may be made for two
or more clients or series on the same date. Such transactions will be allocated
among clients in a manner believed by the manager to be equitable to each. In
some cases this procedure could have an adverse effect on the price or amount of
the securities purchased or sold by a fund.

12 AMERICAN CENTURY INVESTMENTS

The funds' Board of Directors has approved the policy of the manager with
respect to the aggregation of portfolio transactions. Where portfolio
transactions have been aggregated, the funds participate at the average share
price for all transactions in that security on a given day and share transaction
costs on a pro rata basis. The manager will not aggregate portfolio transactions
of the funds unless it believes such aggregation is consistent with its duty to
seek best execution on behalf of the funds and the terms of the management
agreement. The manager receives no additional compensation or remuneration as a
result of such aggregation.

As stated in the Prospectus, all of the stock of American Century Services
Corporation and American Century Investment Management, Inc. is owned by
American Century Companies, Inc.

CUSTODIAN

Chase Manhattan Bank, N.A., 770 Broadway, New York, New York 10036 serves as
custodian of the assets of the fund. The custodian takes no part in determining
the investment policies of the fund or in deciding which securities are
purchased or sold by the fund. The fund, however, may invest in certain
obligations of the custodian and may purchase or sell certain securities from or
to the custodian.

INDEPENDENT AUDITORS

Deloitte & Touche LLP, 1010 Grand Avenue, Kansas City, Missouri 64106, are
the independent auditors of the fund. As the independent auditors of the fund,
Deloitte & Touche will provide services including (1) audit of the annual
financial statements, (2) assistance and consultation in connection with SEC
filings and (3) review of the annual federal income tax return filed for the
fund by American Century.

CAPITAL STOCK

The fund's capital stock is described in the Prospectus under the heading
"Further Information About American Century."

The corporation currently has six series of shares outstanding. The
corporation may in the future issue one or more additional series of shares. The
assets belonging to each series of shares are held separately by the custodian
and the shares of each series represent a beneficial interest in the principal,
earnings and profits (or losses) of investments and other assets held for each
series. Your rights as a shareholder are the same for all other series of
securities unless otherwise stated. Within their respective series, all shares
have equal redemption rights. Each share, when issued, is fully paid and
non-assessable. Each share, irrespective of series, is entitled to one vote for
each dollar of net asset value applicable to such share on all questions.

In the event of complete liquidation or dissolution of the funds,
shareholders of each series of shares shall be entitled to receive, pro rata,
all of the assets less the liabilities of that series.

As of February 28, 1998, 100% of the outstanding shares of the fund were
owned of record by Nationwide Life Insurance Company, Columbus, Ohio.

All of such shares of the fund are held for the benefit of the holders of
variable life and variable annuity policies issued by such insurance company.
Such shares are held in one or more accounts by entities controlled by such
insurance company.

BROKERAGE

Under the terms of the management agreement between the fund and the
manager, the manager has the responsibility of selecting brokers to execute
portfolio transactions. The fund's policy is to secure the

STATEMENT OF ADDITIONAL INFORMATION 13

most favorable prices and execution of orders on its portfolio transactions. So
long as that policy is met, the manager may take into consideration the factors
indicated below in selecting brokers or dealers.

The manager receives statistical and other information and services
(brokerage and research services, including industry and company analysis)
without cost from broker-dealers. The manager evaluates such information and
services, together with all other information that it may have, in supervising
and managing the investment portfolios of the fund. Because such information and
services may vary in amount, quality and reliability, their influence in
selecting brokers varies from none to very substantial. The manager proposes to
continue to place some of the brokerage business with one or more brokers who
provide information and services.

The brokerage and research services received by the manager may be used with
respect to the fund and/or one or more of the other funds and accounts over
which it has investment discretion, and not all of such services may be used by
the manager in managing the portfolios of the fund. Such information and
services are in addition to and not in lieu of the services required to be
performed for the fund by the manager. The manager does not utilize brokers that
provide such information and services for the purpose of reducing the expense of
providing required services to the fund.

Evaluation of the overall reasonableness of brokerage commissions is made by
the manager and reviewed by the Board of Directors of American Century Variable
Portfolios. In the year ended December 31, 1997, the fund paid brokerage
commissions of $505.

The brokerage commissions paid by the fund may exceed those that another
broker might have charged for effecting the same transactions, because of the
value of the brokerage and research services provided by the broker. Factors
considered in such determinations are skill in execution of orders and the
quality of brokerage and research services received. Research services furnished
by brokers through whom the fund effect securities transactions may be used by
the manager in servicing all of its accounts, and not all such services may be
used by the manager in managing the portfolios of the fund.

The staff of the SEC has expressed the view that the best price and
execution of over-the-counter transactions in portfolio securities may be
secured by dealing directly with principal market makers, thereby avoiding the
payment of compensation to another broker. In certain situations, the officers
of the fund and the manager believe that the facilities, expert personnel and
technological systems of a broker enable the fund to secure as good a net price
by dealing with a broker instead of a principal market maker, even after payment
of the compensation to the broker. The fund normally places its over-the-counter
transactions with principal market makers but also may deal on a brokerage basis
when utilizing electronic trading networks or as circumstances warrant.

REDEMPTIONS IN KIND

The corporation has elected to be governed by Rule 18f-1 under the
Investment Company Act of 1940, pursuant to which the fund is obligated to

14 AMERICAN CENTURY INVESTMENTS

redeem shares solely in cash up to the lesser of $250,000 or 1% of its net asset
value during any 90-day period for any one shareholder. Should redemptions by
any one contract owner exceed such limitation, the corporation will have the
option of redeeming the excess in cash or in kind. If shares are redeemed in
kind, the redeeming shareholder might incur brokerage costs in converting the
assets to cash. The securities delivered will be selected at the sole discretion
of the manager, and will not necessarily be representative of the entire
portfolio, and will be securities that the manager regards as least desirable.
The method of valuing portfolio securities used to make redemptions in kind will
be the same as the method of valuing portfolio securities described in the
Prospectus under the caption "How Share Price is Determined," and such valuation
will be made as of the same time the redemption price is determined.

HOLIDAYS

The fund does not determine the net asset value of its shares on days when
the New York Stock Exchange is closed. Currently, the Exchange is closed on
Saturdays and Sundays, and on holidays, namely New Year's Day, Martin Luther
King Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence Day,
Labor Day, Thanksgiving and Christmas.

FINANCIAL STATEMENTS

The financial statements of the fund for the fiscal year ended December 31,
1997, are included in the annual report to shareholders for that period, which
is incorporated herein by reference. You may receive copies of the annual report
without charge upon request to the fund at the address and telephone number
shown on page 1 of this Statement of Additional Information.

STATEMENT OF ADDITIONAL INFORMATION 15

P.O. BOX 419385
KANSAS CITY, MISSOURI
64141-6385

INSTITUTIONAL SERVICES:
1-800-345-3533 OR 816-531-5575

TELECOMMUNICATIONS DEVICE FOR THE DEAF:
1-800-345-1833 OR 816-444-3038

FAX: 816-340-4360

WWW.AMERICANCENTURY.COM

[american century logo(reg.sm)]
American
Century(reg.tm)

9803 [recycled logo]
SH-BKT-11944 Recycled
<PAGE>
AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.

PART C. OTHER INFORMATION.

ITEM 24. Financial Statements and Exhibits.

(a) Financial Statements:

(i) Financial Statements filed in Part A of the Registration
Statement:

1. Financial Highlights respecting shares of VP
Capital Appreciation.

2. Financial Highlights respecting shares of VP
Balanced.

3. Financial Highlights respecting shares of VP
Advantage.

4. Financial Highlights respecting shares of VP
International.

5. Financial Highlights respecting shares of VP
Value.

6. Financial Highlights respecting shares of VP
Income & Growth.

(ii) Financial Statements filed in Part B of the Registration
Statement respecting shares of VP Capital Appreciation
(each of the following financial statements is contained
in the Registrant's VP Capital Appreciation Annual
Report dated December 31, 1997, which is incorporated by
reference in Part B of this Registration Statement):

1. Statement of Assets and Liabilities at December
31, 1997.

2. Statement of Operations for the year ended
December 31, 1997.

3. Statements of Changes in Net Assets for the
years ended December 31, 1997 and 1996.

4. Notes to Financial Statements as of December 31,
1997 and 1996.

5. Schedule of Investments at December 31, 1997.

6. Independent Auditors' Report dated January 30,
1998.

(iii) Financial Statements filed in Part B of the Registration
Statement respecting shares of VP Balanced (each of the
following financial statements is contained in the
Registrant's VP Balanced Annual Report dated December
31, 1997, which is incorporated by reference in Part B
of this Registration Statement):

1. Statement of Assets and Liabilities at December
31, 1997.

2. Statement of Operations for the year ended
December 31, 1997.

3. Statements of Changes in Net Assets for the
years ended December 31, 1997 and 1996.

4. Notes to Financial Statements as of December 31,
1997 and 1996.

5. Schedule of Investments at December 31, 1997.

6. Independent Auditors' Report dated January 30,
1998.

(iv) Financial Statements filed in Part B of the Registration
Statement respecting shares of VP Advantage (each of the
following financial statements is contained in the
Registrant's VP Advantage Annual Report dated December
31, 1997, which is incorporated by reference in Part B
of this Registration Statement):

1. Statement of Assets and Liabilities at December
31, 1997.

2. Statement of Operations for the year ended
December 31, 1997.

3. Statements of Changes in Net Assets for the
years ended December 31, 1997 and 1996.

4. Notes to Financial Statements as of December 31,
1997 and 1996.

5. Schedule of Investments at December 31, 1997.

6. Independent Auditors' Report dated January 30,
1998.

(v) Financial Statements filed in Part B of the Registration
Statement respecting shares of VP International (each of
the following financial statements is contained in the
Registrant's VP International Annual Report dated
December 31, 1997, which is incorporated by reference in
Part B of this Registration Statement):

1. Statement of Assets and Liabilities at December
31, 1997.

2. Statement of Operations for the year ended
December 31, 1997.

3. Statement of Changes in Net Assets for the years
ended December 31, 1997 and 1996.

4. Notes to Financial Statements as of December 31,
1997 and 1996.

5. Schedule of Investments at December 31, 1997.

6. Independent Auditors' Report dated January 30,
1998.

(vi) Financial Statements filed in Part B of the Registration
Statement respecting shares of VP Value (each of the
following financial statements is contained in the
Registrant's VP Value Annual Report dated December 31,
1997, which is incorporated by reference in Part B of
this Registration Statement):

1. Statement of Assets and Liabilities at December
31, 1997.

2. Statement of Operations for the year ended
December 31, 1997.

3. Statement of Changes in Net Assets for the year
ended December 31, 1997 and 1996.

4. Notes to Financial Statements as of December 31,
1997 and 1996.

5. Schedule of Investments at December 31, 1997.

6. Independent Auditors' Report dated January 30,
1998.

(vii) Financial Statements filed in Part B of the Registration
Statement respecting shares of VP Income & Growth (each
of the following financial statements is contained in
the Registrant's VP Income & Growth Annual Report dated
December 31, 1997, which is incorporated by reference in
Part B of this Registration Statement):

1. Statement of Assets and Liabilities at December
31, 1997.

2. Statement of Operations for the year ended
December 31, 1997.

3. Statement of Changes in Net Assets for the year
ended December 31, 1997.

4. Notes to Financial Statements as of December 31,
1997.

5. Schedule of Investments at December 31, 1997.

6. Independent Auditors' Report dated January 30,
1998.

(b) Exhibits.

1.1 Articles of Incorporation of TCI Portfolios, Inc. dated
June 3, 1987 (filed electronically as Exhibit 1.1 to
Post-Effective Amendment No. 17 on Form N-1A, File No.
33-14567, accession #814680-96-000002, and incorporated
herein by reference).

1.2 Articles of Amendment of TCI Portfolios, Inc. dated July
22, 1988 (filed electronically as Exhibit 1.2 to
Post-Effective Amendment No. 17 on Form N-1A, File No.
33-14567, accession #814680-96-000002, and incorporated
herein by reference).

1.3 Articles of Amendment of TCI Portfolios, Inc. dated
August 11, 1993 (filed electronically as Exhibit 1.3 to
Post-Effective Amendment No. 17 on Form N-1A, File No.
33-14567, accession #814680-96-000002, and incorporated
herein by reference).

1.4 Articles Supplementary of TCI Portfolios, Inc., dated
November 30, 1992 (filed electronically as Exhibit 1.4
to Post-Effective Amendment No. 18 on Form N-1A, File
No. 33-14567, accession #814680-96-000007, and
incorporated herein by reference).

1.5 Articles Supplementary of TCI Portfolios, Inc., dated
April 24, 1995 (filed electronically as Exhibit 1.5 to
Post-Effective Amendment No. 18 on Form N-1A, File No.
33-14567, accession #814680-96-000007, and incorporated
herein by reference).

1.6 Articles Supplementary of TCI Portfolios, Inc., dated
March 11, 1996 (filed electronically as Exhibit 1.6 to
Post-Effective Amendment No. 17 on Form N-1A, File No.
33-14567, and incorporated herein by reference).

1.7 Articles of Amendment of TCI Portfolios, Inc., dated
April 1, 1997 (filed electronically as Exhibit 1.7 to
Post-Effective Amendment No. 20 to the Registration
Statement of the Registrant on Form N-1A, File No.
33-14567, and incorporated herein by reference).

1.8 Articles Supplementary of American Century Variable
Portfolios, Inc., dated May 1, 1997 (filed
electronically as Exhibit 1.8 to Post-Effective
Amendment No. 20 to the Registration Statement of the
Registrant on Form N-1A, File No. 33-14567, and
incorporated herein by reference).

1.9 Articles Supplementary of American Century Variable
Portfolios, Inc. dated July 28, 1997 (filed herein as
EX-99.B1.9).

2.1 Amended and Restated By-Laws of TCI Portfolios, Inc.
(filed as Exhibit 2 to Post-Effective Amendment No. 17
on Form N-1A, File No. 33-14567, accession
#814680-96-000002, and incorporated herein by
reference).

2.2 Amendment to Amended and Restated By-Laws of American
Century Variable Portfolios, Inc. (filed herein as
EX-99.B2.2).

3. Voting Trust Agreements - None.

4. Specimen Securities - None.

5.1 Investment Management Agreement between TCI Portfolios,
Inc. and Investors Research Corporation dated August 1,
1994 (filed electronically as Exhibit 5 to
Post-Effective Amendment No. 17 on Form N-1A, File No.
33-14567, accession #814680-96-000002, and incorporated
herein by reference).

5.2 Addendum to Investment Management Agreement dated April
1, 1996, between TCI Portfolios, Inc. and Investors
Research Corporation (filed electronically as Exhibit
5.2 to Post-Effective Amendment No. 18 on Form N-1A,
File No. 33-14567, accession #814680-96-000007, and
incorporated herein by reference).

5.3 Addendum to Management Agreement dated September 15,
1997, between American Century Variable Portfolios, Inc.
and American Century Investment Management, Inc. (filed
herein as EX-99.B5.3).

6. Distribution Agreement between American Century Variable
Portfolios, Inc. and Funds Distributor, Inc. dated
January 15, 1998 (filed electronically as Exhibit 6 to
Post-Effective Amendment No. 28 on Form N-1A of American
Century Target Maturities Trust, File No. 2-94608, and
incorporated herein by reference).

7. Bonus and Profit Sharing Plan, Etc. - None.

8.1 Custody Agreement with UMB Bank, N.A.(filed as Exhibit
8.2 to Post-Effective Amendment No. 17, File No.
33-14567, accession #814680-96-000002, and incorporated
herein by reference).

8.2 Amendment No. 1 to Custody Agreement with UMB Bank,
N.A., dated January 25, 1996 (filed electronically as a
part of Post-Effective Amendment No. 6 to the
Registration Statement on Form N-1A of American Century
World Mutual Funds, Inc., File No. 33-39242, filed March
29, 1996 and incorporated herein by reference).

8.3 Global Custody Agreement between The Chase Manhattan
Bank and the Twentieth Century and Benham Funds, dated
August 9, 1996 (filed electronically as a part of
Post-Effective Amendment No. 31 to the Registration
Statement on Form N-1A of American Century Government
Income Trust, File No. 2-99222, filed February 7, 1997,
and incorporated herein by reference).

9. Transfer Agency Agreement with Twentieth Century
Services, Inc. (formerly J.E. Stowers & Company) dated
October 15, 1987 (filed as Exhibit 9 to Post-Effective
Amendment No. 19 on Form N-1A, File No. 33-14567, and
incorporated herein by reference).

10. Opinion and Consent of Janet A. Nash, Esq. (filed herein
as EX-99.B10).

11. Consent of Deloitte & Touche LLP (filed herein as
EX-99.B11).

12.1 Annual Report of VP Capital Appreciation for the year
ended December 31, 1997 (filed electronically on
February 19, 1998).

12.2 Annual Report of VP Balanced for the year ended December
31, 1997 (filed electronically on February 19, 1998).

12.3 Annual Report of VP Advantage for the year ended
December 31, 1997 (filed electronically on February 19,
1998).

12.4 Annual Report of VP International for the year ended
December 31, 1997 (filed electronically on February 19,
1998).

12.5 Annual Report of VP Value for the year ended December
31, 1997 (filed electronically on February 19, 1998).

12.6 Annual Report of VP Income & Growth for the year ended
December 31, 1997 (filed electronically on February 19,
1998).

13. Agreements for Initial Capital, Etc. - None.

14. Model Retirement Plans - None.

15. 12b-1 Plans - None.

16. Schedule of Computation for Performance Advertising
Quotations (filed herein as EX-99.B16).

17. Power of Attorney (filed herein as EX-99.B17).

27.1.1 Financial Data Schedule for VP Capital Appreciation
(EX-27.1.1)

27.7.2 Financial Data Schedule for VP Balanced (EX-27.1.2)

27.7.3 Financial Data Schedule for VP Advantage (EX-27.1.3)

27.1.4 Financial Data Schedule for VP International (EX-27.1.4)

27.1.5 Financial Data Schedule for VP Value (EX-27.1.5)

27.1.6 Financial Data Schedule for VP Income & Growth
(EX-27.1.6)

ITEM 25. Persons Controlled by or Under Common Control with Registrant - None.

ITEM 26. Number of Holders of Securities.

Number of Record Holders
Title of Series as of February 28, 1998
--------------- -----------------------
VP Capital Appreciation 27
VP Balanced 16
VP Advantage 3
VP International 13
VP Value 9
VP Income & Growth 1

ITEM 27. Indemnification.

The Registrant is a Maryland corporation. Section 2- 418 of the
Maryland General Corporation Law allows a Maryland corporation to
indemnify its officers, directors, employees and agents to the extent
provided in such statute.

Article XIII of the Registrant's Amended Articles of Incorporation,
Exhibits 1(a) and 1(b), requires the indemnification of the
Registrant's directors and officers to the extent permitted by
Section 2-418 of the Maryland General Corporation Law, the Investment
Company Act of 1940 and all other applicable laws.

The Registrant has purchased an insurance policy insuring its
officers and directors against certain liabilities which such
officers and directors may incur while acting in such capacities and
providing reimbursement to the Registrant for sums which it may be
permitted or required to pay to its officers and directors by way of
indemnification against such liabilities, subject in either case to
clauses respecting deductibility and participation.

ITEM 28. Business and Other Connections of Investment Advisor.

American Century Investment Management, Inc., the investment advisor,
is engaged in the business of managing investments for registered
investment companies, deferred compensation plans and other
institutional investors.

ITEM 29. Principal Underwriters.

(a) Funds Distributor, Inc. (the "Distributor") acts as principal
underwriter for the following investment companies.

American Century California Tax-Free and Municipal Funds
American Century Capital Portfolios, Inc.
American Century Government Income Trust
American Century International Bond Funds
American Century Investment Trust
American Century Municipal Trust
American Century Mutual Funds, Inc.
American Century Premium Reserves, Inc.
American Century Quantitative Equity Funds
American Century Strategic Asset Allocations, Inc.
American Century Target Maturities Trust
American Century Variable Portfolios, Inc.
American Century World Mutual Funds, Inc.
BJB Investment Funds
The Brinson Funds
Dresdner RCM Capital Funds, Inc.
Dresdner RCM Equity Funds, Inc.
Harris Insight Funds Trust
HT Insight Funds, Inc. d/b/a Harris Insight Funds
J.P. Morgan Institutional Funds
J.P. Morgan Funds
The JPM Series Trust
The JPM Series Trust II
LaSalle Partners Funds, Inc.
Monetta Fund, Inc.
Monetta Trust
The Montgomery Funds
The Montgomery Funds II
The Munder Framlington Funds Trust
The Munder Funds Trust
The Munder Funds, Inc.
Orbitex Group of Funds
St. Clair Funds, Inc.
The Skyline Funds
Waterhouse Investors Family of Funds, Inc.
WEBS Index Fund, Inc.

The Distributor is registered with the Securities and Exchange
Commission as a broker-dealer and is a member of the National
Association of Securities Dealers. The Distributor is located at
60 State Street, Suite 1300, Boston, Massachusetts 02109. The
Distributor is an indirect wholly-owned subsidiary of Boston
Institutional Group, Inc., a holding company all of whose
outstanding shares are owned by key employees.

(b) The following is a list of the executive officers, directors
and partners of the Distributor:

<TABLE>
Name and Principal Business Positions and Offices with Positions and Offices with
Address* Underwriter Registrant

<S> <C> <C>
Marie E. Connolly Director, President and Chief none
Executive Officer

Richard W. Ingram Executive Vice President President, Principal Executive
and Principal Financial Officer

Donald R. Roberson Executive Vice President none

William S. Nichols Executive Vice President none

Michael S. Petrucelli Senior Vice President none

Joseph F. Tower, III Director, Senior Vice President, none
Treasurer and Chief Financial
Officer

Paula R. David Senior Vice President none

Allen B. Closser Senior Vice President none

Bernard A. Whalen Senior Vice President none

William J. Nutt Director none
- --------------------
* All addresses are 60 State Street, Suite 1300, Boston, Massachusetts 02109
</TABLE>

ITEM 30. Location of Accounts and Records.

All accounts, books and other documents required to be maintained by
Section 31(a) of the 1940 Act, and the rules promulgated thereunder,
are in the possession of Registrant, American Century Services
Corporation and American Century Investment Management, Inc., all
located at American Century Tower, 4500 Main Street, Kansas City,
Missouri 64111.

ITEM 31. Management Services - None.

ITEM 32. Undertakings.

(a) Not applicable.
(b) Not applicable.
(c) The Registrant hereby undertakes to furnish each person to
whom a prospectus is delivered with a copy of the Registrant's
latest annual report to shareholders, upon request and without
charge.
(d) The Registrant hereby undertakes that it will, if requested to
do so by the holders of at least 10% of the Registrant's
outstanding votes, call a meeting of shareholders for the
purpose of voting upon the question of the removal of a
director and to assist in communication with other
shareholders as required by Section 16(C).
<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, American Century Variable Portfolios, Inc., the
Registrant, certifies that it meets all the requirements for effectiveness of
the Post-Effective Amendment No. 23 to its Registration Statement on Form N-1A
pursuant to Rule 485(b) promulgated under the Securities Act of 1933, as
amended, and has duly caused this Post-Effective Amendment No. 23 to its
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Kansas City, State of Missouri on the 23rd day
of April, 1998.

American Century Variable Portfolios, Inc.
(Registrant)

By:/s/Patrick A. Looby
Patrick A. Looby, Vice President

Pursuant to the requirements of the Securities Act of 1933, this
Post-Effective Amendment No. 23 has been signed below by the following persons
in the capacities and on the dates indicated.

<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>
*Richard W. Ingram President, Principal Executive April 23, 1998
- ------------------------- and Principal Financial Officer
Richard W. Ingram

*Maryanne Roepke Vice President and Treasurer April 23, 1998
- -------------------------
Maryanne Roepke

*James E. Stowers, Jr. Director April 23, 1998
- -------------------------
James E. Stowers, Jr.

*James E. Stowers III Director April 23, 1998
- -------------------------
James E. Stowers, III

*Thomas A. Brown Director April 23, 1998
- -------------------------
Thomas A. Brown

*Robert W. Doering, M.D. Director April 23, 1998
- -------------------------
Robert W. Doering, M.D.

*Andrea C. Hall, Ph.D. Director April 23, 1998
- -------------------------
Andrea C. Hall, Ph.D.

*D. D. (Del) Hock Director April 23, 1998
- -------------------------
D. D. (Del) Hock

*Donald H. Pratt Director April 23, 1998
- -------------------------
Donald H. Pratt

*Lloyd T. Silver, Jr. Director April 23, 1998
- -------------------------
Lloyd T. Silver, Jr.

*M. Jeannine Strandjord Director April 23, 1998
- -------------------------
M. Jeannine Strandjord
</TABLE>

*By /s/Patrick A. Looby
Patrick A. Looby
Attorney-in-Fact

EXHIBIT INDEX

Exhibit Description of Document
Number

EX-99.B1.1 Articles of Incorporation of TCI Portfolios, Inc. dated June 3,
1987 (filed as Exhibit 1.1 to Post-Effective Amendment No. 17 to
the Registration Statement on Form N-1A of the Registrant, File
No. 33-14567, accession #814680-96-000002, and incorporated
herein by reference).

EX-99.B1.2 Articles of Amendment of TCI Portfolios, Inc. dated July 22,
1988 (filed as Exhibit 1.2 to Post-Effective Amendment No. 17 to
the Registration Statement on Form N-1A of the Registrant, File
No. 33-14567, accession #814680-96-000002, and incorporated
herein by reference).

EX-99.B1.3 Articles of Amendment of TCI Portfolios, Inc. dated August 11,
1993 (filed as Exhibit 1.3 to Post-Effective Amendment No. 17 to
the Registration Statement on Form N-1A of the Registrant, File
No. 33-14567, accession #814680-96-000002, and incorporated
herein by reference).

EX-99.B1.4 Articles Supplementary of TCI Portfolios, Inc., dated November
30, 1992 (filed as Exhibit 1.4 to Post-Effective Amendment No.
18 to the Registration Statement on Form N-1A of the Registrant,
File No. 33-14567, accession #814680-96-000007, and incorporated
herein by reference).

EX-99.B1.5 Articles Supplementary of TCI Portfolios, Inc., dated April 24,
1995 (filed as Exhibit 1.5 to Post-Effective Amendment No. 18 to
the Registration Statement on Form N-1A of the Registrant, File
No. 33-14567, accession #814680-96-000007, and incorporated
herein by reference).

EX-99.B1.6 Articles Supplementary of TCI Portfolios, Inc., dated March 11,
1996 (filed as Exhibit 1.6 to Post-Effective Amendment No. 19 to
the Registration Statement on Form N-1A of the Registrant, File
No. 33-14567, and incorporated herein by reference).

EX-99.B1.7 Articles of Amendment of TCI Portfolios, Inc., dated April 1,
1997 (filed as Exhibit 1.7 to Post-Effective Amendment No. 20 to
the Registration Statement on Form N-1A of the Registrant, File
No. 33-14567, and incorporated herein by reference).

EX-99.B1.8 Articles Supplementary of American Century Variable Portfolios,
Inc. dated May 1, 1997 (filed as Exhibit 1.8 to Post-Effective
Amendment No. 20 to the Registration Statement on Form N-1A of
the Registrant, File No. 33-14567, and incorporated herein by
reference).

EX-99.B1.9 Articles Supplementary of American Century Variable Portfolios,
Inc. dated July 28, 1997, is included herein.

EX-99.B2.1 Amended and Restated By-Laws of TCI Portfolios, Inc.(filed as
Exhibit 2 to Post-Effective Amendment No. 17 to the Registration
Statement on Form N-1A of the Registrant, File No. 33-14567,
accession #814680-96-000002, and incorporated herein by
reference).

EX-99.B2.2 Amendment to Amended and Restated By-Laws of American Century
Variable Portfolios, Inc., is included herein.

EX-99.B5.1 Investment Management Agreement between TCI Portfolios, Inc. and
Investors Research Corporation dated August 1, 1994 (filed as
Exhibit 5 to Post-Effective Amendment No. 17 to the Registration
Statement on Form N-1A of the Registrant, File No. 33-14567,
accession #814680-96-000002, and incorporated herein by
reference).

EX-99.B5.2 Addendum to Investment Management Agreement dated April 1, 1996,
between TCI Portfolios, Inc. and Investors Research Corporation
(filed as Exhibit 5.2 to Post-Effective Amendment No. 18 to the
Registration Statement on Form N-1A of the Registrant, File No.
33-14567, accession #814680-96-000007, and incorporated herein
by reference).

EX-99.B5.3 Addendum to Management Agreement dated September 15, 1997
between American Century Variable Portfolios, Inc. and American
Century Management Investment, Inc. is included herein.

EX-99.B6 Distribution Agreement between American Century Variable
Portfolios, Inc. and Funds Distributor, Inc., dated January 15,
1998 (filed as Exhibit 6.1 to Post-Effective Amendment No. 28 to
the Registration Statement on Form N-1A of the American Century
Target Maturities Trust, File No. 2-94608, and incorporated
herein by reference).

EX-99.B8.1 Custody Agreement dated September 12, 1995, with UMB Bank,
N.A.(filed as Exhibit 8.2 to Post-Effective Amendment No. 17,
File No. 33-14567, accession #814680-96-000002, and incorporated
herein by reference).

EX-99.B8.2 Amendment No. 1 to Custody Agreement with UMB Bank, N.A. dated
January 25, 1996 (filed as Exhibit 8b to Post-Effective
Amendment No. 6 to the Registration Statement on Form N-1A of
American Century World Mutual Funds, Inc., File No. 33-39242,
filed March 29, 1996 and incorporated herein by reference).

EX-99.B8.3 Global Custody Agreement between The Chase Manhattan Bank and
the Twentieth Century and Benham Funds, dated August 9, 1996
(filed as Exhibit B8 to Post-Effective Amendment No. 31 to the
Registration Statement on Form N-1A of American Century
Government Income Trust, File No. 2-99222, filed February 7,
1997, and incorporated herein by reference).

EX-99.B9 Transfer Agency Agreement with Twentieth Century Services, Inc.
(formerly J. E. Stowers & Company) dated October 15, 1987 (filed
as Exhibit 9 to Post-Effective Amendment No. 19 to the
Registration Statement on Form N-1A of the Registrant, File No.
33-14567, and incorporated herein by reference).

EX-99.B10 Opinion and Consent of Janet A. Nash, Esq., is included herein.

EX-99.B11 Consent of Deloitte & Touche LLP, is included herein.

EX-99.B12.1 Annual Report of VP Capital Appreciation for the year ended
December 31, 1997 (filed February 19, 1998, File No. 33-14567,
accession #814680-97-000001, and incorporated herein by
reference).

EX-99.B12.2 Annual Report of VP Balanced for the year ended December 31,
1997 (filed February 19, 1998, File No. 33-14567, accession
#814680-97-000001, and incorporated herein by reference).

EX-99.B12.3 Annual Report of VP Advantage for the year ended December 31,
1997 (filed February 19, 1998, File No. 33-14567, accession
#814680-97-000001, and incorporated herein by reference).

EX-99.B12.4 Annual Report of VP International for the year ended December
31, 1997 (filed February 19, 1998, File No. 33-14567, accession
#814680-97-000001, and incorporated herein by reference).

EX-99.B12.5 Annual Report of VP Value for the year ended December 31, 1997
(filed February 19, 1998, File No. 33-14567, accession
#814680-97-000001, and incorporated herein by reference).

EX-99.B12.6 Annual Report of VP Income & Growth for the year ended December
31, 1997 (filed February 19, 1998, File No. 33-14567, accession
#814680-97-000001, and incorporated herein by reference).

EX-99.B16 Schedule of Computation for Performance Advertising Quotations.

EX-99.B17 Power of Attorney dated January 23, 1998.

EX-27.1.1 Financial Data Schedule for American Century VP Capital
Appreciation.

EX-27.7.2 Financial Data Schedule for American Century VP Balanced.

EX-27.7.3 Financial Data Schedule for American Century VP Advantage.

EX-27.1.4 Financial Data Schedule for American Century VP International.

EX-27.1.5 Financial Data Schedule for American Century VP Value.

EX-27.1.6 Financial Data Schedule for American Century VP Income & Growth.

AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.

ARTICLES SUPPLEMENTARY

AMERICAN CENTURY VARIABLE PORTFOLIOS, INC., a Maryland corporation
whose principal Maryland office is located in Baltimore, Maryland (the
"Corporation"), hereby certifies to the State Department of Assessments and
Taxation of Maryland that:

FIRST: Pursuant to authority expressly vested in the Board of Directors
by the Maryland General Corporation Law and by Article FIFTH and Article SEVENTH
of the Articles of Incorporation, the Board of Directors of the Corporation (a)
has duly established a new series of shares titled American Century VP Income &
Growth (hereinafter referred to as a "Series") for the Corporation's stock and
has allocated Two Hundred Million (200,000,000) shares of the One Billion Five
Hundred Million (1,500,000,000) shares of authorized capital stock of the
Corporation, par value One Cent ($0.01) per share, for an aggregate par value of
Two Million Dollars ($2,000,000) to the new Series. As a result of the action
taken by the Board of Directors in Article FIRST of these Articles
Supplementary, the six (6) Series of stock of the Corporation and the number of
shares and aggregate par value of each is as follows:

Series Number of Shares Aggregate Par Value

American Century VP Value 500,000,000 $5,000,000

American Century VP International 200,000,000 $2,000,000

American Century VP Capital Appreciation 200,000,000 $2,000,000

American Century VP Balanced 200,000,000 $2,000,000

American Century VP Advantage 200,000,000 $2,000,000

American Century VP Income & Growth 200,000,000 $2,000,000

The par value of each shares of stock in each Series is One Cent ($0.01) per
share.

SECOND: Except as otherwise provided by the express provisions of these
Articles Supplementary, nothing herein shall limit, by inference or otherwise,
the discretionary right of the Board of Directors to serialize, classify or
reclassify and issue any unissued shares of any Series or Class or any unissued
shares that have not been allocated to a Series or Class, and to fix or alter
all terms thereof, to the full extent provided by the Articles of Incorporation
of the Corporation.

THIRD: A description of the series and classes of shares, including the
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends, qualifications, and terms and conditions for
redemption is set forth in the Articles of Incorporation of the Corporation and
is not changed by these Articles Supplementary, except with respect to the
creation and/or designation of the various Series.

FOURTH: The Board of Directors of the Corporation duly adopted
resolutions dividing into Series the authorized capital stock of the Corporation
and allocating shares to each Series as set forth in these Articles
Supplementary.

FIFTH: The Board of Directors of the Corporation duly adopted
resolutions establishing a new Series and allocating shares to the Series.

IN WITNESS WHEREOF, AMERICAN CENTURY VARIABLE PORTFOLIOS, INC. has
caused these Articles Supplementary to be signed and acknowledged in its name
and on its behalf by its Vice President and its corporate seal to be hereunto
affixed and attested to by its Assistant Secretary on this 28th day of July,
1997.

AMERICAN CENTURY VARIABLE
ATTEST: PORTFOLIOS, INC.

/s/ Charles E. Etherington By: /s/ Patrick A. Looby
Name: Charles A. Etherington Name: Patrick A. Looby
Title: Assistant Secretary Title: Vice President

THE UNDERSIGNED Vice President of AMERICAN CENTURY VARIABLE PORTFOLIOS,
INC., who executed on behalf of said Corporation the foregoing Articles
Supplementary to the Charter, of which this certificate is made a part, hereby
acknowledges, in the name of and on behalf of said Corporation, the foregoing
Articles Supplementary to the Charter to be the corporate act of said
Corporation, and further certifies that, to the best of his knowledge,
information and belief, the matters and facts set forth therein with respect to
the approval thereof are true in all material respects under the penalties of
perjury.

Dated: July 28, 1997 /s/ Patrick A. Looby
--------------------------------
Patrick A. Looby, Vice President

AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.

RESOLVED, that the By-laws of this Corporation are hereby amended by
deleting Section 23 in its entirety and replacing it with the following:

OFFICERS

Section 23. The officers of the Corporation shall be chosen by the
Board of Directors and shall include a President, a Vice President, a
Secretary and a Treasurer. The Board of Directors may also choose a
Chairman of the Board, a Vice Chairman of the Board, additional Vice
Presidents, one or more Assistant Vice Presidents, Assistant
Secretaries and Assistant Treasurers. If chosen, the Chairman and Vice
Chairman of the Board shall be selected from among the Directors but
shall not be considered officers of the Corporation. Officers of the
Corporation shall be elected by the Board of Directors at its first
meeting after each annual meeting of stockholders. If no annual meeting
of stockholders shall be held in any year, such election of officers
may be held at any regular or special meeting of the Board of Directors
as shall be determined by the Board of Directors.

RESOLVED, that the By-laws of this Corporation are hereby amended by
deleting Section 30 in its entirety and replacing it with the following, adding
Section 31 and renumbering the Sections following thereafter:

VICE PRESIDENTS AND ASSISTANT VICE PRESIDENTS

Section 30. The Vice President, or if there shall be more than one, the
Vice Presidents in the order determined by the Board of Directors,
shall, in the absence or disability of the President, perform the
duties and exercise the powers of the President, and shall perform such
other duties and have such other powers as the Board of Directors may
from time to time prescribe.

Section 31. The Assistant Vice President, if any, or if there be more
than one, the Assistant Vice Presidents in the order determined by the
Board of Directors, shall, in the absence or disability of the Vice
President, perform the duties and exercise the powers of the Vice
President and shall perform such other duties and have such other
powers as the Board of Directors may from time to time prescribe.

RESOLVED, that the By-laws of this Corporation are hereby amended by
adding the following Sections 38 and 39, and renumbering the Sections following
thereafter:

CHAIRMAN AND VICE CHAIRMAN OF THE BOARD

Section 38. If a Chairman of the Board be elected, he shall preside at
all meetings of the stockholders and Directors at which he may be
present and shall have such other duties, powers and authority as may
be prescribed elsewhere in these By-laws. The Board of Directors may
delegate such other authority and assign such additional duties to the
Chairman of the Board, other than those conferred by law exclusively
upon the President.

Section 39. If a Vice Chairman of the Board be elected, he shall
preside at all meetings of the stockholders and Directors at which the
Chairman is absent and shall have such other duties, powers and
authority as may be prescribed elsewhere in these By-laws. The Board of
Directors may delegate such other authority and assign such additional
duties to the Vice Chairman of the Board, other than those conferred by
law exclusively upon the President.

* * * * * *

I, the undersigned, being the Secretary of the Corporation, do hereby
certify that the foregoing amendments to the By-laws were adopted by the Board
of Directors of the Corporation on November 22, 1997, to be effective January
15, 1998.

/s/ Patrick A. Looby
Patrick A. Looby, Secretary

ADDENDUM TO MANAGEMENT AGREEMENT

This Addendum, dated as of September 15, 1997, supplements the
Management Agreement (the "Agreement") dated as of August 1, 1994, by and
between American Century Variable Portfolios, Inc., f/k/a TCI Portfolios, Inc.
("ACVP") and American Century Investment Management, Inc., f/k/a Investors
Research Corporation ("ACIM").

IN CONSIDERATION of the mutual promises and conditions herein
contained, the parties agree as follows (all capitalized terms used herein and
not otherwise defined having the meaning given them in the Agreement):

1. ACIM shall manage the following series (the "New Series") of shares
to be issued by ACVP, and for such managmeent shall recieve the Applicable Fee
set forth below:

Name of Series Applicable Fee
-------------- --------------

VP Income & Growth 0.70%

2. ACIM shall manage the New Series in accordance with the terms and
conditions specified in the Agreement for its existing management
responsibilities.

IN WITNESS WHEREOF, the parties have caused this Addendum to the
Agreement to be executed by their respective duly authorized officers as of the
day and year first above written.

Attest: AMERICAN CENTURY
VARIABLE PORTFOLIOS, INC.

/s/ Patrick A. Looby /s/ William M. Lyons
Patrick A. Looby William M. Lyons
Secretary Executive Vice President

Attest: AMERICAN CENTURY INVESTMENT
MANAGEMENT, INC.

/s/ Patrick A. Looby /s/ William M. Lyons
Patrick A. Looby Willliam M. Lyons
Assistant Secretary Executive Vice President

Janet A. Nash
Attorney at Law
4500 Main Street * P.O. Box 418210
Kansas City, Missouri 64141-9210

April 27, 1998

American Century Variable Portfolios, Inc.
American Century Tower
4500 Main Street
Kansas City, Missouri 64111

Ladies and Gentlemen:

As counsel to American Century Variable Portfolios, Inc. (the
"Corporation"), I am generally familiar with its affairs. Based upon this
familiarity, and upon the examination of such documents as I deemed relevant, it
is my opinion that the shares of the Corporation described in Post-Effective
Amendment No. 23 to its Registration Statement on Form N-1A, to be filed with
the Securities and Exchange Commission on April 27, 1998, will, when issued, be
validly issued, fully paid and nonassessable.

For the record, it should be stated that I am an employee of American
Century Services Corporation, an affiliated corporation of American Century
Investment Management, Inc., the investment advisor of the Corporation.

I hereby consent to the use of this opinion as an exhibit to Post-
Effective Amendment No. 23.

Very truly yours,

/s/Janet A. Nash
Janet A. Nash

Independent Auditors' Consent

We consent to the incorporation be reference in this Post-Effective Amendment
No. 23 to Registration Statement No. 33-14567 of American Century Variable
Portfolios, Inc. on Form N-1A of our Independent Auditors' Reports dated January
30, 1998, appearing in the Annual Reports of the six funds comprising American
Century Variable Portfolios, Inc. for the year ended December 31, 1997, and to
the reference to us under the heading "Financial Highlights" in the
Prospectuses, which are part of such Registration Statement.

/s/Deloitte & Touche LLP
Deloitte & Touche LLP

Kansas City, Missouri
April 23, 1998

SCHEDULE OF COMPUTATION OF PERFORMANCE ADVERTISING QUOTATIONS

Set forth below are representative calculations of each type of total
return performance quotation included in the Statement of Additional Information
of American Century Variable Portfolios, Inc.

1. Average annual total return. The average one-year annual total
return of VP Advantage as quoted in the Statement of Additional
Information, was 12.83%.

This return was calculated as follows:

P(1+T)n = ERV
where,

P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years
ERV = ending redeemable value of the hypothetical $1,000 payment at the
end of the period.

Applying the actual return figures of the fund for the one year period
ended December 31, 1997.

1,000 (1+T)1 = $1,128.30

1
(1,128.30)
T = ----------- - 1
(1,000)

T = 12.83%

2. Cumulative total return. The cumulative total return of VP Advantage
from August 1, 1991 (inception) to December 31, 1997 as quoted in the
Statement of Additional Information, was 70.14%

This return was calculated as follows:

P
C = (ERV - P)
where,

C = cumulative total return
P = a hypothetical initial payment of $1,000
ERV = ending redeemable value of the hypothetical $1,000 payment at the
end of the period.

Applying the actual return figures of the fund for the period August 1,
1991 through December 31, 1997.

(1,701.40 - 1,000)
C = ------------------
1,000

C = 70.14%

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that the undersigned, American Century
Variable Portfolios, Inc., hereinafter called the "Corporation", and certain
directors and officers of the Corporation, do hereby constitute and appoint
Richard W. Ingram, Patrick A. Looby, Charles A. Etherington, David H.
Reinmiller, and Charles C.S. Park, and each of them individually, their true and
lawful attorneys and agents to take any and all action and execute any and all
instruments which said attorneys and agents may deem necessary or advisable to
enable the Corporation to comply with the Securities Act of 1933 and/or the
Investment Company Act of 1940, as amended, and any rules, regulations, orders,
or other requirements of the United States Securities and Exchange Commission
thereunder, in connection with the registration under the Securities Act of 1933
and/or the Investment Company Act of 1940, as amended, including specifically,
but without limitation of the foregoing, power and authority to sign the name of
the Corporation in its behalf and to affix its corporate seal, and to sign the
names of each of such directors and officers in their capacities as indicated,
to any amendment or supplement to the Registration Statement filed with the
Securities and Exchange Commission under the Securities Act of 1933 and/or the
Investment Company Act of 1940, as amended, and to any instruments or documents
filed or to be filed as a part of or in connection with such Registration
Statement; and each of the undersigned hereby ratifies and confirms all that
said attorneys and agents shall do or cause to be done by virtue hereof.

IN WITNESS WHEREOF, the Corporation has caused this Power to be
executed by its duly authorized officers on this the 23rd day of January, 1998.

AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.

By: /s/ Richard W. Ingram
Richard W. Ingram, President

SIGNATURE AND TITLE

/s/ Richard W. Ingram /s/ Robert W. Doering
Richard W. Ingram Robert W. Doering, M.D.
President, Principal Executive and Principal Director
Financial Officer

/s/ Maryanne Roepke /s/ Andrea C. Hall
Maryanne Roepke Andrea C. Hall, Ph.D.
Vice President and Treasurer Director

/s/ James E. Stowers, Jr. /s/ Donald H. Pratt
James E. Stowers, Jr. Donald H. Pratt
Director Director

/s/ James E. Stowers III /s/ Lloyd T. Silver
James E. Stowers III Lloyd T. Silver
Director Director

/s/ Thomas A. Brown /s/ M. Jeannine Strandjord
Thomas A. Brown M. Jeannine Strandjord
Director Director

Attest: /s/ D.D. (Del) Hock
D.D. ("Del") Hock
By: /s/ Patrick A. Looby Director
Patrick A. Looby, Secretary

<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE ANNUAL
REPORT OF AMERICAN CENTURY MUTUAL FUNDS, INC. AND IS QUALIFIED IN ITS ENTIRETY
BY REFERENCE TO SUCH REPORT.
</LEGEND>
<CIK> 0000814680
<NAME> AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.
<SERIES>
<NUMBER> 1
<NAME> AMERICAN CENTURY VP CAPITAL APPRECIATION

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<S> <C>
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