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<PAGE> PAGE 2
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<PAGE> PAGE 3
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<PAGE> PAGE 7
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<PAGE> PAGE 15
SIGNATURE DOUGLAS H. MCCORKINDALE
TITLE TREASURER
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000828990
<NAME> THE HIGH YIELD PLUS FUND, INC.
<SERIES>
<NUMBER> 001
<NAME> THE HIGH YIELD PLUS FUND, INC.
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> MAR-31-1998
<PERIOD-END> MAR-31-1998
<INVESTMENTS-AT-COST> 128,010,923
<INVESTMENTS-AT-VALUE> 131,131,119
<RECEIVABLES> 8,355,291
<ASSETS-OTHER> 2,754,709
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 142,241,119
<PAYABLE-FOR-SECURITIES> 6,484,839
<SENIOR-LONG-TERM-DEBT> 30,000,000
<OTHER-ITEMS-LIABILITIES> 1,197,908
<TOTAL-LIABILITIES> 37,682,747
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 104,270,784
<SHARES-COMMON-STOCK> 11,348,544
<SHARES-COMMON-PRIOR> 11,250,532
<ACCUMULATED-NII-CURRENT> 310,599
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (3,143,207)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 3,120,196
<NET-ASSETS> 104,558,372
<DIVIDEND-INCOME> 225,226
<INTEREST-INCOME> 11,712,150
<OTHER-INCOME> 0
<EXPENSES-NET> 2,458,213
<NET-INVESTMENT-INCOME> 9,479,163
<REALIZED-GAINS-CURRENT> 5,009,438
<APPREC-INCREASE-CURRENT> 2,649,914
<NET-CHANGE-FROM-OPS> 17,138,515
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (9,479,163)
<DISTRIBUTIONS-OF-GAINS> (19,779)
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 876,479
<NET-CHANGE-IN-ASSETS> 8,516,052
<ACCUMULATED-NII-PRIOR> 330,378
<ACCUMULATED-GAINS-PRIOR> (8,152,645)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 505,151
<INTEREST-EXPENSE> 1,374,351
<GROSS-EXPENSE> 2,458,213
<AVERAGE-NET-ASSETS> 100,766,000
<PER-SHARE-NAV-BEGIN> 8.54
<PER-SHARE-NII> 0.84
<PER-SHARE-GAIN-APPREC> 0.67
<PER-SHARE-DIVIDEND> (0.84)
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<EXPENSE-RATIO> 1.07
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</TABLE>
May 14, 1998
To the Shareholders and Board of Directors of
The High Yield Plus Fund, Inc.
In planning and performing our audit of the
financial statements of The High Yield Plus
Fund, Inc. (the "Fund") for the year ended March
31, 1998, we considered its internal control,
including control activities for safeguarding
securities, in order to determine our auditing
procedures for the purpose of expressing our
opinion on the financial statements and to
comply with the requirements of Form N-SAR, not
to provide assurance on internal control.
The management of the Fund is responsible for
establishing and maintaining internal control.
In fulfilling this responsibility, estimates and
judgments by management are required to assess
the expected benefits and related costs of
controls. Generally, controls that are relevant
to an audit pertain to the entity's objective of
preparing financial statements for external
purposes that are fairly presented in conformity
with generally accepted accounting principles.
Those controls include the safeguarding of
assets against unauthorized acquisition, use or
disposition.
Because of inherent limitations in internal
control, errors or fraud may occur and not be
detected. Also, projection of any evaluation of
internal control to future periods is subject to
the risk that it may become inadequate because
of changes in conditions or that the
effectiveness of the design and operation may
deteriorate.
Our consideration of internal control would not
necessarily disclose all matters in internal
control that might be material weaknesses under
standards established by the American Institute
of Certified Public Accountants. A material
weakness is a condition in which the design or
operation of one or more of the internal control
components does not reduce to a relatively low
level the risk that misstatements caused by
error of fraud in amounts that would be material
in relation to the financial statements being
audited may occur and not be detected within a
timely period by employees in the normal course
of performing their assigned functions.
However, we noted no matters involving internal
control and its operation, including controls
for safeguarding securities, that we consider to
be material weaknesses as defined above as of
March 31, 1998.
This report is intended solely for the
information and use of management and the Board
of Directors of the Fund and the Securities and
Exchange Commission.
PRICE WATERHOUSE LLP
SUB-ITEM 77D
On November 12, 1997, the Registrant's Board of
Directors approved the following changes to the
Registrant's investment policies:
(A) Investments in Restricted and Illiquid
Securities
The Fund may invest up to 25% of its total
assets in securities that are restricted as to
disposition under the federal securities laws or
otherwise not readily marketable, including
Bridge Loans and Mezzanine Debt Investments (as
well as repurchase agreements maturing in more
than seven days). However, no more than 10% of
the Fund's total assets will be invested in any
one private offering. Securities eligible for
resale in accordance with Rule 144A under the
Securities Act of 1933, as amended, that have
legal or contractual restrictions on resale but
are otherwise liquid shall not be subject to
this limitation. The Investment Adviser will
monitor the liquidity of such restricted
securities under the supervision of the Board of
Directors.
(B) Investments in Foreign Securities
The Fund may invest in U.S. and non-U.S. dollar-
denominated high yield foreign debt securities
issued by foreign companies. U.S. and non-U.S.
dollar-denominated high yield debt securities
issued or guaranteed by foreign governments,
quasi-governmental entities, governmental
agencies, supranational entities and other
governmental entities, and high yield debt
securities of U.S., corporate and governmental
issuers may also be purchased. No more than 20%
of the Fund's total assets will be invested in
non-U.S. dollar-denominated foreign debt or
equity.
\t:dconnor\high yield plus\598nsar77d.doc
