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SUPPLEMENT DATED SEPTEMBER 21, 1998
TO STATEMENT OF ADDITIONAL INFORMATION DATED MAY 1, 1998
MORGAN STANLEY INSTITUTIONAL FUND, INC. (THE "FUND")
P.O. BOX 2798
BOSTON, MASSACHUSETTS
02208-2798
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The Statement of Additional Information is being supplemented to reflect the
addition of disclosure concerning investment in Structured Notes. Accordingly,
the following paragraph is inserted as the first paragraph on page 17:
STRUCTURED NOTES
The Portfolios, to the extent consistent with their investment objectives
and policies, may invest in Structured Notes. Structured notes are
derivative securities for which the amount of principal repayment and/or
interest payments is based upon the movement of one or more "factors." These
factors include, but are not limited to, currency exchange rates, interest
rates (such as the prime lending rate and LIBOR) and stock indices, such as
the S&P 500. In some cases, the impact of the movements of these factors may
increase or decrease through the use of multipliers or deflators. Structured
Notes may be designed to have particular quality and maturity
characteristics and may vary from money market quality to below investment
grade. Depending on the factor used and the use of multipliers or deflators,
however, changes in interest rates and movement of the factor may cause
significant price fluctuations or may cause particular Structured Notes to
become illiquid. The Portfolios will use Structured Notes to tailor their
investments to the specific risks and returns the Adviser wishes to accept
while avoiding or reducing certain other risks.
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PLEASE RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE
