<PAGE> PAGE 1
000 B000000 01/31/2000
000 C000000 0000843063
000 D000000 N
000 E000000 NF
000 F000000 Y
000 G000000 N
000 H000000 N
000 I000000 6.1
000 J000000 A
001 A000000 MSDW HIGH INCOME ADVANTAGE TRUST III
001 B000000 811-5700
001 C000000 2123922550
002 A000000 TWO WORLD TRADE CENTER
002 B000000 NEW YORK
002 C000000 NY
002 D010000 10048
003 000000 N
004 000000 N
005 000000 N
006 000000 N
007 A000000 N
007 B000000 0
007 C010100 1
007 C010200 2
007 C010300 3
007 C010400 4
007 C010500 5
007 C010600 6
007 C010700 7
007 C010800 8
007 C010900 9
007 C011000 10
008 A000001 MORGAN STANLEY DEAN WITTER ADVISORS INC.
008 B000001 A
008 C000001 801-42061
008 D010001 NEW YORK
008 D020001 NY
008 D030001 10048
012 A000001 MORGAN STANLEY DEAN WITTER TRUST FSB
012 B000001 84-1785
012 C010001 JERSEY CITY
012 C020001 NJ
012 C030001 07311
013 A000001 PRICEWATERHOUSECOOPERS LLP.
013 B010001 NEW YORK
013 B020001 NY
013 B030001 10036
014 A000001 DEAN WITTER REYNOLDS INC.
014 B000001 8-14172
014 A000002 MORGAN STANLEY & CO. INCORPORATED
014 B000002 8-15869
<PAGE> PAGE 2
015 A000001 THE BANK OF NEW YORK
015 B000001 C
015 C010001 NEW YORK
015 C020001 NY
015 C030001 10286
015 E010001 X
018 000000 Y
019 A000000 Y
019 B000000 131
019 C000000 MSDW-FUNDS
020 A000001 NONE
020 C000001 0
020 C000002 0
020 C000003 0
020 C000004 0
020 C000005 0
020 C000006 0
020 C000007 0
020 C000008 0
020 C000009 0
020 C000010 0
021 000000 0
022 A000001 BANK OF NEW YORK (THE)
022 B000001 13-5160382
022 C000001 286275
022 D000001 0
022 A000002 GOLDMAN, SACHS & CO.
022 B000002 13-5108880
022 C000002 24821
022 D000002 0
022 A000003 MERRILL LYNCH, PIERCE, FENNER & SMITH INC.
022 B000003 13-5674085
022 C000003 10649
022 D000003 212
022 A000004 LEHMAN BROTHERS INC.
022 B000004 13-2518466
022 C000004 3185
022 D000004 3383
022 A000005 DONALDSON, LUFKIN & JENRETTE SECURITIES
022 B000005 13-2741729
022 C000005 1185
022 D000005 2156
022 A000006 BEAR, STEARNS & CO. INC.
022 B000006 13-3299429
022 C000006 1986
022 D000006 1245
022 A000007 CIBC OPPENHEIMER CORPORATION
022 B000007 13-5492430
022 C000007 999
022 D000007 853
022 A000008 BANC OF AMERICA SECURITIES LLC.
<PAGE> PAGE 3
022 B000008 56-2058405
022 C000008 731
022 D000008 460
022 A000009 FLEET SECURITIES, INC.
022 B000009 13-3217611
022 C000009 261
022 D000009 629
022 A000010 SCHRODER WERTHEIM & CO. INC.
022 B000010 13-5659485
022 C000010 198
022 D000010 675
023 C000000 335765
023 D000000 15672
024 000000 Y
025 A000001 BANK OF NEW YORK
025 B000001 13-5160382
025 C000001 D
025 D000001 642
025 D000002 0
025 D000003 0
025 D000004 0
025 D000005 0
025 D000006 0
025 D000007 0
025 D000008 0
026 A000000 N
026 B000000 Y
026 C000000 N
026 D000000 Y
026 E000000 N
026 F000000 N
026 G010000 N
026 G020000 N
026 H000000 N
027 000000 N
028 A010000 0
028 A020000 0
028 A030000 0
028 A040000 0
028 B010000 0
028 B020000 0
028 B030000 0
028 B040000 0
028 C010000 0
028 C020000 0
028 C030000 0
028 C040000 0
028 D010000 0
028 D020000 0
028 D030000 0
028 D040000 0
<PAGE> PAGE 4
028 E010000 0
028 E020000 0
028 E030000 0
028 E040000 0
028 F010000 0
028 F020000 0
028 F030000 0
028 F040000 0
028 G010000 0
028 G020000 0
028 G030000 0
028 G040000 0
028 H000000 0
030 A000000 0
030 B000000 0.00
030 C000000 0.00
031 A000000 0
031 B000000 0
032 000000 0
033 000000 0
035 000000 0
036 B000000 0
038 000000 0
042 A000000 0
042 B000000 0
042 C000000 0
042 D000000 0
042 E000000 0
042 F000000 0
042 G000000 0
042 H000000 0
043 000000 0
044 000000 0
045 000000 Y
046 000000 N
047 000000 Y
048 000000 0.000
048 A010000 250000
048 A020000 0.750
048 B010000 250000
048 B020000 0.600
048 C010000 250000
048 C020000 0.500
048 D010000 250000
048 D020000 0.400
048 E010000 0
048 E020000 0.000
048 F010000 0
048 F020000 0.000
048 G010000 0
048 G020000 0.000
<PAGE> PAGE 5
048 H010000 0
048 H020000 0.000
048 I010000 0
048 I020000 0.000
048 J010000 0
048 J020000 0.000
048 K010000 1000000
048 K020000 0.300
049 000000 N
050 000000 N
051 000000 N
052 000000 N
053 A000000 N
054 A000000 Y
054 B000000 Y
054 C000000 Y
054 D000000 N
054 E000000 N
054 F000000 N
054 G000000 Y
054 H000000 Y
054 I000000 N
054 J000000 Y
054 K000000 N
054 L000000 Y
054 M000000 Y
054 N000000 N
054 O000000 Y
055 A000000 Y
055 B000000 N
056 000000 Y
057 000000 N
058 A000000 N
059 000000 Y
060 A000000 Y
060 B000000 Y
061 000000 0
062 A000000 Y
062 B000000 0.0
062 C000000 0.0
062 D000000 0.6
062 E000000 0.0
062 F000000 0.0
062 G000000 0.0
062 H000000 0.0
062 I000000 0.0
062 J000000 0.0
062 K000000 0.0
062 L000000 0.0
062 M000000 0.0
062 N000000 0.0
<PAGE> PAGE 6
062 O000000 0.0
062 P000000 95.6
062 Q000000 0.0
062 R000000 1.8
063 A000000 0
063 B000000 7.0
064 A000000 N
064 B000000 Y
065 000000 N
066 A000000 N
067 000000 N
068 A000000 N
068 B000000 N
069 000000 N
070 A010000 Y
070 A020000 Y
070 B010000 Y
070 B020000 N
070 C010000 Y
070 C020000 N
070 D010000 N
070 D020000 N
070 E010000 Y
070 E020000 N
070 F010000 N
070 F020000 N
070 G010000 Y
070 G020000 N
070 H010000 N
070 H020000 N
070 I010000 N
070 I020000 N
070 J010000 Y
070 J020000 Y
070 K010000 N
070 K020000 N
070 L010000 Y
070 L020000 Y
070 M010000 N
070 M020000 N
070 N010000 Y
070 N020000 N
070 O010000 N
070 O020000 N
070 P010000 Y
070 P020000 N
070 Q010000 N
070 Q020000 N
070 R010000 Y
070 R020000 N
071 A000000 22329
<PAGE> PAGE 7
071 B000000 23323
071 C000000 55582
071 D000000 40
072 A000000 12
072 B000000 9178
072 C000000 0
072 D000000 0
072 E000000 0
072 F000000 435
072 G000000 0
072 H000000 0
072 I000000 40
072 J000000 8
072 K000000 0
072 L000000 20
072 M000000 12
072 N000000 25
072 O000000 0
072 P000000 0
072 Q000000 0
072 R000000 45
072 S000000 25
072 T000000 0
072 U000000 0
072 V000000 0
072 W000000 13
072 X000000 623
072 Y000000 0
072 Z000000 8555
072AA000000 2167
072BB000000 3378
072CC010000 0
072CC020000 11007
072DD010000 9012
072DD020000 0
072EE000000 0
073 A010000 0.7000
073 A020000 0.0000
073 B000000 0.0000
073 C000000 0.0000
074 A000000 0
074 B000000 313
074 C000000 0
074 D000000 49597
074 E000000 205
074 F000000 86
074 G000000 0
074 H000000 0
074 I000000 642
074 J000000 0
074 K000000 0
<PAGE> PAGE 8
074 L000000 1368
074 M000000 2
074 N000000 52213
074 O000000 250
074 P000000 33
074 Q000000 0
074 R010000 0
074 R020000 0
074 R030000 0
074 R040000 60
074 S000000 0
074 T000000 51870
074 U010000 12838
074 U020000 0
074 V010000 4.04
074 V020000 0.00
074 W000000 0.0000
074 X000000 0
074 Y000000 0
075 A000000 0
075 B000000 57868
076 000000 4.19
077 A000000 Y
077 B000000 Y
077 C000000 N
077 D000000 N
077 E000000 N
077 F000000 N
077 G000000 N
077 H000000 N
077 I000000 N
077 J000000 N
077 K000000 N
077 L000000 N
077 M000000 N
077 N000000 N
077 O000000 N
077 P000000 N
077 Q010000 N
077 Q020000 Y
077 Q030000 N
078 000000 N
080 A000000 ICI MUTUAL
080 B000000 CONTINENTAL, RELIANCE, VIGILANT, GULF, AETNA
080 C000000 120000
081 A000000 Y
081 B000000 130
082 A000000 N
082 B000000 0
083 A000000 N
083 B000000 0
<PAGE> PAGE 9
084 A000000 N
084 B000000 0
085 A000000 Y
085 B000000 N
086 A010000 0
086 A020000 0
086 B010000 39
086 B020000 151
086 C010000 0
086 C020000 0
086 D010000 0
086 D020000 0
086 E010000 0
086 E020000 0
086 F010000 0
086 F020000 0
087 A010000 SHARES OF BENEFICIAL INTERSET
087 A020000 61745P403
087 A030000 YLH
088 A000000 N
088 B000000 N
088 C000000 N
088 D000000 N
SIGNATURE BARRY FINK
TITLE VICE PRESIDENT
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
MORGAN STANLEY DEAN WITTER HIGHT INCOME ADVANTAGE TRUST III
</LEGEND>
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> JAN-31-2000
<PERIOD-END> JAN-31-2000
<INVESTMENTS-AT-COST> 79,071,520
<INVESTMENTS-AT-VALUE> 50,842,647
<RECEIVABLES> 1,367,611
<ASSETS-OTHER> 2,259
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 52,212,517
<PAYABLE-FOR-SECURITIES> (250,000)
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> (93,131)
<TOTAL-LIABILITIES> (343,131)
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 111,277,286
<SHARES-COMMON-STOCK> 12,837,779
<SHARES-COMMON-PRIOR> 12,876,779
<ACCUMULATED-NII-CURRENT> 541,544
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (31,720,571)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> (28,228,873)
<NET-ASSETS> 51,869,386
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 9,178,570
<OTHER-INCOME> 0
<EXPENSES-NET> (623,388)
<NET-INVESTMENT-INCOME> 8,555,182
<REALIZED-GAINS-CURRENT> (1,211,052)
<APPREC-INCREASE-CURRENT> (11,007,329)
<NET-CHANGE-FROM-OPS> (3,663,199)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (9,012,471)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (12,827,015)
<ACCUMULATED-NII-PRIOR> 998,833
<ACCUMULATED-GAINS-PRIOR> (40,157,175)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> (435,204)
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> (623,388)
<AVERAGE-NET-ASSETS> 57,868,291
<PER-SHARE-NAV-BEGIN> 5.02
<PER-SHARE-NII> 0.66
<PER-SHARE-GAIN-APPREC> (0.94)
<PER-SHARE-DIVIDEND> (0.70)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 4.04
<EXPENSE-RATIO> 1.08
</TABLE>
Report of Independent Accountants
To the Shareholders and Trustees of
Morgan Stanley Dean Witter High Income Advantage Trust III
In planning and performing our audit of the financial
statements of Morgan Stanley Dean Witter High Income
Advantage Trust III (the "Trust") for the year ended
January 31, 2000, 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 Trust 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 controls may become inadequate because of
changes in conditions or that the effectiveness of their
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 or 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 January 31, 2000.
This report is intended solely for the information and use of
the Trustees, management and the Securities and
Exchange Commission and is not intended to be and should not
be used by
anyone other than these specified parties.
March 7, 2000
Item 77Q2 Exhibit
Fund: Morgan Stanley Dean Witter High Income Advantage
Trust III
Section 16(a) Beneficial Ownership Reporting Compliance
The following persons are "reporting persons" under Section
16 of the Securities Exchange Act of 1934 and had not
previously filed an "Initial Statement of Beneficial
Ownership of Securities" on Form 3:
Mitchell M. Merin
Ronald E. Robison
Joseph J. McAlinden
Edwin J. Garn
Manuel H. Johnson
Michael E. Nugent
Wayne E. Hedien
Barry Fink
Peter M. Avelar
None of the above reporting persons has ever held any shares
of the Trust.
