AMERICAN CENTURY WORLD MUTUAL FUNDS INC, 497, 1997-01-15

AMERICAN CENTURY WORLD MUTUAL FUNDS INC
497, 1997-01-15

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PROSPECTUS

[american century logo]
American
Century(sm)

SEPTEMBER 3, 1996
REVISED JANUARY 1, 1997

TWENTIETH
CENTURY(R)
GROUP

International Growth
International Discovery

INSTITUTIONAL CLASS

[front cover]

AMERICAN CENTURY INVESTMENTS

FAMILY OF FUNDS

American Century Investments offers you nearly 70 fund choices covering
stocks, bonds, money markets, specialty investments and blended portfolios. To
help you find the funds that may meet your needs, American Century funds have
been divided into three groups based on investment style and objectives. These
groups, which appear below, are designed to help simplify your fund decisions.

AMERICAN CENTURY INVESTMENTS

BENHAM GROUP(R) AMERICAN CENTURY GROUP TWENTIETH CENTURY GROUP

MONEY MARKET FUNDS ASSET ALLOCATION & GROWTH FUNDS
GOVERNMENT BOND FUNDS BALANCED FUNDS INTERNATIONAL FUNDS
DIVERSIFIED BOND FUNDS CONSERVATIVE EQUITY FUNDS
MUNICIPAL BOND FUNDS SPECIALTY FUNDS

International Growth
International Discovery

[inside front cover]

PROSPECTUS
SEPTEMBER 3, 1996
REVISED JANUARY 1, 1997

International Growth
International Discovery

INSTITUTIONAL CLASS

AMERICAN CENTURY WORLD MUTUAL FUNDS, INC.

American Century World Mutual Funds, 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. Two of the funds from our
Twentieth Century Group that invest primarily in equity securities are described
in this Prospectus. Their investment objectives are listed on page 2 of this
Prospectus.

RISK OF FOREIGN INVESTMENTS

Investment in securities of foreign issuers typically involves a greater
degree of risk than investment in domestic securities. See "Risk Factors," page
9.

Each fund's shares offered by this Prospectus (the Institutional Class
shares) are sold at their net asset value with no sales charges or commissions.

The Institutional Class shares are made available for purchase by large
institutional shareholders, such as bank trust departments, corporations,
endowments, foundations and financial advisors that meet the funds' minimum
investment requirements. Institutional Class shares are not available for
purchase by insurance companies or participant-directed employer-sponsored
retirement plans.

This Prospectus gives you information about the funds 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 September 3, 1996, 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 o P.O. Box 419385
Kansas City, Missouri 64141-6385 o 1-800-345-3533
International calls: 816-531-5575
Telecommunications Device for the Deaf:
1-800-345-1833 o In Missouri: 816-753-0700
Internet: www.americancentury.com

Additional information, including this Prospectus and the Statement of
Additional Information, may be obtained by accessing the Web site maintained by
the SEC (www.sec.gov).

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 OBJECTIVES OF THE FUNDS

AMERICAN CENTURY -- TWENTIETH CENTURY
INTERNATIONAL GROWTH FUND

The investment objective of International Growth (formerly International
Equity) is capital growth. The fund will seek to achieve its investment
objective by investing primarily in an internationally diversified portfolio of
equity securities that are considered by the investment manager to have
prospects for appreciation. The fund will invest primarily in securities of
issuers in developed markets.

AMERICAN CENTURY -- TWENTIETH CENTURY
INTERNATIONAL DISCOVERY FUND

The investment objective of International Discovery (formerly International
Emerging Growth) is capital growth. The fund will seek to achieve its investment
objective by investing primarily in an internationally diversified portfolio of
equity securities of issuers having comparatively smaller market capitalizations
(less than U.S. $1 billion in market capitalization or less than U.S. $500
million in public float). The fund may invest up to 50% of its assets in
securities of issuers in emerging market countries. All such investments will be
considered by the investment manager to have prospects for appreciation. Due to
the risks associated with such investments, an investment in this fund may be
considered speculative.

SHARES OF THE FUND EXCHANGED OR REDEEMED WITHIN 180 DAYS OF THEIR PURCHASE
ARE SUBJECT TO A REDEMPTION FEE OF 2.0% OF THE VALUE OF THE SHARES EXCHANGED OR
REDEEMED. This redemption fee is retained by the fund and is intended to
discourage shareholders from exchanging or redeeming their shares shortly after
their purchase, as well as minimize the impact such exchanges and redemptions
have on fund performance and, hence, on the other shareholders of the fund.

There is no assurance that the funds will achieve their respective investment
objectives.

NO PERSON IS AUTHORIZED BY THE FUNDS 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 FUNDS, AND YOU SHOULD NOT RELY
ON ANY OTHER INFORMATION OR REPRESENTATION.

2 Investment Objectives American Century Investments

TABLE OF CONTENTS

Transaction and Operating Expense Table ..................................4
Financial Highlights .....................................................5

INFORMATION REGARDING THE FUNDS

Investment Policies of the Funds .........................................7
International Growth ..................................................7
International Discovery ...............................................7
Policies Applicable to Both Funds .....................................8
Risk Factors .............................................................9
Investing in Foreign Securities Generally .............................9
Speculative Nature of International Discovery ........................10
Investing in Emerging Market Countries ...............................10
Investing in Smaller Companies .......................................11
Investing in Lower Quality Debt Instruments ..........................11
Other Investment Practices, Their Characteristics and Risks .............11
Forward Currency Exchange Contracts ..................................11
Indirect Foreign Investment ..........................................12
Sovereign Debt Obligations ...........................................12
Portfolio Turnover ...................................................12
Repurchase Agreements ................................................13
When-Issued Securities ...............................................13
Short Sales ..........................................................13
Rule 144A Securities .................................................13
Performance Advertising .................................................14

HOW TO INVEST WITH AMERICAN CENTURY INVESTMENTS

American Century Investments ............................................15
Investing in American Century ...........................................15
How to Open an Account ..................................................15
By Mail ............................................................15
By Wire ............................................................15
By Exchange ........................................................15
In Person ..........................................................15
Subsequent Investments ...............................................16
By Mail ............................................................16
By Telephone .......................................................16
By Wire ............................................................16
In Person ..........................................................16
Automatic Investment Plan ............................................16
Minimum Investment ......................................................16
How to Exchange from One Account to Another .............................16
By Mail ............................................................17
By Telephone .......................................................17
How to Redeem Shares ....................................................17
By Mail ............................................................17
By Telephone .......................................................17
By Check-A-Month ...................................................17
Other Automatic Redemptions ........................................17
Redemption Proceeds ..................................................17
By Check ...........................................................18
By Wire and ACH ....................................................18
Special Requirements for Large Redemptions ...........................18
Signature Guarantee .....................................................18
Special Shareholder Services ............................................18
Open Order Service .................................................18
Tax-Qualified Retirement Plans .....................................19
Important Policies Regarding Your Investments ...........................19
Reports to Shareholders .................................................20
Customers of Banks, Broker-Dealers and Other Financial Intermediaries ...20

ADDITIONAL INFORMATION YOU SHOULD KNOW

Share Price .............................................................21
When Share Price Is Determined .......................................21
How Share Price Is Determined ........................................21
Where to Find Information About Share Price ..........................22
Distributions ...........................................................22
Taxes ...................................................................22
Tax-Deferred Accounts ................................................22
Taxable Accounts .....................................................22
Management ..............................................................24
Investment Management ................................................24
Code of Ethics .......................................................25
Transfer and Administrative Services .................................25
Distribution of Fund Shares .............................................25
Further Information About American Century ..............................26

Prospectus Table of Contents 3

<TABLE>
<CAPTION>
TRANSACTION AND OPERATING EXPENSE TABLE

International International
Growth Discovery

SHAREHOLDER TRANSACTION EXPENSES:

<S> <C> <C>
Maximum Sales Load Imposed on Purchases ............................ none none
Maximum Sales Load Imposed on Reinvested Dividends ................. none none
Deferred Sales Load ................................................ none none
Redemption Fee ..................................................... none none(1)
Exchange Fee ....................................................... none none

ANNUAL FUND OPERATING EXPENSES (as a percentage of net assets):

Management Fees(3) ................................................. 1.25% (2) 1.55%(2)
12b-1 Fees ......................................................... none none
Other Expenses(4) .................................................. 0.00% 0.00%
Total Fund Operating Expenses(3) ................................... 1.25% (2) 1.55%(2)

EXAMPLE:

You would pay the following expenses on a 1 year $ 13 $ 16
$1,000 investment, assuming a 5% annual return and 3 years 39 49
redemption at the end of each time period(3): 5 years 68 84
10 years 150 183
</TABLE>

(1) Shares of International Discovery exchanged or redeemed within 180 days of
their purchase are subject to a redemption fee of 2.0% of the value of the
shares exchanged or redeemed. This redemption fee is retained by the fund.
(See "How to Exchange from One Account to Another," page 16 and "How to
Redeem Shares," page 17.)

(2) International Growth pays an annual management fee of 1.30% of the first $1
billion of average net assets, 1.00% of the next $1 billion of average net
assets, and 0.90% of average net assets over $2 billion, and International
Discovery pays an annual management fee of 1.55% of the first $500 million
of average net assets, 1.20% of the next $500 million average net assets,
and 1.00% of average net assets over $1 billion.

(3) Assumes, in accordance with Securities and Exchange Commission guidelines,
that the assets of International Growth and International Discovery remain
constant at $1,210,441,553 and $114,579,142, respectively, the assets of
the funds as of November 30, 1995, and that the management fees for
International Growth and International Discovery had been in effect
throughout the periods indicated.

(4) Other expenses, the fees and expenses of those directors who are not
"interested persons" as defined in the Investment Company Act, were .001 of
1% of average net assets for the most recent fiscal year.

The purpose of the table is to help you understand the various costs and
expenses that you, as a shareholder, will bear directly or indirectly in
connection with an investment in the class of shares of the funds offered by
this Prospectus. The example set forth above assumes reinvestment of all
dividends and distributions and uses a 5% annual rate of return as required by
Securities and Exchange Commission regulations.

NEITHER THE 5% RATE OF RETURN NOR THE EXPENSES SHOWN ABOVE SHOULD BE
CONSIDERED INDICATIONS OF PAST OR FUTURE RETURNS AND EXPENSES. ACTUAL RETURNS
AND EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.

The shares offered by this Prospectus are Institutional Class shares. The
funds offer three other classes of shares, one of which is primarily made
available to retail investors and two that are primarily made available to
institutional investors. The other classes have different fee structures than
the Institutional Class, resulting in different performance for those classes.
For additional information about the various classes, see "Further Information
About American Century," page 26.

4 Transaction and Operating Expense Table American Century Investments

<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS

INTERNATIONAL GROWTH

The Institutional Class of the fund was established September 3, 1996. The
financial information in this table regarding selected per share data for the
fund reflects the performance of the fund's Investor Class of shares, which has
a total expense ratio that is 0.20% higher than the Institutional Class. Had the
Institutional Class been in existence for the fund for the time periods
presented, the fund's performance information would be higher as a result of the
lower expenses.

The Financial Highlights for each of the periods presented have been
audited by Baird, Kurtz & Dobson, independent certified public accountants,
whose report thereon appears in the funds' annual report, which is incorporated
by reference into the Statement of Additional Information. The semiannual and
annual reports contain additional performance information and will be made
available upon request and without charge. The information presented is for a
share outstanding throughout the years ended November 30, except as noted.

1995 1994 1993 1992 1991(1)

PER-SHARE DATA

<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ................................ $7.47 $7.34 $5.79 $5.33 $5.10
------- ------- ------- ------- -------
Income from Investment Operations

Net Investment Income (Loss)(2) ................................ .01 (.04) (.04) .06 .01

Net Realized and Unrealized Gains on Investments
and Foreign Currency Transactions ........................... .40 .57 1.78 .41 .22
------- ------- ------- ------- -------
Total from Investment Operations ............................... .41 .53 1.74 .47 .23
------- ------- ------- ------- -------
Distributions

From Net Investment Income ..................................... -- -- (.036) (.005) --

In Excess of Net Investment Income ............................. -- -- (.155) (.002) --

From Net Realized Gains on Investment Transactions ............. (.372) (.402) -- -- --
------- ------- ------- ------- -------
Total Distributions ............................................ (.372) (.402) (.191) (.007) --
------- ------- ------- ------- -------
Net Asset Value, End of Period ...................................... $7.51 $7.47 $7.34 $5.79 $5.33
======= ======= ======= ======= =======
Total Return(3) ................................................ 5.93% 7.28% 31.04% 8.77% 4.51%

RATIOS/SUPPLEMENTAL DATA

Ratio of Operating Expenses to Average Net Assets ................... 1.77% 1.84% 1.90% 1.91% 1.93% (4)

Ratio of Net Investment Income (Loss) to Average Net Assets ......... .25% (.53)% (.34)% 95% .26% (4)

Portfolio Turnover Rate ............................................. 169% 242% 255% 180% 84%

Average Commission Paid per Investment Security Traded .............. $.002 --(5) --(5) --(5) --(5)

Net Assets, End of Period (in thousands) ......................... $1,210,442 $1,316,642 $759,238 $215,346 $43,076
</TABLE>

(1) May 9, 1991, (inception) through November 30, 1991.

(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) Not computed for period indicated.

Prospectus Financial Highlights 5

<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS

INTERNATIONAL DISCOVERY

1995 1994 (1)

PER-SHARE DATA
<S> <C> <C>
Net Asset Value, Beginning of Period ................................... $5.39 $5.00
------- -------
Income from Investment Operations

Net Investment Income (Loss)(2) ................................... .03 (.02)

Net Realized and Unrealized Gains on Investments and .............. .28 .41
Foreign Currency Transactions
------- -------
Total from Investment Operations .................................. .31 .39
------- -------
Net Asset Value, End of Period ......................................... $5.70 $5.39

Total Return(3) ................................................... 5.75% 7.80%
======= =======
RATIOS/SUPPLEMENTAL DATA

Ratio of Operating Expenses to Average Net Assets ...................... 2.00% 2.00% (4)

Ratio of Net Investment Income (Loss) to Average Net Assets ............ .27% (.48)% (4)

Portfolio Turnover Rate ................................................ 168% 56%

Average Commission Paid per Investment Security Traded ................. $.004 --(5)

Net Assets, End of Period (in thousands) ...............................$114,579 $111,201
</TABLE>

(1) April 1, 1994, (inception) through November 30, 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) Not computed for period indicated.

6 Financial Highlights American Century Investments

INFORMATION REGARDING THE FUNDS

INVESTMENT POLICIES OF THE FUNDS

The funds have adopted certain investment restrictions that are set forth
in the Statement of Additional Information. Those restrictions, as well as the
investment objectives of the funds as listed 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 funds have implemented additional investment policies
and practices to guide their activities in the pursuit of their respective
investment objectives. These policies and practices, which are described
throughout this Prospectus, are not designated as fundamental policies and may
be changed without shareholder approval.

YOU SHOULD READ AND CAREFULLY CONSIDER THE INFORMATION UNDER "RISK
FACTORS," PAGE 9, BEFORE MAKING AN INVESTMENT IN EITHER FUND.

INTERNATIONAL GROWTH

The investment objective of International Growth is capital growth. The
fund will seek to achieve its investment objective by investing primarily in
securities of foreign issuers that meet certain fundamental and technical
standards of selection (relating primarily to acceleration of earnings and
revenues) and have, in the opinion of the manager, potential for appreciation.
The fund will invest primarily in issuers in developed markets. The fund will
invest primarily in equity securities (defined to include equity equivalents) of
such issuers. The fund will attempt to stay fully invested in such securities,
regardless of the movement of stock prices generally.

Although the primary investment of the fund will be equity securities, 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 return potential of other securities equals or exceeds the potential
return of equity securities, the fund may invest up to 35% in such other
securities.

The other securities the fund may invest in are 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 Investors Service, Inc. or
BBB or better by Standard & Poor's Corporation, 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 is the case with higher
quality debt securities. See "An Explanation of Fixed Income Securities Ratings"
in the Statement of Additional Information.

INTERNATIONAL DISCOVERY

The investment objective of International Discovery is capital growth. The
fund will seek to achieve its investment objective by investing primarily in an
internationally diversified portfolio of equity securities of issuers that meet
certain fundamental and technical standards of selection (relating primarily to
acceleration of earnings and revenues). The fund will invest its assets
primarily in equity securities of smaller foreign issuers (those issuers having,
at the time of investment, a market capitalization of less than U.S. $1 billion
or a public float of less than U.S. $500 million). The "public float" of an
issuer is defined as the aggregate market value of the issuer's outstanding
securities held by non-affiliates of the issuer. The fund may invest up to 50%
of its assets in securities of issuers in emerging market countries.

The manager will purchase securities of issuers that have, in the opinion
of the manager, significant growth potential. The fund will seek to invest in
securities of issuers with one or more identifiable catalysts that, in the
opinion of the manager, are likely to cause the issuer to experience
accelerating growth. Such catalysts

Prospectus Information Regarding the Funds 7

may include a change in the issuer's operating environment, the development of a
significant or potentially significant new product, service or technology, an
improvement in business outlook for the issuer, or other similar factors.

As noted, the fund may invest in smaller foreign issuers in both (i)
countries characterized as having developed markets and in (ii) countries
characterized as having emerging markets. DUE TO THE SIGNIFICANT RISKS
ASSOCIATED WITH THE FUND'S INVESTMENT STRATEGY, AN INVESTMENT IN THE FUND MAY BE
CONSIDERED TO BE SPECULATIVE. See "Speculative Nature of International
Discovery," page 10.

The fund may invest in securities of any type of issuer, including
closed-end investment companies, governments and governmental entities, as well
as corporations, partnerships and other business organizations. The manager
believes that common stocks and other equity and equity equivalent securities
ordinarily offer the greatest potential for capital appreciation and will
constitute the majority of the fund's investments. The fund may invest, however,
in any security the manager believes has the potential for capital appreciation.
The other securities the fund may invest in include bonds, notes and debt
securities of companies and obligations of domestic or foreign governments and
their agencies. The fund will attempt to stay fully invested in appreciating
securities, regardless of the movement of stock and bond prices generally.

There are no credit quality or maturity restrictions with regard to the
bonds, corporate debt securities, and government obligations in which the fund
may invest, although less than 35% of the fund's assets will be invested in
below investment grade fixed income securities. See "An Explanation of Fixed
Income Securities Ratings" in the Statement of Additional Information. Debt
securities, especially those of issuers in emerging market countries, may be of
poor quality and speculative in nature. While these securities will primarily be
chosen for their appreciation potential, the fund may also take the potential
for income into account when selecting investments.

To enhance the fund's liquidity, at least 50% of the fund's assets will be
invested in developed market countries at all times. However, the percentage of
the assets of the fund invested in developed and emerging markets will vary as,
in the opinion of the manager, market conditions warrant. No more than 15% of
the fund's assets may be invested in illiquid investments at any time.

POLICIES APPLICABLE TO BOTH FUNDS

The funds may make foreign investments either directly in foreign
securities, or indirectly by purchasing depositary receipts or depositary shares
or similar instruments ("DRs") for foreign securities. DRs are securities that
are listed on exchanges or quoted in over-the-counter markets in one country but
represent shares of issuers domiciled in another country. The funds may also
purchase securities of such issuers in foreign markets, either on foreign
securities exchanges or in the over-the-counter markets.

The funds may also invest in other equity securities and equity
equivalents. Other equity securities and equity equivalents include securities
that permit the funds 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 other equity securities
and equity equivalents are preferred stock, convertible preferred stock and
convertible debt securities. Equity equivalents may also include securities
whose value or return is derived from the value or return of a different
security. An example of one type of derivative security in which the funds might
invest is a depositary receipt.

Notwithstanding the funds' respective investment objectives of capital
growth, under exceptional market or economic conditions, each 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 a fund assumes a defensive position, it will not be pursuing
its investment objective of capital growth.

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

8 Information Regarding the Funds American Century Investments

interest rates rise, bond prices generally 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 that fund's shares. See "How
Share Price is Determined," page 21.

Under normal conditions, each fund will invest at least 65% of its assets
in equity and equity equivalent securities 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 in a fund across a broad range of foreign
issuers. The manager 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, and/or whose principal
trading market is outside the United States.

In order to achieve maximum investment flexibility, the funds have 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 in developed markets (such as Germany, the United Kingdom
and Japan) and in issuers in emerging market countries.

The funds consider "emerging market countries" to include all countries
that are generally considered to be developing or emerging countries by the
International Bank for Reconstruction and Development (commonly referred to as
the World Bank) and the International Finance Corporation (IFC), as well as
countries that are classified by the United Nations as developing. Currently,
the countries not included in this category are the United States, Canada,
Japan, the United Kingdom, Germany, Austria, France, Italy, Ireland, Spain,
Belgium, the Netherlands, Switzerland, Sweden, Finland, Norway, Denmark,
Australia and New Zealand. In addition, as used in this Prospectus, "securities
of issuers in emerging market countries" means (i) securities of issuers the
principal securities trading market for which is an emerging market country,
(ii) securities, regardless of where traded, of issuers that derive 50% or more
of their total revenue from either goods or services produced in emerging market
countries or sales made in emerging market countries, or (iii) securities of
issuers having their principal place of business or principal office in emerging
market countries.

The principal criteria for inclusion of a security in a fund's portfolio is
its ability to meet the fundamental and technical standards of selection and, in
the opinion of the manager, to achieve better-than-average appreciation. If, in
the opinion of the manager, a particular security satisfies these principal
criteria, 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 (subject to the investment policies of the particular fund) or
region.

At the same time, however, the manager recognizes that both the selection
of a fund's individual securities and the allocation of the portfolio's assets
across different countries and regions are important factors in managing an
international portfolio. For this reason, the manager will also 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 FOREIGN SECURITIES GENERALLY

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 funds can decrease as well as
increase, depending upon a variety of factors which may affect the values and
income generated by the funds' portfolio securities. Investments in the funds
should not be considered a complete investment program and may not be
appropriate for an individual with limited investment resources or who is unable
to tolerate fluctuations in the value of the investment. Potential investors
should carefully consider the following factors:

Currency Risk. The value of the foreign investments held by the funds 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

Prospectus Information Regarding the Funds 9

such currency. In addition, the value of fund 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 funds invest are not as developed as the economy of the United States
and may be subject to significantly different forces. Political or social
instability, expropriation, nationalization, or confiscatory taxation, and
limitations on the removal of funds or other assets, could also adversely affect
the value of investments. Further, the funds may encounter difficulties or be
unable to pursue legal remedies or obtain judgments in foreign courts.

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 funds may be reduced by a withholding tax at the
source which would reduce dividend income payable to shareholders. See "Taxes,"
page 22.

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

SPECULATIVE NATURE OF INTERNATIONAL DISCOVERY

In addition to the risks posed by foreign investing generally,
International Discovery will be investing in the securities of companies having
comparatively small market capitalizations and may invest up to 50% of its
assets in issuers in emerging market countries. See "Investing in Emerging
Market Countries," this page and "Investing in Smaller Companies," page 11. As a
result, an investment in the fund should be considered to be speculative. The
fund is intended for aggressive investors seeking significant gains through
investments in foreign securities. Those investors must be willing and able to
accept the significantly greater risks associated with the investment strategy
that International Discovery will pursue. An investment in the fund should not
be considered a complete investment program and is not appropriate for
individuals with limited investment resources or who are unable to tolerate
fluctuations in the value of their investment.

INVESTING IN EMERGING MARKET COUNTRIES

Each fund included in this Prospectus may invest in securities of issuers
in emerging market countries. Investing in emerging market countries involves
exposure to significantly higher risk than investing in countries with developed
markets. Emerging market countries may have economic structures that are
generally less diverse and mature and political systems that can be expected to
be less stable than those of developed countries.

Securities prices in emerging market countries can be significantly more
volatile than in developed countries, reflecting the greater uncertainties of
investing in lesser developed markets and economies. In particular, emerging
market countries may have relatively unstable governments, and may present the
risk of nationalization of businesses, expropriation, confiscatory taxation or,
in certain instances, reversion to closed market, centrally planned economies.
Such countries may also have restrictions on foreign ownership or prohibitions
on the repatriation of assets, and may have less protection of property rights
than developed countries.

The economies of emerging market countries may be predominantly based on
only a few industries or dependent on revenues from particular commodities

10 Information Regarding the Funds American Century Investments

or on international aid or development assistance, may be highly vulnerable to
changes in local or global trade conditions, and may suffer from extreme and
volatile debt burdens or inflation rates. In addition, securities markets in
emerging market countries may trade a small number of securities and may be
unable to respond effectively to increases in trading volume, potentially
resulting in a lack of liquidity and greater volatility in the price of
securities traded on those markets.

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 funds are uninvested and no
return is earned thereon. The inability of the funds to make intended security
purchases due to clearance and settlement problems could cause the funds to miss
attractive investment opportunities. Inability to dispose of portfolio
securities due to clearance and settlement problems could result either in
losses to the funds 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.

INVESTING IN SMALLER COMPANIES

International Discovery will invest primarily in securities of companies
having, at the time of investment, a market capitalization of less than U.S. $1
billion or a public float of less than U.S. $500 million. These smaller
companies may present greater opportunities for capital appreciation, but may
also involve greater risks than large, mature issuers. Such companies may have
limited product lines, markets or financial resources, and their securities may
trade less frequently and in more limited volume than the securities of larger
companies. In addition, available information regarding these smaller companies
may be less available and, when available, may be incomplete or inaccurate. The
securities of such companies may also be more likely to be delisted from trading
on their primary domestic exchange. As a result, the securities of smaller
companies may experience significantly more price volatility and less liquidity
than securities of larger companies, and this volatility and limited liquidity
may be reflected in the net asset value of the fund.

INVESTING IN LOWER QUALITY DEBT INSTRUMENTS

There are no credit, maturity or investment amount restrictions on the
bonds, corporate debt securities, and government obligations in which
International Discovery may invest. Debt securities, especially those in
emerging market countries, may be of poor quality, unrated and speculative in
nature. Debt securities rated lower than Baa by Moody's or BBB by S&P or their
equivalent, sometimes referred to as junk bonds, are considered by many to be
predominately speculative. See "An Explanation of Fixed Income Securities
Ratings" in the Statement of Additional Information. Changes in economic
conditions or other circumstances are more likely to lead to a weakened capacity
to make principal and interest payments on such securities than is the case with
higher quality debt securities. Regardless of rating levels, all debt securities
considered for purchase by the fund are analyzed by the manager to determine, to
the extent reasonably possible, that the planned investment is sound given the
investment objective of the fund.

OTHER INVESTMENT PRACTICES, THEIR CHARACTERISTICS
AND RISKS

For additional information, see "Investment Restrictions" in the Statement
of Additional Information.

FORWARD CURRENCY EXCHANGE CONTRACTS

Some of the securities held by the funds will be denominated in foreign
currencies. Other securities, such as DRs, may be denominated in 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 a
fund's portfolio may be affected by changes in the exchange rates between
foreign currencies and the U.S. dollar, as well as by changes in the market
values 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 a fund.

Prospectus Information Regarding the Funds 11

To protect against adverse movements in exchange rates between currencies,
a 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.

A 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, a
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." Each 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, a fund may enter into a foreign currency exchange
contract to sell an amount of foreign currency equal to 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." A 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.

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

If a 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.

Predicting the relative future values of currencies is very difficult, and
there is no assurance that any attempt to reduce the risk of 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.

INDIRECT FOREIGN INVESTMENT

Subject to certain restrictions contained in the Investment Company Act,
each fund may invest up to 10% of its assets in certain foreign countries
indirectly through investment funds and registered investment companies
authorized to invest in those countries. If the funds invest in investment
companies, the funds will bear their proportionate shares of the costs incurred
by such companies, including investment advisory fees, if any.

SOVEREIGN DEBT OBLIGATIONS

The funds may purchase sovereign debt instruments issued or guaranteed by
foreign governments or their agencies, including debt of emerging market
countries. Sovereign debt may be in the form of conventional securities or other
types of debt instruments such as loans or loan participations. Sovereign debt
of emerging market countries may involve a high degree of risk and may present a
risk of default or renegotiation or rescheduling of debt payments.

PORTFOLIO TURNOVER

The portfolio turnover rates of the funds are shown in the Financial
Highlights table on pages 5 and 6 of this Prospectus.

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

The portfolio turnover of each fund may be higher than other mutual funds
with similar investment objectives. Higher turnover would generate

12 Information Regarding the Funds American Century Investments

correspondingly greater brokerage commissions, which is a cost that the funds
pay directly. Portfolio turnover may also affect the character of capital gains,
if any, realized and distributed by a fund since short-term capital gains are
taxable as ordinary income.

REPURCHASE AGREEMENTS

Each 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 policies of that 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.

Since the security purchased constitutes security for the repurchase
obligation, a repurchase agreement can be considered as 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 funds will limit repurchase agreement transactions to securities issued
by the U.S. government, its agencies and instrumentalities, and will enter into
such transactions with those commercial banks and broker-dealers who are deemed
creditworthy pursuant to criteria adopted by the funds' Board of Directors.

The funds will not invest more than 15% of their respective assets in
repurchase agreements maturing in more than seven days.

WHEN-ISSUED SECURITIES

Each 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 objectives of the fund. The price of when-issued
securities is established at the time the commitment to purchase is made. In
developed markets, delivery of and payment for these securities typically occur
15 to 45 days after the commitment to purchase. In emerging markets, delivery
and payment make take significantly longer.

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 for each fund 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

Each 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. These transactions allow a fund to hedge against
price fluctuations by locking in a sale price for securities it does not wish to
sell immediately.

A 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.

RULE 144A SECURITIES

The funds may invest up to 15% of their respective 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), including
restricted securities. Although securities which may be resold only to qualified
institutional investors in accordance with the provisions of Rule 144A under the
Securities Act of 1933 are considered "restricted securities," each fund may
purchase Rule 144A securities without regard to the percentage limitations
described above when Rule 144A securities present an attractive investment
opportunity and otherwise meet the fund's criteria of selection, and also meet
the liquidity guidelines established for Rule 144A securities.

Prospectus Information Regarding the Funds 13

With respect to securities eligible for resale under Rule 144A, the staff
of the Securities and Exchange Commission 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. 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 Board of Directors of the funds have 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.

Since the secondary market for such securities will be limited to certain
qualified institutional investors, their liquidity 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 manager will consider appropriate remedies to minimize the
effect on the fund's liquidity.

PERFORMANCE ADVERTISING

From time to time, the funds may advertise performance data. Fund
performance may be shown by presenting one or more performance measurements,
including cumulative total return or average annual total return. Performance
data may be quoted separately for the Institutional Class and the other classes
offered by the funds.

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.

Each 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) and publications that monitor the performance of
mutual funds. Performance information may be quoted numerically or may be
presented in a table, graph or other illustration. Fund performance may also be
compared to well-known indices of market performance, such as the Standard &
Poor's 500 Index, the Dow Jones World Index, the IFC Global Composite Index and
the Morgan Stanley Capital International Europe, Australia, Far East Index (EAFE
Index). Fund performance may also be compared to the rankings prepared by Lipper
Analytical Services, Inc. In addition, fund performance may be compared, on a
relative basis, to other funds in our fund family. This relative comparison,
which may be based upon historical or expected fund performance, volatility or
other fund characteristics, may be presented numerically, graphically or in
text. Fund performance may also be combined or blended with other funds in our
fund family, and that combined or blended performance may be compared to the
same indices to which individual funds may be compared.

All performance information advertised by the funds 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.

14 Information Regarding the Funds American Century Investments

HOW TO INVEST WITH
AMERICAN CENTURY INVESTMENTS

AMERICAN CENTURY INVESTMENTS

The funds offered by this Prospectus are a part of the American Century
Investments family of mutual funds. Our family provides a full range of
investment opportunities, from the aggressive equity growth funds in our
Twentieth Century Group, to the fixed income funds in our Benham Group, to the
moderate risk and specialty funds in our American Century Group. Please call
1-800-345-3533 for a brochure or prospectuses for the other funds in the
American Century Investments family.

INVESTING IN AMERICAN CENTURY

The following section explains how to invest with American Century funds,
including purchases, redemptions, exchanges and special services. You will find
more detail about doing business with us by referring to the Investor Services
Guide that you will receive when you open an account.

If you own or are considering purchasing fund shares through a bank,
broker-dealer or other financial intermediary, the following sections as well as
the information contained in our Investor Services Guide, may not apply to you.
Please read "Minimum Investments," page 16 and"Customers of Banks,
Broker-Dealers and Other Financial Intermediaries," page 20.

HOW TO OPEN AN ACCOUNT

To open an account, you must complete and sign an application, furnishing
your taxpayer identification number. (You must also certify whether you are
subject to withholding for failing to report income to the IRS.) Investments
received without a certified taxpayer identification number will be returned.

You may invest in the following ways:

BY MAIL

Send a completed application and check or money order payable in U.S.
dollars to American Century Investments.

BY WIRE

You may make your initial investment by wiring funds. To do so, call us or
mail a completed application and provide your bank with the following
information:

o RECEIVING BANK AND ROUTING NUMBER:
Commerce Bank, N.A. (101000019)

o BENEFICIARY (BNF):
American Century Services Corporation
4500 Main St., Kansas City, Missouri 64141-6200

o BENEFICIARY ACCOUNT NUMBER (BNF ACCT):
2804918

o REFERENCE FOR BENEFICIARY (RFB):
American Century account number into which you are investing. If more than
one, leave blank and see Bank to Bank Information below.

o ORIGINATOR TO BENEFICIARY (OBI):
Name and address of owner of account into which you are investing.

o BANK TO BANK INFORMATION
(BBI OR FREE FORM TEXT):

o Taxpayer identification or social security number.

o If more than one account, account numbers and amount to be invested in
each account.

o Current tax year, previous tax year or rollover designation if an IRA.
Specify whether IRA, SEP-IRA or SARSEP-IRA.

BY EXCHANGE

Call 1-800-345-3533 from 7 a.m. to 7 p.m. Central time to get information
on opening an account by exchanging from another American Century account. See
page 16 for more information on exchanges.

IN PERSON

If you prefer to work with a representative in person, please visit one of
our Investors Centers, located at:

4500 Main Street
Kansas City, Missouri 64111

Prospectus How to Invest with American Century Investments 15

1665 Charleston Road
Mountain View, California 94043

2000 S. Colorado Blvd.
Denver, Colorado 80222

SUBSEQUENT INVESTMENTS

Subsequent investments may be made by an automatic bank, payroll or
government direct deposit (see "Automatic Investment Plan," this page) or by any
of the methods below. The minimum investment requirement for subsequent
investments: $250 for checks submitted without the remittance portion of a
previous statement or confirmation, $50 for all other types of subsequent
investments.

BY MAIL

When making subsequent investments, enclose your check with the remittance
portion of the confirmation of a previous investment. If the investment slip is
not available, indicate your name, address and account number on your check or a
separate piece of paper. (Please be aware that the investment minimum for
subsequent investments is higher without an investment slip.)

BY TELEPHONE

Once your account is open, you may make investments by telephone if you
have authorized us (by choosing "Full Services" on your application) to draw on
your bank account. You may call an Institutional Service Representative.

BY WIRE

You may make subsequent investments by wire. Follow the wire transfer
instructions on page 15 and indicate your account number.

IN PERSON

You may make subsequent investments in person at one of our Investors
Centers. The locations of our three Investors Centers are listed on pages 15 and
16.

AUTOMATIC INVESTMENT PLAN

You may elect on your application to make investments automatically by
authorizing us to draw on your bank account regularly. Such investments must be
at least the equivalent of $50 per month. You also may choose an automatic
payroll or government direct deposit. If you are establishing a new account,
check the appropriate box under "Automatic Investments" on your application to
receive more information. If you would like to add a direct deposit to an
existing account, please call one of our Institutional Service Representatives.

MINIMUM INVESTMENT

The minimum investment is $5 million ($3 million for endowments and
foundations). If you invest with us through a bank, broker-dealer or other
financial intermediary, the minimum investment requirement may be met by
aggregating the investments of various clients of your financial intermediary.
The minimum investment requirement may be waived if you or your financial
intermediary, if applicable, has an aggregate investment in our family of funds
of $10 million or more ($5 million for endowments and foundations). If your
balance or the balance of your financial intermediary, if applicable, falls
below the minimum investment requirements due to redemptions or exchanges, we
reserve the right to convert your shares to Investor Class shares of the same
fund. The Investor Class shares have a unified management fee that is 0.20%
higher than the Institutional Class shares.

HOW TO EXCHANGE FROM ONE ACCOUNT TO ANOTHER

As long as you meet any minimum investment requirements, you may exchange
your fund shares to our other funds up to six times per year per account. An
exchange request will be processed the same day it is received, if it is
received before the funds' net asset values are calculated, which is one hour
prior to the close of the New York Stock Exchange for the American Century
Target Maturities Trust, and at the close of the Exchange for all of our other
funds. See "When Share Price is Determined," page 21.

For any single exchange, the shares of each fund being acquired must have a
value of at least $100. However, we will allow investors to set up an Automatic
Exchange Plan between any two funds in the amount of at least $50 per month. See
our Investor Services Guide for further information about exchanges.

If, in any 90-day period, the total of your exchanges and your redemptions
from any one account exceeds the lesser of $250,000 or 1% of the fund's assets,
further exchanges will be subject to special requirements

16 How to Invest with American Century Investments American Century Investments

to comply with our policy on large redemptions. See "Special Requirements for
Large Redemptions," page 18.

IN ORDER TO DISCOURAGE THE EXCHANGE OF SHARES OF INTERNATIONAL DISCOVERY
SHORTLY AFTER THEIR PURCHASE, EXCHANGE OF THOSE SHARES WITHIN 180 DAYS OF THEIR
PURCHASE WILL BE SUBJECT TO A REDEMPTION FEE OF 2.0% OF THE VALUE OF THE SHARES
EXCHANGED. This fee will be retained by the fund to help minimize the impact
such exchanges have of fund performance and, hence, on the other shareholders of
the fund. For the purposes of determining the applicability of this fee, shares
first purchased will be deemed to be the shares first exchanged. The funds
reserve the right to modify their policy regarding this redemption fee or to
waive such policy in whole or in part for certain classes of investors.

BY MAIL

You may direct us in writing to exchange your shares from one American
Century account to another. For additional information, please see our Investor
Services Guide.

BY TELEPHONE

You can make exchanges over the telephone if you have authorized us to
accept telephone instructions. You can authorize this by selecting "Full
Services" on your application or by calling one of our Institutional Service
Representatives at 1-800-345-3533 to get the appropriate form.

HOW TO REDEEM SHARES

We will redeem or "buy back" your shares at any time. Redemptions will be
made at the next net asset value determined after a complete redemption request
is received. For large redemptions, please read "Special Requirements for Large
Redemptions," page 18.

Please note that a request to redeem shares in an IRA or 403(b) plan must
be accompanied by an executed IRS Form W4-P and a reason for withdrawal as
specified by the IRS.

IN ORDER TO DISCOURAGE THE REDEMPTION OF SHARES OF INTERNATIONAL DISCOVERY
SHORTLY AFTER THEIR PURCHASE, REDEMPTION OF THOSE SHARES WITHIN 180 DAYS OF
THEIR PURCHASE WILL BE SUBJECT TO A REDEMPTION FEE OF 2.0% OF THE VALUE OF THE
SHARES REDEEMED. This fee will be retained by the fund to help minimize the
impact such redemptions have on fund performance and, hence, on the other
shareholders of the fund. For the purposes of determining the applicability of
this fee, shares first purchased will be deemed to be the shares first redeemed.
The funds reserve the right to modify their policy regarding this redemption fee
or to waive such policy in whole or in part for certain classes of investors.

BY MAIL

Your written instructions to redeem shares may be made either by a
redemption form, which we will send you upon request, or by a letter to us.
Certain redemptions may require a signature guarantee. Please see "Signature
Guarantee," page 18.

BY TELEPHONE

If you have authorized us to accept telephone instructions, you may redeem
your shares by calling an Institutional Service Representative.

BY CHECK-A-MONTH

You may redeem shares by Check-A-Month. A Check-A-Month plan automatically
redeems enough shares each month to provide you with a check in an amount you
choose (minimum $50). To set up a Check-A-Month plan, please call and request
our Check-A-Month brochure.

OTHER AUTOMATIC REDEMPTIONS

You may elect to make redemptions automatically by authorizing us to send
funds to you or your account at a bank or other financial institution. To set up
automatic redemptions, call one of our Institutional Service Representatives.

REDEMPTION PROCEEDS

Please note that shortly after a purchase of shares is made by check or
electronic draft (also known as an ACH draft) from your bank, we may wait up to
15 days or longer to send redemption proceeds (to allow your purchase funds to
clear). No interest is paid on the redemption proceeds after the redemption is
processed but before your redemption proceeds are sent.

Redemption proceeds may be sent to you in one of the following ways:

Prospectus How to Invest with American Century Investments 17

BY CHECK

Ordinarily, all redemption checks will be made payable to the registered
owner of the shares and will be mailed only to the address of record. For more
information, please refer to our Investor Services Guide.

BY WIRE AND ACH

You may authorize us to transmit redemption proceeds by wire or ACH. These
services will be effective 15 days after we receive the authorization.

Your bank will usually receive wired funds within 48 hours of transmission.
Funds transferred by ACH may be received up to seven days after transmission.
Once the funds are transmitted, the time of receipt and the funds' availability
are not under our control.

SPECIAL REQUIREMENTS FOR LARGE REDEMPTIONS

We have elected to be governed by Rule 18f-1 under the Investment Company
Act, which obligates each fund to make certain redemptions in cash. This
requirement to pay redemptions in cash applies to situations where one
shareholder redeems, during any 90-day period, up to the lesser of $250,000 or
1% of the assets of the fund. Although redemptions in excess of this limitation
will also normally be paid in cash, we reserve the right under unusual
circumstances to honor these redemptions by making payment in whole or in part
in readily marketable securities (a "redemption-in-kind").

If payment is made in securities, the securities will be selected by the
fund, will be valued in the same manner as they are in computing the fund's net
asset value and will be provided without prior notice.

If your redemption would exceed this limit and you would like to avoid
being paid in securities, please provide us with an unconditional instruction to
redeem at least 15 days prior to the date on which the redemption transaction is
to occur. The instruction must specify the dollar amount or number of shares to
be redeemed and the date of the transaction. This minimizes the effect of the
redemption on the fund and its remaining shareholders.

Despite its right to redeem fund shares through a redemption-in-kind, we do
not expect to exercise this option unless a fund has an unusually low level of
cash to meet redemptions and/or is experiencing unusually strong demands for its
cash. Such a demand might be caused, for example, by extreme market conditions
that result in an abnormally high level of redemption requests concentrated in a
short period of time. Absent these or similar circumstances, we expect
redemptions in excess of $250,000 to be paid in cash in any fund with assets of
more than $50 million if total redemptions from any one account in any 90-day
period do not exceed one-half of 1% of the total assets of the fund.

SIGNATURE GUARANTEE

To protect your accounts from fraud, some transactions will require a
signature guarantee. Which transactions will require a signature guarantee will
depend on which service options you elect when you open your account. For
example, if you choose "In Writing Only," a signature guarantee would be
required when:

o Redeeming more than $25,000; or

o Establishing or increasing a Check-A-Month or automatic transfer on an
existing account.

You can obtain a signature guarantee from a bank or trust company, credit
union, broker-dealer, securities exchange or association, clearing agency or
savings association, as defined by federal law.

For a more in-depth explanation of our signature guarantee policy, or if
you live outside the United States and would like to know how to obtain a
signature guarantee, please consult our Investor Services Guide.

We reserve the right to require a signature guarantee on any transaction,
or to change this policy at any time.

SPECIAL SHAREHOLDER SERVICES

We offer several service options to make your account easier to manage.
These are listed on the account application. Please make note of these options
and elect the ones that are appropriate for you. Be aware that the "Full
Services" option offers you the most flexibility. You will find more information
about each of these service options in our Investor Services Guide.

Our special shareholder services include:

OPEN ORDER SERVICE

Through our open order service, you may designate a price at which to buy
shares of a variable-priced

18 How to Invest with American Century Investments American Century Investments

fund by exchange from one of our money market funds, or a price at which to sell
shares of a variable-priced fund by exchange to one of our money market funds.
The designated purchase price must be equal to or lower, or the designated sale
price equal to or higher, than the variable-priced fund's net asset value at the
time the order is placed. If the designated price is met within 90 calendar
days, we will execute your exchange order automatically at that price (or
better). Open orders not executed within 90 days will be canceled.

If the fund you have selected deducts a distribution from its share price,
your order price will be adjusted accordingly so the distribution does not
inadvertently trigger an open order transaction on your behalf. If you close or
re-register the account from which the shares are to be redeemed, your open
order will be canceled.

Because of their time-sensitive nature, open order transactions are
accepted only by telephone or in person. These transactions are subject to
exchange limitations described in each fund's Prospectus, except that orders and
cancellations received before 2 p.m. Central time are effective the same day,
and orders or cancellations received after 2 p.m. Central time are effective the
next business day.

TAX-QUALIFIED RETIREMENT PLANS

Each fund is available for your tax-deferred retirement plan. Call or write
us and request the appropriate forms for:

o Individual Retirement Accounts (IRAs);

o 403(b) plans for employees of public school systems and nonprofit
organizations; or

o Profit sharing plans and pension plans for corporations and other
employers.

If your IRA and 403(b) accounts do not total $10,000, each account is
subject to an annual $10 fee, up to a total of $30 per year.

You can also transfer your tax-deferred plan to us from another company or
custodian. Call or write us for a Request to Transfer form.

IMPORTANT POLICIES REGARDING YOUR INVESTMENTS

Every account is subject to policies that could affect your investment.
Please refer to the Investor Services Guide for further information about the
policies discussed below, as well as further detail about the services we offer.

(1) We reserve the right for any reason to suspend the offering of shares for a
period of time, or to reject any specific purchase order (including
purchases by exchange). Additionally, purchases may be refused if, in the
opinion of the manager, they are of a size that would disrupt the
management of the fund.

(2) We reserve the right to make changes to any stated investment requirements,
including those that relate to purchases, transfers and redemptions. In
addition, we may also alter, add to or terminate any investor services and
privileges. Any changes may affect all shareholders or only certain series
or classes of shareholders.

(3) Shares being acquired must be qualified for sale in your state of
residence.

(4) Transactions requesting a specific price and date, other than open orders,
will be refused. Once you have mailed or otherwise transmitted your
transaction instructions to us, they may not be modified or canceled.

(5) If a transaction request is made by a corporation, partnership, trust,
fiduciary, agent or unincorporated association, we will require evidence
satisfactory to us of the authority of the individual making the request.

(6) We have established procedures designed to assure the authenticity of
instructions received by telephone. These procedures include requesting
personal identification from callers, recording telephone calls, and
providing written confirmations of telephone transactions. These procedures
are designed to protect shareholders from unauthorized or fraudulent
instructions. If we do not employ reasonable procedures to confirm the
genuineness of instructions, then we may be liable for losses due to
unauthorized or fraudulent instructions. The company, its transfer agent
and investment advisor will not be responsible for any loss due to
instructions they reasonably believe are genuine.

(7) All signatures should be exactly as the name appears in the registration.
If the owner's name appears in the registration as Mary Elizabeth

Prospectus How to Invest with American Century Investments 19

Jones, she should sign that way and not as Mary E. Jones.

(8) Unusual stock market conditions have in the past resulted in an increase in
the number of shareholder telephone calls. If you experience difficulty in
reaching us during such periods, you may send your transaction instructions
by mail, express mail or courier service, or you may visit one of our
Investors Centers. You may also use our Automated Information Line if you
have requested and received an access code and are not attempting to redeem
shares.

(9) If you fail to provide us with the correct certified taxpayer
identification number, we may reduce any redemption proceeds by $50 to
cover the penalty the IRS will impose on us for failure to report your
correct taxpayer identification number on information reports.

(10) We will perform special inquiries on shareholder accounts. A research fee
of $15 per hour may be applied.

REPORTS TO SHAREHOLDERS

At the end of each calendar quarter, we will send you a consolidated
statement that summarizes all of your American Century holdings, as well as an
individual statement for each fund you own that reflects all year-to-date
activity in your account. You may request a statement of your account activity
at any time.

With the exception of most automatic transactions, each time you invest,
redeem, transfer or exchange shares, we will send you a confirmation of the
transaction. See the Investor Services Guide for more detail.

Carefully review all the information relating to transactions on your
statements and confirmations to ensure that your instructions were acted on
properly. Please notify us immediately in writing if there is an error. If you
fail to provide notification of an error with reasonable promptness, i.e.,
within 30 days of non-automatic transactions or within 30 days of the date of
your consolidated quarterly statement, in the case of automatic transactions, we
will deem you to have ratified the transaction.

No later than January 31 of each year, we will send you reports that you
may use in completing your U.S. income tax return. See the Investor Services
Guide for more information.

Each year, we will send you an annual and a semiannual report relating to
your fund, each of which is incorporated herein by reference. The annual report
includes audited financial statements and a list of portfolio securities as of
the fiscal year end. The semiannual report includes unaudited financial
statements for the first six months of the fiscal year, as well as a list of
portfolio securities at the end of the period. You also will receive an updated
Prospectus at least once each year. Please read these materials carefully as
they will help you understand your fund.

CUSTOMERS OF BANKS, BROKER-DEALERS AND OTHER
FINANCIAL INTERMEDIARIES

Information contained in our Investor Services Guide pertains to
shareholders who invest directly with American Century rather than through a
bank, broker-dealer or other financial intermediary.

If you own or are considering purchasing fund shares through a bank,
broker-dealer or other financial intermediary, your ability to purchase,
exchange and redeem shares will depend on your agreement with, and the policies
of, such financial intermediary.

You may reach one of our Institutional Service Representatives by calling
1-800-345-3533 to request information about the funds and services, to obtain a
current Prospectus or to get answers to any questions about the funds that you
are unable to obtain through your plan administrator or financial intermediary.

20 How to Invest with American Century Investments American Century Investments

ADDITIONAL INFORMATION YOU SHOULD KNOW

SHARE PRICE

WHEN SHARE PRICE IS DETERMINED

The price of your 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. For all American Century funds, except the American Century Target
Maturities Trust, net asset value is determined at the close of regular trading
on each day that the New York Stock Exchange is open, usually 3 p.m. Central
time. Net asset value for the Target Maturities is determined one hour prior to
the close of the Exchange.

Investments and requests to redeem or exchange shares will receive the
share price next determined after we receive your investment, redemption or
exchange request. For example, investments and requests to redeem or exchange
shares of a fund received by us or one of our agents before the net asset value
of the fund is determined, are effective on, and will receive the price
determined, that day. Investment, redemption and exchange requests received
thereafter are effective on, and receive the price determined on, the next day
the Exchange is open.

Investments are considered received only when your check or wired funds are
received by us. Wired funds are considered received on the day they are
deposited in our bank account, if they are deposited before the net asset value
is determined.

Investments by telephone pursuant to your prior authorization to us to draw
on your bank account are considered received at the time of your telephone call.

Investment and transaction instructions received by us on any business day
by mail before the net asset value is determined, will receive that day's price.
Investments and instructions received after that time will receive the price
determined on the next business day.

If you invest in fund shares through a bank, financial advisor or other
financial intermediary, it is the responsibility of your financial intermediary
to transmit your purchase, exchange and redemption requests to the funds'
transfer agent prior to the applicable cut-off time and to make payment for any
purchase transactions in accordance with the funds' procedures or any
contractual arrangement with the funds or the funds' distributor in order for
you to receive that day's price.

HOW SHARE PRICE IS DETERMINED

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

Portfolio securities of each 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 are generally 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 on the New York Stock Exchange, if that
is earlier. That value is then converted to 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

Prospectus Additional Information You Should Know 21

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 which 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 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 a fund's portfolio may be significantly affected on
days when shares of the fund may not be purchased or redeemed.

WHERE TO FIND INFORMATION ABOUT SHARE PRICE

The net asset value of the Investor Class of each fund is published in
leading newspapers daily. The net asset value of the Institutional Class may be
obtained by calling us.

DISTRIBUTIONS

In general, distributions from net investment income and net realized
securities gains, if any, are declared and paid annually, usually in December,
but the funds 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.

THE OBJECTIVE OF EACH FUND IS CAPITAL APPRECIATION AND NOT THE PRODUCTION
OF DISTRIBUTIONS. YOU SHOULD MEASURE THE SUCCESS OF YOUR INVESTMENT BY THE VALUE
OF YOUR INVESTMENT AT ANY GIVEN TIME AND NOT BY THE DISTRIBUTIONS YOU RECEIVE.

For shareholders investing through taxable accounts, distributions will be
reinvested unless you elect to receive them in cash. Distributions of less than
$10 generally will be reinvested. Distributions made shortly after a purchase by
check or ACH may be held up to 15 days. You may elect to have distributions on
shares held in Individual Retirement Accounts and 403(b) plans paid in cash only
if you are at least 59 1/2 years old or permanently and totally disabled.
Distribution checks normally are mailed within seven days after the record date.
Please consult our Investor Services Guide for further information regarding
your distribution options.

A distribution on shares of a fund does not increase the value of your
shares or your total return. At any given time the value of your shares includes
the undistributed net gains, if any, realized by the fund on the sale of
portfolio securities, and undistributed dividends and interest received, less
fund expenses.

Because such gains and dividends are included in the price of your shares
prior to distribution, when they are distributed the value of your shares is
reduced by the amount of the distribution. If you buy your shares through a
taxable account just before the distribution, you will pay the full price for
your shares, and then receive a portion of the purchase price back as a taxable
distribution. See "Taxes," this page.

TAXES

Each fund has elected to be taxed as a regulated investment company under
Subchapter M of the Internal Revenue Code, which means that to the extent its
income is distributed to shareholders, it pays no income taxes.

TAX-DEFERRED ACCOUNTS

If fund shares are purchased through tax-deferred accounts, such as a
qualified employer-sponsored retirement or savings plan (excluding
participant-directed employer-sponsored retirement plans, which are ineligible
to invest in Institutional Class shares), income and capital gains distributions
paid by the funds will generally not be subject to current taxation, but will
accumulate in your account on a tax-deferred basis.

TAXABLE ACCOUNTS

If fund shares are purchased through taxable accounts, distributions of net
investment income and net short-term capital gains are taxable to you as
ordinary income. Distributions from net long-term capital gains are taxable as
long-term capital gains regardless of the length of time you have held the
shares on which such distributions are paid. However, you

22 Additional Information You Should Know American Century Investments

should note that any loss realized upon the sale or redemption of shares held
for six months or less will be treated as a long-term capital loss to the extent
of any distribution of long-term capital gain to you with respect to such
shares.

Dividends and interest received by a fund on foreign securities, as well as
capital gains realized upon the sale of such securities, may give rise to
withholding and other taxes imposed by foreign countries. Tax conventions
between certain countries and the United States may reduce or eliminate such
taxes. The foreign taxes paid by a fund will reduce its dividends.

If more than 50% of the value of a fund's total assets at the close of the
taxable year consist of securities of foreign corporations, the fund may qualify
for and make an election with the Internal Revenue Service with respect to such
fiscal year so that fund shareholders may be able to claim a foreign tax credit
in lieu of a deduction for foreign income taxes paid by the fund. If such an
election is made, the foreign taxes paid by the fund will be treated as income
received by you.

If a fund purchases the securities of certain foreign investment funds or
trusts called passive foreign investment companies, capital gains on the sale of
such holdings will be deemed to be ordinary income regardless of how long the
fund holds its investment. The fund may also be subject to corporate income tax
and an interest charge on certain dividends and capital gains earned from these
investments, regardless of whether such income and gains are distributed to
shareholders. In the alternative, the fund may elect to recognize cumulative
gains on such investments as of the last day of its fiscal year and distribute
it to shareholders.

Distributions are taxable to you regardless of whether they are taken in
cash or reinvested, even if the value of your shares is below your cost. If you
purchase shares shortly before a distribution, you must pay income taxes on the
distribution, even though the value of your investment (plus cash received, if
any) remains the same. In addition, the share price at the time you purchase
shares may include unrealized gains in the securities held in the investment
portfolio of a fund. If these portfolio securities are subsequently sold and the
gains are realized, they will, to the extent not offset by capital losses, be
paid to you as a distribution of capital gains and will be taxable to you as
short-term or long-term capital gains. See "Distributions," page 22.

In January of the year following the distribution, if you own shares in a
taxable account, you will receive a Form 1099-DIV notifying you of the status of
your distributions for federal income tax purposes.

Distributions may also be subject to state and local taxes, even if all or
a substantial part of such distributions are derived from interest on U.S.
government obligations which, if you received them directly, would be exempt
from state income tax. However, most but not all states allow this tax exemption
to pass through to fund shareholders when a fund pays distributions to its
shareholders. You should consult your tax advisor about the tax status of such
distributions in your own state.

If you have not complied with certain provisions of the Internal Revenue
Code, we or your financial intermediary is required by federal law to withhold
and remit to the IRS 31% of reportable payments (which may include dividends,
capital gains distributions and redemptions). Those regulations require you to
certify that the Social Security number or tax identification number you provide
is correct and that you are not subject to 31% withholding for previous
under-reporting to the IRS. You will be asked to make the appropriate
certification on your application. Payments reported by us that omit your Social
Security number or tax identification number will subject us to a penalty of
$50, which will be charged against your account if you fail to provide the
certification by the time the report is filed. This charge is not refundable.

Redemption of shares of a fund (including redemptions made in an exchange
transaction) will be a taxable transaction for federal income tax purposes and
shareholders will generally recognize gain or loss in an amount equal to the
difference between the basis of the shares and the amount received. Assuming
that shareholders hold such shares as a capital asset, the gain or loss will be
a capital gain or loss and will generally be long term if shareholders have held
such shares for a period of more than one year. If a loss is realized on the
redemption of fund shares, the reinvestment in additional fund shares within 30
days before or after the redemption may be subject to the "wash sale" rules of
the Code, resulting

Prospectus Additional Information You Should Know 23

in a postponement of the recognition of such loss for federal income tax
purposes.

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 funds. Acting pursuant
to an investment management agreement entered into with the funds, American
Century Investment Management, Inc. serves as the investment manager of the
funds. 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 clients since it was
founded in 1958.

In June 1995, American Century Companies, Inc. ("ACC"), the parent of the
manager, acquired Benham Management International, Inc. In the acquisition,
Benham Management Corporation ("BMC"), the investment advisor to The Benham
Group of mutual funds, became a wholly owned subsidiary of ACC. Certain
employees of BMC provide investment management services to funds managed by the
manager, while certain employees of the manager provide investment management
services to funds managed by BMC.

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

The portfolio manager members of the teams managing the funds described in
this Prospectus and their work experience for the past five years are as
follows:

THEODORE J. TYSON, Vice President and Portfolio Manager, joined American
Century in 1988 and has been a member of the International Growth and
International Discovery team since its inception in 1991.

HENRIK STRABO, Vice President and Portfolio Manager, joined American
Century in 1993 as an Investment Analyst on the International Growth and
International Discovery team and has been a Portfolio Manager member of the team
since 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.

The activities of the manager are subject only to directions of the funds'
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.

For the services provided to the Institutional Class of the funds, the
manager receives a management fee calculated as a percentage of the average net
assets of the fund as follows:

Fund Percent of Average Net Assets
- -----------------------------------------------------------------------------
International Growth 1.30% of first $1 billion
1.00% of the next $1 billion
0.90% over $2 billion

International Discovery 1.55% of first $500 million
1.20% of the next $500 million
1.00% over $1 billion
- -----------------------------------------------------------------------------

On the first business day of each month, each fund pays the 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 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).

The management fees paid by the funds to the manager are higher than the
fees paid by the various other funds in the American Century family of funds
because of the higher costs and additional expenses associated with managing and
operating a fund owning a portfolio consisting primarily of foreign securities.
The fee may also be higher than the fee paid by many other international or
foreign investment companies.

24 Additional Information You Should Know American Century Investments

Many other investment companies may refer to or publicize an "investment
management fee" or "management fee" paid by the company to its manager. However,
most such companies also use fund assets to pay for certain expenses of the fund
in addition to the stated management fee. In contrast, the management fee paid
to the manager includes payment for almost all fund expenses, with the
exceptions noted. Therefore, potential investors who attempt to compare the
expenses of these funds to the expenses of other funds should be careful to
compare only the ratio of total expenses to average net assets contained in the
Financial Highlights table found on pages 5 and 6 of this Prospectus to the same
ratio of the other funds.

The management agreement also provides that the Corporation's board of
directors, upon 60 days' prior written notice to all affected shareholders, may
impose a servicing or administrative fee as a charge against shareholder
accounts.

CODE OF ETHICS

The funds 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 funds' portfolios
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 provisions 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

American Century Services Corporation, 4500 Main Street, Kansas City,
Missouri 64111 acts as transfer agent and dividend-paying agent for the funds.
It provides facilities, equipment and personnel to the funds, 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 an insurance company or
other entity providing similar services for various retirement plans using
shares of the funds as a funding medium, by broker-dealers and financial
advisors for their customers investing in shares of American Century or by
sponsors of multi mutual fund no- or low-transaction fee programs.

Although there is no sales charge levied by the funds, transactions in
shares of the funds may be executed by brokers or investment advisors who charge
a transaction-based fee or other fee for their services. Such charges may vary
among broker-dealers and financial advisors, but in all cases will be retained
by the broker-dealer or financial advisor and not remitted to the funds or the
investment manager. You should be aware of the fact that these transactions may
be made directly with American Century without incurring such fees.

From time to time, special services may be offered to shareholders who
maintain higher share balances in the American Century family of funds. These
services may include the waiver of minimum investment requirements, expedited
confirmation of shareholder transactions, newsletters, and a team of personal
representatives. Any expenses associated with these special services will be
paid by the manager.

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

DISTRIBUTION OF FUND SHARES

The funds' shares are distributed by American Century Investment Services,
Inc., a registered broker-dealer and an affiliate of the manager. The manager
pays all expenses for promoting sales of, and distributing the Institutional
Class shares offered by this Prospectus. The Institutional Class of shares does
not pay any commissions or other fees to the distributor or to any other
broker-dealers or financial intermediaries in connection with the distribution
of fund shares.

Prospectus Additional Information You Should Know 25

FURTHER INFORMATION ABOUT AMERICAN CENTURY

American Century World Mutual Funds, Inc., the issuer of the funds, was
organized as a Maryland corporation on December 28, 1990.

The principal office of the funds 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 1-800-345-3533
(international calls: 816-531-5575).

American Century World Mutual Funds issues two series of $.01 par value
shares. Each series is commonly referred to as a fund. The assets belonging to
each series of shares are held separately by the custodian.

American Century offers four classes of each of the funds offered by this
Prospectus: an Investor Class, an Institutional Class, a Service Class, and an
Advisor Class. The shares offered by this Prospectus are Institutional Class
shares and have no up-front charges, commissions, or 12b-1 fees.

The Investor Class is primarily made available to retail investors. The
Service Class and Advisor Class are primarily offered to institutional investors
or through institutional distribution channels, such as employer-sponsored
retirement plans or through banks, broker-dealers, insurance companies or other
financial intermediaries. The other classes have different fees, expenses,
and/or minimum investment requirements than the institutional class. Different
fees and expenses will affect performance. For additional information concerning
the Investor Class of shares, call one of our Investor Services Representatives
at 1-800-345-2021. For additional information concerning the Service Class and
Advisor Classes of shares not offered by this Prospectus, call one of our
Institutional Service Representatives at 1-800-345-3533 or contact a sales
representative or financial intermediary who offers those classes of shares.

Except as described below, all classes of shares of a fund have identical
voting, dividend, liquidation and other rights, preferences, terms and
conditions. The only differences among the various classes are (a) each class
may be subject to different expenses specific to that class, (b) each class has
a different identifying designation or name, (c) each class has exclusive voting
rights with respect to matters solely affecting such class, (d) each class may
have different exchange privileges, and (e) the Institutional Class may provide
for automatic conversion from that class into shares of the Investor Class of
the same fund.

Each share, irrespective of series or class, 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 or class of
the shares affected. Matters affecting only one series or class are voted upon
only by that series or class.

Shares have non-cumulative voting rights, which means that the 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.

Unless required by the Investment Company Act, it will not be necessary for
the funds to hold annual meetings of shareholders. As a result, shareholders may
not vote each year on the election of directors or the appointment of auditors.
However, pursuant to the funds' bylaws, the holders of shares representing at
least 10% of the votes entitled to be cast may request the funds to hold a
special meeting of shareholders. We will assist in the communication with other
shareholders.

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.

26 Additional Information You Should Know American Century Investments

NOTES

Prospectus Notes 27

NOTES

28 Notes American Century Investments

NOTES

Notes 29

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

Person-to-person assistance:
1-800-345-3533 or 816-531-5575

Telecommunications Device for the Deaf:
1-800-345-1833 or 816-753-0700

Fax: 816-340-4655

Internet: www.americancentury.com

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