MSDW SHORT TERM U S TREASURY TRUST, 485BPOS, 2000-07-28

MSDW SHORT TERM U S TREASURY TRUST
485BPOS, 2000-07-28

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<PAGE>

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 28, 2000

REGISTRATION NOS.: 33-41187
811-6330
================================================================================

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

----------------

FORM N-1A
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933 [X]
PRE-EFFECTIVE AMENDMENT NO. [ ]
POST-EFFECTIVE AMENDMENT NO. 10 [X]
AND/OR
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY
ACT OF 1940 [X]
AMENDMENT NO. 11 [X]

----------------

MORGAN STANLEY DEAN WITTER SHORT-TERM U.S. TREASURY TRUST
(A MASSACHUSETTS BUSINESS TRUST)
TWO WORLD TRADE CENTER
NEW YORK, NEW YORK 10048
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICE)

REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (212) 392-1600
BARRY FINK, ESQ.
TWO WORLD TRADE CENTER
NEW YORK, NEW YORK 10048
(NAME AND ADDRESS OF AGENT FOR SERVICE)

Copy to:
STUART M. STRAUSS, ESQ.
MAYER BROWN & PLATT
1675 BROADWAY
NEW YORK, NEW YORK 10019

----------------

APPROXIMATE DATE OF PROPOSED PUBLIC OFFERING:

As soon as practicable after this Post-Effective Amendment becomes effective.

IT IS PROPOSED THAT THIS FILING WILL BECOME EFFECTIVE (CHECK APPROPRIATE BOX)

immediately upon filing pursuant to paragraph (b)
---
X on July 31, 2000 pursuant to paragraph (b)
---
60 days after filing pursuant to paragraph (a)
---
on (date) pursuant to paragraph (a) of rule 485.
---

----------------

AMENDING THE PROSPECTUS AND UPDATING FINANCIAL STATEMENTS

================================================================================
<PAGE>

PROSPECTUS - JULY 31, 2000

Morgan Stanley Dean Witter

----------------------------------------------------------------

SHORT-TERM U.S. TREASURY TRUST

A MUTUAL FUND THAT SEEKS CURRENT
INCOME, PRESERVATION OF PRINCIPAL AND LIQUIDITY

The Securities and Exchange Commission has not approved or disapproved these
securities or passed upon the adequacy of this Prospectus. Any representation
to the contrary is a criminal offense.

<PAGE>

CONTENTS

<TABLE>
<S> <C>
The Fund Investment Objective ........................... 1
Principal Investment Strategies ................ 1
Principal Risks ................................ 1
Past Performance ............................... 3
Fees and Expenses .............................. 4
Additional Investment Strategy Information ..... 4
Fund Management ................................ 5

Shareholder Information Pricing Fund Shares ............................ 6
How to Buy Shares .............................. 6
How to Exchange Shares ......................... 7
How to Sell Shares ............................. 10
Distributions .................................. 12
Tax Consequences ............................... 12

Financial Highlights ................................................ 14

Our Family of Funds ................................. Inside Back Cover

This Prospectus contains important information about
the Fund. Please read it carefully and keep it for
future reference.
</TABLE>

<PAGE>

THE FUND

[GRAPHIC OMITTED]

INVESTMENT OBJECTIVE
--------------------------------

Morgan Stanley Dean Witter Short-Term U.S. Treasury Trust seeks
current income, preservation of principal and liquidity.

[GRAPHIC OMITTED]

PRINCIPAL INVESTMENT STRATEGIES
--------------------------------------------

[sidebar]
INCOME
An investment objective having the goal of selecting securities to pay out
income rather than rise in price.
[end sidebar]

The Fund will invest all of its net assets in U.S. Treasury
securities. The Fund's "Investment Manager," Morgan Stanley Dean
Witter Advisors Inc., seeks to maintain a portfolio with a
dollar-weighted average maturity of less than 3 years.

U.S. Treasury securities are direct obligations of the U.S. government
and can take the form of bonds, notes or bills. The U.S. government
borrows money from the investor who buys the security. U.S. Treasury
securities generally pay interest at regular intervals until they
mature, at which point investors get their principal back. U.S.
Treasury securities are backed by the "full faith and credit" of the
U.S. government.

Zero Coupon Treasury Securities. A portion of the U.S. Treasury
securities purchased by the Fund may be "zero coupon" Treasury
securities. These are U.S. Treasury notes and bonds which have been
stripped of their unmatured interest coupons and receipts or which
are certificates representing interests in such stripped debt
obligations and coupons. Such securities are purchased at a discount
from their face amount, giving the purchaser the right to receive
their full value at maturity. A zero coupon security pays no interest
to its holder during its life. Its value to an investor consists of
the difference between its face value at the time of maturity and the
price for which it was acquired, which is generally an amount
significantly less than its face value (sometimes referred to as a
"deep discount" price).

In pursuing the Fund's investment objective, the Investment Manager
has considerable leeway in deciding which investments it buys, holds
or sells on a day-to-day basis -- and which trading strategies it
uses. For example, the Investment Manager in its discretion may
determine to use some permitted trading strategies while not using
others.

[GRAPHIC OMITTED]

PRINCIPAL RISKS
--------------------------

There is no assurance that the Fund will achieve its investment
objective. The Fund's share price and yield will fluctuate with
changes in the market value of the Fund's portfolio securities. The
Fund's yield also will vary based on the yield of the Fund's
portfolio securities. Neither the value nor the yield of the U.S.
government securities that the Fund invests in (or the value or yield
of the Fund's shares) is guaranteed by the

<PAGE>

U.S. government. When you sell Fund shares, they may be worth less
than what you paid for them and, accordingly, you can lose money
investing in this Fund.

U.S. Treasury Securities. A principal risk of investing in the Fund
is associated with its U.S. Treasury securities, which are
fixed-income securities. All fixed-income securities are subject to
two types of risk: credit risk and interest rate risk. Credit risk
refers to the possibility that the issuer of a security will be
unable to make interest payments and/or repay the principal on its
debt. The credit risk associated with U.S. Treasury securities is
minimal.

Interest rate risk refers to fluctuations in the value of a
fixed-income security resulting from changes in the general level of
interest rates. When the general level of interest rates goes up, the
prices of most fixed-income securities go down. When the general
level of interest rates goes down, the prices of most fixed-income
securities go up. As merely illustrative of the relationship between
fixed-income securities and interest rates, the following table shows
how interest rates affect bond prices.

<TABLE>
<CAPTION>
HOW INTEREST RATES AFFECT BOND PRICES
---------------------------------------------------------------------------------------------------
PRICE PER $1,000 OF A BOND IF INTEREST RATES:
---------------------------------------------
INCREASE DECREASE
---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Bond Maturity Coupon 1% 2% 1% 2%
---------------------------------------------------------------------------------------------------
1 Year N/A $1,000 $1,000 $1,000 $1,000
---------------------------------------------------------------------------------------------------
5 Years 5.875% $ 951 $ 920 $1,018 $1,054
---------------------------------------------------------------------------------------------------
10 Years 6.00% $ 910 $ 853 $1,038 $1,110
---------------------------------------------------------------------------------------------------
30 Years 6.125% $ 841 $ 748 $1,093 $1,264
---------------------------------------------------------------------------------------------------
</TABLE>

Coupons reflect yields on Treasury securities as of December 31,
1999. The table is an illustration and does not represent expected
yields or share price changes of any Morgan Stanley Dean Witter
mutual fund.

The interest earned on zero coupon Treasury securities is,
implicitly, automatically compounded and paid out at maturity. While
such compounding at a constant rate eliminates the risk of receiving
lower yields upon reinvestment of interest if prevailing interest
rates decline, the owner of a zero coupon security will be unable to
participate in higher yields upon reinvestment of interest received
if prevailing interest rates rise. For this reason, zero coupon
securities are subject to substantially greater market price
fluctuations during periods of changing prevailing interest rates
than are comparable debt securities which make current distributions
of interest.

The performance of the Fund also will depend on whether the
Investment Manager is successful in pursuing the Fund's investment
strategy.

<PAGE>

Shares of the Fund are not bank deposits and are not guaranteed or
insured by the FDIC or any other government agency.

[GRAPHIC OMITTED]

PAST PERFORMANCE
----------------------------

The bar chart and table below provide some indication of the risks of
investing in the Fund. The Fund's past performance does not indicate
how the Fund will perform in the future.

[sidebar]
ANNUAL TOTAL RETURNS
This chart shows how the performance of the Fund's shares has varied from year
to year over the past 8 calendar years.
[end sidebar]

ANNUAL TOTAL RETURNS -- CALENDAR YEARS

5.38% 4.96% (1.23)% 9.82% 3.89% 6.07% 6.90% 1.36%

1992 '93 '94 '95 '96 '97 '98 '99

Year-to-date total return as of June 30, 2000 was 2.47%.

During the periods shown in the bar chart, the highest return for a
calendar quarter was 4.02% (quarter ended September 30, 1998) and the
lowest return for a calendar quarter was -1.34% (quarter ended March
31, 1994).

[sidebar]
AVERAGE ANNUAL
TOTAL RETURNS
This table compares the Fund's average annual total returns with those of a
broad measure of market performance over time.
[end sidebar]

<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS (AS OF DECEMBER 31, 1999)
------------------------------------------------------------------------------------
LIFE OF FUND
PAST 1 YEAR PAST 5 YEARS (SINCE 8/13/91)
------------------------------------------------------------------------------------
<S> <C> <C> <C>
Short-Term U.S. Treasury Trust 1.36% 5.57% 5.01%
------------------------------------------------------------------------------------
Lehman Brothers 1-3 year Government
Bond Index(1) 2.97% 6.47% 5.91%(2)
------------------------------------------------------------------------------------
</TABLE>

1 The Lehman Brothers 1-3 year Government Bond Index is a sub-index of the
Lehman Brothers Government Bond Index and is comprised of Agency and
Treasury securities with maturities of one to three years. The index does
not include any expenses, fees or charges. The Index is unmanaged and
should not be considered an investment.

2 For the period August 31, 1991 to December 31, 1999.

<PAGE>

[GRAPHIC OMITTED]

FEES AND EXPENSES
-----------------------------

The table below briefly describes the fees and expenses that you may
pay if you buy and hold shares of the Fund. The Fund does not impose
an initial or deferred sales charge and does not charge account or
exchange fees.

[sidebar]
ANNUAL FUND
OPERATING EXPENSES
These expenses are deducted
from the Fund's assets and are
based on expenses paid for the
fiscal year ended May 31, 2000.
[end sidebar]

<TABLE>
<CAPTION>
ANNUAL FUND OPERATING EXPENSES
------------------------------------------------------
<S> <C>
Management fee 0.35%
------------------------------------------------------
Distribution and service (12b-1) fees 0.34%
------------------------------------------------------
Other expenses 0.11%
------------------------------------------------------
Total annual Fund operating expenses 0.80%
------------------------------------------------------
</TABLE>

Example

This example is intended to help you compare the cost of investing in
the Fund with the cost of investing in other mutual funds.

The example assumes that you invest $10,000 in the Fund, your
investment has a 5% return each year, and the Fund's operating
expenses remain the same. Although your actual costs may be higher or
lower, the table below shows your costs at the end of each period
based on these assumptions.

<TABLE>
<CAPTION>
EXPENSES OVER TIME
--------------------------------------
1 YEAR 3 YEARS 5 YEARS 10 YEARS
-------- --------- --------- ---------
<S> <C> <C> <C>
$82 $255 $444 $990
-------- --------- --------- ---------
</TABLE>

[GRAPHIC OMITTED]

ADDITIONAL INVESTMENT STRATEGY INFORMATION
---------------------------------------------------------

This section provides additional information relating to the Fund's
principal investment strategies.

Portfolio Turnover. The Fund may engage in active and frequent
trading of its portfolio securities. The Financial Highlights Table
at the end of this Prospectus shows the Fund's portfolio turnover
rates during recent fiscal years. A portfolio turnover rate of 200%,
for example, is equivalent to the Fund buying and selling all of its
securities two times during the course of the year. A high portfolio
turnover rate (over 100%) could result in high brokerage costs and an
increase in taxable capital gains distributions to the Fund's
shareholders. See the sections on "Distributions" and "Tax
Consequences."

The percentage limitations relating to the composition of the Fund's
portfolio apply at the time the Fund acquires an investment and refer
to the Fund's net assets, unless otherwise noted. Subsequent
percentage changes that result from market fluctuations

<PAGE>

will not require the Fund to sell any portfolio security. The Fund
may change its principal investment strategies without shareholder
approval; however, you would be notified of any changes.

[GRAPHIC OMITTED]

FUND MANAGEMENT
----------------------------

[sidebar]
MORGAN STANLEY DEAN WITTER ADVISORS INC.
The Investment Manager is widely recognized as a leader in the mutual fund
industry and together with Morgan Stanley Dean Witter Services Company Inc.,
its wholly-owned subsidiary, had approximately $150 billion in assets under
management as of June 30, 2000.
[end sidebar]

The Fund has retained the Investment Manager -- Morgan Stanley Dean
Witter Advisors Inc. -- to provide administrative services, manage its
business affairs and invest its assets, including the placing of
orders for the purchase and sale of portfolio securities. The
Investment Manager is a wholly-owned subsidiary of Morgan Stanley Dean
Witter & Co., a preeminent global financial services firm that
maintains leading market positions in each of its three primary
businesses: securities, asset management and credit services. Its main
business office is located at Two World Trade Center, New York, NY
10048.

The Fund's portfolio is managed within the Investment Manager's
Taxable Fixed Income Group. Rajesh K. Gupta, Senior Vice President and
Director of the Taxable Fixed-Income Group and Chief Administrative
Officer of Investments of the Investment Manager, is the Fund's
portfolio manager. Co-management has been provided by Sally Sancimino,
a Vice President of the Investment Manager, since July 2000. Both Mr.
Gupta and Ms. Sancimino have been portfolio managers at the Investment
Manager for over five years.

The Fund pays the Investment Manager a monthly management fee as full
compensation for the services and facilities furnished to the Fund,
and for Fund expenses assumed by the Investment Manager. The fee is
based on the Fund's average daily net assets. For the fiscal year
ended May 31, 2000, the Fund accrued total compensation to the
Investment Manager amounting to 0.35% of the Fund's average daily net
assets.

<PAGE>

SHAREHOLDER INFORMATION

[GRAPHIC OMITTED]

PRICING FUND SHARES
-------------------------------
The price of Fund shares, called "net asset value," is based on the
value of the Fund's portfolio securities.

The net asset value per share of the Fund is determined once daily at
4:00 p.m. Eastern time on each day that the New York Stock Exchange
is open (or, on days when the New York Stock Exchange closes prior to
4:00 p.m., at such earlier time). Shares will not be priced on days
that the New York Stock Exchange is closed.

The value of the Fund's portfolio securities is based on the
securities' market price when available. When a market price is not
readily available, including circumstances under which the Investment
Manager determines that a security's market price is not accurate, a
portfolio security is valued at its fair value, as determined under
procedures established by the Fund's Board of Trustees. In these
cases, the Fund's net asset value will reflect certain portfolio
securities' fair value rather than their market price.

An exception to the Fund's general policy of using market prices
concerns its short-term debt portfolio securities. Short-term debt
portfolio securities with remaining maturities of sixty days or less
at the time of purchase are valued at amortized cost. However, if the
cost does not reflect the securities' market value, these securities
will be valued at their fair value.

[GRAPHIC OMITTED]

HOW TO BUY SHARES
------------------------------

[sidebar]
CONTACTING A FINANCIAL ADVISOR
If you are new to the Morgan Stanley Dean Witter Family of Funds and would like
to contact a Financial Advisor, call (877) 937-MSDW (toll-free) for the
telephone number of the Morgan Stanley Dean Witter office nearest you. You may
also access our office locator on our Internet site at:
www.msdw.com/individual/funds
[end sidebar]

You may open a new account to buy Fund shares or buy additional Fund
shares for an existing account by contacting your Morgan Stanley Dean
Witter Financial Advisor or other authorized financial representative.
Your Financial Advisor will assist you, step-by-step, with the
procedures to invest in the Fund. You may also purchase shares
directly by calling the Fund's transfer agent and requesting an
application.

When you buy Fund shares, the shares are purchased at the next share
price calculated after we receive your purchase order. You begin
earning dividends on the next business day after the shares are
purchased. We reserve the right to reject any order for the purchase
of Fund shares.

<PAGE>

[sidebar]
EASYINVEST(SM)
A purchase plan that allows you to transfer money automatically from your
checking or savings account or from a Money Market Fund on a semi-monthly,
monthly or quarterly basis. Contact your Morgan Stanley Dean Witter Financial
Advisor for further information about this service.
[end sidebar]

<TABLE>
<CAPTION>
MINIMUM INVESTMENT AMOUNTS
----------------------------------------------------------
MINIMUM INVESTMENT
------------------
INVESTMENT OPTIONS INITIAL ADDITIONAL
----------------------------------------------------------
<S> <C> <C>
Regular Accounts: $ 10,000 $ 100
----------------------------------------------------------
EasyInvest(SM)
(Automatically from your
checking or savings account
or Money Market Fund) $ 1,000* $ 100*
----------------------------------------------------------
</TABLE>

* Provided your schedule of investments totals $10,000 in twelve months.

Subsequent Investments Sent Directly to the Fund. In addition to
buying additional Fund shares for an existing account by contacting
your Morgan Stanley Dean Witter Financial Advisor, you may send a
check directly to the Fund. To buy additional shares in this manner:

o Write a "letter of instruction" to the Fund specifying the
name(s) on the account, the account number, the social security
or tax identification number, and the investment amount. The
letter must be signed by the account owner(s).

o Make out a check for the total amount payable to: Morgan Stanley
Dean Witter Short-Term U.S. Treasury Trust.

o Mail the letter and check to Morgan Stanley Dean Witter Trust FSB
at P.O. Box 1040, Jersey City, NJ 07303.

PLAN OF DISTRIBUTION The Fund has adopted a Plan of Distribution in
accordance with Rule 12b-1 under the Investment Company Act of 1940.
The Plan allows the Fund to pay distribution fees of up to 0.35% for
the sale and distribution of shares. It also allows the Fund to pay
for services to shareholders of shares. Because these fees are paid
out of the Fund's assets on an ongoing basis, over time these fees
will increase the cost of your investment in shares and may cost you
more than paying other types of sales charges.

[GRAPHIC OMITTED]

HOW TO EXCHANGE SHARES
------------------------------------
Permissible Fund Exchanges. You may only exchange shares of the Fund
for shares of other continuously offered Morgan Stanley Dean Witter
Funds if the Fund shares were acquired in an exchange of shares
initially purchased in a Multi-Class Fund or an FSC Fund (subject to
a front-end sales charge). In that case, the shares may be
subsequently re-exchanged for shares of the same Class of any
Multi-Class Fund or FSC Fund or for

<PAGE>

shares of a No-Load Fund, a Money Market Fund or North American
Government Income Trust. Of course, if an exchange is not permitted,
you may sell shares of the Fund and buy another fund's shares with
the proceeds.

See the inside back cover of this Prospectus for each Morgan Stanley
Dean Witter Fund's designation as a Multi-Class Fund, No-Load Fund,
Money Market Fund or FSC Fund. If a Morgan Stanley Dean Witter Fund
is not listed, consult the inside back cover of that fund's
prospectus for its designation.

The current prospectus for each fund describes its investment
objective(s), policies and investment minimums, and should be read
before investment. Since exchanges are available only into
continuously offered Morgan Stanley Dean Witter Funds, exchanges are
not available into any new Morgan Stanley Dean Witter Fund during its
initial offering period, or when shares of a particular Morgan
Stanley Dean Witter Fund are not being offered for purchase.

Exchange Procedures. You can process an exchange by contacting your
Morgan Stanley Dean Witter Financial Advisor or other authorized
financial representative. Otherwise, you must forward an exchange
privilege authorization form to the Fund's transfer agent -- Morgan
Stanley Dean Witter Trust FSB -- and then write the transfer agent or
call (800) 869-NEWS to place an exchange order. You can obtain an
exchange privilege authorization form by contacting your Financial
Advisor or other authorized financial representative, or by calling
(800) 869-NEWS. If you hold share certificates, no exchanges may be
processed until we have received all applicable share certificates.

An exchange to any Morgan Stanley Dean Witter Fund (except a Money
Market Fund) is made on the basis of the next calculated net asset
values of the funds involved after the exchange instructions are
accepted. When exchanging into a Money Market Fund, the Fund's shares
are sold at their next calculated net asset value and the Money
Market Fund's shares are purchased at their net asset value on the
following business day.

The Fund may terminate or revise the exchange privilege upon required
notice. The check writing privilege is not available for Money Market
Fund shares you acquire in an exchange.

Telephone Exchanges. For your protection when calling Morgan Stanley
Dean Witter Trust FSB, we will employ reasonable procedures to
confirm that exchange instructions communicated over the telephone
are genuine. These procedures may include requiring various forms of
personal identification such as name, mailing address, social
security or other tax identification number. Telephone instructions
also may be recorded.

Telephone instructions will be accepted if received by the Fund's
transfer agent between 9:00 a.m. and 4:00 p.m. Eastern time on any
day the New York Stock Exchange is open for business. During periods
of drastic economic or market changes, it is

<PAGE>

possible that the telephone exchange procedures may be difficult to
implement, although this has not been the case with the Fund in the
past.

Exchanging Shares of Another Fund Subject to a Contingent Deferred
Sales Charge ("CDSC"). There are special considerations when you
exchange shares subject to a CDSC of another Morgan Stanley Dean
Witter Fund for shares of the Fund. When determining the length of
time you held the shares and the corresponding CDSC rate, any period
(starting at the end of the month) during which you held shares of
the Fund will not be counted. Thus, in effect the "holding period"
for purposes of calculating the CDSC is frozen upon exchanging into
the Fund. Nevertheless, if shares subject to a CDSC are exchanged for
shares of the Fund, you will receive a credit when you sell the
shares equal to the distribution (12b-1) fees, if any, you paid on
those shares while in the Fund up to the amount of any applicable
CDSC. See the prospectus of the fund that charges the CDSC for more
details.

Tax Considerations of Exchanges. If you exchange shares of the Fund
for shares of another Morgan Stanley Dean Witter Fund there are
important tax considerations. For tax purposes, the exchange out of
the Fund is considered a sale of Fund shares -- and the exchange into
the other fund is considered a purchase. As a result, you may realize
a capital gain or loss.

You should review the "Tax Consequences" section and consult your own
tax professional about the tax consequences of an exchange.

Limitations on Exchanges. Certain patterns of past exchanges and/or
purchase or sale transactions involving the Fund or other Morgan
Stanley Dean Witter Funds may result in the Fund limiting or
prohibiting, at its discretion, additional purchases and/or
exchanges. Determinations in this regard may be made based on the
frequency or dollar amount of the previous exchanges or purchase or
sale transactions. You will be notified in advance of limitations on
your exchange privileges.

For further information regarding exchange privileges, you should
contact your Morgan Stanley Dean Witter Financial Advisor or call
(800) 869-NEWS.

9
<PAGE>

[GRAPHIC OMITTED]

HOW TO SELL SHARES
-------------------------------
You can sell some or all of your Fund shares at any time. Your shares
will be sold at the next share price calculated after we receive your
order to sell as described below.

<TABLE>
<CAPTION>
OPTIONS PROCEDURES
--------------------- -----------------------------------------------------------------------------------------------
<S> <C>
Contact Your To sell your shares, simply call your Morgan Stanley Dean Witter Financial Advisor or other
Financial Advisor authorized financial representative.
-----------------------------------------------------------------------------------------------
[GRAPHIC OMITTED] Payment will be sent to the address to which the account is registered or deposited in your
Dean Witter Reynolds brokerage account.
--------------------- -----------------------------------------------------------------------------------------------
Check-writing You may order a supply of blank checks by requesting them on the investment application or
Option by contacting your Morgan Stanley Dean Witter Financial Advisor.
-----------------------------------------------------------------------------------------------
[GRAPHIC OMITTED] Checks may be written in any amount not less than $500. You must sign checks exactly as
their shares are registered. If the account is a joint account, the check may contain one
signature unless the joint owners have specified on an investment application that all owners
are required to sign checks. Only accounts in which no share certificates have been issued
are eligible for the checkwriting privilege.
-----------------------------------------------------------------------------------------------
Payment of check proceeds normally will be made on the next business day after we receive
your check in proper form. Shares purchased by check (including a certified or bank cashier's
check) are not normally available to cover redemption checks until fifteen days after Morgan
Stanley Dean Witter Trust FSB receives the check used for investment. A check will not be
honored in an amount exceeding the value of the account at the time the check is presented
for payment.
-----------------------------------------------------------------------------------------------
By Letter You may also sell your shares by writing a "letter of instruction" that includes:
[GRAPHIC OMITTED] o your account number;
o the dollar amount or the number of shares you wish to sell; and
o the signature of each owner as it appears on the account.
-----------------------------------------------------------------------------------------------
If you are requesting payment to anyone other than the registered owner(s) or that payment
be sent to any address other than the address of the registered owner(s) or pre-designated
bank account, you will need a signature guarantee. You can obtain a signature guarantee from
an eligible guarantor acceptable to Morgan Stanley Dean Witter Trust FSB. (You should
contact Morgan Stanley Dean Witter Trust FSB at (800) 869-NEWS for a determination as to
whether a particular institution is an eligible guarantor.) A notary public cannot provide a
signature guarantee. Additional documentation may be required for shares held by a
corporation, partnership, trustee or executor.
-----------------------------------------------------------------------------------------------
Mail the letter to Morgan Stanley Dean Witter Trust FSB at P.O. Box 983, Jersey City, NJ
07303. If you hold share certificates, you must return the certificates, along with the letter
and any required additional documentation.
-----------------------------------------------------------------------------------------------
A check will be mailed to the name(s) and address in which the account is registered, or
otherwise according to your instructions.
-----------------------------------------------------------------------------------------------
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
OPTIONS PROCEDURES
------------------- -----------------------------------------------------------------------------------------------
<S> <C>
Systematic If your investment in all of the Morgan Stanley Dean Witter Family of Funds has a total
Withdrawal Plan market value of at least $10,000, you may elect to withdraw amounts of $25 or more, or in
any whole percentage of a fund's balance (provided the amount is at least $25), on a monthly,
[GRAPHIC OMITTED] quarterly, semi-annual or annual basis, from any fund with a balance of at least $1,000. Each
time you add a fund to the plan, you must meet the plan requirements.
-----------------------------------------------------------------------------------------------
When you sell Fund shares through the Systematic Withdrawal Plan, the shares may be
subject to a contingent deferred sales charge ("CDSC") if they were obtained in exchange for
shares subject to a CDSC of another Morgan Stanley Dean Witter Fund. The CDSC,
however, will be waived in an amount up to 12% annually of the Fund's value, although Fund
shares with no CDSC will be sold first, followed by those with the lowest CDSC. As such,
the waiver benefit will be reduced by the amount of your shares that are not subject to a
CDSC. See the prospectus of the fund that charges the CDSC for more details.
-----------------------------------------------------------------------------------------------
To sign up for the Systematic Withdrawal Plan, contact your Morgan Stanley Dean Witter
Financial Advisor or call (800) 869-NEWS. You may terminate or suspend your plan at any
time. Please remember that withdrawals from the plan are sales of shares, not Fund
"distributions," and ultimately may exhaust your account balance. The Fund may terminate or
revise the plan at any time.
-----------------------------------------------------------------------------------------------
By Telephone To sell shares by telephone or wire, first complete a telephone redemption application
or Wire designating a bank account. Redemptions for more than $1,000 will be wired to your bank
account (your bank may charge a fee for this service). For redemptions for less than $1,000, a
[GRAPHIC OMITTED] check will be mailed to your bank account. If you hold share certificates, you may not redeem
those shares by this method. For more information or to request a telephone redemption
[GRAPHIC OMITTED] application, call Morgan Stanley Dean Witter Trust FSB at (800) 869-NEWS.
-----------------------------------------------------------------------------------------------
</TABLE>

Payment for Sold Shares. After we receive your complete instructions
to sell as described above, a check will be mailed to you within
seven days, although we will attempt to make payment within one
business day. Payment may also be sent to your brokerage account.

Payment may be postponed or the right to sell your shares suspended
under unusual circumstances. If you request to sell shares that were
recently purchased by check, your sale will not be effected until it
has been verified that the check has been honored.

Involuntary Sales. The Fund reserves the right, on sixty days'
notice, to sell the shares of any shareholder (other than shares held
in an IRA or 403(b) Custodial Account) whose shares, due to sales by
the shareholder, have a value below $1,000 or in the case of an
account opened through EasyInvest(SM), if after 12 months the
shareholder has invested less than $10,000 in the account.

However, before the Fund sells your shares in this manner, we will
notify you and allow you sixty days to make an additional investment
in an amount that will increase the value of your account to at least
the required amount before the sale is processed.

Margin Accounts. If you have pledged your Fund shares in a margin
account, contact your Morgan Stanley Dean Witter Financial Advisor or
other authorized financial representative regarding restrictions on
the sale of such shares.

<PAGE>

[GRAPHIC OMITTED]

DISTRIBUTIONS
------------------------

[sidebar]
TARGETED DIVIDENDS(SM)
You may select to have your Fund distributions automatically invested in
another Morgan Stanley Dean Witter Fund that you own. Contact your Morgan
Stanley Dean Witter Financial Advisor for further information about this
service.
[end sidebar]

The Fund passes substantially all of its earnings from income and
capital gains along to its investors as "distributions." The Fund
earns interest from fixed-income investments. Also, any zero coupon
security investments under federal law accrue a portion of the
discount at which the security was purchased as income even though the
Fund receives no interest payments in cash. Interest is passed along
to Fund shareholders as "income dividend distributions." The Fund
realizes capital gains whenever it sells securities for a higher price
than it paid for them. These amounts may be passed along as "capital
gain distributions."

Normally, income dividends are declared on each day the New York Stock
Exchange is open for business and are distributed to shareholders
monthly. Capital gains, if any, are usually distributed in December.
The Fund, however, may retain and reinvest any long-term capital
gains. The Fund may at times make payments from sources other than
income or capital gains that represent a return of a portion of your
investment.

Distributions are reinvested automatically in additional shares of
the Fund and automatically credited to your account, unless you
request in writing that all distributions be paid in cash. If you
elect the cash option, processing of your dividend checks begins
immediately following the monthly payment date, and the Fund will
mail a monthly dividend check to you normally during the first seven
days of the following month. No interest will accrue on uncashed
checks. If you wish to change how your distributions are paid, your
request should be received by the Fund's transfer agent, Morgan
Stanley Dean Witter Trust FSB, at least five business days prior to
the record date of the distributions.

[GRAPHIC OMITTED]

TAX CONSEQUENCES
----------------------------
As with any investment, you should consider how your Fund investment
will be taxed. The tax information in this Prospectus is provided as
general information. You should consult your own tax professional
about the tax consequences of an investment in the Fund.

Unless your investment in the Fund is through a tax-deferred
retirement account, such as a 401(k) plan or IRA, you need to be
aware of the possible tax consequences when:

o The Fund makes distributions; and

o You sell Fund shares, including an exchange to another Morgan
Stanley Dean Witter Fund.

<PAGE>

Taxes on Distributions.

--Federal Taxes. Your distributions are normally subject to federal
income tax when they are paid, whether you take them in cash or
reinvest them in Fund shares. Any income dividend distributions and
any short-term capital gains are taxable to you as ordinary income.
Any long-term capital gain distributions are taxable to you as
long-term capital gains, no matter how long you have owned shares in
the Fund.

--State and Local Taxes. Your dividend distributions from net
investment income are normally exempt from state and local income
taxes. Any short-term capital gains are taxable to you as ordinary
income. Any long-term capital gain distributions are taxable to you
as long-term capital gains, no matter how long you have owned shares
in the Fund.

Every January, you will be sent a statement (IRS Form 1099-DIV)
showing the distributions paid to you in the previous year. The
statement provides information on your dividends and capital gains
for tax purposes.

TAXES ON SALES. Your sale of Fund shares normally is subject to
federal and state income tax and may result in a taxable gain or loss
to you. A sale also may be subject to local income tax. Your exchange
of Fund shares for shares of another Morgan Stanley Dean Witter Fund
is treated for tax purposes like a sale of your original shares and a
purchase of your new shares. Thus, the exchange may, like a sale,
result in a taxable gain or loss to you and will give you a new tax
basis for your new shares.

When you open your Fund account, you should provide your social
security or tax identification number on your investment application.
By providing this information, you will avoid being subject to a
federal backup withholding tax of 31% on taxable distributions and
sale proceeds. Any withheld amount would be sent to the IRS as an
advance tax payment.

<PAGE>

FINANCIAL HIGHLIGHTS

The financial highlights table is intended to help you understand the Fund's
financial performance for the past 5 years of the Fund. Certain information
reflects financial results for a single Fund share. The total returns in the
table represent the rate an investor would have earned or lost on an investment
in the Fund (assuming reinvestment of all dividends and distributions).

This information has been audited by PricewaterhouseCoopers, LLP, independent
accountants, whose report, along with the Fund's financial statements, is
included in the annual report, which is available upon request.

<TABLE>
<CAPTION>
FOR THE YEAR ENDED MAY 31, 2000 1999 1998 1997 1996
-------------------------- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
SELECTED PER SHARE DATA
------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 9.90 $ 9.96 $ 9.85 $ 9.84 $ 9.98
-------------------------------------------- -------- -------- -------- -------- --------
Income (loss) from investment operations:
Net investment income 0.51 0.50 0.53 0.54 0.54
Net realized and unrealized gain (loss) (0.24) (0.06) 0.11 -- (0.14)
-------- -------- -------- -------- --------
Total income from investment operations 0.27 0.44 0.64 0.54 0.40
-------------------------------------------- -------- -------- -------- -------- --------
Less dividends from net investment income (0.51) (0.50) (0.53) (0.53) (0.54)
-------------------------------------------- -------- -------- -------- -------- --------
Net asset value, end of period $ 9.66 $ 9.90 $ 9.96 $ 9.85 $ 9.84
-------------------------------------------- -------- -------- -------- -------- --------
TOTAL RETURN+ 2.83% 4.50% 6.68% 5.63% 4.09%
-------------------------------------------- -------- -------- -------- -------- --------
RATIOS TO AVERAGE NET ASSETS:
------------------------------------------------------------------------------------------------------------------------
Expenses 0.80%(1) 0.80% 0.82% 0.83% 0.84%
-------------------------------------------- -------- -------- -------- -------- --------
Net investment income 5.25% 4.95% 5.30% 5.42% 5.33%
-------------------------------------------- ---------- -------- -------- -------- --------
SUPPLEMENTAL DATA:
------------------------------------------------------------------------------------------------------------------------
Net assets, end of period, in thousands $267,933 $313,059 $241,025 $230,267 $258,637
------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 255% 164% 95% 149% 63%
------------------------------------------------------------------------------------------------------------------------
</TABLE>

+ Calculated based on the net asset value as of the last business day of
the period.
(1) Does not reflect the effect of expense offset of 0.01%.

<PAGE>

NOTES

-----------------------------------------------------------------------

<PAGE>

NOTES

-----------------------------------------------------------------------

<PAGE>

MORGAN STANLEY DEAN WITTER
FAMILY OF FUNDS

The Morgan Stanley Dean Witter Family of Funds offers
investors a wide range of investment choices. Come on in and
meet the family!

<TABLE>
------------------------------------------------------------------------------------------------------------
<S> <C> <C>
GROWTH FUNDS Aggressive Equity Fund THEME FUNDS
American Opportunities Fund Financial Services Trust
Capital Growth Securities Health Sciences Trust
Developing Growth Securities Information Fund
Growth Fund Natural Resource Development Securities
Market Leader Trust
Mid-Cap Equity Trust GLOBAL/INTERNATIONAL FUNDS
Next Generation Trust Competitive Edge Fund - "Best Ideas"
Small Cap Growth Fund Portfolio
Special Value Fund European Growth Fund
Tax-Managed Growth Fund Fund of Funds - International Portfolio
21st Century Trend Fund International Fund
International SmallCap Fund
Japan Fund
Latin American Growth Fund
Pacific Growth Fund
------------------------------------------------------------------------------------------------------------
GROWTH & INCOME FUNDS Balanced Growth Fund Total Return Trust
Balanced Income Fund Value Fund
Convertible Securities Trust Value-Added Market Series/Equity Portfolio
Dividend Growth Securities
Equity Fund THEME FUNDS
Fund of Funds - Domestic Portfolio Real Estate Fund
Income Builder Fund Utilities Fund
S&P 500 Index Fund
S&P 500 Select Fund GLOBAL FUNDS
Strategist Fund Global Dividend Growth Securities
Total Market Index Fund Global Utilities Fund
------------------------------------------------------------------------------------------------------------
INCOME FUNDS GOVERNMENT INCOME FUNDS GLOBAL INCOME FUNDS
Federal Securities Trust North American Government Income Trust
Short-Term U.S. Treasury Trust World Wide Income Trust
U.S. Government Securities Trust
TAX-FREE INCOME FUNDS
DIVERSIFIED INCOME FUNDS California Tax-Free Income Fund
Diversified Income Trust Hawaii Municipal Trust(FSC)
Limited Term Municipal Trust(NL)
CORPORATE INCOME FUNDS Multi-State Municipal Series Trust(FSC)
High Yield Securities New York Tax-Free Income Fund
Intermediate Income Securities Tax-Exempt Securities Trust
Short-Term Bond Fund(NL)
------------------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS TAXABLE MONEY MARKET FUNDS TAX-FREE MONEY MARKET FUNDS
Liquid Asset Fund(MM) California Tax-Free Daily Income Trust(MM)
U.S. Government Money Market Trust(MM) New York Municipal Money Market Trust(MM)
Tax-Free Daily Income Trust(MM)
------------------------------------------------------------------------------------------------------------
</TABLE>

There may be funds created after this Prospectus was published. Please consult
the inside back cover of a new fund's prospectus for its designation, e.g.,
Multi-Class Fund or Money Market Fund.

Unless otherwise noted, each listed Morgan Stanley Dean Witter Fund, except for
North American Government Income Trust and Short-Term U.S. Treasury Trust, is a
Multi-Class Fund. A Multi-Class Fund is a mutual fund offering multiple Classes
of shares. The other types of funds are: NL -- No-Load (Mutual) Fund; MM --
Money Market Fund; FSC -- A mutual fund sold with a front-end sales charge and
a distribution (12b-1) fee.

<PAGE>

PROSPECTUS - JULY 31, 2000
--------------------------------------------------------------------------------

Additional information about the Fund's investments is available in the Fund's
Annual and Semi-Annual Reports to Shareholders. In the Fund's Annual Report, you
will find a discussion of the market conditions and investment strategies that
significantly affected the Fund's performance during its last fiscal year. The
Fund's Statement of Additional Information also provides additional information
about the Fund. The Statement of Additional Information is incorporated herein
by reference (legally is part of this Prospectus). For a free copy of any of
these documents, to request other information about the Fund, or to make
shareholder inquiries, please call:

(800) 869-NEWS

You also may obtain information about the Fund by calling your Morgan Stanley
Dean Witter Financial Advisor or by visiting our Internet site at:

www.msdw.com/individual/funds

Information about the Fund (including the Statement of Additional Information)
can be viewed and copied at the Securities and Exchange Commission's Public
Reference Room in Washington, DC. Information about the Reference Room's
operations may be obtained by calling the SEC at (202) 942-8090. Reports and
other information about the Fund are available on the EDGAR database on the
SEC's Internet site at (www.sec.gov), and copies of this information may be
obtained, after paying a duplicating fee, by electronic request at the
following E-mail address: [email protected], or by writing the Public
Reference Section of the SEC, Washington, DC 20549-0102

TICKER SYMBOL:

DWSHX

(THE FUND'S INVESTMENT COMPANY ACT FILE NO. IS 811-6330)

Morgan Stanley Dean Witter
---------------------------------------
SHORT-TERM
U.S. TREASURY TRUST

A MUTUAL FUND
THAT SEEKS CURRENT
INCOME, PRESERVATION
OF PRINCIPAL AND LIQUIDITY

<PAGE>

STATEMENT OF ADDITIONAL INFORMATION
MORGAN STANLEY DEAN WITTER
SHORT-TERM U.S. TREASURY TRUST

July 31, 2000

--------------------------------------------------------------------------------

This Statement of Additional Information is not a Prospectus. The
Prospectus (dated July 31, 2000) for Morgan Stanley Dean Witter Short-Term U.S.
Treasury Trust may be obtained without charge from the Fund at its address or
telephone number listed below or from Dean Witter Reynolds at any of its branch
offices.

Morgan Stanley Dean Witter Short-Term U.S. Treasury Trust
Two World Trade Center
New York, New York 10048
(800) 869-NEWS

<PAGE>

TABLE OF CONTENTS
--------------------------------------------------------------------------------

<TABLE>
<S> <C>
I. Fund History ................................................... 4
II. Description of the Fund and Its Investments and Risks .......... 4
A. Classification .............................................. 4
B. Investment Strategies and Risks ............................. 4
C. Fund Policies/Investment Restrictions ....................... 4
III. Management of the Fund ......................................... 5
A. Board of Trustees ........................................... 5
B. Management Information ...................................... 5
C. Compensation ................................................ 10
IV. Control Persons and Principal Holders of Securities ............ 12
V. Investment Management and Other Services ....................... 12
A. Investment Manager .......................................... 12
B. Principal Underwriter ....................................... 12
C. Services Provided by the Investment Manager ................. 13
D. Rule 12b-1 Plan ............................................. 13
E. Other Service Providers ..................................... 15
F. Codes of Ethics ............................................. 16
VI. Brokerage Allocation and Other Practices ....................... 16
A. Brokerage Transactions ...................................... 16
B. Commissions ................................................. 16
C. Brokerage Selection ......................................... 17
D. Directed Brokerage .......................................... 17
E. Regular Broker-Dealers ...................................... 17
VII. Capital Stock and Other Securities ............................. 17
VIII. Purchase, Redemption and Pricing of Shares ..................... 18
A. Purchase/Redemption of Shares ............................... 18
B. Offering Price .............................................. 18
IX. Taxation of the Fund and Shareholders .......................... 19
X. Underwriters ................................................... 20
XI. Calculation of Performance Data ................................ 20
XII. Financial Statements ........................................... 21
</TABLE>

<PAGE>

Glossary of Selected Defined Terms

The terms defined in this glossary are frequently used in this Statement
of Additional Information (other terms used occasionally are defined in the
text of the document).

"Custodian" - The Bank of New York is the Custodian of the Fund's assets.

"Dean Witter Reynolds" - Dean Witter Reynolds Inc., a wholly-owned
broker-dealer subsidiary of MSDW.

"Distributor" - Morgan Stanley Dean Witter Distributors Inc., a
wholly-owned broker-dealer subsidiary of MSDW.

"Financial Advisors" - Morgan Stanley Dean Witter authorized financial
services representatives.

"Fund" - Morgan Stanley Dean Witter Short-Term U.S. Treasury Trust, a
registered open-end investment company.

"Independent Trustees" - Trustees who are not "interested persons" (as
defined by the Investment Company Act) of the Fund.

"Investment Manager" - Morgan Stanley Dean Witter Advisors Inc., a
wholly-owned investment advisor subsidiary of MSDW.

"Morgan Stanley & Co." - Morgan Stanley & Co. Incorporated, a wholly-owned
broker-dealer subsidiary of MSDW.

"Morgan Stanley Dean Witter Funds" - Registered investment companies (i)
for which the Investment Manager serves as the investment advisor and (ii) that
hold themselves out to investors as related companies for investment and
investor services.

"MSDW" - Morgan Stanley Dean Witter & Co., a preeminent global financial
services firm.

"MSDW Services Company" - Morgan Stanley Dean Witter Services Company Inc.,
a wholly-owned fund services subsidiary of the Investment Manager.

"Transfer Agent" - Morgan Stanley Dean Witter Trust FSB, a wholly-owned
transfer agent subsidiary of MSDW.

"Trustees" - The Board of Trustees of the Fund.

<PAGE>

I. FUND HISTORY
--------------------------------------------------------------------------------
The Fund was organized as a Massachusetts business trust, under a
Declaration of Trust, on June 4, 1991 with the name Dean Witter Short-Term U.S.
Treasury Trust. Effective June 22, 1998, the Fund's name was changed to Morgan
Stanley Dean Witter Short-Term U.S. Treasury Trust.

II. DESCRIPTION OF THE FUND AND ITS INVESTMENTS AND RISKS
--------------------------------------------------------------------------------
A. CLASSIFICATION

The Fund is an open-end, diversified management investment company whose
investment objective is to seek current income, preservation of principal and
liquidity.

B. INVESTMENT STRATEGIES AND RISKS

The following discussion of the Fund's investment strategies and risks
should be read with the sections of the Fund's Prospectus titled "Principal
Investment Strategies," "Principal Risks," "Additional Investment Strategy
Information," and "Additional Risk Information."

When-Issued and Delayed Delivery Securities and Firm Commitments. The Fund
may purchase U.S. Treasury securities on a when-issued or delayed delivery
basis or may purchase or sell U.S. Treasury securities on a firm commitment
basis. For example, the Fund may wish to purchase U.S. Treasury notes and bonds
sold at periodic U.S. Treasury auctions prior to their issuance
("when-issued"). When such transactions are negotiated, the price is fixed at
the time of the commitment, but delivery and payment can take place a month or
more after the date of the commitment. While the Fund will only purchase
securities on a when-issued, delayed delivery or firm commitment basis with the
intention of acquiring the securities, the Fund may sell the securities before
the settlement date, if it is deemed advisable. The securities so purchased or
sold are subject to market fluctuation and no interest accrues to the purchaser
during this period. At the time the Fund makes the commitment to purchase or
sell securities on a when-issued, delayed delivery or firm commitment basis, it
will record the transaction and thereafter reflect the value, each day, of such
security purchased or, if a sale, the proceeds to be received, in determining
its net asset value. At the time of delivery of the securities, their value may
be more or less than the purchase or sale price. The Fund will also establish a
segregated account with its custodian bank in which it will continually
maintain cash or cash equivalents or other portfolio (U.S. Treasury) securities
equal in value to commitments to purchase securities on a when issued, delayed
delivery or firm commitment basis.

C. FUND POLICIES/INVESTMENT RESTRICTIONS

The investment objective, policies and restrictions listed below have been
adopted by the Fund as fundamental policies. Under the Investment Company Act
of 1940 (the "Investment Company Act"), a fundamental policy may not be changed
without the vote of a majority of the outstanding voting securities of the
Fund. The Investment Company Act defines a majority as the lesser of (a) 67% or
more of the shares present at a meeting of shareholders, if the holders of 50%
of the outstanding shares of the Fund are present or represented by proxy; or
(b) more than 50% of the outstanding shares of the Fund. For purposes of the
following restrictions: (i) all percentage limitations apply immediately after
a purchase or initial investment; and (ii) any subsequent change in any
applicable percentage resulting from market fluctuations or other changes in
total or net assets does not require elimination of any security from the
portfolio.

The Fund will:

1. Seek current income, preservation of principal and liquidity.

The Fund may not:

1. Invest more than 5% of the value of its total assets in the securities
of any one issuer (other than obligations issued or guaranteed by the
United States Government, its agencies or instrumentalities).

<PAGE>

2. Purchase common stock, preferred stock, warrants, other equity
securities, corporate bonds, municipal bonds or industrial revenue
bonds.

3. Borrow money, except from banks for temporary or emergency purposes,
including the meeting of redemption requests which might otherwise
require the untimely disposition of securities. Borrowing in the
aggregate may not exceed 20%, and borrowing for purposes other than
meeting redemptions may not exceed 5% of the value of the Fund's total
assets (including the amount borrowed), less liabilities (not including
the amount borrowed) at the time the borrowing is made. Borrowings in
excess of 5% will be repaid before additional investments are made.

4. Pledge, hypothecate, mortgage or otherwise encumber its assets, except
in an amount up to 10% of the value of its net assets, but only to
secure permitted borrowings or for temporary or emergency purposes.

5. Sell securities short or purchase securities on margin.

6. Write or purchase put or call options.

7. Underwrite the securities of other issuers or purchase restricted
securities.

8. Purchase or sell real estate, real estate investment trust securities,
commodities or commodity contracts or oil and gas interest.

9. Make loans to others except through the purchase of qualified debt
obligations in accordance with the Funds investment objectives and
policies.

10. Issue senior securities as defined in the Investment Company Act except
insofar as the Fund may be deemed to have issued a senior security by
reason of: (a) borrowing money or (b) purchasing securities on a
when-issued or delayed delivery basis or purchasing or selling
securities on a forward commitment basis.

11. Invest in securities of other investment companies, except as they may
be acquired as part of a merger, consolidation, acquisition of assets or
plan of reorganization.

Notwithstanding any other investment policy or restriction, the Fund may
seek to achieve its investment objective by investing all or substantially all
of its assets in another investment company having substantially the same
investment objective and policies as the Fund.

For the fiscal years ended May 31, 1999 and May 31, 2000 the Fund's
portfolio turnover rates were 164% and 255%, respectively. This variation
resulted from the portfolio manager's response to varying market conditions
during these periods.

III. MANAGEMENT OF THE FUND
--------------------------------------------------------------------------------
A. BOARD OF TRUSTEES

The Board of Trustees of the Fund oversees the management of the Fund but
does not itself manage the Fund. The Trustees review various services provided
by or under the direction of the Investment Manager to ensure that the Fund's
general investment policies and programs are properly carried out. The Trustees
also conduct their review to ensure that administrative services are provided
to the Fund in a satisfactory manner.

Under state law, the duties of the Trustees are generally characterized as
a duty of loyalty and a duty of care. The duty of loyalty requires a Trustee to
exercise his or her powers in the interest of the Fund and not the Trustee's
own interest or the interest of another person or organization. A Trustee
satisfies his or her duty of care by acting in good faith with the care of an
ordinarily prudent person and in a manner the Trustee reasonably believes to be
in the best interest of the Fund and its shareholders.

B. MANAGEMENT INFORMATION

TRUSTEES AND OFFICERS. The Board of the Fund consists of nine (9)
Trustees. These same individuals also serve as directors or trustees for all of
the Morgan Stanley Dean Witter Funds. Six

<PAGE>

Trustees (67% of the total number) have no affiliation or business connection
with the Investment Manager or any of its affiliated persons and do not own any
stock or other securities issued by the Investment Manager's parent company,
MSDW. These are the "non-interested" or "independent" Trustees. The other three
Trustees (the "management Trustees") are affiliated with the Investment
Manager.

The Trustees and executive officers of the Fund, their principal business
occupations during the last five years and their affiliations, if any, with the
Investment Manager, and with the Morgan Stanley Dean Witter Funds (there were
93 such Funds as of the calendar year ended December 31, 1999), are shown
below.

<TABLE>
<CAPTION>
NAME, AGE, POSITION WITH FUND AND ADDRESS PRINCIPAL OCCUPATIONS DURING LAST FIVE YEARS
------------------------------------------- ----------------------------------------------------
<S> <C>
Michael Bozic (59) ........................ Vice Chairman of Kmart Corporation (since
Trustee December 1998); Director or Trustee of the Morgan
c/o Kmart Corporation Stanley Dean Witter Funds; formerly Chairman
3100 West Big Beaver Road and Chief Executive Officer of Levitz Furniture
Troy, Michigan Corporation (November 1995-November 1998) and
President and Chief Executive Officer of Hills
Department Stores (May 1991-July 1995); formerly
variously Chairman, Chief Executive Officer,
President and Chief Operating Officer (1987-1991)
of the Sears Merchandise Group of Sears, Roebuck
and Co.; Director of Weirton Steel Corporation.

Charles A. Fiumefreddo* (67) .............. Chairman, Director or Trustee and Chief Executive
Chairman of the Board, Officer of the Morgan Stanley Dean Witter Funds;
Chief Executive Officer and Trustee formerly Chairman, Chief Executive Officer and
Two World Trade Center Director of the Investment Manager, the Distributor
New York, New York and MSDW Services Company; Executive Vice
President and Director of Dean Witter Reynolds;
Chairman and Director of the Transfer Agent;
formerly Director and/or officer of various MSDW
subsidiaries (until June 1998).

Edwin J. Garn (67) ........................ Director or Trustee of the Morgan Stanley Dean
Trustee Witter Funds; formerly United States Senator (R-
c/o Summit Ventures LLC Utah) (1974-1992) and Chairman, Senate Banking
1 Utah Center Committee (1980-1986); formerly Mayor of Salt
201 S. Main Street Lake City, Utah (1971-1974); formerly Astronaut,
Salt Lake City, Utah Space Shuttle Discovery (April 12-19, 1985); Vice
Chairman, Huntsman Corporation (chemical
company); Director of Franklin Covey (time
management systems), BMW Bank of North
America, Inc. (industrial loan corporation), United
Space Alliance (joint venture between Lockheed
Martin and the Boeing Company) and Nuskin Asia
Pacific (multilevel marketing); member of the Utah
Regional Advisory Board of Pacific Corp.; member
of the board of various civic and charitable
organizations.
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
NAME, AGE, POSITION WITH FUND AND ADDRESS PRINCIPAL OCCUPATIONS DURING LAST FIVE YEARS
------------------------------------------- -----------------------------------------------------
<S> <C>
Wayne E. Hedien (66) ...................... Retired; Director or Trustee of the Morgan Stanley
Trustee Dean Witter Funds; Director of The PMI Group, Inc.
c/o Mayer, Brown & Platt (private mortgage insurance); Trustee and Vice
Counsel to the Independent Trustees Chairman of The Field Museum of Natural History;
1675 Broadway formerly associated with the Allstate Companies
New York, New York (1966-1994), most recently as Chairman of The
Allstate Corporation (March 1993-December 1994)
and Chairman and Chief Executive Officer of its
wholly-owned subsidiary, Allstate Insurance Company
(July 1989-December 1994); director of various other
business and charitable organizations.

James F. Higgins* (52) .................... Chairman of the Private Client Group of MSDW
Trustee (since May 1999); Director of the Transfer Agent
Two World Trade Center and Dean Witter Realty Inc.; Director or Trustee of
New York, New York various Morgan Stanley Dean Witter Funds (since
June 2000); previously President and Chief
Operating Officer of Individual Securities of MSDW
(February 1997-May 1999), President and Chief
Operating Officer of Dean Witter Securities of
MSDW (1995-February 1997), and President and
Chief Operating Officer of Dean Witter Financial
(1989-1995) and Director (1985-1997) of Dean
Witter Reynolds.

Dr. Manuel H. Johnson (51) ................ Senior Partner, Johnson Smick International, Inc.,
Trustee a consulting firm; Co-Chairman and a founder of
c/o Johnson Smick International, Inc. the Group of Seven Council (G7C), an international
1133 Connecticut Avenue, N.W. economic commission; Chairman of the Audit
Washington, D.C. Committee and Director or Trustee of the Morgan
Stanley Dean Witter Funds; Director of Greenwich
Capital Markets, Inc. (broker-dealer), Independence
Standards Board (private sector organization
governing independence of auditors) and NVR,
Inc. (home construction); Chairman and Trustee of
the Financial Accounting Foundation (oversight
organization of the Financial Accounting Standards
Board); formerly Vice Chairman of the Board of
Governors of the Federal Reserve System and
Assistant Secretary of the U.S. Treasury.

Michael E. Nugent (64) .................... General Partner, Triumph Capital, L.P., a private
Trustee investment partnership; Chairman of the Insurance
c/o Triumph Capital, L.P. Committee and Director or Trustee of the Morgan
237 Park Avenue Stanley Dean Witter Funds; formerly Vice President,
New York, New York Bankers Trust Company and BT Capital Corporation
(1984-1988); director of various business
organizations.

Philip J. Purcell* (56) ................... Chairman of the Board of Directors and Chief
Trustee Executive Officer of MSDW, Dean Witter Reynolds
1585 Broadway and Novus Credit Services Inc.; Director of the
New York, New York Distributor; Director or Trustee of the Morgan
Stanley Dean Witter Funds; Director of American
Airlines, Inc. and its parent company, AMR
Corporation; Director and/or officer of various
MSDW subsidiaries.
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
NAME, AGE, POSITION WITH FUND AND ADDRESS PRINCIPAL OCCUPATIONS DURING LAST FIVE YEARS
--------------------------------------------- -----------------------------------------------------
<S> <C>
John L. Schroeder (69) ...................... Retired; Chairman of the Derivatives Committee
Trustee and Director or Trustee of the Morgan Stanley
c/o Mayer, Brown & Platt Dean Witter Funds; Director of Citizens Utilities
Counsel to the Independent Trustees Company (telecommunications, gas, electric
1675 Broadway and water utilities company); formerly Executive
New York, New York Vice President and Chief Investment Officer of
the Home Insurance Company (August 1991-
September 1995).

Mitchell M. Merin (46) ...................... President and Chief Operating Officer of Asset
President Management of MSDW (since December 1998);
Two World Trade Center President and Director (since April 1997) and Chief
New York, New York Executive Officer (since June 1998) of the
Investment Manager and MSDW Services
Company; Chairman, Chief Executive Officer and
Director of the Distributor (since June 1998);
Chairman and Chief Executive Officer (since June
1998) and Director (since January 1998) of the
Transfer Agent; Director of various MSDW
subsidiaries; President of the Morgan Stanley Dean
Witter Funds (since May 1999) Trustee of various
Van Kampen investment companies (since
December 1999); previously Chief Strategic Officer
of the Investment Manager and MSDW Services
Company and Executive Vice President of the
Distributor (April 1997-June 1998), Vice President
of the Morgan Stanley Dean Witter Funds
(May 1997-April 1999), and Executive Vice
President of Dean Witter, Discover & Co.

Barry Fink (45) ............................. General Counsel of Asset Management of MSDW
Vice President, Secretary and General Counsel (since May 2000); Executive Vice President (since
Two World Trade Center December 1999) and Secretary and General
New York, New York Counsel (since February 1997) and Director (since
July 1998) of the Investment Manager and MSDW
Services Company; Vice President, Secretary and
General Counsel of the Morgan Stanley Dean
Witter Funds (since February 1997); Vice President
and Secretary of the Distributor; previously, Senior
Vice President (March 1997-December 1999), First
Vice President, Assistant Secretary and Assistant
General Counsel of the Investment Manager and
MSDW Services Company.

Rajesh K. Gupta (40) ........................ Director of the Taxable Fixed-Income Group and
Vice President Senior Vice President of the Investment Manager;
Two World Trade Center Vice President of various Morgan Stanley Dean
New York, New York Witter Funds.

Sally Sancimino (37) ........................ Vice President of various Morgan Stanley Dean
Vice President Witter Funds.
Two World Trade Center
New York, New York
</TABLE>

<PAGE>

----------
* Denotes Trustees who are "interested persons" of the Fund as defined by the
Investment Company Act.

In addition, Ronald E. Robison, Executive Vice President, Chief
Administrative Officer and Director of the Investment Manager and MSDW Services
Company and President of MSDW Trust, Robert S. Giambrone, Senior Vice President
of the Investment Manager, MSDW Services Company, the Distributor and the
Transfer Agent and Director of the Transfer Agent, Joseph J. McAlinden,
Executive Vice President and Chief Investment Officer of the Investment Manager
and Director of the Transfer Agent, and Peter M. Avelar, Director of the High
Yield Group, Jonathan R. Page, Director of the Money Market Group and James F.
Willison, Director of the Tax-Exempt Fixed Income Group, Senior Vice Presidents
of the Investment Manager are Vice Presidents of the Fund.

In addition, Marilyn K. Cranney, Todd Lebo, Lou Anne D. McInnis, Carsten
Otto and Ruth Rossi, First Vice Presidents and Assistant General Counsels of
the Investment Manager and MSDW Services Company, and Natasha Kassian,
Assistant Vice President and Assistant General Counsel of the Investment
Manager and MSDW Services Company, are Assistant Secretaries of the Fund.

INDEPENDENT DIRECTORS/TRUSTEES AND THE COMMITTEES. Law and regulation
establish both general guidelines and specific duties for the independent
directors/trustees. The Morgan Stanley Dean Witter Funds seek as independent
directors/trustees individuals of distinction and experience in business and
finance, government service or academia; these are people whose advice and
counsel are in demand by others and for whom there is often competition. To
accept a position on the Funds' boards, such individuals may reject other
attractive assignments because the Funds make substantial demands on their
time. All of the independent directors/trustees serve as members of the Audit
Committee. Three of them also serve as members of the Derivatives Committee. In
addition, three of the directors/trustees, including two independent
directors/trustees, serve as members of the Insurance Committee.

The independent directors/trustees are charged with recommending to the
full board approval of management, advisory and administration contracts, Rule
12b-1 plans and distribution and underwriting agreements; continually reviewing
Fund performance; checking on the pricing of portfolio securities, brokerage
commissions, transfer agent costs and performance, and trading among Funds in
the same complex; and approving fidelity bond and related insurance coverage
and allocations, as well as other matters that arise from time to time. The
independent directors/trustees are required to select and nominate individuals
to fill any independent director/trustee vacancy on the board of any Fund that
has a Rule 12b-1 plan of distribution. Most of the Morgan Stanley Dean Witter
Funds have a Rule 12b-1 plan.

The Audit Committee is charged with recommending to the full board the
engagement or discharge of the Fund's independent accountants; directing
investigations into matters within the scope of the independent accountants'
duties, including the power to retain outside specialists; reviewing with the
independent accountants the audit plan and results of the auditing engagement;
approving professional services provided by the independent accountants and
other accounting firms prior to the performance of the services; reviewing the
independence of the independent accountants; considering the range of audit and
non-audit fees; reviewing the adequacy of the Fund's system of internal
controls; and preparing and submitting Committee meeting minutes to the full
board.

The board of each Fund has a Derivatives Committee to approve parameters
for and monitor the activities of the Fund with respect to derivative
investments, if any, made by the Fund.

Finally, the board of each Fund has formed an Insurance Committee to
review and monitor the insurance coverage maintained by the Fund.

<PAGE>

ADVANTAGES OF HAVING SAME INDIVIDUALS AS INDEPENDENT DIRECTORS/TRUSTEES
FOR ALL MORGAN STANLEY DEAN WITTER FUNDS. The independent directors/trustees
and the Funds' management believe that having the same independent
directors/trustees for each of the Morgan Stanley Dean Witter Funds avoids the
duplication of effort that would arise from having different groups of
individuals serving as independent directors/trustees for each of the Funds or
even of sub-groups of Funds. They believe that having the same individuals
serve as independent directors/trustees of all the Funds tends to increase
their knowledge and expertise regarding matters which affect the Fund complex
generally and enhances their ability to negotiate on behalf of each Fund with
the Fund's service providers. This arrangement also precludes the possibility
of separate groups of independent directors/trustees arriving at conflicting
decisions regarding operations and management of the Funds and avoids the cost
and confusion that would likely ensue. Finally, having the same independent
directors/trustees serve on all Fund boards enhances the ability of each Fund
to obtain, at modest cost to each separate Fund, the services of independent
directors/trustees, of the caliber, experience and business acumen of the
individuals who serve as independent directors/trustees of the Morgan Stanley
Dean Witter Funds.

TRUSTEE AND OFFICER INDEMNIFICATION. The Fund's Declaration of Trust
provides that no Trustee, officer, employee or agent of the Fund is liable to
the Fund or to a shareholder, nor is any Trustee, officer, employee or agent
liable to any third persons in connection with the affairs of the Fund, except
as such liability may arise from his/her or its own bad faith, willful
misfeasance, gross negligence or reckless disregard of his/her or its duties.
It also provides that all third persons shall look solely to the Fund property
for satisfaction of claims arising in connection with the affairs of the Fund.
With the exceptions stated, the Declaration of Trust provides that a Trustee,
officer, employee or agent is entitled to be indemnified against all liability
in connection with the affairs of the Fund.

C. COMPENSATION

The Fund pays each Independent Trustee an annual fee of $800 plus a per
meeting fee of $50 for meetings of the Board of Trustees, the Independent
Trustees or Committees of the Board of Trustees attended by the Trustee (the
Fund pays the Chairman of the Audit Committee an additional annual fee of $750,
and the Chairmen of the Derivatives and Insurance Committees additional annual
fees of $500). If a Board meeting and a meeting of the Independent Trustees or
a Committee meeting, or a meeting of the Independent Trustees and/or more than
one Committee meeting, take place on a single day, the Trustees are paid a
single meeting fee by the Fund. The Fund also reimburses such Trustees for
travel and other out-of-pocket expenses incurred by them in connection with
attending such meetings. Trustees and officers of the Fund who are or have been
employed by the Investment Manager or an affiliated company receive no
compensation or expense reimbursement from the Fund for their services as
Trustee.

The following table illustrates the compensation that the Fund paid to its
Independent Trustees for the fiscal year ended May 31, 2000.

FUND COMPENSATION

<TABLE>
<CAPTION>
AGGREGATE
COMPENSATION
NAME OF INDEPENDENT TRUSTEE FROM THE FUND
------------------------------- --------------
<S> <C>
Michael Bozic ................. $1,550
Edwin J. Garn ................. $1,550
Wayne E. Hedien ............... $1,550
Dr. Manuel H. Johnson ......... $2,300
Michael E. Nugent ............. $2,050
John L. Schroeder ............. $2,000
</TABLE>

The following table illustrates the compensation paid to the Fund's
Independent Trustees for the calendar year ended December 31, 1999 for services
to the 93 Morgan Stanley Dean Witter Funds that were in operation at December
31, 1999.

10
<PAGE>

CASH COMPENSATION FROM MORGAN STANLEY DEAN WITTER FUNDS

<TABLE>
<CAPTION>
TOTAL CASH
COMPENSATION
FOR SERVICES TO
93 MORGAN
STANLEY DEAN
NAME OF INDEPENDENT TRUSTEE WITTER FUNDS
------------------------------- ----------------
<S> <C>
Michael Bozic ................. $134,600
Edwin J. Garn ................. 138,700
Wayne E. Hedien ............... 138,700
Dr. Manuel H. Johnson ......... 208,638
Michael E. Nugent ............. 193,324
John L. Schroeder ............. 193,324
</TABLE>

As of the date of this Statement of Additional Information, 55 of the
Morgan Stanley Dean Witter Funds, including the Fund, have adopted a retirement
program under which an independent director/ trustee who retires after serving
for at least five years (or such lesser period as may be determined by the
board) as an independent director/trustee of any Morgan Stanley Dean Witter
Fund that has adopted the retirement program (each such Fund referred to as an
"Adopting Fund" and each such director/ trustee referred to as an "Eligible
Trustee") is entitled to retirement payments upon reaching the eligible
retirement age (normally, after attaining age 72). Annual payments are based
upon length of service.

Currently, upon retirement, each Eligible Trustee is entitled to receive
from the Adopting Fund, commencing as of his or her retirement date and
continuing for the remainder of his or her life, an annual retirement benefit
(the "Regular Benefit") equal to 30.22% of his or her Eligible Compensation
plus 0.5036667% of such Eligible Compensation for each full month of service as
an Independent Director or Trustee of any Adopting Fund in excess of five years
up to a maximum of 60.44% after ten years of service. The foregoing percentages
may be changed by the Board.(1) "Eligible Compensation" is one-fifth of the
total compensation earned by such Eligible Trustee for service to the Adopting
Fund in the five year period prior to the date of the Eligible Trustee's
retirement. Benefits under the retirement program are accrued as expenses on
the books of the Adopting Funds. Such benefits are not secured or funded by the
Adopting Funds.

The following table illustrates the retirement benefits accrued to the
Fund's independent directors/trustees by the Fund for the fiscal year ended May
31, 2000 and by the 55 Morgan Stanley Dean Witter Funds (including the Fund) for
the calendar year ended December 31, 1999, and the estimated retirement benefits
for the independent directors/trustees, to commence upon their retirement, from
the Fund as of the fiscal year ended May 31, 2000 and from the 55 Morgan Stanley
Dean Witter Funds as of the calendar year ended December 31, 1999.

RETIREMENT BENEFITS FROM THE FUND AND ALL MORGAN STANLEY DEAN WITTER FUNDS

<TABLE>
<CAPTION>
FOR ALL ADOPTING FUNDS
------------------------------------------------
ESTIMATED ESTIMATED ESTIMATED ANNUAL
CREDITED YEARS RETIREMENT ESTIMATED RETIREMENT BENEFITS ANNUAL BENEFITS
OF SERVICE AT BENEFITS PERCENTAGE OF ACCRUED AS BENEFITS UPON RETIREMENT
RETIREMENT ACCRUED AS ELIGIBLE EXPENSES BY ALL UPON FROM ALL
NAME OF INDEPENDENT TRUSTEE (MAXIMUM 10) FUND EXPENSES COMPENSATION ADOPTING FUNDS RETIREMENT ADOPTING FUNDS(2)
----------------------------- ---------------- --------------- --------------- -------------------- ----------- ------------------
<S> <C> <C> <C> <C> <C> <C>
Michael Bozic ............... 10 365 60.44% $20,933 907 $50,588
Edwin J. Garn ............... 10 593 60.44 31,737 909 50,675
Wayne E. Hedien ............. 9 692 51.37 39,566 771 43,000
Dr. Manuel H. Johnson........ 10 312 60.44 13,129 1,360 75,520
Michael E. Nugent ........... 10 565 60.44 23,175 1,209 67,209
John L. Schroeder ........... 8 913 50.37 41,558 960 52,994
</TABLE>

----------
(1) An Eligible Trustee may elect alternative payments of his or her retirement
benefits based upon the combined life expectancy of the Eligible Trustee
and his or her spouse on the date of such Eligible Trustee's retirement.
In addition, the Eligible Trustee may elect that the surviving spouse's
periodic payment of benefits will be equal to a lower percentage of the
periodic amount when both spouses were alive. The amount estimated to be
payable under this method, through the remainder of the later of the lives
of the Eligible Trustee and spouse, will be the actuarial equivalent of
the Regular Benefit.

(2) Based on current levels of compensation. Amount of annual benefits also
varies depending on the Trustee's elections described in Footnote (1).

<PAGE>

IV. CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES
--------------------------------------------------------------------------------

The following owned 5% or more of the outstanding shares of the Fund as of
July 7, 2000: City of Chicago FND 235, ATTN: Treasurer's Office, City Hall Room
204, Chicago, IL 60602 - 9.910%.

As of the date of this Statement of Additional Information, the aggregate
number of shares of beneficial interest of the Fund owned by the Fund's
officers and Trustees as a group was less than 1% of the Fund's shares of
beneficial interest outstanding.

V. INVESTMENT MANAGEMENT AND OTHER SERVICES
--------------------------------------------------------------------------------
A. INVESTMENT MANAGER

The Investment Manager to the Fund is Morgan Stanley Dean Witter Advisors
Inc., a Delaware corporation, whose address is Two World Trade Center, New
York, NY 10048. The Investment Manager is a wholly-owned subsidiary of MSDW, a
Delaware corporation. MSDW is a preeminent global financial services firm that
maintains leading market positions in each of its three primary businesses:
securities, asset management and credit services.

Pursuant to an Investment Management Agreement (the "Management
Agreement") with the Investment Manager, the Fund has retained the Investment
Manager to provide administrative services and manage the investment of the
Fund's assets, including the placing of orders for the purchase and sale of
portfolio securities. The Fund pays the Investment Manager monthly compensation
calculated daily by applying the annual rate of 0.35% to the net assets of the
Fund determined as of the close of each business day.

For the fiscal years ended May 31, 1998, 1999 and 2000, the Investment
Manager accrued total compensation under the Management Agreement in the
amounts of $841,955, $1,081,244 and $1,006,144, respectively.

The Investment Manager has retained its wholly-owned subsidiary, MSDW
Services Company, to perform administrative services for the Fund.

B. PRINCIPAL UNDERWRITER

The Fund's principal underwriter is the Distributor (which has the same
address as the Investment Manager). In this capacity, the Fund's shares are
distributed by the Distributor. The Distributor has entered into a selected
dealer agreement with Dean Witter Reynolds, which through its own sales
organization sells shares of the Fund. In addition, the Distributor may enter
into similar agreements with other selected broker-dealers. The Distributor, a
Delaware corporation, is a wholly-owned subsidiary of MSDW.

The Distributor bears all expenses it may incur in providing services
under the Distribution Agreement. These expenses include the payment of
commissions for sales of the Fund's shares and incentive compensation to
Financial Advisors, the cost of educational and/or business-related trips, and
educational and/or promotional and business-related expenses. The Distributor
also pays certain expenses in connection with the distribution of the Fund's
shares, including the costs of preparing, printing and distributing advertising
or promotional materials, and the costs of printing and distributing
prospectuses and supplements thereto used in connection with the offering and
sale of the Fund's shares. The Fund bears the costs of initial typesetting,
printing and distribution of prospectuses and supplements thereto to
shareholders. The Fund also bears the costs of registering the Fund and its
shares under federal and state securities laws and pays filing fees in
accordance with state securities laws.

The Fund and the Distributor have agreed to indemnify each other against
certain liabilities, including liabilities under the Securities Act. Under the
Distribution Agreement, the Distributor uses its

<PAGE>

best efforts in rendering services to the Fund, but in the absence of willful
misfeasance, bad faith, gross negligence or reckless disregard of its
obligations, the Distributor is not liable to the Fund or any of its
shareholders for any error of judgment or mistake of law or for any act or
omission or for any losses sustained by the Fund or its shareholders.

C. SERVICES PROVIDED BY THE INVESTMENT MANAGER

The Investment Manager manages the investment of the Fund's assets,
including the placing of orders for the purchase and sale of portfolio
securities. The Investment Manager obtains and evaluates the information and
advice relating to the economy, securities markets, and specific securities as
it considers necessary or useful to continuously manage the assets of the Fund
in a manner consistent with its investment objective.

Under the terms of the Management Agreement, in addition to managing the
Fund's investments, the Investment Manager maintains certain of the Fund's
books and records and furnishes, at its own expense, the office space,
facilities, equipment, clerical help, bookkeeping and certain legal services as
the Fund may reasonably require in the conduct of its business, including the
preparation of prospectuses, proxy statements and reports required to be filed
with federal and state securities commissions (except insofar as the
participation or assistance of independent accountants and attorneys is, in the
opinion of the Investment Manager, necessary or desirable). In addition, the
Investment Manager pays the salaries of all personnel, including officers of
the Fund, who are employees of the Investment Manager. The Investment Manager
also bears the cost of telephone service, heat, light, power and other
utilities provided to the Fund.

Expenses not expressly assumed by the Investment Manager under the
Management Agreement or by the Distributor, will be paid by the Fund. These
expenses include, but are not limited to: fees pursuant to the Fund's 12b-1
Plan; charges and expenses of any registrar, custodian, stock transfer and
dividend disbursing agent; brokerage commissions; taxes; engraving and printing
share certificates; registration costs of the Fund and its shares under federal
and state securities laws; the cost and expense of printing, including
typesetting, and distributing prospectuses of the Fund and supplements thereto
to the Fund's shareholders; all expenses of shareholders' and Trustees'
meetings and of preparing, printing and mailing of proxy statements and reports
to shareholders; fees and travel expenses of Trustees or members of any
advisory board or committee who are not employees of the Investment Manager or
any corporate affiliate of the Investment Manager; all expenses incident to any
dividend, withdrawal or redemption options; charges and expenses of any outside
service used for pricing of the Fund's shares; fees and expenses of legal
counsel, including counsel to the Trustees who are not interested persons of
the Fund or of the Investment Manager (not including compensation or expenses
of attorneys who are employees of the Investment Manager); fees and expenses of
the Fund's independent accountants; membership dues of industry associations;
interest on Fund borrowings; postage; insurance premiums on property or
personnel (including officers and Trustees) of the Fund which inure to its
benefit; extraordinary expenses (including, but not limited to, legal claims
and liabilities and litigation costs and any indemnification relating thereto);
and all other costs of the Fund's operation.

The Management Agreement provides that in the absence of willful
misfeasance, bad faith, gross negligence or reckless disregard of its
obligations thereunder, the Investment Manager is not liable to the Fund or any
of its investors for any act or omission by the Investment Manager or for any
losses sustained by the Fund or its investors.

The Management Agreement will remain in effect from year to year, provided
continuance of the Management Agreement is approved at least annually by the
vote of the holders of a majority, as defined in the Investment Company Act, of
the outstanding shares of the Fund, or by the Trustees; provided that in either
event such continuance is approved annually by the vote of a majority of the
Trustees, including a majority of the Independent Trustees.

D. RULE 12b-1 PLAN

In accordance with a Plan of Distribution pursuant to Rule 12b-1 under the
Investment Company Act between the Fund and the Distributor, the Distributor
provides certain services in connection with the promotion of sales of Fund
shares (the "Plan").

<PAGE>

The Investment Manager pays a retention fee to Morgan Stanley Dean Witter
Financial Advisors at an annual rate of 0.05% of the value of shares of the
Fund sold after January 1, 2000 and held for at least one year. Shares
purchased through the reinvestment of dividends will be eligible for a
retention fee, provided that such dividends were earned on shares otherwise
eligible for a retention fee payment. Shares owned in variable annuities,
closed-end fund shares and shares held in 401(k) plans where the Transfer Agent
or MSDW's Retirement Plan Services is either recordkeeper or trustee are not
eligible for a retention fee.

For the first year only, the retention fee is paid on any shares of the
Fund sold after January 1, 2000 and held by shareholders on December 31, 2000.

The retention fees are paid by the Investment Manager from its own assets,
which may include profits from investment management fees payable under the
Investment Management Agreement, as well as from borrowed funds.

The Plan provides that the Distributor bears the expense of all
promotional and distribution related activities on behalf of the Fund, except
for expenses that the Trustees determine to reimburse, as described below. The
following activities and services may be provided by the Distributor under the
Plan: (1) compensation to and expenses of Dean Witter Reynolds' Financial
Advisors and other Selected Broker-Dealers' account executives and other
employees, including overhead and telephone expenses; (2) sales incentives and
bonuses to sales representatives and to marketing personnel in connection with
promoting sales of the Fund's shares; (3) expenses incurred in connection with
promoting sales of the Fund's shares; (4) preparing and distributing sales
literature; and (5) providing advertising and promotional activities, including
direct mail solicitation and television, radio, newspaper, magazine and other
media advertisements.

The Fund is authorized to reimburse specific expenses incurred or to be
incurred in promoting the distribution of the Fund's shares. Reimbursement is
made through payments at the end of each month. The amount of each monthly
payment may in no event exceed an amount equal to a payment at the annual rate
of 0.35 of 1% of the Fund's average daily net assets during the month. No
interest or other financing charges will be incurred for which reimbursement
payments under the Plan will be made. In addition, no interest charges, if any,
incurred on any distribution expenses will be reimbursable under the Plan. In
the case of all expenses other than expenses representing a residual to
Financial Advisors and other authorized financial representatives, such amounts
shall be determined at the beginning of each calendar quarter by the trustees,
including a majority of the Independent 12b-1 Trustees. Expenses representing a
residual to Financial Advisors and other authorized financial representatives,
may be reimbursed without prior determination. In the event that the
Distributor proposes that monies shall be reimbursed for other than such
expenses, then in making quarterly determinations of the amounts that may be
expended by the Fund, the Investment Manager provides and the Trustees review a
quarterly budget of projected incremental distribution expenses to be incurred
on behalf of the Fund, together with a report explaining the purposes and
anticipated benefits of incurring such expenses. The Trustees determine which
particular expenses, and the portions thereof, that may be borne by the Fund,
and in making such a determination shall consider the scope of the
Distributor's commitment to promoting the distribution of the Fund's shares.

The Fund accrued a total of $965,358 which amounts to a rate of 0.34%,
pursuant to the Plan of Distribution for the fiscal year ended May 31, 2000. It
is estimated that the amounts paid by the Fund for distribution were for
expenses which relate to compensation of sales personnel and associated
overhead expenses.

Under the Plan, the Distributor uses its best efforts in rendering
services to the Fund, but in the absence of willful misfeasance, bad faith,
gross negligence or reckless disregard of its obligations, the Distributor is
not liable to the Fund or any of its shareholders for any error of judgment or
mistake of law or for any act or omission or for any losses sustained by the
Fund or its shareholders.

Under the Plan, the Distributor provides the Fund, for review by the
Trustees, and the Trustees review, promptly after the end of each calendar
quarter, a written report regarding the incremental

<PAGE>

distribution expenses incurred on behalf of the Fund during such calendar
quarter, which report includes (1) an itemization of the types of expenses and
the purposes therefore; (2) the amounts of such expenses; and (3) a description
of the benefits derived by the Fund. In the Trustees' quarterly review of the
Plan they consider its continued appropriateness and the level of compensation
provided therein.

No interested person of the Fund nor any Independent Trustee has any
direct financial interest in the operation of the Plan except to the extent
that the Distributor, the Investment Manager, Dean Witter Reynolds, MSDW
Services Company or certain of their employees may be deemed to have such an
interest as a result of benefits derived from the successful operation of the
Plan or as a result of receiving a portion of the amounts expended thereunder
by the Fund.

On an annual basis, the Trustees, including a majority of the Independent
Trustees, consider whether the Plan should be continued. Prior to approving the
last continuation of the Plan, the Trustees requested and received from the
Distributor and reviewed all the information which they deemed necessary to
arrive at an informed determination. In making their determination to continue
the Plan, the Trustees considered: (1) the Fund's experience under the Plan and
whether such experience indicates that the Plan is operating as anticipated;
(2) the benefits the Fund had obtained, was obtaining and would be likely to
obtain under the Plan, including that the Plan is essential in order to enable
the Fund to continue to grow and avoid a pattern of net redemptions which, in
turn, is essential for effective investment management; and without the
compensation to individual brokers and the reimbursement of distribution and
account maintenance expenses of Dean Witter Reynolds's branch offices made
possible by the 12b-1 fees, Dean Witter Reynolds could not establish and
maintain an effective system for distribution, servicing of Fund shareholders
and maintenance of shareholder accounts; and (3) what services had been
provided and were continuing to be provided under the Plan to the Fund and its
shareholders. Based upon their review, the Trustees, including each of the
Independent Trustees, determined that continuation of the Plan would be in the
best interest of the Fund and would have a reasonable likelihood of continuing
to benefit the Fund and its shareholders. In the Trustees' quarterly review of
the Plan, they will consider its continued appropriateness and the level of
compensation provided therein.

The Plan may not be amended to increase materially the amount to be spent
for the services described therein without approval by the shareholders of the
Fund, and all material amendments to the Plan must also be approved by the
Trustees. The Plan may be terminated at any time, without payment of any
penalty, by vote of a majority of the Independent Trustees or by a vote of a
majority of the outstanding voting securities of the Fund (as defined in the
Investment Company Act) on not more than thirty days' written notice to any
other party to the Plan. So long as the Plan is in effect, the election and
nomination of Independent Trustees shall be committed to the discretion of the
Independent Trustees.

E. OTHER SERVICE PROVIDERS

(1) TRANSFER AGENT/DIVIDEND-PAYING AGENT

Morgan Stanley Dean Witter Trust FSB is the Transfer Agent for the Fund's
shares and the Dividend Disbursing Agent for payment of dividends and
distributions on Fund shares and Agent for shareholders under various
investment plans. The principal business address of the Transfer Agent is
Harborside Financial Center, Plaza Two, Jersey City, NJ 07311.

(2) CUSTODIAN AND INDEPENDENT ACCOUNTANTS

The Bank of New York, 100 Church Street, New York, NY 10007 is the
Custodian for the Fund's assets. Any of the Fund's cash balances with the
Custodian in excess of $100,000 are unprotected by federal deposit insurance.
These balances may, at times, be substantial.

PricewaterhouseCoopers LLP, 1177 Avenue of the Americas, New York, NY
10036 served as the independent accountants of the Fund for the fiscal year
ended May 31, 2000. Effective July 1, 2000, PricewaterhouseCoopers LLP resigned
and Deloitte & Touche LLP, Two World Financial Center, New York, NY 10281 was
appointed the independent accountants for the Fund. The independent accountants
are responsible for auditing the annual financial statements of the Fund.

<PAGE>

(3) Affiliated Persons

The Transfer Agent is an affiliate of the Investment Manager, and of the
Distributor. As Transfer Agent and Dividend Disbursing Agent, the Transfer
Agent's responsibilities include maintaining shareholder accounts, disbursing
cash dividends and reinvesting dividends, processing account registration
changes, handling purchase and redemption transactions, mailing prospectuses
and reports, mailing and tabulating proxies, processing share certificate
transactions, and maintaining shareholder records and lists. For these
services, the Transfer Agent receives a per shareholder account fee from the
Fund and is reimbursed for its out-of-pocket expenses in connection with such
services.

F. CODES OF ETHICS

The Fund, the Investment Manager and the Distributor have each adopted a
Code of Ethics pursuant to Rule 17j-1 under the Investment Company Act. The
Codes of Ethics are designed to detect and prevent improper personal trading.
The Codes of Ethics permit personnel subject to the Codes to invest in
securities, including securities that may be purchased, sold or held by the
Fund, subject to a number of restrictions and controls including prohibitions
against purchases of securities in an Initial Public Offering and a
preclearance requirement with respect to personal securities transactions.

VI. BROKERAGE ALLOCATION AND OTHER PRACTICES
--------------------------------------------------------------------------------
A. BROKERAGE TRANSACTIONS

Subject to the general supervision of the Board of Trustees, the
Investment Manager is responsible for decisions to buy and sell securities for
the Fund, the selection of brokers and dealers to effect the transactions, and
the negotiation of brokerage commissions, if any. Purchases and sales of
portfolio securities are normally transacted through issuers, underwriters or
major dealers in U.S. Government securities acting as principals. Such
transactions are made on a net basis and do not involve payment of brokerage
commissions. The cost of securities purchased from an underwriter usually
includes a commission paid by the issuer to the underwriters; transactions with
dealers normally reflect the spread between bid and asked prices.

During the fiscal years ended May 31, 1998, 1999 and 2000, the Fund paid
no such brokerage commissions or concessions.

B. COMMISSIONS

Pursuant to an order of the SEC, the Fund may effect principal
transactions in certain money market instruments with Dean Witter Reynolds. The
Fund will limit its transactions with Dean Witter Reynolds to U.S. The
transactions will be effected with Dean Witter Reynolds only when the price
available from Dean Witter Reynolds is better than that available from other
dealers.

During the fiscal years ended May 31, 1998, 1999 and 2000, the Fund did
not effect any principal transactions with Dean Witter Reynolds.

Brokerage transactions in securities listed on exchanges or admitted to
unlisted trading privileges may be effected through Dean Witter Reynolds,
Morgan Stanley & Co. and other affiliated brokers and dealers. In order for an
affiliated broker or dealer to effect any portfolio transactions on an exchange
for the Fund, the commissions, fees or other remuneration received by the
affiliated broker or dealer must be reasonable and fair compared to the
commissions, fees or other remuneration paid to other brokers in connection
with comparable transactions involving similar securities being purchased or
sold on an exchange during a comparable period of time. This standard would
allow the affiliated broker or dealer to receive no more than the remuneration
which would be expected to be received by an unaffiliated broker in a
commensurate arm's-length transaction. Furthermore, the Trustees, including the
Independent Trustees, have adopted procedures which are reasonably designed to
provide that any commissions, fees or other remuneration paid to an affiliated
broker or dealer are consistent with the foregoing standard. The Fund does not
reduce the management fee it pays to the Investment Manager by any amount of
the brokerage commissions it may pay to an affiliated broker or dealer.

<PAGE>

During the fiscal years ended May 31, 1998, 1999 and 2000, the Fund paid
no brokerage commissions to an affiliated broker or dealer.

C. BROKERAGE SELECTION

The policy of the Fund regarding purchases and sales of securities for its
portfolio is that primary consideration will be given to obtaining the most
favorable prices and efficient executions of transactions.

In seeking to implement the Fund's policies, the Investment Manager
effects transactions with those brokers and dealers who the Investment Manager
believes provide the most favorable prices and are capable of providing
efficient executions. If the Investment Manager believes the prices and
executions are obtainable from more than one broker or dealer, it may give
consideration to placing portfolio transactions with those brokers and dealers
who also furnish research and other services to the Fund or the Investment
Manager. The services may include, but are not limited to, any one or more of
the following: information as to the availability of securities for purchase or
sale; statistical or factual information or opinions pertaining to investment;
wire services; and appraisals or evaluations of portfolio securities.

The information and services received by the Investment Manager from
brokers and dealers may be of benefit to the Investment Manager in the
management of accounts of some of its other clients and may not in all cases
benefit the Fund directly. While the receipt of such information and services
is useful in varying degrees and would generally reduce the amount of research
or services otherwise performed by the Investment Manager and thereby reduce
its expenses, it is of indeterminable value and the Fund does not reduce the
management fee it pays to the Investment Manager by any amount that may be
attributable to the value of such services.

The Investment Manager currently serves as investment manager to a number
of clients, including other investment companies, and may in the future act as
investment manager or advisor to others. It is the practice of the Investment
Manager to cause purchase and sale transactions to be allocated among the Fund
and others whose assets it manages in such manner as it deems equitable. In
making such allocations among the Fund and other client accounts, various
factors may be considered, including the respective investment objectives, the
relative size of portfolio holdings of the same or comparable securities, the
availability of cash for investment, the size of investment commitments
generally held and the opinions of the persons responsible for managing the
portfolios of the Fund and other client accounts. In the case of certain
initial and secondary public offerings, the Investment Manager utilizes a pro
rata allocation process based on the size of the relevant funds and/or client
accounts involved and the number of shares available from the public offering.

D. DIRECTED BROKERAGE

During the fiscal year ended May 31, 2000, the Fund did not pay any
brokerage commissions to brokers because of research services provided.

E. REGULAR BROKER-DEALERS

During the fiscal year ended May 31, 2000, the Fund did not purchase
securities issued by brokers or dealers that were among the ten brokers or the
ten dealers which executed transactions for or with the Fund in the largest
dollar amounts during the year. At May 31, 2000, the Fund did not own any
securities issued by any of such issuers.

VII. CAPITAL STOCK AND OTHER SECURITIES
--------------------------------------------------------------------------------
The shareholders of the Fund are entitled to a full vote for each full
share of beneficial interest held. The Fund is authorized to issue an unlimited
number of shares of beneficial interest. All shares of beneficial interest of
the Fund are of $0.01 par value and are equal as to earnings, assets and voting
privileges.

<PAGE>

The Fund's Declaration of Trust permits the Trustees to authorize the
creation of additional series of shares (the proceeds of which would be
invested in separate, independently managed portfolios) and additional Classes
of shares within any series. The Trustees have not presently authorized any
such additional series or Classes of shares other than as set forth in the
Prospectus.

The Fund is not required to hold annual meetings of shareholders and in
ordinary circumstances the Fund does not intend to hold such meetings. The
Trustees may call special meetings of shareholders for action by shareholder
vote as may be required by the Investment Company Act or the Declaration of
Trust. Under certain circumstances the Trustees may be removed by the actions
of the Trustees. In addition, under certain circumstances the shareholders may
call a meeting to remove Trustees and the Fund is required to provide
assistance in communicating with shareholders about such a meeting. The voting
rights of shareholders are not cumulative, so that holders of more than 50
percent of the shares voting can, if they choose, elect all Trustees being
selected, while the holders of the remaining shares would be unable to elect
any Trustees.

Under Massachusetts law, shareholders of a business trust may, under
certain limited circumstances, be held personally liable as partners for the
obligations of the Fund. However, the Declaration of Trust contains an express
disclaimer of shareholder liability for acts or obligations of the Fund,
requires that notice of such Fund obligations include such disclaimer, and
provides for indemnification out of the Fund's property for any shareholder
held personally liable for the obligations of the Fund. Thus, the risk of a
shareholder incurring financial loss on account of shareholder liability is
limited to circumstances in which the Fund itself would be unable to meet its
obligations. Given the above limitations on shareholder personal liability, and
the nature of the Fund's assets and operations, the possibility of the Fund
being unable to meet its obligations is remote and thus, in the opinion of
Massachusetts counsel to the Fund, the risk to Fund shareholders of personal
liability is remote.

All of the Trustees except for James F. Higgins have been elected by the
shareholders of the Fund, most recently at a Special Meeting of Shareholders
held on May 21, 1997. The Trustees themselves have the power to alter the
number and the terms of office of the Trustees (as provided for in the
Declaration of Trust), and they may at any time lengthen or shorten their own
terms or make their terms of unlimited duration and appoint their own
successors, provided that always at least a majority of the Trustees has been
elected by the shareholders of the Fund.

VIII. PURCHASE, REDEMPTION AND PRICING OF SHARES
--------------------------------------------------------------------------------
A. PURCHASE/REDEMPTION OF SHARES

Information concerning how Fund shares are offered to the public (and how
they are redeemed and exchanged) is provided in the Fund's Prospectus.

TRANSFER AGENT AS AGENT. With respect to the redemption or repurchase of
Fund shares, the application of proceeds to the purchase of new shares in the
Fund or any other Morgan Stanley Dean Witter Funds and the general
administration of the exchange privilege, the Transfer Agent acts as agent for
the Distributor and for the shareholder's authorized broker-dealer, if any, in
the performance of such functions. With respect to exchanges, redemptions or
repurchases, the Transfer Agent shall be liable for its own negligence and not
for the default or negligence of its correspondents or for losses in transit.
The Fund shall not be liable for any default or negligence of the Transfer
Agent, the Distributor or any authorized broker-dealer.

The Distributor and any authorized broker-dealer have appointed the
Transfer Agent to act as their agent in connection with the application of
proceeds of any redemption of Fund shares to the purchase of shares of any
other Morgan Stanley Dean Witter Fund and the general administration of the
exchange privilege. No commission or discounts will be paid to the Distributor
or any authorized broker-dealer for any transaction pursuant to the exchange
privilege.

B. OFFERING PRICE

The price of Fund shares, called "net asset value," is based on the value
of the Fund's portfolio securities.

<PAGE>

The net asset value per share of the Fund is determined by taking the
value of all the assets of the Fund, subtracting all liabilities, dividing by
the number of shares outstanding and adjusting the result to nearest cent. The
net asset value per share is determined by the Investment Manager as of 4:00
p.m. New York time on each day that the New York Stock Exchange is open (or, on
days when the New York Stock Exchange closes prior to 4:00 p.m., at such
earlier time). The net asset value per share will not be determined on Good
Friday and on such other federal and non-federal holidays as are observed by
the New York Stock Exchange.

In the calculation of the Fund's net asset value: (1) all portfolio
securities for which over-the-counter market quotations are readily available
are valued at the bid price; and (2) when market quotations are not readily
available, including circumstances under which it is determined by the
Investment Manager that sale or bid prices are not reflective of a security's
market value, portfolio securities are valued at their fair value as determined
in good faith under procedures established by and under the general supervision
of the Fund's Board of Trustees (valuation of securities for which market
quotations are not readily available may be based upon current market prices of
securities which are comparable in coupon, rating and maturity or an
appropriate matrix utilizing similar factors).

Short-term taxable debt securities with remaining maturities of 60 days or
less at time of purchase are valued at amortized cost, unless the Board
determines such does not reflect the securities' market value, in which case
these securities will be valued at their fair value as determined by the Board
of Trustees. Other taxable short-term debt securities with maturities of more
than 60 days will be valued on a mark to market basis until such time as they
reach a maturity of 60 days, whereupon they will be valued at amortized cost
using their value on the 61st day unless the Trustees determine such does not
reflect the securities' fair value, in which case these securities will be
valued at their fair market value as determined by the Board of Trustees.

IX. TAXATION OF THE FUND AND SHAREHOLDERS
--------------------------------------------------------------------------------

The Fund generally will make two basic types of distributions: ordinary
dividends and long-term capital gain distributions. These two types of
distributions are reported differently on a shareholder's income tax return and
they are also subject to different rates of tax. The tax treatment of the
investment activities of the Fund will affect the amount and timing and
character of the distributions made by the Fund. Tax issues relating to the
Fund are not generally a consideration for shareholders such as tax- exempt
entities and tax-advantaged retirement vehicles such as an IRA or 401(k) plan.
Shareholders are urged to consult their own tax professionals regarding
specific questions as to federal, state or local taxes.

INVESTMENT COMPANY TAXATION. The Fund intends to remain qualified as a
regulated investment company under Subchapter M of the Internal Revenue Code of
1986. As such, the Fund will not be subject to federal income tax on its net
investment income and capital gains, if any, to the extent that it distributes
such income and capital gains to its shareholders.

The Fund generally intends to distribute sufficient income and gains so
that the Fund will not pay corporate income tax on its earnings. The Fund also
generally intends to distribute to its shareholders in each calendar year a
sufficient amount of ordinary income and capital gains to avoid the imposition
of a 4% excise tax. However, the Fund may instead determine to retain all or
part of any net long-term capital gains in any year for reinvestment. In such
event, the Fund will pay federal income tax (and possibly excise tax) on such
retained gains.

Gains or losses on sales of securities by the Fund will be long-term
capital gains or losses if the securities have a tax holding period of more
than one year. Gains or losses on the sale of securities with a tax holding
period of one year or less will be short-term gains or losses.

Under certain tax rules, the Fund may be required to accrue a portion of
any discount at which certain securities are purchased as income each year even
though the Fund receives no payments in cash on the security during the year.
To the extent that the Fund invests in such securities, it would be required to
pay out such accrued discount as an income distribution in each year in order
to avoid taxation at the Fund level. Such distributions will be made from the
available cash of the Fund or by

<PAGE>

liquidation of portfolio securities if necessary. If a distribution of cash
necessitates the liquidation of portfolio securities, the Investment Manager
will select which securities to sell. The Fund may realize a gain or loss from
such sales. In the event the Fund realizes net capital gains from such
transactions, its shareholders may receive a larger capital gain distribution,
if any, than they would in the absence of such transactions.

TAXATION OF DIVIDENDS AND DISTRIBUTIONS-Federal Taxes. Shareholders
normally will have to pay federal income taxes on the dividends and other
distributions they receive from the Fund. Such dividends and distributions, to
the extent that they are derived from net investment income or short-term
capital gains, are taxable to the shareholder as ordinary income regardless of
whether the shareholder receives such payments in additional shares or in cash.

Distributions of net long-term capital gains, if any, are taxable to
shareholders as long-term capital gains regardless of how long a shareholder
has held the Fund's shares and regardless of whether the distribution is
received in additional shares or in cash. The maximum tax rate on long-term
capital gains realized by non-corporate shareholders is 20%.

Shareholders are generally taxed on any ordinary dividend or capital gain
distributions from the Fund in the year they are actually distributed. However,
if any such dividends or distributions are declared in October, November or
December and paid in January then such amounts will be treated for tax purposes
as received by the shareholders on December 31, to shareholders of record of
such month.

Shareholders who are not citizens or residents of the United States and
certain foreign entities may be subject to withholding of United States tax on
distributions made by the Fund of investment income and short-term capital
gains.

State and Local Taxes. Because all States presently allow the pass-through
of federal obligation interest derived from specific federal obligations, it is
anticipated that substantially all of the interest income generated by the Fund
and paid out to shareholders as net investment income will be exempt from the
taxation of most state and local jurisdictions. Furthermore, any capital gains
realized by the Fund will not be exempt from state and local taxes. It should
be noted that although the Fund intends to invest only in securities the
pass-through income from which is believed exempt from state and local income
taxes, it is possible that a state or local taxing authority may seek to tax an
investor on a portion of the interest income of a particular government
obligation held by the Fund.

After the end of each calendar year, shareholders will be sent information
on their dividends and capital gain distributions for tax purposes, including
the portion taxable as ordinary income and the portion taxable as long-term
capital gains.

X. UNDERWRITERS
--------------------------------------------------------------------------------

The Fund's shares are offered to the public on a continuous basis. The
Distributor, as the principal underwriter of the shares, has certain
obligations under the Distribution Agreement concerning the distribution of the
shares. These obligations and the compensation the Distributor receives are
described above in the sections titled "Principal Underwriter" and "Rule 12b-1
Plan."

XI. CALCULATION OF PERFORMANCE DATA
--------------------------------------------------------------------------------
From time to time the Fund may quote its "yield" and/or its "total return"
in advertisements and sales literature.

Yield is calculated for any 30-day period as follows: the amount of
interest income for each security in the Fund's portfolio is determined as
described below; the total for the entire portfolio constitutes the Fund's
gross income for the period. Expenses accrued during the period are subtracted
to arrive at "net investment income." The resulting amount is divided by the
product of the maximum offering price per share on the last day of the period
(reduced by any undeclared earned income per share that is expected to be
declared shortly after the end of the period) multiplied by the average number
of Fund shares

20
<PAGE>

outstanding during the period that were entitled to dividends. This amount is
added to 1 and raised to the sixth power. 1 is then subtracted from the result
and the difference is multiplied by 2 to arrive at the annualized yield. Based
on this calculation, the Fund's annualized yield for the 30-day period ended
May 31, 2000 was 5.90%.

The Fund's "average annual total return" represents an annualization of
the Fund's total return over a particular period and is computed by finding the
annual percentage rate which will result in the ending redeemable value of a
hypothetical $1,000 investment made at the beginning of a one, five or ten year
period, or for the period from the date of commencement of the Fund's
operations, if shorter than any of the foregoing. For the purpose of this
calculation, it is assumed that all dividends and distributions are reinvested.
The formula for computing the average annual total return involves a percentage
obtained by dividing the ending redeemable value by the amount of the initial
investment, taking a root of the quotient (where the root is equivalent to the
number of years in the period) and subtracting 1 from the result. Based on this
calculation, the average annual total returns of the Fund for the one and five
year periods ended May 31, 2000 and for the period August 13, 1991
(commencement of operations) through May 31, 2000 were 2.83%, 4.74% and 4.92%,
respectively.

In addition, the Fund may compute its aggregate total return for specified
periods by determining the aggregate percentage rate which will result in the
ending value of a hypothetical $1,000 investment made at the beginning of the
period. For the purpose of this calculation, it is assumed that all dividends
and distributions are reinvested. The formula for computing aggregate total
return involves a percentage obtained by dividing the ending value by the
initial $1,000 investment and subtracting 1 from the result. The Fund's total
returns for the one and five year periods ended May 31, 2000 and for the period
August 13, 1991 (commencement of operations) through May 31, 2000 were 2.83%,
26.05% and 52.65%, respectively.

The Fund may also advertise the growth of hypothetical investments of
$10,000, $50,000 and $100,000 in shares of the Fund by adding 1 to the Fund's
aggregate total return to date and multiplying by $10,000, $50,000 or $100,000,
respectively. Investments of $10,000, $50,000 and $100,000 in the Fund since
inception would have grown to $15,265, $76,325, and $152,650, respectively, at
May 31, 2000.

The Fund from time to time may also advertise its performance relative to
certain performance rankings and indices compiled by recognized organizations.

XII. FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

EXPERTS. The financial statements of the Fund for the fiscal year ended
May 31, 2000 included in this Statement of Additional Information and
incorporated by reference in the Prospectus are included herein in reliance on
the report of PricewaterhouseCoopers LLP, independent accountants, given on the
authority of said firm as experts in auditing and accounting.

* * * * *

This Statement of Additional Information and the Prospectus do not contain
all of the information set forth in the Registration Statement the Fund has
filed with the SEC. The complete Registration Statement may be obtained from
the SEC.

<PAGE>

MORGAN STANLEY DEAN WITTER SHORT-TERM U.S. TREASURY TRUST
PORTFOLIO OF INVESTMENTS May 31, 2000

<TABLE>
<CAPTION>
PRINCIPAL DESCRIPTION
AMOUNT IN AND COUPON
THOUSANDS MATURITY DATE RATE VALUE
----------- ------------------------------------------------ ---------- ---------------
<S> <C> <C> <C>
U.S. GOVERNMENT OBLIGATIONS (98.6%)
U.S. Treasury Notes (80.2%)
$ 4,000 08/15/03 ....................................... 5.25 % $ 3,839,280
21,600 01/31/03 ....................................... 5.50 20,952,216
20,500 11/15/04 ....................................... 5.875 19,931,945
16,000 08/15/04 ....................................... 6.00 15,649,600
12,000 12/31/01 ....................................... 6.125 11,878,440
6,000 08/31/00 ....................................... 6.25 6,002,700
38,000 10/31/01 ....................................... 6.25 37,717,280
24,000 02/15/03 ....................................... 6.25 23,704,560
22,000 08/31/01 ....................................... 6.50 21,919,700
7,000 11/15/01 ....................................... 7.50 7,064,820
15,000 02/15/01 ....................................... 7.750 15,100,950
31,000 08/15/00 ....................................... 8.75 31,172,670
------------
214,934,161
------------
U.S. Treasury Strips (18.4%)
19,000 08/15/00 ....................................... 0.00 18,776,180
8,000 08/15/01 ....................................... 0.00 7,375,360
15,900 05/15/02 ....................................... 0.00 13,962,108
11,000 05/15/03 ....................................... 0.00 9,070,930
------------
49,184,578
------------
TOTAL U.S. GOVERNMENT OBLIGATIONS
(Identified Cost $268,121,941) (a).............. 98.6 % 264,118,739
OTHER ASSETS IN EXCESS OF LIABILITIES .......... 1.4 3,814,268
----- ------------
NET ASSETS ..................................... 100.0 % $267,933,007
===== ============
</TABLE>

---------------------

(a) The aggregate cost for federal income tax purposes approximates identified
cost. The aggregate gross unrealized appreciation is $7,320 and the
aggregate gross unrealized depreciation is $4,010,522, resulting in net
unrealized depreciation of $4,003,202.

SEE NOTES TO FINANCIAL STATEMENTS

<PAGE>

MORGAN STANLEY DEAN WITTER SHORT-TERM U.S. TREASURY TRUST
FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES
May 31, 2000

<TABLE>
<S> <C>
ASSETS:
Investments in securities, at value
(identified cost $268,121,941).......................... $264,118,739
Cash ..................................................... 203,878
Receivable for:
Interest .............................................. 3,373,627
Shares of beneficial interest sold .................... 1,903,132
Prepaid expenses and other assets ........................ 17,578
-------------
TOTAL ASSETS .......................................... 269,616,954
-------------
LIABILITIES:
Payable for:
Shares of beneficial interest repurchased ............. 1,212,191
Dividends to shareholders ............................. 205,905
Plan of distribution fee .............................. 84,161
Investment management fee ............................. 84,161
Accrued expenses and other payables ...................... 97,529
-------------
TOTAL LIABILITIES ..................................... 1,683,947
-------------
NET ASSETS ............................................ $267,933,007
============
COMPOSITION OF NET ASSETS:
Paid-in-capital .......................................... $294,643,266
Net unrealized depreciation .............................. (4,003,202)
Accumulated undistributed net investment income .......... 3,399
Accumulated net realized loss ............................ (22,710,456)
-------------
NET ASSETS ............................................ $267,933,007
============
NET ASSET VALUE PER SHARE,
27,728,120 shares outstanding
(unlimited shares authorized of $.01 par value)......... $9.66
=====
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS

<PAGE>

MORGAN STANLEY DEAN WITTER SHORT-TERM U.S. TREASURY TRUST
FINANCIAL STATEMENTS, continued

STATEMENT OF OPERATIONS
For the year ended May 31, 2000

<TABLE>
<S> <C>
NET INVESTMENT INCOME:
INTEREST INCOME ............................... $17,379,570
-----------
EXPENSES
Investment management fee ..................... 1,006,144
Plan of distribution fee ...................... 965,358
Transfer agent fees and expenses .............. 110,283
Professional fees ............................. 84,628
Registration fees ............................. 35,745
Shareholder reports and notices ............... 33,489
Custodian fees ................................ 20,877
Trustees' fees and expenses ................... 16,421
Other ......................................... 22,544
-----------
TOTAL EXPENSES ............................. 2,295,489
Less: expense offset .......................... (17,901)
-----------
NET EXPENSES ............................... 2,277,588
-----------
NET INVESTMENT INCOME ...................... 15,101,982
-----------
NET REALIZED AND UNREALIZED LOSS:
Net realized loss ............................. (4,097,739)
Net change in unrealized depreciation ......... (2,823,564)
-----------
NET LOSS ................................... (6,921,303)
-----------
NET INCREASE .................................. $8,180,679
==========
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS

<PAGE>

MORGAN STANLEY DEAN WITTER SHORT-TERM U.S. TREASURY TRUST
FINANCIAL STATEMENTS, continued

STATEMENT OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
FOR THE YEAR FOR THE YEAR
ENDED ENDED
MAY 31, 2000 MAY 31, 1999
---------------- ---------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income ................................ $ 15,101,982 $ 15,299,041
Net realized loss .................................... (4,097,739) (147,939)
Net change in unrealized depreciation ................ (2,823,564) (3,693,983)
------------ ------------
NET INCREASE ...................................... 8,180,679 11,457,119
Dividends from net investment income ................. (15,237,525) (15,365,360)
Net increase (decrease) from transactions in shares of
beneficial interest ................................ (38,068,974) 75,942,528
------------ ------------
NET INCREASE (DECREASE) ........................... (45,125,820) 72,034,287
NET ASSETS:
Beginning of period .................................. 313,058,827 241,024,540
------------ ------------
END OF PERIOD
(Including undistributed net investment income of
$3,399 and $138,942, respectively) ................ $267,933,007 $313,058,827
============ ============
</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS

<PAGE>

MORGAN STANLEY DEAN WITTER SHORT-TERM U.S. TREASURY TRUST
NOTES TO FINANCIAL STATEMENTS, May 31, 2000

1. ORGANIZATION AND ACCOUNTING POLICIES

Morgan Stanley Dean Witter Short-Term U.S. Treasury Trust (the "Fund") is
registered under the Investment Company Act of 1940, as amended (the "Act"), as
a diversified, open-end management investment company. The Fund's investment
objective is current income, preservation of principal and liquidity. The Fund
seeks to achieve its objective by investing its assets in U.S. Treasury
securities backed by the full faith and credit of the U.S. Government. The Fund
was organized as a Massachusetts business trust on June 4, 1991 and commenced
operations on August 13, 1991.

The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts and disclosures. Actual results could differ
from those estimates.

The following is a summary of significant accounting policies:

A. VALUATION OF INVESTMENTS - (1) portfolio securities for which
over-the-counter market quotations are readily available are valued at the
latest available bid price prior to the time of valuation; (2) when
market quotations are not readily available, including circumstances under
which it is determined by Morgan Stanley Dean Witter Advisors Inc. (the
"Investment Manager"), that sale or bid prices are not reflective of a
security's market value, portfolio securities are valued at their fair value as
determined in good faith under procedures established by and under the general
supervision of the Trustees (valuation of debt securities for which market
quotations are not readily available may be based upon current market prices of
securities which are comparable in coupon, rating and maturity or an
appropriate matrix utilizing similar factors); and (3) short-term debt
securities having a maturity date of more than sixty days at time of purchase
are valued on a mark-to-market basis until sixty days prior to maturity and
thereafter at amortized cost based on their value on the 61st day. Short-term
debt securities having a maturity date of sixty days or less at the time of
purchase are valued at amortized cost.

B. ACCOUNTING FOR INVESTMENTS - Security transactions are accounted for on the
trade date (date the order to buy or sell is executed). Realized gains and
losses on security transactions are determined by the identified cost method.
Discounts are accreted over the life of the respective securities. Interest
income is accrued daily.

C. FEDERAL INCOME TAX STATUS - It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its shareholders.
Accordingly, no federal income tax provision is required.

D. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS - The Fund records dividends and
distributions to its shareholders on the ex-dividend date. The amount of
dividends and distributions from net investment

<PAGE>

MORGAN STANLEY DEAN WITTER SHORT-TERM U.S. TREASURY TRUST
NOTES TO FINANCIAL STATEMENTS, May 31, 2000, continued

income and net realized capital gains are determined in accordance with federal
income tax regulations which may differ from generally accepted accounting
principles. These "book/tax" differences are either considered temporary or
permanent in nature. To the extent these differences are permanent in nature,
such amounts are reclassified within the capital accounts based on their
federal tax-basis treatment; temporary differences do not require
reclassification. Dividends and distributions which exceed net investment
income and net realized capital gains for financial reporting purposes but not
for tax purposes are reported as dividends in excess of net investment income
or distributions in excess of net realized capital gains. To the extent they
exceed net investment income and net realized capital gains for tax purposes,
they are reported as distributions of paid-in-capital.

2. INVESTMENT MANAGEMENT AGREEMENT

Pursuant to an Investment Management Agreement with the Investment Manager, the
Fund pays the Investment Manager a management fee, accrued daily and payable
monthly, by applying the annual rate of 0.35% to the net assets of the Fund
determined as of the close of each business day.

3. PLAN OF DISTRIBUTION

Morgan Stanley Dean Witter Distributors Inc. (the "Distributor"), an affiliate
of the Investment Manager, is the distributor of the Fund's shares and, in
accordance with a Plan of Distribution (the "Plan") pursuant to Rule 12b-1
under the Act, finances certain expenses in connection with the distribution of
shares of the Fund.

The Fund is authorized to reimburse the Distributor for specific expenses the
Distributor incurs or plans to incur in promoting the distribution of the
Fund's shares. The amount of each monthly reimbursement payment may in no event
exceed an amount equal to a payment at the annual rate of 0.35% of the Fund's
average daily net assets during the month. For the year ended May 31, 2000, the
distribution fee was accrued at the annual rate of 0.34%.

4. SECURITY TRANSACTIONS AND TRANSACTIONS WITH AFFILIATES

The cost of purchases and proceeds from sales/maturities of portfolio
securities for the year ended May 31, 2000 aggregated $789,299,623 and
$742,325,778, respectively.

Morgan Stanley Dean Witter Trust FSB, an affiliate of the Investment Manager
and Distributor, is the Fund's transfer agent.

The Fund has an unfunded noncontributory defined benefit pension plan covering
all independent Trustees of the Fund who will have served as independent
Trustees for at least five years at the time of

<PAGE>

MORGAN STANLEY DEAN WITTER SHORT-TERM U.S. TREASURY TRUST
NOTES TO FINANCIAL STATEMENTS, May 31, 2000, continued

retirement. Benefits under this plan are based on years of service and
compensation during the last five years of service. Aggregate pension costs for
the year ended May 31, 2000 included in Trustees' fees and expenses in the
Statement of Operations amounted to $5,106. At May 31, 2000, the Fund had an
accrued pension liability of $43,934 which is included in accrued expenses in
the Statement of Assets and Liabilities.

5. SHARES OF BENEFICIAL INTEREST

Transactions in shares of beneficial interest were as follows:

<TABLE>
<CAPTION>
FOR THE YEAR FOR THE YEAR
ENDED ENDED
MAY 31, 2000 MAY 31, 1999
------------------------------------- ----------------------------------
SHARES AMOUNT SHARES AMOUNT
----------------- ------------------- ---------------- -----------------
<S> <C> <C> <C> <C>
Shares sold ........................................ 107,024,802 $ 1,047,671,631 104,838,196 $1,054,466,860
Shares issued in reinvestment of dividends ......... 1,027,913 10,046,138 1,157,486 11,633,092
------------ ---------------- ----------- --------------
108,052,715 1,057,717,769 105,995,682 1,066,099,952
Shares repurchased ................................. (111,937,772) (1,095,786,743) (98,574,910) (990,157,424)
------------ ---------------- ----------- --------------
Net increase (decrease) ............................ (3,885,057) $ (38,068,974) 7,420,772 $ 75,942,528
============ ================ =========== ==============
</TABLE>

6. FEDERAL INCOME TAX STATUS

At May 31, 2000, the Fund had a net capital loss carryover of approximately
$19,240,000, which may be used to offset future capital gains to the extent
provided by regulations, which is available through May 31 of the following
years:

<TABLE>
<CAPTION>
AMOUNTS IN THOUSANDS
-------------------------------------------------------------
2003 2004 2005 2006 2007 2008
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
$11,507 $6,271 $333 $246 $22 $861
======= ====== ==== ==== === ====
</TABLE>

Capital losses incurred after after October 31 ("post-October losses") within
the taxable year are deemed to arise on the first business day of the Fund's
next taxable year. The Fund incurred and will elect to defer net capital losses
of approximately $3,403,000 during fiscal 2000.

As of May 31, 2000, the Fund had temporary book/tax differences primarily
attributable to post-October losses.

7. RISK RELATING TO CERTAIN FINANCIAL INSTRUMENTS

The Fund may invest a portion of its assets in zero coupon U.S. Treasury
securities. Zero coupon securities are subject to substantially greater market
fluctuations during periods of changing prevailing interest rates than are
comparable debt securities.

<PAGE>

MORGAN STANLEY DEAN WITTER SHORT-TERM U.S. TREASURY TRUST
FINANCIAL HIGHLIGHTS

Selected ratios and per share data for a share of beneficial interest
outstanding throughout each period:

<TABLE>
<CAPTION>
FOR THE YEAR ENDED MAY 31
--------------------------------------------------------------------
2000 1999 1998 1997 1996
---------------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
SELECTED PER SHARE DATA:
Net asset value, beginning of period .............. $ 9.90 $ 9.96 $ 9.85 $ 9.84 $ 9.98
-------- ------- ------- ------- -------
Income (loss) from investment operations:
Net investment income ............................ 0.51 0.50 0.53 0.54 0.54
Net realized and unrealized gain (loss) .......... (0.24) (0.06) 0.11 - (0.14)
-------- -------- ------- ------- -------
Total income from investment operations ........... 0.27 0.44 0.64 0.54 0.40
-------- -------- ------- ------- -------
Less dividends from net investment income ......... (0.51) (0.50) (0.53) (0.53) (0.54)
-------- -------- -------- ------- -------
Net asset value, end of period .................... $ 9.66 $ 9.90 $ 9.96 $ 9.85 $ 9.84
======== ======= ======= ======= =======
TOTAL RETURN+ ..................................... 2.83% 4.50% 6.68% 5.63% 4.09%
RATIOS TO AVERAGE NET ASSETS:
Expenses .......................................... 0.80%(1) 0.80% 0.82% 0.83% 0.84%
Net investment income ............................. 5.25% 4.95% 5.30% 5.42% 5.33%
SUPPLEMENTAL DATA:
Net assets, end of period, in thousands ........... $267,933 $313,059 $241,025 $230,267 $258,637
Portfolio turnover rate ........................... 255% 164% 95% 149% 63%
</TABLE>

-------------
+ Calculated based on the net asset value as of the last business day of the
period.
(1) Does not reflect the effect of expense offset of 0.01%.

SEE NOTES TO FINANCIAL STATEMENTS

<PAGE>

MORGAN STANLEY DEAN WITTER SHORT-TERM U.S. TREASURY TRUST
REPORT OF INDEPENDENT ACCOUNTANTS

TO THE SHAREHOLDERS AND TRUSTEES
OF MORGAN STANLEY DEAN WITTER SHORT-TERM U.S. TREASURY TRUST

In our opinion, the accompanying statement of assets and liabilities, including
the portfolio of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of Morgan Stanley Dean Witter
Short-Term U.S. Treasury Trust (the "Fund") at May 31, 2000, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended and the financial highlights for each of
the five years in the period then ended, in conformity with accounting
principles generally accepted in the United States. These financial statements
and financial highlights (hereafter referred to as "financial statements") are
the responsibility of the Fund's management; our responsibility is to express
an opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with auditing standards
generally accepted in the United States, which require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement
presentation. We believe that our audits, which included confirmation of
securities at May 31, 2000 by correspondence with the custodian, provide a
reasonable basis for the opinion expressed above.

PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York, New York 10036
June 30, 2000

<PAGE>

MORGAN STANLEY DEAN WITTER SHORT-TERM U.S. TREASURY TRUST
CHANGE IN INDEPENDENT ACCOUNTANTS

On July 1, 2000 PricewaterhouseCoopers LLP resigned as independent accountants
of the Fund.

The reports of PricewaterhouseCoopers LLP on the financial statements of the
Fund for the past two fiscal years contained no adverse opinion or disclaimer
of opinion and were not qualified or modified as to uncertainty, audit scope or
accounting principle.

In connection with its audits for the two most recent fiscal years and through
July 1, 2000, there have been no disagreements with PricewaterhouseCoopers LLP
on any matter of accounting principles or practices, financial statement
disclosure, or auditing scope or procedure, which disagreements if not resolved
to the satisfaction of PricewaterhouseCoopers LLP would have caused them to
make reference thereto in their report on the financial statements for such
years.

The Fund, with the approval of its Board of Trustees and its Audit Committee,
engaged Deloitte & Touche LLP as its new independent accountants as of July 1,
2000.

<PAGE>

MORGAN STANLEY DEAN WITTER SHORT-TERM U.S. TREASURY TRUST

PART C OTHER INFORMATION

Item 23. Exhibits
-------- --------------------------------------------------------------------

1 (a). Declaration of Trust of the Registrant, dated June 3, 1991, is
incorporated by reference to Exhibit 1 of Post-Effective Amendment
No. 8 to the Registration Statement on Form N-1A, filed on July 29,
1998.

1 (b). Amendment dated June 22, 1998 to the Declaration of Trust of the
Registrant is incorporated by reference to Exhibit 1 of
Post-Effective Amendment No. 8 to the Registration Statement on Form
N-1A, filed on July 29, 1998.

2. Amended and Restated By-Laws of the Registrant, dated May 1, 1999,
is incorporated by reference to Exhibit 2 of Post-Effective
Amendment No. 9 to the Registration Statement on Form N-1A, filed on
June 30, 1999.

3. Not Applicable.

4. Amended Investment Management Agreement is incorporated by reference
to Exhibit 5 of Post-Effective Amendment No. 8 to the Registration
Statement on Form N-1A, filed on July 29, 1998.

5 (a). Amended Distribution Agreement is incorporated by reference to
Exhibit 6 of Post-Effective Amendment No. 7 to the Registration
Statement on Form N-1A, filed on July 31, 1997.

5 (b). Amended Selected Dealer Agreement between the Registrant and Dean
Witter Distributors Inc. is incorporated by reference to Exhibit 6
of Post-Effective No. 4 to the Registration Statement on Form N-1A,
filed on July 28, 1994.

5 (c). Omnibus Selected Dealer Agreement between Morgan Stanley Dean Witter
Distributors Inc. and National Financial Services Corporation, dated
October 17, 1998, is incorporated by reference to Exhibit 5 (c) to
Post-Effective Amendment No. 9 to the Registration Statement on Form
N-1A.

6. Amended and Restated Retirement Plan, dated May 8, 1997,is
incorporated by reference to Exhibit 6 of Post-Effective Amendment
No. 9 to the Registration Statement on Form N-1A, filed on June 30,
1999.

7 (a). Custody Agreement between The Bank of New York and the Registrant is
incorporated by reference to Exhibit 8(a) of Post-Effective
Amendment No. 6 to the Registration Statement on Form N-1A, filed on
July 23, 1996.

7 (b). Amendment dated April 17, 1996 to the Custody Agreement is
incorporated by reference to Exhibit 8(b) of Post-Effective
Amendment No. 6 to the Registration Statement on Form N-1A, filed on
July 23, 1996.

1
<PAGE>

8 (a). Amended and Restated Transfer Agency and Service Agreement is
incorporated by reference to Exhibit 8 of Post-Effective Amendment
No. 8 to the Registration Statement on Form N-1A, filed on July 29,
1998.

8 (b). Amended Services Agreement is incorporated by reference to Exhibit 9
of Post-Effective Amendment No. 8 to the Registration Statement on
Form N-1A, filed on July 29, 1998.

9 (a). Opinion of Sheldon Curtis, Esq., dated July 25, 1991 is incorporated
by reference to Exhibit 9(a) of Post-Effective Amendment No. 9 to
the Registration Statement on Form N-1A, filed on June 30, 1999.

9 (b). Opinion of Gaston & Snow, Massachusetts Counsel, dated July 25,
1991, is incorporated by reference to Exhibit 9(a) of Post-Effective
Amendment No. 9 to the Registration Statement on Form N-1A, filed on
June 30, 1999.

10. Consent of Independent Accountants, filed herein.

11. Not Applicable.

12. Not Applicable.

13. Amended and Restated Plan of Distribution pursuant to Rule 12b-1 is
incorporated by reference to Exhibit 15 of Post-Effective Amendment
No. 7 to the Registration Statement on Form N-1A, filed on July 31,
1997.

14. Not Applicable.

16(a). Codes of Ethics of Morgan Stanley Dean Witter Advisors Inc., Morgan
Stanley Dean Witter Services Company Inc. and Morgan Stanley Dean
Witter Distributors Inc., filed herein.

16(b). Code of Ethics of Morgan Stanley Dean Witter Funds, filed herein

Other Powers of Attorney of Trustees are incorporated by reference to
Exhibit (Other) of Post-Effective Amendment No. 8 to the
Registration Statement on Form N-1A, filed on July 29, 1998 and of
Post-Effective Amendment No. 4 to the Registration Statement on Form
N-1A, filed on July 28, 1994. The Power of Attorney of James F.
Higgins is filed herein.

Item 24. Persons Controlled by or Under Common Control with the Fund.

None

Item 25. Indemnification.

Pursuant to Section 5.3 of the Registrant's Declaration of Trust and under
Section 4.8 of the Registrant's By-Laws, the indemnification of the Registrant's
trustees, officers, employees and agents is permitted if it is determined that
they acted under the belief that their actions were in or not opposed to the
best interest of the Registrant, and, with respect to any criminal proceeding,
they had reasonable cause to believe their conduct was not unlawful. In
addition,

2
<PAGE>

indemnification is permitted only if it is determined that the actions in
question did not render them liable by reason of willful misfeasance, bad faith
or gross negligence in the performance of their duties or by reason of reckless
disregard of their obligations and duties to the Registrant. Trustees, officers,
employees and agents will be indemnified for the expense of litigation if it is
determined that they are entitled to indemnification against any liability
established in such litigation. The Registrant may also advance money for these
expenses provided that they give their undertakings to repay the Registrant
unless their conduct is later determined to permit indemnification.

Pursuant to Section 5.2 of the Registrant's Declaration of Trust and
paragraph 8 of the Registrant's Investment Management Agreement, neither the
Investment Manager nor any trustee, officer, employee or agent of the Registrant
shall be liable for any action or failure to act, except in the case of bad
faith, willful misfeasance, gross negligence or reckless disregard of duties to
the Registrant.

Insofar as indemnification for liabilities arising under the Securities Act
of 1933 (the "Act") may be permitted to trustees, officers and controlling
persons of the Registrant pursuant to the foregoing provisions or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a trustee, officer, or controlling person of the Registrant
in connection with the successful defense of any action, suit or proceeding) is
asserted against the Registrant by such trustee, officer or controlling person
in connection with the shares being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act, and will
be governed by the final adjudication of such issue.

The Registrant hereby undertakes that it will apply the indemnification
provision of its by-laws in a manner consistent with Release 11330 of the
Securities and Exchange Commission under the Investment Company Act of 1940, so
long as the interpretation of Sections 17(h) and 17(i) of such Act remains in
effect.

Registrant, in conjunction with the Investment Manager, Registrant's
Trustees, and other registered investment management companies managed by the
Investment Manager, maintains insurance on behalf of any person who is or was a
Trustee, officer, employee, or agent of Registrant, or who is or was serving at
the request of Registrant as a trustee, director, officer, employee or agent of
another trust or corporation, against any liability asserted against him and
incurred by him or arising out of his position. However, in no event will
Registrant maintain insurance to indemnify any such person for any act for which
Registrant itself is not permitted to indemnify him.

Item 26. Business and Other Connections of Investment Advisor

See "The Fund and Its Management" in the Prospectus regarding the business
of the investment advisor. The following information is given regarding officers
of Morgan Stanley Dean Witter Advisors Inc. ("MSDW Advisors"). MSDW Advisors is
a wholly-owned subsidiary of Morgan Stanley Dean Witter & Co.

3
<PAGE>

The term "Morgan Stanley Dean Witter Funds" refers to the following
registered investment companies:

Closed-End Investment Companies
-------------------------------
(1) Morgan Stanley Dean Witter California Insured Municipal Income Trust
(2) Morgan Stanley Dean Witter California Quality Municipal Securities
(3) Morgan Stanley Dean Witter Government Income Trust
(4) Morgan Stanley Dean Witter High Income Advantage Trust
(5) Morgan Stanley Dean Witter High Income Advantage Trust II
(6) Morgan Stanley Dean Witter High Income Advantage Trust III
(7) Morgan Stanley Dean Witter Income Securities Inc.
(8) Morgan Stanley Dean Witter Insured California Municipal Securities
(9) Morgan Stanley Dean Witter Insured Municipal Bond Trust
(10) Morgan Stanley Dean Witter Insured Municipal Income Trust
(11) Morgan Stanley Dean Witter Insured Municipal Securities
(12) Morgan Stanley Dean Witter Insured Municipal Trust
(13) Morgan Stanley Dean Witter Municipal Income Opportunities Trust
(14) Morgan Stanley Dean Witter Municipal Income Opportunities Trust II
(15) Morgan Stanley Dean Witter Municipal Income Opportunities Trust III
(16) Morgan Stanley Dean Witter Municipal Income Trust
(17) Morgan Stanley Dean Witter Municipal Income Trust II
(18) Morgan Stanley Dean Witter Municipal Income Trust III
(19) Morgan Stanley Dean Witter Municipal Premium Income Trust
(20) Morgan Stanley Dean Witter New York Quality Municipal Securities
(21) Morgan Stanley Dean Witter Prime Income Trust
(22) Morgan Stanley Dean Witter Quality Municipal Income Trust
(23) Morgan Stanley Dean Witter Quality Municipal Investment Trust
(24) Morgan Stanley Dean Witter Quality Municipal Securities

Open-end Investment Companies
-----------------------------
(1) Active Assets California Tax-Free Trust
(2) Active Assets Government Securities Trust
(3) Active Assets Institutional Money Trust
(4) Active Assets Money Trust
(5) Active Assets Premier Money Trust
(6) Active Assets Tax-Free Trust
(7) Morgan Stanley Dean Witter 21st Century Trend Fund
(8) Morgan Stanley Dean Witter Aggressive Equity Fund
(9) Morgan Stanley Dean Witter American Opportunities Fund
(10) Morgan Stanley Dean Witter Balanced Growth Fund
(11) Morgan Stanley Dean Witter Balanced Income Fund
(12) Morgan Stanley Dean Witter California Tax-Free Daily Income Trust
(13) Morgan Stanley Dean Witter California Tax-Free Income Fund
(14) Morgan Stanley Dean Witter Capital Growth Securities
(15) Morgan Stanley Dean Witter Competitive Edge Fund, "Best Ideas Portfolio"
(16) Morgan Stanley Dean Witter Convertible Securities Trust
(17) Morgan Stanley Dean Witter Developing Growth Securities Trust
(18) Morgan Stanley Dean Witter Diversified Income Trust
(19) Morgan Stanley Dean Witter Dividend Growth Securities Inc.
(20) Morgan Stanley Dean Witter Equity Fund
(21) Morgan Stanley Dean Witter European Growth Fund Inc.

4
<PAGE>

(22) Morgan Stanley Dean Witter Federal Securities Trust
(23) Morgan Stanley Dean Witter Financial Services Trust
(24) Morgan Stanley Dean Witter Fund of Funds
(25) Morgan Stanley Dean Witter Global Dividend Growth Securities
(26) Morgan Stanley Dean Witter Global Utilities Fund
(27) Morgan Stanley Dean Witter Growth Fund
(28) Morgan Stanley Dean Witter Hawaii Municipal Trust
(29) Morgan Stanley Dean Witter Health Sciences Trust
(30) Morgan Stanley Dean Witter High Yield Securities Inc.
(31) Morgan Stanley Dean Witter Income Builder Fund
(32) Morgan Stanley Dean Witter Information Fund
(33) Morgan Stanley Dean Witter Intermediate Income Securities
(34) Morgan Stanley Dean Witter International Fund
(35) Morgan Stanley Dean Witter International SmallCap Fund
(36) Morgan Stanley Dean Witter Japan Fund
(37) Morgan Stanley Dean Witter Latin American Growth Fund
(38) Morgan Stanley Dean Witter Limited Term Municipal Trust
(39) Morgan Stanley Dean Witter Liquid Asset Fund Inc.
(40) Morgan Stanley Dean Witter Market Leader Trust
(41) Morgan Stanley Dean Witter Mid-Cap Equity Trust
(42) Morgan Stanley Dean Witter Multi-State Municipal Series Trust
(43) Morgan Stanley Dean Witter Natural Resource Development Securities Inc.
(44) Morgan Stanley Dean Witter New York Municipal Money Market Trust
(45) Morgan Stanley Dean Witter New York Tax-Free Income Fund
(46) Morgan Stanley Dean Witter Next Generation Trust
(47) Morgan Stanley Dean Witter North American Government Income Trust
(48) Morgan Stanley Dean Witter Pacific Growth Fund Inc.
(49) Morgan Stanley Dean Witter Real Estate Fund
(50) Morgan Stanley Dean Witter S&P 500 Index Fund
(51) Morgan Stanley Dean Witter S&P 500 Select Fund
(52) Morgan Stanley Dean Witter Select Dimensions Investment Series
(53) Morgan Stanley Dean Witter Select Municipal Reinvestment Fund
(54) Morgan Stanley Dean Witter Short-Term Bond Fund
(55) Morgan Stanley Dean Witter Short-Term U.S. Treasury Trust
(56) Morgan Stanley Dean Witter Small Cap Growth Fund
(57) Morgan Stanley Dean Witter Special Value Fund
(58) Morgan Stanley Dean Witter Strategist Fund
(59) Morgan Stanley Dean Witter Tax-Exempt Securities Trust
(60) Morgan Stanley Dean Witter Tax-Free Daily Income Trust
(61) Morgan Stanley Dean Witter Tax-Managed Growth Fund
(62) Morgan Stanley Dean Witter Total Market Index Fund
(63) Morgan Stanley Dean Witter Total Return Trust
(64) Morgan Stanley Dean Witter U.S. Government Money Market Trust
(65) Morgan Stanley Dean Witter U.S. Government Securities Trust
(66) Morgan Stanley Dean Witter Utilities Fund
(67) Morgan Stanley Dean Witter Value-Added Market Series
(68) Morgan Stanley Dean Witter Value Fund
(69) Morgan Stanley Dean Witter Variable Investment Series
(70) Morgan Stanley Dean Witter World Wide Income Trust

5
<PAGE>

NAME AND POSITION WITH OTHER SUBSTANTIAL BUSINESS, PROFESSION, VOCATION
MORGAN STANLEY DEAN OR EMPLOYMENT, INCLUDING NAME, PRINCIPAL ADDRESS
WITTER ADVISORS INC. AND NATURE OF CONNECTION
---------------------- ----------------------------------------------------

Mitchell M. Merin President and Chief Operating Officer of Asset
President, Chief Management of Morgan Stanley Dean Witter & Co.
Executive Officer and ("MSDW); Chairman, Chief Executive Officer and
Director Director of Morgan Stanley Dean Witter Distributors
Inc. ("MSDW Distributors") and Morgan Stanley Dean
Witter Trust FSB ("MSDW Trust"); President, Chief
Executive Officer and Director of Morgan Stanley
Dean Witter Services Company Inc. ("MSDW Services");
President of the Morgan Stanley Dean Witter Funds;
Executive Vice President and Director of Dean Witter
Reynolds Inc. ("DWR"); Director of various MSDW
subsidiaries; Trustee of various Van Kampen
investment companies.

Barry Fink General Counsel of Asset Management of MSDW;
Executive Vice President, Executive Vice President, Secretary, General Counsel
Secretary, General and Director of MSDW Services; Vice President and
Counsel and Director Secretary of MSDW Distributors; Vice President,
Secretary and General Counsel of the Morgan Stanley
Dean Witter Funds.

Joseph J. McAlinden Vice President of the Morgan Stanley Dean Witter
Executive Vice President Funds; Director of MSDW Trust.
and Chief Investment
Officer

Ronald E. Robison Executive Vice President, Chief Administrative
Executive Vice President, Officer and Director of MSDW Services; Vice
Chief Administrative President of the Morgan Stanley Dean Witter Funds.
Officer and Director

Edward C. Oelsner, III
Executive Vice President

Joseph R. Arcieri Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.

Peter M. Avelar Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
and Director of the High
Yield Group

Mark Bavoso Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.

Douglas Brown
Senior Vice President

6
<PAGE>

Rosalie Clough
Senior Vice President
and Director of Marketing

Richard G. DeSalvo
Senior Vice President
and Director of Investment
Management Services

Richard Felegy
Senior Vice President

Sheila A. Finnerty Vice President of Morgan Stanley Dean Witter Prime
Senior Vice President Income Trust.

Edward F. Gaylor Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
And Director of the
Research Group

Robert S. Giambrone Senior Vice President of MSDW Services, MSDW
Senior Vice President Distributors and MSDW Trust and Director of MSDW
Trust; Vice President of the Morgan Stanley Dean
Witter Funds.

Rajesh K. Gupta Vice President of various Morgan Stanley Dean Witter
Senior Vice President, Funds.
Director of the Taxable
Fixed Income Group and
Chief Administrative
Officer - Investments

Kenton J. Hinchliffe Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.

Kevin Hurley Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.

Jenny Beth Jones Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.

Michelle Kaufman Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.

John B. Kemp, III President of MSDW Distributors.
Senior Vice President

7
<PAGE>

Anita H. Kolleeny Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
and Director of Sector
Rotation

Jonathan R. Page Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
and Director of the
Money Market Group

Ira N. Ross Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.

Guy G. Rutherfurd, Jr. Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
and Director of the
Growth Group

Rochelle G. Siegel Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.

James Solloway Jr.
Senior Vice President

Katherine H. Stromberg Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.

Paul D. Vance Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
and Director of the
Growth and Income Group

Elizabeth A. Vetell
Senior Vice President
and Director of
Shareholder Communication

James F. Willison Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
and Director of the
Tax-Exempt Fixed
Income Group

Raymond A. Basile
First Vice President

8
<PAGE>

Thomas F. Caloia First Vice President and Assistant Treasurer of
First Vice President MSDW Services; Assistant Treasurer of MSDW
and Assistant Distributors; Treasurer and Chief Financial and
Treasurer Accounting Officer of the Morgan Stanley Dean Witter
Funds.

Thomas Chronert
First Vice President

Marilyn K. Cranney Assistant Secretary of DWR; First Vice President and
First Vice President Assistant Secretary of MSDW Services; Assistant
and Assistant Secretary Secretary of MSDW Distributors and the Morgan
Stanley Dean Witter Funds.

Salvatore DeSteno First Vice President of MSDW Services.
First Vice President

Peter W. Gurman
First Vice President

Michael Interrante First Vice President and Controller of MSDW
First Vice President Services; Assistant Treasurer of MSDW Distributors;
and Controller First Vice President and Treasurer of MSDW Trust.

David Johnson
First Vice President

Stanley Kapica
First Vice President

Douglas J. Ketterer
First Vice President

Todd Lebo First Vice President and Assistant Secretary of MSDW
First Vice President and Services; Assistant Secretary of MSDW Distributors
Assistant Secretary and the Morgan Stanley Dean Witter Funds.

Lou Anne D. McInnis First Vice President and Assistant Secretary of MSDW
First Vice President and Services; Assistant Secretary of MSDW Distributors
Assistant Secretary and the Morgan Stanley Dean Witter Funds.

Carsten Otto First Vice President and Assistant Secretary of MSDW
First Vice President Services; Assistant Secretary of MSDW Distributors
and Assistant Secretary and the Morgan Stanley Dean Witter Funds.

Carl F. Sadler
First Vice President

9
<PAGE>

Ruth Rossi First Vice President and Assistant Secretary of MSDW
First Vice President and Services; Assistant Secretary of MSDW Distributors
Assistant Secretary and the Morgan Stanley Dean Witter Funds.

James P. Wallin
First Vice President

Robert Abreu
Vice President

Dale Albright
Vice President

Joan G. Allman
Vice President

Andrew Arbenz Vice President of Morgan Stanley Dean Witter Global
Vice President Utilities Fund.

Sean Aurigemma
Vice President

Armon Bar-Tur Vice President of various Morgan Stanley Dean Witter
Vice President Funds.

Maurice Bendrihem
Vice President and
Assistant Controller

Thomas A. Bergeron
Vice President

Philip Bernstein
Vice President

Dale Boettcher
Vice President

Michelina Calandrella
Vice President

Ronald Caldwell
Vice President

Joseph Cardwell
Vice President

10
<PAGE>

Liam Carroll
Vice President

Philip Casparius
Vice President

Annette Celenza
Vice President

Aaron Clark Vice President of Morgan Stanley Dean Witter Market
Vice President Leader Trust

William Connerly
Vice President

Virginia Connors
Vice President

Michael J. Davey
Vice President

David Dineen Vice President of various Morgan Stanley Dean Witter
Vice President Funds.

June Ewers
Vice President

Jeffrey D. Geffen Vice President of Morgan Stanley Dean Witter U.S.
Vice President Government Securities Trust

Sandra Gelpieryn
Vice President

Charmaine George
Vice President

Michael Geringer
Vice President

Gail Gerrity Burke
Vice President

Peter Gewirtz
Vice President

Mina Gitsevich
Vice President

11
<PAGE>

Ellen Gold
Vice President

Amy Golub
Vice President

Stephen Greenhut
Vice President

Joan Hamilton
Vice President

Trey Hancock
Vice President

Laury A. Haskamp
Vice President

Matthew T. Haynes Vice President of various Morgan Stanley Dean Witter
Vice President Funds.

Peter Hermann Jr. Vice President of various Morgan Stanley Dean Witter
Vice President Funds.

David T. Hoffman
Vice President

Thomas G. Hudson II
Vice President

Linda Jones
Vice President

Norman Jones
Vice President

Kevin Jung Vice President of various Morgan Stanley Dean Witter
Vice President Funds.

Carol Espejo-Kane
Vice President

Nancy Karole Kennedy
Vice President

Paula LaCosta Vice President of various Morgan Stanley Dean Witter
Vice President Funds.

12
<PAGE>

Kimberly LaHart
Vice President

Thomas Lawlor
Vice President

Lester Lay
Vice President

Phuong Le
Vice President

Gerard J. Lian Vice President of various Morgan Stanley Dean Witter
Vice President Funds.

Cameron J. Livingstone
Vice President

Nancy Login Cole
Vice President

Sharon Loguercio
Vice President

Stephanie Lovinger
Vice President

Steven MacNamara
Vice President

Catherine Maniscalco Vice President of various Morgan Stanley Dean Witter
Vice President Funds.

Peter R. McDowell
Vice President

Albert McGarity
Vice President

Teresa McRoberts Vice President of various Morgan Stanley Dean Witter
Vice President Funds.

Mark Mitchell
Vice President

Thomas Moore
Vice President

13
<PAGE>

Julie Morrone Vice President of various Morgan Stanley Dean Witter
Vice President Funds.

Mary Beth Mueller
Vice President

David Myers Vice President of Morgan Stanley Dean Witter Natural
Vice President Resource Development Securities Inc.

James Nash
Vice President

Daniel Niland
Vice President

Richard Norris
Vice President

Hilary A. O'Neill
Vice President

Steven Orlov
Vice President

Mori Paulsen
Vice President

Anne Pickrell
Vice President

Reginald Rigaud
Vice President

Frances Roman
Vice President

Dawn Rorke
Vice President

John Roscoe Vice President of various Morgan Stanley Dean Witter
Vice President Funds.

Hugh Rose
Vice President

Robert Rossetti Vice President of Morgan Stanley Dean Witter
Vice President Competitive Edge Fund.

14
<PAGE>

Sally Sancimino Vice President of various Morgan Stanley Dean Witter
Vice President Funds.

Deborah Santaniello
Vice President

Patrice Saunders
Vice President

Donna Savoca
Vice President

Howard A. Schloss Vice President of Morgan Stanley Dean Witter Federal
Vice President Securities Trust.

Alison M. Sharkey
Vice President

Peter J. Seeley Vice President of various Morgan Stanley Dean Witter
Vice President Funds.

Ronald B. Silvestri Vice President of various Morgan Stanley Dean Witter
Vice President Funds.

Herbert Simon
Vice President

Martha Slezak
Vice President

Otha Smith
Vice President

Stuart Smith
Vice President

Robert Stearns
Vice President

Naomi Stein
Vice President

William Stevens
Vice President

Michael Strayhorn
Vice President

15
<PAGE>

Marybeth Swisher
Vice President

Michael Thayer
Vice President

Bradford Thomas
Vice President

Barbara Toich
Vice President

Robert Vanden Assem
Vice President

Frank Vindigni
Vice President

David Walsh
Vice President

Alice Weiss Vice President of various Morgan Stanley Dean Witter
Vice President Funds.

John Wong
Vice President

The principal address of MSDW Advisors, MSDW Services, MSDW Distributors,
DWR, and the Morgan Stanley Dean Witter Funds is Two World Trade Center, New
York, New York 10048. The principal address of MSDW is 1585 Broadway, New York,
New York 10036. The principal address of MSDW Trust is 2 Harborside Financial
Center, Jersey City, New Jersey 07311.

Item 27. Principal Underwriters

(a) Morgan Stanley Dean Witter Distributors Inc. ("MSDW Distributors"), a
Delaware corporation, is the principal underwriter of the Registrant. MSDW
Distributors is also the principal underwriter of the following investment
companies:

(1) Active Assets California Tax-Free Trust
(2) Active Assets Government Securities Trust
(3) Active Assets Institutional Money Trust
(4) Active Assets Money Trust
(5) Active Assets Premier Money Trust
(6) Active Assets Tax-Free Trust
(7) Morgan Stanley Dean Witter 21st Century Trend Fund
(8) Morgan Stanley Dean Witter Aggressive Equity Fund

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<PAGE>

(9) Morgan Stanley Dean Witter American Opportunities Fund
(10) Morgan Stanley Dean Witter Balanced Growth Fund
(11) Morgan Stanley Dean Witter Balanced Income Fund
(12) Morgan Stanley Dean Witter California Tax-Free Daily Income Trust
(13) Morgan Stanley Dean Witter California Tax-Free Income Fund
(14) Morgan Stanley Dean Witter Capital Growth Securities
(15) Morgan Stanley Dean Witter Competitive Edge Fund, "Best Ideas Portfolio"
(16) Morgan Stanley Dean Witter Convertible Securities Trust
(17) Morgan Stanley Dean Witter Developing Growth Securities Trust
(18) Morgan Stanley Dean Witter Diversified Income Trust
(19) Morgan Stanley Dean Witter Dividend Growth Securities Inc.
(20) Morgan Stanley Dean Witter Equity Fund
(21) Morgan Stanley Dean Witter European Growth Fund Inc.
(22) Morgan Stanley Dean Witter Federal Securities Trust
(23) Morgan Stanley Dean Witter Financial Services Trust
(24) Morgan Stanley Dean Witter Fund of Funds
(25) Morgan Stanley Dean Witter Global Dividend Growth Securities
(26) Morgan Stanley Dean Witter Global Utilities Fund
(27) Morgan Stanley Dean Witter Growth Fund
(28) Morgan Stanley Dean Witter Hawaii Municipal Trust
(29) Morgan Stanley Dean Witter Health Sciences Trust
(30) Morgan Stanley Dean Witter High Yield Securities Inc.
(31) Morgan Stanley Dean Witter Income Builder Fund
(32) Morgan Stanley Dean Witter Information Fund
(33) Morgan Stanley Dean Witter Intermediate Income Securities
(34) Morgan Stanley Dean Witter International Fund
(35) Morgan Stanley Dean Witter International SmallCap Fund
(36) Morgan Stanley Dean Witter Japan Fund
(37) Morgan Stanley Dean Witter Latin American Growth Fund
(38) Morgan Stanley Dean Witter Limited Term Municipal Trust
(39) Morgan Stanley Dean Witter Liquid Asset Fund Inc.
(40) Morgan Stanley Dean Witter Market Leader Trust
(41) Morgan Stanley Dean Witter Mid-Cap Equity Trust
(42) Morgan Stanley Dean Witter Multi-State Municipal Series Trust
(43) Morgan Stanley Dean Witter Natural Resource Development Securities Inc.
(44) Morgan Stanley Dean Witter New York Municipal Money Market Trust
(45) Morgan Stanley Dean Witter New York Tax-Free Income Fund
(46) Morgan Stanley Dean Witter Next Generation Trust
(47) Morgan Stanley Dean Witter North American Government Income Trust
(48) Morgan Stanley Dean Witter Pacific Growth Fund Inc.
(49) Morgan Stanley Dean Witter Prime Income Trust
(50) Morgan Stanley Dean Witter Real Estate Fund
(51) Morgan Stanley Dean Witter S&P 500 Index Fund
(52) Morgan Stanley Dean Witter S&P 500 Select Fund
(53) Morgan Stanley Dean Witter Short-Term Bond Fund
(54) Morgan Stanley Dean Witter Short-Term U.S. Treasury Trust
(55) Morgan Stanley Dean Witter Small Cap Growth Fund
(56) Morgan Stanley Dean Witter Special Value Fund
(57) Morgan Stanley Dean Witter Strategist Fund
(58) Morgan Stanley Dean Witter Tax-Exempt Securities Trust
(59) Morgan Stanley Dean Witter Tax-Free Daily Income Trust

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<PAGE>

(60) Morgan Stanley Dean Witter Tax-Managed Growth Fund
(61) Morgan Stanley Dean Witter Total Market Index Fund
(62) Morgan Stanley Dean Witter Total Return Trust
(63) Morgan Stanley Dean Witter U.S. Government Money Market Trust
(64) Morgan Stanley Dean Witter U.S. Government Securities Trust
(65) Morgan Stanley Dean Witter Utilities Fund
(66) Morgan Stanley Dean Witter Value-Added Market Series
(67) Morgan Stanley Dean Witter Value Fund
(68) Morgan Stanley Dean Witter Variable Investment Series
(69) Morgan Stanley Dean Witter World Wide Income Trust

(b) The following information is given regarding directors and officers of MSDW
Distributors not listed in Item 26 above. The principal address of MSDW
Distributors is Two World Trade Center, New York, New York 10048. Other than
Messrs. Higgins and Purcell, who are Trustees of the Registrant, none of the
following persons has any position or office with the Registrant.

Name Positions and Office with MSDW Distributors
---- -------------------------------------------

James F. Higgins Director

Philip J. Purcell Director

John Schaeffer Director

Charles Vadala Senior Vice President and Financial Principal.

Item 28. Location of Accounts and Records

All accounts, books and other documents required to be maintained by
Section 31(a) of the Investment Company Act of 1940 and the Rules thereunder are
maintained by the Investment Manager at its offices, except records relating to
holders of shares issued by the Registrant, which are maintained by the
Registrant's Transfer Agent, at its place of business as shown in the
prospectus.

Item 29. Management Services

Registrant is not a party to any such management-related service contract.

Item 30. Undertakings

Registrant hereby undertakes to furnish each person to whom a prospectus is
delivered with a copy of the Registrant's latest annual report to shareholders,
upon request and without charge.

<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it meets all of
the requirements for effectiveness of this Registration Statement pursuant to
Rule 485(b) under the Securities Act of 1933 and has duly caused this
Post-Effective Amendment to the Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of New York
and State of New York on the 27th day of July, 2000.

MORGAN STANLEY DEAN WITTER SHORT-TERM U.S TREASURY TRUST

By /s/ Barry Fink
-----------------------------------
Barry Fink
Vice President Secretary

Pursuant to the requirements of the Securities Act of 1933, this Post
-Effective Amendment No.10 has been signed below by the following persons in the
capacities and on the dates indicated.

Signatures Title Date
---------- ----- ----

(1) Principal Executive Officer Chief Executive Officer,
Trustee and Chairman
By /s/ Charles A. Fiumefreddo 07/27/00
-----------------------------------
Charles A. Fiumefreddo

(2) Principal Financial Officer Treasurer and Principal
Accounting Officer

By /s/ Thomas F. Caloia 07/27/00
-----------------------------------
Thomas F. Caloia

(3) Majority of the Trustees

Charles A. Fiumefreddo (Chairman)
Philip J. Purcell
James F. Higgins

By /s/ Barry Fink 07/27/00
-----------------------------------
Barry Fink
Attorney-in-Fact

Michael Bozic Manuel H. Johnson
Edwin J. Garn Michael E. Nugent
Wayne E. Hedien John L. Schroeder

By /s/ David M. Butowsky 07/27/00
-----------------------------------
David M. Butowsky
Attorney-in-Fact

<PAGE>

MORGAN STANLEY DEAN WITTER SHORT-TERM U.S. TREASURY TRUST

EXHIBIT INDEX

10. Consent of Independent Accountants.

16(a). Code of Ethics of Morgan Stanley Dean Witter Advisors Inc., Morgan
Stanley Dean Witter Services Company Inc. and Morgan Stanley Dean
Witter Distributors Inc.

16(b). Code of Ethics of the Morgan Stanley Dean Witter Funds.

Other. Power of Attorney of James F. Higgins.