BLACKROCK 2001 TERM TRUST INC, N-30D, 1996-02-28

BLACKROCK 2001 TERM TRUST INC
N-30D, 1996-02-28

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THE BLACKROCK 2001 TERM TRUST INC.
SEMI-ANNUAL REPORT TO SHAREHOLDERS
REPORT OF INVESTMENT ADVISER
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January 31, 1996

Dear Shareholder,

Since the inception of The BlackRock 2001 Term Trust Inc. in 1992, the
market for investments in fixed income securities has witnessed an unprecedented
amount of interest rate volatility, which has changed the landscape for fixed
income investors. 1995 was a great year for investments in the bond market
following the disappointments of 1994, as yields declined and the value of fixed
income securities increased dramatically.

Looking forward, we maintain a positive outlook for the market's performance
in 1996. The economy currently appears to be growing at a steady rate and
inflation appears to be under control. Market participants are beginning to
agree that the Federal Reserve has achieved the "soft landing" that they set out
to accomplish through a series of interest rate increases last year, and are
optimistic for a further ease in the Fed's monetary policy should a budget
accord emphasizing fiscal restraint be reached in Washington.

BlackRock Financial Management, Inc. is completing its first year as part of
PNC Bank Corporation, becoming an essential part of PNC's Asset Management Group
by taking a leadership role in their fixed income management operations. We have
witnessed consistent growth of our assets under management, which now stand at
approximately $34 billion, as both retail and institutional fixed income
investors continue to recognize the value of our risk management capabilities
and long term investment philosophy.

We look forward to maintaining your respect and confidence and to serving
your financial needs in the coming year.

Sincerely,

Laurence D. Fink Ralph L. Schlosstein
Chairman President

1
<PAGE>
January 31, 1996
Dear Shareholder:

We are pleased to present the semi-annual report for The BlackRock 2001 Term
Trust Inc. (NYSE symbol: "BLK") for the period ended December 31, 1995. The past
year has been an exciting and challenging time to be participating in the fixed
income markets, and we would like to take this opportunity to review the Trust's
strong performance from both a stock price and net asset value (NAV)
perspective, as well as to discuss the opportunities available to the Trust in
the current lower interest rate environment.

The Trust is a diversified, closed-end bond fund whose investment objective
is to manage a portfolio of investment grade fixed income securities that will
return $10 per share (an amount equal to the Trust's initial public offering
price) to investors on or about June 30, 2001, while providing high current
income. The Trust seeks to meet this objective through investments in a broad
array of fixed income products including agency mortgage-backed securities
(Fannie Mae, Freddie Mac or Ginnie Mae), U.S. Treasury and agency securities,
asset-backed securities and investment grade corporate debt securities.

The table below summarizes the performance of the Trust's stock price and
net asset value (the market value of its portfolio holdings per share) over the
six months:

------------------------------------------------------
12/31/95 6/30/95 Change High Low
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Stock Price $7.625 $7.50 1.67% $8.250 $7.125
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Net Asset Value (NAV) $9.04 $8.72 3.67% $9.04 $8.03
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Premium/(Discount) to NAV (15.65%) (13.99%) (1.66%) (16.36%) (16.67%)
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The Fixed Income Markets

The dramatic rally in the fixed income markets, which caused interest rates
to fall and prices of fixed income securities to rise since late 1994 has
changed the market landscape for fixed income investors. A deceleration in
economic growth from the torrid pace of 1994 as well as continued signs of
subdued inflation led to a substantial decrease in interest rates across the
Treasury yield curve. At the end of December, the yield of the Treasury 30-year
bond fell below 6.00% for the first time since October 1993, closing the year at
5.95%, while the yield of the 5-year Treasury fell approximately 2.50% to end
1995 at 5.37%.

The Federal Reserve reversed its policy of "tight" monetary control for the
first time in almost two years by lowering the Fed funds target rate by 25 basis
points (0.25%) on July 7, in response to economic reports expressing moderate
but sustainable economic growth in the first half of the year. During July and
early August, the bond market rally temporarily halted as stronger economic data
dampened expectations for a follow-up reduction in short-term rates. However, as
the fourth quarter began, the economy again showed signs of sluggish growth and
interest rates returned to their 1995 lows in anticipation of another

2
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Fed ease by year end. Indeed, the Fed made two quarter-point reductions in the
Fed funds rate on December 19 and January 31. These reductions could make the
Trust's use of leverage more profitable, as the Treasury yield curve is expected
to steepen, resulting in a wider differential (or "spread") between the Trust's
borrowing costs and the rates at which the Trust can invest the borrowed funds.

Market participants remain attentive to the politically-charged debate
surrounding Federal budget proposals. Congressional and White House leaders have
been unable to fashion a credible 7-year balanced budget agreement, and appear
resigned to let the debate linger as we move into the election year. As such,
fixed income investors are concerned about a potential credit downgrade or
technical default on certain U.S. Treasury issues should policy-makers be unable
to reach an agreement on extending the Federal debt-ceiling until a budget
accord is struck later in the year.

BlackRock Financial Management is attuned to these continuing political
issues, but we remain positive on the fixed income markets in early 1996 as
moderate economic and inflationary data have set the stage for continued strong
performance for fixed income securities.

The Trust's Portfolio and Investment Strategy

BlackRock has been actively managing the Trust's portfolio holdings
consistent with BlackRock's overall market outlook and the Trust's investment
objectives. The chart below illustrates the Trust's portfolio compositions as of
December 31, 1995 and June 30, 1995.

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The BlackRock 2001 Term Trust Inc.
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Composition December 31, 1995 June 30, 1995
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Mortgage Pass-Throughs 30% 33%
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Taxable Zero Coupon Bonds 22% 23%
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Agency Multiple Class Mortgage Pass-Throughs 11% 15%
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Adjustable Rate Mortgages 9% 8%
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Stripped Mortgage-Backed Securities 8% 4%
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Corporate Bonds 8% 2%
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U.S. Treasury Securities 7% 10%
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Commercial Mortgage-Backed Securities 1% 2%
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Non-Agency Multiple Class Mortgage Pass-Throughs 1% 1%
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Municipal Bonds 1% 1%
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CMO Residuals 1% 1%
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Asset-Backed Securities 1% 0%
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The most significant shift in the Trust's portfolio over the six months has
been an increased exposure to the corporate debt sector and a corresponding
decrease in allocations to mortgage pass-through securities. Since first
obtaining the broadened investment authority from shareholders in May 1995 to
purchase and hold investment grade corporate debt, the Trust has increased its
holdings of these securities to 8% as of year end. The Trust may continue to
increase its allocation to corporate debt securities upon opportunity,

3
<PAGE>

as these securities offer a higher degree of cash flow stability and call
protection than mortgage securities, and could provide the Trust with a more
stable income over time. BlackRock Financial Management remains confident in the
Trust's ability to return $10 per share to shareholders at its slated
termination date in 2001.

We look forward to managing the Trust in the coming year to benefit from the
opportunities available to investors in the fixed income markets as well as to
maintain the Trust's ability to meet its investment objectives. We thank you for
your investment in the BlackRock 2001 Term Trust Inc. and extend our continued
commitment to addressing your questions and concerns. Please feel free to
contact our marketing center at (800) 227-7BFM (7236) if you have questions
which were not addressed in this report.

Sincerely,

Robert S. Kapito Keith T. Anderson
Vice Chairman and Portfolio Manager Managing Director and Portfolio Manager
BlackRock Financial Management, Inc. BlackRock Financial Management, Inc.

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The BlackRock 2001 Term Trust Inc.
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Symbol on New York Stock Exchange: BLK
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Initial Offering Date: July 23, 1992
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Closing Stock Price as of 12/31/95: $7.625
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Net Asset Value as of 12/31/95: $9.04
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Yield on Closing Stock Price as of 12/31/95 ($7.625)1: 5.90%
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Current Monthly Distribution per Share2: $0.0375
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Current Annualized Distribution per Share2: $0.45
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1Yield on Closing Stock Price is calculated by dividing the current annualized
distribution per share by the closing stock price per share.
2Dividend not constant and is subject to change.

4
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(LEFT COLUMN)
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The BlackRock 2001 Term Trust Inc.
Portfolio of Investments
December 31, 1995
(Unaudited)
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Principal
Amount Value
Rating* (000) Description (Note 1)
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LONG-TERM INVESTMENTS-147.6%
Mortgage Pass-Throughs-56.3%
Federal Home Loan Mortgage
Corporation,
$ 1,957 6.50%, 08/01/25 - 10/01/25 ............ $ 1,935,236
4,147 7.50%, 07/01/13 - 11/01/23 ............ 4,251,881
26,851 8.00%, 10/01/07 - 03/01/23 ............ 27,819,075
29,203 8.50%, 02/01/08 - 09/01/24 ............ 30,624,536
10,538(d) 8.60%, 05/01/02,
7 Year Multifamily .................. 10,966,205
Federal National Mortgage
Association,
126,627@@ 7.00%, 01/01/99 - 09/01/02,
7 Year .............................. 128,921,419
34,152 7.00%, 01/01/99 - 01/01/22 ............ 34,429,590
11,176 7.50%, 08/01/99 - 06/01/02,
7 Year .............................. 11,438,301
9,938 7.50%, 09/01/01,
7 Year Multifamily .................. 10,170,675
26,946 7.50%, 09/01/07 - 10/01/23 ............ 27,652,768
6,621 7.66%, 01/01/01,
7 Year Multifamily .................. 6,969,181
10,785 7.695%, 05/01/01,
Multifamily ......................... 11,418,971
11,492 7.79%, 02/01/01,
7 Year Multifamily .................. 12,151,633
15,260 8.00%, 03/01/01,
7 Year Multifamily .................. 16,261,954
46,640(d) 8.00%, 03/01/02 - 12/01/23 ............ 48,021,430
3,760 8.49%, 04/01/01,
7 Year Multifamily .................. 4,062,028
12,812 8.50%, 11/01/03 - 09/01/10 ............ 13,367,975
112 8.50%, 09/01/09, 15 Year .............. 116,483
2,473 8.69%, 04/01/21,
7 Year Multifamily .................. 2,676,179
1,027 9.00%, 02/01/02, 7 Year ............... 1,046,492
2,796 9.292%, 09/01/01,
7 Year Multifamily .................. 3,073,621
Government National
Mortgage Association,
20,074 6.50%, 05/20/25 - 06/20/25,
1 Year CMT (ARM) .................... 21,037,933
111,749 (d) 7.00%, 10/20/24 - 05/20/25,
1 Year CMT (ARM) .................... 113,719,183
23,455 7.00%, 01/15/99 - 05/15/24 ............ 23,733,324
11,100 8.00%, 01/15/23 - 06/15/24 ............ 11,564,523
45,201 8.50%, 05/15/16 - 06/15/23 ............ 47,793,777
69,205 9.00%, 04/15/16 - 10/20/19 ............ 73,804,162
21,904 9.50%, 03/15/16 - 12/15/17 ............ 23,640,859
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722,669,394
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(RIGHT COLUMN)
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Principal
Amount Value
Rating* (000) Description (Note 1)
- --------------------------------------------------------------------------------
Multiple Class Mortgage
Pass-Throughs-19.5%
Aaa 1,440 Chase Mortgage Finance
Corporation, Series 1993-1,
Class 2, 07/25/23 ..................... $ 1,472,400
AAA 704 Collateralized Mortgage
Securities Corporation,
Series F, Class F-4A,
11/01/15 .............................. 710,141
AAA 2,578 Countrywide Funding
Corporation, Series 1994-I,
Class A-5, 07/25/09 ................... 2,573,785
Federal Home Loan Mortgage
Corporation, Multiclass
Mortgage Participation
Certificates,
80 Series G-002, Class G-002-N,
03/25/22 (I) ........................ 3,384,000
4,672 Series 269, Class 269-1,
08/01/22 ............................ 4,935,213
4,000 Series 1161, Class 1161-H,
11/15/20 ............................ 4,109,280
15,334 Series 1184, Class 1184-G,
04/15/20 ............................ 15,950,274
72 Series 1185, Class 1185-C,
12/15/06 ............................ 1,401,783
28,105 Series 1261, Class 1261-H,
08/15/19 ............................ 28,998,398
15,794 Series 1264, Class 1264-GA,
01/15/21 ............................ 16,640,716
12,556 Series 1376, Class 1376-I,
10/15/03 ............................ 13,367,620
12,450 Series 1382, Class 1382-G,
09/15/19 ............................ 12,668,373
2,351 Series 1544, Class 1544-TM,
07/15/08 (ARM) ...................... 2,333,064
9,596 Series 1628, Class 1628-SJ,
12/15/23 (ARM) ...................... 8,962,463
4,648 Series 1704, Class 1704-S,
03/15/09 (ARM) ...................... 4,099,150
52,664 Series 1790, Class 1790-D,
11/15/23 (ARM) ...................... 987,453
8,166 Trust 1993-M2, Class M2-H,
11/25/03 ............................ 8,177,637
92,090 Trust 1993-202, Class 202-SL,
11/25/23 (ARM) ...................... 5,554,200
11,083 Trust 1995-W3, Class W3-A,
04/25/25 ............................ 11,574,502

See Notes to Financial Statements.

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(LEFT COLUMN)
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Principal
Amount Value
Rating* (000) Description (Note 1)
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Multiple Class Mortgage
Pass-Throughs (cont'd)
Federal National Mortgage
Association, REMIC
Pass-Through Certificates,
$ 5,489 Trust 1990-144,
Class 144-W, 12/25/20 ............... $ 6,171,174
12,000 Trust 1991-9, Class 9-J,
02/25/06 ............................ 12,599,040
8,075@ Trust 1992-G41,
Class G41-H, 01/25/19 ............... 8,251,625
15,000 Trust 1992-121,
Class 121-SE, 02/25/23 .............. 15,589,350
10,000 Trust 1992-122, Class 122-PJ,
06/25/19 ............................ 10,337,300
1,735 Trust 1993-58, Class 58-C,
04/25/23 (ARM) ...................... 1,466,313
13,911 Trust 1993-68, Class 68-PJ,
12/25/06 (I) ........................ 1,486,718
1,600 Trust 1993-71, Class 71-PG,
07/25/07 ............................ 1,818,972
1,585 Trust 1993-121, Class 121-SE,
02/25/23 (ARM) ...................... 1,319,404
4,786 Trust 1993-126, Class 126-B,
07/25/23 (P) ........................ 4,222,897
15,350 Trust 1993-152, Class 152-D,
08/25/23 (P) ........................ 12,303,946
43,752 Trust 1993-240, Class 240-PS,
09/25/12 (ARM) ...................... 2,023,524
8,207 Trust 1994-23, Class 23-SC,
08/25/04 (ARM) ...................... 7,386,300
24,473 Trust 1994-61, Class 61-DB,
09/25/24 ............................ 17,812,101
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250,689,116
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Commercial Mortgage Backed
Securities-2.2%
BBB 10,000 CBA Mortgage Corporation,
Series 1993-C-1, Class D,
12/25/03 ............................ 10,065,787
A 1,250 Gentra Capital Commercial
Real Estate, Series 1994-1,
Class 1-D, 07/25/28 ................. 1,300,390
Resolution Trust Corporation,
AA- 7,498 Series 1992-C6, Class B,
07/25/24 .......................... 7,664,082
A 5,852 Series 1994-C2, Class D,
04/25/25 .......................... 6,016,102
BBB 3,000 Series 1995-C1, Class D,
02/25/27 .......................... 2,860,312
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27,906,673
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Corporate Bonds-11.8%
Banking and Finance-6.7%
BBB+ 1,300 Amsouth Bancorporation,
6.75%, 11/01/25 ..................... 1,372,540
Associates Corporation,
AA- 5,000 6.68%, 07/25/00 ..................... 5,169,400
AA- 5,000 7.46%, 03/28/00 ..................... 5,296,875

(RIGHT COLUMN)
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Principal
Amount Value
Rating* (000) Description (Note 1)
- --------------------------------------------------------------------------------
A+ $ 6,750 Goldman Sachs Group LP,
6.20%, 12/15/00 ....................... $ 6,795,997
BBB+ 5,000 Great Western Financial
Corporation,
6.375%, 07/01/00 ...................... 5,072,150
Household Finance
Corporation,
A 7,000 6.65%, 05/26/98 ....................... 7,146,160
A 4,000 7.45%, 04/01/00 ....................... 4,230,360
BBB+ 5,700 Meridian Bancorp
Incorporated,
6.625%, 06/15/00 ...................... 5,852,076
Salomon Incorporated,
BBB+ 8,000 7.59%, 01/28/00 ....................... 8,333,200
BBB 4,500 7.75%, 05/15/00 ....................... 4,683,460
Smith Barney Holdings
Incorporated,
A- 3,000 6.00%, 03/15/97 ....................... 3,012,060
A- 3,000 6.625%, 06/01/00 ...................... 3,081,690
A- 3,600 7.00%, 05/15/00 ....................... 3,738,153
A- 6,500 7.98%, 03/01/00 ....................... 6,968,585
A 15,000 Transamerica Finance
Corporation,
6.75%, 06/01/00 ....................... 15,472,570
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86,225,276
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Industrial-4.5%
A- 20,600 General Motors Acceptance
Corporation, 6.125%,
09/18/98 .............................. 20,803,940
RJR Nabisco Brands
Incorporated,
BBB 9,000 8.00%, 01/15/00 ....................... 9,566,100
BBB- 6,000 8.00%, 07/15/01 ....................... 6,110,966
BBB- 5,000 Royal Caribbean Cruises
Limited, 7.125%, 09/18/02 ............. 5,090,605
Sears Roebuck & Company,
BBB 4,250 6.50%, 06/15/00 ....................... 4,347,878
BBB 5,000 7.29%, 04/24/00 ....................... 5,248,010
BBB- 5,900 Tenneco Credit Corporation,
9.625%, 08/15/01 ...................... 6,851,842
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58,019,341
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Yankee-0.6%
AA+ 3,350 African Development,
8.825%, 05/01/01 ...................... 3,769,962
AAA 3,000 European Investment Bank,
8.875%, 03/01/01 ...................... 3,400,456
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7,170,418
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See Notes to Financial Statements.

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Asset-Backed Securities-0.8%
AAA $10,462 Nationsbank Auto Grantor Trust,
Series 1995-A, Class A, 5.85% ......... $ 10,534,312
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Stripped Mortgage-Backed
Securities-12.1%
Aaa 83 CMO Mortgage Investors Trust,
Collateralized Mortgage
Obligations, Trust 7, Series P,
09/22/21 (I/O) ........................ 2,087,394
Collateralized Mortgage Securities
Corporation,
AAA 25 Series 1990-5, Class 5-L,
09/20/20 (I/O) ...................... 430,080
AAA 61 Series 1991-9, Class M,
11/20/21 (I/O) ...................... 826,865
Federal Home Loan Mortgage
Corporation,
86 Series 113, Class 113-N,
05/15/21 (I/O) ...................... 1,902,767
135 Series 181, Class 181-F,
07/15/21 (I/O) ...................... 2,193,750
76 Series 1018, Class 1018-I,
11/15/20 (I/O) ...................... 2,237,625
21 Series 1125, Class 1125-F,
08/15/21 (I/O) ...................... 495,139
28 Series 1189, Class 1189-I,
01/15/22 (I/O) ...................... 677,797
28 Series 1190, Class 1190-V,
01/15/22 (I/O) ...................... 791,032
47 Series 1274, Class 1274-Y,
05/15/22 (I/O) ...................... 1,126,406
49 Series 1283, Class 1283-X,
06/15/22 (I/O) ...................... 1,159,112
575 Series 1382, Class 1382-LB,
10/15/22 (I/O) ...................... 4,951,647
130 Series 1404, Class 1404-E,
01/15/06 (I/O) ...................... 2,023,749
30 Series 1418, Class 1418-K,
06/15/22 (I/O) ...................... 1,830,000
9,150 Series 1498, Class 1498-L,
04/15/23 (I/O) ...................... 3,042,375
9,082 Series 1662, Class 1662-PO,
01/15/09 (P/O) ...................... 6,797,496
42,760 Series 1696, Class 1696-B,
11/15/23 (P/O) ...................... 24,533,427
3,271 Series 1721, Class 1721-OC,
05/15/24 (P/O) ...................... 2,180,345
Federal National Mortgage
Association,
2,850 Series 1989-28, Class 28-B,
09/25/17 (P/O) ...................... 2,329,474

$ 34 Series 1991-G46, Class G46-K,
12/15/09 (I/O) ...................... $ 902,352
3,283 Series 1992-G55, Class G55-D,
11/25/17 (P/O) ...................... 1,500,922
924 Series 1991-167, Class 167-B,
10/25/17 (P/O) ...................... 554,982
4,015 Trust 1, Class 2, 02/01/17 (I/O) ...... 985,176
3,712 Trust 2, Class 2, 02/01/17 (I/O) ...... 954,728
5,141 Trust 3, Class 1, 02/01/17 (P/O) ...... 4,132,295
3,776 Trust 5, Class 1, 09/01/17 (P/O) ...... 2,986,198
10,860 Trust 9, Class 2, 02/01/17 (I/O) ...... 2,606,516
10,918 Trust 14, Class 2,
02/01/17 (I/O) ...................... 2,606,645
1,026 Trust 58, Class 2,
12/01/18 (I/O) ...................... 264,444
2,182 Trust 60, Class 1,
01/01/19 (P/O) ...................... 1,787,081
18,709 Trust 225, Class 1,
02/01/23 (P/O) ...................... 14,949,800
68,758 Trust 226, Class 2,
06/01/23 (I/O) ...................... 16,502,028
28 Trust 1990-76, Class 76-N,
07/25/20 (I/O) ...................... 727,659
36 Trust 1990-106, Class 106-K,
09/25/20 (I/O) ...................... 882,790
17,225 Trust 1990-160, Class 106-PM,
06/01/22 (I/O) ...................... 4,327,902
175 Trust 1991-11, Class 11-E,
02/25/21 (I/O) ...................... 4,898,861
38 Trust 1991-17, Class 17-H,
03/25/21 (I/O) ...................... 1,004,121
16 Trust 1991-29, Class 29-J,
04/25/21 (I/O) ...................... 433,680
75 Trust 1991-40, Class 40-K,
06/25/21 (I/O) ...................... 1,225,939
49 Trust 1991-80, Class 80-Q,
07/25/21 (I/O) ...................... 1,181,718
56 Trust 1991-113, Class 113-H,
09/25/21 (I/O) ...................... 2,715,377
59 Trust 1991-160, Class 160-PM,
12/25/21 (I/O) ...................... 1,755,310
50 Trust 1991-164, Class 164-PM,
12/25/21 (I/O) ...................... 1,700,000
17,355 Trust 1992-G45, Class G45-B,
08/25/22 (I/O) ...................... 3,904,842
110 Trust 1992-131, Class 131-JC,
06/25/21 (I/O) ...................... 3,052,500
400 Trust 1992-180, Class 180-MA,
10/25/22 (I/O) ...................... 12,842,569
4,703 Trust 1994-53, Class 53-EA,
11/25/23 (P/O) ...................... 2,686,540
AAA 6,455 Residential Funding Corporation,
Trust 1992-66, Class S6-A11,
02/25/22 (I/O) ........................ 63,545
------------
155,753,000
------------

See Notes to Financial Statements.

7
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Collateralized Mortgage
Obligation Residuals**-0.3%
$ 3 Federal Home Loan Mortgage
Corporation, Multiclass
Mortgage Participation
Certificates, Series 1017,
Class 1017 (REMIC), 11/15/20 .......... $ 493,300
AAA 10 Fleet Mortgage Securities, Inc.,
Series 1989-3, Class R,
09/01/19# ............................. 779,527
AAA 10,000 Residential Resources
Incorporated, Mortgage
Collateral Bond, Series 9,
Class 1XF, 10/01/18# .................. 1,513,045
AAA 499 Shearson Lehman Brothers,
Series F, Class R, 02/20/18# .......... 818,016
AAA 10,000 Smith Barney Mortgage Capital
Trust, Series 10, Class R,
10/01/19# ............................. 297,047
------------
3,900,935
------------
U.S. Government Security-10.6%
120,750(d)(d) U.S. Treasury Bonds,
6.875%, 8/15/25 ....................... 136,183,058
------------
Taxable Zero Coupon Bonds-32.8%
Financing Corporation
(FICO Strips),
5,311 02/08/01 ............................ 3,999,289
4,472 03/26/01 ............................ 3,342,641
1,660 04/05/01 ............................ 1,241,348
7,334 05/02/01 ............................ 5,444,395
2,513 05/11/01 ............................ 1,868,843
2,000 06/03/01 ............................ 1,462,300
22,134 06/06/01 ............................ 16,397,310
26,270 06/27/01 ............................ 19,398,556
5,311 08/08/01 ............................ 3,880,110
8,980 09/07/01 ............................ 6,552,886
4,472 09/28/01 ............................ 3,242,826
5,068 10/05/01 ............................ 3,678,202
13,000 10/06/01 ............................ 9,401,600
3,667 11/02/01 ............................ 2,641,230
1,259 11/11/01 ............................ 908,671
5,600 12/27/01 ............................ 4,013,016
Government Trust Certificates,
2,500 11/15/99 ............................ 2,029,100
20,960 11/15/01 ............................ 14,712,939
6,597 05/15/02 ............................ 4,639,076
4,000 11/15/02 ............................ 2,720,600
28,900 U.S. Treasury Obligation,
11/15/01 ............................ 20,445,016
U.S. Treasury Receipt,
100,000(d)(d) 02/15/01 ............................ 76,144,000
187,000(d)(d) 05/15/01 ............................ 140,371,550
58,000(d) 05/15/01 ............................ 43,571,920
39,499 11/15/01 ............................ 28,670,013
------------
420,777,437
------------

- ------------
*Using the higher of Standard & Poor's or Moody's rating.
**Illiquid securities representing 0.21% of portfolio assets.
#Private placements restricted as to resale.
(d)Partial principal amount pledged as collateral for reverse repurchase
agreements.
(d)(d)Entire principal amount pledged as collateral for reverse repurchase
agreements.
@Entire principal amount pledged as collateral for futures transactions.
@@Includes mortgage dollar roll of $113,011,320, see Note 4.

-----------------------------------------------------------------
KEY TO ABBREVIATIONS
ARM -Adjustable Rate Mortgage.
CMO -Collateralized Mortgage Obligation.
I -Denotes CMO with Interest Only Characteristics.
I/O -Interest Only.
P -Denotes CMO with Principal Only Characteristics.
P/O -Principal Only.
REMIC -Real Estate Mortgage Investment Conduit.
-----------------------------------------------------------------

See Notes to Financial Statements.

8
<PAGE>

(LEFT COLUMN)
- --------------------------------------------------------------------------------
The BlackRock 2001 Term Trust Inc.
Statement of Assets and Liabilities
December 31, 1995
(Unaudited)
- --------------------------------------------------------------------------------
Assets
Investments, at value
(cost $1,906,517,779) (Note 1) ............................. $1,895,838,064
Cash ......................................................... 49,117
Deposits with brokers as collateral for
investments sold short (Note 1) ............................ 69,881,658
Interest receivable .......................................... 15,612,056
Receivable for investments sold .............................. 8,061,923
Due from broker-variation margin ............................. 340,591
Unrealized appreciation on interest rate floor
(Notes 1 & 3) .............................................. 126,034
Deferred organization expenses and
other assets ............................................... 17,374
--------------
1,989,926,817
--------------
Liabilities
Reverse repurchase agreements (Note 4) ....................... 458,391,213
Dollar roll payable (Note 4) ................................. 113,011,320
Investments sold short, at value
(proceeds $57,444,889) (Note 1) ............................ 67,497,640
Payable for investments purchased ............................ 62,934,169
Interest payable ............................................. 1,973,342
Dividends payable ............................................ 734,820
Advisory fee payable (Note 2) ................................ 429,913
Administration fee payable (Note 2) .......................... 107,478
Accrued excise tax ........................................... 90,000
Other accrued expenses ....................................... 556,436
--------------
705,726,331
--------------
Net Assets $1,284,200,486
==============
Net assets were comprised of:
Common stock, at par (Note 5) .............................. $ 1,420,106
Paid-in capital in excess of par ........................... 1,338,223,236
--------------
1,339,643,342
--------------
Undistributed net investment income ........................ 16,225,070
Accumulated net realized loss .............................. (52,629,975)
Net unrealized depreciation ................................ (19,037,951)
--------------
Net assets, December 31, 1995 .............................. $1,284,200,486
==============
Net asset value per share:
($1,284,200,486 / 142,010,583 shares of
common stock issued and outstanding) ....................... $9.04
=====
See Notes to Financial Statements.

RIGHT COLUMN
- -------------------------------------------------------------------------------
The BlackRock 2001 Term Trust Inc.
Statement of Operations
For the Six Months Ended December 31, 1995
(Unaudited)
- -------------------------------------------------------------------------------

Net Investment Income
Income
Interest (including net accretion of discount
of $4,870,335 and net of interest expense
of $16,375,533) .......................................... $48,144,833
-----------
Operating expenses
Investment advisory ........................................ 2,506,164
Administration ............................................. 626,541
Custodian .................................................. 299,532
Reports to shareholders .................................... 263,277
Transfer agent ............................................. 70,060
Audit ...................................................... 43,236
Directors .................................................. 38,117
Legal ...................................................... 21,520
Miscellaneous .............................................. 27,202
-----------
Total operating expenses ................................. 3,895,649
Net investment income before excise tax .................... 44,249,184
Excise tax ................................................. 90,000
-----------
Net investment income ...................................... 44,159,184
-----------

Realized and Unrealized Gain (Loss) on
Investments (Note 3)
Net realized gain (loss) on:
Investments ................................................ 10,597,589
Short sales ................................................ (8,647,120)
Futures .................................................... 2,440,659
-----------
4,391,128
-----------
Net change in unrealized appreciation
(depreciation) on:
Investments ................................................ 30,782,149
Short sales ................................................ (3,212,234)
Futures .................................................... 1,643,294
-----------
29,213,209
-----------
Net gain on investments ...................................... 33,604,337
-----------

Net Increase in Net Assets
Resulting from Operations .................................. $77,763,521
===========
See Notes to Financial Statements.

9
<PAGE>

(LEFT COLUMN)
- -------------------------------------------------------------------------------
The BlackRock 2001 Term Trust Inc.
Statement of Cash Flows
For the Six Months Ended December 31, 1995
(Unaudited)
- -------------------------------------------------------------------------------
Increase (Decrease) in Cash
Cash flows provided by operating activities:
Interest received, net of interest purchased ............... $ 60,576,342
Operating expenses and excise taxes paid ................... (3,859,982)
Interest expense paid ...................................... (16,501,394)
Purchase of long-term portfolio investments ................ (2,610,408,833)
Sale of long-term portfolio investments .................... 2,630,263,129
Other ...................................................... 111,836
--------------
Net cash flows provided by operating
activities ............................................... 60,181,098
--------------
Cash flows used for financing activities:
Decrease in reverse repurchase agreements .................. (30,943,381)
Dividends paid ............................................. (32,200,820)
--------------
Net cash flows used for financing
activities ............................................... (63,144,201)
--------------
Net decrease in cash ......................................... (2,963,103)
Cash at beginning of period .................................. 3,012,220
--------------
Cash at end of period ........................................ $ 49,117
==============
Reconciliation of Net Increase in Net
Assets Resulting from Operations to Net
Cash Flows Provided by Operating Activities
Net increase in net assets resulting from
operations ................................................. $ 77,763,521
--------------
Increase in investments ...................................... (85,866,952)
Net realized gain ............................................ (4,391,128)
Decrease in unrealized depreciation .......................... (29,213,209)
Increase in unrealized appreciation on
interest rate floor ........................................ (126,034)
Increase in interest receivable .............................. (3,944,024)
Decrease in receivable for investments sold .................. 83,323,247
Increase in broker-variation margin .......................... (327,218)
Decrease in deposits with brokers ............................ 10,364,217
Decrease in deferred and prepaid assets ...................... 111,836
Decrease in dollar roll payable .............................. (14,941,180)
Increase in payable for investments purchased ................ 39,028,213
Decrease in payable for securities
sold short ................................................. (11,599,997)
Decrease in interest payable ................................. (125,861)
Increase in accrued excise tax................................ 90,000
Increase in accrued expenses and other
liabilities ................................................ 35,667
--------------
Total adjustments .......................................... (17,582,423)
Net cash flows provided by operating
activities ................................................. $ 60,181,098
==============

(RIGHT COLUMN)
- -------------------------------------------------------------------------------
The BlackRock 2001 Term Trust Inc.
Statements of Changes
in Net Assets
(Unaudited)
- -------------------------------------------------------------------------------

Six Months Year
Ended Ended
December 31, 1995 June 30, 1995
----------------- -------------
Increase (Decrease) in
Net Assets

Operations:

Net investment income ........................ $ 44,159,184 $ 86,059,039

Net realized gain (loss)
on investments, short
sales and futures .......................... 4,391,128 (33,684,786)

Net change in unrealized
appreciation
(depreciation) on
investments, short
sales and futures .......................... 29,213,209 92,654,488
-------------- --------------

Net increase
in net assets resulting
from operations ............................ 77,763,521 145,028,741

Dividends from net
investment income .......................... (31,952,284) (88,759,294)
-------------- --------------

Net increase ................................. 45,811,237 56,269,447

Net Assets

Beginning of period .......................... 1,238,389,249 1,182,119,802
-------------- --------------

End of period ................................ $1,284,200,486 $1,238,389,249
============== ==============

See Notes to Financial Statements.

10
<PAGE>

- ------------------------------------------------------------------------------
The BlackRock 2001 Term Trust Inc.
Financial Highlights
(Unaudited)
- ------------------------------------------------------------------------------
August 28,
Six Months 1992*
Ended Year Ended June 30, to
December 31, --------------------- June 30,
1995 1995 1994 1993
---------- ---------- ---------- ----------
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning
of period ............... $ 8.72 $ 8.32 $ 9.62 $ 9.45
---------- ---------- ---------- ----------
Net investment income
(net of $0.12, $0.27,
$0.12 and $0.04,
respectively, of
interest expense) ....... 0.31 0.61 0.64 0.66

Net realized and unrealized
gain (loss) on
investments, short sales
and futures ............. 0.24 0.42 (1.23) 0.07
---------- ---------- ---------- ----------
Net increase (decrease)
from investment
operations .............. 0.55 1.03 (0.59) 0.73
---------- ---------- ---------- ----------
Dividends from net
investment income ....... (0.23) (0.63) (0.71) (0.54)
---------- ---------- ---------- ----------
Capital charge with
respect to issuance
of shares ............... - - - (0.02)
---------- ---------- ---------- ----------
Net asset value,
end of period** ......... $ 9.04 $ 8.72 $ 8.32 $ 9.62
========== ========== ========== ==========
Market value,
end of period** ......... $ 7.625 $ 7.50 $ 8.00 $ 9.375#
========== ========== ========== ==========
TOTAL INVESTMENT RETURN(d) 4.69% 1.61% (7.73)% 4.99%
RATIOS TO AVERAGE NET ASSETS:
Operating expenses(d)(d)(d) 0.62%(d)(d) 0.63% 0.67% 0.60%(d)(d)
Net investment income ..... 7.03%(d)(d) 7.28% 6.97% 8.41%(d)(d)
SUPPLEMENTAL DATA:
Average net assets
(in thousands) .......... $1,246,272 $1,181,411 $1,295,131 $1,327,571
Portfolio turnover ........ 115% 107% 91% 210%
Net assets, end of period
(in thousands) .......... $1,284,200 $1,238,389 $1,182,120 $1,366,284
Reverse repurchase
agreements outstanding,
end of period
(in thousands) .......... $ 458,391 $ 489,335 $ 395,559 $ 498,618
Asset coverage@ ........... $ 3,802 $ 3,531 $ 3,988 $ 3,740

- -------------
*Commencement of investment operations.
**Net asset value and market value published in The Wall Street Journal each
Monday.
#Net asset value immediately after the closing of the first public offering
was $9.44.
(d)Total investment return is calculated assuming a purchase of common stock
at the current market price on the first day and a sale at the current
market price on the last day of the periods reported. Dividends and
distributions, if any, are assumed, for purposes of this calculation, to
be reinvested at prices obtained under the Trust's dividend reinvestment
plan. Total investment return does not reflect brokerage commissions.
Total investment return for periods of less than one full year are not
annualized.
(d)(d)Annualized.
(ddd)The ratios of expenses, including excise taxes, to average net assets
were 0.63%, 0.63%, 0.68% and 0.64% for the periods indicated above,
respectively.
@Per $1,000 of reverse repurchase agreements outstanding.

The information above represents the unaudited operating performance data
for a share of common stock outstanding, total investment return, ratios
to average net assets and other supplemental data for the periods
indicated. This information has been determined based upon financial
information provided in the financial statements and market value data for
the Trust's shares.

See Notes to Financial Statements.

11
<PAGE>

(LEFT COLUMN)

- -------------------------------------------------------------------------------
The BlackRock 2001 Term Trust Inc.
Notes to Financial Statements
(Unaudited)
- -------------------------------------------------------------------------------
Note 1. Organization and Accounting Policies

The BlackRock 2001 Term Trust Inc. (the "Trust"), a Maryland corporation, is a
diversified, closed-end management investment company. The investment objective
of the Trust is to manage a portfolio of investment grade fixed income
securities that will return $10 per share (the initial public offering price per
share) to investors on or about June 30, 2001 while providing high monthly
income. The ability of issuers of debt securities held by the Trust to meet
their obligations may be affected by economic developments in a specific
industry or region. No assurance can be given that the Trust's investment
objective will be achieved.

The following is a summary of significant accounting policies followed by
the Trust:

Securities Valuation: The Trust values mortgage-backed, asset-backed, and other
debt securities on the basis of current market quotations provided by dealers or
pricing services approved by the Trust's Board of Directors. In determining the
value of a particular security, pricing services may use certain information
with respect to transactions in such securities, quotations from dealers, market
transactions in comparable securities, various relationships observed in the
market between securities, and calculated yield measures based on valuation
technology commonly employed in the market for such securities. Exchange-traded
options are valued at their last sales price as of the close of options trading
on applicable exchanges. In the absence of a last sale, options are valued at
the average of the quoted bid and asked prices as of the close of business. A
futures contract is valued at the last sale price as of the close of the
commodities exchange on which it trades unless the Trust's Board of Directors
determine that such price does not reflect its fair value, in which case it will
be valued at its fair value as determined by the Trust's Board of Directors. Any
securities or other assets for which such current market quotations are not
readily available are valued at fair market value as determined in good faith
under procedures established by and under the general supervision and
responsibility of the Trust's Board of Directors.

Short-term securities which mature in more than 60 days are valued at current
market quotations. Short-term securities which mature in 60 days or less are
valued at amortized

(RIGHT COLUMN)

cost, if their term to maturity from date of purchase was 60 days or less, or by
amortizing their value on the 61st day prior to maturity, if their original term
to maturity from date of purchase exceeded 60 days.

In connection with transactions in repurchase agreements, the Trust's
custodian takes possession of the underlying collateral securities, the value of
which at least equals the principal amount of the repurchase transaction,
including accrued interest. To the extent that any repurchase transaction
exceeds one business day, the value of the collateral is marked-to-market on a
daily basis to ensure the adequacy of the collateral. If the seller defaults and
the value of the collateral declines or if bankruptcy proceedings are commenced
with respect to the seller of the security, realization of the collateral by the
Trust may be delayed or limited.

Option Selling/Purchasing: When the Trust sells (or purchases) an option, an
amount equal to the premium received or paid by the Trust is recorded as a
liability or an asset and is subsequently adjusted to the current market value
of the option written (or purchased). Premiums received or paid from writing (or
purchasing) options which expire unexercised are treated by the Trust on the
expiration date as realized gains or losses. The difference between the premium
and the amount paid or received on effecting a closing purchase or sale
transaction, including brokerage commissions, is also treated as a realized gain
or loss. If an option is exercised, the premium paid or received is added to the
proceeds from the sale or cost of the purchase in determining whether the Trust
has realized a gain or a loss on investment transactions. The Trust, as writer
of an option, may have no control over whether the underlying securities may be
sold (call) or purchased (put) and as a result bears the market risk of an
unfavorable change in the price of the security underlying the written option.

Financial Futures Contracts: A futures contract is an agreement between two
parties to buy or sell a financial instrument for a set price on a future date.
Initial margin deposits are made upon entering into futures contracts and can be
either cash or securities. During the period that futures contract is open,
changes in the value of the contract are recognized as unrealized gains or
losses by "marking-to-market" on a daily basis to reflect the market value of
the contract at the end of each day's trading. Variation margin payments are
made or received, depending upon whether unrealized gains or losses are
incurred. When the contract is closed, the Trust records a realized gain or loss
equal to the difference between the proceeds from (or cost of) the closing
transaction and the Trust's basis in the contract.

12
<PAGE>
(LEFT CLUMN)

Financial futures contracts, when used by the Trust, help in maintaining a
targeted duration. Duration is a measure of the price sensitivity of a security
or a portfolio to relative changes in interest rates. For instance, a duration
of "one" means that a portfolio or a security's price would be expected to
change by approximately one percent with a one percent change in interest rates,
while a duration of "five" would imply that the price would move approximately
five percent in relation to a one percent change in interest rates. Futures
contracts can be sold to effectively shorten an otherwise longer duration
portfolio. In the same sense, futures contracts can be purchased to lengthen a
portfolio that is shorter than its duration target. Thus, by buying or selling
futures contracts, the Trust can effectively hedge more volatile positions so
that changes in interest rates do not change the duration of the portfolio
unexpectedly.

The Trust may invest in financial futures contracts primarily for the
purpose of hedging its existing portfolio securities or securities the Trust
intends to purchase against fluctuations in value caused by changes in
prevailing market interest rates. Should interest rates move unexpectedly, the
Trust may not achieve the anticipated benefits of the financial futures
contracts and may realize a loss. The use of futures transactions involves the
risk of imperfect correlation in movements in the price of futures contracts,
interest rates and the underlying hedged assets. The Trust is also at risk of
not being able to enter into a closing transaction for the futures contract
because of an illiquid secondary market. In addition, since futures are used to
shorten or lengthen a portfolio's duration, there is a risk that the portfolio
may have temporarily performed better without the hedge or that the Trust may
lose the opportunity to realize appreciation in the market price of the
underlying positions.

Short Sales: The Trust may make short sales of securities as a method of hedging
potential price declines in similar securities owned. When the Trust makes a
short sale, it may borrow the security sold short and deliver it to the
broker-dealer through which it made the short sale as collateral for its
obligation to deliver the security upon conclusion of the sale. The Trust may
have to pay a fee to borrow the particular securities and may be obligated to
pay over any payments received on such borrowed securities. A gain, limited to
the price at which the Trust sold the security short, or a loss, unlimited as to
dollar amount, will be recognized upon the termination of a short sale if the
market price is greater or less than the proceeds originally received.

Securities Lending: The Trust may lend its portfolio securities to qualified
institutions. The loans are secured by

(RIGHT COLUMN)

collateral at least equal, at all times, to the market value of the securities
loaned. The Trust may bear the risk of delay in recovery of, or even loss of
rights in, the securities loaned should the borrower of the securities fail
financially. The Trust receives compensation for lending its securities in the
form of interest on the loan. The Trust also continues to receive interest on
the securities loaned, and any gain or loss in the market price of the
securities loaned that may occur during the term of the loan will be for the
account of the Trust. The Trust did not engage in securities lending during the
six months ended December 31, 1995.

Interest Rate Floors: Interest rate floors are similar to interest rate swaps,
except that one party agrees to pay a fee, while the other party pays the excess
if any, of a floating rate under a specified fixed rate.

Interest rate floors are used by the Trust to both manage the duration of
the portfolio and its exposure to changes in short-term interest rates. Duration
is a measure of the price sensitivity of a security or a portfolio to relative
changes in interest rates. For instance, a duration of "one" means that a
portfolio's or a security's price would be expected to change by approximately
one percent with a one percent change in interest rates, while a duration of
"five" would imply that the price would move approximately five percent in
relation to a one percent change in interest rates. Owning interest rate floors
reduces the portfolio's duration, making it less sensitive to changes in
interest rates from a market value perspective. The effect on income involves
protection from falling short term rates, which the Trust experiences primarily
in the form of leverage.

The Trust is exposed to credit loss in the event of non-performance by the
other party to the interest rate floor. However, the Trust does not anticipate
non-performance by any counterparty.

Securities Transactions and Investment Income: Security transactions are
recorded on the trade date. Realized and unrealized gains and losses are
calculated on the identified cost basis. Interest income is recorded on the
accrual basis and the Trust amortizes premium and accretes discount on
securities purchased using the interest method.

Taxes: It is the Trust's intention to continue to meet the requirements of the
Internal Revenue Code applicable to regulated investment companies and to
distribute substantially all of its taxable income to shareholders. Therefore,
no federal income tax provision is required. As part of its tax planning
strategy, the Trust intends to retain a portion of its taxable income and pay an
excise tax on the undistributed amount.

13
<PAGE>

(LEFT COLUMN)

Dividends and Distributions: The Trust declares and pays dividends and
distributions monthly, first from net investment income, then from realized
short-term capital gains and other sources, if necessary. Net long-term capital
gains, if any, in excess of loss carryforwards, are distributed annually.
Dividends and distributions are recorded on the ex-dividend date.

Deferred Organization Expenses: A total of $75,000 was incurred in connection
with the organization of the Trust. These costs have been deferred and are being
amortized ratably over a period of sixty months from the date the Trust
commenced operations.

Note 2. Agreements

The Trust has an Investment Advisory Agreement with the Adviser and an
Administration Agreement with Mitchell Hutchins Asset Management Inc. (the
"Administrator"), a wholly-owned subsidiary of PaineWebber Incorporated.

The investment advisory fee paid to the Adviser is computed weekly and
payable monthly at an annual rate of 0.40% of the Trust's average weekly net
assets. The administration fee paid to the Administrator is also computed weekly
and payable monthly at an annual rate of 0.10% of the Trust's average weekly net
assets.

Pursuant to the agreements, the Adviser provides continuous supervision of
the investment portfolio and pays the compensation of officers of the Trust who
are affiliated persons of the Adviser. The Administrator pays occupancy and
certain clerical and accounting costs of the Trust. The Trust bears all other
costs and expenses.

On February 28, 1995, the Adviser was acquired by PNC Bank, NA. Following
the acquisition, the Adviser has become a wholly-owned corporate subsidiary of
PNC Asset Management Group, Inc., the holding company for PNC's asset management
businesses.

Note 3. Portfolio Securities

Purchases and sales of investment securities, other than short-term investments
and dollar rolls, for the six months ended December 31, 1995 aggregated
$2,170,969,174 and $2,083,379,972, respectively.

The Trust may invest up to 40% of its total assets in securities which are
not readily marketable, including those which are restricted as to disposition
under securities law ("restricted securities"). At December 31, 1995, the Trust
held 0.21% of its portfolio assets in illiquid securities including 0.18% of its
portfolio assets in securities restricted as to resale.

(RIGHT COLUMN)

The federal income tax basis of the Trust's investments at December 31, 1995
was the same as the basis for financial reporting and, accordingly, net
unrealized depreciation for federal income tax purposes was $19,037,951 (gross
unrealized appreciation-$40,485,145; gross unrealized depreciation-$59,523,096).

For federal income tax purposes, the Trust had a capital loss carryforward
at June 30, 1995 of approximately $24,284,000 of which $948,000 will expire in
2002, $19,902,000 will expire in 2001 and $3,434,000 will expire in 2000.
Accordingly, no capital gains distribution is expected to be paid to
shareholders until net gains have been realized in excess of such amount.

During the six months ended December 31, 1995, the Trust entered into
financial futures contracts. Details of open contracts at December 31, 1995 are
as follows:

Value at Value at
Number of Expiration Trade December 31, Unrealized
Contracts Type Date Date 1995 Appreciation
- --------- ---- ---------- -------- ------------ --------------
Long positions:
990 30 yr. T-Bond March 1996 $118,686,576 $120,254,062 $1,567,486
1 10 yr. T-Note March 1996 $118,113,599 $118,114,594 $1,567,995
-----------
$1,568,481
===========

The Trust entered into two interest rate floors which settled on November
10, 1995 and November 14, 1995 with notional amounts of $5 million and $2
million, respectively. Under the agreements, the Trust receives the excess, if
any, of one-month LIBOR over the fixed rates of 8.05% and 7.55%, respectively.
These agreements terminate on May 25, 2001. At December 31, 1995 unrealized
appreciation on the interest rate floors was $126,034.

Note 4. Borrowings Reverse Repurchase Agreements:

The Trust may enter into reverse repurchase agreements with qualified, third
party broker-dealers as determined by and under the direction of the Trust's
Board of Directors. Interest on the value of the reverse repurchase agreements
issued and outstanding will be based upon competitive market rates at the time
of issuance. At the time the Trust enters into a reverse repurchase agreement,
it will establish and maintain a segregated account with the lender the value of
which at least equals the principal amount of the reverse repurchase
transaction, including accrued interest.

The average daily balance of reverse repurchase agreements outstanding
during the six months ended December 31, 1995, was approximately $467,370,000 at
a weighted average interest rate of approximately 5.70%. The

14
<PAGE>

(LEFT COLUMN)

maximum amount of reverse repurchase agreements outstanding at any month end
during the six months ended December 31, 1995, was $458,391,213 as of December
31, 1995, which was 23.04% of total assets. The amount of reverse repurchase
agreements outstanding at December 31, 1995 was $458,391,213, which was 23.04%
of total assets.

Dollar Rolls: The Trust may enter into dollar rolls in which the Trust sells
securities for delivery in the current month and simultaneously contracts to
repurchase substantially similar (same type, coupon and maturity) securities on
a specified future date. During the roll period the Trust forgoes principal and
interest paid on the securities. The Trust will be compensated by the interest
earned on the cash proceeds of the initial sale and by the lower repurchase
price at the future date.

The average monthly balance of dollar rolls outstanding during the six
months ended December 31, 1995, was approximately $144,171,000. For the six
months ended

(Right Column)

December 31, 1995, the maximum amount of dollar rolls outstanding at any month
end was $191,759,700 as of September 30, 1995, which was 9.77% of total assets.

Note 5. Capital

There are 200 million shares of $.01 par value common stock authorized. Of the
142,010,583 common shares outstanding at December 31, 1995, the Adviser owned
10,583 shares.

Offering costs ($2,053,045) incurred in connection with the underwriting of
the Trust have been charged to paid-in capital in excess of par.

Note 6. Dividends

Subsequent to December 31, 1995, the Board of Directors of the Trust declared
dividends from undistributed earnings of $0.0375 per share payable January 31,
1996 and February 29, 1996 to shareholders of record on January 16, 1996 and
February 15, 1996, respectively.

Note 7. Quarterly Data

<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Net realized Net increase
and (decrease)
unrealized in net assets Dividends
Net investment gain (loss) resulting from and Period end
Quarterly Total income on investments operations Distributions Share price net asset
period income Amount Per share Amount Per share Amount Per share Amount Per share High Low value
--------- ------ ---------------- ---------------- ----------------- ----------------- ------------ -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
January 1, 1993 to
March 31, 1993 $32,023,760 $30,059,454 $0.21 $12,037,139 $0.09 $42,096,593 $0.30 $25,732,313 $0.18 $9-3/4 $9-1/8 $9.52
April 1, 1993 to
June 30, 1993 32,157,575 29,884,747 0.21 10,907,071 0.08 40,791,818 0.29 25,732,313 0.18 9-5/8 9-1/4 9.62
July 1, 1993 to
September 30, 1993 34,342,360 32,148,750 0.23 (17,558,331)(0.12) 14,590,419 0.11 25,732,301 0.18 9-5/8 9-1/4 9.54
October 1, 1993 to
December 31, 1993 20,386,901 18,194,749 0.13 (34,715,022)(0.25) (16,520,273)(0.12) 34,309,726 0.24 9-3/4 9 9.18
January 1, 1994 to
March 31, 1994 25,522,607 23,302,832 0.16 (90,128,903)(0.64) (66,826,071)(0.48) 16,565,515 0.12 9-3/8 8-1/8 8.60
April 1, 1994 to
June 30, 1994 18,719,408 16,581,572 0.12 (31,418,089)(0.22) (14,836,517)(0.10) 23,964,277 0.17 8-5/8 7-3/4 8.32
July 1, 1994 to
September 30, 1994 24,768,303 24,587,197 0.17 (14,674,730)(0.10) 9,912,467 0.07 23,964,278 0.17 8-1/4 7-3/8 8.23
October 1, 1994 to
December 31, 1994 23,422,397 19,730,413 0.14 (21,121,487)(0.14) (1,391,074) 0.00 23,964,272 0.17 7-7/8 7 8.05
January 1, 1995 to
March 31, 1995 21,633,042 19,861,828 0.14 50,559,812 0.35 70,421,640 0.49 20,415,369 0.14 7-5/8 7-1/4 8.40
April 1, 1995 to
June 30, 1995 23,732,271 21,879,601 0.16 44,206,107 0.31 66,085,708 0.47 20,415,375 0.15 8-1/4 7-1/2 8.72
July 1, 1995 to
September 30, 1995 21,981,739 19,972,420 0.14 (808,514)(0.00) 19,163,906 0.14 15,976,191 0.12 7-3/4 7-1/4 8.74
October 1, 1995 to
December 31, 1995 26,163,094 24,186,764 0.17 34,412,851 0.24 58,599,615 0.41 15,976,093 0.11 7-3/4 7-1/2 9.04
- ------------------------------------------------------------------------------------------------------------------------------------

</TABLE>

15
<PAGE>

- -------------------------------------------------------------------------------
THE BLACKROCK 2001 TERM TRUST INC.
TAX INFORMATION
- -------------------------------------------------------------------------------

We wish to advise you as to the federal tax status of dividends and
distributions paid by the Trust during its fiscal year ended December 31, 1995.

During the calendar year ended December 31, 1995, the Trust paid aggregate
dividends of $0.51252 per share from net investment income. For federal income
tax purposes, the aggregate of any dividends and short-term capital gains
distributions you received are reportable in your 1995 federal income tax return
as ordinary income. Further, we wish to advise you that your income dividends do
not qualify for the dividends received deduction.

For the purpose of preparing your 1995 annual federal income tax return,
however, you should report the amounts as reflected on the appropriate Form 1099
DIV which will be mailed to you in January 1996.

- -------------------------------------------------------------------------------
DIVIDEND REINVESTMENT PLAN
- -------------------------------------------------------------------------------

Pursuant to the Trust's Dividend Reinvestment Plan (the "Plan"),
shareholders may elect to have all distributions of dividends and capital gains
automatically reinvested by State Street Bank and Trust Company (the "Plan
Agent") in Trust shares pursuant to the Plan. Shareholders who do not
participate in the Plan will receive all distributions in cash paid by check in
United States dollars mailed directly to the shareholders of record (or if the
shares are held in street or other nominee name, then to the nominee) by the
custodian, as dividend disbursing agent.

The Plan Agent serves as agent for the shareholders in administering the
Plan. After the Trust declares a dividend or determines to make a capital gain
distribution, the Plan Agent will, as agent for the participants, receive the
cash payment and use it to buy Trust shares in the open market on the New York
Stock Exchange or elsewhere, for the participants' accounts. The Trust will not
issue shares under the Plan below net asset value.

Participants in the Plan may withdraw from the Plan upon written notice to
the Plan Agent and will receive certificates for whole Trust shares and a cash
payment will be made for any fraction of a Trust share.

The Plan Agent's fee for the handling of the reinvestment of dividends and
distributions will be paid by the Trust. However, each participant will pay a
pro rata share of brokerage commissions incurred with respect to the Plan
Agent's open market purchases in connection with the reinvestment of dividends
and distributions. The automatic reinvestment of dividends and distributions
will not relieve participants of any federal, state or local income taxes that
may be payable on such dividends or distributions.

Experience under the Plan may indicate that changes are desirable.
Accordingly, the Trust reserves the right to amend or terminate the Plan as
applied to any dividend or distribution paid subsequent to written notice of the
change sent to all shareholders of the Trust at least 90 days before the record
date for the dividend or distribution. The Plan also may be amended or
terminated by the Plan Agent upon at least 90 days' written notice to all
shareholders of the Trust. All correspondence concerning the Plan should be
directed to the Plan Agent at (800) 699-1BFM. The addresses are on the front of
this report.

- -------------------------------------------------------------------------------
ADDITIONAL INFORMATION
- -------------------------------------------------------------------------------

There have been no material changes in the Trust's investment objectives or
policies that have not been approved by the shareholders, or to its charter or
by-laws, or in the principal risk factors associated with investment in the
Trust. There have been no changes in the persons who are primarily responsible
for the day-to-day management of the Trust's portfolio.

16
<PAGE>

- -------------------------------------------------------------------------------
THE BLACKROCK 2001 TERM TRUST INC.
INVESTMENT SUMMARY
- -------------------------------------------------------------------------------

The Trust's Investment Objective

The Trust's investment objective is to manage a portfolio of investment grade
fixed income securities that will return $10 per share (the initial public
offering price per share) to investors on or about June 30, 2001 while providing
high monthly income.

Who Manages the Trust?

BlackRock Financial Management, Inc. ("BlackRock" or the "Adviser") is the
investment adviser for the Trust. BlackRock is a registered investment adviser
specializing in fixed income securities. Currently, BlackRock manages
approximately $34 billion of assets across the government, mortgage, corporate
and municipal sectors. These assets are managed on behalf of institutional and
individual investors in 21 closed-end funds, on either the New York Stock
Exchange or the American Stock Exchange, several open-end funds and separate
accounts for more than 80 clients in the U.S. and overseas. BlackRock is a
subsidiary of PNC Asset Management Group, Inc. which is a division of PNC Bank,
the nation's twelfth largest banking organization.

What Can the Trust Invest In?

The Trust may invest in all fixed income securities rated investment grade or
higher ("AAA", "AA", "A" or "BBB"). Examples of securities in which the Trust
may invest include U.S. government and government agency securities, zero coupon
securities, mortgage-backed securities, corporate debt securities, asset-backed
securities, U.S. dollar-denominated foreign debt securities and municipal
securities. Under current market conditions, BlackRock expects that the primary
investments of the Trust will be U.S. government securities, securities backed
by government agencies (such as mortgage-backed securities) and corporate debt
securities.

What is the Adviser's Investment Strategy?

The Adviser will seek to meet the Trust's investment objective by managing the
assets of the Trust so as to return the initial offering price ($10 per share)
at maturity. The Trust will implement a conservative strategy that will seek to
closely match the maturity of the assets of the portfolio with the future return
of the initial investment in June of 2001. At the Trust's termination, BlackRock
expects that the value of the securities which have matured, combined with the
value of the securities that are sold will be sufficient to return the initial
offering price to investors. On a continuous basis, the Trust will seek its
objective by actively managing its assets in relation to market conditions,
interest rate changes and, importantly, the remaining term to maturity of the
Trust.

In addition to seeking the return of the initial offering price, the Adviser
also seeks to provide high monthly income to investors. The portfolio managers
will attempt to achieve this objective by investing in securities that provide
competitive income. In addition, leverage will be used (in an amount up to
33-1/3% of total assets) to enhance the income of the portfolio. In order to
maintain competitive yields as the Trust approaches maturity and depending on
market conditions, the Adviser will attempt to purchase securities with call
protection or maturities as close to the Trust's maturity date as possible.
Securities with call protection should provide the portfolio with some degree of
protection against reinvestment risk during times of lower prevailing interest
rates. Since the Trust's primary goal is to return the initial offering price at
maturity, any cash that the Trust receives prior to its maturity date (i.e. cash
from early and regularly scheduled payments of principal on mortgage-backed
securities) will be reinvested in securities with maturities which coincide with
the remaining term of the Trust. Since shorter-term securities typically yield
less than longer-term securities, this strategy will likely result in a decline
in the Trust's income over time. However, the Adviser will attempt to maintain a
yield which is competitive with a comparable maturity Treasury at the same point
on the yield curve (i.e. if the Trust has three years left until its maturity,
the Adviser will attempt to maintain a yield at a spread over a 3-year
Treasury). It is important to note that the Trust will be managed so as to
preserve the integrity of the return of the initial offering price.

17
<PAGE>

How Are the Trust's Shares Purchased and Sold? Does the Trust Pay Dividends
Regularly?

The Trust's shares are traded on the New York Stock Exchange which provides
investors with liquidity on a daily basis. Orders to buy or sell shares of the
Trust must be placed through a registered broker or financial advisor. The Trust
pays monthly dividends which are typically paid on the last business day of the
month. For shares held in the shareholder's name, dividends may be reinvested in
additional shares of the fund through the Trust's transfer agent, Boston
Financial Data Services. Investors who wish to hold shares in a brokerage
account should check with their financial advisor to determine whether their
brokerage firm offers dividend reinvestment services.

Leverage Considerations in a Term Trust

Under current market conditions, leverage increases the income earned by the
Trust. The Trust employs leverage primarily through the use of reverse
repurchase agreements and dollar rolls. Leverage permits the Trust to borrow
money at short-term rates and reinvest that money in longer-term assets which
typically offer higher interest rates. The difference between the cost of the
borrowed funds and the income earned on the proceeds that are invested in longer
term assets is the benefit to the Trust from leverage. In general, the portfolio
is typically leveraged at approximately 33-1/3% of total assets.

Leverage also increases the duration (or price volatility of the net assets) of
the Trust, which can improve the performance of the fund in a declining rate
environment, but can cause net assets to decline faster than the market in a
rising rate environment. BlackRock's portfolio managers continuously monitor and
regularly review the Trust's use of leverage and the Trust may reduce, or
unwind, the amount of leverage employed should BlackRock consider that reduction
to be in the best interests of the shareholders.

Special Considerations and Risk Factors Relevant to Term Trusts

The Trust is intended to be a long-term investment and is not a short-term
trading vehicle.

Return of Initial Investment. Although the objective of the Trust is to return
its initial offering price upon termination, there can be no assurance that this
objective will be achieved.

Dividend Considerations. The income and dividends paid by the Trust are likely
to decline to some extent over the term of the Trust due to the anticipated
shortening of the dollar-weighted average maturity of the Trust's assets.

Leverage. The Trust utilizes leverage through reverse repurchase agreements and
dollar rolls, which involves special risks. The Trust's net asset value and
market value may be more volatile due to its use of leverage.

Market Price of Shares. The shares of closed-end investment companies such as
the Trust trade on the New York Stock Exchange and as such are subject to supply
and demand influences. As a result, shares may trade at a discount or a premium
to their net asset value.

Mortgage-Backed and Asset-Backed Securities. The cash flow and yield
characteristics of these securities differ from traditional debt securities. The
major differences typically include more frequent payments and the possibility
of prepayments which will change the yield to maturity of the security.

Corporate Debt Securities. The value of corporate debt securities generally
varies inversely with changes in prevailing market interest rates. The Trust may
be subject to certain reinvestment risks in environments of declining interest
rates.

Zero Coupon Securities. Such securities receive no cash flows prior to maturity,
therefore, interim price movements on these securities are generally more
sensitive to interest rate movements than securities that make periodic coupon
payments. These securities appreciate in value over time and can play an
important role in helping the Trust achieve its primary objective.

Illiquid Securities. The Trust may invest in securities that are illiquid,
although under current market conditions the Trust expects to do so to only a
limited extent. These securities involve special risks.

Non-U.S Securities. The Trust may invest less than 10% of its total assets in
non-U.S. dollar-denominated securities which involve special risks such as
currency, political and economic risks, although under current market conditions
does not do so.

Antitakeover Provisions. Certain antitakeover provisions will make a change in
the Trust's business or management more difficult without the approval of the
Trust's Board of Directors and may have the effect of depriving shareholders of
an opportunity to sell their shares at a premium above the prevailing market
price.

18
<PAGE>

- -------------------------------------------------------------------------------
THE BLACKROCK 2001 TERM TRUST INC.
ANNUAL REPORT TO SHAREHOLDERS
GLOSSARY
- -------------------------------------------------------------------------------

Adjustable Rate Mortgage-
Backed Securities (ARMs): Mortgage instruments with interest rates that adjust at periodic intervals at a fixed amount
over the market levels of interest rates as reflected in specified indexes. ARMS are backed by
mortgage loans secured by real property.

Asset-Backed Securities: Securities backed by various types of receivables such as automobile and credit card receivables.

Closed-End Fund: Investment vehicle which initially offers a fixed number of shares and trades on a stock exchange.
The fund invests in a portfolio of securities in accordance with its stated investment objectives
and policies.

Collateralized Mortgage
Obligations (CMOs): Mortgage-backed securities which separate mortgage pools into short-, medium-, and long-term
securities with different priorities for receipt of principal and interest. Each class is paid a
fixed or floating rate of interest at regular intervals. Also known as multiple-class mortgage
pass-throughs.

Discount: When a fund's net asset value is greater than its stock price the fund is said to be trading at a
discount.

Dividend: This is income generated by securities in a portfolio and distributed to shareholders after the
deduction of expenses. This Trust declares and pays dividends on a monthly basis.

Dividend Reinvestment: Shareholders may elect to have all dividends and distributions of capital gains automatically
reinvested into additional shares of the Trust.

FHA: Federal Housing Administration, a government agency that facilitates a secondary mortgage market by
providing an agency that guarantees timely payment of interest and principal on mortgages.

FHLMC: Federal Home Loan Mortgage Corporation, a publicly owned, federally chartered corporation that
facilitates a secondary mortgage market by purchasing mortgages from lenders such as savings
institutions and reselling them to investors by means of mortgage-backed securities. Obligations of
FHLMC are not guaranteed by the U.S. government, however; they are backed by FHLMC's authority to
borrow from the U.S. government. Also known as Freddie Mac.

FNMA: Federal National Mortgage Association, a publicly owned, federally chartered corporation that
facilitates a secondary mortgage market by purchasing mortgages from lenders such as savings
institutions and reselling them to investors by means of mortgage-backed securities. Obligations of
FNMA are not guaranteed by the U.S. government, however; they are backed by FNMA's authority to
borrow from the U.S. government. Also known as Fannie Mae.

GNMA: Government National Mortgage Association, a U.S. government agency that facilitates a secondary
mortgage market by providing an agency that guarantees timely payments of interest and principal on
mortgages. GNMA's obligations are supported by the full faith and credit of the U.S. Treasury. Also
known as Ginnie Mae.

Government Securities: Securities issued or guaranteed by the U.S. government, or one of its agencies or instrumentalities,
such as GNMA (Government National Mortgage Association), FNMA (Federal National Mortgage
Association) and FHLMC (Federal Home Loan Mortgage Corporation).
</TABLE>

19
<PAGE>

Interest-Only Securities (I/O): Mortgage securities that receive only the interest cash flows from an underlying pool of mortgage
loans or underlying pass-through securities. Also known as a strip.

Market Price: Price per share of a security trading in the secondary market. For a closed-end fund, this is the
price at which one share of the fund trades on the stock exchange. If you were to buy or sell
shares, you would pay or receive the market price.

Mortgage Dollar Rolls: A mortgage dollar roll is a transaction in which the Trust sells mortgage-backed securities for
delivery in the current month and simultaneously contracts to repurchase substantially similar
(although not the same) securities on a specified future date. During the "roll" period, the Trust
does not receive principal and interest payments on the securities, but is compensated for giving up
these payments by the difference in the current sales price (for which the security is sold) and
lower price that the Trust pays for the similar security at the end date as well as the interest
earned on the cash proceeds of the initial sale.

Mortgage Pass-Throughs: Mortgage-backed securities issued by Fannie Mae, Freddie Mac or Ginnie Mae.

Multiple-Class Pass-Throughs: Collateralized Mortgage Obligations.

Net Asset Value (NAV): Net asset value is the total market value of all securities and other assets held by the Trust,
plus income accrued on its investments, minus any liabilities including accrued expenses, divided by
the total number of outstanding shares. It is the underlying value of a single share on a given day.
Net asset value for the Trust is calculated weekly and published in Barron's on Saturday and The New
York Times or The Wall Street Journal each Monday.

Principal-Only Securities(P/O): Mortgage securities that receive only the principal cash flows from an underlying pool of mortgage
loans or underlying pass-through securities. Also known as a strip.

Project Loans: Mortgages for multi-family, low- to middle-income housing.

Premium: When a fund's stock price is greater than its net asset value, the fund is said to be trading at a
premium.

REMIC: A real estate mortgage investment conduit is a multiple-class security backed by mortgage-backed
securities or whole mortgage loans and formed as a trust, corporation, partnership, or segregated
pool of assets that elects to be treated as a REMIC for federal tax purposes. Generally, Fannie Mae
REMICs are formed as trusts and are backed by mortgage-backed securities.

Residuals: Securities issued in connection with collateralized mortgage obligations that generally represent
the excess cash flow from the mortgage assets underlying the CMO after payment of principal and
interest on the other CMO securities and related administrative expenses.

Reverse Repurchase
Agreements: In a reverse repurchase agreement, the Trust sells securities and agrees to repurchase them at a
mutually agreed date and price. During this time, the Trust continues to receive the principal and
interest payments from that security. At the end of the term, the Trust receives the same securities
that were sold for the same initial dollar amount plus interest on the cash proceeds of the initial
sale.

Stripped Mortgage-Backed
Securities: Arrangements in which a pool of assets is separated into two classes that receive different
proportions of the interest and principal distributions from underlying mortgage-backed securities.
IO's and PO's are examples of strips.
</TABLE>

20
<PAGE>

- -------------------------------------------------------------------------------
BlackRock Financial Management, Inc.
Summary of Closed-End Funds
- -------------------------------------------------------------------------------
Taxable Trusts
- -------------------------------------------------------------------------------
Termination
Stock Symbol Date
------------ ----------
Perpetual Trusts
The BlackRock Income Trust Inc. .................... BKT N/A
The BlackRock North American Government
Income Trust Inc. ............................... BNA N/A

Term Trusts
The BlackRock 1998 Term Trust Inc. ................. BBT 12/98
The BlackRock 1999 Term Trust Inc. ................. BNN 12/99
The BlackRock Target Term Trust Inc. ............... BTT 12/00
The BlackRock 2001 Term Trust Inc. ................. BLK 06/01
The BlackRock Strategic Term Trust Inc. ............ BGT 12/02
The BlackRock Investment Quality Term Trust Inc. ... BQT 12/04
The BlackRock Advantage Term Trust Inc. ............ BAT 12/05
The BlackRock Broad Investment Grade 2009
Term Trust Inc. ................................. BCT 12/09

Tax-Exempt Trusts
- -------------------------------------------------------------------------------
Termination
Stock Symbol Date
------------ ----------
Perpetual Trusts
The BlackRock Investment Quality Municipal
Trust Inc. ....................................... BKN N/A
The BlackRock California Investment Quality
Municipal Trust Inc. ............................. RAA N/A
The BlackRock Florida Investment Quality
Municipal Trust .................................. RFA N/A
The BlackRock New Jersey Investment Quality
Municipal Trust Inc. ............................. RNJ N/A
The BlackRock New York Investment Quality
Municipal Trust Inc. ............................. RNY N/A

Term Trusts
The BlackRock Municipal Target Term Trust Inc. ..... BMN 12/06
The BlackRock Insured Municipal 2008 Term
Trust Inc. ....................................... BRM 12/08
The BlackRock California Insured Municipal
2008 Term Trust Inc. ............................. BFC 12/08
The BlackRock Florida Insured Municipal
2008 Term Trust .................................. BRF 12/08
The BlackRock New York Insured Municipal
2008 Term Trust Inc. ............................. BLN 12/08
The BlackRock Insured Municipal Term Trust Inc. .... BMT 12/10

If you would like further information please call BlackRock at (800)
227-7BFM or consult with your financial advisor BlackRock

<PAGE>

- --------------------------------------------------------------------------------
BlackRock Financial Management, Inc.
An Overview
- --------------------------------------------------------------------------------

BlackRock Financial Management Inc. (BlackRock) is a registered investment
adviser which specializes in managing high quality fixed income securities, both
taxable and tax exempt. BlackRock currently manages approximately $34 billion of
assets across the government, mortgage, corporate and municipal sectors. These
assets are managed on behalf of institutional and individual investors in 21
closed-end funds traded on either the New York Stock Exchange or American Stock
Exchange, several open-end funds and over 80 institutional clients in the United
States and overseas. BlackRock's institutional investor base includes Chrysler
Corporation Master Retirement Trust, General Retirement System of the City of
Detroit, State Treasurer of Florida, Ford Motor Company Pension Plan, General
Electric Pension Trust and Unisys Corporation Master Trust.

BlackRock was formed in April 1988 by fixed income professionals who sought
to create an asset management firm specializing in managing fixed income
securities for individuals and institutional investors. The professionals at
BlackRock have extensive experience creating, analyzing and trading a variety of
fixed income instruments, including the most complex structured securities. In
fact, individuals at BlackRock are responsible for many of the major innovations
in the mortgage-backed and asset-backed securities market, including the
creation of the CMO, the floating rate CMO, the senior/subordinated pass-through
and the multi-class asset-backed security.

BlackRock is unique among asset management and advisory firms in the
significant emphasis it places on the development of propriety analytical
capabilities. A quarter of the professionals at BlackRock work full-time in the
design, maintenance and use of such systems which are otherwise not generally
available to investors. BlackRock's propriety analytical tools are used for
evaluating, investing in and designing investment strategies and portfolio of
fixed income securities, including mortgage securities, corporate debt
securities or tax-exempt securities and a variety of hedging instruments.

BlackRock has developed investment products which respond to investors'
needs and has been responsible for several major innovations in closed-end
funds. BlackRock introduced the first closed-end mortgage fund, the first
taxable and tax-exempt closed-end funds to offer a finite term, the first
closed-end fund to achieve a AAA Rating by S&P and the first closed fund to
invest primarily in North American Government securities. BlackRock's closed-end
funds currently have dividend reinvestment plans which are designed to provide
an ongoing source of demand for the stock in the secondary market. BlackRock
manages a ladder of alternative investment vehicles, with each fund having
specific investment objectives and policies.

In view of our continued desire to provide a high level of service to all of
our shareholders, BlackRock maintains a toll-free number for your questions. The
number is (800) 227-7BFM (7236). We encourage you to call us with any questions
you may have about your BlackRock funds and thank you for the continued trust
you place in our abilities.

<PAGE>

(Left column)

Directors
Laurence D. Fink, Chairman
Andrew F. Brimmer
Richard E. Cavanagh
Kent Dixon
Frank J. Fabozzi
James Grosfeld
James Clayburn La Force, Jr.
Ralph L. Schlosstein
Officers
Ralph L. Schlosstein, President
Scott Amero, Vice President
Keith T. Anderson, Vice President
Michael C. Huebsch, Vice President
Robert S. Kapito, Vice President
Richard M. Shea, Vice President/Tax
Henry Gabbay, Treasurer
James Kong, Assistant Treasurer
Kevin J. Mahoney, Assistant Treasurer
Karen H. Sabath, Secretary
Investment Adviser
BlackRock Financial Management, Inc.
345 Park Avenue
New York, NY 10154
(800) 227-7BFM
Administrator
Mitchell Hutchins Asset Management Inc.
1285 Avenue of the Americas
New York, NY 10019
Custodian and Transfer Agent
State Street Bank and Trust Company
One Heritage Drive
North Quincy, MA 02171
(800) 699-1BFM
Independent Auditors
Deloitte & Touche LLP
Two World Financial Center
New York, NY 10281-1434
Legal Counsel
Skadden, Arps, Slate, Meagher & Flom
919 Third Avenue
New York, NY 10022

This report is for shareholder information.
This is not a prospectus intended for use in the
purchase or sale of Trust shares.

The accompanying financial statements as of
December 31, 1995 were not audited and accordingly,
no opinion is expressed on them.

The BlackRock 2001 Term Trust Inc.
c/o Mitchell Hutchins Asset Management Inc.
15th Floor
1285 Avenue of the Americas
New York, NY 10019
(800) 227-7BFM

092477-10-8

(Right column)

The BlackRock
2001 Term Trust Inc.
- ---------------------
Semi-Annual Report
December 31, 1995