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<PAGE> PAGE 2
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SIGNATURE JULIAN F.SLUYTERS
TITLE TREASURER
<TABLE> <S> <C>
<ARTICLE> 6
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1995
<PERIOD-START> OCT-01-1994
<PERIOD-END> SEP-30-1995
<INVESTMENTS-AT-COST> 229,391
<INVESTMENTS-AT-VALUE> 238,826
<RECEIVABLES> 4,375
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 157
<TOTAL-ASSETS> 243,358
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 452
<TOTAL-LIABILITIES> 452
<SENIOR-EQUITY> 80,000
<PAID-IN-CAPITAL-COMMON> 153,674
<SHARES-COMMON-STOCK> 10,357
<SHARES-COMMON-PRIOR> 10,357
<ACCUMULATED-NII-CURRENT> 247
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (450)
<OVERDISTRIBUTION-GAINS> 0
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<DIVIDEND-INCOME> 0
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<OTHER-INCOME> 0
<EXPENSES-NET> (2,619)
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<EQUALIZATION> 0
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<DISTRIBUTIONS-OF-GAINS> 0
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<INTEREST-EXPENSE> 0
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<PER-SHARE-NAV-BEGIN> 14.72
<PER-SHARE-NII> 1.18
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</TABLE>
November 15, 1995
To the Board of Directors of
Investment Grade Municipal Income
Fund
(formerly PaineWebber Premier Tax-
Free Income Fund Inc.)
In planning and performing our audit
of the financial statements of
Investment Grade Municipal Income
Fund (the Fund ) for the year ended
September 30, 1995, we considered
its internal control structure,
including procedures for safeguarding
securities, in order to determine our
auditing procedures for the purpose
of expressing our opinion on the
financial statements and to comply
with the requirements of Form
N-SAR, and not to provide assurance
on the internal control structure.
The management of the Fund is
responsible for establishing and
maintaining an internal control
structure. In fulfilling this
responsibility, estimates and
judgments by management are
required to assess the expected
benefits and related costs of internal
control structure policies and
procedures. Two of the objectives of
an internal control structure are to
provide management with reasonable,
but not absolute, assurance that assets
are appropriately safeguarded against
loss from unauthorized use or
disposition and that transactions are
executed in accordance with
management's authorization and
recorded properly to permit
preparation of financial statements in
conformity with generally accepted
accounting principles.
Because of inherent limitations in any
internal control structure, errors or
irregularities may occur and may not
be detected. Also, projection of any
evaluation of the structure to future
periods is subject to the risk that it
may become inadequate because of
changes in conditions or that the
effectiveness of the design and
operation may deteriorate.
Our consideration of the internal
control structure would not
necessarily disclose all matters in the
internal control structure that might
be material weaknesses under
standards established by the
American Institute of Certified Public
Accountants. A material weakness is
a condition in which the design or
operation of the specific internal
control structure elements does not
reduce to a relatively low level the
risk that errors or irregularities in
amounts that would be material in
relation to the financial statements
being audited may occur and not be
detected within a timely period by
employees in the normal course of
performing their assigned functions.
However, we noted no matters
involving the internal control
structure, including procedures for
safeguarding securities, that we
consider to be material weaknesses as
defined above as of September 30,
1995.
This report is intended solely for the
information and use of management
and the Securities and Exchange
Commission.
PRICE WATERHOUSE LLP
New York, New York
