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<PAGE> PAGE 2
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<PAGE> PAGE 3
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<PAGE> PAGE 4
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<PAGE> PAGE 5
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<PAGE> PAGE 6
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<PAGE> PAGE 7
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SIGNATURE GORDON H. SILVER
TITLE VICE PRESIDENT
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM Putnam Investment
Grade Municipal Trust III IS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1994
<PERIOD-END> OCT-31-1994
<INVESTMENTS-AT-COST> 67,430,292
<INVESTMENTS-AT-VALUE> 62,648,013
<RECEIVABLES> 4,150,638
<ASSETS-OTHER> 134,041
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 66,932,692
<PAYABLE-FOR-SECURITIES> 6,625,578
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 788,989
<TOTAL-LIABILITIES> 7,414,567
<SENIOR-EQUITY> 10,000,000
<PAID-IN-CAPITAL-COMMON> 55,817,217
<SHARES-COMMON-STOCK> 4,007,092
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 477,179
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (1,993,992)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> (4,782,279)
<NET-ASSETS> 59,518,125
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 3,833,494
<OTHER-INCOME> 0
<EXPENSES-NET> 456,894
<NET-INVESTMENT-INCOME> 3,376,600
<REALIZED-GAINS-CURRENT> (1,993,992)
<APPREC-INCREASE-CURRENT> (4,782,279)
<NET-CHANGE-FROM-OPS> (3,399,671)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (2,672,823)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> (226,598)
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 59,418,125
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 392,105
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 456,894
<AVERAGE-NET-ASSETS> 53,524,615
<PER-SHARE-NAV-BEGIN> 14.02
<PER-SHARE-NII> .85
<PER-SHARE-GAIN-APPREC> (1.69)
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> (.73)
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 12.36
<EXPENSE-RATIO> .85
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
