<PAGE> PAGE 1
000 A000000 06/30/99
000 C000000 0000914248
000 D000000 N
000 E000000 NF
000 F000000 Y
000 G000000 N
000 H000000 N
000 I000000 3.0.a
000 J000000 A
001 A000000 SPECIAL SITUATIONS FUND III, L.P.
001 B000000 811-8110
001 C000000 2128325300
002 A000000 153 EAST 53RD STREET, 51ST FLOOR
002 B000000 NEW YORK
002 C000000 NY
002 D010000 10022
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008 A000001 MGP ADVISERS LIMITED PARTNERSHIP
008 B000001 A
008 C000001 801-24027
008 D010001 NEW YORK
008 D020001 NY
008 D030001 10022
010 A000001 AWM INVESTMENT COMPANY, INC.
010 C010001 NEW YORK
010 C020001 NY
<PAGE> PAGE 2
010 C030001 10022
013 A000001 ANCHIN, BLOCK & ANCHIN
013 B010001 NEW YORK
013 B020001 NY
013 B030001 10018
015 A000001 PRUDENTIAL SECURITIES, INC.
015 B000001 C
015 C010001 NEW YORK
015 C020001 NY
015 C030001 10292
015 E020001 X
018 000000 Y
019 A000000 N
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020 A000001 WILLIAMS FINANCIAL GROUP
020 B000001 75-2237860
020 C000001 100
020 A000002 INSTINET CORPORATION
020 B000002 13-3443395
020 C000002 40
020 A000003 MERRILL LYNCH PIERCE, FENNER & SMITH, INC.
020 B000003 13-5674085
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020 A000004 TUCKER ANTHONY
020 B000004 04-2566229
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020 A000005 LEHMAN BROTHERS, INC.
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020 B000006 13-5108880
020 C000006 12
020 A000007 WHEAT FIRST BUTCHER SINGER
020 B000007 54-1173416
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020 A000008 WILLIAM BLAIR & CO.
020 B000008 36-2214610
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020 A000009 CRUTTENDEN & COMPANY
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020 C000010 8
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022 A000001 HERZOG HEINE GEDULD
022 B000001 13-1955436
022 C000001 4204
022 D000001 10547
022 A000002 HAMBRECHT & QUIST
022 B000002 94-2856935
<PAGE> PAGE 3
022 C000002 7385
022 D000002 6149
022 A000003 DAIN RAUSCHER INCORPORATED
022 B000003 41-1416338
022 C000003 4662
022 D000003 3562
022 A000004 USCC TRADING
022 B000004 13-2967453
022 C000004 231
022 D000004 7595
022 A000005 VECTOR SECURITIES INTERNATIONAL
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022 C000005 7099
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022 A000006 FURMAN SELZ INCORPORATED
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022 C000006 3909
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022 A000007 ROBERTSON STEPHENS & COMPANY
022 B000007 94-2524501
022 C000007 3423
022 D000007 2216
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022 C000008 3677
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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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<PAGE> PAGE 8
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<PAGE> PAGE 9
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SIGNATURE AUSTIN W. MARXE
TITLE INDIVIDUAL G. P.
<TABLE> <S> <C>
<ARTICLE> 6
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> JUN-30-1999
<INVESTMENTS-AT-COST> 119630
<INVESTMENTS-AT-VALUE> 140681
<RECEIVABLES> 4207
<ASSETS-OTHER> 24
<OTHER-ITEMS-ASSETS> 10030
<TOTAL-ASSETS> 154942
<PAYABLE-FOR-SECURITIES> 2236
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 11268
<TOTAL-LIABILITIES> 13504
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 5657
<SHARES-COMMON-PRIOR> 5394
<ACCUMULATED-NII-CURRENT> 0<F1>
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 21274
<NET-ASSETS> 141438
<DIVIDEND-INCOME> 133
<INTEREST-INCOME> 175
<OTHER-INCOME> 0
<EXPENSES-NET> 758
<NET-INVESTMENT-INCOME> (450)
<REALIZED-GAINS-CURRENT> 10581
<APPREC-INCREASE-CURRENT> 1309
<NET-CHANGE-FROM-OPS> 11440
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 6597<F2>
<NUMBER-OF-SHARES-SOLD> 70
<NUMBER-OF-SHARES-REDEEMED> 264
<SHARES-REINVESTED> 458<F3>
<NET-CHANGE-IN-ASSETS> 6593
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 758
<AVERAGE-NET-ASSETS> 138439
<PER-SHARE-NAV-BEGIN> 25000
<PER-SHARE-NII> 0<F4>
<PER-SHARE-GAIN-APPREC> 0<F4>
<PER-SHARE-DIVIDEND> 0<F4>
<PER-SHARE-DISTRIBUTIONS> 0<F4>
<RETURNS-OF-CAPITAL> 0<F5>
<PER-SHARE-NAV-END> 25000
<EXPENSE-RATIO> 1.1
<FN>
<F1>This item is not applicable to financial statements of a
Partnership.
<F2>This amount represents repurchases of Units.
<F3>The Fund allocates additional units at the close of each
fiscal period in order to maintain a $25,000 price per unit.
This is the amount shown here as reinvested.
<F4>These are not meaningful for the Partnership.
<F5>No amounts are shown here as they may be misleading. The
returns vary depending on when a partner invested.
</FN>
</TABLE>
