DEFINED ASSET FUNDS MUNICIPAL INVT TR FD MULTISTATE SER 97
497, 2001-01-19
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                           DEFINED ASSET FUNDS-REGISTERED TRADEMARK-
                           ----------------------------------------------------

                           MUNICIPAL INVESTMENT TRUST FUND
                           MULTISTATE SERIES--97
                           (A UNIT INVESTMENT TRUST)

                           -  CALIFORNIA, NEW JERSEY, NEW YORK AND PENNSYLVANIA
                              PORTFOLIOS
                           -  PORTFOLIOS OF INSURED LONG-TERM MUNICIPAL BONDS
                           -  DESIGNED TO BE FREE OF REGULAR FEDERAL INCOME TAX
                           -  EXEMPT FROM SOME STATE TAXES
                           -  MONTHLY DISTRIBUTIONS

SPONSORS:
MERRILL LYNCH,
PIERCE, FENNER & SMITH
INCORPORATED               -----------------------------------------------------
SALOMON SMITH BARNEY INC.  The Securities and Exchange Commission has not
PRUDENTIAL SECURITIES      approved or disapproved these Securities or passed
INCORPORATED               upon the adequacy of this prospectus. Any
PAINEWEBBER INCORPORATED   representation to the contrary is a criminal offense.
DEAN WITTER REYNOLDS INC.  Prospectus dated January 19, 2001.

<PAGE>
--------------------------------------------------------------------------------

Defined Asset Funds-Registered Trademark-
Defined Asset Funds-Registered Trademark- is America's oldest and largest family
of unit investment trusts, with over $195 billion sponsored over the last 30
years. Defined Asset Funds has been a leader in unit investment trust research
and product innovation. Our family of Funds helps investors work toward their
financial goals with a full range of quality investments, including municipal,
corporate and government bond portfolios, as well as domestic and international
equity portfolios.

Defined Asset Funds offer a number of advantages:
   - A Disciplined strategy of buying and holding with a long-term view is the
     cornerstone of Defined Asset Funds.
   - Fixed portfolio: Defined Funds follow a buy and hold investment strategy;
     funds are not managed and portfolio changes are limited.
   - Defined Portfolios: We choose the stocks and bonds in advance, so you know
     what you're investing in.
   - Professional research: Our dedicated research team seeks out stocks or
     bonds appropriate for a particular fund's objectives.
   - Ongoing supervision: We monitor each portfolio on an ongoing basis.

No matter what your investment goals, tolerance for risk or time horizon,
there's probably a Defined Asset Fund that suits your investment style. Your
financial professional can help you select a Defined Asset Fund that works best
for your investment portfolio.

THE FINANCIAL INFORMATION IN THIS PROSPECTUS IS AS OF OCTOBER 31, 2000, THE
EVALUATION DATE.

CONTENTS

<TABLE>
<CAPTION>
                                                    PAGE
                                                    ----
<S>                                                 <C>
California Insured Portfolio--
  Risk/Return Summary.............................    3
New Jersey Insured Portfolio--
  Risk/Return Summary.............................    6
New York Insured Portfolio--
  Risk/Return Summary.............................    9
Pennsylvania Insured Portfolio--
  Risk/Return Summary.............................   12
What You Can Expect From Your Investment..........   16
  Monthly Income..................................   16
  Return Figures..................................   16
  Records and Reports.............................   16
The Risks You Face................................   17
  Interest Rate Risk..............................   17
  Call Risk.......................................   17
  Reduced Diversification Risk....................   17
  Liquidity Risk..................................   17
  Concentration Risk..............................   17
  State Concentration Risk........................   18
  Bond Quality Risk...............................   21
  Insurance Related Risk..........................   21
  Litigation and Legislation Risks................   21
Selling or Exchanging Units.......................   21
  Sponsors' Secondary Market......................   22
  Selling Units to the Trustee....................   22
  Exchange Option.................................   22
How The Fund Works................................   23
  Pricing.........................................   23
  Evaluations.....................................   23
  Income..........................................   23
  Expenses........................................   23
  Portfolio Changes...............................   24
  Fund Termination................................   24
  Certificates....................................   24
  Trust Indenture.................................   25
  Legal Opinion...................................   25
  Auditors........................................   26
  Sponsors........................................   26
  Trustee.........................................   26
  Underwriters' and Sponsors' Profits.............   26
  Public Distribution.............................   26
  Code of Ethics..................................   26
Taxes.............................................   27
Supplemental Information..........................   29
Financial Statements..............................  D-1
</TABLE>

                                       2
<PAGE>
--------------------------------------------------------------------------------

CALIFORNIA INSURED PORTFOLIO--RISK/RETURN SUMMARY

 1. WHAT IS THE FUND'S OBJECTIVE?
   The Fund seeks interest income that is exempt from regular federal income
   taxes and some state and local taxes by investing in a fixed portfolio
   consisting primarily of insured, long term municipal revenue bonds.

 2. WHAT ARE MUNICIPAL REVENUE BONDS?
   Municipal revenue bonds are bonds issued by states, municipalities and public
   authorities to finance the cost of buying, building or improving various
   projects intended to generate revenue, such as airports, health care
   facilities, housing and municipal electric, water and sewer utilities.
   Generally, payments on these bonds depend solely on the revenues generated by
   the projects, excise taxes or state appropriations, and are not backed by the
   government's taxing power.

 3. WHAT IS THE FUND'S INVESTMENT STRATEGY?
 - The Fund plans to hold to maturity 7 long-term tax-exempt municipal bonds
   with an aggregate face amount of $4,265,000.

 - The Fund is a unit investment trust which means that, unlike a mutual fund,
   the Portfolio is not managed.

 - The bonds are rated AAA or Aaa by Standard & Poor's, Moody's or Fitch.

 - Many of the bonds can be called at a premium declining over time to par
   value. Some bonds may be called earlier at par for extraordinary reasons.

 - 100% of the bonds are insured by insurance companies that guarantee timely
   payments of principal and interest on the bonds (but not Fund units or the
   market value of the bonds before they mature).

   The Portfolio consists of municipal bonds of the following types:

<TABLE>
<CAPTION>
                                                    APPROXIMATE
                                                     PORTFOLIO
                                                    PERCENTAGE
<S>                                                 <C>
/ /Corporate Utility                                       8%
/ /Hospitals/Health Care                                  34%
/ /Municipal Water/Sewer Utilities                        17%
/ /Special Tax Issues                                     23%
/ /Municipal Electric Utilities                           18%
</TABLE>

 4. WHAT ARE THE SIGNIFICANT RISKS?
   YOU CAN LOSE MONEY BY INVESTING IN THE FUND. THIS CAN HAPPEN FOR VARIOUS
   REASONS, INCLUDING:

 - Rising interest rates, an issuer's worsening financial condition or a drop in
   bond ratings can reduce the price of your units.

 - Because the Portfolio is concentrated in hospital/health care bonds, adverse
   developments in this sector may affect the value of your units.

 - Assuming no changes in interest rates, when you sell your units, they will
   generally be worth less than your cost because your cost included a sales
   fee.

 - The Fund will receive early returns of principal if bonds are called or sold
   before they mature. If this happens your income will decline and you may not
   be able to reinvest the money you receive at as high a yield or as long a
   maturity.

   ALSO, THE PORTFOLIO IS CONCENTRATED IN BONDS OF CALIFORNIA SO IT IS LESS
   DIVERSIFIED THAN A NATIONAL FUND AND IS SUBJECT TO RISKS PARTICULAR TO
   CALIFORNIA WHICH ARE BRIEFLY DESCRIBED UNDER STATE CONCENTRATION RISKS LATER
   IN THIS PROSPECTUS.

                                       3
<PAGE>
 5. IS THIS FUND APPROPRIATE FOR YOU?
   Yes, if you want federally tax-free income. You will benefit from a
   professionally selected and supervised portfolio whose risk is reduced by
   investing in insured bonds of several different issuers.

   The Fund is NOT appropriate for you if you want a speculative investment that
   changes to take advantage of market movements, if you do not want a
   tax-advantaged investment or if you cannot tolerate any risk.

                               DEFINING YOUR INCOME

<TABLE>
<S>                                                 <C>
WHAT YOU MAY EXPECT (Payable on the 25th day of
the month to holders of record on the 10th day of
the month):
Regular Monthly Income per unit:                    $4.35
Annual Income per unit:                             $52.25
THESE FIGURES ARE ESTIMATES DETERMINED ON THE EVALUATION
DAY; ACTUAL PAYMENTS MAY VARY.
</TABLE>

 6. WHAT ARE THE FUND'S FEES AND EXPENSES?
   This table shows the costs and expenses you may pay, directly or indirectly,
   when you invest in the Fund.

<TABLE>
<S>                                                 <C>
INVESTOR FEES
Maximum Sales Fee (Load) on new
purchases (as a percentage of
$1,000 invested)                                    2.90%
</TABLE>

   Employees of some of the Sponsors and their affiliates may pay a reduced
   sales fee of no less than $5.00 per unit.

   The maximum sales fee is reduced if you invest at least $100,000, as follows:

<TABLE>
<CAPTION>
                                                    YOUR MAXIMUM
                                                     SALES FEE
                  IF YOU INVEST:                      WILL BE:
                  --------------                    ------------
<S>                                                 <C>
Less than $100,000                                        2.90%
$100,000 to $249,999                                      2.65%
$250,000 to $499,999                                      2.40%
$500,000 to $999,999                                      2.15%
$1,000,000 and over                                       1.90%
Maximum Exchange Fee                                      1.90%
</TABLE>

   ESTIMATED ANNUAL FUND OPERATING EXPENSES

<TABLE>
<CAPTION>
                                                     AMOUNT
                                                    PER UNIT
                                                    --------
<S>                                                 <C>
Trustee's Fee                                        $0.69
Portfolio Supervision,
 Bookkeeping and
 Administrative Fees
 (including updating
 expenses)                                           $0.55
Evaluator's Fee                                      $0.28
Organization Costs                                   $0.20
Other Operating Expenses                             $0.40
                                                     -----
TOTAL                                                $2.12
</TABLE>

   The Sponsors historically paid organization costs and updating expenses.

 7. HOW HAVE SIMILAR FUNDS PERFORMED IN THE PAST?
   In the following chart we show past performance of prior California
   Portfolios, which had investment objectives, strategies and types of bonds
   substantially similar to this Fund. These prior Series differed in that they
   charged a higher sales fee. These prior California Series were offered after
   1987 and were outstanding on December 31, 2000. OF COURSE, PAST PERFORMANCE
   OF PRIOR SERIES IS NO GUARANTEE OF FUTURE RESULTS OF THIS FUND.

   AVERAGE ANNUAL COMPOUND TOTAL RETURNS
                    FOR PRIOR SERIES
    REFLECTING ALL EXPENSES. FOR PERIODS ENDED 12/31/00.

<TABLE>
<CAPTION>
                    WITH SALES FEE                    NO SALES FEE
               1 YEAR     5 YEARS  10 YEARS     1 YEAR     5 YEARS  10 YEARS
<S>         <C>           <C>      <C>       <C>           <C>      <C>
----------------------------------------------------------------------------
High              14.64%   4.86%     5.84%         17.82%   6.04%     6.43%
Average            8.23    4.18      5.71          10.70    5.26      6.30
Low                2.91    2.97      5.60           4.35    3.71      6.19
----------------------------------------------------------------------------
Average
Sales fee          2.28%   5.29%     5.82%
----------------------------------------------------------------------------
</TABLE>

NOTE: ALL RETURNS REPRESENT CHANGES IN UNIT PRICE WITH DISTRIBUTIONS REINVESTED
INTO THE MUNICIPAL FUND INVESTMENT ACCUMULATION PROGRAM.

 8. IS THE FUND MANAGED?
   Unlike a mutual fund, the Fund is not managed and bonds are not sold because
   of market changes. Rather, experienced Defined Asset Funds financial analysts
   regularly review the bonds in the Fund. The Fund may sell a bond if certain
   adverse credit or other conditions exist.

                                       4
<PAGE>
 9. HOW DO I BUY UNITS?
   The minimum investment is one unit.

   You can buy units from any of the Sponsors and other broker-dealers. The
   Sponsors are listed later in this prospectus. Some banks may offer units for
   sale through special arrangements with the Sponsors, although certain legal
   restrictions may apply.

<TABLE>
<S>                                                 <C>
UNIT PRICE PER UNIT                                 $1,016.49
(as of October 31, 2000)
</TABLE>

   Unit price is based on the net asset value of the Fund plus the sales fee. An
   amount equal to any principal cash, as well as net accrued but undistributed
   interest on the unit, is added to the unit price. An independent evaluator
   prices the bonds at 3:30 p.m. Eastern time every business day. Unit price
   changes every day with changes in the prices of the bonds in the Fund.

10. HOW DO I SELL UNITS?
   You may sell your units at any time to any Sponsor or the Trustee for the net
   asset value determined at the close of business on the date of sale. You will
   not pay any other fee when you sell your units.

11. HOW ARE DISTRIBUTIONS MADE AND TAXED?
   The Fund pays income monthly.

   In the opinion of bond counsel when each bond was issued, interest on the
   bonds in this Fund is generally 100% exempt from regular federal income tax.
   Your income may also be exempt from some California state and local personal
   income taxes if you live in California.

   You will also receive principal payments if bonds are sold or called or
   mature, when the cash available is more than $5.00 per unit. You will be
   subject to tax on any gain realized by the Fund on the disposition of bonds.

12. WHAT OTHER SERVICES ARE AVAILABLE?

   REINVESTMENT
   You will receive your income in cash unless you choose to compound your
   income by reinvesting at no sales fee in the Municipal Fund Investment
   Accumulation Program, Inc. This program is an open-end mutual fund with a
   comparable investment objective, but the bonds will generally not be insured.
   Income from this program will generally be subject to state and local income
   taxes. FOR MORE COMPLETE INFORMATION ABOUT THE PROGRAM, INCLUDING CHARGES AND
   FEES, ASK THE TRUSTEE FOR THE PROGRAM'S PROSPECTUS. READ IT CAREFULLY BEFORE
   YOU INVEST. THE TRUSTEE MUST RECEIVE YOUR WRITTEN ELECTION TO REINVEST AT
   LEAST 10 DAYS BEFORE THE RECORD DAY OF AN INCOME PAYMENT.

   EXCHANGE PRIVILEGES
   You may exchange units of this Fund for units of certain other Defined Asset
   Funds. You may also exchange into this Fund from certain other funds. We
   charge a reduced sales fee on exchanges.

                                       5
<PAGE>
--------------------------------------------------------------------------------

NEW JERSEY INSURED PORTFOLIO--RISK/RETURN SUMMARY

 1. WHAT IS THE FUND'S OBJECTIVE?
   The Fund seeks interest income that is exempt from regular federal income
   taxes and some state and local taxes by investing in a fixed portfolio
   consisting primarily of insured, long term municipal revenue bonds.

 2. WHAT ARE MUNICIPAL REVENUE BONDS?
   Municipal revenue bonds are bonds issued by states, municipalities and public
   authorities to finance the cost of buying, building or improving various
   projects intended to generate revenue, such as airports, health care
   facilities, housing and municipal electric, water and sewer utilities.
   Generally, payments on these bonds depend solely on the revenues generated by
   the projects, excise taxes or state appropriations, and are not backed by the
   government's taxing power.

 3. WHAT IS THE FUND'S INVESTMENT STRATEGY?
 - The Fund plans to hold to maturity 7 long-term tax-exempt municipal bonds
   with an aggregate face amount of $2,630,000.

 - The Fund is a unit investment trust which means that, unlike a mutual fund,
   the Portfolio is not managed.

 - The bonds are rated AAA or Aaa by Standard & Poor's, Moody's or Fitch.

 - Many of the bonds can be called at a premium declining over time to par
   value. Some bonds may be called earlier at par for extraordinary reasons.

 - 100% of the bonds are insured by insurance companies that guarantee timely
   payments of principal and interest on the bonds (but not Fund units or the
   market value of the bonds before they mature).

   The Portfolio consists of municipal bonds of the following types:

<TABLE>
<CAPTION>
                                                    APPROXIMATE
                                                     PORTFOLIO
                                                    PERCENTAGE
<S>                                                 <C>
/ /General Obligation                                     23%
/ /Housing                                                19%
/ /Industrial Development Revenue                         16%
/ /Municipal Water/Sewer Utilities                        19%
/ /Refunded Bonds                                          5%
/ /Universities/Colleges                                  18%
</TABLE>

 4. WHAT ARE THE SIGNIFICANT RISKS?
   YOU CAN LOSE MONEY BY INVESTING IN THE FUND. THIS CAN HAPPEN FOR VARIOUS
   REASONS, INCLUDING:

 - Rising interest rates, an issuer's worsening financial condition or a drop in
   bond ratings can reduce the price of your units.

 - Assuming no changes in interest rates, when you sell your units, they will
   generally be worth less than your cost because your cost included a sales
   fee.

 - The Fund will receive early returns of principal if bonds are called or sold
   before they mature. If this happens your income will decline and you may not
   be able to reinvest the money you receive at as high a yield or as long a
   maturity.

   ALSO, THE PORTFOLIO IS CONCENTRATED IN BONDS OF NEW JERSEY SO IT IS LESS
   DIVERSIFIED THAN A NATIONAL FUND AND IS SUBJECT TO RISKS PARTICULAR TO NEW
   JERSEY WHICH ARE BRIEFLY DESCRIBED UNDER STATE CONCENTRATION RISKS LATER IN
   THIS PROSPECTUS.

                                       6
<PAGE>
 5. IS THIS FUND APPROPRIATE FOR YOU?
   Yes, if you want federally tax-free income. You will benefit from a
   professionally selected and supervised portfolio whose risk is reduced by
   investing in insured bonds of several different issuers.

   The Fund is NOT appropriate for you if you want a speculative investment that
   changes to take advantage of market movements, if you do not want a
   tax-advantaged investment or if you cannot tolerate any risk.

                               DEFINING YOUR INCOME

<TABLE>
<S>                                                 <C>
What You May Expect (Payable on the 25th day of
the month to holders of record on the 10th day of
the month):
Regular Monthly Income per unit:                    $4.32
Annual Income per unit:                             $51.84
THESE FIGURES ARE ESTIMATES DETERMINED ON THE EVALUATION
DAY; ACTUAL PAYMENTS MAY VARY.
</TABLE>

 6. WHAT ARE THE FUND'S FEES AND EXPENSES?
   This table shows the costs and expenses you may pay, directly or indirectly,
   when you invest in the Fund.

<TABLE>
<S>                                                 <C>
INVESTOR FEES
Maximum Sales Fee (Load) on new
purchases (as a percentage of
$1,000 invested)                                    2.90%
</TABLE>

   Employees of some of the Sponsors and their affiliates may pay a reduced
   sales fee of no less than $5.00 per unit.

   The maximum sales fee is reduced if you invest at least $100,000, as follows:

<TABLE>
<CAPTION>
                                                    YOUR MAXIMUM
                                                     SALES FEE
                  IF YOU INVEST:                      WILL BE:
                  --------------                    ------------
<S>                                                 <C>
Less than $100,000                                        2.90%
$100,000 to $249,999                                      2.65%
$250,000 to $499,999                                      2.40%
$500,000 to $999,999                                      2.15%
$1,000,000 and over                                       1.90%
Maximum Exchange Fee                                      1.90%
</TABLE>

   ESTIMATED ANNUAL FUND OPERATING EXPENSES

<TABLE>
<CAPTION>
                                                     AMOUNT
                                                    PER UNIT
                                                    --------
<S>                                                 <C>
Trustee's Fee                                        $0.69
Portfolio Supervision,
 Bookkeeping and
 Administrative Fees
 (including updating
 expenses)                                           $0.55
Evaluator's Fee                                      $0.50
Organization Costs                                   $0.20
Other Operating Expenses                             $0.60
                                                     -----
TOTAL                                                $2.54
</TABLE>

   The Sponsors historically paid organization costs and updating expenses.

 7. HOW HAVE SIMILAR FUNDS PERFORMED IN THE PAST?
   IN THE FOLLOWING CHART WE SHOW PAST PERFORMANCE OF PRIOR NEW JERSEY
   PORTFOLIOS, WHICH HAD INVESTMENT OBJECTIVES, STRATEGIES AND TYPES OF BONDS
   SUBSTANTIALLY SIMILAR TO THIS FUND. THESE PRIOR SERIES DIFFERED IN THAT THEY
   CHARGED A HIGHER SALES FEE. These prior New Jersey Series were offered after
   1987 and were outstanding on December 31, 2000. OF COURSE, PAST PERFORMANCE
   OF PRIOR SERIES IS NO GUARANTEE OF FUTURE RESULTS OF THIS FUND.

   AVERAGE ANNUAL COMPOUND TOTAL RETURNS
                    FOR PRIOR SERIES
    REFLECTING ALL EXPENSES. FOR PERIODS ENDED 12/31/00.

<TABLE>
<CAPTION>
                 WITH SALES FEE               NO SALES FEE
            1 YEAR  5 YEARS  10 YEARS  1 YEAR   5 YEARS  10 YEARS
<S>         <C>     <C>      <C>       <C>      <C>      <C>
-----------------------------------------------------------------
High        13.98%   4.46%     5.83%   17.34%    5.63%     6.42%
Average      7.19    3.94      5.73     9.56     5.04      6.32
Low          3.13    2.96      5.48     4.41     3.74      6.07
-----------------------------------------------------------------
Average
Sales fee    2.22%   5.47%     5.82%
-----------------------------------------------------------------
</TABLE>

NOTE: ALL RETURNS REPRESENT CHANGES IN UNIT PRICE WITH DISTRIBUTIONS REINVESTED
INTO THE MUNICIPAL FUND INVESTMENT ACCUMULATION PROGRAM.

 8. IS THE FUND MANAGED?
   Unlike a mutual fund, the Fund is not managed and bonds are not sold because
   of market changes. Rather, experienced Defined Asset Funds financial analysts
   regularly review the bonds in the Fund. The Fund may sell a bond if certain
   adverse credit or other conditions exist.

                                       7
<PAGE>
 9. HOW DO I BUY UNITS?
   The minimum investment is one unit.

   You can buy units from any of the Sponsors and other broker-dealers. The
   Sponsors are listed later in this prospectus. Some banks may offer units for
   sale through special arrangements with the Sponsors, although certain legal
   restrictions may apply.

<TABLE>
<S>                                                 <C>
UNIT PRICE PER UNIT                                 $1,003.93
(as of October 31, 2000)
</TABLE>

   Unit price is based on the net asset value of the Fund plus the sales fee. An
   amount equal to any principal cash, as well as net accrued but undistributed
   interest on the unit, is added to the unit price. An independent evaluator
   prices the bonds at 3:30 p.m. Eastern time every business day. Unit price
   changes every day with changes in the prices of the bonds in the Fund.

10. HOW DO I SELL UNITS?
   You may sell your units at any time to any Sponsor or the Trustee for the net
   asset value determined at the close of business on the date of sale. You will
   not pay any other fee when you sell your units.

11. HOW ARE DISTRIBUTIONS MADE AND TAXED?
   The Fund pays income monthly.

   In the opinion of bond counsel when each bond was issued, interest on the
   bonds in this Fund is generally 100% exempt from regular federal income tax.
   Your income may also be exempt from some New Jersey state and local personal
   income taxes if you live in New Jersey.

   You will also receive principal payments if bonds are sold or called or
   mature, when the cash available is more than $5.00 per unit. You will be
   subject to tax on any gain realized by the Fund on the disposition of bonds.

12. WHAT OTHER SERVICES ARE AVAILABLE?

   REINVESTMENT
   You will receive your income in cash unless you choose to compound your
   income by reinvesting at no sales fee in the Municipal Fund Investment
   Accumulation Program, Inc. This program is an open-end mutual fund with a
   comparable investment objective, but the bonds generally will not be insured.
   Income from this program will generally be subject to state and local income
   taxes. FOR MORE COMPLETE INFORMATION ABOUT THE PROGRAM, INCLUDING CHARGES AND
   FEES, ASK THE TRUSTEE FOR THE PROGRAM'S PROSPECTUS. READ IT CAREFULLY BEFORE
   YOU INVEST. THE TRUSTEE MUST RECEIVE YOUR WRITTEN ELECTION TO REINVEST AT
   LEAST 10 DAYS BEFORE THE RECORD DAY OF AN INCOME PAYMENT.

   EXCHANGE PRIVILEGES
   You may exchange units of this Fund for units of certain other Defined Asset
   Funds. You may also exchange into this Fund from certain other funds. We
   charge a reduced sales fee on exchanges.

                                       8
<PAGE>
--------------------------------------------------------------------------------

NEW YORK INSURED PORTFOLIO--RISK/RETURN SUMMARY

 1. WHAT IS THE FUND'S OBJECTIVE?
   The Fund seeks interest income that is exempt from regular federal income
   taxes and some state and local taxes by investing in a fixed portfolio
   consisting primarily of insured, long term municipal revenue bonds.

 2. WHAT ARE MUNICIPAL REVENUE BONDS?
   Municipal revenue bonds are bonds issued by states, municipalities and public
   authorities to finance the cost of buying, building or improving various
   projects intended to generate revenue, such as airports, health care
   facilities, housing and municipal electric, water and sewer utilities.
   Generally, payments on these bonds depend solely on the revenues generated by
   the projects, excise taxes or state appropriations, and are not backed by the
   government's taxing power.

 3. WHAT IS THE FUND'S INVESTMENT STRATEGY?
 - The Fund plans to hold to maturity 7 long-term tax-exempt municipal bonds
   with an aggregate face amount of $2,825,000.

 - The Fund is a unit investment trust which means that, unlike a mutual fund,
   the Portfolio is not managed.

 - The bonds are rated AAA or Aaa by Standard & Poor's, Moody's or Fitch.

 - Many of the bonds can be called at a premium declining over time to par
   value. Some bonds may be called earlier at par for extraordinary reasons.

 - 100% of the bonds are insured by insurance companies that guarantee timely
   payments of principal and interest on the bonds (but not Fund units or the
   market value of the bonds before they mature).

   The Portfolio consists of municipal bonds of the following types:

<TABLE>
<CAPTION>
                                                    APPROXIMATE
                                                     PORTFOLIO
                                                    PERCENTAGE
<S>                                                 <C>
/ /Hospitals/Health Care                                  19%
/ /Lease Rental                                           33%
/ /Municipal Water/Sewer Utilities                         6%
/ /Universities/Colleges                                  42%
</TABLE>

 4. WHAT ARE THE SIGNIFICANT RISKS?
   YOU CAN LOSE MONEY BY INVESTING IN THE FUND. THIS CAN HAPPEN FOR VARIOUS
   REASONS, INCLUDING:

 - Rising interest rates, an issuer's worsening financial condition or a drop in
   bond ratings can reduce the price of your units.

 - Because the Portfolio is concentrated in lease rental and university/college
   bonds, adverse developments in these sectors may affect the value of your
   units.

 - Assuming no changes in interest rates, when you sell your units, they will
   generally be worth less than your cost because your cost included a sales
   fee.

 - The Fund will receive early returns of principal if bonds are called or sold
   before they mature. If this happens your income will decline and you may not
   be able to reinvest the money you receive at as high a yield or as long a
   maturity.

   ALSO, THE PORTFOLIO IS CONCENTRATED IN BONDS OF NEW YORK SO IT IS LESS
   DIVERSIFIED THAN A NATIONAL FUND AND IS SUBJECT TO RISKS PARTICULAR TO NEW
   YORK WHICH ARE BRIEFLY DESCRIBED UNDER STATE CONCENTRATION RISKS LATER IN
   THIS PROSPECTUS.

                                       9
<PAGE>
 5. IS THIS FUND APPROPRIATE FOR YOU?
   Yes, if you want federally tax-free income. You will benefit from a
   professionally selected and supervised portfolio whose risk is reduced by
   investing in insured bonds of several different issuers.

   The Fund is NOT appropriate for you if you want a speculative investment that
   changes to take advantage of market movements, if you do not want a
   tax-advantaged investment or if you cannot tolerate any risk.

                               DEFINING YOUR INCOME

<TABLE>
<S>                                                 <C>
What You May Expect (Payable on the 25th day of
the month to holders of record on the 10th day of
the month):
Regular Monthly Income per unit:                    $4.25
Annual Income per unit:                             $51.11
THESE FIGURES ARE ESTIMATES DETERMINED ON THE EVALUATION
DAY; ACTUAL PAYMENTS MAY VARY.
</TABLE>

 6. WHAT ARE THE FUND'S FEES AND EXPENSES?
   This table shows the costs and expenses you may pay, directly or indirectly,
   when you invest in the Fund.

<TABLE>
<S>                                                 <C>
INVESTOR FEES
Maximum Sales Fee (Load) on new
purchases (as a percentage of
$1,000 invested)                                    2.90%
</TABLE>

   Employees of some of the Sponsors and their affiliates may pay a reduced
   sales fee of no less than $5.00 per unit.

   The maximum sales fee is reduced if you invest at least $100,000, as follows:

<TABLE>
<CAPTION>
                                                    YOUR MAXIMUM
                                                     SALES FEE
                  IF YOU INVEST:                      WILL BE:
                  --------------                    ------------
<S>                                                 <C>
Less than $100,000                                        2.90%
$100,000 to $249,999                                      2.65%
$250,000 to $499,999                                      2.40%
$500,000 to $999,999                                      2.15%
$1,000,000 and over                                       1.90%
Maximum Exchange Fee                                      1.90%
</TABLE>

   ESTIMATED ANNUAL FUND OPERATING EXPENSES

<TABLE>
<CAPTION>
                                                     AMOUNT
                                                    PER UNIT
                                                    --------
<S>                                                 <C>
Trustee's Fee                                        $0.69
Portfolio Supervision,
 Bookkeeping and
 Administrative Fees
 (including updating
 expenses)                                           $0.55
Evaluator's Fee                                      $0.45
Organization Costs                                   $0.20
Other Operating Expenses                             $0.66
                                                     -----
TOTAL                                                $2.55
</TABLE>

   The Sponsors historically paid organization costs and updating expenses.

 7. HOW HAVE SIMILAR FUNDS PERFORMED IN THE PAST?
   In the following chart we show past performance of prior New York Portfolios,
   which had investment objectives, strategies and types of bonds substantially
   similar to this Fund. These prior Series differed in that they charged a
   higher sales fee. These prior New York Series were offered after 1987 and
   were outstanding on December 31, 2000. OF COURSE, PAST PERFORMANCE OF PRIOR
   SERIES IS NO GUARANTEE OF FUTURE RESULTS OF THIS FUND.

   AVERAGE ANNUAL COMPOUND TOTAL RETURNS
                    FOR PRIOR SERIES
    REFLECTING ALL EXPENSES. FOR PERIODS ENDED 12/31/00.

<TABLE>
<CAPTION>
                 WITH SALES FEE               NO SALES FEE
            1 YEAR  5 YEARS  10 YEARS  1 YEAR   5 YEARS  10 YEARS
<S>         <C>     <C>      <C>       <C>      <C>      <C>
-----------------------------------------------------------------
High        17.51%   4.77%     6.86%   20.89%    5.74%     7.46%
Average      9.10    4.03      6.17    11.38     5.05      6.75
Low          3.73    3.05      5.79     5.09     3.82      6.38
-----------------------------------------------------------------
Average
Sales fee    2.02%   4.98%     5.78%
-----------------------------------------------------------------
</TABLE>

NOTE: ALL RETURNS REPRESENT CHANGES IN UNIT PRICE WITH DISTRIBUTIONS REINVESTED
INTO THE MUNICIPAL FUND INVESTMENT ACCUMULATION PROGRAM.

 8. IS THE FUND MANAGED?
   Unlike a mutual fund, the Fund is not managed and bonds are not sold because
   of market changes. Rather, experienced Defined Asset Funds financial analysts
   regularly review the bonds in the Fund. The Fund may sell a bond if certain
   adverse credit or other conditions exist.

                                       10
<PAGE>
 9. HOW DO I BUY UNITS?
   The minimum investment is one unit.

   You can buy units from any of the Sponsors and other broker-dealers. The
   Sponsors are listed later in this prospectus. Some banks may offer units for
   sale through special arrangements with the Sponsors, although certain legal
   restrictions may apply.

<TABLE>
<S>                                                 <C>
UNIT PRICE PER UNIT                                 $999.83
(as of October 31, 2000)
</TABLE>

   Unit price is based on the net asset value of the Fund plus the sales fee. An
   amount equal to any principal cash, as well as net accrued but undistributed
   interest on the unit, is added to the unit price. An independent evaluator
   prices the bonds at 3:30 p.m. Eastern time every business day. Unit price
   changes every day with changes in the prices of the bonds in the Fund.

10. HOW DO I SELL UNITS?
   You may sell your units at any time to any Sponsor or the Trustee for the net
   asset value determined at the close of business on the date of sale. You will
   not pay any other fee when you sell your units.

11. HOW ARE DISTRIBUTIONS MADE AND TAXED?
   The Fund pays income monthly.

   In the opinion of bond counsel when each bond was issued, interest on the
   bonds in this Fund is generally 100% exempt from regular federal income tax.
   Your income may also be exempt from some New York state and local personal
   income taxes if you live in New York.

   You will also receive principal payments if bonds are sold or called or
   mature, when the cash available is more than $5.00 per unit. You will be
   subject to tax on any gain realized by the Fund on the disposition of bonds.

12. WHAT OTHER SERVICES ARE AVAILABLE?

   REINVESTMENT
   You will receive your income in cash unless you choose to compound your
   income by reinvesting at no sales fee in the Municipal Fund Investment
   Accumulation Program, Inc. This program is an open-end mutual fund with a
   comparable investment objective, but the bonds generally will not be insured.
   Income from this program will generally be subject to state and local income
   taxes. FOR MORE COMPLETE INFORMATION ABOUT THE PROGRAM, INCLUDING CHARGES AND
   FEES, ASK THE TRUSTEE FOR THE PROGRAM'S PROSPECTUS. READ IT CAREFULLY BEFORE
   YOU INVEST. THE TRUSTEE MUST RECEIVE YOUR WRITTEN ELECTION TO REINVEST AT
   LEAST 10 DAYS BEFORE THE RECORD DAY OF AN INCOME PAYMENT.

   EXCHANGE PRIVILEGES
   You may exchange units of this Fund for units of certain other Defined Asset
   Funds. You may also exchange into this Fund from certain other funds. We
   charge a reduced sales fee on exchanges.

                                       11
<PAGE>
--------------------------------------------------------------------------------

PENNSYLVANIA INSURED PORTFOLIO--RISK/RETURN SUMMARY

 1. WHAT IS THE FUND'S OBJECTIVE?
   The Fund seeks interest income that is exempt from regular federal income
   taxes and some state and local taxes by investing in a fixed portfolio
   consisting primarily of insured, long term municipal revenue bonds.

 2. WHAT ARE MUNICIPAL REVENUE BONDS?
   Municipal revenue bonds are bonds issued by states, municipalities and public
   authorities to finance the cost of buying, building or improving various
   projects intended to generate revenue, such as airports, health care
   facilities, housing and municipal electric, water and sewer utilities.
   Generally, payments on these bonds depend solely on the revenues generated by
   the projects, excise taxes or state appropriations, and are not backed by the
   government's taxing power.

 3. WHAT IS THE FUND'S INVESTMENT STRATEGY?
 - The Fund plans to hold to maturity 7 long-term tax-exempt municipal bonds
   with an aggregate face amount of $2,200,000.

 - The Fund is a unit investment trust which means that, unlike a mutual fund,
   the Portfolio is not managed.

 - The bonds are rated AAA or Aaa by Standard & Poor's, Moody's or Fitch.

 - Many of the bonds can be called at a premium declining over time to par
   value. Some bonds may be called earlier at par for extraordinary reasons.

 - 100% of the bonds are insured by insurance companies that guarantee timely
   payments of principal and interest on the bonds (but not Fund units or the
   market value of the bonds before they mature).

   The Portfolio consists of municipal bonds of the following types:

<TABLE>
<CAPTION>
                                                    APPROXIMATE
                                                     PORTFOLIO
                                                    PERCENTAGE
<S>                                                 <C>
/ /General Obligation                                     26%
/ /Housing                                                22%
/ /Municipal Water/Sewer Utilities                         1%
/ /Refunded Bonds                                         11%
/ /Parking, Stadums/Recreational Facilities               17%
/ /Universities/Colleges                                  23%
</TABLE>

 4. WHAT ARE THE SIGNIFICANT RISKS?
   YOU CAN LOSE MONEY BY INVESTING IN THE FUND. THIS CAN HAPPEN FOR VARIOUS
   REASONS, INCLUDING:

 - Rising interest rates, an issuer's worsening financial condition or a drop in
   bond ratings can reduce the price of your units.

 - Because the Portfolio is concentrated in general obligation bonds, adverse
   developments in this sector may affect the value of your units.

 - Assuming no changes in interest rates, when you sell your units, they will
   generally be worth less than your cost because your cost included a sales
   fee.

 - The Fund will receive early returns of principal if bonds are called or sold
   before they mature. If this happens your income will decline and you may not
   be able to reinvest the money you receive at as high a yield or as long a
   maturity.

   ALSO, THE PORTFOLIO IS CONCENTRATED IN BONDS OF PENNSYLVANIA SO IT IS LESS
   DIVERSIFIED THAN A NATIONAL FUND AND IS SUBJECT TO RISKS PARTICULAR TO
   PENNSYLVANIA WHICH ARE BRIEFLY DESCRIBED UNDER STATE CONCENTRATION RISKS
   LATER IN THIS PROSPECTUS.

                                       12
<PAGE>
 5. IS THIS FUND APPROPRIATE FOR YOU?
   Yes, if you want federally tax-free income. You will benefit from a
   professionally selected and supervised portfolio whose risk is reduced by
   investing in insured bonds of several different issuers.

   The Fund is NOT appropriate for you if you want a speculative investment that
   changes to take advantage of market movements, if you do not want a
   tax-advantaged investment or if you cannot tolerate any risk.

                               DEFINING YOUR INCOME

<TABLE>
<S>                                                 <C>
What You May Expect (Payable on the 25th day of
the month to holders of record on the 10th day of
the month):
Regular Monthly Income per unit:                    $4.37
Annual Income per unit:                             $52.49
THESE FIGURES ARE ESTIMATES DETERMINED ON THE EVALUATION
DAY; ACTUAL PAYMENTS MAY VARY.
</TABLE>

 6. WHAT ARE THE FUND'S FEES AND EXPENSES?
   This table shows the costs and expenses you may pay, directly or indirectly,
   when you invest in the Fund.

<TABLE>
<S>                                                 <C>
INVESTOR FEES
Maximum Sales Fee (Load) on new
purchases (as a percentage of
$1,000 invested)                                    2.90%
</TABLE>

   Employees of some of the Sponsors and their affiliates may pay a reduced
   sales fee of no less than $5.00 per unit.

   The maximum sales fee is reduced if you invest at least $100,000, as follows:

<TABLE>
<CAPTION>
                                                    YOUR MAXIMUM
                                                     SALES FEE
                  IF YOU INVEST:                      WILL BE:
                  --------------                    ------------
<S>                                                 <C>
Less than $100,000                                        2.90%
$100,000 to $249,999                                      2.65%
$250,000 to $499,999                                      2.40%
$500,000 to $999,999                                      2.15%
$1,000,000 and over                                       1.90%
Maximum Exchange Fee                                      1.90%
</TABLE>

   ESTIMATED ANNUAL FUND OPERATING EXPENSES

<TABLE>
<CAPTION>
                                                     AMOUNT
                                                    PER UNIT
                                                    --------
<S>                                                 <C>
Trustee's Fee                                        $0.69
Portfolio Supervision,
 Bookkeeping and
 Administrative Fees
 (including updating
 expenses)                                           $0.54
Evaluator's Fee                                      $0.51
Organization Costs                                   $0.20
Other Operating Expenses                             $0.87
                                                     -----
TOTAL                                                $2.81
</TABLE>

   The Sponsors historically paid organization costs and updating expenses.

 7. HOW HAVE SIMILAR FUNDS PERFORMED IN THE PAST?
   IN THE FOLLOWING CHART WE SHOW PAST PERFORMANCE OF PRIOR PENNSYLVANIA
   PORTFOLIOS, WHICH HAD INVESTMENT OBJECTIVES, STRATEGIES AND TYPES OF BONDS
   SUBSTANTIALLY SIMILAR TO THIS FUND. THESE PRIOR SERIES DIFFERED IN THAT THEY
   CHARGED A HIGHER SALES FEE. These prior Pennsylvania Series were offered
   after 1987 and were outstanding on December 31, 2000. OF COURSE, PAST
   PERFORMANCE OF PRIOR SERIES IS NO GUARANTEE OF FUTURE RESULTS OF THIS FUND.

   AVERAGE ANNUAL COMPOUND TOTAL RETURNS
                    FOR PRIOR SERIES
    REFLECTING ALL EXPENSES. FOR PERIODS ENDED 12/31/00.

<TABLE>
<CAPTION>
                 WITH SALES FEE               NO SALES FEE
            1 YEAR  5 YEARS  10 YEARS  1 YEAR   5 YEARS  10 YEARS
<S>         <C>     <C>      <C>       <C>      <C>      <C>
-----------------------------------------------------------------
High        15.78%   4.68%     6.18%   19.13%    5.73%     6.78%
Average      8.08    4.00      5.95    10.44     5.06      6.54
Low          2.98    3.01      5.74     4.52     3.96      6.33
-----------------------------------------------------------------
Average
Sales fee    2.12%   5.19%     5.82%
-----------------------------------------------------------------
</TABLE>

NOTE: ALL RETURNS REPRESENT CHANGES IN UNIT PRICE WITH DISTRIBUTIONS REINVESTED
INTO THE MUNICIPAL FUND INVESTMENT ACCUMULATION PROGRAM.

 8. IS THE FUND MANAGED?
   Unlike a mutual fund, the Fund is not managed and bonds are not sold because
   of market changes. Rather, experienced Defined Asset Funds financial analysts
   regularly review the bonds in the Fund. The Fund may sell a bond if certain
   adverse credit or other conditions exist.

                                       13
<PAGE>
 9. HOW DO I BUY UNITS?
   The minimum investment is one unit.

   You can buy units from any of the Sponsors and other broker-dealers. The
   Sponsors are listed later in this prospectus. Some banks may offer units for
   sale through special arrangements with the Sponsors, although certain legal
   restrictions may apply.

<TABLE>
<S>                                                 <C>
UNIT PRICE PER UNIT                                 $1,010.55
(as of October 31, 2000)
</TABLE>

   Unit price is based on the net asset value of the Fund plus the sales fee. An
   amount equal to any principal cash, as well as net accrued but undistributed
   interest on the unit, is added to the unit price. An independent evaluator
   prices the bonds at 3:30 p.m. Eastern time every business day. Unit price
   changes every day with changes in the prices of the bonds in the Fund.

10. HOW DO I SELL UNITS?
   You may sell your units at any time to any Sponsor or the Trustee for the net
   asset value determined at the close of business on the date of sale. You will
   not pay any other fee when you sell your units.

11. HOW ARE DISTRIBUTIONS MADE AND TAXED?
   The Fund pays income monthly.

   In the opinion of bond counsel when each bond was issued, interest on the
   bonds in this Fund is generally 100% exempt from regular federal income tax.
   Your income may also be exempt from some Pennsylvania state and local
   personal income taxes if you live in Pennsylvania.

   You will also receive principal payments if bonds are sold or called or
   mature, when the cash available is more than $5.00 per unit. You will be
   subject to tax on any gain realized by the Fund on the disposition of bonds.

12. WHAT OTHER SERVICES ARE AVAILABLE?

   REINVESTMENT
   You will receive your income in cash unless you choose to compound your
   income by reinvesting at no sales fee in the Municipal Fund Investment
   Accumulation Program, Inc. This program is an open-end mutual fund with a
   comparable investment objective, but the bonds will generally not be insured.
   Income from this program will generally be subject to state and local income
   taxes. FOR MORE COMPLETE INFORMATION ABOUT THE PROGRAM, INCLUDING CHARGES AND
   FEES, ASK THE TRUSTEE FOR THE PROGRAM'S PROSPECTUS. READ IT CAREFULLY BEFORE
   YOU INVEST. THE TRUSTEE MUST RECEIVE YOUR WRITTEN ELECTION TO REINVEST AT
   LEAST 10 DAYS BEFORE THE RECORD DAY OF AN INCOME PAYMENT.

   EXCHANGE PRIVILEGES
   You may exchange units of this Fund for units of certain other Defined Asset
   Funds. You may also exchange into this Fund from certain other funds. We
   charge a reduced sales fee on exchanges.

                                       14
<PAGE>
--------------------------------------------------------------------------------
    TAX-FREE VS. TAXABLE INCOME: A COMPARISON OF TAXABLE AND TAX-FREE YIELDS

                            FOR CALIFORNIA RESIDENTS
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                    COMBINED
                                    EFFECTIVE
       TAXABLE INCOME 2001*         TAX RATE                            TAX-FREE YIELD OF
SINGLE RETURN       JOINT RETURN        %       3%    3.5%    4%     4.5%     5%     5.5%     6%     6.5%     7%     7.5%     8%
                                                               IS EQUIVALENT TO A TAXABLE YIELD OF
----------------------------------------------------------------------------------------------------------------------------------
<S>               <C>               <C>        <C>    <C>    <C>    <C>     <C>     <C>     <C>     <C>     <C>     <C>     <C>
$      0- 26,250  $      0- 43,050     20.10   3.75   4.38   5.01    5.63    6.26    6.88    7.51    8.14    8.76    9.39   10.01
$ 26,251- 63,550  $ 43,851-105,950     34.70   4.59   5.36   6.13    6.89    7.66    8.42    9.19    9.95   10.72   11.48   12.25
$ 63,551-132,600  $105,951-161,450     37.42   4.79   5.59   6.39    7.19    7.99    8.79    9.59   10.39   11.19   11.98   12.78
$132,601-288,350  $161,451-288,350     41.95   5.17   6.03   6.89    7.75    8.61    9.47   10.34   11.20   12.06   12.92   13.78
   OVER $288,350     OVER $288,350     45.22   5.48   6.39   7.30    8.21    9.13   10.04   10.95   11.87   12.78   13.69   14.60
</TABLE>

                            FOR NEW JERSEY RESIDENTS
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                    COMBINED
                                    EFFECTIVE
       TAXABLE INCOME 2001*         TAX RATE                            TAX-FREE YIELD OF
SINGLE RETURN       JOINT RETURN        %       4%    4.5%    5%     5.5%     6%     6.5%     7%     7.5%     8%
                                                               IS EQUIVALENT TO A TAXABLE YIELD OF
------------------------------------------------------------------------------------------------------------------
<S>               <C>               <C>        <C>    <C>    <C>    <C>     <C>     <C>     <C>     <C>     <C>
$      0- 26,250  $      0- 43,850     16.49   4.79   5.39   5.99    6.59    7.18    7.78    8.38    8.98    9.58
$ 26,251- 63,550  $ 43,851-105,950     31.98   5.88   6.62   7.35    8.09    8.82    9.56   10.29   11.03   11.76
$ 63,551-132,600  $105,951-161,450     35.40   6.19   6.97   7.74    8.51    9.29   10.06   10.84   11.61   12.38
$132,601-288,350  $161,451-288,350     40.08   6.68   7.51   8.34    9.18   10.01   10.85   11.68   12.52   13.35
   OVER $288,350     OVER $288,350     43.45   7.07   7.96   8.84    9.73   10.61   11.49   12.38   13.26   14.15
</TABLE>

                          FOR NEW YORK CITY RESIDENTS
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                    COMBINED
                                    EFFECTIVE
       TAXABLE INCOME 2001*         TAX RATE
SINGLE RETURN       JOINT RETURN        %       4%    4.5%    5%     5.5%     6%     6.5%     7%     7.5%     8%
                                                               IS EQUIVALENT TO A TAXABLE YIELD OF
------------------------------------------------------------------------------------------------------------------
<S>               <C>               <C>        <C>    <C>    <C>    <C>     <C>     <C>     <C>     <C>     <C>
$      0- 26,250  $      0- 43,850     23.94   5.26   5.92   6.57    7.23    7.89    8.55    9.20    9.86   10.52
$ 26,251- 63,550  $ 43,851-105,950     23.99   5.26   5.92   6.58    7.24    7.89    8.55    9.21    9.87   10.52
$ 26,251- 63,550  $ 43,851-105,950     35.65   6.22   6.99   7.77    8.55    9.32   10.10   10.88   11.66   12.43
$ 63,551-132,600  $105,951-161,450     38.33   6.49   7.30   8.11    8.92    9.73   10.54   11.35   12.16   12.97
$132,601-288,350  $161,451-288,350     42.80   6.99   7.87   8.74    9.62   10.49   11.36   12.24   13.11   13.99
   OVER $288,350     OVER $288,350     46.02   7.41   8.34   9.26   10.19   11.12   12.04   12.97   13.89   14.82
</TABLE>

                          FOR NEW YORK STATE RESIDENTS
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                    COMBINED
                                    EFFECTIVE
       TAXABLE INCOME 2001*         TAX RATE
SINGLE RETURN       JOINT RETURN        %       4%    4.5%    5%     5.5%     6%     6.5%     7%     7.5%     8%
                                                               IS EQUIVALENT TO A TAXABLE YIELD OF
------------------------------------------------------------------------------------------------------------------
<S>               <C>               <C>        <C>    <C>    <C>    <C>     <C>     <C>     <C>     <C>     <C>
$      0- 26,250  $      0- 43,850     20.82   5.05   5.68   6.31    6.95    7.58    8.21    8.84    9.47   10.10
$ 26,251- 63,550  $ 43,851-105,950     32.93   5.96   6.71   7.46    8.20    8.95    9.69   10.44   11.18   11.93
$ 63,551-132,600  $105,951-161,450     35.73   6.22   7.00   7.78    8.56    9.34   10.11   10.89   11.67   12.45
$132,601-288,350  $161,451-288,350     40.38   6.71   7.55   8.39    9.23   10.06   10.90   11.74   12.58   13.42
   OVER $288,350     OVER $288,350     43.74   7.11   8.00   8.89    9.78   10.66   11.55   12.44   13.33   14.22
</TABLE>

                           FOR PENNSYLVANIA RESIDENTS
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                    COMBINED
                                    EFFECTIVE
       TAXABLE INCOME 2001*         TAX RATE
SINGLE RETURN       JOINT RETURN        %       3%    3.5%    4%     4.5%     5%     5.5%     6%     6.5%     7%     7.5%     8%
                                                                       IS EQUIVALENT TO A TAXABLE YIELD OF
----------------------------------------------------------------------------------------------------------------------------------
<S>               <C>               <C>        <C>    <C>    <C>    <C>     <C>     <C>     <C>     <C>     <C>     <C>     <C>
$      0- 26,250  $      0- 43,850     17.38   3.63   4.24   4.84    5.45    6.05    6.66    7.26    7.87    8.47    9.08    9.68
$ 26,251- 63,550  $ 43,851-109,950     30.02   4.29   5.00   5.72    6.43    7.14    7.86    8.57    9.29   10.00   10.72   11.43
$ 63,551-132,600  $105,951-161,450     32.93   4.47   5.22   5.96    6.71    7.46    8.20    8.95    9.69   10.44   11.18   11.93
$132,601-288,350  $161,451-288,350     37.79   4.82   5.63   6.43    7.23    8.04    8.84    9.65   10.45   11.25   12.06   12.86
   OVER $288,350     OVER $288,350     41.29   5.11   5.96   6.81    7.66    8.52    9.37   10.22   11.07   11.92   12.77   13.63
</TABLE>

To compare the yield of a taxable security with the yield of a tax-free
security, find your taxable income and read across. The table incorporates 2000
federal and applicable State (and City) income tax rates and assumes that all
income would otherwise be taxed at the investor's highest tax rate. Yield
figures are for example only.

*Based upon net amount subject to federal income tax after deductions and
exemptions. This table does not reflect the possible effect of other tax
factors, such as alternative minimum tax, personal exemptions, the phase out of
exemptions, itemized deductions or the possible partial disallowance of
deductions. Consequently, investors are urged to consult their own tax advisers
in this regard.

                                       15
<PAGE>
WHAT YOU CAN EXPECT FROM YOUR INVESTMENT

MONTHLY INCOME

The Fund will pay you regular monthly income. Your monthly income may vary
because of:

  - elimination of one or more bonds from the Fund's portfolio because of calls,
    redemptions or sales;
  - a change in the Fund's expenses; or
  - the failure by a bond's issuer to pay interest.

Changes in interest rates generally will not affect your income because the
portfolio is fixed.

Along with your income, you will receive your share of any available bond
principal.

RETURN FIGURES

We cannot predict your actual return, which will vary with unit price, how long
you hold your investment and changes in the portfolio, interest income and
expenses.

ESTIMATED CURRENT RETURN equals the estimated annual cash to be received from
the bonds in the Fund less estimated annual Fund expenses, divided by the Unit
Price (including the maximum sales fee):

<TABLE>
<S>               <C><C>
Estimated Annual  -     Estimated
Interest Income      Annual Expenses
------------------------------------
             Unit Price
</TABLE>

ESTIMATED LONG TERM RETURN is a measure of the estimated return over the
estimated life of the Fund. Unlike Estimated Current Return, Estimated Long Term
Return reflects maturities, discounts and premiums of the bonds in the Fund. It
is an average of the yields to maturity (or in certain cases, to an earlier call
date) of the individual bonds in the portfolio, adjusted to reflect the Fund's
maximum sales fee and estimated expenses. We calculate the average yield for the
portfolio by weighting each bond's yield by its market value and the time
remaining to the call or maturity date.

Yields on individual bonds depend on many factors including general conditions
of the bond markets, the size of a particular offering and the maturity and
quality rating of the particular issues. Yields can vary among bonds with
similar maturities, coupons and ratings.

These return quotations are designed to be comparative rather than predictive.

RECORDS AND REPORTS

You will receive:

- a monthly statement of income payments and any principal payments;
- a notice from the Trustee when new bonds are deposited in exchange or
  substitution for bonds originally deposited;
- an annual report on Fund activity; and
- annual tax information. THIS WILL ALSO BE SENT TO THE IRS. YOU MUST REPORT THE
  AMOUNT OF TAX-EXEMPT INTEREST RECEIVED DURING THE YEAR.

You may request:

- copies of bond evaluations to enable you to comply with federal and state tax
  reporting requirements; and
- audited financial statements of the Fund.

You may inspect records of Fund transactions at the Trustee's office during
regular business hours.

                                       16
<PAGE>
THE RISKS YOU FACE

INTEREST RATE RISK

Investing involves risks, including the risk that your investment will decline
in value if interest rates rise. Generally, bonds with longer maturities will
change in value more than bonds with shorter maturities. Bonds in the Fund are
more likely to be called when interest rates decline. This would result in early
returns of principal to you and may result in early termination of the Fund. Of
course, we cannot predict how interest rates may change.

CALL RISK

Many bonds can be prepaid or "called" by the issuer before their stated
maturity.

For example, some bonds may be required to be called pursuant to mandatory
sinking fund provisions.

Also, an issuer might call its bonds during periods of falling interest rates,
if the issuer's bonds have a coupon higher than current market rates.

An issuer might call its bonds in extraordinary cases, including if:

  - it no longer needs the money for the original purpose;
  - the project is condemned or sold;
  - the project is destroyed and insurance proceeds are used to redeem the
    bonds;
  - any related credit support expires and is not replaced; or
  - interest on the bonds become taxable.

If the bonds are called, your income will decline and you may not be able to
reinvest the money you receive at as high a yield or as long a maturity. An
early call at par of a premium bond will reduce your return.

REDUCED DIVERSIFICATION RISK

If many investors sell their units, the Fund will have to sell bonds. This could
reduce the diversification of your investment and increase your share of Fund
expenses.

LIQUIDITY RISK

You can always sell back your units, but we cannot assure you that a liquid
trading market will always exist for the bonds in the portfolio, especially
since current law may restrict the Fund from selling bonds to any Sponsor. The
bonds will generally trade in the over-the-counter market. The value of the
bonds, and of your investment, may be reduced if trading in bonds is limited or
absent.

CONCENTRATION RISK

When a certain type of bond makes up 25% or more of the portfolio, it is said to
be "concentrated" in that bond type, which makes the Portfolio less diversified.

Here is what you should know about California Portfolio's concentration in
hospital and health care bonds.

  - payment for these bonds depends on revenues from private third-party payors
    and government programs, including Medicare and Medicaid, which have
    generally undertaken cost containment measures to limit payments to health
    care providers;
  - hospitals face increasing competition resulting from hospital mergers and
    affiliations;
  - hospitals need to reduce costs as HMOs increase market penetration and
    hospital supply and drug companies raise prices;

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<PAGE>
  - hospitals and health care providers are subject to various legal claims by
    patients and others and are adversely affected by increasing costs of
    insurance; and
  - many hospitals are aggressively buying physician practices and assuming risk
    contracts to gain market share. If revenues do not increase accordingly,
    this practice could reduce profits;
  - Medicare is changing its reimbursement system for nursing homes. Many
    nursing home providers are not sure how they will be treated. In many cases,
    the providers may receive lower reimbursements and these would have to cut
    expenses to maintain profitability; and
  - most retirement/nursing home providers rely on entrance fees for operating
    revenues. If people live longer than expected and turnover is lower than
    budgeted, operating revenues would be adversely affected by less than
    expected entrance fees.

Here is what you should know about Pennsylvania Portfolio's concentration in
general obligation bonds.

  - general obligation bonds are backed by the issuer's pledge of its full
    faith, credit and taxing power;
  - but the taxing power of any government issuer may be limited by provisions
    of the state constitution or laws as well as political considerations; and
  - an issuer's credit can be negatively affected by various factors, including
    population decline that erodes the tax base, natural disasters, decline in
    industry, limited access to capital markets or heavy reliance on state or
    federal aid.

Here is what you should know about New York Portfolio's concentration in
university/ college bonds. Payment for these bonds depends on:

  - level or amount and diversity of sources of revenue;
  - availability of endowments and other funds;
  - enrollment;
  - financial management;
  - reputation; and
  - for public institutions, the financial condition of the government and its
    educational policies.

Here is what you should know about New York Portfolio's concentration in lease
rental bonds. Lease rental bonds are generally issued by governmental financing
authorities that cannot assess a tax to cover the cost of equipment or
construction of buildings that will be used by a state or local government. The
risks associated with these bonds include:

  - the failure of the government to appropriate funds for the leasing rental
    payments to service the bonds; and
  - rental obligations, and therefore payments, may terminate in the event of
    damages to or destruction or condemnation of the of the equipment or
    building.

Changes to the portfolio from bond redemptions, maturities and sales may affect
the Fund's concentrations over time.

STATE CONCENTRATION RISK

CALIFORNIA RISKS

GENERALLY

From the late 1980s through the early 1990s, an economic recession eroded
California's

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revenue base. At the same time rapid population growth caused State expenditures
to exceed budget appropriations.

  - As a result California experienced a period of sustained budget imbalance.
  - Since that time the California economy has improved markedly and the extreme
    budgetary pressures have begun to lessen.

STATE GOVERNMENT

The 1999-2000 Budget Act allocated a State budget of approximately $63.7 Billion
and contains no tax increases or reductions. Despite this somewhat improved
state, California's budget is still subject to certain unforeseeable events. For
example:

  - In December, 1994, Orange County and its investment pool filed for
    bankruptcy. While a settlement has been reached, the full impact on the
    State and Orange County remains unknown.
  - California faces constant fluctuations in other expenses (including health
    and welfare caseloads, property tax receipts, federal funding and natural
    disaster relief) that will undoubtedly create new budgetary pressure and
    reduce ability to pay their debts.
  - California's general obligation bonds are currently rated AA3 by Moody's and
    AA- by Standard & Poor's.

OTHER RISKS

Issuers' ability to make payments on bonds (and the remedies available to
bondholders) could also be adversely affected by the following constraints:

  - Certain provisions of California's Constitution, laws and regulatory system
    contain tax, spending and appropriations limits and prohibit certain new
    taxes.
  - Certain other California laws subject the users of bond proceeds to strict
    rules and limits regarding revenue repayment.
  - Bonds of healthcare institutions which are subject to the strict rules and
    limits regarding reimbursement payments of California's Medi-Cal program for
    health care services to welfare recipients and bonds secured by liens on
    real property are two of the types of bonds that could be affected by these
    provisions.

NEW JERSEY RISKS

STATE AND LOCAL GOVERNMENT

Certain features of New Jersey law could affect the repayment of debt:

  - the State of New Jersey and its agencies and public authorities issue
    general obligation bonds, which are secured by the full faith and credit of
    the state, backed by its taxing authority, without recourse to specific
    sources of revenue, therefore, any liability to increase taxes could impair
    the state's ability to repay debt; and
  - the state is required by law to maintain a balanced budget, and state
    spending for any given municipality or county cannot increase by more than
    5% per year. This limit could make it harder for any particular county or
    municipality to repay its debts.

In recent years the state budget's main expenditures have been

  - elementary and secondary education, and
  - state agencies and programs, including police and corrections facilities,
    higher education, and environmental protection.

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<PAGE>
The state's general obligations are rated Aa1 by Moody's and AA+ by Standard &
Poor's.

NEW YORK RISKS

GENERALLY

For decades, New York's economy has trailed the rest of the nation. Both the
state and New York City have experienced long-term structural imbalances between
revenues and expenses, and have repeatedly relied substantially on non-recurring
measures to achieve budget balance. The pressures that contribute to budgetary
problems at both the state and local level include:

  - the high combined state and local tax burden;
  - a decline in manufacturing jobs, leading to above-average unemployment;
  - sensitivity to the financial services industry; and
  - dependence on federal aid.

STATE GOVERNMENT

The State government frequently has difficulty approving budgets on time. Budget
gaps of $3 billion and $5 billion are projected for the next two years. The
State's general obligation bonds are rated A+ by Standard & Poor's and A2 by
Moody's. There is $37 billion of state-related debt outstanding.

NEW YORK CITY GOVERNMENT

Even though the City had budget surpluses each year from 1981, budget gaps of
over $2 billion are projected for the 2002, 2003 and 2004 fiscal years. New York
City faces fiscal pressures from:

  - aging public facilities that need repair or replacement;
  - welfare and medical costs;
  - expiring labor contracts; and
  - a high and increasing debt burden.

The City requires substantial state aid, and its fiscal strength depends heavily
on the securities industry. Its general obligation bonds are rated A by Standard
& Poor's and A2 by Moody's. $31.2 billion of combined City, MAC and PBC debt is
outstanding, and the City proposes $25.3 billion of financing over fiscal
1999-2003. New York City currently expects to reach its constitutional limits on
debt issuance in Fiscal 2003.

PENNSYLVANIA RISKS

GENERALLY

Pennsylvania and many of its municipalities (including Philadelphia) have
undergone an economic decline:

  - coal, steel, railroads and other heavy industry historically associated with
    the Commonwealth has given way to increased competition from foreign
    producers.
  - agriculture and related industries are still an important part of the
    Commonwealth's economy.
  - recently, however, service sector industries (trade, medical and health
    services, education and financial services) have provided new sources of
    growth.

STATE AND LOCAL GOVERNMENTS

Historically, both the Commonwealth and the City of Philadelphia have
experienced serious revenue shortfalls. At the same time, rising demands for
state and local programs and services (particularly medical assistance and cash
assistance programs) have led to increased spending.

  - in recent years, both the Commonwealth and the City of Philadelphia have
    tried to

                                       20
<PAGE>
    balance their budgets with a mix of tax increases and spending cuts.
  - Philadelphia has considered significant service cuts and privatization of
    certain services which it has provided to date.
  - In 1991, the Commonwealth created the Pennsylvania Inter-Governmental
    Cooperation Authority ('PICA') which it authorized to issue debt to cover
    Philadelphia's budget shortfalls, eliminate the City's projected deficits
    and fund its capital spending. PICA issued approximately $1.76 billion of
    Special Revenue Bonds on Philadelphia's behalf. Its power to issue bonds on
    Philadelphia's behalf expired at the end of 1996; as of June 30, 1999,
    approximately $1.0 billion in PICA Special Revenue Bonds were outstanding.
  - Pennsylvania's general obligation bonds are currently rated Aa3 by Moody's
    and AA- by Standard & Poor's. Philadelphia's general obligation bonds are
    rated Baa2 by Moody's and BBB by Standard & Poor's. There can be no
    assurance that these ratings will not be lowered.

BOND QUALITY RISK

A reduction in a bond's rating may decrease its value and, indirectly, the value
of your investment in the Fund.

INSURANCE RELATED RISK

The bonds are backed by insurance companies (as shown under Portfolios).
Insurance policies generally make payments only according to a bond's original
payment schedule and do not make early payments when a bond defaults or becomes
taxable. Although the federal government does not regulate the insurance
business, various state laws and federal initiatives and tax law changes could
significantly affect the insurance business. The claims-paying ability of the
insurance companies is generally rated A or better by Standard & Poor's or
another nationally recognized rating organization. The insurance company ratings
are subject to change at any time at the discretion of the rating agencies.

LITIGATION AND LEGISLATION RISKS

We do not know of any pending litigation that might have a material adverse
effect upon the Fund.

Future tax legislation could affect the value of the portfolio by:

  - limiting real property taxes,
  - reducing tax rates,
  - imposing a flat or other form of tax, or
  - exempting investment income from tax.

SELLING OR EXCHANGING UNITS

You can sell your units at any time for a price based on net asset value. Your
net asset value is calculated each business day by:

  - ADDING the value of the bonds, net accrued interest, cash and any other Fund
    assets;
  - SUBTRACTING accrued but unpaid Fund expenses, unreimbursed Trustee advances,
    cash held to buy back units or for distribution to investors and any other
    Fund liabilities; and
  - DIVIDING the result by the number of outstanding units.

Your net asset value when you sell may be more or less than your cost because of
sales fees, market movements and changes in the portfolio.

                                       21
<PAGE>
SPONSORS' SECONDARY MARKET

While we are not obligated to do so, we will buy back units at net asset value
without any other fee or charge. We may resell the units to other buyers or to
the Trustee. You should consult your financial professional for current market
prices to determine if other broker-dealers or banks are offering higher prices.

We have maintained the secondary market continuously for over 30 years, but we
could discontinue it without prior notice for any business reason.

SELLING UNITS TO THE TRUSTEE

Regardless of whether we maintain a secondary market, you can sell your units to
the Trustee at any time by sending the Trustee a letter (with any outstanding
certificates if you hold Unit certificates). You must properly endorse your
certificates (or execute a written transfer instrument with signatures
guaranteed by an eligible institution). Sometimes, additional documents are
needed such as a trust document, certificate of corporate authority, certificate
of death or appointment as executor, administrator or guardian.

Within seven days after your request and the necessary documents are received,
the Trustee will mail a check to you. Contact the Trustee for additional
information.

As long as we are maintaining a secondary market, the Trustee will sell your
units to us at a price based on net asset value. If there is no secondary
market, the Trustee may sell your units in the over-the-counter market for a
higher price, but it is not obligated to do so. In that case, you will receive
the net proceeds of the sale.

If the Fund does not have cash available to pay you for units you are selling,
the agent for the Sponsors will select bonds to be sold. Bonds will be selected
based on market and credit factors. These sales could be made at times when the
bonds would not otherwise be sold and may result in your receiving less than the
unit par value and also reduce the size and diversity of the Fund.

There could be a delay in paying you for your units:

  - if the New York Stock Exchange is closed (other than customary weekend and
    holiday closings);
  - if the SEC determines that trading on the New York Stock Exchange is
    restricted or that an emergency exists making sale or evaluation of the
    bonds not reasonably practicable; and
  - for any other period permitted by SEC order.

EXCHANGE OPTION

You may exchange units of certain Defined Asset Funds for units of this Fund at
a maximum exchange fee of 1.90%. You may exchange units of this Fund for units
of certain other Defined Asset Funds at a reduced sales fee if your investment
goals change. In addition, you may exchange into this Fund from certain other
Defined Asset Funds and unit trusts. To exchange units, you should talk to your
financial professional about what funds are exchangeable, suitable and currently
available.

Normally, an exchange is taxable and you must recognize any gain or loss on the
exchange. However, the IRS may try to disallow a loss if the portfolios of the
two

                                       22
<PAGE>
funds are not materially different; you should consult your own tax adviser.

We may amend or terminate this exchange option at any time without notice.

HOW THE FUND WORKS

PRICING

The price of a unit includes interest accrued on the bonds, less expenses, from
the initial most recent Record Day up to, but not including, the settlement
date, which is usually three business days after the purchase date of the unit.

A portion of the price of a unit consists of cash so that the Trustee can
provide you with regular monthly income. When you sell your units you will
receive your share of this cash.

In addition, as with mutual funds, the Fund (and therefore the investors) pay
all or some of the costs of organizing the Fund including:

  - cost of initial preparation of legal documents;
  - federal and state registration fees;
  - initial fees and expenses of the Trustee;
  - initial audit; and
  - legal expenses and other out-of-pocket expenses.

EVALUATIONS

An independent Evaluator values the bonds on each business day (excluding
Saturdays, Sundays and the following holidays as observed by the New York Stock
Exchange: New Year's Day, Presidents' Day, Martin Luther King, Jr. Day, Good
Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving and Christmas).
Bond values are based on current bid or offer prices for the bonds or comparable
bonds. In the past, the difference between bid and offer prices of publicly
offered tax-exempt bonds has ranged from 0.5% of face amount on actively traded
issues to 3.5% on inactively traded issues; the difference has averaged between
1 and 2%.

INCOME

The Trustee credits interest to an Income Account and other receipts to a
Capital Account. The Trustee may establish a Reserve Account by withdrawing from
these accounts amounts it considers appropriate to pay any material liability.
These accounts do not bear interest.

EXPENSES

The Trustee is paid monthly. It also benefits when it holds cash for the Fund in
non-interest bearing accounts. The Trustee may also receive additional amounts:

  - to reimburse the Trustee for the Fund's operating expenses;
  - for extraordinary services and costs of indemnifying the Trustee and the
    Sponsors;
  - costs of actions taken to protect the Fund and other legal fees and
    expenses;
  - expenses for keeping the Fund's registration statement current; and
  - Fund termination expenses and any governmental charges.

The Sponsors are currently reimbursed up to 55 CENTS per $1,000 face amount
annually for providing portfolio supervisory, bookkeeping and administrative
services and for any other expenses properly chargeable to the Fund. Legal,
typesetting, electronic filing and regulatory filing fees and expenses
associated with updating the Portfolio's registration statement yearly are also
now chargeable to

                                       23
<PAGE>
the Portfolio. While this fee may exceed the amount of these costs and expenses
attributable to this Fund, the total of these fees for all Series of Defined
Asset Funds will not exceed the aggregate amount attributable to all of these
Series for any calendar year. The Fund also pays the Evaluator's fees.

The Trustee's, Sponsors' and Evaluator's fees may be adjusted for inflation
without investors' approval.

The Sponsors will pay advertising and selling expenses at no charge to the Fund.
If Fund expenses exceed initial estimates, the Fund will owe the excess. The
Trustee has a lien on Fund assets to secure reimbursement of Fund expenses and
may sell bonds if cash is not available.

PORTFOLIO CHANGES

The Sponsors and Trustee are not liable for any default or defect in a bond; if
a contract to buy any bond.

Unlike a mutual fund, the portfolio is designed to remain intact and we may keep
bonds in the portfolio even if their credit quality declines or other adverse
financial circumstances occur. However, we may sell a bond in certain cases if
we believe that certain adverse credit conditions exist or if a bond becomes
taxable.

If we maintain a secondary market in units but are unable to sell the units that
we buy in the secondary market, we will redeem units, which may affect the
composition of the portfolio. Units offered in the secondary market may not
represent the same face amount of bonds that they did originally.

We decide whether or not to offer units for sale that we acquire in the
secondary market after reviewing:

  - diversity of the portfolio;
  - size of the Fund relative to its original size;
  - ratio of Fund expenses to income;
  - current and long-term returns;
  - degree to which units may be selling at a premium over par; and
  - cost of maintaining a current prospectus.

FUND TERMINATION

The Fund will terminate following the stated maturity or sale of the last bond
in the portfolio. The Fund may also terminate earlier with the consent of
investors holding 51% of the units or if total assets of the Fund have fallen
below 40% of the face amount of bonds deposited. We will decide whether to
terminate the Fund early based on the same factors used in deciding whether or
not to offer units in the secondary market.

When the Fund is about to terminate you will receive a notice, and you will be
unable to sell your units after that time. On or shortly before termination, we
will sell any remaining bonds, and you will receive your final distribution. Any
bond that cannot be sold at a reasonable price may continue to be held by the
Trustee in a liquidating trust pending its final sale.

You will pay your share of the expenses associated with termination, including
brokerage costs in selling bonds. This may reduce the amount you receive as your
final distribution.

CERTIFICATES

Certificates for units are issued on request. You may transfer certificates by
complying

                                       24
<PAGE>
with the requirements for redeeming certificates, described above. You can
replace lost or mutilated certificates by delivering satisfactory indemnity and
paying the associated costs.

TRUST INDENTURE

The Fund is a "unit investment trust" governed by a Trust Indenture, a contract
among the Sponsors, the Trustee and the Evaluator, which sets forth their duties
and obligations and your rights. A copy of the Indenture is available to you on
request to the Trustee. The following summarizes certain provisions of the
Indenture.

The Sponsors and the Trustee may amend the Indenture without your consent:

  - to cure ambiguities;
  - to correct or supplement any defective or inconsistent provision;
  - to make any amendment required by any governmental agency; or
  - to make other changes determined not to be materially adverse to your best
    interest (as determined by the Sponsors).

Investors holding 51% of the units may amend the Indenture. Every investor must
consent to any amendment that changes the 51% requirement. No amendment may
reduce your interest in the Fund without your written consent.

The Trustee may resign by notifying the Sponsors. The Sponsors may remove the
Trustee without your consent if:

  - it fails to perform its duties and the Sponsors determine that its
    replacement is in your best interest; or
  - it becomes incapable of acting or bankrupt or its affairs are taken over by
    public authorities.

Investors holding 51% of the units may remove the Trustee. The Evaluator may
resign or be removed by the Sponsors and the Trustee without the consent of
investors. The resignation or removal of either becomes effective when a
successor accepts appointment. The Sponsors will try to appoint a successor
promptly; however, if no successor has accepted within 30 days after notice of
resignation, the resigning Trustee or Evaluator may petition a court to appoint
a successor.

Any Sponsor may resign as long as one Sponsor with a net worth of $2 million
remains and agrees to the resignation. The remaining Sponsors and the Trustee
may appoint a replacement. If there is only one Sponsor and it fails to perform
its duties or becomes bankrupt the Trustee may:

  - remove it and appoint a replacement Sponsor;
  - liquidate the Fund; or
  - continue to act as Trustee without a Sponsor.

Merrill Lynch, Pierce, Fenner & Smith Incorporated acts as agent for the
Sponsors.

The Trust Indenture contains customary provisions limiting the liability of the
Trustee, the Sponsors and the Evaluator.

LEGAL OPINION

Davis Polk & Wardwell, 450 Lexington Avenue, New York, New York 10017, as
counsel for the Sponsors, has given an opinion that the units are validly
issued. Special counsel located in the relevant states have given state and
local tax opinions.

                                       25
<PAGE>
AUDITORS

Deloitte & Touche LLP, 2 World Financial Center, New York, New York 10281,
independent accountants, audited the Statements of Condition included in this
prospectus.

SPONSORS

The Sponsors are:
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED (a wholly-owned subsidiary of
Merrill Lynch & Co., Inc.)
P.O. Box 9051,
Princeton, NJ 08543-9051
SALOMON SMITH BARNEY INC. (an indirectly wholly-owned subsidiary of Citigroup
Inc.)
7 World Trade Center--40th Floor,
New York, NY 10048
DEAN WITTER REYNOLDS INC. (a principal operating subsidiary of Morgan Stanley
Dean Witter & Co.)
Two World Trade Center--59th Floor,
New York, NY 10048
PRUDENTIAL SECURITIES INCORPORATED (an
indirect wholly-owned subsidiary of the
Prudential Insurance Company of America)
One New York Plaza
New York, NY 10292
PAINEWEBBER INCORPORATED (an indirect subsidiary of UBS AG and an affiliate of
UBS Warburg LLC)
1285 Avenue of the Americas,
New York, NY 10019

Each Sponsor is a Delaware corporation and it, or its predecessor, has acted as
sponsor to many unit investment trusts. As a registered broker-dealer each
Sponsor buys and sells securities (including investment company shares) for
others (including investment companies) and participates as an underwriter in
various selling groups.

TRUSTEE

The Bank of New York, 101 Barclay Street, 17 W, New York, New York 10268, is the
Trustee. It is supervised by the Federal Deposit Insurance Corporation, the
Board of Governors of the Federal Reserve System and New York State banking
authorities.

UNDERWRITERS' AND SPONSORS' PROFITS

Underwriters receive sales charges when they sell units. The Sponsors also
realized a profit or loss on the initial date of deposit of the bonds. Any cash
made available by you to the Sponsors before the settlement date for those units
may be used in the Sponsors' businesses to the extent permitted by federal law
and may benefit the Sponsors.

A Sponsor or Underwriter may realize profits or sustain losses on bonds in the
Fund which were acquired from underwriting syndicates of which it was a member.

In maintaining a secondary market, the Sponsors will also realize profits or
sustain losses in the amount of any difference between the prices at which they
buy units and the prices at which they resell or redeem them.

PUBLIC DISTRIBUTION

The Sponsors do not intend to qualify units for sale in any foreign countries.
This prospectus does not constitute an offer to sell units in any country where
units cannot lawfully be sold.

CODE OF ETHICS

The Fund and the Agent for the Sponsors have each adopted a code of ethics
requiring reporting of personal securities transactions by

                                       26
<PAGE>
its employees with access to information on Fund transactions. Subject to
certain conditions, the codes permit employees to invest in Fund securities for
their own accounts. The codes are designed to prevent fraud, deception and
misconduct against the Fund and to provide reasonable standards of conduct.
These codes are on file with the Commission and you may obtain a copy by
contacting the Commission at the address listed on the back cover of this
prospectus.

TAXES

The following summary describes some of the important income tax consequences of
holding units. It assumes that you are not a dealer, financial institution,
insurance company or other investor with special circumstances or subject to
special rules. You should consult your own tax adviser about your particular
circumstances.

At the date of issue of each bond, counsel for the issuer delivered an opinion
to the effect that interest on the bond is exempt from regular federal income
tax. However, interest may be subject to state and local taxes and may be taken
into account in determining your preference items for alternative minimum tax
purposes. Neither we nor our counsel have reviewed the issuance of the bonds,
related proceedings or the basis for the opinions of counsel for the issuers. We
cannot assure you that the issuers (or other users of bond proceeds) have
complied or will comply with any requirements necessary for a bond to be
tax-exempt. If any of the bonds were determined not to be tax-exempt, you could
be required to pay income tax for current and prior years, and if the Fund were
to sell the bond, it might have to sell it at a substantial discount.

In the opinion of our counsel, under existing law:

GENERAL TREATMENT OF THE FUND AND YOUR INVESTMENT

The Fund will not be taxed as a corporation for federal income tax purposes, and
you will be considered to own directly your share of each bond in the Fund.

GAIN OR LOSS UPON DISPOSITION

When all or part of your share of a bond is disposed of (for example, when the
Fund sells, exchanges or redeems a bond or when you sell or exchange your
units), you will generally recognize capital gain or loss. Your gain, however,
will generally be ordinary income to the extent of any accrued "market
discount". Generally you will have market discount to the extent that your basis
in a bond when you purchase a unit is less than its stated redemption price at
maturity (or, if it is an original issue discount bond, the issue price
increased by original issue discount that has accrued on the bond before your
purchase). You should consult your tax adviser in this regard.

If your net long-term capital gains exceed your net short-term capital losses,
the excess may be subject to tax at a lower rate than ordinary income. Any
capital gain from the Fund will be long-term if you are considered to have held
your investment on each bond for more than one year and short-term otherwise.
Because the deductibility of capital losses is subject to limitations, you may
not be able to deduct all of your capital losses.

                                       27
<PAGE>
YOUR BASIS IN THE BONDS

Your aggregate basis in the bonds will be equal to the cost of your units,
including any sales charges and the organizational expenses you pay, adjusted to
reflect any accruals of "original issue discount," "acquisition premium" and
"bond premium". You should consult your tax adviser in this regard.

EXPENSES

If you are not a corporate investor, you will not be entitled to a deduction for
your share of fees and expenses of the Fund. Also, if you borrowed money in
order to purchase or carry your units, you will not be able to deduct the
interest on this borrowing for federal income tax purposes. The IRS may treat
your purchase of units as made with borrowed money even if the money is not
directly traceable to the purchase of units.

NEW YORK TAXES

Under the income tax laws of the State and City of New York, the Fund will not
be taxed as a corporation. If you are a New York taxpayer, your income from the
Fund will not be tax-exempt in New York except to the extent that the income is
earned on bonds that are tax-exempt for New York purposes. Depending on where
you live, your income from the Fund may be subject to state and local taxation.
You should consult your tax adviser in this regard.

CALIFORNIA TAXES

In the opinion of O'Melveny & Myers LLP, Los Angeles, California, special
counsel on California tax matters:

Under the income tax laws of the State of California, the Trust will not be
taxed as a corporation and you will be considered to own directly your share of
each bond of the Trust. If you are a California taxpayer, your share of the
income from the bonds of the Trust will not be tax-exempt in California except
for California personal income tax purposes and only to the extent that the
income is earned on bonds that are exempt for such purposes. If you are a
California taxpayer and all or part of your share of a bond is disposed of (for
example, when a bond is sold, exchanged or redeemed at maturity or you sell or
exchange your units), you will recognize gain or loss for California tax
purposes. Depending on where you live, your income from the Trust may be subject
to state and local taxation. You should consult your tax adviser in this regard.

NEW JERSEY TAXES

In the opinion of Drinker Biddle & Reath LLP, Philadelphia, Pennsylvania,
special counsel on New Jersey tax matters:

The Fund will not be taxed as a corporation under the current income tax laws of
the State of New Jersey. Your income from the Fund may be subject to taxation
depending on where you live. If you are a New Jersey taxpayer your income from
the Fund (including gains on sales of bonds by the Fund) and gains on sales of
units by you will be tax-exempt to the extent that income and gains are earned
on bonds that are tax-exempt for New Jersey purposes. You should consult your
tax adviser as to the consequences to you with respect to any investment you
make in the Fund.

PENNSYLVANIA TAXES

In the opinion of Drinker Biddle & Reath LLP, Philadelphia, Pennsylvania,
special counsel on Pennsylvania tax matters:
                                       28
<PAGE>
The Pennsylvania Trust will not be taxed as a corporation under the current
income tax laws of Pennsylvania. Your income from the Trust may be subject to
taxation depending on where you live. If you are a Pennsylvania taxpayer your
interest income from the Trust will be tax-exempt to the extent that income is
earned on bonds that are tax-exempt for Pennsylvania purposes. However, gains on
the sale of bonds by the Trust or on the sale of your units will be subject to
Pennsylvania income tax. If you are a Philadelphia resident you may be subject
to the Philadelphia school district tax on any gains realized from the sale of
bonds by the Trust or the sale of units by you to the extent either the bonds or
units have been held for six months or less. You should consult your tax adviser
as to the consequences to you with respect to any investment you make in the
Trust.

SUPPLEMENTAL INFORMATION

You can receive at no cost supplemental information about the Fund by calling
the Trustee. The supplemental information includes more detailed risk disclosure
about the types of bonds that may be in the Fund's portfolios, general risk
disclosure concerning any insurance securing certain bonds, and general
information about the structure and operation of the Fund. The supplemental
information is also available from the SEC.

                                       29
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97 (CALIFORNIA, NEW JERSEY, NEW YORK AND
PENNSYLVANIA TRUSTS)
DEFINED ASSET FUNDS


REPORT OF INDEPENDENT ACCOUNTANTS


The Sponsors, Trustee and Holders
  of Municipal Investment Trust Fund,
  Multistate Series - 97 (California, New Jersey, New York and
  Pennsylvania Trusts)
  Defined Asset Funds:

We have audited the accompanying statements of condition of Municipal
Investment Trust Fund, Multistate Series - 97 (California, New
Jersey, New York and Pennsylvania Trusts) Defined Asset Funds,
including the portfolios, as of October 31, 2000 and the related
statements of operations and of changes in net assets for the years
ended October 31, 2000, 1999 and 1998. These financial statements are
the responsibility of the Trustee. Our responsibility is to express
an opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards
generally accepted in the United States of America. Those standards
require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements.
Securities owned at October 31, 2000, as shown in such portfolios,
were confirmed to us by The Bank of New York, the Trustee. An audit
also includes assessing the accounting principles used and
significant estimates made by the Trustee, as well as evaluating the
overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Municipal
Investment Trust Fund, Multistate Series - 97 (California, New
Jersey, New York and Pennsylvania Trusts) Defined Asset Funds at
October 31, 2000 and the results of their operations and changes in
their net assets for the above-stated years in conformity with
accounting principles generally accepted in the United States of
America.


DELOITTE & TOUCHE LLP

New York, N.Y.
December 30, 2000


                                      D - 1
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97 (CALIFORNIA TRUST),
DEFINED ASSET FUNDS

STATEMENT OF CONDITION
AS OF OCTOBER 31, 2000

<TABLE>
<S>                                                <C>           <C>
TRUST PROPERTY:
  Investment in marketable securities - at value
    (cost $4,136,881)(Note 1)......................                  $4,267,311
  Accrued interest receivable......................                      70,140
  Cash.............................................                       7,571
                                                                   _____________

              Total trust property.................                   4,345,022

LESS LIABILITY - Accrued expenses..................                       3,934
                                                                   _____________

NET ASSETS, REPRESENTED BY:
  4,322 units of fractional undivided
    interest outstanding (Note 3)..................   $4,327,009
  Undistributed net investment income..............       14,079
                                                    _____________
                                                                     $4,341,088
                                                                   =============
UNIT VALUE ($4,341,088/4,322 units)................                   $1,004.42
                                                                   =============
</TABLE>

                       See Notes to Financial Statements.


                                      D - 2
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97 (CALIFORNIA TRUST),
DEFINED ASSET FUNDS

STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                             .......Years Ended October 31,..........
                                                 2000         1999         1998
                                             _________________________________________
<S>                                        <C>          <C>          <C>
INVESTMENT INCOME:
  Interest income...........................    $249,431     $269,770     $275,257
  Trustee's fees and expenses...............      (6,249)      (6,094)      (5,973)
  Sponsors' fees............................      (2,737)      (2,609)      (2,246)
  Organizational expenses...................      (1,009)      (1,009)      (1,009)
                                             _________________________________________
  Net investment income.....................     239,436      260,058      266,029
                                             _________________________________________

REALIZED AND UNREALIZED GAIN (LOSS)
  ON INVESTMENTS:
  Realized gain (loss) on securities
    sold or redeemed........................      (7,032)       2,409        4,294
  Unrealized appreciation (depreciation)
    of investments..........................     239,068     (486,777)     214,821
                                             _________________________________________

  Net realized and unrealized gain (loss)
    on investments..........................     232,036     (484,368)     219,115
                                             _________________________________________

NET INCREASE (DECREASE) IN NET ASSETS
  RESULTING FROM OPERATIONS.................    $471,472    $(224,310)    $485,144
                                             =========================================
</TABLE>

                       See Notes to Financial Statements.


                                      D - 3
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97 (CALIFORNIA TRUST),
DEFINED ASSET FUNDS

STATEMENTS OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
                                               .......Years Ended October 31,..........
                                                   2000         1999         1998
                                               _________________________________________
<S>                                          <C>          <C>          <C>
OPERATIONS:
  Net investment income.......................  $  239,436   $  260,058   $  266,029
  Realized gain (loss) on securities
    sold or redeemed..........................      (7,032)       2,409        4,294
  Unrealized appreciation (depreciation)
    of investments............................     239,068     (486,777)     214,821
                                               _________________________________________
  Net increase (decrease) in net assets
    resulting from operations.................     471,472     (224,310)     485,144
                                               _________________________________________

DISTRIBUTIONS TO HOLDERS (Note 2):
  Income......................................    (240,103)    (260,500)    (265,408)
  Principal...................................      (4,820)      (7,025)
                                               _________________________________________
  Total distributions.........................    (244,923)    (267,525)    (265,408)
                                               _________________________________________
CAPITAL SHARE TRANSACTIONS - Redemptions of
  498, 127 and 100 units, respectively........    (482,265)    (126,968)    (103,113)
                                               _________________________________________
NET INCREASE (DECREASE) IN NET ASSETS.........    (255,716)    (618,803)     116,623

NET ASSETS AT BEGINNING OF YEAR...............   4,596,804    5,215,607    5,098,984
                                               _________________________________________
NET ASSETS AT END OF YEAR.....................  $4,341,088   $4,596,804   $5,215,607
                                               =========================================
PER UNIT:
  Income distributions during year............      $52.59       $53.01       $52.99
                                               =========================================
  Principal distributions during year.........       $1.00        $1.42
                                               =========================================
  Net asset value at end of year..............   $1,004.42      $953.69    $1,054.30
                                               =========================================
TRUST UNITS OUTSTANDING AT END OF YEAR........       4,322        4,820        4,947
                                               =========================================
</TABLE>

                       See Notes to Financial Statements.


                                      D - 4
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97 (CALIFORNIA TRUST),
DEFINED ASSET FUNDS


NOTES TO FINANCIAL STATEMENTS


  1.  SIGNIFICANT ACCOUNTING POLICIES

      The Fund is registered under the Investment Company Act of 1940 as
      a Unit Investment Trust. The following is a summary of significant
      accounting policies consistently followed by the Fund in the
      preparation of its financial statements. The policies are in
      conformity with accounting principles generally accepted in the
      United States of America.

      (a) Securities are stated at value as determined by the Evaluator
          based on bid side evaluations for the securities.

      (b) The Fund is not subject to income taxes. Accordingly, no
          provision for such taxes is required.

      (c) Interest income is recorded as earned.

  2.  DISTRIBUTIONS

      A distribution of net investment income is made to Holders each
      month. Receipts other than interest, after deductions for
      redemptions and applicable expenses, are also distributed
      periodically.

  3.  NET CAPITAL

<TABLE>
<S>                                                      <C>
      Cost of 4,322 units at Date of Deposit..............    $4,409,057
      Less sales charge...................................       196,608
                                                           ______________
      Net amount applicable to Holders....................     4,212,449
      Redemptions of units - net cost of 725 units
        redeemed less redemption amounts..................        (3,696)
      Realized loss on securities sold or redeemed........          (329)
      Principal distributions.............................       (11,845)
      Unrealized appreciation of investments..............       130,430
                                                           ______________

      Net capital applicable to Holders...................    $4,327,009
                                                           ==============
</TABLE>

  4.  INCOME TAXES

      As of October 31, 2000, unrealized appreciation of investments, based
      on cost for Federal income tax purposes, aggregated $130,430, all of
      which related to appreciated securities. The cost of investment
      securities for Federal income tax purposes was $4,136,881 at
      October 31, 2000.

  5.  DEFERRED ORGANIZATIONAL COSTS

      Organizational costs have been deferred and are being amortized over
      five years.


                                      D - 5
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97
DEFINED ASSET FUNDS

PORTFOLIO OF THE CALIFORNIA TRUST (INSURED)
AS OF OCTOBER 31, 2000

<TABLE>
<CAPTION>                                Rating                                         Optional
    Portfolio No. and Title of               of           Face                          Redemption
            Securities(4)                Issues(1)       Amount    Coupon Maturities(3) Provisions(3)          Cost      Value(2)
            _____________                _________       ______    ______ _____________ _____________          ____      ________
 <S>                                   <C>         <C>            <C>       <C>         <C>            <C>             <C>
 1 California Statewide Comm. Dev.         AAA       $  750,000     5.500%    2023        08/15/03       $  729,127      $751,185
   Auth., (Sutter Hlth. Oblig. Grp.)                                                      @ 102.000
   (MBIA Ins.)

 2 Southern California Public Power        AAA          750,000     5.000     2020        01/01/03          686,100       717,848
   Authority, San Juan Power Project                                                      @ 100.000
   Revenue Bonds  Ser. 1993 A (MBIA
   Ins.)

 3 City of Fresno, California, Water       AAA          705,000     5.300     2020        06/01/03          672,387       699,875
   System Revenue Refunding Bonds,                                                        @ 101.000
   1993 Ser. A (Financial Guaranty
   Ins.)

 4 County of Madera, CA, Cert. of          AAA          715,000     5.750     2028        03/15/05          709,745       726,368
   Part. (Valley Children's Hosp.                                                         @ 102.000
   Proj.), Ser. 1995 (MBIA Ins.)

 5 Poway Redevelopment Agency,             AAA          715,000     5.750     2026        12/15/03          707,035       726,654
   California, Parguay Redevelopment                                                      @ 102.000
   Project, Subordinated Tax
   Allocation Refunding Revenue Bonds,
   Ser. 1993 (Financial Guaranty Ins.)

 6 The City of San Diego, CA, Indl.        AAA          345,000     5.900     2018        06/01/03          347,487       355,681
   Dev. Rev. Rfdg. Bonds (San Diego                                                       @ 102.000
   Gas & Elec. Co.), Ser. 1993 A
   (AMBAC Ins.)

 7 Brea Redevelopment Agency, Orange       AAA          285,000     5.750     2023        08/01/03          285,000       289,700
   County, California, 1993 Tax                                                             @ 102.000
   Allocation Refunding Bonds (MBIA
   Ins.)
                                                   ______________                                     ______________ ______________
TOTAL                                                $4,265,000                                          $4,136,881    $4,267,311
                                                   ==============                                     ============== ==============
</TABLE>

                     See Notes to Portfolios on Page D - 22.


                                      D - 6
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97 (NEW JERSEY TRUST),
DEFINED ASSET FUNDS

STATEMENT OF CONDITION
AS OF OCTOBER 31, 2000

<TABLE>
<S>                                                <C>           <C>
TRUST PROPERTY:
  Investment in marketable securities - at value
    (cost $2,572,846)(Note 1)......................                  $2,600,005
  Accrued interest receivable......................                      52,842
                                                                   _____________

              Total trust property.................                   2,652,847

LESS LIABILITIES:
  Advance from Trustee.............................   $   13,393
  Accrued expenses.................................        2,904         16,297
                                                    _____________  _____________

NET ASSETS, REPRESENTED BY:
  2,665 units of fractional undivided
    interest outstanding (Note 3)..................    2,628,449
  Undistributed net investment income..............        8,101
                                                    _____________
                                                                     $2,636,550
                                                                   =============
UNIT VALUE ($2,636,550/2,665 units)................                     $989.32
                                                                   =============
</TABLE>

                       See Notes to Financial Statements.


                                      D - 7
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97 (NEW JERSEY TRUST),
DEFINED ASSET FUNDS

STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                             .......Years Ended October 31,..........
                                                 2000         1999         1998
                                             _________________________________________
<S>                                        <C>          <C>          <C>
INVESTMENT INCOME:
  Interest income...........................    $148,304     $158,125     $176,297
  Trustee's fees and expenses...............      (5,007)      (4,694)      (4,812)
  Sponsors' fees............................      (1,627)      (1,606)      (1,451)
  Organizational expenses...................        (657)        (656)        (656)
                                             _________________________________________
  Net investment income.....................     141,013      151,169      169,378
                                             _________________________________________

REALIZED AND UNREALIZED GAIN (LOSS)
  ON INVESTMENTS:
  Realized gain on securities sold
    or redeemed.............................         117       21,794        8,908
  Unrealized appreciation (depreciation)
    of investments..........................      93,961     (252,392)     121,341
                                             _________________________________________

  Net realized and unrealized gain (loss)
    on investments..........................      94,078     (230,598)     130,249
                                             _________________________________________

NET INCREASE (DECREASE) IN NET ASSETS
  RESULTING FROM OPERATIONS.................    $235,091     $(79,429)    $299,627
                                             =========================================
</TABLE>

                       See Notes to Financial Statements.


                                      D - 8
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97 (NEW JERSEY TRUST),
DEFINED ASSET FUNDS

STATEMENTS OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
                                               .......Years Ended October 31,..........
                                                   2000         1999         1998
                                               _________________________________________
<S>                                          <C>          <C>          <C>
OPERATIONS:
  Net investment income.......................  $  141,013   $  151,169   $  169,378
  Realized gain on securities sold
    or redeemed...............................         117       21,794        8,908
  Unrealized appreciation (depreciation)
    of investments............................      93,961     (252,392)     121,341
                                               _________________________________________
  Net increase (decrease) in net assets
    resulting from operations.................     235,091      (79,429)     299,627
                                               _________________________________________

DISTRIBUTIONS TO HOLDERS (Note 2):
  Income......................................    (141,504)    (151,992)    (169,062)
  Principal...................................                  (24,822)
                                               _________________________________________
  Total distributions.........................    (141,504)    (176,814)    (169,062)
                                               _________________________________________
CAPITAL SHARE TRANSACTIONS - Redemptions of
  107, 333 and 176 units, respectively........    (103,389)    (343,036)    (183,037)
                                               _________________________________________
NET DECREASE IN NET ASSETS....................      (9,802)    (599,279)     (52,472)

NET ASSETS AT BEGINNING OF YEAR...............   2,646,352    3,245,631    3,298,103
                                               _________________________________________
NET ASSETS AT END OF YEAR.....................  $2,636,550   $2,646,352   $3,245,631
                                               =========================================
PER UNIT:
  Income distributions during year............      $51.88       $52.13       $52.35
                                               =========================================
  Principal distributions during year.........                    $8.54
                                               =========================================
  Net asset value at end of year..............     $989.32      $954.67    $1,045.29
                                               =========================================
TRUST UNITS OUTSTANDING AT END OF YEAR........       2,665        2,772        3,105
                                               =========================================
</TABLE>

                       See Notes to Financial Statements.


                                      D - 9
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97 (NEW JERSEY TRUST),
DEFINED ASSET FUNDS


NOTES TO FINANCIAL STATEMENTS


  1.  SIGNIFICANT ACCOUNTING POLICIES

      The Fund is registered under the Investment Company Act of 1940 as
      a Unit Investment Trust. The following is a summary of significant
      accounting policies consistently followed by the Fund in the
      preparation of its financial statements. The policies are in
      conformity with accounting principles generally accepted in the
      United States of America.

      (a) Securities are stated at value as determined by the Evaluator
          based on bid side evaluations for the securities.

      (b) The Fund is not subject to income taxes. Accordingly, no
          provision for such taxes is required.

      (c) Interest income is recorded as earned.

  2.  DISTRIBUTIONS

      A distribution of net investment income is made to Holders each
      month. Receipts other than interest, after deductions for
      redemptions and applicable expenses, are also distributed
      periodically.

  3.  NET CAPITAL
<TABLE>
<S>                                                      <C>
      Cost of 2,665 units at Date of Deposit..............    $2,740,682
      Less sales charge...................................       122,190
                                                           ______________
      Net amount applicable to Holders....................     2,618,492
      Redemptions of units - net cost of 616 units
        redeemed less redemption amounts..................       (23,199)
      Realized gain on securities sold or redeemed........        30,819
      Principal distributions.............................       (24,822)
      Net unrealized appreciation of investments..........        27,159
                                                           ______________

      Net capital applicable to Holders...................    $2,628,449
                                                           ==============
</TABLE>

  4.  INCOME TAXES

      As of October 31, 2000, net unrealized appreciation of investments,
      based on cost for Federal income tax purposes, aggregated $27,159,
      of which $27,199 related to appreciated securities and $40 related
      to depreciated securities. The cost of investment securities for
      Federal income tax purposes was $2,572,846 at October 31, 2000.

  5.  DEFERRED ORGANIZATIONAL COSTS

      Organizational costs have been deferred and are being amortized over
      five years.


                                     D - 10
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97
DEFINED ASSET FUNDS

PORTFOLIO OF THE NEW JERSEY TRUST (INSURED)
AS OF OCTOBER 31, 2000

<TABLE>
<CAPTION>
                                         Rating                                       Optional
    Portfolio No. and Title of               of           Face                        Redemption
            Securities(4)                Issues(1)       Amount  Coupon Maturities(3) Provisions(3)            Cost      Value(2)
            _____________                _________       ______  ______ _____________ _____________            ____      ________
<S>                                    <C>       <C>           <C>       <C>         <C>                <C>           <C>
 1 New Jersey Educl. Fac. Auth., Rev.      AAA       $  470,000   5.750%   2023         07/01/03         $  475,165      $476,279
   Bonds, Rowan College of New Jersey                                                   @ 102.00
   Iss., Ser. 1993 A (AMBAC Ins.)

 2 New Jsey Hsg. and Mtge. Fin. Agy.,      AAA          500,000   6.100    2030         05/01/05            507,500       507,460
   Multi-Family Hsg. Rev. Bonds, 1995                                                   @ 102.000
   Ser. A (AMBAC Ins.)

 3 County of Essex, New Jersey, General    AAA          120,000   5.500    2015         09/01/05            120,000       122,384
   Obligation Refunding Bonds 1995,                                                     @ 102.000
   Ser. A (AMBAC Ins.)

 4 The Pollution Ctl. Fin. Auth. of        AAA          410,000   5.550    2033         11/01/03            400,484       410,000
   Salem Cnty., NJ, Poll. Ctl. Rev. Rfdg.                                               @ 102.000
   Bonds, (Public Svc. Elec. & Gas Co.
   1993 Ser. C (MBIA Ins.)

 5 The Jersey City Swr. Auth., H           AAA          500,000   4.500    2019         01/01/03            434,920       443,510
   County, New Jersey, Sewer Revenue                                                    @ 100.000
   Refunding Bonds, 1993 Ser. B
   (Financial Guaranty Ins.)

 6 School Bonds of the Board of            AAA          500,000   5.650    2025         02/01/07            504,090       504,770
   Education of the Township of                                                         @ 100.000
   Branchburg in the County of
   Somerset, New Jersey (Financial
   Guaranty Ins.)

 7 The Board of Education of               AAA          130,000   5.625    2020(5)      02/15/03            130,687       135,602
   Township of Lumberton in the County                                                  @ 102.000
   of Burlington, New Jersey, School
   Bonds (MBIA Ins.)
                                                     ______________                                   ______________ ______________
TOTAL                                                  $2,630,000                                        $2,572,846    $2,600,005
                                                     ==============                                   ============== ==============
</TABLE>

                     See Notes to Portfolios on Page D - 22.


                                     D - 11
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97 (NEW YORK TRUST),
DEFINED ASSET FUNDS

STATEMENT OF CONDITION
AS OF OCTOBER 31, 2000

<TABLE>
<S>                                                <C>           <C>
TRUST PROPERTY:
  Investment in marketable securities - at value
    (cost $2,737,528)(Note 1)......................                  $2,767,169
  Accrued interest receivable......................                      48,596
                                                                   _____________

              Total trust property.................                   2,815,765

LESS LIABILITIES:
  Advance from Trustee.............................   $    1,684
  Accrued expenses.................................        3,041          4,725
                                                    _____________  _____________

NET ASSETS, REPRESENTED BY:
  2,847 units of fractional undivided
    interest outstanding (Note 3)..................    2,802,556
  Undistributed net investment income..............        8,484
                                                    _____________
                                                                     $2,811,040
                                                                   =============
UNIT VALUE ($2,811,040/2,847 units)................                     $987.37
                                                                   =============
</TABLE>

                       See Notes to Financial Statements.


                                     D - 12
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97 (NEW YORK TRUST),
DEFINED ASSET FUNDS

STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                             .......Years Ended October 31,..........
                                                 2000         1999         1998
                                             _________________________________________
<S>                                        <C>          <C>          <C>
INVESTMENT INCOME:
  Interest income...........................    $163,187     $189,327     $203,043
  Trustee's fees and expenses...............      (5,227)      (5,130)      (5,193)
  Sponsors' fees............................      (1,835)      (1,862)      (1,731)
  Organizational expenses...................        (806)        (808)        (808)
                                             _________________________________________
  Net investment income.....................     155,319      181,527      195,311
                                             _________________________________________

REALIZED AND UNREALIZED GAIN (LOSS)
  ON INVESTMENTS:
  Realized gain (loss) on securities
    sold or redeemed........................        (480)       8,907        9,746
  Unrealized appreciation (depreciation)
    of investments..........................     142,466     (356,388)     131,739
                                             _________________________________________

  Net realized and unrealized gain (loss)
    on investments..........................     141,986     (347,481)     141,485
                                             _________________________________________

NET INCREASE (DECREASE) IN NET ASSETS
  RESULTING FROM OPERATIONS.................    $297,305    $(165,954)    $336,796
                                             =========================================
</TABLE>

                       See Notes to Financial Statements.


                                     D - 13
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97 (NEW YORK TRUST),
DEFINED ASSET FUNDS

STATEMENTS OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
                                               .......Years Ended October 31,..........
                                                   2000         1999         1998
                                               _________________________________________
<S>                                          <C>          <C>          <C>
OPERATIONS:
  Net investment income.......................  $  155,319   $  181,527   $  195,311
  Realized gain (loss) on securities
    sold or redeemed..........................        (480)       8,907        9,746
  Unrealized appreciation (depreciation)
    of investments............................     142,466     (356,388)     131,739
                                               _________________________________________
  Net increase (decrease) in net assets
    resulting from operations.................     297,305     (165,954)     336,796
                                               _________________________________________

DISTRIBUTIONS TO HOLDERS (Note 2):
  Income......................................    (156,147)    (183,302)    (194,853)
  Principal...................................      (3,665)      (6,104)      (5,407)
                                               _________________________________________
  Total distributions.........................    (159,812)    (189,406)    (200,260)
                                               _________________________________________
CAPITAL SHARE TRANSACTIONS - Redemptions of
  233, 597 and 324 units, respectively........    (225,109)    (592,884)    (333,050)
                                               _________________________________________
NET DECREASE IN NET ASSETS....................     (87,616)    (948,244)    (196,514)

NET ASSETS AT BEGINNING OF YEAR...............   2,898,656    3,846,900    4,043,414
                                               _________________________________________
NET ASSETS AT END OF YEAR.....................  $2,811,040   $2,898,656   $3,846,900
                                               =========================================
PER UNIT:
  Income distributions during year............      $51.40       $51.92       $52.03
                                               =========================================
  Principal distributions during year.........       $1.19        $1.66        $1.39
                                               =========================================
  Net asset value at end of year..............     $987.37      $941.12    $1,046.21
                                               =========================================
TRUST UNITS OUTSTANDING AT END OF YEAR........       2,847        3,080        3,677
                                               =========================================
</TABLE>

                       See Notes to Financial Statements.


                                     D - 14
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97 (NEW YORK TRUST),
DEFINED ASSET FUNDS


NOTES TO FINANCIAL STATEMENTS


  1.  SIGNIFICANT ACCOUNTING POLICIES

      The Fund is registered under the Investment Company Act of 1940 as
      a Unit Investment Trust. The following is a summary of significant
      accounting policies consistently followed by the Fund in the
      preparation of its financial statements. The policies are in
      conformity with accounting principles generally accepted in the
      United States of America.

      (a) Securities are stated at value as determined by the Evaluator
          based on bid side evaluations for the securities.

      (b) The Fund is not subject to income taxes. Accordingly, no
          provision for such taxes is required.

      (c) Interest income is recorded as earned.

  2.  DISTRIBUTIONS

      A distribution of net investment income is made to Holders each
      month. Receipts other than interest, after deductions for
      redemptions and applicable expenses, are also distributed
      periodically.

  3.  NET CAPITAL

<TABLE>
<S>                                                      <C>
      Cost of 2,847 units at Date of Deposit..............    $2,919,459
      Less sales charge...................................       130,164
                                                           ______________
      Net amount applicable to Holders....................     2,789,295
      Redemptions of units - net cost of 1,191 units
        redeemed less redemption amounts..................       (19,925)
      Realized gain on securities sold or redeemed........        18,721
      Principal distributions.............................       (15,176)
      Net unrealized appreciation of investments..........        29,641
                                                           ______________

      Net capital applicable to Holders...................    $2,802,556
                                                           ==============
</TABLE>

  4.  INCOME TAXES

      As of October 31, 2000, net unrealized appreciation of investments,
      based on cost for Federal income tax purposes, aggregated $29,641,
      of which $31,717 related to appreciated securities and $2,076
      related to depreciated securities. The cost of investment securities for
      Federal income tax purposes was $2,737,528 at October 31, 2000.

  5.  DEFERRED ORGANIZATIONAL COSTS

      Organizational costs have been deferred and are being amortized over
      five years.


                                     D - 15
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97
DEFINED ASSET FUNDS

PORTFOLIO OF THE NEW YORK TRUST (INSURED)
AS OF OCTOBER 31, 2000

<TABLE>
<CAPTION>
                                        Rating                                        Optional
    Portfolio No. and Title of              of           Face                         Redemption
            Securities(4)               Issues(1)        Amount  Coupon Maturities(3) Provisions(3)            Cost      Value(2)
            _____________               _________        ______  ______ _____________ _____________            ____      ________
<S>                                      <C>       <C>           <C>       <C>        <C>            <C>           <C>
 1 Dormitory Auth. of the State of New     AAA       $  600,000   5.500%   2023         07/01/04         $  591,558    $  590,028
   York, Fordham Univ., Ins. Rev.                                                       @ 102.000
   Bonds, Ser. 1994 (Financial
   Guaranty Ins.)

 2 Dormitory Auth. of the State of         AAA          600,000   5.000    2021         07/01/04            551,244       550,698
   New York, Mt. Sinai Sch. of                                                          @ 102.000
   Medicine, Ins. Rev. Bonds, Ser.
   1994 A (MBIA Ins.)

 3 Dormitory Auth. of the State of New     AAA          135,000   5.750    2014         07/01/04            136,058       138,860
   York. Univ. of Rochester Strong                                                      @ 102.000
   Mem. Hos., Rev. Bonds Ser. 1994
   (MBIA Ins.)

 4 New York State Med. Care Fac. Fin.      AAA          400,000   5.375    2014         02/15/04            387,520       403,168
   Agy., Mental Hlth. Svc. Fac. Imp.                                                    @ 102.000
   Rev. Bonds. 1993 Ser. F Rfdg. (FSAM
   Ins.)

 5 New York State Urban Dev. Corp.,        AAA          600,000   5.250    2018         01/01/03            574,284       583,428
   Correctional Fac. Rev. Bonds, 1993                                                   @ 102.000
   Rfdg. Ser. (AMBAC Ins.)

 6 New York City, NY, Mun. Wtr. Fin.       AAA          165,000   6.000    2017         06/15/02            167,759       168,805
   Auth., Wtr. and Swr. Sys. Rev.                                                       @ 101.500
   Bonds, Fiscal 1993 Ser. A (FSAM
   Ins.)

 7 Puerto Rico Pub. Bldgs. Auth.,          AAA          325,000   5.750    2022         07/01/05            329,105       332,182
   Govt. Fac. Rev. Bonds, Ser. A                                                        @ 101.500
   (AMBAC Ins.)
                                                   ______________                                     ______________ ______________
TOTAL                                                $2,825,000                                          $2,737,528    $2,767,169
                                                   ==============                                     ============== ==============
</TABLE>

                     See Notes to Portfolios on Page D - 22.


                                     D - 16
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97 (PENNSYLVANIA TRUST),
DEFINED ASSET FUNDS

STATEMENT OF CONDITION
AS OF OCTOBER 31, 2000

<TABLE>
<S>                                                <C>           <C>
TRUST PROPERTY:
  Investment in marketable securities - at value
    (cost $2,163,314)(Note 1)......................                  $2,193,681
  Accrued interest receivable......................                      30,658
  Cash.............................................                       8,323
                                                                   _____________

              Total trust property.................                   2,232,662

LESS LIABILITY - Accrued expenses..................                       2,726
                                                                   _____________

NET ASSETS, REPRESENTED BY:
  2,232 units of fractional undivided
    interest outstanding (Note 3)..................   $2,222,945
  Undistributed net investment income..............        6,991
                                                    _____________
                                                                     $2,229,936
                                                                   =============
UNIT VALUE ($2,229,936/2,232 units)................                     $999.08
                                                                   =============
</TABLE>

                       See Notes to Financial Statements.


                                     D - 17
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97 (PENNSYLVANIA TRUST),
DEFINED ASSET FUNDS

STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                             .......Years Ended October 31,..........
                                                 2000         1999         1998
                                             _________________________________________
<S>                                        <C>          <C>          <C>
INVESTMENT INCOME:
  Interest income...........................    $131,687     $150,903     $171,151
  Trustee's fees and expenses...............      (4,771)      (4,554)      (4,727)
  Sponsors' fees............................      (1,419)      (1,468)      (1,405)
  Organizational expenses...................        (657)        (656)        (656)
                                             _________________________________________
  Net investment income.....................     124,840      144,225      164,363
                                             _________________________________________

REALIZED AND UNREALIZED GAIN (LOSS)
  ON INVESTMENTS:
  Realized gain on securities sold
    or redeemed.............................       7,323       14,372        2,611
  Unrealized appreciation (depreciation)
    of investments..........................      84,233     (243,907)      99,217
                                             _________________________________________

  Net realized and unrealized gain (loss)
    on investments..........................      91,556     (229,535)     101,828
                                             _________________________________________

NET INCREASE (DECREASE) IN NET ASSETS
  RESULTING FROM OPERATIONS.................    $216,396     $(85,310)    $266,191
                                             =========================================
</TABLE>

                       See Notes to Financial Statements.


                                     D - 18
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97 (PENNSYLVANIA TRUST),
DEFINED ASSET FUNDS

STATEMENTS OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
                                               .......Years Ended October 31,..........
                                                   2000         1999         1998
                                               _________________________________________
<S>                                          <C>          <C>          <C>
OPERATIONS:
  Net investment income.......................  $  124,840   $  144,225   $  164,363
  Realized gain on securities sold
    or redeemed...............................       7,323       14,372        2,611
  Unrealized appreciation (depreciation)
    of investments............................      84,233     (243,907)      99,217
                                               _________________________________________
  Net increase (decrease) in net assets
    resulting from operations.................     216,396      (85,310)     266,191
                                               _________________________________________

DISTRIBUTIONS TO HOLDERS (Note 2):
  Income......................................    (125,548)    (144,834)    (163,829)
  Principal...................................      (2,778)      (8,424)      (6,184)
                                               _________________________________________
  Total distributions.........................    (128,326)    (153,258)    (170,013)
                                               _________________________________________
CAPITAL SHARE TRANSACTIONS - Redemptions of
  460, 335 and 112 units, respectively........    (445,519)    (348,188)    (115,530)
                                               _________________________________________
NET DECREASE IN NET ASSETS....................    (357,449)    (586,756)     (19,352)

NET ASSETS AT BEGINNING OF YEAR...............   2,587,385    3,174,141    3,193,493
                                               _________________________________________
NET ASSETS AT END OF YEAR.....................  $2,229,936   $2,587,385   $3,174,141
                                               =========================================
PER UNIT:
  Income distributions during year............      $52.54       $52.76       $52.98
                                               =========================================
  Principal distributions during year.........       $1.05        $3.08        $1.97
                                               =========================================
  Net asset value at end of year..............     $999.08      $961.14    $1,048.61
                                               =========================================
TRUST UNITS OUTSTANDING AT END OF YEAR........       2,232        2,692        3,027
                                               =========================================
</TABLE>

                       See Notes to Financial Statements.


                                     D - 19
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97 (PENNSYLVANIA TRUST),
DEFINED ASSET FUNDS


NOTES TO FINANCIAL STATEMENTS


  1.  SIGNIFICANT ACCOUNTING POLICIES

      The Fund is registered under the Investment Company Act of 1940 as
      a Unit Investment Trust. The following is a summary of significant
      accounting policies consistently followed by the Fund in the
      preparation of its financial statements. The policies are in
      conformity with accounting principles generally accepted in the
      United States of America.

      (a) Securities are stated at value as determined by the Evaluator
          based on bid side evaluations for the securities.

      (b) The Fund is not subject to income taxes. Accordingly, no
          provision for such taxes is required.

      (c) Interest income is recorded as earned.

  2.  DISTRIBUTIONS

      A distribution of net investment income is made to Holders each
      month. Receipts other than interest, after deductions for
      redemptions and applicable expenses, are also distributed
      periodically.

  3.  NET CAPITAL

<TABLE>
<S>                                                      <C>
      Cost of 2,232 units at Date of Deposit..............    $2,302,520
      Less sales charge...................................       102,649
                                                           ______________
      Net amount applicable to Holders....................     2,199,871
      Redemptions of units - net cost of 1,049 units
        redeemed less redemption amounts..................       (14,654)
      Realized gain on securities sold or redeemed........        24,747
      Principal distributions.............................       (17,386)
      Unrealized appreciation of investments..............        30,367
                                                           ______________

      Net capital applicable to Holders...................    $2,222,945
                                                           ==============
</TABLE>

  4.  INCOME TAXES

      As of October 31, 2000, unrealized appreciation of investments, based
      on cost for Federal income tax purposes, aggregated $30,367, all of
      which related to appreciated securities. The cost of investment
      securities for Federal income tax purposes was $2,163,314 at
      October 31, 2000.

  5.  DEFERRED ORGANIZATIONAL COSTS

      Organizational costs have been deferred and are being amortized over
      five years.


                                     D - 20
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97
DEFINED ASSET FUNDS

PORTFOLIO OF THE PENNSYLVANIA TRUST (INSURED)
AS OF OCTOBER 31, 2000

<TABLE>
<CAPTION>
                                        Rating                                        Optional
    Portfolio No. and Title of              of            Face                        Redemption
            Securities(4)               Issues(1)        Amount  Coupon Maturities(3) Provisions(3)            Cost      Value(2)
            _____________               _________        ______  ______ _____________ _____________            ____      ________
 <S>                                   <C>         <C>           <C>       <C>       <C>              <C>           <C>
 1 Pennsylvania Intergovernmental          AAA       $  180,000   5.600%     2015(5)    06/15/03         $  177,875    $  184,970
   Cooperation Authority, Special Tax                                                   @ 100.000
   Revenue Bonds (City of Philadelphia
   Funding Program) Ser. 1993 (MBIA
   Ins.)

 2 Pennsylvania State Higher Educl.        AAA          500,000   5.875      2025       07/15/05            503,100       505,600
   Facs. Auth., Coll. and Univ. Rev.                                                    @ 102.000
   Bonds (St. Joseph's Univ. Issue)
   (Connie Lee Ins.)

 3 Philadelphia Authority For              AAA          370,000   5.250      2017       07/01/03            349,402       362,730
   Industrial Development, PA, Project                                                  @ 102.000
   Revenue Refunding Bonds (PGH/CHDC
   Parking Facs.), Ser. 1993 (MBIA
   Ins.)

 4 School Dist. of Philadelphia, PA,       AAA          415,000   5.500      2025       09/01/05            406,036       408,339
   G.O. Rfdg. Bonds, Ser. 1995 B                                                        @ 101.000
   (AMBAC Ins.)

 5 City Philadelphia, PA, Wtr. and         AAA           60,000   5.750      2013(5)    06/15/03             60,436        62,899
   Wastewater Rev. Bonds, Ser. 1993                                                     @ 102.000
   (MBIA Ins.)                                           15,000   5.750      2013       06/15/03             15,109        15,402
                                                                                        @ 102.000

 6 Urban Redev. Auth. of Pittsburgh,    AAA             490,000   5.650      2024       10/01/03            483,100       483,650
   PA, Mtge. Rev. Bonds, 1993 Ser. A                                                    @ 102.000
   (AMBAC Ins.)

 7 Washington County Authority, PA,        AAA          170,000   5.625      2022       06/01/03            168,256       170,091
   Lease Revenue Refunding Bonds, Ser.                                                  @ 100.000
   1993 A (Financial Guaranty Ins.)
                                                   ______________                                     ______________ ______________

                                                     $2,200,000                                          $2,163,314    $2,193,681
                                                   ==============                                     ============== ==============
</TABLE>

                     See Notes to Portfolios on Page D - 22.


                                     D - 21
<PAGE>

MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES - 97 (CALIFORNIA, NEW JERSEY, NEW YORK AND PENNSYLVANIA
TRUSTS)
DEFINED ASSET FUNDS


NOTES TO PORTFOLIOS
AS OF OCTOBER 31, 2000

1) The ratings of the bonds are by Standard & Poor's Ratings
       Group, or by Moody's Investors Service, Inc. if followed by
       "(m)", or by Fitch Investors Service, Inc. if followed by
       "(f)"; "NR" indicates that this bond is not currently rated by
       any of the above-mentioned rating services. These ratings have
       been furnished by the Evaluator but not confirmed with
       the rating agencies.

   (2) See Notes to Financial Statements.

   (3) Optional redemption provisions, which may be exercised in whole
       or in part, are initially at prices of par plus a premium, then
       subsequently at prices declining to par. Certain securities may
       provide for redemption at par prior or in addition to any
       optional or mandatory redemption dates or maturity, for
       example, through the operation of a maintenance and replacement
       fund, if proceeds are not able to be used as contemplated, the
       project is condemned or sold or the project is destroyed and
       insurance proceeds are used to redeem the securities. Many of
       the securities are also subject to mandatory sinking fund
       redemption commencing on dates which may be prior to the date
       on which securities may be optionally redeemed. Sinking fund
       redemptions are at par and redeem only part of the issue. Some
       of the securities have mandatory sinking funds which contain
       optional provisions permitting the issuer to increase the
       principal amount of securities called on a mandatory redemption
       date. The sinking fund redemptions with optional provisions
       may, and optional refunding redemptions generally will, occur
       at times when the redeemed securities have an offering side
       evaluation which represents a premium over par. To the extent
       that the securities were acquired at a price higher than the
       redemption price, this will represent a loss of capital when
       compared with the Public Offering Price of the Units when
       acquired. Distributions will generally be reduced by the amount
       of the income which would otherwise have been paid with respect
       to redeemed securities and there will be distributed to Holders
       any principal amount and premium received on such redemption
       after satisfying any redemption requests for Units received by
       the Fund. The estimated current return may be affected by
       redemptions.

   (4) Insured by AAA-rated insurance companies that guarantee timely
       payments of principal and interest on the bonds (but not Fund
       units or the market value of the bonds before they mature).

   (5) Bonds with aggregate face amounts of $130,000 and $240,000 for New
       Jersey and Pennsylvania Trusts, respectively, have been pre-refunded
       and are expected to be called for redemption on the optional
       redemption provision dates shown.


                                     D - 22
<PAGE>
              Defined
            Asset Funds-Registered Trademark-

<TABLE>
<S>                                      <C>
HAVE QUESTIONS ?                         MUNICIPAL INVESTMENT TRUST FUND
Request the most                         MULTISTATE SERIES--97
recent free Information                  (A Unit Investment Trust)
Supplement that gives more               ---------------------------------------
details about the Fund,                  This Prospectus does not contain
by calling:                              complete information about the
The Bank of New York                     investment company filed with the
1-800-221-7771                           Securities and Exchange Commission in
                                         Washington, D.C. under the:
                                         - Securities Act of 1933 (file no.
                                         33-62037) and
                                         - Investment Company Act of 1940 (file
                                         no. 811-1777).
                                         TO OBTAIN COPIES AT PRESCRIBED RATES--
                                         WRITE: Public Reference Section of the
                                         Commission
                                         450 Fifth Street, N.W., Washington,
                                         D.C. 20549-6009
                                         CALL: 1-800-SEC-0330.
                                         VISIT: http://www.sec.gov.
                                         ---------------------------------------
                                         No person is authorized to give any
                                         information or representations about
                                         this Fund not contained in this
                                         Prospectus or the Information
                                         Supplement, and you should not rely on
                                         any other information.
                                         ---------------------------------------
                                         When units of this Fund are no longer
                                         available, this Prospectus may be used
                                         as a preliminary prospectus for a
                                         future series, but some of the
                                         information in this Prospectus will be
                                         changed for that series.
                                         UNITS OF ANY FUTURE SERIES MAY NOT BE
                                         SOLD NOR MAY OFFERS TO BUY BE ACCEPTED
                                         UNTIL THAT SERIES HAS BECOME EFFECTIVE
                                         WITH THE SECURITIES AND EXCHANGE
                                         COMMISSION. NO UNITS CAN BE SOLD IN ANY
                                         STATE WHERE A SALE WOULD BE ILLEGAL.
                                                                     15156--1/01
</TABLE>


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