MONTGOMERY FUNDS III
497, 1998-05-22
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                                                 Rule 497(e)
                                                 File Nos. 33-84450 and 811-8782


                            THE MONTGOMERY FUNDS III

                      Supplement dated May 22, 1998, to the

                               Prospectus for the
               Montgomery Variable Series: International Cap Fund
                              dated April 30, 1998


Effective May 22, 1998, the Montgomery Variable Series:  International Small Cap
Fund will be closed to new investors.




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