DEFINED ASSET FUNDS MUNICIPAL STATE SERIES, 485BPOS, 1996-06-05

DEFINED ASSET FUNDS MUNICIPAL STATE SERIES
485BPOS, 1996-06-05

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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 5, 1996

REGISTRATION NO. 33-58571
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SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

------------------------------------------

POST-EFFECTIVE AMENDMENT NO. 1
TO
FORM S-6

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FOR REGISTRATION UNDER THE SECURITIES ACT
OF 1933 OF SECURITIES OF UNIT INVESTMENT
TRUSTS REGISTERED ON FORM N-8B-2

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A. EXACT NAME OF TRUST:

DEFINED ASSET FUNDS--
MUNICIPAL STATE SERIES

B. NAMES OF DEPOSITORS:

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
PAINEWEBBER INCORPORATED

C. COMPLETE ADDRESSES OF DEPOSITORS' PRINCIPAL EXECUTIVE OFFICES:

MERRILL LYNCH, PIERCE,
FENNER & SMITH
INCORPORATED
DEFINED ASSET FUNDS
POST OFFICE BOX 9051
PRINCETON, N.J.
08543-9051 PAINEWEBBER INCORPORATED
1285 AVENUE OF THE
AMERICAS
NEW YORK, N.Y. 10019

D. NAMES AND COMPLETE ADDRESSES OF AGENTS FOR SERVICE:

TERESA KONCICK, ESQ. ROBERT E. HOLLEY COPIES TO:
P.O. BOX 9051 1200 HARBOR BLVD. PIERRE DE SAINT PHALLE,
PRINCETON, N.J. WEEHAWKEN, N.J. 07087 ESQ.
08543-9051 450 LEXINGTON AVENUE
NEW YORK, N.Y. 10017

The issuer has registered an indefinite number of Units under the Securities Act
of 1933 pursuant to Rule 24f-2 and filed the Rule 24f-2 Notice for the most
recent fiscal year on February 7, 1996.

Check box if it is proposed that this filing will become effective on June 14,
1996 pursuant to paragraph (b) of Rule 485. / x /

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<PAGE>
<PAGE>
DEFINED ASSET FUNDSSM
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MUNICIPAL STATE This Defined Fund consists of fixed portfolios of
SERIES long-term bonds issued by a single state and its
(UNIT INVESTMENT local governments and authorities or by certain
TRUSTS) U.S. territories or possessions. Each Portfolio is
- ------------------------------formed to provide interest income which in the
/ / DESIGNED FOR DOUBLE opinion of counsel is, with certain exceptions,
TAX-FREE INCOME exempt from Federal income taxes and from certain
/ / DEFINED PORTFOLIOS OF state and local taxes of the State for which the
MUNICIPAL BONDS Portfolio is named but may be subject to other
/ / MONTHLY INCOME state and local taxes. There is no assurance that
CALIFORNIA INSURED SERIES this objective will be met because it is subject
PENNSYLVANIA INSURED SERIES to the continuing ability of issuers of the bonds
to meet their principal and interest requirements.
Furthermore, the market value of the bonds, and
therefore the value of the Units, will fluctuate
with changes in interest rates and other factors.
Each Portfolio is insured. This insurance
guarantees the timely payment of principal and
interest on but does not guarantee the market
value of the bonds or the value of the Units.
Minimum Purchase: One Unit

-------------------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR
DISAPPROVED BY THE SECURITIES AND EXCHANGE
COMMISSION OR ANY STATE SECURITIES COMMISSION NOR
HAS THE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS DOCUMENT. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
-------------------------------------------------
PART A OF THIS PROSPECTUS MAY NOT BE DISTRIBUTED
UNLESS ACCOMPANIED BY DEFINED ASSET FUNDS
MUNICIPAL SERIES PROSPECTUS PART B.
INVESTORS SHOULD READ BOTH PARTS OF THIS
SPONSORS: PROSPECTUS CAREFULLY AND RETAIN THEM FOR FUTURE
Merrill Lynch, REFERENCE.
Pierce, Fenner & Smith INQUIRIES SHOULD BE DIRECTED TO THE TRUSTEE AT
Incorporated 1-800-323-1508.
PaineWebber Incorporated PROSPECTUS PART A DATED JUNE 14, 1996.

<PAGE>
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Def ined Asset FundsSM
Defined Asset Funds is America's oldest and largest family of unit investment
trusts, with over $100 billion sponsored since over the last 25 years. Each
Defined Asset Fund is a portfolio of preselected securities. Each portfolio is
divided into 'units' representing equal shares of the underlying assets. Each
unit receives an equal share of income and principal distributions.

Defined Asset Funds offer several defined 'distinctives'. You know in advance
what you are investing in and that changes in the portfolio are limited - a
defined portfolio. Most defined bond funds pay interest monthly - defined
income. The portfolio offers a convenient and simple way to invest - simplicity
defined.

Your financial professional can help you select a Defined Asset Fund to meet
your personal investment objectives. Our size and market presence enable us to
offer a wide variety of investments. The Defined Asset Funds family offers:

o Municipal portfolios
o Corporate portfolios
o Government portfolios
o Equity portfolios
o International portfolios

The terms of Defined Funds are as short as one year or as long as 30 years.
Special defined funds are available including: insured funds, double and triple
tax-free funds and funds with 'laddered maturities' to help protect against
changing interest rates. Defined Asset Funds are offered by prospectus only.
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Defined Municipal State Series
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Our defined portfolios of municipal bonds offer you a simple and convenient way
to earn tax-free monthly income. And by purchasing Defined Asset Funds, you not
only receive professional selection but also gain the advantage of reduced risk
by investing in bonds of several different issuers.

INVESTMENT OBJECTIVE

To provide interest income exempt from regular federal income taxes through
investment in a fixed portfolio consisting primarily of municipal bonds issued
by or on behalf of a single state and its local governments and authorities.
Units may also be exempt from certain state and local taxes for residents of the
State.

DIVERSIFICATION

Each Portfolio contains a number of different bond issues. Spreading your
investment among different issuers reduces your risk, but does not eliminate it,
especially since each Portfolio contains bonds of only one State. Because of
maturities, sales or other dispositions of bonds, the size, composition and
return of the Portfolio will change over time. The information in this
prospectus is as of March 31, 1996, the evaluation date.
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Defining Your Portfolio
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PROFESSIONAL SELECTION AND SUPERVISION

Both Portfolios contain a variety of bonds selected by experienced buyers and
research analysts. The Fund is not actively managed; however, it is regularly
reviewed and a bond can be sold if retaining it is considered detrimental to
investors' interests.

MONTHLY FEDERALLY TAX-FREE INTEREST INCOME

Both Portfolios pay monthly income, even though the bonds generally pay interest
semi-annually.

INSURANCE

The bonds included in the Portfolios are insured. This insurance guarantees the
timely payment of principal of and interest on the bonds, but does not guarantee
the value of the bonds or the units. Insurance may not cover accelerated
payments of principal or any increase in interest payments or premiums payable
on mandatory redemptions, including if interest on a bond is determined to be
taxable. (See Bonds Backed by Letters of Credit or Insurance in Part B).

BOND CALL FEATURES

It is possible that during periods of falling interest rates, a bond with a
coupon higher than current market rates will be prepaid or 'called', at the
option of the bond issuer, before its expected maturity. When bonds are
initially callable, the price is usually at a premium to par which then declines
to par over time. Bonds may also be subject to a mandatory sinking fund or have
extraordinary redemption provisions. For example, if the bond's proceeds are not
able to be used as intended the bond may be redeemed. This redemption and the
sinking fund are often at par.

A-2
<PAGE>
CALL PROTECTION

Although many bonds are subject to optional refunding or call provisions, we
selected bonds with call protection. This call protection means that any bond in
a Portfolio generally cannot be called for a number of years after the initial
date of deposit (which was April 27, 1995) and thereafter at a declining premium
over par.

TAX INFORMATION

Based on the opinion of bond counsel, income from the bonds held by this Fund is
generally 100% exempt under existing laws from regular federal income tax and
certain state and local personal income taxes for residents of a particular
State. Any gain on a disposition of the underlying bonds or units will be
subject to tax.
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Defining Your Investment
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PUBLIC OFFERING PRICE

The Public Offering Price as of the evaluation date, is based on the aggregate
bid side value of the underlying bonds in the Portfolio, divided by the number
of units outstanding, plus a sales charge. The Public Offering Price on any
subsequent date will vary. An amount equal to principal cash, if any, as well as
net accrued but undistributed interest on the unit is added to the Public
Offering Price. Units are also subject to periodic deferred sales charges. The
underlying bonds are evaluated by an independent evaluator at 3:30 p.m. Eastern
time on every business day.

REINVESTMENT OPTION

You can elect to automatically reinvest your distributions into a separate
portfolio of federally tax-exempt bonds. Most or all of the bonds in that
portfolio, however, will not be insured or exempt from state and local taxes.
Reinvesting helps to compound your income free of federal income taxes.

PRINCIPAL DISTRIBUTIONS

Principal from sales, redemptions and maturities of bonds in each Trust will be
distributed to investors periodically when the amount to be distributed is more
than $5.00 per unit.

SELLING YOUR INVESTMENT

You may sell your units at any time. Your price is based on the then current net
asset value of the Portfolio (based on the lower bid side evaluation of the
bonds, as determined by an independent evaluator), plus principal cash, if any,
as well as accrued interest. If you sell your units before the fourth
anniversary of the Portfolio, you will pay a contingent deferred sales charge of
$15 per unit if sold in the second year, $10 per unit if sold in the third year
and $5 per unit if sold in the fourth year.
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Defining Your Risks
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RISK FACTORS

Unit price fluctuates and could be adversely affected by increasing interest
rates as well as the financial condition of the issuers of the bonds and any
insurance companies backing certain of the bonds. Because of the possible
maturity, sale or other disposition of securities, the size, composition and
return of the portfolio may change at any time. Because of the sales charges,
returns of principal and fluctuations in unit price, among other reasons, the
sale price will generally be less than the cost of your units. Unit prices could
also be adversely affected if a limited trading market exists in any security to
be sold. There is no guarantee that the Fund will achieve its investment
objective.

In addition, each Portfolio has fewer bond issues than a national fund, and is
concentrated in bonds of issuers located in only one State. There may be
additional risk from decreased diversification as well as from factors
particular to that State.

A-3
<PAGE>

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Defined California Insured Series
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PORTFOLIO DIVERSIFICATION

The Portfolio contains 7 California bonds.

TYPES OF BONDS

The Portfolio consists of municipal revenue bonds of the following types:

APPROXIMATE
PORTFOLIO
PERCENTAGE
/ / General Obligation 15%
/ / Hospitals/Health Care Facilities 15%
/ / Lease Rental Appropriation 15%
/ / Municipal Water/Sewer Utilities 25%
/ / State/Local Municipal Electric
Utilities 16%
/ / Universities/Colleges 14%

INSURANCE

The approximate percentage of the aggregate face amount of the Portfolio insured
by each insurance company is:

AMBAC Indemnity Corporation 30%
Connie Lee Insurance Company 14%
Financial Guaranty Insurance Company 25%
MBIA Insurance Corporation 31%

RISK FACTORS

The Portfolio is concentrated in Municipal Water/Sewer Utility bonds and is
therefore dependent to a significant degree on revenues generated from those
particular activities. (See Risk Factors in Part B.) The Portfolio is also
concentrated in bonds of California issuers and is subject to additional risk
from decreased diversification as well as from factors that may be particular to
California, which are briefly described on the following pages.

PREMIUM AND DISCOUNT ISSUES

On the evaluation date, 30% of the bonds were valued at a premium over par and
70% at a discount from par (see Risk Factors in Part B).

TERMINATION DATE

The Portfolio will generally terminate no later than the maturity date of the
last maturing bond listed in the Portfolio. The Portfolio may be terminated if
the value is less than 40% of the face amount of bonds deposited. On the
evaluation date the value of the Portfolio was 95% of the face amount of bonds
deposited.

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Defining Your Income
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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: $ 4.50
Annual Income per unit: $ 54.01

These figures are estimates determined as of the evaluation date and actual
payments may vary.
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Defining Your Costs
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PUBLIC OFFERING PRICE PER UNIT $1,013.29

The Public Offering Price as of March 31, 1996, the evaluation date, is based on
the aggregate bid side value of the bonds ($5,755,272), plus cash ($60,834),
divided by the number of units outstanding (5,803), plus an up-front sales
charge of 1.10% of the Public Offering Price (1.112% of the value of the
underlying bonds). An amount equal to any additional principal cash as well as
net accrued but undistributed interest on the unit is added to the Public
Offering Price. Units are also subject to periodic deferred sales charges (see
Sales Charge below).

The per unit bid side redemption and secondary market repurchase price as of the
evaluation date was $1,002.26 ($11.03 less than the Public Offering Price).

SALES CHARGE

In the first four years of owning the Portfolio you will pay $11 per unit each
year ($2.75 quarterly), a total of $44. This sales charge will be paid from
interest on bonds normally reserved for that purpose and periodic sale of bonds.
Interest on the reserved bonds accrues to you and is not included in the
Portfolio's return figures.

ESTIMATED ANNUAL FUND OPERATING EXPENSES

Per Unit
--------------
Trustee's Fee $ 0.72
Maximum Portfolio Supervision and Bookkeeping
Fees $ 0.41
Evaluator's Fee $ 0.22
Other Operating Expenses $ 0.41
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TOTAL $ 1.76

A-4
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California Taxes and Risks
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CALIFORNIA RISK FACTORS

The State of California continues to confront budgetary concerns. State
expenditures in recent years have exceeded projected amounts mainly because of
increased health and welfare caseloads, lower property taxes (requiring State
support for certain education expenses), lower than expected federal government
payments for immigration related costs, significant additional costs associated
with the construction and operation of correctional institutions and
extraordinary expenditures related to the January 1994 Los Angeles earthquake
and the recent severe flooding in various parts of the State. Also, in December
1994, Orange County, California and its Investment Pool filed for bankruptcy in
connection with substantial losses experienced by the Pool. The County has since
defaulted on certain of its obligations and substantial budget deficits may be
experienced by the County and other public agencies which participate in the
Pool. The ultimate financial impact of these events upon the County and other
Pool investors and the State of California, generally, or the liquidity or value
of their securities, cannot be predicted.

To balance the budget, the Governor of California has proposed, among other
things, a series of revenue shifts from local government, reliance on increased
federal aid and reductions in state spending. Major adjustments reflected in
recent budgets include a shift in property taxes from cities, counties, special
districts and redevelopment agencies to school and community college districts,
severe reductions in support for health and welfare programs and higher
education, and various other cuts in services, suspensions of tax credits and
payment deferrals.

Certain California constitutional amendments, legislative measures,
executive orders, administrative regulations and voter initiatives could have
adverse effects on the California economy. Among these are measures that have
established tax, spending or appropriations limits and prohibited the imposition
of certain new taxes, authorized the transfers of tax liabilities and
reallocations of tax receipts among governmental entities and provided for
minimum levels of funding.

Certain bonds in the Trust may be subject to provisions of California law
that could adversely affect payments on those bonds or limit the remedies
available to bondholders. Among these are bonds of health care 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
beneficiaries, and bonds secured by liens on real property.

General obligation bonds of the State of California are currently rated A1
by Moody's and A by Standard & Poor's.

CALIFORNIA TAXES

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

The Trust is neither a business trust nor an association taxable as a
corporation for California tax purposes. Each holder will be considered the
owner of a pro rata portion of the Trust Fund and will be deemed to receive his
pro rata portion of the income therefrom. To the extent interest on the Debt
Obligations is exempt from California personal income taxes, said interest is
similarly exempt from California personal income taxes in the hands of the
holders, except to the extent such holders are banks or corporations subject to
the California franchise tax. Holders will be subject to California income tax
on any gain on the disposition of all or part of his pro rata portion of a Debt
Obligation in the Trust Fund. A holder will be considered to have disposed of
all or part of his pro rata portion of each Debt Obligation when he sells or
redeems all or some of his Units. A holder will also be considered to have
disposed of all or part of his pro rata portion of a Debt Obligation when all or
part of the Debt Obligation is sold by the Trust Fund or is redeemed or paid at
maturity. The Debt Obligations and the Units are not taxable under the
California personal property tax law.

A-5
<PAGE>

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Defined Pennsylvania Insured Series
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PORTFOLIO DIVERSIFICATION

The Portfolio contains 7 Pennsylvania bonds.

TYPES OF BONDS

The Portfolio consists of municipal bonds of the following types:

APPROXIMATE
PORTFOLIO
PERCENTAGE
/ / Hospitals/Health Care Facilities 40%
/ / Parking Authority 15%
/ / Municipal Water/Sewer Utilities 30%
/ / Special Tax 15%

INSURANCE

The approximate percentage of the aggregate face amount of the Portfolio insured
by each insurance company is:

AMBAC Indemnity Corporation 25%
Connie Lee Insurance Company 15%
Financial Guaranty Insurance Company 30%
MBIA Insurance Corporation 30%

RISK FACTORS

The Portfolio is concentrated in Hospital/Health Care Facility bonds and
Municipal Water/Sewer Utility bonds and is therefore dependent to a significant
degree on revenues generated from those particular activities. (See Risk Factors
in Part B.) The Portfolio is also concentrated in bonds of Pennsylvania issuers
and is subject to additional risk from decreased diversification as well as from
factors that may be particular to Pennsylvania, which are briefly described on
the following pages.

PREMIUM AND DISCOUNT ISSUES

On the evaluation date, 30% of the bonds were valued at a premium over par and
70% at a discount from par (see Risk Factors in Part B).

TERMINATION DATE
The Portfolio will generally terminate no later than the maturity date of the
last maturing bond listed in the Portfolio. The Portfolio may be terminated if
the value is less than 40% of the face amount of bonds deposited. On the
evaluation date the value of the Portfolio was 96% of the face amount of bonds
deposited.

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Defining Your Income
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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: $ 4.47
Annual Income per unit: $ 53.71

PUBLIC OFFERING PRICE PER UNIT $1,013.80

The Public Offering Price as of March 31, 1996, the evaluation date, is based on
the aggregate bid side value of the bonds ($4,838,734), plus cash ($51,739),
divided by the number of units outstanding (4,877), plus an up-front sales
charge of 1.10% of the Public Offering Price (1.112% of the value of the
underlying bonds). An amount equal to any additional principal cash as well as
net accrued but undistributed interest on the unit is added to the Public
Offering Price. Units are also subject to periodic deferred sales charges (see
Sales Charge below).

The per unit bid side redemption and secondary market repurchase price as of the
evaluation date was $1,002.76 ($11.04 less than the Public Offering Price).

SALES CHARGE

ESTIMATED ANNUAL FUND OPERATING EXPENSES

Per Unit
---------------
Trustee's Fee $ 0.71
Maximum Portfolio Supervision and Bookkeeping
Fees $ 0.46
Evaluator's Fee $ 0.26
Other Operating Expenses $ 0.48
---------------
TOTAL $ 1.91

A-6
<PAGE>
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Pennsylvania Taxes and Risks
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PENNSYLVANIA RISK FACTORS

The Commonwealth of Pennsylvania and certain of its municipal subdivisions,
including the City of Philadelphia, have undergone the financial difficulties
and pressures that accompany a decline in economic conditions. As the heavy
industries historically associated with Pennsylvania -- e.g., coal, steel and
railroad -- have declined with increasing competition from foreign producers,
the services sector, including trade, medical and health services, education and
financial institutions, has provided major new sources of growth. Agriculture
and related industries continue to be an important part of Pennsylvania's
economy.

Both the Commonwealth of Pennsylvania and the City of Philadelphia have
historically experienced significant revenue shortfalls. On the other hand,
rising demands on state programs, particularly for medical assistance and cash
assistance programs, and the increased cost of special education programs and
correction facilities and programs, have contributed to increased expenditures.
In response, the Commonwealth and the City of Philadelphia have, in recent
years, sought to balance budgets with a combination of tax increases and
expenditure restraints.

To deal with its budget deficits, Philadelphia has considered significant
service cuts and a plan to privatize certain city-provided services. In
addition, in 1991 the Commonwealth created the Pennsylvania Inter-Governmental
Cooperation Authority ('PICA'), with authority to issue notes and bonds on
behalf of Philadelphia to cover budget shortfalls, to eliminate projected
deficits and to fund capital spending. PICA has issued approximately $1.4
billion of Special Revenue Bonds on behalf of the City. However, its power to
issue bonds for the most purposes expired on December 31, 1994 and its power to
issue bonds to finance a cash flow deficit will expire on December 31, 1996.
PICA's authority to refund existing debt will not expire.

Although there can be no assurance that such conditions will continue, the
Commonwealth's general obligation bonds are currently rated AA-by Standard &
Poor's and A1 by Moody's, while Philadelphia's general obligation bonds are
rated BBB-and Baa by Standard & Poor's and Moody's, respectively.

PENNSYLVANIA TAXES

The following summarizes the opinion of Drinker Biddle & Reath,
Philadelphia, Pennsylvania, special counsel on Pennsylvania tax matters, under
existing law:

1. The Fund will be recognized as a trust and will not be taxable as a
corporation for Pennsylvania state and local tax purposes.

2. Units of the Fund are not subject to the County Personal Property Tax
presently in effect in Pennsylvania to the extent of that proportion of the Fund
represented by bonds issued by the Commonwealth of Pennsylvania, its agencies
and instrumentalities, or by any county, city, borough, twown, township, school
district, municipality or local housing or parking authority in the Commonwealth
of Pennsylvania ('Pennsylvania Obligations'). Fund Units may be taxable under
the Pennsylvania inheritance and estate taxes.

3. Distributions to investors in the Fund attributable to interest from
Pennsylvania Obligations are not taxable under the Pennsylvania Personal Income
Tax or under the Corporate Net Income Tax imposed on corporations by Article IV
of the Pennsylvania Tax Reform Code, nor are such distributions taxable under
the Philadelphia School District Investment Income Tax imposed on Philadelphia
resident individuals.

4. Although there is no published authority on the subject, counsel is of
the opinion that any insurance proceeds paid in lieu of interest on defaulted
tax-exempt bonds will be exempt from the Pennsylvania Personal Income Tax either
as payment in lieu of tax-exempt interest or as payments of insurance proceeds
which are not included in any of the classes of income specified as taxable
under the Pennsylvania Personal Income Tax Law. Further, because such insurance
proceeds are excluded from the Federal income tax base, such proceeds will not
bee subject to the Pennsylvania Corporate Net Income Tax. Proceeds from
insurance policies are expressly excluded from the Philadelphia School District
Investment Income Tax and, accordingly, insurance proceeds paid to replace
defaulted payments under any bonds will not be subject to that tax.

5. Distributions to investors in the Fund attributable to gain on the
disposition by the Fund of Pennsylvania Obligations (whether by sale, redemption
or payment at maturity) will be taxable under the Pennsylvania Personal Income
Tax, the Pennsylvania Corporate Income Tax, and, unless the obligation has been
held for more than six months, the Philadelphia School District Investment
Income Tax. Distributions attributable to gain on the disposition of any
obligation held more than six months will not be subject to the Philadelphia
School District Investment Income Tax.

6. To the extent the value of Units is represented by obligations of the
Commonwealth of Puerto Rico or obligations of the territory of Guam, such value
will not be subject to the Pennsylvania County Personal Property Tax to the
extent required by Federal statutes. Distributions to investors in the Fund
attributable to interest on such obligations is not taxable under any of the
Pennsylvania State and local income taxes referred to above. Distributions to
investors in the Fund attributable to gain on the disposition of such
obligations will be taxable under the Pennsylvania State and local income taxes
referred to above, except that gain on any obligation held for more than six
months is not subject to the Philadelphia School District Investment Income Tax.

7. Gain on the disposition of a Unit will be taxable under the Pennsylvania
Personal Income Tax, the Pennsylvania Corporate Income Tax, and, unless the Unit
has been held for more than six months, the Philadelphia School District
Investment Income tax. Gain on the disposition of a Unit held more than six
monthls will not be subject to the Philadelphia School District Investment
Income Tax.

A-7
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<TABLE><CAPTION>
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TAX-FREE VS. TAXABLE INCOME: A COMPARISON OF TAXABLE AND TAX-FREE YIELDS

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

COMBINED
EFFECTIVE
TAXABLE INCOME 1996* 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- 24,000 $ 0- 40,100 20.10 5.01 5.63 6.26 6.88 7.51 8.14 8.76 9.39 10.01
$ 24,000- 58,150 $ 40,100- 96,900 34.70 6.13 6.89 7.66 8.42 9.19 9.95 10.72 11.48 12.25
$ 58,150-121,300 $ 96,900-147,700 37.42 6.39 7.19 7.99 8.79 9.59 10.39 11.19 11.98 12.78
$121,300-263,750 $147,700-263,750 41.95 6.89 7.75 8.61 9.47 10.34 11.20 12.06 12.92 13.78
OVER $263,750 OVER $263,750 45.22 7.30 8.21 9.13 10.04 10.95 11.87 12.78 13.69 14.60

<CAPTION>
FOR PENNSYLVANIA RESIDENTS
- --------------------------------------------------------------------------------
COMBINED
EFFECTIVE TAX-FREE YIELD
TAXABLE INCOME 1996* TAX RATE 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- 24,000 $ 0- 40,100 17.38 4.84 5.45 6.05 6.66 7.26 7.87 8.47 9.08 9.68
$ 24,000- 58,150 $ 40,100- 96,900 30.02 5.72 6.43 7.14 7.86 8.57 9.29 10.00 10.72 11.43
$ 58,150-121,300 $ 96,900-147,700 32.93 5.96 6.71 7.46 8.20 8.95 9.69 10.44 11.18 11.93
$121,300-263,750 $147,700-263,750 37.79 6.43 7.23 8.04 8.84 9.65 10.45 11.25 12.06 12.86
OVER $263,750 OVER $263,750 41.29 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 1996
federal and applicable State 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.

A-8

<PAGE>
DEFINED ASSET FUNDS - MUNICIPAL STATE SERIES
CALIFORNIA INSURED SERIES
PENNSYLVANIA INSURED SERIES

REPORT OF INDEPENDENT ACCOUNTANTS

The Sponsors, Trustee and Holders
of Defined Asset Funds - Municipal State Series:

We have audited the accompanying statements of condition of Defined Asset Funds
- - Municipal State Series, including the portfolios, as of March 31, 1996 and the
related statements of operations and of changes in net assets for the period
April 27, 1995 to March 31, 1996. 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 generally accepted auditing
standards. 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
March 31, 1996, as shown in such portfolio, were confirmed to us by The Chase
Manhattan Bank (National Association), 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 Defined Asset Funds, Municipal
State Series at March 31, 1996 and the results of its operations and changes in
its net assets for the above-stated periods in conformity with generally
accepted accounting principles.

DELOITTE & TOUCHE LLP

New York, NY
May 20, 1996

D-1

<PAGE>
DEFINED ASSET FUNDS - MUNICIPAL STATE SERIES
CALIFORNIA INSURED SERIES

STATEMENT OF CONDITION
AS OF MARCH 31, 1996

<TABLE>

<S> <C>
TRUST PROPERTY:
Investment in marketable securities
at value (cost $5,708,221) (Note 1) $5,755,272
Accrued interest 84,235
Accrued interest on segmented bond (Note 5) 5,147
Cash - principal 60,834

Total trust property 5,905,488

LESS LIABILITIES:
Income advance from Trustee $ 65,354
Other advance from Trustee 2,622
Accrued Sponsor's fees 596 68,572

NET ASSETS, REPRESENTED BY:
5,803 units of fractional undivided
interest outstanding (Note 3) 5,818,631
Undistributed net investment income 18,285 $5,836,916

UNIT VALUE ($5,836,916 / 5,803 units) $1,005.84

See Notes to Financial Statements.

</TABLE>

D-2

<PAGE>
DEFINED ASSET FUNDS - MUNICIPAL STATE SERIES
CALIFORNIA INSURED SERIES

STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
April 27,
1995 to
March 31,
1996

<S> <C>
INVESTMENT INCOME:
Interest income $300,294
Interest income from segmented bonds (Note 5) 17,255
Trustee's fees and expenses (7,282)
Sponsors' fees (2,216)

Net investment income 308,051

REALIZED GAIN ON INVESTMENTS:
Realized loss on securities sold (426)
Unrealized appreciation of investments 47,051

Net realized and unrealized gain on investments 46,625

NET INCREASE IN ASSETS RESULTING FROM OPERATIONS $354,676

</TABLE>
See Notes to Financial Statements.

D-3

<PAGE>
DEFINED ASSET FUNDS - MUNICIPAL STATE SERIES
CALIFORNIA INSURED SERIES

STATEMENT OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
April 27,
1995 to
March 31,
1996

<S> <C>
OPERATIONS:
Net investment income $ 308,051
Realized loss on securities sold (426)
Unrealized appreciation on investments 47,051

Net increase in net assets resulting from operations 354,676

INCOME DISTRIBUTIONS TO HOLDERS (Note 2) (266,416)

SHARE TRANSACTIONS (Note 5):
Deferred sales charge:
Income (20,825)
Principal (27,049)

Total share transactions (47,874)

NET INCREASE IN NET ASSETS 40,386

NET ASSETS AT BEGINNING OF PERIOD 5,796,530

NET ASSETS AT END OF PERIOD $5,836,916

PER UNIT:
Income distributions during period $45.91

Net asset value at end of period $1,005.84

TRUST UNITS OUTSTANDING AT END OF PERIOD 5,803
</TABLE>

See Notes to Financial Statements.

D-4

<PAGE>
DEFINED ASSET FUNDS - MUNICIPAL STATE SERIES
CALIFORNIA INSURED SERIES

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 generally
accepted accounting principles.

(a) Securities are stated at value as determined by the Evaluator based on
bid side evaluations for the securities (See "How to Sell Units -

Trustee's Redemption of Units" in this Prospectus, Part B), except
that value on April 27, 1995 was based upon offering side evaluations
on that date. Cost of securities at April 27, 1995 was also based on
such offering side evaluations.

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

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 distributed as explained in "Income, Distributions
and Reinvestment -Distributions" in this Prospectus, Part B.

3. NET CAPITAL

Cost of 5,803 units at Date of Deposit $5,796,530
Transfer to capital of interest on segmented bonds 17,255
Transfer to capital of interest 6,095
Net amount applicable to Holders 5,819,880
Deferred sales charge (47,874)
Realized loss on securities sold (426)
Unrealized appreciation of investments 47,051

Net capital applicable to Holders $5,818,631

4. INCOME TAXES

As of March 31, 1996, unrealized appreciation of investments, based on cost
for Federal income tax purposes, aggregated $47,051, all of which related
to appreciated securities. The cost of investment securities for Federal
income tax purposes was $5,708,221 at March 31, 1996.

D-5

<PAGE>
DEFINED ASSET FUNDS - MUNICIPAL STATE SERIES
CALIFORNIA INSURED SERIES

NOTES TO FINANCIAL STATEMENTS

5. DEFERRED SALES CHARGE

Interest on $291,325 face amount of the City of Oakland, Alameda Cnty., CA,
Gen. Oblig. Bonds, Ser. 1992, is being used to pay a portion of the Fund's

deferred sales charges. The remainder of the sales charges are being paid
for by periodic sales of these bonds. A deferred sales charge of $2.75 per
Unit is paid quarterly by the Trustee on behalf of the Unitholders up to an
aggregate of $55 per Unit over the first five years of the life of the
Fund. Should a Unitholder redeem Units prior to the end of the fourth
anniversary of the Fund, a contingent deferred sales charge of $25, $15,
$10 or $5 per Unit will be charged in the first, second, third or fourth
year of the Fund, respectively, and is included with principal redemption
amounts in the accompanying financial statements.

D-6

<PAGE>
DEFINED ASSET FUNDS - MUNICIPAL STATE SERIES
CALIFORNIA INSURED SERIES

PORTFOLIO

AS OF MARCH 31, 1996
<TABLE>
<CAPTION>

Optional
Portfolio No. and Title of Rating of Face Redemptions
Securities Issues (1)(4) Amount Coupon Maturities(3) Provisions(3) Cost(2) Value(2)

<S> <C> <C> <C> <C> <C> <C> <C>
1 California Educl. Fac. Auth., Rfdg. AAA $ 850,000 5.75% 2018 6/1/05@102 $ 808,299 $ 812,133
Rev. Bonds (College of Osteopathic
Medicine of the Pacific), Ser. 1995
(Connie Lee Ins.)

2 California Hlth. Fac. Fin. Auth., AAA 900,000 6.125 2022 8/1/02@102 901,467 908,973
Ins. Hosp. Rev. Bonds (San Diego
Hosp. Assoc.), Ser. 1992B (MBIA Ins.)

3. Department of Wtr. And Pwr. Of the AAA 610,000 6.00 2032 7/15/02@102 600,996 607,249
City of Los Angeles, CA, Wtr. Works
Rev. Bonds, Second Iss. Of 1992
(Financial Guaranty Ins.)

4. Lynwood Pub. Fin. Auth., CA, Rev. AAA 900,000 5.75 2018 9/1/03@102 871,848 878,913
1993 Ser. A (AMBAC Ins.)

5. City of Oakland, Alameda Cnty., CA, AAA 870,000 6.00 2022 6/15/02@102 864,154 870,461
Gen. Oblig. Bonds, Ser. 1992
(Financial Guaranty Ins.)

6. Sacramento Muni. Util. Dist., CA, AAA 940,000 5.25 2020 11/15/03@102 848,406 858,831
Elec. Rev. Rfdg. Bonds, 1993 Ser. D
(MBIA Ins.)

7. Public Fac. Fin. Auth. of the City AAA 900,000 5.25 2020 5/15/03@102 813,051 818,712
of San Diego, CA, Swr. Rev. Bonds,
Ser. 1993 (AMBAC Ins.)

$5,970,000 $5,708,221 $5,755,272

</TABLE>
See Note 1 to Financial Statements.

D-7

<PAGE>
DEFINED ASSET FUNDS - MUNICIPAL STATE SERIES
PENNSYLVANIA INSURED SERIES

STATEMENT OF CONDITION

AS OF MARCH 31, 1996

<TABLE>
<S> <C> <C>
TRUST PROPERTY
Investment in marketable securities
at value (cost $4,796,968) (Note 1) $4,838,734
Accrued interest 67,209
Accrued interest on Segmented Bond (Note 5) 6,171
Prepaid trustee fees and expenses 590
Cash - principal 51,739

Total trust property 4,964,443

LESS LIABILITIES:
Income advance from Trustee $ 51,825
Other advance from Trustee 4,032
Accrued sponsor's fees 558 56,415

NET ASSETS, REPRESENTED BY:
4,877 units of fractional undivided
interest outstanding (Note 3) 4,892,612
Undistributed net investment income 15,416 $4,908,028

UNIT VALUE ($4,908,028 / 4,877 units) $1,006.36

</TABLE>
See Notes to Financial Statements.

D-8

<PAGE>
DEFINED ASSET FUNDS - MUNICIPAL STATE SERIES
PENNSYLVANIA INSURED SERIES

STATEMENTS OF OPERATIONS

<TABLE><CAPTION>
April 27,
1995 to
March 31,
1996
<S> <C>
INVESTMENT INCOME
Interest income $248,013
Interest income from segmented bonds (Note 5) 14,466
Trustee's fees and expenses (2,758)
Sponsors' fees (2,075)

Net investment income 257,646

REALIZED GAIN ON INVESTMENTS:
Realized loss on securities sold (248)
Unrealized appreciation of investments 41,766

Net realized and unrealized gain on investments 41,518

NET INCREASE IN ASSETS RESULTING FROM OPERATIONS $299,164

</TABLE>
See Notes to Financial Statements.

D-9

<PAGE>
DEFINED ASSET FUNDS - MUNICIPAL STATE SERIES
PENNSYLVANIA INSURED SERIES

STATEMENTS OF CHANGES IN NET ASSETS

<TABLE><CAPTION>
April 27,
1995 to
March 31,
1996
<S> <C>
OPERATIONS:
Net investment income $ 257,646
Realized loss on securities sold (248)
Unrealized appreciation on investments 41,766

Net increase in net assets resulting from operations 299,164

INCOME DISTRIBUTIONS TO HOLDERS (Note 2) (222,489)

SHARE TRANSACTIONS (Note 5):
Deferred sales charge:
Income (17,602)
Principal (22,634)

Total share transactions (40,236)

NET INCREASE IN NET ASSETS 36,439

NET ASSETS AT BEGINNING OF PERIOD 4,871,589

NET ASSETS AT END OF PERIOD $4,908,028

PER UNIT:
Income distributions during period $45.62

Net asset value at end of period $1,006.36

TRUST UNITS OUTSTANDING AT END OF PERIOD 4,877

</TABLE>
See Notes to Financial Statements.

D-10

<PAGE>

DEFINED ASSET FUNDS - MUNICIPAL STATE SERIES
PENNSYLVANIA INSURED SERIES

NOTES TO FINANCIAL STATEMENTS

1. SIGNIFICANT ACCOUNTING POLICIES

(a) Securities are stated at value as determined by the Evaluator based on
bid side evaluations for the securities (See "How to Sell Units -
Trustee's Redemption of Units" in this Prospectus, Part B), except
that Value on April 27, 1995 was based upon offering side evaluations
on that date. Cost of securities at April 27, 1995 was also based on
such offering side evaluations.

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

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 as explained in "Income,
Distributions and Reinvestment -Distributions" in this Prospectus, Part B.

3. NET CAPITAL

Cost of 4,877 units at Date of Deposit $4,871,589
Transfer to capital of interest on segmented bonds 14,648
Transfer to capital of interest 5,093
Net amount applicable to Holders 4,891,330
Deferred sales charge (40,236)
Realized loss on securities sold (248)
Unrealized appreciation of investments 41,766

Net capital applicable to Holders $4,892,612

4. INCOME TAXES

As of March 31, 1996, unrealized appreciation of investments, based on cost
for Federal income tax purposed, aggregated $41,766, all of which related
to appreciated securities. The cost of investment securities for Federal
income tax purposes was $4,796,968 at March 31, 1996.

D-11

<PAGE>
DEFINED ASSET FUNDS - MUNICIPAL STATE SERIES
PENNSYLVANIA INSURED SERIES

NOTES TO FINANCIAL STATEMENTS

5. DEFERRED SALES CHARGE

Interest on $238,884 face amount of the North Penn Wtr. Auth. (Montgomery
Cnty., PA), Wtr. Rev. Bonds, Ser. Of 1992 (Financial Guaranty Ins.), is
being used to pay a portion of the Fund's deferred sales charges. The
remainder of the sales charges are being paid for by periodic sales of
these bonds. A deferred sales charge of $2.75 per Unit is paid quarterly
by the Trustee on behalf of the Unitholders up to an aggregate of $55 per
Unit over the first five years of the life of the Fund. Should a
Unitholder redeem Units prior to the end of the fourth anniversary of the
Fund, a contingent deferred sales charge of $25, $15, $10 or $5 per Unit
will be charged in the first, second, third or fourth year of the Fund,
respectively, and is included with principal redemption amounts in the
accompanying financial statements.

D-12

<PAGE>
DEFINED ASSET FUNDS - MUNICIPAL STATE SERIES
PENNSYLVANIA INSURED SERIES

PORTFOLIO
AS OF MARCH 31, 1996
<TABLE>
<CAPTION>

Optional
Portfolio No. and Title of Rating of Face Redemptions
Securities Issues (1)(4) Amount Coupon Maturities(3) Provisions(3) Cost(2) Value(2)

<S> <C> <C> <C> <C> <C> <C> <C>
1 Pennsylvania Intergovernmental Coop. AAA $ 750,000 5.750% 2015 6/15/03@100 $ 732,465 $ 736,253
Auth., Spec. Tax Rev. Bonds (City of
Philadelphia Funding Prog.), Ser. of
1993 (MBIA Ins.)

2 Bucks Cnty. Ind. Dev. Auth., PA, Hosp. AAA 500,000 5.250 2021 7/1/03@102 450,750 457,550
Rev. Rfdg. Bonds (Grand View Hosp.),
Ser. A of 1993 (AMBAC Ins.)

3. Cambria Cnty. Hosp. Dev. Auth., PA, Hosp.AAA 750,000 6.375 2018 7/1/02@102 764,250 767,033
Rev. Rfdg. And Imp. Bonds (Conemaugh
Valley Mem. Hosp. Proj.), Ser. B of
1992 (Connie Lee Ins.)

4. Montgomery Cnty. Higher Educ. and Hlth. AAA 750,000 5.125 2024 6/1/04@102 660,165 669,622
Auth., PA, Hosp, Rev. Bonds (Abington
Mem. Hosp.), Ser. A of 1994 (AMBAC Ins.)

5. The Erie Parking Auth., PA, Guaranteed AAA 750,000 5.800 2020 9/1/05@100 735,300 741,277
Parking Rev. Bonds, Ser. Of 1995
(Financial Guaranty Ins.)

6. City of Philadelphia, PA, Wtr. And AAA 750,000 5.600 2018 8/1/05@102 717,083 723,105
Wastewater Rev. Bonds, Ser. 1995
(MBIA Ins.)

7. North Penn Wtr. Auth. (Montgomery Cnty., AAA 725,000 6.200 2022 11/1/02@101 736,955 743,894
PA), Wtr. Rev. Bonds, Ser. Of 1992
(Financial Guaranty Ins.)

$4,975,000 $4,796,968 $4,838,734

</TABLE>
See Note 1 to Financial Statements.

D-13

<PAGE>
DEFINED ASSET FUNDS
MUNICIPAL STATE SERIES
CALIFORNIA INSURED SERIES
PENNSYLVANIA INSURED SERIES

NOTES TO PORTFOLIO
AS OF MARCH 31, 1996

(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. See "Description of Ratings" in Part B of this
Prospectus.

(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. The tax
effect on Holders of redemptions and related distributions is described
under "Taxes" in this Prospectus, Part B.

(4) All securities are insured, either on an individual basis or by portfolio
insurance, by a municipal bond insurance company which has been assigned
"AAA" claims paying ability by Standard & Poor's. Accordingly, Standard &
Poor's has assigned a "AAA" rating to the securities. Securities covered
by portfolio insurance are rated "AAA" only as long as they remain in the
Trust. See "Risk Factors - Bonds Backed by Letters of Credit or Insurance"
in this Prospectus, Part B.

D-14

<PAGE>
DEFINED ASSET FUNDS
MUNICIPAL STATE SERIES
I want to learn more about automatic reinvestment in the Investment Accumulation
Program. Please send me information about participation in the Municipal Fund
Accumulation Program, Inc. and a current Prospectus.
My name (please
print) ________________________________________________________________________
My address (please print):
Street and Apt.
No. ___________________________________________________________________________
City, State, Zip
Code __________________________________________________________________________
This page is a self-mailer. Please complete the information above, cut along the
dotted line, fold along the lines on the reverse side, tape, and mail with the
Trustee's address displayed on the outside.
<PAGE>

BUSINESS REPLY MAIL NO POSTAGE
FIRST CLASS PERMIT NO. 644, NEW YORK, N.Y. NECESSARY
IF MAILED
POSTAGE WILL BE PAID BY ADDRESSEE IN THE
THE CHASE MANHATTAN BANK, N.A. UNITED STATES
RETAIL PROCESSING DEPARTMENT
770 BROADWAY--7th FLOOR
NEW YORK, N.Y. 10003-9598

- --------------------------------------------------------------------------------
(Fold along this line.)

- --------------------------------------------------------------------------------
(Fold along this line.)
<PAGE>

DEFINED ASSET FUNDSSM
PROSPECTUS--PART B
DEFINED ASSET FUNDS MUNICIPAL SERIES
MUNICIPAL INVESTMENT TRUST FUND
FURTHER DETAIL REGARDING ANY OF THE INFORMATION PROVIDED IN THE PROSPECTUS MAY
BE OBTAINED WITHIN FIVE DAYS BY WRITING OR CALLING THE TRUSTEE, THE ADDRESS AND
TELEPHONE NUMBER OF WHICH ARE SET FORTH ON THE BACK COVER OF PART A OF THIS
PROSPECTUS.

Index

PAGE
---------
Fund Description...................................... 1
Risk Factors.......................................... 2
How to Buy Units...................................... 8
How to Sell Units..................................... 10
Income, Distributions and Reinvestment................ 10
Fund Expenses......................................... 12
Taxes................................................. 12
Records and Reports................................... 13

PAGE
---------
Trust Indenture....................................... 14
Miscellaneous......................................... 14
Exchange Option....................................... 16
Supplemental Information.............................. 17
Appendix A--Description of Ratings.................... a-1
Appendix B--Sales Charge Schedules for Defined Asset
Funds Municipal Series................................ b-1
Appendix C--Sales Charge Schedules for Municipal
Investment Trust Fund................................. c-1

FUND DESCRIPTION

BOND PORTFOLIO SELECTION

Professional buyers and research analysts for Defined Asset Funds, with
access to extensive research, selected the Bonds for the Portfolio after
considering the Fund's investment objective as well as the quality of the Bonds
(all Bonds in the Portfolio are initially rated in the category A or better by
at least one nationally recognized rating organization or have comparable credit
characteristics), the yield and price of the Bonds compared to similar
securities, the maturities of the Bonds and the diversification of the
Portfolio. Only issues meeting these stringent criteria of the Defined Asset
Funds team of dedicated research analysts are included in the Portfolio. No
leverage or borrowing is used nor does the Portfolio contain other kinds of
securities to enhance yield. A summary of the Bonds in the Portfolio appears in
Part A of the Prospectus. In a Fund that includes multiple Trusts or Portfolios,
the word Fund should be understood to mean each individual Trust or Portfolio.

The deposit of the Bonds in the Fund on the initial date of deposit
established a proportionate relationship among the face amounts of the Bonds.
During the 90-day period following the initial date of deposit the Sponsors may
deposit additional Bonds in order to create new Units, maintaining to the extent
possible that original proportionate relationship. Deposits of additional Bonds
subsequent to the 90-day period must generally replicate exactly the
proportionate relationship among the face amounts of the Bonds at the end of the
initial 90-day period.

Yields on 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. Ratings represent opinions of the rating
organizations as to the quality of the bonds rated, based on the credit of the
issuer or any guarantor, insurer or other credit provider, but these ratings are
only general standards of quality (see Appendix A).

After the initial date of deposit, the ratings of some Bonds may be reduced
or withdrawn, or the credit characteristics of the Bonds may no longer be
comparable to bonds rated A or better. Bonds rated BBB or Baa
(the lowest investment grade rating) or lower may have speculative
characteristics, and changes in economic conditions or other circumstances are
more likely to lead to a weakened capacity to make principal and interest

1
<PAGE>
payments than is the case with higher grade bonds. Bonds rated below investment
grade or unrated bonds with similar credit characteristics are often subject to
greater market fluctuations and risk of loss of principal and income than higher
grade bonds and their value may decline precipitously in response to rising
interest rates.

Because each Defined Asset Fund is a preselected portfolio of bonds, you
know the securities, maturities, call dates and ratings before you invest. Of
course, the Portfolio will change somewhat over time, as Bonds mature, are
redeemed or are sold to meet Unit redemptions or in other limited circumstances.
Because the Portfolio is not actively managed and principal is returned as the
Bonds are disposed of, this principal should be relatively unaffected by changes
in interest rates.

BOND PORTFOLIO SUPERVISION

The Fund follows a buy and hold investment strategy in contrast to the
frequent portfolio changes of a managed fund based on economic, financial and
market analyses. The Fund may retain an issuer's bonds despite adverse financial
developments. Experienced financial analysts regularly review the Portfolio and
a Bond may be sold in certain circumstances including the occurrence of a
default in payment or other default on the Bond, a decline in the projected
income pledged for debt service on a revenue bond, institution of certain legal
proceedings, if the Bond becomes taxable or is otherwise inconsistent with the
Fund's investment objectives, a decline in the price of the Bond or the
occurrence of other market or credit factors (including advance refunding) that,
in the opinion of Defined Asset Funds research analysts, makes retention of the
Bond detrimental to the interests of investors. The Trustee must generally
reject any offer by an issuer of a Bond to exchange another security pursuant to
a refunding or refinancing plan.

The Sponsors and the Trustee are not liable for any default or defect in a
Bond. If a contract to purchase any Bond fails, the Sponsors may generally
deposit a replacement bond so long as it is a tax-exempt bond, has a fixed
maturity or disposition date substantially similar to the failed Bond and is
rated A or better by at least one nationally recognized rating organization or
has comparable credit characteristics. A replacement bond must be deposited
within 110 days after deposit of the failed contract, at a cost that does not
exceed the funds reserved for purchasing the failed Bond and at a yield to
maturity and current return substantially equivalent (considering then current
market conditions and relative creditworthiness) to those of the failed Bond, as
of the date the failed contract was deposited.

RISK FACTORS

An investment in the Fund entails certain risks, including the risk that
the value of your investment will decline with increases in interest rates.
Generally speaking, bonds with longer maturities will fluctuate in value more
than bonds with shorter maturities. In recent years there have been wide
fluctuations in interest rates and in the value of fixed-rate bonds generally.
The Sponsors cannot predict the direction or scope of any future fluctuations.

Certain of the Bonds may have been deposited at a market discount or
premium principally because their interest rates are lower or higher than
prevailing rates on comparable debt securities. The current returns of market
discount bonds are lower than comparably rated bonds selling at par because
discount bonds tend to increase in market value as they approach maturity. The
current returns of market premium bonds are higher than comparably rated bonds
selling at par because premium bonds tend to decrease in market value as they
approach maturity. Because part of the purchase price is returned through
current income payments and not at maturity, an early redemption at par of a
premium bond will result in a reduction in yield to the Fund. Market premium or
discount attributable to interest rate changes does not indicate market
confidence or lack of confidence in the issue.

Certain Bonds deposited into the Fund may have been acquired on a
when-issued or delayed delivery basis. The purchase price for these Bonds is
determined prior to their delivery to the Fund and a gain or loss may result
from fluctuations in the value of the Bonds. Additionally, in any Defined Asset
Funds Municipal Series, if the value of the Bonds reserved for payment of the
periodic deferred sales charge, together with the interest thereon, were to
become insufficient to pay these charges, additional bonds would be required to
be sold.

The Fund may be concentrated in one or more of types of bonds.
Concentration in a State may involve additional risk because of the decreased
diversification of economic, political, financial and market risks. Set forth
below is a brief description of certain risks associated with bonds which may be
held by the Fund.
2
<PAGE>
Additional information is contained in the Information Supplement which is
available from the Trustee at no charge to the investor.

GENERAL OBLIGATION BONDS

Certain of the Bonds may be general obligations of a governmental entity.
General obligation bonds are backed by the issuer's pledge of its full faith,
credit and taxing power for the payment of principal and interest. However, the
taxing power of any governmental entity may be limited by provisions of state
constitutions or laws and its credit will depend on many factors, including an
erosion of the tax base resulting from population declines, natural disasters,
declines in the state's industrial base or an inability to attract new
industries, economic limits on the ability to tax without eroding the tax base
and the extent to which the entity relies on federal or state aid, access to
capital markets or other factors beyond the entity's control. In addition,
political restrictions on the ability to tax and budgetary constraints affecting
state governmental aid may have an adverse impact on the creditworthiness of
cities, counties, school districts and other local governmental units.

As a result of the recent recession's adverse impact upon both revenues and
expenditures, as well as other factors, many state and local governments have
confronted deficits which were the most severe in recent years. Many issuers are
facing highly difficult choices about significant tax increases and spending
reductions in order to restore budgetary balance. The failure to implement these
actions on a timely basis could force these issuers to issue additional debt to
finance deficits or cash flow needs and could lead to a reduction of their bond
ratings and the value of their outstanding bonds.

MORAL OBLIGATION BONDS

The Portfolio may include 'moral obligation' bonds. If an issuer of moral
obligation bonds is unable to meet its obligations, the repayment of the bonds
becomes a moral commitment but not a legal obligation of the state or local
government in question. Even though the state or local government may be called
on to restore any deficits in capital reserve funds of the agencies or
authorities which issued the bonds, any restoration generally requires
appropriation by the state or local legislature and does not constitute a
legally enforceable obligation or debt of the state or local government. The
agencies or authorities generally have no taxing power.

REFUNDED BONDS

Refunded bonds are typically secured by direct obligations of the U.S.
Government or in some cases obligations guaranteed by the U.S. Government placed
in an escrow account maintained by an independent trustee until maturity or a
predetermined redemption date. These obligations are generally noncallable prior
to maturity or the predetermined redemption date. In a few isolated instances,
however, bonds which were thought to be escrowed to maturity have been called
for redemption prior to maturity.

MUNICIPAL REVENUE BONDS

Municipal revenue bonds are tax-exempt securities issued by states,
municipalities, public authorities or similar entities to finance the cost of
acquiring, constructing or improving various projects. Municipal revenue bonds
are not general obligations of governmental entities backed by their taxing
power and payment is generally solely dependent upon the creditworthiness of the
public issuer or the financed project or state appropriations. Examples of
municipal revenue bonds are:

Municipal utility bonds, including electrical, water and sewer revenue
bonds, whose payments are dependent on various factors, including the rates
the utilities may charge, the demand for their services and their operating
costs, including expenses to comply with environmental legislation and
other energy and licensing laws and regulations. Utilities are particularly
sensitive to, among other things, the effects of inflation on operating and
construction costs, the unpredictability of future usage requirements, the
costs and availability of fuel and, with certain electric utilities, the
risks associated with the nuclear industry;

Lease rental bonds which are generally issued by governmental financing
authorities with no direct taxing power for the purchase of equipment or
construction of buildings that will be used by a state or local government.
Lease rental bonds are generally subject to an annual risk that the lessee
government might not appropriate funds for the leasing rental payments to
service the bonds and may also be subject to the risk that rental
obligations may terminate in the event of damage to or destruction or
condemnation of the equipment or building;

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<PAGE>

Multi-family housing revenue bonds and single family mortgage revenue
bonds which are issued to provide financing for various housing projects
and which are payable primarily from the revenues derived from mortgage
loans to housing projects for low to moderate income families or notes
secured by mortgages on residences; repayment of this type of bond is
therefore dependent upon, among other things, occupancy levels, rental
income, the rate of default on underlying mortgage loans, the ability of
mortgage insurers to pay claims, the continued availability of federal,
state or local housing subsidy programs, economic conditions in local
markets, construction costs, taxes, utility costs and other operating
expenses and the managerial ability of project managers. Housing bonds are
generally prepayable at any time and therefore their average life will
ordinarily be less than their stated maturities;

Hospital and health care facility bonds whose payments are dependent
upon revenues of hospitals and other health care facilities. These revenues
come from private third-party payors and government programs, including the
Medicare and Medicaid programs, which have generally undertaken cost
containment measures to limit payments to health care facilities. Hospitals
and health care facilities are subject to various legal claims by patients
and others and are adversely affected by increasing costs of insurance. The
Internal Revenue Service has been engaged in a program of intensive audits
of certain large tax-exempt hospital and health care facility
organizations. Although these audits have not yet been completed, it has
been reported that the tax-exempt status of some of these organizations may
be revoked;

Airport, port, highway and transit authority revenue bonds which are
dependent for payment on revenues from the financed projects, including
user fees from ports and airports, tolls on turnpikes and bridges, rents
from buildings, transit fare revenues and additional financial resources
including federal and state subsidies, lease rentals paid by state or local
governments or a pledge of a special tax such as a sales tax or a property
tax. In the case of the air travel industry, airport income is largely
affected by the airlines' ability to meet their obligations under use
agreements which in turn is affected by increased competition among
airlines, excess capacity and increased fuel costs, among other factors;

Solid waste disposal bonds which are generally payable from dumping and
user fees and from revenues that may be earned by the facility on the sale
of electrical energy generated in the combustion of waste products and
which are therefore dependent upon the ability of municipalities to fully
utilize the facilities, sufficient supply of waste for disposal, economic
or population growth, the level of construction and maintenance costs, the
existence of lower-cost alternative modes of waste processing and
increasing environmental regulation. A recent decision of the U.S. Supreme
Court limiting a municipality's ability to require use of its facilities
may have an adverse affect on the credit quality of various issues of these
bonds;

Special tax bonds which are not secured by general tax revenues but are
only payable from and secured by the revenues derived by a municipality
from a particular tax--for example, a tax on the rental of a hotel room, on
the purchase of food and beverages, on the rental of automobiles or on the
consumption of liquor and may therefore be adversely affected by a
reduction in revenues resulting from a decline in the local economy or
population or a decline in the consumption, use or cost of the goods and
services that are subject to taxation;

Student loan revenue bonds which are typically secured by pledges of new
or existing student loans. The loans, in turn, are generally either
guaranteed by eligible guarantors and reinsured by the Secretary of the
U.S. Department of Education, directly insured by the federal government,
or financed as part of supplemental or alternative loan programs within a
state (e.g., loan repayments are not guaranteed). These bonds often permit
the issuer to enter into interest rate swap agreements with eligible
counterparties in which event the bonds are subject to the additional risk
of the counterparty's ability to fulfill its swap obligation;

University and college bonds, the payments on which are dependent upon
various factors, including the size and diversity of their sources of
revenues, enrollment, reputation, the availability of endowments and other
funds and, in the case of public institutions, the financial condition of
the relevant state or other governmental entity and its policies with
respect to education; and

Tax increment and tax allocation bonds, which are secured by ad valorem
taxes imposed on the incremental increase of taxable assessed valuation of
property within a jurisdiction above an established base of assessed value.
The issuers of these bonds do not have general taxing authority and the tax
assessments on which the taxes used to service the bonds are based may be

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<PAGE>
subject to devaluation due to market price declines or governmental action.

Puerto Rico. Certain Bonds may be affected by general economic conditions
in the Commonwealth of Puerto Rico. Puerto Rico's economy is largely dependent
for its development on federal programs, and current federal budgetary policies
suggest that an expansion of its programs is unlikely. Reductions in federal tax
benefits or incentives or curtailment of spending programs could adversely
affect the Puerto Rican economy.

Industrial Development Revenue Bonds. Industrial development revenue bonds
are municipal obligations issued to finance various privately operated projects
including pollution control and manufacturing facilities. Payment is generally
solely dependent upon the creditworthiness of the corporate operator of the
project and, in certain cases, an affiliated or third party guarantor and may be
affected by economic factors relating to the particular industry as well as
varying degrees of governmental regulation. In many cases industrial revenue
bonds do not have the benefit of covenants which would prevent the corporations
from engaging in capital restructurings or borrowing transactions which could
reduce their ability to meet their obligations and result in a reduction in the
value of the Portfolio.

BONDS BACKED BY REPURCHASE COMMITMENTS

Certain Funds contain Bonds that were purchased from commercial banks,
savings banks, savings and loan associations or other institutions (thrifts)
that had held the Bonds in their investment portfolios prior to selling the
Bonds to the Fund. These banks or thrifts (the Sellers) have committed to
repurchase the Bonds from the Fund in certain circumstances. In some cases a
Seller's Repurchase Commitments may be backed by a security interest in
collateral or by a letter of credit (see Bonds Backed by Letters of Credit or
Insurance below).

A Seller may have committed to repurchase any Bond sold by it if necessary
to satisfy investors' unit redemption requests (a Liquidity Repurchase). A
Seller may also have committed to repurchase any Bond sold by it if the issuer
of the Bond fails to make payments of interest or principal on the Bond (a
Default Repurchase) or if the issuer becomes or is deemed to be bankrupt or
insolvent (an Insolvency Repurchase). A Seller may have committed to repurchase
any Bond if the interest on that Bond becomes taxable (a Tax Repurchase).
Investors should realize that they are subject to having all or a portion of the
principal amount of their investment returned prior to termination of the Fund
if any of these situations occurs. A Seller may also have committed to
repurchase the Bonds sold by it on their scheduled disposition dates (as shown
under Portfolio in Part A) (a Disposition Repurchase). The price at which any of
these repurchases will occur (the Put Price) is shown in Part A of the
Prospectus. Any collateral securing any of the Repurchase Commitments may
consist of mortgage-backed securities issued by GNMA (Ginnie Maes), FNMA (Fannie
Maes) or FHLMC (Freddie Macs); mortgages; municipal obligations; corporate
obligations; U.S. government securities; and cash.

Investors in a Fund containing any of these credit-supported Bonds should
be aware that many thrifts have failed in recent years and that the thrift
industry generally has experienced severe strains. New federal legislation has
resulted that imposes many new limitations on the ways banks and thrifts may do
business and mandates aggressive, early intervention into unhealthy
institutions. One result of this legislation is an increased possibility of
early payment of the principal amount of an investment in Bonds backed by
collateralized letters of credit or repurchase commitments if a Seller becomes
or is deemed to be insolvent.

BONDS BACKED BY LETTERS OF CREDIT OR INSURANCE

Certain Bonds may be secured by letters of credit issued by commercial
banks or savings banks, savings and loan associations and similar thrift
institutions or are direct obligations of banks or thrifts. The letter of credit
may be drawn upon, and the Bonds redeemed, if an issuer fails to pay amounts due
on the Bonds or, in certain cases, if the interest on the Bond becomes taxable.
Letters of credit are irrevocable obligations of the issuing institutions. The
profitability of a financial institution is largely dependent upon the credit
quality of its loan portfolio which, in turn, is affected by the institution's
underwriting criteria, concentrations within the portfolio and specific industry
and general economic conditions. The operating performance of financial
institutions is also impacted by changes in interest rates, the availability
and cost of funds, the intensity of competition and the degree of governmental
regulation.

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<PAGE>

Certain Bonds may be insured or guaranteed by insurance companies listed
below. The claims-paying ability of each of these companies, unless otherwise
indicated, was rated AAA by Standard & Poor's or another nationally recognized
rating organization at the time the insured Bonds were purchased by the Fund.
The ratings are subject to change at any time at the discretion of the rating
agencies. In the event that the rating of an Insured Fund is reduced, the
Sponsors are authorized to direct the Trustee to obtain other insurance on
behalf of the Fund. The insurance policies guarantee the timely payment of
principal and interest on the Bonds but do not guarantee their market value or
the value of the Units. The insurance policies generally do not provide for
accelerated payments of principal or cover redemptions resulting from events of
taxability.

The following summary information relating to the listed insurance
companies has been obtained from publicly available information:
<TABLE><CAPTION>
FINANCIAL INFORMATION
AS OF JUNE 30, 1995
(IN MILLIONS OF DOLLARS)
--------------------------------------
POLICYHOLDERS'
NAME DATE ESTABLISHED ADMITTED ASSETS SURPLUS
- ---------------------------------------------------- ----------------- --------------- ---------------------
<S> <C> <C> <C>
AMBAC Indemnity Corporation......................... 1970 $ 2,230 $ 805
Asset Guaranty Insurance Co. (AA by S&P) 1988 173 78
Capital Guaranty Insurance Company (CGIC)........... 1986 316 171
Capital Markets Assurance Corp. (CAPMAC)............ 1987 221 136
Connie Lee Insurance Company........................ 1987 202 108
Continental Casualty Company........................ 1948 20,114 3,747
Financial Guaranty Insurance Company................ 1984 2,249 978
Financial Security Assurance Inc. (FSA)............. 1984 776 344
Firemen's Insurance Company of Newark, NJ 1855 2,083 403
Industrial Indemnity Co. (HIBI)..................... 1920 1,706 302
MBIA Insurance Corporation.......................... 1986 3,623 1,165
</TABLE>

Insurance companies are subject to extensive regulation and supervision
where they do business by state insurance commissioners who regulate the
standards of solvency which must be maintained, the nature of and limitations on
investments, reports of financial condition, and requirements regarding reserves
for unearned premiums, losses and other matters. A significant portion of the
assets of insurance companies are required by law to be held in reserve against
potential claims on policies and is not available to general creditors. Although
the federal government does not regulate the business of insurance, federal
initiatives including pension regulation, controls on medical care costs,
minimum standards for no-fault automobile insurance, national health insurance,
tax law changes affecting life insurance companies and repeal of the antitrust
exemption for the insurance business can significantly impact the insurance
business.

STATE RISK FACTORS

Investment in a single State Trust, as opposed to a Fund which invests in
the obligations of several states, may involve some additional risk due to the
decreased diversification of economic, political, financial and market risks. A
brief description of the factors which may affect the financial condition of the
applicable State for any State Trust, together with a summary of tax
considerations relating to that State, appear in Part A (or for certain State
Trusts, Part C), of the Prospectus; further information is contained in the
Information Supplement.

LITIGATION AND LEGISLATION

The Sponsors do not know of any pending litigation as of the initial date
of deposit which might reasonably be expected to have a material adverse effect
upon the Fund. At any time after the initial date of deposit, litigation may be
initiated on a variety of grounds, or legislation may be enacted, affecting the
Bonds in the Fund. Litigation, for example, challenging the issuance of
pollution control revenue bonds under environmental protection statutes may
affect the validity of certain Bonds or the tax-free nature of their interest.
While the outcome of litigation of this nature can never be entirely
predicted, opinions of bond counsel are delivered on the date of issuance of
each Bond to the effect that it has been validly issued and that the interest
thereon is exempt

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<PAGE>
from federal income tax. From time to time, proposals are introduced
in Congress to, among other things, reduce federal income tax
rates, impose a flat tax, exempt investment income from tax or
abolish the federal income tax and replace it with another form of tax.
Enactment of any such legislation could adversely affect the value of the Units.
The Fund, however, cannot predict what legislation, if any, in respect of tax
rates may be proposed, nor can it predict which proposals, if any, might be
enacted.

Also, certain proposals, in the form of state legislative proposals or
voter initiatives, seeking to limit real property taxes have been introduced in
various states, and an amendment to the constitution of the State of California,
providing for strict limitations on real property taxes, has had a significant
impact on the taxing powers of local governments and on the financial condition
of school districts and local governments in California. In addition, other
factors may arise from time to time which potentially may impair the ability of
issuers to make payments due on the Bonds. Under the Federal Bankruptcy Code,
for example, municipal bond issuers, as well as any underlying corporate
obligors or guarantors, may proceed to restructure or otherwise alter the terms
of their obligations.

From time to time Congress considers proposals to prospectively and
retroactively tax the interest on state and local obligations, such as the
Bonds. The Supreme Court clarified in South Carolina v. Baker (decided on April
20, 1988) that the U.S. Constitution does not prohibit Congress from passing a
nondiscriminatory tax on interest on state and local obligations. This type of
legislation, if enacted into law, could require investors to pay income tax on
interest from the Bonds and could adversely affect an investment in Units. See
Taxes.

PAYMENT OF THE BONDS AND LIFE OF THE FUND

The size and composition of the Portfolio will change over time. Most of
the Bonds are subject to redemption prior to their stated maturity dates
pursuant to optional refunding or sinking fund redemption provisions or
otherwise. In general, optional refunding redemption provisions are more likely
to be exercised when the value of a Bond is at a premium over par than when it
is at a discount from par. Some Bonds may be subject to sinking fund and
extraordinary redemption provisions which may commence early in the life of the
Fund. Additionally, the size and composition of the Fund will be affected by the
level of redemptions of Units that may occur from time to time. Principally,
this will depend upon the number of investors seeking to sell or redeem their
Units and whether or not the Sponsors are able to sell the Units acquired by
them in the secondary market. As a result, Units offered in the secondary market
may not represent the same face amount of Bonds as on the initial date of
deposit. Factors that the Sponsors will consider in determining whether or not
to sell Units acquired in the secondary market include the diversity of the
Portfolio, the size of the Fund relative to its original size, the ratio of Fund
expenses to income, the Fund's current and long-term returns, the degree to
which Units may be selling at a premium over par and the cost of maintaining a
current prospectus for the Fund. These factors may also lead the Sponsors to
seek to terminate the Fund earlier than its mandatory termination date.

FUND TERMINATION

The Fund will be terminated no later than the mandatory termination date
specified in Part A of the Prospectus. It will terminate earlier upon the
disposition of the last Bond or upon the consent of investors holding 51% of the
Units. The Fund may also be terminated earlier by the Sponsors once the total
assets of the Fund have fallen below the minimum value specified in Part A of
the Prospectus. A decision by the Sponsors to terminate the Fund early will be
based on factors similar to those considered by the Sponsors in determining
whether to continue the sale of Units in the secondary market.

Notice of impending termination will be provided to investors and
thereafter units will no longer be redeemable. On or shortly before termination,
the Fund will seek to dispose of any Bonds remaining in the Portfolio although
any Bond unable to be sold at a reasonable price may continue to be held by the
Trustee in a liquidating trust pending its final disposition. A proportional
share of the expenses associated with termination, including brokerage costs in
disposing of Bonds, will be borne by investors remaining at that time. This may
have the effect of reducing the amount of proceeds those investors are to
receive in any final distribution.

LIQUIDITY

Up to 40% of the value of the Portfolio may be attributable to guarantees
or similar security provided by corporate entities. These guarantees or other
security may constitute restricted securities that cannot be sold
7
<PAGE>
publicly by the Trustee without registration under the Securities Act of 1933,
as amended. The Sponsors nevertheless believe that, should a sale of the Bonds
guaranteed or secured be necessary in order to meet redemption of Units, the
Trustee should be able to consummate a sale with institutional investors.

The principal trading market for the Bonds will generally be in the
over-the-counter market and the existence of a liquid trading market for the
Bonds may depend on whether dealers will make a market in them. There can be no
assurance that a liquid trading market will exist for any of the Bonds,
especially since the Fund may be restricted under the Investment Company Act of
1940 from selling Bonds to any Sponsor. The value of the Portfolio will be
adversely affected if trading markets for the Bonds are limited or absent.

HOW TO BUY UNITS

Units are available from any of the Sponsors, Underwriters and other
broker-dealers at the Public Offering Price plus accrued interest on the Units.
The Public Offering Price varies each Business Day with changes in the value of
the Portfolio and other assets and liabilities of the Fund.

Net accrued interest and principal cash, if any, are added to the Public
Offering Price, the Sponsors' Repurchase Price and the Redemption Price per
Unit. This represents the interest accrued on the Bonds, net of Fund expenses,
from the initial date of deposit to, but not including, the settlement date for
Units (less any prior distributions of interest income to investors). Bonds
deposited also carry accrued but unpaid interest up to the initial date of
deposit. To avoid having investors pay this additional accrued interest (which
earns no return) when they purchase Units, the Trustee advances and distributes
this amount to the Sponsors; it recovers this advance from interest received on
the Bonds. Because of varying interest payment dates on the Bonds, accrued
interest at any time will exceed the interest actually received by the Fund.

Because accrued interest on the Bonds is not received by the Fund at a
constant rate throughout the year, any Monthly Income Distribution may be more
or less than the interest actually received by the Fund. To eliminate
fluctuations in the Monthly Income Distribution, a portion of the Public
Offering Price may consist of cash in an amount necessary for the Trustee to
provide approximately equal distributions. Upon the sale or redemption of Units,
investors will receive their proportionate share of this cash. In addition, if a
Bond is sold, redeemed or otherwise disposed of, the Fund will periodically
distribute to investors the portion of this cash that is attributable to the
Bond.

The regular Monthly Income Distribution is stated in Part A of the
Prospectus and will change as the composition of the Portfolio changes over
time.

PUBLIC OFFERING PRICE--THE FOLLOWING SECTIONS APPLY TO TWO DIFFERENT TYPES OF
DEFINED MUNICIPAL FUNDS. INVESTORS SHOULD NOTE THE EXACT NAME OF THE FUND ON THE
COVER OF PART A OF THE PROSPECTUS TO MAKE SURE THEY REFER TO THE CORRECT SECTION
BELOW.

SECTION A--MUNICIPAL INVESTMENT TRUST FUND

In the initial offering period, the Public Offering Price is based on the
next offer side evaluation of the Bonds, and includes a sales charge based on
the number of Units of a single Fund or Trust purchased on the same or any
preceding day by a single purchaser. See Initial Offering sales charge schedule
in Appendix C. The purchaser or his dealer must notify the Sponsors at the time
of purchase of any previous purchase to be aggregated and supply sufficient
information to permit confirmation of eligibility; acceptance of the purchase
order is subject to confirmation. Purchases of Fund Units may not be aggregated
with purchases of any other unit trust. This procedure may be amended or
terminated at any time without notice.

In the secondary market (after the initial offering period), the Public
Offering Price is based on the bid side evaluation of the Bonds, and includes a
sales charge based (a) on the number of Units of the Fund and any other Series
of Municipal Investment Trust Fund purchased in the secondary market on the same
day by a single purchaser (see Secondary Market sales charge schedule in
Appendix C) and (b) the maturities of the underlying Bonds (see Effective Sales
Charge Schedule in Appendix C). To qualify for a reduced sales charge, the
dealer must confirm that the sale is to a single purchaser or is purchased for
its own account and not for distribution. For these purposes, Units held in
the name of the purchaser's spouse or child under 21 years of age are deemed
to be purchased by a single purchaser. A trustee or other fiduciary purchasing
securities for a single trust estate or single fiduciary account is also
considered a single purchaser.

8
<PAGE>

In the secondary market, the Public Offering Price is further reduced
depending on the maturities of the various Bonds in the Portfolio, by
determining a sales charge percentage for each Bond, as stated in Effective
Sales Charge in Appendix C. The sales charges so determined, multiplied by the
bid side evaluation of the Bonds, are aggregated and the total divided by the
number of Units outstanding to determine the Effective Sales Charge. On any
purchase, the Effective Sales Charge is multiplied by the applicable secondary
market sales charge percentage (depending on the number of Units purchased) in
order to determine the sales charge component of the Public Offering Price.

SECTION B--DEFINED ASSET FUNDS MUNICIPAL SERIES

During the initial offering period for at least the first three months of
the Fund, the Public Offering Price (and the Initial Repurchase Price) is based
on the higher, offer side evaluation of the Bonds at the next Evaluation Time
after the order is received. In the secondary market (after the initial offering
period), the Public Offering Price (and the Sponsors' Repurchase Price and the
Redemption Price) is based on the lower, bid side evaluation of the Bonds.

Investors will be subject to differing types and amounts of sales charge
depending upon the timing of their purchases and redemptions of Units. A
periodic deferred sales charge will be payable quarterly through about the fifth
anniversary of the Fund from a portion of the interest on and principal of Bonds
reserved for that purpose. Commencing on the first anniversary of the Fund, the
Public Offering Price will also include an up-front sales charge applied to the
value of the Bonds in the Portfolio. Lastly, investors redeeming their Units
prior to the fourth anniversary of the Fund will be charged a contingent
deferred sales charge payable out of the redemption proceeds of their Units.
These charges may be less than you would pay to buy and hold a comparable
managed fund. A complete schedule of sales charges appears in Appendix B. The
Sponsors have received an opinion of their counsel that the deferred sales
charge described in this Prospectus is consistent with an exemptive order
received from the SEC.

* * *

Employees of certain Sponsors and Sponsor affiliates and non-employee
directors of Merrill Lynch & Co. Inc. may purchase Units at any time at prices
including a sales charge of not less than $5 per Unit.

EVALUATIONS

Evaluations are determined by the independent Evaluator on each Business
Day. This excludes Saturdays, Sundays and the following holidays as observed by
the New York Stock Exchange: New Year's Day, Presidents' Day, Good Friday,
Memorial Day, Independence Day, Labor Day, Thanksgiving and Christmas. Bond
evaluations are based on closing sales prices (unless the Evaluator deems these
prices inappropriate). If closing sales prices are not available, the evaluation
is generally determined on the basis of current bid or offer prices for the
Bonds or comparable securities or by appraisal or by any combination of these
methods. In the past, the bid prices of publicly offered tax-exempt issues have
been lower than the offer prices by as much as 3 1/2% or more of face amount in
the case of inactively traded issues and as little as 1/2 of 1% in the case of
actively traded issues, but the difference between the offer and bid prices has
averaged between 1 and 2% of face amount. Neither the Sponsors, the Trustee or
the Evaluator will be liable for errors in the Evaluator's judgment. The fees of
the Evaluator will be borne by the Fund.

CERTIFICATES

Certificates for Units are issued upon request and may be transferred by
paying any taxes or governmental charges and by complying with the requirements
for redeeming Certificates (see How To Sell Units--Trustee's Redemption of
Units). Certain Sponsors collect additional charges for registering and shipping
Certificates to purchasers. Lost or mutilated Certificates can be replaced upon
delivery of satisfactory indemnity and payment of costs.

9
<PAGE>
HOW TO SELL UNITS

SPONSORS' MARKET FOR UNITS

You can sell your Units at any time without a fee. The Sponsors (although
not obligated to do so) will normally buy any Units offered for sale at the
repurchase price next computed after receipt of the order. The Sponsors have
maintained secondary markets in Defined Asset Funds for over 20 years. Primarily
because of the sales charge and fluctuations in the market value of the Bonds,
the sale price may be less than the cost of your Units. You should consult your
financial professional for current market prices to determine if other broker-
dealers or banks are offering higher prices for Units.

The Sponsors may discontinue this market without prior notice if the supply
of Units exceeds demand or for other business reasons; in that event, the
Sponsors may still purchase Units at the redemption price as a service to
investors. The Sponsors may reoffer or redeem Units repurchased.

TRUSTEE'S REDEMPTION OF UNITS

You may redeem your Units by sending the Trustee a redemption request
together with any certificates you hold. Certificates must be properly endorsed
or accompanied by a written transfer instrument with signatures guaranteed by an
eligible institution. In certain instances, additional documents may be required
such as a certificate of death, trust instrument, certificate of corporate
authority or appointment as executor, administrator or guardian. If the Sponsors
are maintaining a market for Units, they will purchase any Units tendered at the
repurchase price described above. While Defined Asset Funds Municipal Series
have a declining deferred sales charge payable on redemption (see Appendix B), a
Municipal Investment Trust Fund has no back-end load or 12b-1 fees, so there is
never a fee for cashing in your investment (see Appendix C). If they do not
purchase Units tendered, the Trustee is authorized in its discretion to sell
Units in the over-the-counter market if it believes it will obtain a higher net
price for the redeeming investor.

By the seventh calendar day after tender you will be mailed an amount equal
to the Redemption Price per Unit. Because of market movements or changes in the
Portfolio, this price may be more or less than the cost of your Units. The
Redemption Price per Unit is computed each Business Day by adding the value of
the Bonds, net accrued interest, cash and the value of any other Fund assets;
deducting unpaid taxes or other governmental charges, accrued but unpaid Fund
expenses, unreimbursed Trustee advances, cash held to redeem Units or for
distribution to investors and the value of any other Fund liabilities; and
dividing the result by the number of outstanding Units.

For Defined Asset Funds Municipal Series, Bonds are evaluated on the offer
side during the initial offering period and for at least the first three months
of the Fund (even in the secondary market) and on the bid side thereafter. For a
Municipal Investment Trust Fund, Bonds are evaluated on the offer side during
the initial offering period and on the bid side thereafter.

If cash is not available in the Fund's Income and Capital Accounts to pay
redemptions, the Trustee may sell Bonds selected by the Agent for the Sponsors
based on market and credit factors determined to be in the best interest of the
Fund. These sales are often made at times when the Bonds would not otherwise be
sold and may result in lower prices than might be realized otherwise and will
also reduce the size and diversity of the Fund.

Redemptions may be suspended or payment postponed if the New York Stock
Exchange is closed other than for customary weekend and holiday closings, if the
SEC determines that trading on that Exchange is restricted or that an emergency
exists making disposal or evaluation of the Bonds not reasonably practicable, or
for any other period permitted by the SEC.

INCOME, DISTRIBUTIONS AND REINVESTMENT

INCOME

Some of the Bonds may have been purchased on a when-issued basis or may
have a delayed delivery. Since interest on these Bonds does not begin to accrue
until the date of their delivery to the Fund, the Trustee's annual fee and
expenses may be reduced to provide tax-exempt income to investors for this
non-accrual period. If a when-issued Bond is not delivered until later than
expected and the amount of the Trustee's annual fee and expenses is insufficient
to cover the additional accrued interest, the Sponsors will treat the contracts
as failed

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Bonds. The Trustee is compensated for its fee reduction by drawing on the letter
of credit deposited by the Sponsors before the settlement date for these Bonds
and depositing the proceeds in a non-interest bearing account for the Fund.

Interest received is credited to an Income Account and other receipts to a
Capital Account. A Reserve Account may be created by withdrawing from the Income
and Capital Accounts amounts considered appropriate by the Trustee to reserve
for any material amount that may be payable out of the Fund.

DISTRIBUTIONS

Each Unit receives an equal share of monthly distributions of interest
income net of estimated expenses. Interest on the Bonds is generally received by
the Fund on a semi-annual or annual basis. Because interest on the Bonds is not
received at a constant rate throughout the year, any Monthly Income Distribution
may be more or less than the interest actually received. To eliminate
fluctuations in the Monthly Income Distribution, the Trustee will advance
amounts necessary to provide approximately equal interest distributions; it will
be reimbursed, without interest, from interest received on the Bonds, but the
Trustee is compensated, in part, by holding the Fund's cash balances in
non-interest bearing accounts. Along with the Monthly Income Distributions, the
Trustee will distribute the investor's pro rata share of principal received from
any disposition of a Bond to the extent available for distribution. In addition,
for Defined Asset Funds Municipal Series, distributions of amounts necessary to
pay the deferred portion of the sales charge will be made from the Capital and
Income Accounts to an account maintained by the Trustee for purposes of
satisfying investors' sales charge obligations.

The initial estimated annual income per Unit, after deducting estimated
annual Fund expenses (and, for Defined Asset Funds Municipal Series, the portion
of the deferred sales charge payable from interest income) as stated in Part A
of the Prospectus, will change as Bonds mature, are called or sold or otherwise
disposed of, as replacement bonds are deposited and as Fund expenses change.
Because the Portfolio is not actively managed, income distributions will
generally not be affected by changes in interest rates. Depending on the
financial conditions of the issuers of the Bonds, the amount of income should be
substantially maintained as long as the Portfolio remains unchanged; however,
optional bond redemptions or other Portfolio changes may occur more frequently
when interest rates decline, which would result in early returns of principal
and possibly earlier termination of the Fund.

RETURN CALCULATIONS

Estimated Current Return shows the estimated annual cash to be received
from interest-bearing bonds in a Portfolio (net of estimated annual expenses)
divided by the Public Offering Price (including the maximum sales charge).
Estimated Long Term Return is a measure of the estimated return over the
estimated life of the Trust. This represents 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 maximum sales charge and estimated
expenses. The average yield for the Portfolio is derived by weighting each
Bond's yield by its market value and the time remaining to the call or maturity
date, depending on how the Bond is priced. Unlike Estimated Current Return,
Estimated Long Term Return takes into account maturities, discounts and premiums
of the underlying Bonds.

No return estimate can be predictive of your actual return because returns
will vary with purchase price (including sales charges), how long units are
held, changes in Portfolio composition, changes in interest income and changes
in fees and expenses. Therefore, Estimated Current Return and Estimated Long
Term Return are designed to be comparative rather than predictive. A yield
calculation which is more comparable to an individual Bond may be higher or
lower than Estimated Current Return or Estimated Long Term Return which are more
comparable to return calculations used by other investment products.

REINVESTMENT

Distributions will be paid in cash unless the investor elects to have
distributions reinvested without sales charge in the Municipal Fund Accumulation
Program, Inc. The Program is an open-end management investment company whose
investment objective is to obtain income exempt from regular federal income
taxes by investing in a diversified portfolio of state, municipal and public
authority bonds rated A or better or with comparable credit characteristics.
Reinvesting compounds earnings free from federal tax. Investors participating in
the Program will be subject to state and local income taxes to the same extent
as if the distributions had been received

11
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in cash, and most of the income on the Program is subject to state and local
income taxes. For more complete information about the Program, including charges
and expenses, request the Program's prospectus from the Trustee. Read it
carefully before you decide to participate. Written notice of election to
participate must be received by the Trustee at least ten days before the Record
Day for the first distribution to which the election is to apply.

FUND EXPENSES

Estimated annual Fund expenses are listed in Part A of the Prospectus; if
actual expenses exceed the estimate, the excess will be borne by the Fund. The
Trustee's annual fee is payable in monthly installments. The Trustee also
benefits when it holds cash for the Fund in non-interest bearing accounts.
Possible additional charges include Trustee fees and expenses for maintaining
the Fund's registration statement current with Federal and State authorities,
extraordinary services, costs of indemnifying the Trustee and the Sponsors,
costs of action taken to protect the Fund and other legal fees and expenses,
Fund termination expenses and any governmental charges. The Trustee has a lien
on Fund assets to secure reimbursement of these amounts and may sell Bonds for
this purpose if cash is not available. The Sponsors receive an annual fee of a
maximum of $0.35 per $1,000 face amount to reimburse them for the cost of
providing Portfolio supervisory services to the Fund. While the fee may exceed
their costs of providing these services to the Fund, the total supervision fees
from all Defined Asset Funds Municipal Series will not exceed their costs for
these services to all of those Series during any calendar year; and the total
supervision fees from all Series of Municipal Investment Trust Fund will not
exceed their costs for these services to all of those Series during any calendar
year. The Sponsors may also be reimbursed for their costs of providing
bookkeeping and administrative services to the Fund, currently estimated at
$0.10 per Unit. The Trustee's, Sponsors' and Evaluator's fees may be adjusted
for inflation without investors' approval.

All or a portion of expenses incurred in establishing the Fund, including
the cost of the initial preparation of documents relating to the Fund, Federal
and State registration fees, the initial fees and expenses of the Trustee, legal
expenses and any other out-of-pocket expenses will be paid by the Fund and
amortized over five years. Advertising and selling expenses will be paid from
the Underwriting Account at no charge to the Fund. Sales charges on Defined
Asset Funds range from under 1.0% to 5.5%. This may be less than you might pay
to buy and hold a comparable managed fund. Defined Asset Funds can be a
cost-effective way to purchase and hold investments. Annual operating expenses
are generally lower than for managed funds. Because Defined Asset Funds have no
management fees, limited transaction costs and no ongoing marketing expenses,
operating expenses are generally less than 0.25% a year. When compounded
annually, small differences in expense ratios can make a big difference in your
investment results. Because our portfolios rarely hold any significant amount of
cash, your money is more fully invested.

TAXES

The following discussion addresses only the U.S. federal and certain New
York State and City income tax consequences under current law of Units held as
capital assets and does not address the tax consequences of Units held by
dealers, financial institutions or insurance companies or other investors with
special circumstances.

In the opinion of Davis Polk & Wardwell, special counsel for the Sponsors,
under existing law:

The Fund is not an association taxable as a corporation for federal
income tax purposes. Each investor will be considered the owner of a pro
rata portion of each Bond in the Fund under the grantor trust rules of
Sections 671-679 of the Internal Revenue Code of 1986, as amended (the
'Code'). Each investor will be considered to have received the interest and
accrued the original issue discount, if any, on his pro rata portion of
each Bond when interest on the Bond is received or original issue discount
is accrued by the Fund. The investor's basis in his Units will be equal to
the cost of his Units, including any up-front sales charge and the
organizational expenses borne by the investor.

When an investor pays for accrued interest, the investor's confirmation
of purchase will report to him the amount of accrued interest for which he
paid. These investors will receive the accrued interest amount as part of
their first monthly distribution. Accordingly, these investors should
reduce their tax basis by the accrued interest amount after the first
monthly distribution.

An investor will recognize taxable gain or loss when all or part of his
pro rata portion of a Bond is disposed of by the Fund. An investor will
also be considered to have disposed of all or a portion of his pro rata
portion of each Bond when he sells or redeems all or some of his Units. An
investor who is treated as

12
<PAGE>
having acquired his pro rata portion of a Bond at a premium will be
required to amortize the premium over the term of the Bond. The
amortization is only a reduction of basis for the investor's pro rata
portion of the Bond and does not result in any deduction against the
investor's income. Therefore, under some circumstances, an investor may
recognize taxable gain when his pro rata portion of a Bond is disposed of
for an amount equal to or less than his original tax basis therefor.

Under Section 265 of the Code, a non-corporate investor is not entitled
to a deduction for his pro rata share of fees and expenses of the Fund,
because the fees and expenses are incurred in connection with the
production of tax-exempt income. Further, if borrowed funds are used by an
investor to purchase or carry Units of the Fund, interest on this
indebtedness will not be deductible for federal income tax purposes. In
addition, under rules used by the Internal Revenue Service, the purchase of
Units may be considered to have been made with borrowed funds even though
the borrowed funds are not directly traceable to the purchase of Units.

Under the income tax laws of the State and City of New York, the Fund is
not an association taxable as a corporation and income received by the Fund
will be treated as the income of the investors in the same manner as for
federal income tax purposes, but will not be tax-exempt except to the
extent such income is earned by bonds in the Fund that are otherwise
tax-exempt for New York purposes.

The foregoing discussion relates only to U.S. federal and certain
aspects of New York State and City income taxes. Depending on their state
of residence, investors may be subject to state and local taxation and
should consult their own tax advisers in this regard.

* * *

In the opinion of bond counsel rendered on the date of issuance of each
Bond, the interest on each Bond is excludable from gross income under existing
law for regular federal income tax purposes (except in certain circumstances
depending on the investor) but may be subject to state and local taxes, and
interest on some or all of the Bonds may become subject to regular federal
income tax, perhaps retroactively to their date of issuance, as a result of
changes in federal law or as a result of the failure of issuers (or other users
of the proceeds of the Bonds) to comply with certain ongoing requirements. If
the interest on a Bond should be determined to be taxable, the Bond would
generally have to be sold at a substantial discount. In addition, investors
could be required to pay income tax on interest received prior to the date on
which the interest is determined to be taxable.

Neither the Sponsors nor Davis Polk & Wardwell have made or will make any
review of the proceedings relating to the issuance of the Bonds or the basis for
these opinions and there can be no assurance that the issuer (and other users)
will comply with any ongoing requirements necessary for a Bond to maintain its
tax-exempt character.

The Internal Revenue Service is currently engaged in a program of intensive
audits of certain tax-exempt hospital and health care facility organizations.
Although these audits have not yet been completed, it has been reported that the
tax-exempt status of some of these organizations may be revoked. At this time,
it is uncertain whether any of the hospital and health care facility obligations
held by the Fund will be affected by such audit proceedings.

RECORDS AND REPORTS

The Trustee keeps a register of the names, addresses and holdings of all
investors. The Trustee also keeps records of the transactions of the Fund,
including a current list of the Bonds and a copy of the Indenture, and
supplemental information on the operations of the Fund and the risks associated
with the Bonds held by the Fund, which may be inspected by investors at
reasonable times during business hours.

With each distribution, the Trustee includes a statement of the interest
and any other receipts being distributed. Within five days after deposit of
Bonds in exchange or substitution for Bonds (or contracts) previously deposited,
the Trustee will send a notice to each investor, identifying both the Bonds
removed and the replacement bonds deposited. The Trustee sends each investor of
record an annual report summarizing transactions in the Fund's accounts and
amounts distributed during the year and Bonds held, the number of Units
outstanding and the Redemption Price at year end, the interest received by the
Fund on the Bonds, the gross proceeds received by the Fund from the disposition
of any Bond (resulting from redemption or payment at maturity or sale of any
Bond), and the fees and expenses paid by the Fund, among other matters. The
Trustee will

13
<PAGE>
also furnish annual information returns to each investor and to the Internal
Revenue Service. Investors are required to report to the Internal Revenue
Service the amount of tax-exempt interest received during the year. Investors
may obtain copies of Bond evaluations from the Trustee to enable them to comply
with federal and state tax reporting requirements. Fund accounts are audited
annually by independent accountants selected by the Sponsors. Audited financial
statements are available from the Trustee on request.

TRUST INDENTURE

The Fund is a 'unit investment trust' created under New York law by a Trust
Indenture among the Sponsors, the Trustee and the Evaluator. This Prospectus
summarizes various provisions of the Indenture, but each statement is qualified
in its entirety by reference to the Indenture.

The Indenture may be amended by the Sponsors and the Trustee without
consent by investors to cure ambiguities or to correct or supplement any
defective or inconsistent provision, to make any amendment required by the SEC
or other governmental agency or to make any other change not materially adverse
to the interest of investors (as determined in good faith by the Sponsors). The
Indenture may also generally be amended upon consent of investors holding 51% of
the Units. No amendment may reduce the interest of any investor in the Fund
without the investor's consent or reduce the percentage of Units required to
consent to any amendment without unanimous consent of investors. Investors will
be notified on the substance of any amendment.

The Trustee may resign upon notice to the Sponsors. It may be removed by
investors holding 51% of the Units at any time or by the Sponsors without the
consent of investors if it becomes incapable of acting or bankrupt, its affairs
are taken over by public authorities, or if under certain conditions the
Sponsors determine in good faith that its replacement is in the best interest of
the investors. The Evaluator may resign or be removed by the Sponsors and the
Trustee without the investors' consent. The resignation or removal of either
becomes effective upon acceptance of appointment by a successor; in this case,
the Sponsors will use their best efforts to appoint a successor promptly;
however, if upon resignation no successor has accepted appointment within 30
days after notification, the resigning Trustee or Evaluator may apply to a court
of competent jurisdiction to appoint a successor.

Any Sponsor may resign so long as one Sponsor with a net worth of
$2,000,000 remains and is agreeable to the resignation. A new Sponsor may be
appointed by the remaining Sponsors and the Trustee to assume the duties of the
resigning Sponsor. If there is only one Sponsor and it fails to perform its
duties or becomes incapable of acting or bankrupt or its affairs are taken over
by public authorities, the Trustee may appoint a successor Sponsor at reasonable
rates of compensation, terminate the Indenture and liquidate the Fund or
continue to act as Trustee without a Sponsor. Merrill Lynch, Pierce, Fenner &
Smith Incorporated has been appointed as Agent for the Sponsors by the other
Sponsors.

The Sponsors, the Trustee and the Evaluator are not liable to investors or
any other party for any act or omission in the conduct of their responsibilities
absent bad faith, willful misfeasance, negligence (gross negligence in the case
of a Sponsor or the Evaluator) or reckless disregard of duty. The Indenture
contains customary provisions limiting the liability of the Trustee.

MISCELLANEOUS

LEGAL OPINION

The legality of the Units has been passed upon by Davis Polk & Wardwell,
450 Lexington Avenue, New York, New York 10017, as special counsel for the
Sponsors.

AUDITORS

The Statement of Condition in the Prospectus was audited by Deloitte &
Touche LLP, independent accountants, as stated in their opinion. It is included
in reliance upon that opinion given on the authority of that firm as experts in
accounting and auditing.

TRUSTEE

The Trustee and its address are stated on the back cover of the Prospectus.
The Trustee is subject to supervision by the Federal Deposit Insurance
Corporation, the Board of Governors of the Federal Reserve System and either the
Comptroller of the Currency or state banking authorities.

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<PAGE>
SPONSORS

The Sponsors are listed on the back cover of the Prospectus. They may
include Merrill Lynch, Pierce, Fenner & Smith Incorporated, a wholly-owned
subsidiary of Merrill Lynch Co. Inc.; Smith Barney Inc., an indirect
wholly-owned subsidiary of The Travelers Inc.; Prudential Securities
Incorporated, an indirect wholly-owned subsidiary of the Prudential Insurance
Company of America; Dean Witter Reynolds, Inc., a principal operating subsidiary
of Dean Witter Discover & Co. and PaineWebber Incorporated, a wholly-owned
subsidiary of PaineWebber Group Inc. Each Sponsor, or one of its predecessor
corporations, has acted as Sponsor of a number of series of unit investment
trusts. Each Sponsor has acted as principal underwriter and managing underwriter
of other investment companies. The Sponsors, in addition to participating as
members of various selling groups or as agents of other investment companies,
execute orders on behalf of investment companies for the purchase and sale of
securities of these companies and sell securities to these companies in their
capacities as brokers or dealers in securities.

PUBLIC DISTRIBUTION

In the initial offering period Units will be distributed to the public
through the Underwriting Account and dealers who are members of the National
Association of Securities Dealers, Inc. The initial offering period is 30 days
or less if all Units are sold. If some Units initially offered have not been
sold, the Sponsors may extend the initial offering period for up to four
additional successive 30-day periods.

The Sponsors intend to qualify Units for sale in all states in which
qualification is deemed necessary through the Underwriting Account and by
dealers who are members of the National Association of Securities Dealers, Inc.;
however, Units of a State trust will be offered for sale only in the State for
which the trust is named, except that Units of a New Jersey trust will also be
offered in Connecticut, Units of a Florida trust will also be offered in New
York and Units of a New York trust will also be offered in Connecticut, Florida
and Puerto Rico. The Sponsors do not intend to qualify Units for sale in any
foreign countries and this Prospectus does not constitute an offer to sell Units
in any country where Units cannot lawfully be sold. Sales to dealers and to
introducing dealers, if any, will initially be made at prices which represent a
concession from the Public Offering Price, but the Agent for the Sponsors
reserves the right to change the rate of any concession from time to time. Any
dealer or introducing dealer may reallow a concession up to the concession to
dealers.

UNDERWRITERS' AND SPONSORS' PROFITS

Upon sale of the Units, the Underwriters will be entitled to receive sales
charges. The Sponsors also realize a profit or loss on deposit of the Bonds
equal to the difference between the cost of the Bonds to the Fund (based on the
offer side evaluation on the initial date of deposit) and the Sponsors' cost of
the Bonds. In addition, a Sponsor or Underwriter may realize profits or sustain
losses on Bonds it deposits in the Fund which were acquired from underwriting
syndicates of which it was a member. During the initial offering period, the
Underwriting Account also may realize profits or sustain losses as a result of
fluctuations after the initial date of deposit in the Public Offering Price of
the Units. In maintaining a secondary market for Units, 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 these Units
(which include the sales charge) or the prices at which they redeem the Units.
Cash, if any, made available by buyers of Units to the Sponsors prior to a
settlement date for the purchase of Units may be used in the Sponsors'
businesses to the extent permitted by Rule 15c3-3 under the Securities Exchange
Act of 1934 and may be of benefit to the Sponsors.

FUND PERFORMANCE

Information on the performance of the Fund for various periods, on the
basis of changes in Unit price plus the amount of income and principal
distributions reinvested, may be included from time to time in advertisements,
sales literature, reports and other information furnished to current or
prospective investors. Total return figures are not averaged, and may not
reflect deduction of the sales charge, which would decrease the return. Average
annualized return figures reflect deduction of the maximum sales charge. No
provision is made for any income taxes payable.

Past performance may not be indicative of future results. The Fund is not
actively managed. Unit price and return fluctuate with the value of the Bonds in
the Portfolio, so there may be a gain or loss when Units are sold.

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<PAGE>
Fund performance may be compared to performance on the same basis (with
distributions reinvested) of Moody's Municipal Bond Averages or performance data
from publications such as Lipper Analytical Services, Inc., Morningstar
Publications, Inc., Money Magazine, The New York Times, U.S. News and World
Report, Barron's Business Week, CDA Investment Technology, Inc., Forbes Magazine
or Fortune Magazine. As with other performance data, performance comparisons
should not be considered representative of the Fund's relative performance for
any future period.

DEFINED ASSET FUNDS

Municipal Investment Trust Funds have provided investors with tax-free
income for more than 30 years. For decades informed investors have purchased
unit investment trusts for dependability and professional selection of
investments. Defined Asset Funds' philosophy is to allow investors to 'buy with
knowledge' (because, unlike managed funds, the portfolio of municipal bonds and
the return are relatively fixed) and 'hold with confidence' (because the
portfolio is professionally selected and regularly reviewed). Defined Asset
Funds offers an array of simple and convenient investment choices, suited to fit
a wide variety of personal financial goals--a buy and hold strategy for capital
accumulation, such as for children's education or retirement, or attractive,
regular current income consistent with the preservation of principal. Tax-exempt
income can help investors keep more today for a more secure financial future. It
can also be important in planning because tax brackets may increase with higher
earnings or changes in tax laws. Unit investment trusts are particularly suited
for the many investors who prefer to seek long-term income by purchasing sound
investments and holding them, rather than through active trading. Few
individuals have the knowledge, resources or capital to buy and hold a
diversified portfolio on their own; it would generally take a considerable sum
of money to obtain the breadth and diversity that Defined Asset Funds offer.
One's investment objectives may call for a combination of Defined Asset Funds.
Defined Asset Funds reflect a buy and hold strategy that the Sponsors
believe can be more effective and cheaper than active management. This strategy
is premised on selection criteria and procedures, diversification and regular
monitoring by investment professionals. Various advertisements and sales
literature may summarize the results of economic studies concerning how stock
market movement has tended to be concentrated and how longer-term investments
can tend to reduce risk.

One of the most important investment decisions you face may be how to
allocate your investments among asset classes. Diversification among different
kinds of investments can balance the risks and rewards of each one. Most
investment experts recommend stocks for long-term capital growth. Long-term
corporate bonds offer relatively high rates of interest income. By purchasing
both defined equity and defined bond funds, investors can receive attractive
current income, as well as growth potential, offering some protection against
inflation. From time to time various advertisements, sales literature, reports
and other information furnished to current or prospective investors may present
the average annual compounded rate of return of selected asset classes over
various periods of time, compared to the rate of inflation over the same
periods.

EXCHANGE OPTION--MUNICIPAL INVESTMENT TRUST FUND ONLY.

You may exchange Fund Units for units of certain other Defined Asset Funds
subject only to a reduced sales charge. You may exchange your units of any
Municipal Investment Trust Fund Intermediate Term Series with a regular maximum
sales charge of at least 3.25%, of any other Defined Asset Fund with a regular
maximum sales charge of at least 3.50%, or of any unaffiliated unit trust with a
regular maximum sales charge of at least 3.0%, for Units of this Fund at their
relative net asset values, subject only to a reduced sales charge, or to any
remaining Deferred Sales Charge, as applicable.

To make an exchange, you should contact your financial professional to find
out what suitable Exchange Funds are available and to obtain a prospectus. You
may acquire units of only those Exchange Funds in which the Sponsors are
maintaining a secondary market and which are lawfully for sale in the state
where you reside. Except for the reduced sales charge, an exchange is a taxable
event normally requiring recognition of any gain or loss on the units exchanged.
However, the Internal Revenue Service may seek to disallow a loss if the
portfolio of the units acquired is not materially different from the portfolio
of the units exchanged; you should consult your own tax advisor. If the proceeds
of units exchanged are insufficient to acquire a whole number of Exchange Fund
units, you may pay the difference in cash (not exceeding the price of a single
unit acquired).

As the Sponsors are not obligated to maintain a secondary market in any
series, there can be no assurance that units of a desired series will be
available for exchange. The Exchange Option may be amended or terminated at any
time without notice.

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<PAGE>
SUPPLEMENTAL INFORMATION

Upon writing or calling the Trustee shown on the back cover of Part A of
this Prospectus, investors will receive at no cost to the investor supplemental
information about the Fund, which has been filed with the SEC. The supplemental
information includes more detailed risk factor disclosure about the types of
Bonds that may be part of the Fund's Portfolio, general risk disclosure
concerning any letters of credit or insurance securing certain Bonds, and
general information about the structure and operation of the Fund.

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<PAGE>
APPENDIX A

DESCRIPTION OF RATINGS (AS DESCRIBED BY THE RATING COMPANIES THEMSELVES)

STANDARD & POOR'S RATINGS GROUP, A DIVISION OF MCGRAW-HILL, INC.

AAA--Debt rated AAA has the highest rating assigned by Standard & Poor's.
Capacity to pay interest and repay principal is extremely strong.

AA--Debt rated AA has a very strong capacity to pay interest and repay
principal and differs from the highest rated issues only in small degree.

A--Debt rated A has a strong capacity to pay interest and repay principal
although it is somewhat more susceptible to the adverse effects of changes in
circumstances and economic conditions than debt in higher rated categories.

BBB--Debt rated BBB is regarded as having an adequate capacity to pay
interest and repay principal. Whereas it normally exhibits adequate protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to pay interest and repay principal for
debt in this category than in higher rated categories.

BB, B, CCC, CC--Debt rated BB, B, CCC and CC is regarded, on balance, as
predominately speculative with respect to capacity to pay interest and repay
principal in accordance with the terms of the obligation. BB indicates the
lowest degree of speculation and CC the highest degree of speculation. While
such debt will likely have some quality and protective characteristics, these
are outweighed by large uncertainties or major risk exposures to adverse
conditions.

The ratings from AA to CCC may be modified by the addition of a plus or
minus sign to show relative standing within the major rating categories.

A provisional rating, indicated by 'p' following a rating, assumes the
successful completion of the project being financed by the issuance of the debt
being rated and indicates that payment of debt service requirements is largely
or entirely dependent upon the successful and timely completion of the project.
This rating, however, while addressing credit quality subsequent to completion
of the project, makes no comment on the likelihood of, or the risk of default
upon failure of, such completion.

* Continuance of the rating is contingent upon S&P's receipt of an executed
copy of the escrow agreement or closing documentation confirming investments and
cash flows.

NR--Indicates that no rating has been requested, that there is insufficient
information on which to base a rating or that Standard & Poor's does not rate a
particular type of obligation as a matter of policy.

MOODY'S INVESTORS SERVICE, INC.

Aaa--Bonds which are rated Aaa are judged to be the best quality. They
carry the smallest degree of investment risk and are generally referred to as
'gilt edge'. Interest payments are protected by a large or by an exceptionally
stable margin and principal is secure. While the various protective elements are
likely to change, such changes as can be visualized are most unlikely to impair
the fundamentally strong position of such issues.

Aa--Bonds which are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what are generally known as
high grade bonds. They are rated lower than the best bonds because margins of
protection may not be as large as in Aaa securities or fluctuation of protective
elements may be of greater amplitude or there may be other elements present
which make the long-term risks appear somewhat larger than in Aaa securities.

A--Bonds which are rated A possess many favorable investment attributes and
are to be considered as upper medium grade obligations. Factors giving security
to principal and interest are considered adequate, but elements may be present
which suggest a susceptibility to impairment sometime in the future.

Baa--Bonds which are rated Baa are considered as medium grade obligations,
i.e., they are neither highly protected nor poorly secured. Interest payments
and principal security appear adequate for the present but certain protective
elements may be lacking or may be characteristically unreliable over any great
length of time. Such bonds lack outstanding investment characteristics and in
fact have speculative characteristics as well.

Ba--Bonds which are rated Ba are judged to have speculative elements; their
future cannot be considered as well assured. Often the protection of interest
and principal payments may be very moderate, and thereby not well safeguarded

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during both good and bad times over the future. Uncertainty of position
characterizes bonds in this class.

B--Bonds which are rated B generally lack characteristics of the desirable
investment. Assurance of interest and principal payments or of maintenance of
other terms of the contract over any long period of time may be small.

Rating symbols may include numerical modifiers 1, 2 or 3. The numerical
modifier 1 indicates that the security ranks at the high end, 2 in the
mid-range, and 3 nearer the low end, of the generic category. These modifiers of
rating symbols give investors a more precise indication of relative debt quality
in each of the historically defined categories.

Conditional ratings, indicated by 'Con.', are sometimes given when the
security for the bond depends upon the completion of some act or the fulfillment
of some condition. Such bonds are given a conditional rating that denotes their
probable credit stature upon completion of that act or fulfillment of that
condition.

NR--Should no rating be assigned, the reason may be one of the following:
(a) an application for rating was not received or accepted; (b) the issue or
issuer belongs to a group of securities that are not rated as a matter of
policy; (c) there is a lack of essential data pertaining to the issue or issuer
or (d) the issue was privately placed, in which case the rating is not published
in Moody's publications.

FITCH INVESTORS SERVICE, INC.

AAA--These bonds are considered to be investment grade and of the highest
quality. The obligor has an extraordinary ability to pay interest and repay
principal, which is unlikely to be affected by reasonably foreseeable events.

AA--These bonds are considered to be investment grade and of high quality.
The obligor's ability to pay interest and repay principal, while very strong, is
somewhat less than for AAA rated securities or more subject to possible change
over the term of the issue.

A--These bonds are considered to be investment grade and of good quality.
The obligor's ability to pay interest and repay principal is considered to be
strong, but may be more vulnerable to adverse changes in economic conditions and
circumstances than bonds with higher ratings.

BBB--These bonds are considered to be investment grade and of satisfactory
quality. The obligor's ability to pay interest and repay principal is considered
to be adequate. Adverse changes in economic conditions and circumstances,
however are more likely to weaken this ability than bonds with higher ratings.

A '+' or a '-' sign after a rating symbol indicates relative standing in
its rating.

DUFF & PHELPS CREDIT RATING CO.

AAA--Highest credit quality. The risk factors are negligible, being only
slightly more than for risk-free U.S. Treasury debt.

AA--High credit quality. Protection factors are strong. Risk is modest but
may vary slightly from time to time because of economic condtions.

A--Protection factors are average but adequate. However, risk factors are
more variable and greater in periods of economic stress.

A '+' or a '-' sign after a rating symbol indicates relative standing in
its rating.

a-2
<PAGE>
APPENDIX B
SALES CHARGE SCHEDULES FOR DEFINED ASSET FUNDS, MUNICIPAL SERIES

DEFERRED AND UP-FRONT SALES CHARGES. Units purchased during the first year
of the Fund will be subject to periodic deferred and contingent deferred sales
charges. Units purchased in the second through fifth year will be subject to an
up-front sales charge as well as periodic deferred and contingent deferred sales
charges. Units purchased thereafter will be subject only to an up-front sales
charge. During the first five years of the Fund, a fixed periodic deferred sales
charge of $2.75 per Unit is payable on 20 quarterly payment dates occurring on
the 10th day of February, May, August and November, commencing no earlier than
45 days after the initial date of deposit. Investors purchasing Units on the
initial date of deposit and holding for at least five years, for example, would
incur total periodic deferred sales charges of $55.00 per Unit. Because of the
time value of money, however, as of the initial date of deposit this periodic
deferred sales charge obligation would, at current interest rates, equate to an
up-front sales charge of approximately 4.75%.

The Public Offering Price subsequent to the Initial Date of Deposit will
fluctuate. As the periodic deferred sales charge is a fixed dollar amount
irrespective of the Public Offering Price, it will represent a varying
percentage of the Public Offering Price. An up-front sales charge will be
imposed on all unit purchases after the first year of the Fund. The following
table illustrates the combined maximum up-front and periodic deferred sales
charges that would be incurred by an investor who purchases Units at the
beginning of each of the first five years of the Fund (based on a constant Unit
price) and holds them through the fifth year of the Fund:

<TABLE><CAPTION>
TOTAL
UP-FRONT SALES CHARGE MAXIMUM UP-FRONT AND PERIODIC
----------------------------------------------------------- AMOUNT DEFERRED SALES
YEAR OF UNIT AS PERCENT OF PUBLIC AS PERCENT OF NET AMOUNT PER DEFERRED PER CHARGES
PURCHASE OFFERING PRICE AMOUNT INVESTED $1,000 INVESTED $1,000 INVESTED PER $1,000 INVESTED
- ------------------- --------------------- ------------------- --------------- --------------- ---------------------
<S> <C> <C> <C> <C> <C>
1 None None None $ 55.00 $ 55.00
2 1.10% 1.11% $ 11.00 44.00 55.00
3 2.20 2.25 22.00 33.00 55.00
4 3.30 3.41 33.00 22.00 55.00
5 4.40 4.60 44.00 11.00 55.00
</TABLE>

CONTINGENT DEFERRED SALES CHARGE. Units redeemed or repurchased within 4
years after the Fund's initial date of deposit will not only incur the periodic
deferred sales charge until the quarter of redemption or repurchase but will
also be subject to a contingent deferred sales charge:

YEAR SINCE FUND'S
INITIAL DATE OF CONTINGENT DEFERRED
DEPOSIT SALES CHARGE PER UNIT
--------------------- ---------------------
1 $ 25.00
2 15.00
3 10.00
4 5.00
5 and thereafter None

The contingent deferred sales charge is waived on any redemption or
repurchase of Units after the death (including the death of a single joint
tenant with rights of survivorship) or disability (as defined in the Internal
Revenue Code) of an investor, provided the redemption or repurchase is requested
within one year of the death or initial determination of disability. The
Sponsors may require receipt of satisfactory proof of disability before
releasing the portion of the proceeds representing the amount of the contingent
deferred sales charge waived.

To assist investors in understanding the total costs of purchasing units
during the first four years of the Fund and disposing of those units by the
fifth year, the following tables set forth the maximum combined up-front,
periodic and contingent deferred sales charges that would be incurred (assuming
a constant Unit price) by an investor:
<TABLE><CAPTION>
UNITS PURCHASED ON INITIAL OFFERING DATE

YEAR OF UNIT DEFERRED SALES CONTINGENT DEFERRED
DISPOSITION UP-FRONT SALES CHARGE CHARGE SALES CHARGE TOTAL SALES CHARGES
- ------------------- --------------------- ----------------- ------------------- -------------------
<S> <C> <C> <C> <C>
1 None $ 11.00 $ 25.00 $ 36.00
2 None 22.00 15.00 37.00
3 None 33.00 10.00 43.00
4 None 44.00 5.00 49.00
5 None 55.00 0.00 55.00

b-1
<PAGE>
<CAPTION>
UNITS PURCHASED ON FIRST ANNIVERSARY OF FUND

YEAR OF UNIT DEFERRED SALES CONTINGENT DEFERRED
DISPOSITION UP-FRONT SALES CHARGE CHARGE SALES CHARGE TOTAL SALES CHARGES
- ------------------- --------------------- ----------------- ------------------- -------------------
<S> <C> <C> <C> <C>
2 $ 11.00 $ 11.00 $ 15.00 $ 37.00
3 11.00 22.00 10.00 43.00
4 11.00 33.00 5.00 49.00
5 11.00 44.00 0.00 55.00

<CAPTION>
UNITS PURCHASED ON SECOND ANNIVERSARY OF FUND

YEAR OF UNIT DEFERRED SALES CONTINGENT DEFERRED
DISPOSITION UP-FRONT SALES CHARGE CHARGE SALES CHARGE TOTAL SALES CHARGES
- ------------------- --------------------- ----------------- ------------------- -------------------
<S> <C> <C> <C> <C>
3 $ 22.00 $ 11.00 $ 10.00 $ 43.00
4 22.00 22.00 5.00 49.00
5 22.00 33.00 0.00 55.00

<CAPTION>
UNITS PURCHASED ON THIRD ANNIVERSARY OF FUND

YEAR OF UNIT DEFERRED SALES CONTINGENT DEFERRED
DISPOSITION UP-FRONT SALES CHARGE CHARGE SALES CHARGE TOTAL SALES CHARGES
- ------------------- --------------------- ----------------- ------------------- -------------------
<S> <C> <C> <C> <C>
4 $ 33.00 $ 11.00 $ 5.00 $ 49.00
5 33.00 22.00 0.00 55.00

<CAPTION>
UNITS PURCHASED ON FOURTH ANNIVERSARY OF FUND

</TABLE>
b-2
<PAGE>
APPENDIX C
SALES CHARGE SCHEDULES FOR MUNICIPAL INVESTMENT TRUST FUND
INITIAL OFFERING

<TABLE><CAPTION>
SALES CHARGE
(GROSS UNDERWRITING PROFIT)
----------------------------------
AS PERCENT OF AS PERCENT OF DEALER CONCESSION AS PRIMARY MARKET
OFFER SIDE PUBLIC NET AMOUNT PERCENT OF PUBLIC CONCESSION TO
NUMBER OF UNITS OFFERING PRICE INVESTED OFFERING PRICE INTRODUCING DEALERS
- ----------------------------------- ------------------- ------------- --------------------- -------------------
<S> <C> <C> <C> <C>

MONTHLY PAYMENT SERIES, MULTISTATE SERIES, INSURED SERIES

Less than 250...................... 4.50% 4.712% 2.925% $ 32.40
250 - 499.......................... 3.50 3.627 2.275 25.20
500 - 749.......................... 3.00 3.093 1.950 21.60
750 - 999.......................... 2.50 2.564 1.625 18.00
1,000 or more...................... 2.00 2.041 1.300 14.40

<CAPTION>
INTERMEDIATE SERIES (TEN YEAR MATURITIES)

<S> <C> <C> <C> <C>
Less than 250...................... 4.00% 4.167% 2.600% $ 28.80
250 - 499.......................... 3.00 3.093 1.950 21.60
500 - 749.......................... 2.50 2.564 1.625 18.00
750 - 999.......................... 2.00 2.041 1.300 14.40
1,000 or more...................... 1.50 1.523 0.975 10.00

<CAPTION>
INTERMEDIATE SERIES (SHORT INTERMEDIATE MATURITIES)

<S> <C> <C> <C> <C>
Less than 250...................... 2.75% 2.828% 1.788% $ 19.80
250 - 499.......................... 2.25 2.302 1.463 16.20
500 - 749.......................... 1.75 1.781 1.138 12.60
750 - 999.......................... 1.25 1.266 0.813 9.00
1,000 or more...................... 1.00 1.010 0.650 7.20

<CAPTION>
SECONDARY MARKET

ACTUAL SALES CHARGE AS DEALER CONCESSION AS
PERCENT OF EFFECTIVE PERCENT OF EFFECTIVE
NUMBER OF UNITS SALES CHARGE SALES CHARGE
- ----------------- ------------------------- -------------------------
<S> <C> <C>
1-249 100% 65%
250-499 80 52
500-749 60 39
750-999 45 29.25
1,000 or more 35 22.75

<CAPTION>
EFFECTIVE SALES CHARGE

AS PERCENT AS PERCENT
TIME TO OF BID SIDE OF PUBLIC
MATURITY EVALUATION OFFERING PRICE
- ---------------------------- ------------- -----------------
<S> <C> <C>
Less than six months 0% 0%
Six months to 1 year 0.756 0.75
Over 1 year to 2 years 1.523 1.50
Over 2 years to 4 years 2.564 2.50
Over 4 years to 8 years 3.627 3.50
Over 8 years to 15 years 4.712 4.50
Over 15 years 5.820 5.50
</TABLE>

For this purpose, a Bond will be considered to mature on its stated
maturity date unless it has been called for redemption or funds or securities
have been placed in escrow to redeem it on an earlier date, or is subject to a
mandatory tender, in which case the earlier date will be considered the maturity
date.

c-1
<PAGE>

PROSPECTUS FORMAT

This prospectus consists of a Part A, this Part B and for certain State
Trusts, an additional Part C. The Prospectus does not contain all of the
information with respect to the investment company set forth in its registration
statement and exhibits relating thereto which have been filed with the
Securities and Exchange Commission, Washington, D.C. under the Securities Act of
1933 and the Investment Company Act of 1940, and to which reference is hereby
made.

No person is authorized to give any information or to make any
representations with respect to this investment company not contained in the
registration statement and related exhibits; and any information or
representation not contained therein must not be relied upon as having been
authorized. The Prospectus does not constitute an offer to sell, or a
solicitation of any offer to buy, securities in any state to any person to whom
it is not lawful to make such offer in such state.

15900--11/95

<PAGE>

SUPPLEMENT DATED JANUARY 16, 1996 TO PROSPECTUSES OF ALL
MUNICIPAL INVESTMENT TRUST FUND SERIES OTHER THAN PUT SERIES.

Effective immediately the Effective Sales Charge for secondary market purchases
of units of these Series will be computed as follows:

AS PERCENT AS PERCENT
TIME TO OF BID SIDE OF PUBLIC
MATURITY EVALUATION OFFERING PRICE
-------- ----------- --------------

Less than six months 0% 0%
Six months to less than 1 year 0.503 0.50
1 year to less than 2 years 1.010 1.00
2 years to less than 3 years 1.523 1.50
3 years to less than 4 years 2.302 2.25
4 years to less than 5 years 2.828 2.75
5 years to less than 6 years 3.093 3.00
6 years to less than 7 years 3.359 3.25
7 years to less than 8 years 3.627 3.50
8 years to less than 9 years 4.167 4.00
9 years to less than 12 years 4.439 4.25
12 years to less than 15 years 4.712 4.50
15 years or more 5.820 5.50

For this purpose, a Bond will be considered to mature on its stated maturity
date unless: it has been called for redemption; (although not called) its
yield to maturity is more than 40 basis points higher than its yield to any
call date; funds or securities have been placed in escrow to redeem it on an
earlier date; or the Bond is subject to a mandatory tender. In each of these
cases the earlier date will be considered the maturity date.

<PAGE>
DEFINED
ASSET FUNDSSM

SPONSORS: MUNICIPAL STATE SERIES
Merrill Lynch, PROSPECTUS PART A
Pierce, Fenner & Smith Incorporated This Prospectus consists of a Part A and
Defined Asset Funds a Part B. The Prospectus does not
P.O. Box 9051 contain all of the information with
Princeton, N.J. 08543-9051 respect to the investment company set
(609) 282-8500 forth in its registration statement and
PaineWebber Incorporated exhibits relating thereto which have
1200 Harbor Boulevard been filed with the Securities and
Weehawken, N.J. 07087 Exchange Commission, Washington, D.C.
(201) 902-3000 under the Securities Act of 1933 and the
EVALUATOR: Investment Company Act of 1940, and to
Kenny S&P Evaluation Services, which reference is hereby made.
a division of J. J. Kenny Co., Inc. No person is authorized to give any
65 Broadway information or to make any
New York, N.Y. 10006 representations with respect to this
TRUSTEE: investment company not contained in its
The Chase Manhattan Bank, N.A. registration statement and exhibits
(a National Banking Association) relating thereto; and any information or
Customer Service Retail Department representation not contained therein
770 Broadway--7th Floor must not be relied upon as having been
New York, N.Y. 10003-9598 authorized. This Prospectus does not
1-800-323-1508 constitute an offer to sell, or a
solicitation of an offer to buy,
securities in any state to any person to
whom it is not lawful to make such offer
in such state.

15095--6/96
<PAGE>
DEFINED ASSET FUNDS--
MUNICIPAL STATE SERIES
CONTENTS OF REGISTRATION STATEMENT

This Post-Effective Amendment to the Registration Statement on Form S-6
comprises the following papers and documents:

The facing sheet of Form S-6.

The cross-reference sheet (incorporated by reference to the Cross-Reference
Sheet to the Registration Statement of Defined Asset Funds Municipal Insured
Series, 1933 Act File No. 33-54565).

The Prospectus.

The Signatures.

The following exhibits:

1.1.1--Form of Standard Terms and Conditions of Trust Effective as of
October 21, 1993 (incorporated by reference to Exhibit 1.1.1 to the
Registration Statement of Municipal Investment Trust Fund,
Multistate Series--48, 1933 Act File No. 33-50247).

4.1 --Consent of the Evaluator.

5.1 --Consent of independent accountants.

9.1 --Information Supplement (incorporated by reference to Exhibit 9.1 to
the Registration Statement of Municipal Investment Trust Fund,
Multistate Series--207, 1933 Act File No. 333-02659).

R-1
<PAGE>
DEFINED ASSET FUNDS--
MUNICIPAL STATE SERIES

SIGNATURES

PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT,
DEFINED ASSET FUNDS--MUNICIPAL STATE SERIES, CERTIFIES THAT IT MEETS ALL OF THE
REQUIREMENTS FOR EFFECTIVENESS OF THIS REGISTRATION STATEMENT PURSUANT TO RULE
485(B) UNDER THE SECURITIES ACT OF 1933 AND HAS DULY CAUSED THIS REGISTRATION
STATEMENT OR AMENDMENT TO THE REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF
BY THE UNDERSIGNED THEREUNTO DULY AUTHORIZED IN THE CITY OF NEW YORK AND STATE
OF NEW YORK ON THE 5TH DAY OF JUNE, 1996.

SIGNATURES APPEAR ON PAGES R-3 AND R-4.

A majority of the members of the Board of Directors of Merrill Lynch,
Pierce, Fenner & Smith Incorporated has signed this Registration Statement or
Amendment to the Registration Statement pursuant to Powers of Attorney
authorizing the person signing this Registration Statement or Amendment to the
Registration Statement to do so on behalf of such members.

A majority of the members of the Executive Committee of the Board of
Directors of PaineWebber Incorporated has signed this Registration Statement or
Amendment to the Registration Statement pursuant to Powers of Attorney
authorizing the person signing this Registration Statement or Amendment to the
Registration Statement to do so on behalf of such members.

R-2
<PAGE>
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
DEPOSITOR

By the following persons, who constitute a majority of Powers of Attorney
the Board of Directors of Merrill Lynch, Pierce, have been filed
Fenner & Smith Incorporated: under
Form SE and the
following 1933 Act
File
Number: 33-43466
and 33-51607

HERBERT M. ALLISON, JR.
BARRY S. FREIDBERG
EDWARD L. GOLDBERG
STEPHEN L. HAMMERMAN
JEROME P. KENNEY
DAVID H. KOMANSKY
DANIEL T. NAPOLI
THOMAS H. PATRICK
JOHN L. STEFFENS
DANIEL P. TULLY
ROGER M. VASEY
ARTHUR H. ZEIKEL
By
ERNEST V. FABIO
(As authorized signatory for Merrill Lynch, Pierce,
Fenner & Smith Incorporated and
Attorney-in-fact for the persons listed above)

R-3
<PAGE>
PAINEWEBBER INCORPORATED
DEPOSITOR

By the following persons, who constitute Powers of Attorney have been filed
a majority of under
the Executive Committee of the Board the following 1933 Act File
of Directors of PaineWebber Number: 33-55073
Incorporated:

JOSEPH J. GRANO, JR.
DONALD B. MARRON
By
ROBERT E. HOLLEY
(As authorized signatory for
PaineWebber Incorporated
and Attorney-in-fact for the persons listed above)

R-4

<PAGE>
EXHIBIT 4.1

KENNY S&P EVALUATION SERVICES
A DIVISION OF J. J. KENNY CO., INC.
65 BROADWAY
NEW YORK, N.Y. 10006-2551
TELEPHONE (212) 770-4422
FAX 212/797-8681

June 5, 1996

Frank A. Ciccotto
Vice President

Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Unit Investment Trust Division
P.O. Box 9051
Princeton, New Jersey 08543-9051
The Chase Manhattan Bank, N.A.
1 Chase Manhattan Plaza--3B
New York, New York 10081

RE: DEFINED ASSET FUNDS--MUNICIPAL INVESTMENT TRUST FUND,
MULTISTATE SERIES--1

Gentlemen:

We have examined the post-effective Amendment to the Registration Statement
File No. 33-58571 for the above-captioned trust. We hereby acknowledge that
Kenny S&P Evaluation Services, a division of J. J. Kenny Co., Inc. is currently
acting as the evaluator for the trust. We hereby consent to the use in the
Amendment of the reference to Kenny S&P Evaluation Services, a division of J. J.
Kenny Co., Inc. as evaluator.

In addition, we hereby confirm that the ratings indicated in the
above-referenced Amendment to the Registration Statement for the respective
bonds comprising the trust portfolio are the ratings currently indicated in our
KENNYBASE database.

You are hereby authorized to file copies of this letter with the Securities
and Exchange Commission.

Sincerely,
FRANK A. CICCOTTO

<PAGE>
Exhibit 5.1
CONSENT OF INDEPENDENT ACCOUNTANTS
The Sponsors and Trustee of
Defined Asset Funds, Municipal State Series (California and Pennsylvania
Trusts):

We consent to the use in this Post-Effective Amendment No. 1 to Registration
Statement No. 33-58571 of our opinion dated May 20, 1996 appearing in the
Prospectus, which is part of such Registration Statement, and to the reference
to us under the heading 'Miscellaneous--Auditors' in such Prospectus.

DELOITTE & TOUCHE LLP
New York, N.Y.
June 5, 1996

<ARTICLE> 6
<SERIES>
<NUMBER> 1
<NAME> PENNSYLVANIA TRUST

<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> MAR-31-1996
<PERIOD-END> MAR-31-1996
<INVESTMENTS-AT-COST> 4,796,968
<INVESTMENTS-AT-VALUE> 4,838,734
<RECEIVABLES> 73,970
<ASSETS-OTHER> 51,739
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 4,964,443
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 56,415
<TOTAL-LIABILITIES> 56,415
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 4,850,846
<SHARES-COMMON-STOCK> 4,877
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 15,416
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 41,766
<NET-ASSETS> 4,908,028
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 262,479
<OTHER-INCOME> 0
<EXPENSES-NET> 4,833
<NET-INVESTMENT-INCOME> 257,646
<REALIZED-GAINS-CURRENT> (248)
<APPREC-INCREASE-CURRENT> 41,766
<NET-CHANGE-FROM-OPS> 299,164
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 222,489
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 36,439
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0

</TABLE>

<ARTICLE> 6
<SERIES>
<NUMBER> 2
<NAME> CALIFORNIA TRUST

<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> MAR-31-1996
<PERIOD-END> MAR-31-1996
<INVESTMENTS-AT-COST> 5,708,221
<INVESTMENTS-AT-VALUE> 5,755,272
<RECEIVABLES> 89,382
<ASSETS-OTHER> 60,834
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 5,905,488
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 68,572
<TOTAL-LIABILITIES> 68,572
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 5,771,580
<SHARES-COMMON-STOCK> 5,803
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 18,285
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 47,051
<NET-ASSETS> 5,836,916
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 317,549
<OTHER-INCOME> 0
<EXPENSES-NET> 9,498
<NET-INVESTMENT-INCOME> 308,051
<REALIZED-GAINS-CURRENT> (426)
<APPREC-INCREASE-CURRENT> 47,051
<NET-CHANGE-FROM-OPS> 354,676
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 266,416
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 40,386
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0

</TABLE>

<PAGE>
DAVIS POLK & WARDWELL
450 LEXINGTON AVENUE
NEW YORK, NEW YORK 10017
(212) 450-4000

June 5, 1996

Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549

Dear Sirs:

We hereby represent that the Post-Effective Amendments to the registered
unit investment trusts described in Exhibit A attached hereto do not contain
disclosures which would render them ineligible to become effective pursuant to
Rule 485(b) under the Securities Act of 1933.

Very truly yours,

Davis Polk & Wardwell

Attachment

<PAGE>

EXHIBIT A
<TABLE>
<CAPTION>

1933 ACT 1940 ACT
FUND NAME CIK FILE NO. FILE NO.
- --------- --- -------- --------
<S> <C> <C> <C>

DEFINED ASSET FUNDS-MUNICIPAL STATE SERIES 943818 33-58571 811-2537

DEFINED ASSET FUNDS- MPUSTS-19 DAF 893113 33-52793 811-2810

DEFINED ASSET FUNDS-CIF IS-13 843855 33-41741 811-2295

DEFINED ASSET FUNDS-MITF IS-190 803872 33-49385 811-1777

DEFINED ASSET FUNDS-MITF ITS-188 868152 33-45754 811-1777
DEFINED ASSET FUNDS-MITF ITS-189 868153 33-46271 811-1777
DEFINED ASSET FUNDS- ITS-204 DAF 868111 33-49239 811-1777
DEFINED ASSET FUNDS- ITS-228 DAF 910374 33-52455 881-1777
DEFINED ASSET FUNDS- ITS-229 DAF 910375 33-52457 811-1777
DEFINED ASSET FUNDS- ITS-251 DAF 924343 33-57805 811-1777

DEFINED ASSET FUNDS-CIF MPS-303 781791 33-36734 811-2295

DEFINED ASSET FUNDS-MITF MPS-478 803682 33-26500 811-1777

DEFINED ASSET FUNDS-MITF MSS 5K 836077 33-26060 811-1777
DEFINED ASSET FUNDS-MITF MSS 6S 847183 33-32912 811-1777
DEFINED ASSET FUNDS-MITF MSS 6U 847185 33-33380 811-1777
DEFINED ASSET FUNDS-MITF MSS 6V 847186 33-33850 811-1777
DEFINED ASSET FUNDS-MITF MSS 6X 847191 33-34030 811-1777

DEFINED ASSET FUNDS-MITF NYPUT-1 746574 2-91269 811-1777

TOTAL: 18 FUNDS

</TABLE>