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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES

Investment Company Act file number 811-5245

Dreyfus Strategic Municipals, Inc.
(Exact name of Registrant as specified in charter)

c/o The Dreyfus Corporation
200 Park Avenue
New York, New York 10166
(Address of principal executive offices) (Zip code)

Michael A. Rosenberg, Esq.
200 Park Avenue
New York, New York 10166
(Name and address of agent for service)

Registrant's telephone number, including area code:  (212) 922-6000 
Date of fiscal year end:  9/30   
Date of reporting period:  3/31/09   

FORM N-CSR

Item 1. Reports to Stockholders.

 



Contents

  THE FUND 
2  A Letter from the CEO 
3  Discussion of Fund Performance 
6  Statement of Investments 
26  Statement of Assets and Liabilities 
27  Statement of Operations 
28  Statement of Changes in Net Assets 
29  Financial Highlights 
31  Notes to Financial Statements 
39  Information About the Review and Approval 
   of the Fund’s Management Agreement 
45  Officers and Directors 

FOR MORE INFORMATION 
Back Cover 

Dreyfus
Strategic Municipals, Inc.

The Fund


A LETTER FROM THE CEO

Dear Shareholder:

We present this semiannual report for Dreyfus Strategic Municipals, Inc., covering the six-month period from October 1, 2008, through March 31, 2009.

The reporting period has been one of the most challenging for the U.S. economy and financial markets, including many areas of the municipal bond markets.An economic downturn was severely exacerbated in mid-September 2008, when the bankruptcy of Lehman Brothers triggered a cascading global economic decline. As the credit crisis dried up the availability of funding for businesses and consumers, international trade activity slumped, commodity prices plummeted, the U.S. and global economies entered a period of intense inventory liquidation, and unemployment surged.

On the heels of a –6.3% annualized U.S. economic growth rate in the fourth quarter of 2008, we expect another sharp decline for the first quarter of 2009. However, our Chief Economist anticipates that the U.S. recession may reach a trough around the third quarter of this year, followed by a slow recovery. Indeed, the U.S. government and monetary authorities have signaled their intent to do whatever it takes to forestall a depression or a deflationary spiral, including historically low interest rates, mortgage modification programs and massive monetary and fiscal stimulus and support for state and local municipalities. Although times seem dire now, we believe it is always appropriate to maintain a long-term investment focus and to discuss any investment modifications with your financial adviser.Together, you can prepare for the risks that lie ahead and position your assets to perform in this current market downturn, and in the future.

For information about how the fund performed during the reporting period, as well as market perspectives, we have provided a Discussion of Fund Performance given by the fund’s Portfolio Manager.

As always, we thank you for your continued confidence and support.


Jonathan R. Baum
Chairman and Chief Executive Officer
The Dreyfus Corporation
April 15, 2009

2


DISCUSSION OF FUND PERFORMANCE

For the period of October 1, 2008, through March 31, 2009, as provided by James Welch, Senior Portfolio Manager

Fund and Market Performance Overview

For the six-month period ended March 31, 2009, Dreyfus Strategic Municipals achieved a total return of –4.30% on a net-asset-value basis.1 Over the same period, the fund provided aggregate income dividends of $0.252 per share, which reflects an annualized distribution rate of 7.59%.2

Municipal bonds suffered bouts of poor liquidity and heightened volatility due to a severe financial crisis and economic downturn during the reporting period. Although the fund’s income stream held up relatively well, the fund’s lower-rated holdings proved to be a drag on its total return, especially during the fourth quarter of 2008.

The Fund’s Investment Approach

The fund’s investment objective is to maximize current income exempt from federal income tax to the extent consistent with the preservation of capital. Under normal market conditions, the fund invests at least 80% of its net assets in municipal obligations. Generally, the fund invests at least 50% of its net assets in municipal bonds considered investment grade or the unrated equivalent as determined by Dreyfus in the case of bonds, and in the two highest-rating categories or the unrated equivalent as determined by Dreyfus in the case of short-term obligations having or deemed to have maturities of less than one year.

To this end, we have constructed a portfolio derived from seeking income opportunities through analysis of each bond’s structure, including paying close attention to each bond’s yield, maturity and early redemption features.

Over time, many of the fund’s relatively higher-yielding bonds mature or may be called by their issuers, and we generally attempt to replace those bonds, as opportunities arise, with investments consistent with the fund’s investment policies at prevailing current yields.When we believe

The Fund 3

  DISCUSSION OF FUND PERFORMANCE (continued)

an opportunity exists, we also may seek to upgrade the portfolio’s investments with newly issued bonds that, in our opinion, have better structural or income characteristics than existing holdings.

Financial Crisis and Recession Sparked Volatility

An intensifying credit crisis and a severe recession roiled most financial markets, including municipal bonds, over the reporting period. Slumping home values, surging unemployment and plunging consumer confidence contributed to one of the worst recessions since the Great Depression, putting pressure on the fiscal conditions of most states and municipalities. Meanwhile, just weeks before the start of the reporting period, an ongoing credit crunch escalated into a global financial crisis that punished a number of large financial institutions. These developments sparked a “flight to quality” in which investors fled riskier assets in favor of traditional safe havens, especially U.S.Treasury securities.As a result, for much of the reporting period, absolute tax-exempt yields were significantly higher than those of comparable taxable U.S.Treasury securities.

Market turmoil was particularly severe over the fourth quarter of 2008, when highly leveraged institutional investors were forced to sell creditworthy investments, including municipal bonds, to meet margin calls and redemption requests. In addition, several major bond insurers suffered massive sub-prime related losses, causing investors to question the value of insurance on municipal bonds. Lower-rated bonds declined sharply in this environment.

Market conditions improved during the first quarter of 2009, and a number of municipal bonds that had suffered severe declines earlier in the reporting period regained a significant portion of their value in the second half. Investors apparently refocused on underlying credit fundamentals and began to look forward to the potentially beneficial effects of massive monetary and fiscal stimulus programs from the Federal Reserve Board and U.S. government.

Lower-Rated Bonds Dampened Performance

Whenever market liquidity allowed in this tumultuous market environment, we attempted to upgrade the fund’s credit profile by reducing its

4

positions in lower-rated municipal bonds in favor of higher-quality general-obligation bonds and essential-purpose revenue bonds. Indeed, new purchases of essential-purpose bonds fared relatively well over the reporting period.On the other hand,the fund’s holdings of bonds backed by the states’ settlement of litigation with U.S. tobacco companies hurt the relative performance, partly due to supply-and-demand factors.

Finally, the fund’s leveraging strategy exacerbated the effects of falling bond prices over the reporting period’s first half, but helped boost its current income stream and participation in the second-half rally as the cost of obtaining financing declined along with short-term interest rates. Rates on the fund’s auction-rate preferred shares, which are issued to fund its leveraging strategy, fell to low levels despite dislocations in the auction-rate securities market.

Maintaining a Cautious Investment Posture

As of the reporting period’s end, the U.S. economy has remained weak, and the financial crisis has persisted. Consequently, we have continued our attempts to upgrade the fund’s credit profile in anticipation of heightened market volatility over the foreseeable future. Over the longer term, however, we believe that low valuations, high yields relative to taxable U.S. government securities, and the likelihood of rising federal and state taxes make municipal bonds an attractive asset class.

April 15, 2009

1  Total return includes reinvestment of dividends and any capital gains paid, based upon net asset 
  value per share. Past performance is no guarantee of future results. Market price per share, net asset 
  value per share and investment return fluctuate. Income may be subject to state and local taxes, 
  and some income may be subject to the federal alternative minimum tax (AMT) for certain 
  investors. Capital gains, if any, are fully taxable. Return figure provided reflects the absorption of 
  certain fund expenses by The Dreyfus Corporation pursuant to an agreement in effect until 
  October 31, 2009, at which time it may be extended, modified or terminated. Had these 
  expenses not been absorbed, the fund’s return would have been lower. 
2  Annualized distribution rate per share is based upon dividends per share paid from net investment 
  income during the period, divided by the market price per share at the end of the period. 

The Fund 5

STATEMENT OF INVESTMENTS

March 31, 2009 (Unaudited)

Long-Term Municipal  Coupon  Maturity  Principal     
 Investments—161.8%  Rate (%)  Date  Amount ($)    Value ($) 
Alabama—1.9%           
Houston County Health Care           
   Authority, GO (Insured; AMBAC)  6.25  10/1/09  8,000,000  a  8,313,600 
Alaska—.9%           
Alaska Housing Finance           
   Corporation, General Mortgage           
   Revenue (Insured; MBIA, Inc.)  6.00  6/1/49  4,000,000    4,023,160 
Arizona—5.1%           
Arizona Housing Finance Authority,           
   SFMR (Mortgage-Backed           
   Securities Program)           
   (Collateralized: FHLMC,           
   FNMA and GNMA)  5.55  12/1/41  6,000,000    5,746,500 
Glendale Western Loop 101 Public           
   Facilities Corporation, Third           
   Lien Excise Tax Revenue  6.25  7/1/38  5,000,000    5,104,150 
Maricopa County Pollution Control           
   Corporation, PCR (Public           
   Service Company of New Mexico           
   Palo Verde Project)  5.75  11/1/22  6,000,000    4,695,060 
Scottsdale Industrial Development           
   Authority, HR (Scottsdale           
   Healthcare)  5.80  12/1/11  6,000,000  a  6,733,020 
Arkansas—.5%           
Arkansas Development           
   Finance Authority, SFMR           
   (Mortgage Backed Securities           
   Program) (Collateralized:           
   FNMA and GNMA)  6.25  1/1/32  2,255,000    2,294,169 
California—10.5%           
Beverly Hills Unified School           
   District, GO  0.00  8/1/30  10,850,000  b  3,291,673 
California,           
   GO  5.25  4/1/34  5,000    4,558 
California,           
   GO (Various Purpose)  6.50  4/1/33  10,000,000  c  10,556,600 
California Pollution Control           
   Financing Authority, SWDR           
   (Keller Canyon Landfill           
   Company Project)  6.88  11/1/27  2,000,000    1,913,140 

6

Long-Term Municipal  Coupon  Maturity  Principal     
 Investments (continued)  Rate (%)  Date  Amount ($)    Value ($) 
California (continued)           
California Statewide Communities           
   Development Authority,           
   Environmental Facilities Revenue           
   (Microgy Holdings Project)  9.00  12/1/38  3,000,000    2,383,320 
California Statewide Communities           
   Development Authority, Revenue           
   (Bentley School)  6.75  7/1/32  1,960,000    1,422,470 
California Statewide Communities           
   Development Authority,           
   Revenue (Daughters of           
   Charity Health System)  5.25  7/1/30  3,000,000    2,022,960 
California Statewide Communities           
   Development Authority,           
   Revenue (Daughters of           
   Charity Health System)  5.00  7/1/39  5,000,000    3,015,400 
California Statewide Communities           
   Development Authority, Student           
   Housing Revenue (CHF-Irvine,           
   LLC-UCI East Campus           
   Apartments, Phase II)  5.75  5/15/32  2,500,000    2,015,775 
Golden State Tobacco           
   Securitization Corporation,           
   Tobacco Settlement           
   Asset-Backed Bonds  7.80  6/1/13  8,100,000  a  9,849,276 
Golden State Tobacco           
   Securitization Corporation,           
   Tobacco Settlement           
   Asset-Backed Bonds  7.90  6/1/13  2,000,000  a  2,439,460 
Golden State Tobacco           
   Securitization Corporation,           
   Tobacco Settlement           
   Asset-Backed Bonds  5.00  6/1/33  5,775,000    3,343,263 
Golden State Tobacco           
   Securitization Corporation,           
   Tobacco Settlement           
   Asset-Backed Bonds  5.75  6/1/47  7,050,000    3,958,575 
Colorado—5.6%           
Beacon Point Metropolitan           
   District, GO  6.25  12/1/35  2,000,000    1,328,320 

The Fund 7

STATEMENT OF INVESTMENTS (Unaudited) (continued)

Long-Term Municipal  Coupon  Maturity  Principal     
 Investments (continued)  Rate (%)  Date  Amount ($)    Value ($) 
Colorado (continued)           
Colorado Educational and Cultural           
   Facilities Authority, Charter           
   School Revenue (American           
   Academy Project)  8.00  12/1/40  3,500,000    3,671,430 
Colorado Health Facilities           
   Authority, Revenue (American           
   Baptist Homes of the Midwest           
   Obligated Group)  5.90  8/1/37  3,000,000    1,870,620 
Colorado Health Facilities           
   Authority, Revenue (Poudre           
   Hospital) (Insured; FSA)  5.25  3/1/40  3,000,000    2,571,510 
Colorado Housing Finance           
   Authority, Single Family           
   Program Senior and Subordinate           
   Bonds (Collateralized; FHA)  6.60  8/1/32  1,445,000    1,500,156 
Northwest Parkway Public Highway           
   Authority, Revenue  7.13  6/15/11  10,550,000  a  11,274,574 
Southlands Metropolitan District           
   Number 1, GO  7.13  12/1/14  2,000,000  a  2,509,860 
Florida—5.1%           
Florida Housing Finance           
   Corporation, Housing Revenue           
   (Nelson Park Apartments)           
   (Insured; FSA)  6.40  3/1/40  12,380,000    12,500,953 
Jacksonville Economic Development           
   Commission, Health Care           
   Facilities Revenue (Florida           
   Proton Therapy Institute Project)  6.25  9/1/27  3,000,000  d  2,232,990 
Orange County Health Facilities           
   Authority, HR (Orlando           
   Regional Healthcare System)  6.00  10/1/09  45,000  a  46,682 
Orange County Health Facilities           
   Authority, HR (Orlando           
   Regional Healthcare System)  6.00  10/1/26  1,955,000    1,825,677 
Orange County School Board,           
   COP (Master Lease Purchase           
   Agreement) (Insured;           
   Assured Guaranty)  5.50  8/1/34  6,000,000    5,946,060 

8

Long-Term Municipal  Coupon  Maturity  Principal     
 Investments (continued)  Rate (%)  Date  Amount ($)    Value ($) 
Georgia—4.0%           
Brooks County Development           
   Authority, Senior Health and           
   Housing Facilities Revenue           
   (Presbyterian Home, Quitman, Inc.)           
   (Collateralized; GNMA)  5.70  1/20/39  4,445,000    4,413,040 
Fulton County Development           
   Authority, Revenue (Georgia           
   Tech North Avenue Apartments           
   Project) (Insured; XLCA)  5.00  6/1/32  2,500,000    2,374,850 
Georgia Higher Education           
   Facilities Authority,           
   Revenue (USG Real Estate           
   Foundation I, LLC Project)           
   (Insured; Assured Guaranty)  5.63  6/15/38  6,000,000    6,074,640 
Milledgeville-Baldwin County           
   Development Authority,           
   Revenue (Georgia College           
   and State Foundation)  6.00  9/1/13  2,090,000    2,467,663 
Milledgeville-Baldwin County           
   Development Authority,           
   Revenue (Georgia College           
   and State Foundation)  6.00  9/1/14  2,000,000  a  2,420,360 
Hawaii—.3%           
Hawaii Department of           
   Transportation, Special           
   Facility Revenue (Caterair           
   International Corporation)  10.13  12/1/10  1,600,000    1,530,928 
Idaho—1.0%           
Power County Industrial           
   Development Corporation, SWDR           
   (FMC Corporation Project)  6.45  8/1/32  5,000,000    4,281,450 
Illinois—11.0%           
Chicago,           
   GO (Insured; FGIC)  6.13  7/1/10  14,565,000  a  15,705,294 
Chicago,           
   SFMR (Collateralized: FHLMC,           
   FNMA and GNMA)  6.55  4/1/33  2,000,000    2,073,980 

The Fund 9

STATEMENT OF INVESTMENTS (Unaudited) (continued)

Long-Term Municipal  Coupon  Maturity  Principal     
 Investments (continued)  Rate (%)  Date  Amount ($)    Value ($) 
Illinois (continued)           
Chicago,           
   Wastewater Transmission           
   Revenue (Insured; MBIA, Inc.)  6.00  1/1/10  3,000,000  a  3,154,740 
Chicago O’Hare International           
   Airport, Special Facility           
   Revenue (American           
   Airlines, Inc. Project)  5.50  12/1/30  5,000,000    1,823,200 
Illinois Finance Authority,           
   Revenue (Edward Hospital           
   Obligated Group)           
   (Insured; AMBAC)  5.50  2/1/40  3,500,000    2,903,635 
Illinois Health Facilities           
   Authority, Revenue (Advocate           
   Health Care Network)  6.13  11/15/10  4,020,000  a  4,358,806 
Illinois Health Facilities           
   Authority, Revenue (OSF           
   Healthcare System)  6.25  11/15/09  7,730,000  a  8,071,048 
Illinois Health Facilities           
   Authority, Revenue (Swedish           
   American Hospital)  6.88  5/15/10  4,945,000  a  5,283,287 
Metropolitan Pier and Exposition           
   Authority, State Tax Revenue           
   (McCormick Place Expansion           
   Project) (Insured; MBIA, Inc.)  5.25  6/15/42  5,325,000    5,266,744 
Indiana—2.3%           
Franklin Township School           
   Building Corporation,           
   First Mortgage Bonds  6.13  7/15/10  6,500,000  a  7,084,480 
Petersburg,           
   SWDR (Indianapolis Power and           
   Light Company Project)  6.38  11/1/29  4,150,000    3,270,657 
Kansas—5.8%           
Kansas Development Finance           
   Authority, Health Facilities           
   Revenue (Sisters of Charity of           
   Leavenworth Health Services           
   Corporation)  6.25  12/1/28  3,000,000    3,027,120 
Sedgwick and Shawnee Counties,           
   SFMR (Mortgage-Backed           
   Securities Program)           
   (Collateralized: FNMA and GNMA)  6.30  12/1/32  3,325,000    3,373,512 

10

Long-Term Municipal  Coupon  Maturity  Principal   
 Investments (continued)  Rate (%)  Date  Amount ($)  Value ($) 
Kansas (continued)         
Sedgwick and Shawnee Counties,         
   SFMR (Mortgage-Backed         
   Securities Program)         
   (Collateralized: FNMA and GNMA)  6.45  12/1/33  6,760,000  7,065,552 
Sedgwick and Shawnee Counties,         
   SFMR (Mortgage-Backed         
   Securities Program)         
   (Collateralized: FNMA and GNMA)  5.70  12/1/35  1,895,000  1,789,164 
Wichita,         
   Hospital Facilities         
   Improvement Revenue (Via         
   Christi Health System, Inc.)  6.25  11/15/24  10,000,000  10,103,600 
Kentucky—1.8%         
Kentucky Area Development         
   Districts Financing Trust, COP         
   (Lease Acquisition Program)  5.50  5/1/27  2,000,000  1,838,540 
Louisville/Jefferson County Metro         
   Government, Health Facilities         
   Revenue (Jewish Hospital and Saint         
   Mary’s Healthcare, Inc. Project)  6.13  2/1/37  1,000,000  994,610 
Paducah Electric Plant Board,         
   Revenue (Insured;         
   Assured Guaranty)  5.25  10/1/35  5,000,000  4,971,650 
Louisiana—1.5%         
Lakeshore Villages Master         
   Community Development District,         
   Special Assessment Revenue  5.25  7/1/17  2,979,000  2,274,764 
Louisiana Local Government         
   Environmental Facilities and         
   Community Development         
   Authority, Revenue (Westlake         
   Chemical Corporation Projects)  6.75  11/1/32  7,000,000  4,550,420 
Maine—.6%         
Maine Housing Authority,         
   Mortgage Purchase Bonds  5.30  11/15/23  2,825,000  2,833,983 
Maryland—1.9%         
Maryland Community Development         
   Administration, Department of         
   Housing and Community         
   Development, Residential Revenue  5.75  9/1/37  2,265,000  2,262,667 

The Fund 11

STATEMENT OF INVESTMENTS (Unaudited) (continued)

Long-Term Municipal  Coupon  Maturity  Principal     
 Investments (continued)  Rate (%)  Date  Amount ($)    Value ($) 
Maryland (continued)           
Maryland Economic Development           
   Corporation, Senior Student           
   Housing Revenue (University of           
   Maryland, Baltimore Project)  5.75  10/1/33  4,590,000    2,669,865 
Maryland Economic Development           
   Corporation, Student Housing           
   Revenue (University of           
   Maryland, College Park Project)  6.50  6/1/13  3,000,000  a  3,585,060 
Massachusetts—1.6%           
Massachusetts Health and           
   Educational Facilities           
   Authority, Revenue (Civic           
   Investments Issue)  9.00  12/15/12  1,600,000  a  1,955,024 
Massachusetts Health and           
   Educational Facilities           
   Authority, Revenue (Partners           
   HealthCare System Issue)  5.75  7/1/32  185,000    185,007 
Massachusetts Industrial           
   Finance Agency, RRR           
   (Ogden Haverhill Project)  5.60  12/1/19  6,000,000    4,746,240 
Michigan—7.4%           
Charyl Stockwell Academy,           
   COP  5.90  10/1/35  2,580,000    1,690,287 
Detroit School District,           
   School Building and Site           
   Improvement Bonds (GO—           
   Unlimited Tax) (Insured; FGIC)  5.00  5/1/28  6,930,000    6,283,708 
Kent Hospital Finance Authority,           
   Revenue (Metropolitan           
   Hospital Project)  6.00  7/1/35  5,930,000    4,119,630 
Kent Hospital Finance Authority,           
   Revenue (Metropolitan           
   Hospital Project)  6.25  7/1/40  3,000,000    2,110,140 
Michigan Strategic Fund,           
   LOR (The Detroit Edison           
   Company Exempt Facilities           
   Project) (Insured; XLCA)  5.25  12/15/32  3,000,000    2,591,520 
Michigan Strategic Fund,           
   SWDR (Genesee Power           
   Station Project)  7.50  1/1/21  12,400,000    9,930,044 

12

Long-Term Municipal  Coupon  Maturity  Principal   
 Investments (continued)  Rate (%)  Date  Amount ($)  Value ($) 
Michigan (continued)         
Royal Oak Hospital Finance         
   Authority, HR (William Beaumont         
   Hospital Obligated Group)  8.25  9/1/39  5,500,000  5,887,530 
Minnesota—6.4%         
Dakota County Community         
   Development Agency, SFMR         
   (Mortgage-Backed Securities         
   Program) (Collateralized:         
   FHLMC, FNMA and GNMA)  5.15  12/1/38  2,356,378  2,340,355 
Dakota County Community         
   Development Agency, SFMR         
   (Mortgage-Backed Securities         
   Program) (Collateralized:         
   FHLMC, FNMA and GNMA)  5.30  12/1/39  2,606,494  2,461,338 
Duluth Economic Development         
   Authority, Health Care         
   Facilities Revenue (Saint         
   Luke’s Hospital)  7.25  6/15/32  5,000,000  4,026,550 
Minneapolis,         
   Health Care System Revenue         
   (Fairview Health Services)         
   (Insured; Assured Guaranty)  6.50  11/15/38  5,000,000  5,338,500 
North Oaks,         
   Senior Housing Revenue         
   (Presbyterian Homes of North         
   Oaks, Inc. Project)  6.25  10/1/47  5,265,000  3,844,766 
Saint Paul Housing and         
   Redevelopment Authority,         
   Hospital Facility Revenue         
   (HealthEast Project)  6.00  11/15/30  5,500,000  4,056,855 
Saint Paul Housing and         
   Redevelopment Authority,         
   Hospital Facility Revenue         
   (HealthEast Project)  6.00  11/15/35  2,000,000  1,400,840 
Winona,         
   Health Care Facilities Revenue         
   (Winona Health Obligated Group)  6.00  7/1/26  5,000,000  4,570,700 
Mississippi—4.4%         
Clairborne County, PCR (System         
   Energy Resources, Inc. Project)  6.20  2/1/26  4,545,000  3,701,403 

The Fund 13

STATEMENT OF INVESTMENTS (Unaudited) (continued)

Long-Term Municipal  Coupon  Maturity  Principal     
 Investments (continued)  Rate (%)  Date  Amount ($)    Value ($) 
Mississippi (continued)           
Mississippi Business Finance           
   Corporation, PCR (System           
   Energy Resources, Inc. Project)  5.88  4/1/22  14,310,000    12,205,142 
Warren County,           
   Gulf Opportunity Zone           
   Revenue (International Paper           
   Company Projects)  6.50  9/1/32  5,000,000    3,652,950 
Missouri—3.3%           
Missouri Development Finance           
   Board, Infrastructure           
   Facilities Revenue (Branson           
   Landing Project)  5.38  12/1/27  2,000,000    1,632,640 
Missouri Development Finance           
   Board, Infrastructure           
   Facilities Revenue (Branson           
   Landing Project)  5.50  12/1/32  4,500,000    3,591,135 
Missouri Development Finance           
   Board, Infrastructure Facilities           
   Revenue (Independence,           
   Crackerneck Creek Project)  5.00  3/1/28  2,000,000    1,789,040 
Missouri Health and Educational           
   Facilities Authority, Health           
   Facilities Revenue (Saint           
   Anthony’s Medical Center)  6.25  12/1/10  6,750,000  a  7,409,813 
Montana—.3%           
Montana Board of Housing,           
   SFMR  6.45  6/1/29  1,200,000    1,221,228 
Nevada—2.8%           
Washoe County,           
   GO Convention Center Revenue           
   (Reno-Sparks Convention and           
   Visitors Authority) (Insured; FSA)  6.40  1/1/10  12,000,000  a  12,528,720 
New Hampshire—3.0%           
New Hampshire Business Finance           
   Authority, PCR (Public Service           
   Company of New Hampshire)           
   (Insured; AMBAC)  6.00  5/1/21  7,000,000    6,524,000 
New Hampshire Health and           
   Educational Facilities Authority,           
   Revenue (Exeter Project)  6.00  10/1/24  1,000,000    961,510 

14

Long-Term Municipal  Coupon  Maturity  Principal   
 Investments (continued)  Rate (%)  Date  Amount ($)  Value ($) 
New Hampshire (continued)         
New Hampshire Health and         
   Educational Facilities Authority,         
   Revenue (Exeter Project)  5.75  10/1/31  1,000,000  904,880 
New Hampshire Industrial         
   Development Authority, PCR         
   (Connecticut Light and Power         
   Company Project)  5.90  11/1/16  5,000,000  4,832,400 
New Jersey—3.6%         
New Jersey Economic Development         
   Authority, Cigarette Tax Revenue  5.75  6/15/34  5,500,000  4,017,970 
New Jersey Higher Education         
   Student Assistance Authority,         
   Student Loan Revenue (Insured;         
   Assured Guaranty)  6.13  6/1/30  5,000,000  4,955,600 
Tobacco Settlement Financing         
   Corporation of New Jersey,         
   Tobacco Settlement         
   Asset-Backed Bonds  7.00  6/1/13  5,640,000 a  6,830,209 
New Mexico—1.1%         
Farmington,         
   PCR (Tucson Electric Power         
   Company San Juan Project)  6.95  10/1/20  3,000,000  2,973,150 
New Mexico Mortgage Finance         
   Authority, Single Family         
   Mortgage Program Revenue         
   (Collateralized: FHLMC, FNMA         
   and GNMA)  7.00  9/1/31  915,000  925,019 
New Mexico Mortgage Finance         
   Authority, Single Family         
   Mortgage Program Revenue         
   (Collateralized: FHLMC, FNMA         
   and GNMA)  6.15  7/1/35  1,130,000  1,146,419 
New York—4.7%         
New York City Industrial Development         
   Agency, Liberty Revenue (7 World         
   Trade Center Project)  6.25  3/1/15  3,275,000  2,748,249 
New York City Industrial         
   Development Agency, PILOT         
   Revenue (Yankee Stadium Project)         
   (Insured; Assured Guaranty)  7.00  3/1/49  5,000,000  5,569,150 

The Fund 15

STATEMENT OF INVESTMENTS (Unaudited) (continued)

Long-Term Municipal  Coupon  Maturity  Principal     
 Investments (continued)  Rate (%)  Date  Amount ($)    Value ($) 
New York (continued)           
New York City Industrial           
   Development Agency, Special           
   Facility Revenue (American           
   Airlines, Inc. John F. Kennedy           
   International Airport Project)  8.00  8/1/28  2,800,000    1,993,432 
Tobacco Settlement Financing           
   Corporation of New York,           
   Asset-Backed Revenue Bonds           
   (State Contingency Contract           
   Secured) (Insured; AMBAC)  5.25  6/1/21  5,000,000    5,010,200 
Triborough Bridge and Tunnel           
   Authority, Revenue  5.25  11/15/30  5,220,000    5,236,652 
North Carolina—.8%           
North Carolina Housing           
   Finance Agency, Home           
   Ownership Revenue  5.88  7/1/31  3,415,000    3,415,273 
North Dakota—.1%           
North Dakota Housing Finance           
   Agency, Home Mortgage Revenue           
   (Housing Finance Program)  6.15  7/1/31  405,000    414,882 
Ohio—4.8%           
Buckeye Tobacco Settlement           
   Financing Authority, Tobacco           
   Settlement Asset-Backed Bonds  5.88  6/1/30  3,000,000    1,827,810 
Buckeye Tobacco Settlement           
   Financing Authority, Tobacco           
   Settlement Asset-Backed Bonds  6.50  6/1/47  16,900,000    9,951,734 
Canal Winchester Local School           
   District, School Facilities           
   Construction and Improvement           
   and Advance Refunding           
   Bonds (GO—Unlimited Tax)           
   (Insured; MBIA, Inc.)  0.00  12/1/29  3,955,000  b  1,160,911 
Canal Winchester Local School           
   District, School Facilities           
   Construction and Improvement           
   and Advance Refunding           
   Bonds (GO—Unlimited Tax)           
   (Insured; MBIA, Inc.)  0.00  12/1/31  3,955,000  b  1,011,491 
Ohio,           
   SWDR (USG Corporation Project)  5.60  8/1/32  5,555,000    2,436,923 

16

Long-Term Municipal  Coupon  Maturity  Principal     
 Investments (continued)  Rate (%)  Date  Amount ($)    Value ($) 
Ohio (continued)           
Port of Greater Cincinnati           
   Development Authority, Tax           
   Increment Development Revenue           
   (Fairfax Village Red Bank           
   Infrastructure Project)  5.63  2/1/36  3,000,000    1,953,870 
Toledo Lucas County Port           
   Authority, Airport Revenue           
   (Baxter Global Project)  6.25  11/1/13  3,300,000    2,975,181 
Oklahoma—3.2%           
Oklahoma Housing Finance Agency,           
   SFMR (Homeownership           
   Loan Program)  7.55  9/1/28  855,000    866,089 
Oklahoma Housing Finance Agency,           
   SFMR (Homeownership Loan           
   Program) (Collateralized: FNMA           
   and GNMA)  7.55  9/1/27  555,000    568,065 
Oklahoma Industries Authority,           
   Health System Revenue           
   (Obligated Group)           
   (Insured; MBIA, Inc.)  5.75  8/15/09  5,160,000  a  5,314,181 
Oklahoma Industries Authority,           
   Health System Revenue           
   (Obligated Group)           
   (Insured; MBIA, Inc.)  5.75  8/15/09  7,070,000  a  7,281,252 
Pennsylvania—1.2%           
Pennsylvania Economic Development           
   Financing Authority, SWDR (USG           
   Corporation Project)  6.00  6/1/31  8,060,000    3,587,587 
Philadelphia Authority for           
   Industrial Development, Revenue           
   (Please Touch Museum Project)  5.25  9/1/31  2,500,000    1,832,700 
Rhode Island—1.2%           
Rhode Island Health and Educational           
   Building Corporation, Hospital           
   Financing Revenue (Lifespan           
   Obligated Group Issue)           
   (Insured; Assured Guaranty)  7.00  5/15/39  5,000,000    5,283,050 
South Carolina—2.3%           
South Carolina Public Service           
   Authority, Revenue Obligations  5.50  1/1/38  10,000,000    10,311,200 

The Fund 17

STATEMENT OF INVESTMENTS (Unaudited) (continued)

Long-Term Municipal  Coupon  Maturity  Principal     
 Investments (continued)  Rate (%)  Date  Amount ($)    Value ($) 
Tennessee—6.8%           
Johnson City Health and           
   Educational Facilities Board,           
   Hospital First Mortgage           
   Revenue (Mountain States           
   Health Alliance)  7.50  7/1/12  5,000,000  a  5,716,200 
Johnson City Health and           
   Educational Facilities Board,           
   Hospital First Mortgage           
   Revenue (Mountain States           
   Health Alliance)  7.50  7/1/12  3,000,000  a  3,429,720 
Knox County Health, Educational           
   and Housing Facility Board,           
   Revenue (University Health           
   System, Inc.)  5.25  4/1/36  8,910,000    6,706,022 
Memphis Center City Revenue           
   Finance Corporation, Sports Facility           
   Revenue (Memphis Redbirds           
   Baseball Foundation Project)  6.50  9/1/28  10,000,000  e  6,723,100 
Metropolitan Government of           
   Nashville and Davidson County           
   Health and Educational           
   Facilities Board, Revenue (The           
   Vanderbilt University)  5.50  10/1/34  7,000,000  c  7,248,500 
Texas—20.5%           
Austin Convention Enterprises Inc.,           
   Convention Center Hotel           
   First Tier Revenue  6.70  1/1/11  4,000,000  a  4,393,360 
Austin Convention Enterprises, Inc.,           
   Convention Center Hotel           
   Second Tier Revenue  5.75  1/1/34  3,000,000    1,813,830 
Brazos River Authority,           
   PCR (TXU Electric           
   Company Project)  8.25  5/1/33  7,000,000    3,792,740 
Cities of Dallas and Fort Worth,           
   Dallas/Fort Worth International           
   Airport, Facility Improvement           
   Corporation Revenue           
   (American Airlines, Inc.)  6.38  5/1/35  10,630,000    3,885,371 
Cities of Dallas and Fort Worth,           
   Dallas/Fort Worth           
   International Airport, Joint           
   Revenue (Insured; MBIA, Inc.)  6.25  11/1/28  3,000,000    3,003,450 

18

Long-Term Municipal  Coupon  Maturity  Principal     
 Investments (continued)  Rate (%)  Date  Amount ($)    Value ($) 
Texas (continued)           
Dallas Area Rapid Transit,           
   Senior Lien Sales Tax Revenue  5.25  12/1/48  10,000,000    9,987,600 
Gulf Coast Industrial Development           
   Authority, Environmental           
   Facilities Revenue (Microgy           
   Holdings Project)  7.00  12/1/36  6,000,000    3,317,400 
Harris County Health Facilities           
   Development Corporation, HR           
   (Memorial Hermann           
   Healthcare System)  6.38  6/1/11  8,500,000  a  9,527,480 
Harris County Health Facilities           
   Development Corporation, HR           
   (Memorial Hermann           
   Healthcare System)  7.25  12/1/35  2,000,000    2,092,280 
Houston,           
   Airport System Special           
   Facilities Revenue (Continental           
   Airlines, Inc. Terminal E Project)  6.75  7/1/29  5,125,000    3,141,625 
Houston,           
   Airport System Special           
   Facilities Revenue (Continental           
   Airlines, Inc. Terminal E Project)  7.00  7/1/29  3,800,000    2,401,904 
Houston,           
   Combined Utility System           
   First Lien Revenue (Insured;           
   Assured Guaranty)  6.00  11/15/36  5,000,000  c  5,203,550 
North Texas Tollway Authority,           
   First Tier System Revenue           
   (Insured; Assured Guaranty)  5.75  1/1/40  10,300,000    10,490,241 
North Texas Tollway Authority,           
   Second Tier System Revenue  5.75  1/1/38  5,500,000    4,868,490 
Sabine River Authority,           
   PCR (TXU Electric           
   Company Project)  6.45  6/1/21  11,300,000    5,626,609 
Sam Rayburn Municipal Power           
   Agency, Power Supply           
   System Revenue  5.75  10/1/21  6,000,000    5,336,100 
Texas Department of Housing and           
   Community Affairs, Home Mortgage           
   Revenue (Collateralized:           
   FHLMC, FNMA and GNMA)  12.38  7/2/24  800,000  f  848,176 

The Fund 19

STATEMENT OF INVESTMENTS (Unaudited) (continued)

Long-Term Municipal  Coupon  Maturity  Principal     
 Investments (continued)  Rate (%)  Date  Amount ($)    Value ($) 
Texas (continued)           
Texas Turnpike Authority,           
   Central Texas Turnpike System           
   Revenue (Insured; AMBAC)  5.75  8/15/38  7,100,000    6,651,706 
Tyler Health Facilities           
   Development Corporation, HR,           
   Refunding and Improvement           
   Bonds (East Texas Medical           
   Center Regional Healthcare           
   System Project)  5.25  11/1/32  5,500,000    3,731,255 
Vermont—.2%           
Vermont Housing Finance Agency,           
   SFHR (Insured; FSA)  6.40  11/1/30  680,000    692,492 
Virginia—2.6%           
Greater Richmond Convention Center           
   Authority, Hotel Tax Revenue           
   (Convention Center           
   Expansion Project)  6.25  6/15/10  10,500,000  a  11,302,515 
Pittsylvania County Industrial           
   Development Authority, Exempt           
   Facility Revenue (Multitrade of           
   Pittsylvania County, L.P. Project)  7.65  1/1/10  200,000    206,880 
Washington—5.3%           
Seattle,           
   Water System Revenue           
   (Insured; FGIC)  6.00  7/1/09  10,000,000  a  10,240,500 
Washington Health Care Facilities           
   Authority, Mortgage Revenue           
   (Highline Medical Center)           
   (Collateralized; FHA)  6.25  8/1/36  6,000,000    6,137,640 
Washington Higher Education           
   Facilities Authority, Revenue           
   (Seattle University Project)           
   (Insured; AMBAC)  5.25  11/1/37  4,210,000    4,100,414 
Washington Housing Finance           
   Commission, Revenue           
   (Single-Family Program)           
   (Collateralized: FHLMC, FNMA           
   and GNMA)  5.15  6/1/37  3,000,000    2,821,680 

20

Long-Term Municipal  Coupon  Maturity  Principal   
 Investments (continued)  Rate (%)  Date  Amount ($)  Value ($) 
West Virginia—1.4%         
The County Commission of Pleasants         
   County, PCR (Allegheny Energy         
   Supply Company, LLC Pleasants         
   Station Project)  5.25  10/15/37  5,000,000  3,741,500 
West Virginia Water Development         
   Authority, Water Development         
   Revenue (Insured; AMBAC)  6.38  7/1/39  2,250,000  2,227,388 
Wisconsin—9.5%         
Badger Tobacco Asset Securitization         
   Corporation, Tobacco Settlement         
   Asset-Backed Bonds  6.13  6/1/27  10,810,000  11,692,745 
Badger Tobacco Asset Securitization         
   Corporation, Tobacco Settlement         
   Asset-Backed Bonds  7.00  6/1/28  22,995,000  26,204,642 
Madison,         
   IDR (Madison Gas and Electric         
   Company Projects)  5.88  10/1/34  2,390,000  2,260,486 
Wisconsin Health and Educational         
   Facilities Authority, Revenue         
   (Aurora Health Care, Inc.)  6.40  4/15/33  2,000,000  1,730,800 
Wyoming—1.8%         
Sweetwater County,         
   SWDR (FMC Corporation Project)  5.60  12/1/35  4,500,000  3,318,075 
Wyoming Municipal Power Agency,         
   Power Supply System Revenue  5.50  1/1/33  2,360,000  2,255,924 
Wyoming Municipal Power Agency,         
   Power Supply System Revenue  5.38  1/1/42  2,750,000  2,524,775 
U.S. Related—1.7%         
Guam Housing Corporation,         
   SFMR (Guaranteed         
   Mortgage-Backed Securities         
   Program) (Collateralized; FHLMC)  5.75  9/1/31  965,000  955,350 
Puerto Rico Highways and         
   Transportation Authority,         
   Transportation Revenue  6.00  7/1/10   6,000,000 a  6,407,040 
Total Long-Term Municipal Investments       
   (cost $782,665,594)        713,153,969 

The Fund 21

STATEMENT OF INVESTMENTS (Unaudited) (continued)

Short-Term Municipal  Coupon  Maturity  Principal     
 Investments—4.8%  Rate (%)  Date  Amount ($)    Value ($) 
California—.2%           
Irvine Reassessment District,           
   Limited Obligation           
   Improvement Bonds           
   (Insured; FSA and           
   Liquidity Facility;           
   Dexia Credit Locale)  1.00  4/1/09  1,000,000  g  1,000,000 
Western Riverside County           
   Regional Wastewater           
   Authority, Revenue           
   (Western Riverside County           
   Regional Wastewater           
   Treatment System)           
   (LOC; Dexia Credit Locale)  1.10  4/1/09  100,000  g  100,000 
New York—2.2%           
Monroe County,           
   GO Notes, RAN  6.50  4/15/09  8,000,000    8,008,160 
New York City Housing           
   Development Corporation,           
   MFHR (Liquidity Facility;           
   Dexia Credit Locale)  0.50  4/1/09  1,500,000  g  1,500,000 
Ohio—.5%           
Cuyahoga County,           
   HR (W.O. Walker Center, Inc.           
   Project) (Insured; AMBAC and           
   Liquidity Facility; Key Bank)  9.00  4/7/09  2,300,000  g  2,300,000 

22

Short-Term Municipal  Coupon  Maturity  Principal   
 Investments (continued)  Rate (%)  Date  Amount ($)  Value ($) 
Vermont—1.9%         
Vermont Housing Finance Agency,         
   SFHR (Insured; FSA and Liquidity         
   Facility; DEPFA Bank PLC)  8.00  4/7/09  8,450,000 g  8,450,000 
Total Short-Term         
   Municipal Investments         
   (cost $21,350,000)        21,358,160 
 
Total Investments (cost $804,015,594)      166.6%  734,512,129 
Liabilities, Less Cash and Receivables      (2.0%)  (8,669,961) 
Preferred Stock, at redemption value           (64.6%)  (285,000,000) 
Net Assets Applicable to Common Shareholders    100.0%  440,842,168 

a These securities are prerefunded; the date shown represents the prerefunded date. Bonds which are prerefunded are 
   collateralized by U.S. Government securities which are held in escrow and are used to pay principal and interest on 
   the municipal issue and to retire the bonds in full at the earliest refunding date. 
b Security issued with a zero coupon. Income is recognized through the accretion of discount. 
c Purchased on a delayed delivery basis. 
d Security exempt from registration under Rule 144A of the Securities Act of 1933.This security may be resold in 
   transactions exempt from registration, normally to qualified institutional buyers.At March 31, 2009, this security 
   amounted to $2,232,990 or .5% of net assets applicable to Common Shareholders. 
e Non-income producing—security in default. 
f Inverse floater security—the interest rate is subject to change periodically. 
g Variable rate demand note—rate shown is the interest rate in effect at March 31, 2009. Maturity date represents the 
   next demand date, or the ultimate maturity date if earlier. 

The Fund 23

STATEMENT OF INVESTMENTS (Unaudited) (continued)     
 
 
 
 
Summary of Abbreviations     
 
ABAG  Association of Bay Area Governments  ACA  American Capital Access 
AGC  ACE Guaranty Corporation  AGIC  Asset Guaranty Insurance Company 
AMBAC  American Municipal Bond     
       Assurance Corporation  ARRN  Adjustable Rate Receipt Notes 
BAN  Bond Anticipation Notes  BIGI  Bond Investors Guaranty Insurance 
BPA  Bond Purchase Agreement  CGIC  Capital Guaranty Insurance Company 
CIC  Continental Insurance Company  CIFG  CDC Ixis Financial Guaranty 
CMAC  Capital Markets Assurance Corporation  COP  Certificate of Participation 
CP  Commercial Paper  EDR  Economic Development Revenue 
EIR  Environmental Improvement Revenue  FGIC  Financial Guaranty Insurance 
             Company 
FHA  Federal Housing Administration  FHLB  Federal Home Loan Bank 
FHLMC  Federal Home Loan Mortgage  FNMA  Federal National 
        Corporation          Mortgage Association 
FSA  Financial Security Assurance  GAN  Grant Anticipation Notes 
GIC  Guaranteed Investment Contract  GNMA  Government National 
           Mortgage Association 
GO  General Obligation  HR  Hospital Revenue 
IDB  Industrial Development Board  IDC  Industrial Development Corporation 
IDR  Industrial Development Revenue  LOC  Letter of Credit 
LOR  Limited Obligation Revenue  LR  Lease Revenue 
MFHR  Multi-Family Housing Revenue  MFMR  Multi-Family Mortgage Revenue 
PCR  Pollution Control Revenue  PILOT  Payment in Lieu of Taxes 
RAC  Revenue Anticipation Certificates  RAN  Revenue Anticipation Notes 
RAW  Revenue Anticipation Warrants  RRR  Resources Recovery Revenue 
SAAN  State Aid Anticipation Notes  SBPA  Standby Bond Purchase Agreement 
SFHR  Single Family Housing Revenue  SFMR  Single Family Mortgage Revenue 
SONYMA  State of New York Mortgage Agency  SWDR  Solid Waste Disposal Revenue 
TAN  Tax Anticipation Notes  TAW  Tax Anticipation Warrants 
TRAN  Tax and Revenue Anticipation Notes  XLCA  XL Capital Assurance 

24

Summary of Combined Ratings (Unaudited)   
 
Fitch  or  Moody’s  or  Standard & Poor’s  Value (%)† 
AAA    Aaa    AAA  36.3 
AA    Aa    AA  8.6 
A    A    A  17.0 
BBB    Baa    BBB  21.6 
BB    Ba    BB  2.5 
B    B    B  4.7 
CCC    Caa    CCC  .8 
F1    MIG1/P1    SP1/A1  1.7 
Not Ratedh    Not Ratedh    Not Ratedh  6.8 
          100.0 

† Based on total investments. 
h Securities which, while not rated by Fitch, Moody’s and Standard & Poor’s, have been determined by the Manager to be of comparable quality to those rated securities in which the fund may invest. 

See notes to financial statements.

The Fund

25

STATEMENT OF ASSETS AND LIABILITIES

March 31, 2009 (Unaudited)

  Cost  Value 
Assets ($):     
Investments in securities—See Statement of Investments  804,015,594  734,512,129 
Cash    205,787 
Interest receivable    14,443,252 
Receivable for investment securities sold    5,051,200 
Prepaid expenses    49,706 
    754,262,074 
Liabilities ($):     
Due to The Dreyfus Corporation and affiliates—Note 3(b)    472,626 
Payable for investment securities purchased    27,789,476 
Dividends payable to Preferred Shareholders    16,227 
Commissions payable    11,927 
Accrued expenses    129,650 
    28,419,906 
Auction Preferred Stock, Series M,T,W,Th and F,     
   par value $.001 per share (11,400 shares     
   issued and outstanding at $25,000 per share     
   liquidation preference)—Note 1    285,000,000 
Net Assets applicable to Common Shareholders ($)    440,842,168 
Composition of Net Assets ($):     
Common Stock, par value, $.001 per share     
   (60,766,921 shares issued and outstanding)    60,767 
Paid-in capital    572,970,948 
Accumulated undistributed investment income—net    3,776,136 
Accumulated net realized gain (loss) on investments    (66,462,218) 
Accumulated net unrealized appreciation     
   (depreciation) on investments    (69,503,465) 
Net Assets applicable to Common Shareholders ($)    440,842,168 
Shares Outstanding     
(500 million shares authorized)    60,766,921 
Net Asset Value, per share of Common Stock ($)    7.25 
 
See notes to financial statements.     

26

STATEMENT OF OPERATIONS

Six Months Ended March 31, 2009 (Unaudited)

Investment Income ($):   
Interest Income  23,604,195 
Expenses:   
Management fee—Note 3(a)  2,678,598 
Commission fees—Note 1  376,607 
Custodian fees—Note 3(b)  83,118 
Professional fees  54,624 
Shareholder servicing costs—Note 3(b)  54,064 
Directors’ fees and expenses—Note 3(c)  34,956 
Registration fees  31,520 
Shareholders’ reports  30,789 
Miscellaneous  39,136 
Total Expenses  3,383,412 
Less—reduction in management fee   
due to undertaking—Note 3(a)  (357,146) 
Net Expenses  3,026,266 
Investment Income—Net  20,577,929 
Realized and Unrealized Gain (Loss) on Investments—Note 4 ($):   
Net realized gain (loss) on investments  (10,545,884) 
Net unrealized appreciation (depreciation) on investments  (29,590,129) 
Net Realized and Unrealized Gain (Loss) on Investments  (40,136,013) 
Dividends on Preferred Stock  (2,872,959) 
Net (Decrease) in Net Assets Resulting from Operations  (22,431,043) 
 
See notes to financial statements.   

The Fund

27

STATEMENT OF CHANGES IN NET ASSETS

  Six Months Ended   
  March 31, 2009  Year Ended 
  (Unaudited)  September 30, 2008 
Operations ($):     
Investment income—net  20,577,929  41,314,010 
Net realized gain (loss) on investments  (10,545,884)  (8,527,185) 
Net unrealized appreciation     
   (depreciation) on investments  (29,590,129)  (67,515,841) 
Dividends on Preferred Stock  (2,872,959)  (10,069,467) 
Net Increase (Decrease) in Net Assets     
   Resulting from Operations  (22,431,043)  (44,798,483) 
Dividends to Common Shareholders from ($):     
Investment income—net  (15,313,261)  (30,611,039) 
Capital Stock Transactions ($):     
Dividends reinvested  —  397,727 
Total Increase (Decrease) in Net Assets  (37,744,304)  (75,011,795) 
Net Assets ($):     
Beginning of Period  478,586,472  553,598,267 
End of Period  440,842,168  478,586,472 
Undistributed investment income—net  3,776,136  1,384,427 
Capital Share Transactions (Shares):     
Increase in Shares Outstanding as a     
Result of Dividends Reinvested  —  46,087 
 
See notes to financial statements.     

28

FINANCIAL HIGHLIGHTS

The following table describes the performance for the fiscal periods indicated.Total return shows how much your investment in the fund would have increased (or decreased) during each period, assuming you had reinvested all dividends and distributions.These figures have been derived from the fund’s financial statements, and with respect to common stock, market price data for the fund’s common shares.

Six Months Ended           
March 31, 2009    Year Ended September 30,   
  (Unaudited)  2008  2007  2006  2005  2004 
Per Share Data ($):             
Net asset value,             
   beginning of period  7.88  9.12  9.46  9.38  9.18  9.14 
Investment Operations:             
Investment income—neta  .34  .68  .69  .66  .66  .63 
Net realized and unrealized             
   gain (loss) on investments  (.67)  (1.25)  (.36)  .09  .21  .12 
Dividends on Preferred Stock             
   from investment income—net  (.05)  (.17)  (.17)  (.15)  (.10)  (.06) 
Total from             
   Investment Operations  (.38)  (.74)  .16  .60  .77  .69 
Distributions to             
   Common Shareholders:             
Dividends from             
   investment income—net  (.25)  (.50)  (.50)  (.52)  (.57)  (.65) 
Net asset value, end of period  7.25  7.88  9.12  9.46  9.38  9.18 
Market value, end of period  6.64  6.75  8.74  9.18  8.87  8.86 
Total Return (%)b  2.32c  (18.00)  .46  9.74  6.87  1.55 

The Fund

29

FINANCIAL HIGHLIGHTS (continued)

Six Months Ended           
March 31, 2009    Year Ended September 30,   
  (Unaudited)  2008  2007  2006  2005  2004 
Ratios/Supplemental Data (%):             
Ratio of total expenses             
   to average net assets             
   applicable to Common Stockd  1.57e  1.58  1.63  1.55  1.47  1.43 
Ratio of net expenses             
   to average net assets             
   applicable to Common Stockd  1.41e  1.42  1.48  1.40  1.33  1.43 
Ratio of interest and expense             
   related to floating rate notes             
   issued to average net assets             
   applicable to Common Stockd  —  .17  .28  .18  .10  .05 
Ratio of net investment income             
   to average net assets             
   applicable to Common Stockd  9.57e  7.79  7.38  7.15  7.03  6.97 
Ratio of total expenses to             
   total average net assets  .95e  1.03  1.09  1.03  .98  .94 
Ratio of net expenses to             
   total average net assets  .85e  .92  .99  .93  .89  .94 
Ratio of interest and expense             
   related to floating rate notes             
   isssued to average net assets  —  .11  .19  .12  .07  .03 
Ratio of net investment income             
   to total average net assets  5.76e  5.07  4.92  4.75  4.67  4.59 
Portfolio Turnover Rate  16.13c  48.60  34.75  31.44  27.96  27.31 
Asset coverage of Preferred             
   Stock, end of period  255  268  294  301  299  295 
Net Assets, net of             
   Preferred Stock,             
   end of period ($ x 1,000)  440,842  478,586  553,598  573,391  568,264  556,235 
Preferred Stock outstanding,             
   end of period ($ x 1,000)  285,000  285,000  285,000  285,000  285,000  285,000 

a      Based on average shares outstanding at each month end.
b      Calculated based on market value.
c      Not annualized.
d      Does not reflect the effect of dividends to Preferred Stockholders.
e      Annualized.

See notes to financial statements.

30

NOTES TO FINANCIAL STATEMENTS (Unaudited)

NOTE 1—Significant Accounting Policies:

Dreyfus Strategic Municipals, Inc. (the “fund”) is registered under the Investment Company Act of 1940, as amended (the “Act”), as a diversified closed-end management investment company.The fund’s investment objective is to maximize current income exempt from federal income tax to the extent consistent with the preservation of capital. The Dreyfus Corporation (the “Manager” or “Dreyfus”), a wholly-owned subsidiary of The Bank of New York Mellon Corporation (“BNY Mellon”), serves as the fund’s investment advisor. The fund’s Common Stock trades on the New York Stock Exchange under the ticker symbol LEO.

The fund has outstanding 2,280 shares of Series M, Series T, Series W, SeriesTH and Series F for a total of 11,400 shares of Auction Preferred Stock (“APS”), with a liquidation preference of $25,000 per share (plus an amount equal to accumulated but unpaid dividends upon liquidation). APS dividend rates are determined pursuant to periodic auctions. Deutsche Bank Trust Company America, as Auction Agent, receives a fee from the fund for its services in connection with such auctions. The fund also compensates broker-dealers generally at an annual rate of .15%-.25% of the purchase price of the shares of APS.

The fund is subject to certain restrictions relating to the APS. Failure to comply with these restrictions could preclude the fund from declaring any distributions to common shareholders or repurchasing common shares and/or could trigger the mandatory redemption of APS at liquidation value.

The holders of the APS, voting as a separate class, have the right to elect at least two directors.The holders of the APS will vote as a separate class on certain other matters, as required by law. The fund has designated Robin A. Melvin and John E. Zuccotti as directors to be elected by the holders of APS.

The Fund

31

NOTES TO FINANCIAL STATEMENTS (Unaudited) (continued)

The fund’s financial statements are prepared in accordance with U.S. generally accepted accounting principles, which may require the use of management estimates and assumptions. Actual results could differ from those estimates.

The fund enters into contracts that contain a variety of indemnifications. The fund’s maximum exposure under these arrangements is unknown.The fund does not anticipate recognizing any loss related to these arrangements.

(a) Portfolio valuation: Investments in municipal debt securities are valued on the last business day of each week and month by an independent pricing service (the “Service”). Investments for which quoted bid prices are readily available and are representative of the bid side of the market in the judgment of the Service are valued at the mean between the quoted bid prices (as obtained by the Service from dealers in such securities) and asked prices (as calculated by the Service based upon its evaluation of the market for such securities). Other investments (which constitute a majority of the portfolio securities) are carried at fair value as determined by the Service, based on methods which include consideration of: yields or prices of municipal securities of comparable quality, coupon, maturity and type; indications as to values from dealers; and general market conditions. Options and financial futures on municipal and U.S.Treasury securities are valued at the last sales price on the securities exchange on which such securities are primarily traded or at the last sales price on the national securities market on the last business day of each week and month.

The fund adopted Statement of Financial Accounting Standards No. 157 “FairValue Measurements” (“FAS 157”). FAS 157 establishes an authoritative definition of fair value, sets out a framework for measuring fair value, and requires additional disclosures about fair value measurements.

32

Various inputs are used in determining the value of the fund’s investments relating to FAS 157.These inputs are summarized in the three broad levels listed below.

Level 1—quoted prices in active markets for identical investments. Level 2—other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.).

Level 3—significant unobservable inputs (including the fund’s own assumptions in determining the fair value of investments).

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used as of March 31, 2009 in valuing the fund’s investments:

    Level 2—Other  Level 3—   
  Level 1—  Significant  Significant   
  Quoted  Observable  Unobservable   
  Prices  Inputs  Inputs  Total 
Assets ($)         
Investments in         
Securities  —  734,512,129  —  734,512,129 
Other Financial         
   Instruments†  —  —  —  — 
Liabilities ($)         
Other Financial         
   Instruments†  —  —  —  — 

† Other financial instruments include derivative instruments, such as futures, forward currency exchange contracts, swap contracts and options contracts.Amounts shown represent unrealized appreciation (depreciation) at period end.

(b) Securities transactions and investment income: Securities transactions are recorded on a trade date basis. Realized gains and losses from securities transactions are recorded on the identified cost basis. Interest

The Fund 33

NOTES TO FINANCIAL STATEMENTS (Unaudited) (continued)

income, adjusted for accretion of discount and amortization of premium on investments, is earned from settlement date and recognized on the accrual basis. Securities purchased or sold on a when-issued or delayed delivery basis may be settled a month or more after the trade date.

The fund has an arrangement with the custodian bank whereby the fund receives earnings credits from the custodian when positive cash balances are maintained, which are used to offset custody fees. For financial reporting purposes, the fund includes net earnings credits, if any, as an expense offset in the Statement of Operations.

(c) Dividends to shareholders of Common Stock (“Common Shareholders(s)”): Dividends are recorded on the ex-dividend date. Dividends from investment income-net are declared and paid monthly. Dividends from net realized capital gains, if any, are normally declared and paid annually, but the fund may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code of 1986, as amended (the “Code”).To the extent that net realized capital gains can be offset by capital loss carryovers, it is the policy of the fund not to distribute such gains. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from U.S. generally accepted accounting principles.

For Common Shareholders who elect to receive their distributions in additional shares of the fund, in lieu of cash, such distributions will be reinvested at the lower of the market price or net asset value per share (but not less than 95% of the market price) based on the record date’s respective prices. If the net asset value per share on the record date is lower than the market price per share, shares will be issued by the fund at the record date’s net asset value on the payable date of the distribution. If the net asset value per share is less than 95% of the market value, shares will be issued by the fund at 95% of the market value. If the market price is lower than the net asset value per share on the record date, BNY Mellon Shareowner Services, a subsidiary of BNY Mellon and an affiliate of Dreyfus, will purchase fund shares in the open market

34

commencing on the payable date and reinvest those shares accordingly. As a result of purchasing fund shares in the open market, fund shares outstanding will not be affected by this form of reinvestment.

On March 30, 2009, the Board of Directors declared a cash dividend of $.042 per share from investment income-net, payable on April 30, 2009 to Common Shareholders of record as of the close of business on April 15, 2009.

(d) Dividends to shareholders of APS: Dividends, which are cumulative, are generally reset every 7 days for each Series of APS pursuant to a process specified in related fund charter documents. Dividends rates as of March 31, 2009 for each Series of APS were as follows: Series M-0.685%, Series T-0.685%, Series W-0.746%, Series TH-0.746% and Series F-0.746%.These rates reflect the “maximum rates” under the governing instruments as a result of “failed auctions” in which sufficient clearing bids are not received. The average dividend rates for the period ended March 31, 2009 for each Series of APS were as follows: Series M-2.03%, Series T-1.99%, Series W-1.98%, Series TH-2.02% and Series F-2.09%.

(e) Federal income taxes: It is the policy of the fund to continue to qualify as a regulated investment company, which can distribute tax exempt dividends, by complying with the applicable provisions of the Code and to make distributions of income and net realized capital gain sufficient to relieve it from substantially all federal income and excise taxes.

As of and during the period ended March 31, 2009, the fund did not have any liabilities for any uncertain tax positions.The fund recognizes interest and penalties, if any, related to uncertain tax positions as income tax expense in the Statement of Operations. During the period, the fund did not incur any interest or penalties.

Each of the tax years in the three-year period ended September 30, 2008 remains subject to examination by the Internal Revenue Service and state taxing authorities.

The Fund

35

NOTES TO FINANCIAL STATEMENTS (Unaudited) (continued)

The fund has an unused capital loss carryover of $47,105,572 available for federal income tax purposes to be applied against future net securities profits, if any, realized subsequent to September 30, 2008. If not applied, $19,582,677 of the carryover expires in fiscal 2011, $27,258,106 expires in fiscal 2012 and $264,789 expires in fiscal 2016.

The tax character of distributions paid to shareholders during the fiscal year ended September 30, 2008 were as follows: tax exempt income $40,680,506. The tax character of current year distributions will be determined at the end of the current fiscal year.

NOTE 2—Bank Line of Credit:

The fund participated with other Dreyfus managed funds in a $300 million unsecured line of credit provided by The Bank of New York Mellon (the “BNYM Facility”) primarily to be utilized for temporary or emergency purposes including the financing of redemptions. The terms of the BNYM Facility limits the amount of individual fund borrowings. Interest was charged to the fund based on prevailing market rates in effect at the time of borrowing. During the period ended October 1, 2008 through October 14, 2008, the fund did not borrow under the BNYM Facility. Effective October 15, 2008, the $300 million unsecured line of credit was terminated.

NOTE 3—Management Fee and Other Transactions With Affiliates:

(a) Pursuant to a management agreement (“Agreement”) with the Manager, the management fee is computed at the annual rate of .75% of the value of the fund’s average weekly net assets, inclusive of the outstanding auction preferred stock, and is payable monthly. The Agreement provides for an expense reimbursement from the Manager should the fund’s aggregate expenses, exclusive of taxes, interest on borrowings, brokerage and extraordinary expenses, in any full fiscal year exceed the lesser of (1) the expense limitation of any state having

36

jurisdiction over the fund or (2) 2% of the first $10 million, 1 1 / 2 % of the next $20 million and 1% of the excess over $30 million of the average value of the fund’s net assets. The fund has currently undertaken for the period from October 1, 2008 through October 31, 2009, to waive receipt of a portion of the fund’s management fee, in the amount of .10% of the value of the fund’s average weekly net assets (including net assets representing auction preferred stock outstanding). The reduction in management fee, pursuant to the undertaking, amounted to $357,146 during the period ended March 31, 2009.

(b) The fund compensates The Bank of New York Mellon under a custody agreement for providing custodial services to the fund. During the period ended March 31, 2009, the fund was charged $83,118 pursuant to the custody agreement.

The fund also compensates The Bank of New York Mellon under a transfer agency agreement for providing personnel and facilities to perform transfer agency services for the fund. During the period ended March 31, 2009, the fund was charged $54,064 pursuant to the transfer agency agreement.

During the period ended March 31, 2009, the fund was charged $2,394 for services performed by the Chief Compliance Officer.

The components of “Due to The Dreyfus Corporation and affiliates” in the Statement of Assets and Liabilities consist of: management fees $460,184, custodian fees $51,766, transfer agency per account fees $19,640 and chief compliance officer fees $2,394, which are offset against an expense reimbursement currently in effect in the amount of $61,358.

(c) Each Board member also serves as a Board member of other funds within the Dreyfus complex. Annual retainer fees and attendance fees are allocated to each fund based on net assets.

The Fund

37

NOTES TO FINANCIAL STATEMENTS (Unaudited) (continued)

NOTE 4—Securities Transactions:

The aggregate amount of purchases and sales of investment securities, excluding short-term securities, during the period ended March 31, 2009, amounted to $137,282,331 and $110,365,524, respectively.

At March 31, 2009, accumulated net unrealized depreciation on investments was $69,503,465, consisting of $27,448,001 gross unrealized appreciation and $96,951,466 gross unrealized depreciation.

At March 31, 2009, the cost of investments for federal income tax purposes was substantially the same as the cost for financial reporting purposes (see the Statement of Investments).

The Financial Accounting Standards Board released Statement of Financial Accounting Standards No. 161 “Disclosures about Derivative Instruments and Hedging Activities” (“FAS 161”). FAS 161 requires qualitative disclosures about objectives and strategies for using derivatives, quantitative disclosures about fair value amounts of gains and losses on derivative instruments and disclosures about credit-risk-related contingent features in derivative agreements.The application of FAS 161 is required for fiscal years and interim periods beginning after November 15, 2008.At this time, management is evaluating the implications of FAS 161 and its impact on the financial statements and the accompanying notes has not yet been determined.

38

INFORMATION ABOUT THE REVIEW AND APPROVAL OF THE FUND’S MANAGEMENT AGREEMENT (Unaudited)

At a Meeting of the fund’s Board of Directors held on November 10-11, 2008, the Board considered the re-approval for an annual period of the fund’s Management Agreement, pursuant to which the Manager provides the fund with investment advisory services, and the fund’s separate Administration Agreement, pursuant to which the Manager provides the fund with administrative services.The Board members, none of whom are “interested persons” (as defined in the Investment Company Act of 1940, as amended) of the fund, were assisted in their review by independent legal counsel and met with counsel in executive session separate from representatives of the Manager.

Analysis of Nature, Extent, and Quality of Services Provided to the Fund. The Board members considered information previously provided to them in a presentation from representatives of the Manager regarding services provided to the fund and other funds in the Dreyfus complex, and representatives of the Manager confirmed that there had been no material changes in the information. The Board also discussed the nature, extent, and quality of the services provided to the fund pursuant to the fund’s Management Agreement. The Manager’s representatives noted the fund’s closed-end structure, the relationships the Manager has with various intermediaries, the different needs of each intermediary, and the Manager’s corresponding need for broad, deep, and diverse resources to be able to provide ongoing shareholder services to fund shareholders. The Board noted the fund’s asset size and considered that a closed-end fund is not subject to the inflows and outflows of assets as an open-end fund would be that would increase or decrease its asset size.

The Board members also considered the Manager’s research and portfolio management capabilities and that the Manager also provides oversight of day-to-day fund operations, including fund accounting and administration and assistance in meeting legal and regulatory requirements.The Board members also considered the Manager’s extensive administrative, accounting, and compliance infrastructure.

The Fund

39

INFORMATION ABOUT THE REVIEW AND APPROVAL OF THE FUND’S MANAGEMENT AGREEMENT (Unaudited) (continued)

Comparative Analysis of the Fund’s Management Fee and Expense Ratio and Performance. The Board members reviewed reports prepared by Lipper, Inc., an independent provider of investment company data, which included information comparing the fund’s management fee and expense ratio with a group of comparable “leveraged” funds (the “Expense Group”) and with a broader group of funds (the “Expense Universe”) that were selected by Lipper. Included in the fund’s reports were comparisons of contractual and actual management fee rates and total operating expenses.

The Board members also reviewed the reports prepared by Lipper that presented the fund’s performance on an net asset value and market price basis, as well as comparisons of total return performance for various periods ended August 31, 2008 and yield performance for one-year periods ended August 31st for the fund to the same group of funds as the Expense Group (the “Performance Group”) and to a group of funds that was broader than the Expense Universe (the “Performance Universe”) that also were selected by Lipper. The Manager previously had furnished the Board with a description of the methodology Lipper used to select the fund’s Expense Group and Expense Universe, and Performance Group and Performance Universe. The Manager also provided a comparison of the fund’s total returns at net asset value to the fund’s Lipper category average returns for the past 10 calendar years.

The Board reviewed the results of the Expense Group and Expense Universe comparisons that were prepared based on financial statements currently available to Lipper as of August 31, 2008.The Board reviewed the range of management fees and expense ratios of the funds in the Expense Group and Expense Universe, and noted that the fund’s contractual management fee (based on net assets solely attributable to common stock) was higher than the Expense Group median and that the fund’s actual management fee was higher than the Expense Group and Expense Universe medians. The Board also

40

noted that the fund’s total expense ratio (based on net assets solely attributable to common stock after leverage) was higher than the Expense Group and Expense Universe medians.The Board noted the undertaking in effect by the Manager over the past year to waive receipt of .10% of the fund’s management fee and the Manager’s commitment to continue such waiver through October 31, 2009.

With respect to the fund’s performance on a net asset value basis, the Board noted that the fund’s total return performance was higher than the Performance Group median for three of the six reported time periods up to 10 years, and higher than Performance Universe median for four of the six reported time periods up to 10 years. The Board also received a presentation from the Manager which described the significant difference in municipal bond fund total return performance results for periods ended August 31, 2008 and September 30, 2008, and the Manager provided the Board with information indicating the fund’s improved total return ranking (at net asset value) for the 1-year period ended September 30, 2008.The Board further noted that the fund’s total return (at net asset value) was higher than the fund’s Lipper category average return for 6 of the past 10 calendar years (lower in 4 of the 10 years). On a yield performance basis, the Board noted that the fund’s 1-year yields for the past 10 annual periods were at or higher than the Performance Group median and variously at, higher, or lower thank the Performance Universe median for each of the annual periods.

With respect to the fund’s performance on a market price basis, the Board noted that the fund achieved a range total return results that were variously at, higher, or lower than the Performance Group and Performance Universe medians for each reported time period up to 10 years. On a yield performance basis, the Board noted that the fund’s 1-year yields for the past 10 annual periods were higher than the Performance Group and Performance Universe medians for 7 and 8 of the 10 reported annual periods, respectively.

The Fund

41

INFORMATION ABOUT THE REVIEW AND APPROVAL OF THE FUND’S MANAGEMENT AGREEMENT (Unaudited) (continued)

Representatives of the Manager reviewed with the Board members the fees paid to the Manager or its affiliates by investment companies managed by the Manager or its affiliates that were reported in the same Lipper category as the fund (the “Similar Funds”). It was noted that each Similar Fund also was a closed-end fund, for which similar services to be provided by the Manager are required.The Board members analyzed differences in fees paid to the Manager and discussed the relationship of the management fees in light of the services provided.The Board members considered the relevance of the fee information provided for the Similar Funds to evaluate the appropriateness and reasonableness of the fund’s management fee.The Manager’s representatives noted that there were no similarly managed institutional separate accounts or wrap fee accounts managed by the Manager or its affiliates with similar investment objectives, policies, and strategies as the fund.

Analysis of Profitability and Economies of Scale. The Manager’s representatives reviewed the dollar amount of expenses allocated and profit received by the Manager for the fund and the method used to determine such expenses and profit. The Board considered information, previously provided and discussed, prepared by an independent consulting firm regarding the Manager’s approach to allocating costs to, and determining the profitability of, individual funds and the entire Dreyfus mutual fund complex.The Board also had been informed that the methodology had also been reviewed by an independent registered public accounting firm which, like the consultant, found the methodology to be reasonable. The consulting firm also analyzed where any economies of scale might emerge in connection with the management of a fund. The Board members evaluated the profitability analysis in light of the relevant circumstances for the fund, including the extent to which economies of scale would be realized if the fund grows and whether fee levels reflect these economies of scale for the benefit of fund shareholders.The Board members also considered potential benefits to the Manager from acting as investment adviser to the fund and noted that there were no soft dollar arrangements in effect with respect to trading the fund’s portfolio.

42

It was noted that the Board members should consider the Manager’s profitability with respect to the fund as part of their evaluation of whether the fees under the Investment Advisory and Administration Agreements bear a reasonable relationship to the mix of services provided by the Manager, including the nature, extent, and quality of such services and that a discussion of economies of scale is predicated on increasing assets and that, if a fund’s assets had been decreasing, the possibility that the Manager may have realized any economies of scale would be less. It was noted that the profitability percentage for managing the fund was within the range determined by appropriate court cases to be reasonable given the services rendered and that the profitability percentage for managing the fund was reasonable given the generally superior service levels provided. The Board also noted the Manager’s waiver of receipt of a portion of the management fee over the past year and its effect on the profitability of the Manager.

At the conclusion of these discussions, the Board agreed that it had been furnished with sufficient information to make an informed business decision with respect to continuation of the fund’s Management Agreement. Based on the discussions and considerations as described above, the Board reached the following conclusions and determinations.

The Fund

43

INFORMATION ABOUT THE  REVIEW AND  APPROVAL  OF THE 
FUND’S MANAGEMENT  AGREEMENT  (Unaudited)  (continued) 

The Board members considered these conclusions and determinations, along with the information received on a routine and regular basis throughout the year, and, without any one factor being dispositive, the Board determined that re-approval of the fund’s Management Agreement was in the best interests of the fund and its shareholders.

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OFFICERS AND DIRECTORS Dreyfus Strategic Municipals, Inc.

200 Park Avenue New York, NY 10166

Directors

Joseph S. DiMartino David W. Burke William Hodding Carter, III Gordon J. Davis Joni Evans Ehud Houminer Richard C. Leone Hans C. Mautner

Robin A. Melvin* Burton N.Wallack John E. Zuccotti*

* Auction Preferred Stock Directors

Officers

President
J. David Officer

Executive Vice Presidents A. Paul Disdier Phillip N. Maisano Vice President and Secretary Michael A. Rosenberg

Vice President and Assistant Secretaries James Bitetto Joni Lacks Charatan Joseph M. Chioffi Janette E. Farragher John B. Hammalian Robert R. Mullery Jeff Prusnofsky

Treasurer
James Windels
Assistant Treasurers
Richard Cassaro
Gavin C. Reilly
Robert Robol
Robert Salviolo
Robert Svagna

Officers (continued)

Chief Compliance Officer Joseph W. Connolly

Portfolio Managers:

Joseph P. Darcy Douglas J. Gaylor James Welch

Investment Adviser

The Dreyfus Corporation

Custodian

The Bank of New York Mellon

Counsel

Stroock & Stroock & Lavan LLP

Transfer Agent,

Dividend Disbursing Agent and Registrar

BNY Mellon Shareowner Services (Common Stock) Deutsche Bank Trust Company America (Auction Preferred Stock)

Auction Agent

Deutsche Bank Trust Company America (Auction Preferred Stock)

Stock Exchange Listing

NYSE Symbol: LEO

Initial SEC Effective Date

9/23/87

The Net AssetValue appears in the following publications: Barron’s, Closed-End Bond Funds section under the heading “Municipal Bond Funds” every Monday;Wall Street Journal, Mutual Funds section under the heading “Closed-End Bond Funds” every Monday; NewYorkTimes, Business section under the heading “Closed-End Bond Funds—National Municipal Bond Funds” every Sunday.

Notice is hereby given in accordance with Section 23(c) of the Investment Company Act of 1940,as amended,that the fund may purchase shares of its common stock in the open market when it can do so at prices below the then current net asset value per share.

The Fund

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Item 2.  Code of Ethics. 
  Not applicable. 
Item 3.  Audit Committee Financial Expert. 
  Not applicable. 
Item 4.  Principal Accountant Fees and Services. 
  Not applicable. 
Item 5.  Audit Committee of Listed Registrants. 
  Not applicable. 
Item 6.  Investments. 
(a)  Not applicable. 
Item 7.  Disclosure of Proxy Voting Policies and Procedures for Closed-End Management 
  Investment Companies. 
  Not applicable. 
Item 8.  Portfolio Managers of Closed-End Management Investment Companies. 
  Not applicable. 
Item 9.  Purchases of Equity Securities by Closed-End Management Investment Companies and 
  Affiliated Purchasers. 
  None 
Item 10.  Submission of Matters to a Vote of Security Holders. 
  There have been no material changes to the procedures applicable to Item 10. 
Item 11.  Controls and Procedures. 

(a) The Registrant's principal executive and principal financial officers have concluded, based on their evaluation of the Registrant's disclosure controls and procedures as of a date within 90 days of the filing date of this report, that the Registrant's disclosure controls and procedures are reasonably designed to ensure that information required to be disclosed by the Registrant on Form N-CSR is recorded, processed, summarized and reported within the required time periods and that information required to be disclosed by the Registrant in the reports that it files or submits on Form N-CSR is accumulated and communicated to the Registrant's management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure.

(b) There were no changes to the Registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Registrant's internal control over financial reporting.

Item 12.  Exhibits. 

(a)(1) Not applicable.

(a)(2) Certifications of principal executive and principal financial officers as required by Rule 30a-2(a) under the Investment Company Act of 1940.

(a)(3) Not applicable.

(b) Certification of principal executive and principal financial officers as required by Rule 30a-2(b) under the Investment Company Act of 1940.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

Dreyfus Strategic Municipals, Inc.

By:  /s/ J. David Officer 
  J. David Officer 
President
 
Date:  May 28, 2009 

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

By:  /s/ J. David Officer 
  J. David Officer 
President
 
Date:  May 28, 2009 
 
By:  /s/ James Windels 
  James Windels 
Treasurer
 
Date:  May 28, 2009 

EXHIBIT INDEX

(a)(2) Certifications of principal executive and principal financial officers as required by Rule 30a-2(a) under the Investment Company Act of 1940. (EX-99.CERT)

(b) Certification of principal executive and principal financial officers as required by Rule 30a-2(b) under the Investment Company Act of 1940. (EX-99.906CERT)