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

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED
MANAGEMENT INVESTMENT COMPANY

Investment Company Act file number: 811-02319
______________________________________________

Fort Dearborn Income Securities, Inc.
______________________________________________________________________________
(Exact name of registrant as specified in charter)

51 West 52^nd Street, New York, New York 10019-6114
______________________________________________________________________________
(Address of principal executive offices) (Zip code)

Mark F. Kemper, Esq. UBS Global Asset Management (Americas) Inc. 51 West 52nd Street New York, NY 10019-6114

(Name and address of agent for service)

Copy to:

Bruce G. Leto, Esq. Stradley Ronon Stevens & Young LLP 2600 One Commerce Square Philadelphia, PA 19103

Registrant’s telephone number, including area code: 212-882 5000

Date of fiscal year end: September 30

Item 1. Schedule of Investments

Fort Dearborn Income Securities, Inc. – Portfolio of investments June 30, 2008 (unaudited)
		Face
		amount			Value
Bonds – 96.02%
US bonds – 88.73%
US corporate bonds – 51.91%
Abbott Laboratories,
6.150%, due 11/30/37		$	1,060,000		$	1,062,799
Allergan, Inc.,
5.750%, due 04/01/16			1,820,000			1,826,696
Allstate Corp.,
5.950%, due 04/01/36			550,000			484,964
Anheuser-Busch Cos., Inc.,
6.450%, due 09/01/37			400,000			382,294
Apache Corp.,
6.000%, due 01/15/37			575,000			564,208
Archer-Daniels-Midland Co.,
6.450%, due 01/15/38			350,000			350,905
AT&T, Inc.,
6.450%, due 06/15/34			995,000			960,632
6.500%, due 09/01/37			975,000			943,623
Bank of America Corp.,
5.420%, due 03/15/17			700,000			640,246
5.750%, due 12/01/17			615,000			577,556
Bear Stearns Cos., Inc.,
7.250%, due 02/01/18			1,310,000			1,367,070
BellSouth Corp.,
6.550%, due 06/15/34			1,015,000			980,265
Bristol-Myers Squibb Co.,
5.875%, due 11/15/36			850,000			792,922
Burlington Northern Santa Fe Corp.,
7.082%, due 05/13/29			840,000			863,258
Caterpillar Financial Services Corp.,
5.450%, due 04/15/18			340,000			337,065
Citigroup, Inc.,
6.125%, due 05/15/18			1,535,000			1,468,944
6.875%, due 03/05/38			1,465,000			1,413,718
Comcast Corp.,
6.950%, due 08/15/37			2,250,000			2,213,075
Consolidated Edison Co. of New York, Inc.,
Series 08-A, 5.850%, due 04/01/18			340,000			341,267
Series 08-B, 6.750%, due 04/01/38			340,000			351,858
CRH America, Inc.,
6.000%, due 09/30/16			310,000			287,498
CVS Caremark Corp.,
6.250%, due 06/01/27			1,050,000			1,028,289
Daimler Finance N.A. LLC,
8.500%, due 01/18/31			845,000			977,001
Dominion Resources, Inc.,
Series B, 5.950%, due 06/15/35			495,000			444,260
Dow Chemical Co.,
5.700%, due 05/15/18			155,000			150,102
DTE Energy Co.,
6.350%, due 06/01/16			705,000			705,470
Duke Energy Carolinas LLC,
6.050%, due 04/15/38			350,000			346,008
ERAC USA Finance Co.,
7.000%, due 10/15/37(1)			440,000			365,984
8.000%, due 01/15/11(1)			1,065,000			1,099,886
Exelon Generation Co. LLC,
5.350%, due 01/15/14			1,015,000			973,338
Florida Power & Light Co.,
5.650%, due 02/01/35			355,000			336,190
Florida Power Corp.,
6.350%, due 09/15/37			215,000			218,338
Fortune Brands, Inc.,
5.375%, due 01/15/16			1,090,000			1,020,759
General Electric Capital Corp.,
5.875%, due 01/14/38			1,820,000			1,649,408
GlaxoSmithKline Capital, Inc.,
6.375%, due 05/15/38			900,000			893,369
GMAC LLC,
6.875%, due 09/15/11			1,915,000			1,376,065
Goldman Sachs Group, Inc.,
6.150%, due 04/01/18			675,000			654,857
6.750%, due 10/01/37			1,135,000			1,038,237

		Face
		amount			Value
Bonds – (continued)
US bonds – (continued)
US corporate bonds – (continued)
Hartford Financial Services Group, Inc.,
6.300%, due 03/15/18		$	720,000		$	719,232
HSBC Bank USA N.A.,
5.625%, due 08/15/35			855,000			720,214
ICI Wilmington, Inc.,
5.625%, due 12/01/13			850,000			859,577
Johnson & Johnson,
5.850%, due 07/15/38			175,000			177,980
JP Morgan Chase Capital XXV,
Series Y, 6.800%, due 10/01/37			1,100,000			987,343
JPMorgan Chase & Co.,
6.400%, due 05/15/38			555,000			514,782
Kinder Morgan Energy Partners LP,
5.125%, due 11/15/14			580,000			545,596
5.800%, due 03/15/35			1,130,000			980,396
7.400%, due 03/15/31			265,000			272,344
Kroger Co.,
6.900%, due 04/15/38			650,000			667,397
Lehman Brothers Holdings, Inc.,
6.750%, due 12/28/17			725,000			681,083
6.875%, due 05/02/18			250,000			242,026
7.000%, due 09/27/27			680,000			628,732
McDonald’s Corp.,
6.300%, due 03/01/38			275,000			272,418
Merck & Co., Inc.,
6.400%, due 03/01/28			520,000			542,735
Merrill Lynch & Co., Inc.,
5.700%, due 05/02/17			400,000			352,175
6.875%, due 04/25/18			365,000			347,380
MidAmerican Energy Holdings Co.,
5.950%, due 05/15/37			900,000			844,326
Morgan Stanley,
6.625%, due 04/01/18			750,000			710,644
7.250%, due 04/01/32			355,000			342,504
New Cingular Wireless Services, Inc.,
8.750%, due 03/01/31			945,000			1,121,317
News America, Inc.,
6.200%, due 12/15/34			695,000			640,916
Norfolk Southern Corp.,
5.750%, due 04/01/18(1)			340,000			334,624
Northrop Grumman Systems Corp.,
7.125%, due 02/15/11			425,000			453,067
Nustar Logistics,
7.650%, due 04/15/18			575,000			581,571
Oracle Corp.,
6.500%, due 04/15/38			550,000			551,363
Pacific Gas & Electric Co.,
6.050%, due 03/01/34			540,000			520,686
Pemex Project Funding Master Trust,
5.750%, due 03/01/18(1)			685,000			676,437
Philip Morris International, Inc.,
6.375%, due 05/16/38			345,000			336,211
PPL Energy Supply LLC,
Series A, 6.000%, due 12/15/36			370,000			321,218
Progressive Corp.,
6.250%, due 12/01/32			275,000			265,833
Prologis,
5.625%, due 11/15/15			825,000			775,080
Prudential Financial, Inc.,
6.625%, due 12/01/37			425,000			401,180
PSEG Power LLC,
8.625%, due 04/15/31			695,000			837,708
Residential Capital LLC,
9.625%, due 05/15/15(1)			49,000			23,765
Safeway, Inc.,
7.250%, due 02/01/31			645,000			691,435
San Diego Gas & Electric Co.,
Series FFF, 6.125%, due 09/15/37			450,000			450,072
Schering-Plough Corp.,
6.550%, due 09/15/37			525,000			512,726
Simon Property Group LP,
5.375%, due 06/01/11			300,000			295,613
Southern California Edison Co.,
Series 06-E, 5.550%, due 01/15/37			375,000			350,475
Sprint Capital Corp.,
6.875%, due 11/15/28			1,280,000			1,065,600

		Face
		amount			Value
Bonds – (continued)
US bonds – (continued)
US corporate bonds – (concluded)
Target Corp.,
6.500%, due 10/15/37		$	290,000		$	278,973
7.000%, due 07/15/31			305,000			322,668
Teva Pharmaceutical Finance LLC,
5.550%, due 02/01/16			845,000			825,682
Time Warner Cable, Inc.,
7.300%, due 07/01/38			600,000			596,311
Time Warner, Inc.,
7.625%, due 04/15/31			1,030,000			1,045,703
Travelers Property Casualty Corp.,
6.375%, due 03/15/33			350,000			334,284
Union Electric Co.,
6.700%, due 02/01/19			340,000			344,393
UnitedHealth Group, Inc.,
6.875%, due 02/15/38			865,000			818,562
Valero Energy Corp.,
6.625%, due 06/15/37			360,000			330,065
7.500%, due 04/15/32			885,000			895,680
Verizon Communications, Inc.,
6.900%, due 04/15/38			520,000			513,901
Verizon New York, Inc.,
Series B, 7.375%, due 04/01/32			1,085,000			1,102,181
Wachovia Bank N.A.,
5.850%, due 02/01/37			1,175,000			935,319
Wal-Mart Stores, Inc.
6.500%, due 08/15/37			900,000			926,238
Washington Mutual Bank,
5.500%, due 01/15/13			1,000,000			800,000
6.750%, due 05/20/36			500,000			365,000
Washington Mutual Preferred Funding LLC,
9.750%, due 12/15/17(1),(2),(3)			1,300,000			1,023,750
Waste Management, Inc.,
6.100%, due 03/15/18			700,000			698,391
WellPoint, Inc.,
5.850%, due 01/15/36			705,000			605,816
Wells Fargo Bank N.A.,
5.950%, due 08/26/36			1,380,000			1,291,970
Weyerhaeuser Co.,
7.375%, due 03/15/32			665,000			659,594
Xerox Corp.,
6.350%, due 05/15/18			540,000			533,034
Total US corporate bonds
(cost $72,745,666)						69,351,720
Asset-backed securities – 2.94%
Citibank Credit Card Issuance Trust,
Series 07-A3, Class A3,
6.150%, due 06/15/39			390,000			365,586
CPL Transition Funding LLC,
Series 02-1, Class A5,
6.250%, due 01/15/17			3,000,000			3,131,376
Small Business Administration,
Series 04-P10B, Class 1,
4.754%, due 08/10/14			442,881			434,299
Total asset-backed securities
(cost $4,075,207)						3,931,261
Mortgage & agency debt securities – 8.10%
Federal Home Loan Mortgage Corp.,
3.500%, due 05/29/13			1,345,000			1,306,918
5.000%, due 01/30/14			30,000			31,002
Federal Home Loan Mortgage Corp. Gold Pool,
# E01127, 6.500%, due 02/01/17			133,758			139,304
Federal National Mortgage Association,
3.500%, due 04/28/11			190,000			189,471
3.875%, due 07/12/13			1,340,000			1,321,969
5.250%, due 08/01/12			450,000			455,411
5.625%, due 07/15/37			1,500,000			1,594,947
Federal National Mortgage Association Grantor Trust,
Series 02-T19, Class A1,
6.500%, due 07/25/42			312,501			327,089
Federal National Mortgage Association Pools,
# 688066, 5.500%, due 03/01/33			349,439			346,703
# 793666, 5.500%, due 09/01/34			1,736,750			1,718,805
# 802481, 5.500%, due 11/01/34			305,998			302,837
# 596124, 6.000%, due 11/01/28			215,521			219,557
# 253824, 7.000%, due 03/01/31			101,048			107,273

		Face
		amount			Value
Bonds – (continued)
US bonds – (concluded)
Mortgage & agency debt securities – (concluded)
Federal National Mortgage Association, REMIC,
Series 93-106, Class Z,
7.000%, due 06/25/13		$	44,098		$	45,964
Government National Mortgage Association Pool,
# 781029, 6.500%, due 05/15/29			69,006			71,693
GSR Mortgage Loan Trust,
Series 06-2F, Class 3A4,
6.000%, due 02/25/36			1,300,000			1,167,978
Residential Funding Mortgage Securitization I, Inc.,
Series 06-S6, Class M2,
6.000%, due 07/25/36			1,280,141			322,852
Wells Fargo Mortgage Backed Securities Trust,
Series 03-18, Class A2,
5.250%, due 12/25/33			1,233,212			1,154,670
Total mortgage & agency debt securities
(cost $11,919,409)						10,824,443
Municipal bonds – 3.88%
New Jersey Economic Development Authority Revenue Bonds,
Series B, 10.905%, due 02/15/18(4)			5,000,000			2,975,750
State of Illinois General Obligation Bonds,
5.100%, due 06/01/33			2,350,000			2,212,454
Total municipal bonds
(cost $4,620,634)						5,188,204
US government obligations – 21.90%
US Treasury Bonds,
4.750%, due 02/15/37			1,615,000			1,667,740
8.125%, due 08/15/19			165,000			220,378
US Treasury Inflation Indexed Notes (TIPS),
1.625%, due 01/15/18			7,976,212			8,102,706
US Treasury Notes,
1.750%, due 03/31/10			1,600,000			1,579,374
2.750%, due 02/28/13			7,330,000			7,155,913
4.500%, due 03/31/09			5,480,000			5,566,907
4.750%, due 08/15/17			4,690,000			4,968,469
Total US government obligations
(cost $29,301,439)						29,261,487
Total US bonds
(cost $122,662,355)						118,557,115
International bonds – 7.29%
International corporate bonds – 7.29%
Canada – 1.75%
Anadarko Finance Co.,
Series B, 7.500%, due 05/01/31			380,000			407,337
Canadian National Railway Co.,
6.375%, due 11/15/37			625,000			616,125
6.900%, due 07/15/28			285,000			298,216
Canadian National Resources, Ltd.,
6.750%, due 02/01/39			1,020,000			1,022,160
						2,343,838
Cayman Islands – 0.92%
Transocean, Inc.,
6.800%, due 03/15/38			535,000			547,162
7.500%, due 04/15/31			620,000			678,983
						1,226,145
Luxembourg – 0.71%
Telecom Italia Capital SA,
6.375%, due 11/15/33			1,060,000			943,685
Netherlands – 0.54%
E. ON International Finance BV,
6.650%, due 04/30/38(1)			725,000			721,834

		Face
		amount			Value
Bonds – (concluded)
International bonds – (concluded)
International corporate bonds – (concluded)
Switzerland – 1.25%
Credit Suisse,
6.000%, due 02/15/18		$	1,740,000		$	1,675,477
United Kingdom – 2.12%
Abbey National PLC,
7.950%, due 10/26/29			750,000			762,799
AstraZeneca PLC,
6.450%, due 09/15/37			745,000			758,445
Royal Bank of Scotland Group PLC,
7.640%, due 09/29/17(2),(3)			700,000			640,030
SABMiller PLC,
6.500%, due 07/01/16(1)			650,000			671,230
						2,832,504
Total international corporate bonds
(cost $10,090,077)						9,743,483
Total bonds
(cost $132,752,432)						128,300,598
		Shares
Short-term investment – 2.83%
Other – 2.83%
UBS Supplementary Trust – U.S. Cash Management Prime Fund, 2.706%(5),(6)
(cost $3,780,327)			3,780,327			3,780,327
Total investments(7) – 98.85%
(cost $136,532,759)						132,080,925
Cash and other assets, less liabilities – 1.15%						1,536,426
Net assets – 100.00%					$	133,617,351

Notes to portfolio of investments

Aggregate cost for federal income tax purposes, which was the same for book purposes, was $136,532,759; and net unrealized depreciation consisted of:

Gross unrealized appreciation		$	1,309,109
Gross unrealized depreciation			(5,760,943	)
Net unrealized depreciation		$	(4,451,834	)

(1)		Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities are considered liquid, unless otherwise noted, and may be resold in transactions exempt from registration, normally to qualified institutional buyers. At June 30, 2008, the value of these securities amounted to $4,917,510 or 3.68% of net assets.
(2)		Floating rate security – The interest rate shown is the current rate as of June 30, 2008.
(3)		Perpetual bond security. The maturity date reflects the next call date.
(4)		Zero coupon bond. The rate shown is the effective yield at June 30, 2008.
(5)		The rate shown reflects the yield at June 30, 2008.
(6)		The table below details the Fund’s investment in a security issued by a fund that is advised by the same advisor as the Fund. The advisor does not earn a management fee from UBS Supplementary Trust.

Income earned

Purchases

Sales

from affiliate

during the

during the

for the

nine months

nine months

nine months

Value

ended

ended

Value

ended

Security description

09/30/07

06/30/08

06/30/08

06/30/08

06/30/08

UBS Supplementary Trust – U.S. Cash Management Prime Fund

$

1,247,839

$

48,492,133

$

45,959,645

$

3,780,327

$

88,618

(7)

The Fund calculates its net asset value based on the current market value, where available, for its portfolio securities. The Fund normally obtains market values for its securities from independent pricing sources. Independent pricing sources may use reported last sale prices, current market quotations or valuations from computerized “matrix” systems that derive values based on comparable securities. A matrix system incorporates parameters such as security quality, maturity and coupon, and/or research and evaluations by its staff, including review of broker-dealer market price quotations, if available, in determining the valuation of portfolio securities. Securities traded in the over-the-counter (“OTC”) market and listed on The NASDAQ Stock Market, Inc. (“NASDAQ”) normally are valued at the NASDAQ Official Closing Price. Other OTC securities are valued at the last bid price available on the valuation date prior to valuation. Securities which are listed on US and foreign stock exchanges normally are valued at the last sale price on the day the securities are valued or, lacking any sales on such day, at the last available bid price. Securities listed on foreign stock exchanges may be fair valued based on significant events that have occurred subsequent to the close of the foreign markets. The Fund may use a systematic fair valuation model provided by an independent third party to value securities principally traded in foreign markets in order to adjust for possible stale pricing that may occur between the close of the foreign exchanges and the time for valuation. If a security is valued at a “fair value,” that value is likely to be different from the last quoted market price for the security. In cases where securities are traded on more than one exchange, the securities are valued on the exchange designated as the primary market by UBS Global Asset Management (Americas) Inc. (“UBS Global AM”), the investment manager of the Fund. UBS Global AM is an indirect wholly owned asset management subsidiary of UBS AG, an internationally diversified organization with headquarters in Zurich and Basel, Switzerland and operations in many areas of the financial services industry. If a market value is not readily available from an independent pricing source for a particular security, that security is valued at fair value as determined in good faith by or under the direction of the Fund’s Board of Directors (the “Board”). Various factors may be reviewed in order to make a good faith determination of a security’s fair value. These factors include, but are not limited to, fundamental analytical data relating to the investment; the nature and duration of restrictions on disposition of the securities; and the evaluation of forces which influence the market in which the securities are purchased and sold. Investments in open-end investment companies are valued at the daily closing net asset value of the respective investment company.

GMAC		General Motors Acceptance Corp.
GSR		Goldman Sachs Residential
REMIC		Real Estate Mortgage Investment Conduit
TIPS		Treasury inflation protected securities (“TIPS”) are debt securities issued by the US Treasury whose principal and/or interest payments are adjusted for inflation, unlike debt securities that make fixed principal and interest payments. The interest rate paid by the TIPS is fixed, while the principal value rises or falls based on changes in a published Consumer Price Index (“CPI”). Thus, if inflation occurs, the principal and interest payments on the TIPS are adjusted accordingly to protect investors from inflationary loss. During a deflationary period, the principal and interest payments decrease, although the TIPS principal amounts will not drop below their face amounts at maturity. In exchange for the inflation protection, the TIPS generally pay lower interest rates than typical US Treasury securities. Only if inflation occurs will TIPS offer a higher real yield than a conventional Treasury bond of the same maturity.
		For more information regarding the Fund’s other significant accounting policies, please refer to the Fund’s semi-annual report to shareholders dated March 31, 2008.

Industry diversification
As a percentage of net assets As of June 30, 2008 (unaudited)
Bonds
US bonds
US corporate bonds
Aerospace & defense			0.34	%
Automobiles			0.73
Beverages			0.29
Capital markets			5.50
Chemicals			0.76
Commercial banks			2.21
Commercial services & supplies			0.52
Construction materials			0.22
Consumer finance			1.03
Diversified financial services			4.96
Diversified telecommunication services			4.17
Electric utilities			2.68
Energy equipment & services			0.44
Food & staples retailing			2.48
Food products			0.26
Health care providers & services			1.07
Hotels, restaurants & leisure			0.20
Household durables			0.76
Insurance			1.65
Media			3.36
Multi-utilities			2.85
Multiline retail			0.45
Office electronics			0.40
Oil, gas & consumable fuels			3.19
Paper & forest products			0.49
Pharmaceuticals			4.97
Real estate investment trusts (REITs)			0.80
Road & rail			1.99
Software			0.41
Thrifts & mortgage finance			1.64
Tobacco			0.25
Wireless telecommunication services			0.84
Total US corporate bonds			51.91
Asset-backed securities			2.94
Mortgage & agency debt securities			8.10
Municipal bonds			3.88
US government obligations			21.90
Total US bonds			88.73
International bonds
International corporate bonds
Beverages			0.50
Commercial banks			1.73
Diversified telecommunication services			0.71
Electric utilities			0.54
Energy equipment & services			0.92
Oil, gas & consumable fuels			1.07
Pharmaceuticals			0.57
Road & rail			0.68
Thrifts & mortgage finance			0.57
Total international bonds			7.29
Total bonds			96.02
Short-term investment			2.83
Total investments			98.85
Cash and other assets, less liabilities			1.15
Net assets			100.00	%

Item 2. Controls and Procedures.

(a)		The registrant’s principal executive officer and principal financial officer have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (“Investment Company Act”)) are effective based on their evaluation of these controls and procedures as of a date within 90 days of the filing date of this document.
(b)		The registrant’s principal executive officer and principal financial officer are aware of no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act) that occurred during the registrant’s last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

Item 3. Exhibits.

(a)

Certifications of principal executive officer and principal financial officer of registrant pursuant to Rule 30a-2(a) under the Investment Company Act is attached hereto as Exhibit EX-99.CERT.

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.

Fort Dearborn Income Securities, Inc.

By:		/s/ Kai R. Sotorp
		Kai R. Sotorp
		President
Date:		August 29, 2008

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/ Kai R. Sotorp
		Kai R. Sotorp
		President
Date:		August 29, 2008
By:		/s/ Thomas Disbrow
		Thomas Disbrow
		Treasurer & Principal Accounting Officer
Date:		August 29, 2008