ds_ncsr1210.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANY

Investment Company Act file number 811-02679

DAVIS SERIES, INC.

(Exact name of registrant as specified in charter)

2949 East Elvira Road, Suite 101

Tucson, AZ 85756

(Address of principal executive offices)

Thomas D. Tays

Davis Selected Advisers, L.P.

2949 East Elvira Road, Suite 101

Tucson, AZ 85756

(Name and address of agent for service)

Registrant’s telephone number, including area code: 520-806-7600

Date of fiscal year end: December 31, 2010

Date of reporting period: December 31, 2010

____________________

ITEM 1. REPORT TO STOCKHOLDERS

DAVIS SERIES, INC.

Table of Contents

Shareholder Letter	2

Management's Discussion of Fund Performance:
Davis Opportunity Fund	3
Davis Government Bond Fund	5
Davis Financial Fund	7
Davis Appreciation & Income Fund	9
Davis Real Estate Fund	11

Fund Overview:
Davis Opportunity Fund	13
Davis Government Bond Fund	15
Davis Government Money Market Fund	16
Davis Financial Fund	17
Davis Appreciation & Income Fund	18
Davis Real Estate Fund	20

Expense Example	22

Schedule of Investments:
Davis Opportunity Fund	25
Davis Government Bond Fund	29
Davis Government Money Market Fund	32
Davis Financial Fund	35
Davis Appreciation & Income Fund	38
Davis Real Estate Fund	42

Statements of Assets and Liabilities	45

Statements of Operations	47

Statements of Changes in Net Assets	48

Notes to Financial Statements	50

Financial Highlights	65

Report of Independent Registered Public Accounting Firm	71

Fund Information	72

Matters Submitted to a Vote of Shareholders	73

Privacy Notice and Householding	74

Directors and Officers	75

This Annual Report is authorized for use by existing shareholders. Prospective shareholders must receive a current Davis Series, Inc. prospectus, which contains more information about investment strategies, risks, charges, and expenses. Please read the prospectus carefully before investing or sending money.

Shares of the Davis Funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including possible loss of the principal amount invested.

DAVIS SERIES, INC.

Shareholder Letter

Dear Fellow Shareholder,

As stewards of our customers’ savings, the management team and Directors of the Davis Funds recognize the importance of candid, thorough, and regular communication with our shareholders. In our Annual and Semi-Annual Reports we include all of the required quantitative information such as audited financial statements, detailed footnotes, performance reports, fund holdings, and performance attribution. Also included is a list of positions opened and closed.

In addition, we produce a Research Report for certain funds, which is published semi-annually. In this report, we give a more qualitative perspective on fund performance, discuss our thoughts on individual holdings, and share our investment outlook. You may obtain a copy of the current Research Report either on our website, www.davisfunds.com, or by calling 1-800-279-0279.

We thank you for your continued trust. We will do our best to earn it in the years ahead.

Sincerely,

Christopher C. Davis

President

February 1, 2011

DAVIS SERIES, INC.	Management’s Discussion of Fund Performance
DAVIS OPPORTUNITY FUND

Performance Overview

Davis Opportunity Fund’s Class A shares delivered a total return on net asset value of 13.92% for the year ended December 31, 2010. Over the same time period, the Russell 3000® Index (“Index”) returned 16.93%. All sectors1 within the Index registered increases over the year. Consumer discretionary, industrials, and materials were the sectors within the Index that increased the most. Health care and utilities were the sectors within the Index that increased the least.

Factors Impacting the Fund’s Performance

The Fund’s 2010 performance benefited from Youku.com2, an initial public offering (IPO) in the information technology sector. Davis Advisors purchases shares intending to benefit from long-term growth of the underlying company; the rapid appreciation of the IPO was an unusual occurrence. The Fund’s information technology sector benefited from the addition of Youku.com, and as such, information technology companies were the most important contributor3 to performance. Texas Instruments was also among the most important contributors to performance. Microsoft and Hewlett-Packard were among the most important detractors from performance.

Consumer discretionary companies were also an important contributor to the Fund’s performance. The Fund’s consumer discretionary companies out-performed the corresponding sector within the Index (up 37% versus up 30% for the Index) and had a lower relative average weighting (10% versus 11% for the Index). Yum! Brands and Hunter Douglas were among the most important contributors to performance. H&R Block and Lagardere were among the most important detractors from performance. The Fund no longer owns Lagardere.

Consumer staple companies were also important contributors to the Fund’s performance. The Fund’s consumer staple companies out-performed the corresponding sector within the Index (up 23% versus up 14% for the Index) and had approximately the same average weighting (both 10%). Coca-Cola was among the most important contributors to performance.

Although the Fund’s energy companies made positive contributions to performance, they were the most important reason that the Fund lagged the Index. The Fund’s energy companies under-performed the corresponding sector within the Index (up 4% versus up 22% for the Index) and had a lower relative average weighting (7% versus 10% for the Index) in this stronger performing sector. Transocean was among the most important detractors from performance.

The Fund’s material companies under-performed the corresponding sector within the Index (up 11% versus up 25% for the Index), but had a higher relative average weighting (9% versus 4% for the Index) in this stronger performing sector. Sino-Forest and Sigma-Aldrich were among the most important contributors to performance while Monsanto and Yingde Gases Group were among the most important detractors from performance.

The Fund had approximately 19% of its net assets invested in foreign companies at December 31, 2010. As a whole, those companies out-performed the domestic companies held by the Fund.

Davis Opportunity Fund’s investment objective is long-term growth of capital. There can be no assurance that the Fund will achieve its objective. Davis Opportunity Fund’s principal risks are: market risk, company risk, under $10 billion market capitalization risk, foreign country risk, fees and expenses risk, and headline risk. See the prospectus for a full description of each risk.

1 The companies included in the Russell 3000® Index are divided into ten sectors. One or more industry groups make up a sector.

2 This Management Discussion of Fund Performance discusses a number of individual companies. The information provided in this report does not provide information reasonably sufficient upon which to base an investment decision and should not be considered a recommendation to purchase or sell any particular security. The Schedule of Investments lists the Fund’s holdings of each company discussed.

3 A company’s or sector’s contribution to or detraction from the Fund’s performance is a product both of its appreciation or depreciation and its weighting within the Fund. For example, a 5% holding that rises 20% has twice as much impact as a 1% holding that rises 50%.

DAVIS SERIES, INC.	Management’s Discussion of Fund Performance
DAVIS OPPORTUNITY FUND - (CONTINUED)

Comparison of a $10,000 investment in Davis Opportunity Fund Class A versus the Russell 3000® Index over 10 years for an investment made on December 31, 2000

Average Annual Total Return for periods ended December 31, 2010

Fund & Benchmark Index	1-Year	5-Year	10-Year	Since Inception	Inception Date	Gross Expense Ratio	Net Expense Ratio
Class A - without sales charge	13.92%	1.12%	3.81%	10.12%	12/01/94	1.05%	1.05%
Class A - with sales charge	8.52%	0.14%	3.30%	9.78%	12/01/94	1.05%	1.05%
Class B†, **	8.91%	(0.11)%	3.23%	11.15%	05/01/84	1.99%	1.99%
Class C**	12.06%	0.35%	2.99%	4.71%	08/15/97	1.84%	1.84%
Class Y	14.31%	1.44%	4.15%	5.42%	09/18/97	0.75%	0.75%
Russell 3000® Index***	16.93%	2.74%	2.16%	8.79%

The Russell 3000® Index measures the performance of the 3,000 largest companies based on total market capitalization, which represents approximately 98% of the investable U.S. equity market. Investments cannot be made directly in the Index.

The performance data for Davis Opportunity Fund contained in this report represents past performance and assumes that all distributions were reinvested, and should not be considered as an indication of future performance from an investment in the Fund today. The investment return and principal value will fluctuate so that shares may be worth more or less than their original cost when redeemed. Fund performance changes over time and current performance may be higher or lower than stated. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The operating expense ratios may vary in future years. For more current information please call Davis Funds Investor Services at 1-800-279-0279.

Davis Opportunity Fund made a favorable investment in an initial public offering (IPO), which had a material impact on the investment performance, adding approximately 2% to the Fund's total return in 2010. The rapid appreciation was an unusual occurrence and such performance may not continue in the future.

*Reflects 4.75% front-end sales charge.

†Because Class B shares automatically convert to Class A shares after 7 years, the “10-Year” and “Since Inception” returns for Class B reflect Class A performance for the period after conversion.

**Includes any applicable contingent deferred sales charge.

***Inception return is from 12/01/94.

DAVIS SERIES, INC.	Management’s Discussion of Fund Performance
DAVIS GOVERNMENT BOND FUND

Performance Overview

Davis Government Bond Fund’s Class A shares returned 1.95% on net asset value for the year ended December 31, 2010. Over the same time period, the Citigroup U.S. Treasury/Agency 1-3 Year Index (“Index”) returned 2.34%. The Fund’s investment strategy, under normal circumstances, is to invest exclusively in U.S. Government securities and repurchase agreements, collateralized by U.S. Government securities, with a weighted average maturity of three years or less.

Factors Impacting the Fund’s Performance

The Fund’s Class A shares out-performed the Index before expenses. The most important contributor1 to the Fund’s performance relative to the Index was that the Fund was invested heavily in mortgage-backed securities. For securities maturing within one to three years, mortgage-backed securities, on average, out-performed both treasury and agency securities. In particular, the Fund benefited as home owners pre-paid or refinanced their mortgages.

Davis Government Bond Fund’s investment objective is current income. There can be no assurance that the Fund will achieve its objective. Davis Government Bond Fund’s principal risks are: variable current income, interest rate sensitivity, extension and prepayment risk, and fees and expenses risk. See the prospectus for a full description of each risk.

1 A contribution to or detraction from the Fund’s performance is a product both of appreciation or depreciation and weighting within the Fund. For example, a 5% holding that rises 20% has twice as much impact as a 1% holding that rises 50%.

DAVIS SERIES, INC.	Management’s Discussion of Fund Performance
DAVIS GOVERNMENT BOND FUND - (CONTINUED)

Comparison of a $10,000 investment in Davis Government Bond Fund Class A versus the Citigroup U.S. Treasury/Agency 1-3 Year Index over 10 years for an investment made on December 31, 2000

Average Annual Total Return for periods ended December 31, 2010

Fund & Benchmark Index	1-Year	5-Year	10-Year	Since Inception	Inception Date	Gross Expense Ratio	Net Expense Ratio
Class A - without sales charge	1.95%	3.77%	3.47%	4.35%	12/01/94	0.75%	0.75%
Class A - with sales charge	(2.86)%	2.78%	2.97%	4.03%	12/01/94	0.75%	0.75%
Class B†, **	(3.12)%	2.54%	2.96%	5.48%	05/01/84	1.65%	1.65%
Class C**	0.11%	2.93%	2.69%	2.96%	08/19/97	1.56%	1.56%
Class Y	2.11%	3.82%	3.64%	3.65%	09/01/98	0.58%	0.58%
Citigroup U.S. Treasury/Agency 1-3 Year Index***	2.34%	4.28%	4.05%	5.04%

The Citigroup U.S. Treasury/Agency 1-3 Year Index is a recognized unmanaged index of short-term U.S. Government securities’ performance. Investments cannot be made directly in the Index.

The performance data for Davis Government Bond Fund contained in this report represents past performance and assumes that all distributions were reinvested, and should not be considered as an indication of future performance from an investment in the Fund today. The investment return and principal value will fluctuate so that shares may be worth more or less than their original cost when redeemed. Fund performance changes over time and current performance may be higher or lower than stated. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The operating expense ratios may vary in future years. For more current information please call Davis Funds Investor Services at 1-800-279-0279.

*Reflects 4.75% front-end sales charge.

**Includes any applicable contingent deferred sales charge.

***Inception return is from 12/01/94.

DAVIS SERIES, INC.	Management’s Discussion of Fund Performance
DAVIS FINANCIAL FUND

Performance Overview

Davis Financial Fund’s Class A shares delivered a total return on net asset value of 11.25% for the year ended December 31, 2010. Over the same time period, the Standard & Poor’s 500® Index (“Index”) returned 15.06%. The Index’s banking, insurance, and diversified financial services industry groups1 turned in positive performances, but the Index’s financial sector holdings under-performed the Index as a whole.

Factors Impacting the Fund’s Performance

The Fund’s financial sector holdings out-performed the corresponding sector within the Index (up 13% versus up 12% for the Index). The Fund had a limited amount of assets invested in other sectors. These non-financial holdings, mostly in energy, industrials, and information technology, overall detracted2 from performance relative to the Index. Canadian Natural Resources3 was among the most important contributors to performance. Sealed Air and D&B Corp. were among the most important detractors from performance. The Fund no longer owns Sealed Air.

The Fund’s diversified financial companies were the largest contributor to performance. The Fund’s diversified financial companies out-performed the corresponding industry group within the Index (up 14% versus up 4% for the Index). Julius Baer Group, Brookfield Asset Management, American Express, Oaktree, and Bank of New York Mellon were among the most important contributors to performance. Visa, Bank of America, and Charles Schwab were among the most important detractors from performance.

The Fund’s insurance companies under-performed the corresponding industry group within the Index (up 5% versus up 16% for the Index). Loews and Progressive were among the top contributors to performance. China Life Insurance was among the most important detractors from performance.

The Fund’s banking companies out-performed the corresponding industry group within the Index (up 25% versus up 20% for the Index). Wells Fargo and State Bank of India were among the most important contributors to performance.

The Fund had approximately 30% of its net assets invested in foreign companies at December 31, 2010. As a whole, those companies out-performed the Fund’s domestic holdings.

Davis Financial Fund’s investment objective is long-term growth of capital. There can be no assurance that the Fund will achieve its objective. Davis Financial Fund’s principal risks are: market risk, company risk, concentrated portfolio risk, financial services risk, focused portfolio risk, under $10 billion market capitalization risk, foreign country risk, headline risk, interest rate sensitivity, credit risk, and fees and expenses risk. See the prospectus for a full description of each risk.

Davis Financial Fund concentrates its investments in the financial sector, and it may be subject to greater risks than a fund that does not concentrate its investments in a particular sector. The Fund’s investment performance, both good and bad, is expected to reflect the economic performance of the financial sector more than a fund that does not concentrate its portfolio.

1 The companies included in the Standard & Poor’s 500® Index are divided into ten sectors. One or more industry groups make up a sector.

2 A company’s or sector’s contribution to or detraction from the Fund’s performance is a product both of its appreciation or depreciation and its weighting within the Fund. For example, a 5% holding that rises 20% has twice as much impact as a 1% holding that rises 50%.

3 This Management Discussion of Fund Performance discusses a number of individual companies. The information provided in this report does not provide information reasonably sufficient upon which to base an investment decision and should not be considered a recommendation to purchase or sell any particular security. The Schedule of Investments lists the Fund’s holdings of each company discussed.

DAVIS SERIES, INC.	Management’s Discussion of Fund Performance
DAVIS FINANCIAL FUND - (CONTINUED)

Comparison of a $10,000 investment in Davis Financial Fund Class A versus the Standard & Poor’s 500® Index over 10 years for an investment made on December 31, 2000

Average Annual Total Return for periods ended December 31, 2010

Fund & Benchmark Index	1-Year	5-Year	10-Year	Since Inception	Inception Date	Gross Expense Ratio	Net Expense Ratio
Class A - without sales charge	11.25%	(0.14)%	1.94%	12.00%	05/01/91	0.95%	0.95%
Class A - with sales charge	5.98%	(1.10)%	1.45%	11.73%	05/01/91	0.95%	0.95%
Class B†, **	6.00%	(1.43)%	1.31%	10.33%	12/27/94	2.07%	2.07%
Class C**	9.26%	(1.01)%	1.05%	4.37%	08/12/97	1.86%	1.86%
Class Y	11.37%	(0.02)%	2.09%	6.50%	03/10/97	0.86%	0.86%
S&P 500® Index***	15.06%	2.29%	1.41%	8.47%

The Standard & Poor’s 500® Index is an unmanaged index of 500 selected common stocks, most of which are listed on the New York Stock Exchange. The Index is adjusted for dividends, weighted towards stocks with large market capitalizations, and represents approximately two-thirds of the total market value of all domestic common stocks. Investments cannot be made directly in the Index.

The performance data for Davis Financial Fund contained in this report represents past performance and assumes that all distributions were reinvested, and should not be considered as an indication of future performance from an investment in the Fund today. The investment return and principal value will fluctuate so that shares may be worth more or less than their original cost when redeemed. Fund performance changes over time and current performance may be higher or lower than stated. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The operating expense ratios may vary in future years. For more current information please call Davis Funds Investor Services at 1-800-279-0279.

In 2009, Davis Financial Fund received a favorable class action settlement from a company that it no longer owns. This settlement had a material impact on the investment performance of the Fund, adding approximately 1% to the Fund’s total return in 2009. This was a one-time event that is unlikely to be repeated.

*Reflects 4.75% front-end sales charge.

**Includes any applicable contingent deferred sales charge.

***Inception return is from 05/01/91.

DAVIS SERIES, INC.	Management’s Discussion of Fund Performance
DAVIS APPRECIATION & INCOME FUND

Performance Overview

Davis Appreciation & Income Fund’s Class A shares delivered a total return on net asset value of 20.34% for the year ended December 31, 2010. Over the same time period, the Standard & Poor’s 500® Index (“Index”) returned 15.06%. All sectors1 within the Index registered increases over the year. Consumer discretionary, industrials, and materials were the sectors within Index that increased the most. Health care and utilities were the sectors within the Index that increased the least.

Factors Impacting the Fund’s Performance

The Fund had more invested in common stock than in any other asset category, and they were the most important contributor2 to the Fund’s performance. The Fund’s common stock holdings out-performed the Index (up 21% versus up 15% for the Index). The Fund’s common stock holdings in Whole Foods3, Tyson Foods, Freeport-McMoRan, Universal Health Services, and Fairchild Semiconductor were among the most important contributors to performance. The Fund’s common stock holdings in School Specialty, Bank of America, AES Corp., Quanta Services, Masco, and Avon were among the most important detractors from performance.

The Fund also held significant investments in convertible bonds and preferred stock. The Fund’s convertible bond and preferred stock holdings contributed to the Fund out-performing the Index. The Fund’s convertible bond holdings in Forest City Enterprises and Valeant Pharmaceuticals were among the most important contributors to performance. The Fund’s convertible bond holding in Waste Connections was among the most important detractors from performance. The Fund no longer owns the Waste Connections bond.

Davis Appreciation & Income Fund’s investment objective is total return through a combination of growth and income. There can be no assurance that the Fund will achieve its objective. Davis Appreciation & Income Fund’s principal risks are: market risk, company risk, under $10 billion market capitalization risk, foreign country risk, headline risk, interest rate sensitivity, extension and prepayment risk, credit risk, changes in debt rating, variable current income, overburdened issuers, priority, difficult to resell, and fees and expenses risk. See the prospectus for a full description of each risk.

1 The companies included in the Standard & Poor’s 500® Index are divided into ten sectors. One or more industry groups make up a sector.

DAVIS SERIES, INC.	Management’s Discussion of Fund Performance
DAVIS APPRECIATION & INCOME FUND - (CONTINUED)

Comparison of a $10,000 investment in Davis Appreciation & Income Fund Class A versus the Standard & Poor’s 500® Index over 10 years for an investment made on December 31, 2000

Average Annual Total Return for periods ended December 31, 2010

Fund & Benchmark Index	1-Year	5-Year	10-Year	Since Inception	Inception Date	Gross Expense Ratio	Net Expense Ratio
Class A - without sales charge	20.34%	4.25%	5.54%	8.90%	05/01/92	0.94%	0.94%
Class A - with sales charge	14.63%	3.24%	5.03%	8.62%	05/01/92	0.94%	0.94%
Class B†, **	15.31%	3.00%	4.88%	8.43%	02/03/95	1.85%	1.85%
Class C**	18.43%	3.41%	4.64%	4.53%	08/12/97	1.76%	1.76%
Class Y	20.66%	4.52%	5.79%	7.23%	11/13/96	0.73%	0.73%
S&P 500® Index***	15.06%	2.29%	1.41%	8.29%

The Standard & Poor’s 500® Index is an unmanaged index of 500 selected common stocks, most of which are listed on the New York Stock Exchange. The Index is adjusted for dividends, weighted towards stocks with large market capitalization, and represents approximately two-thirds of the total market value of all domestic common stocks. Investments cannot be made directly in the Index.

The performance data for Davis Appreciation & Income Fund contained in this report represents past performance and assumes that all distributions were reinvested, and should not be considered as an indication of future performance from an investment in the Fund today. The investment return and principal value will fluctuate so that shares may be worth more or less than their original cost when redeemed. Fund performance changes over time and current performance may be higher or lower than stated. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The operating expense ratios may vary in future years. For more current information please call Davis Funds Investor Services at 1-800-279-0279.

*Reflects 4.75% front-end sales charge.

**Includes any applicable contingent deferred sales charge.

***Inception return is from 05/01/92.

DAVIS SERIES, INC.	Management’s Discussion of Fund Performance
DAVIS REAL ESTATE FUND

Performance Overview

Davis Real Estate Fund’s Class A shares delivered a total return on net asset value of 20.09% for the year ended December 31, 2010. Over the same time period, the Wilshire U.S. Real Estate Securities Index (“Index”) returned 29.12%. Every sub-industry1 within the Index delivered positive returns. Real estate operating companies, retail REITs, and residential REITs delivered the strongest performances while office REITs, industrial REITs, and diversified REITs delivered the weakest (but still positive) performances.

Factors Impacting the Fund’s Performance

The Fund’s retail REITs were the most important contributor2 to performance. The Fund’s retail REITs under-performed the corresponding sub-industry within the Index (up 32% versus up 33% for the Index) and had a lower relative average weighting (13% versus 24% for the Index). Regency Centers3 and CBL & Associates were among the most important contributors to performance.

The Fund had more invested in office REITs than in any other sub-industry and they were an important contributor to the Fund’s absolute performance. However, office REITs were the most important detractor from performance relative to the Index. The Fund’s office REITs under-performed the corresponding sector within the Index (up 12% versus up 17% for the Index) and had a higher relative average weighting (32% versus 17% for the Index) in this weaker performing sub-industry. Boston Properties and Alexandria Real Estate were among the most important contributors to performance. DuPont Fabros Technology, Coresite Realty, and Corporate Office Properties were among the most important detractors from performance.

Residential REITs were also an important contributor to the Fund’s absolute performance, but similar to office REITs, were also an important detractor from performance relative to the Index. The Fund’s residential REITs under-performed the corresponding sub-industry within the Index (up 33% versus up 46% for the Index) and had a lower relative average weighting (11% versus 17% for the Index) in this stronger performing sub-industry. Essex Property Trust and American Campus were among the most important contributors to performance.

Forest City Enterprises was the single most important contributor to the Fund’s performance. The Fund benefited from both its large investment in Forest City Enterprises (approximately 8% at December 31, 2010) and also its strong investment performance (up 42%). Cousins Properties and ProLogis were among the most important detractors from performance. The Fund no longer owns Cousins Properties or ProLogis.

Davis Real Estate Fund’s investment objective is total return through a combination of growth and income. There can be no assurance that the Fund will achieve its objective. Davis Real Estate Fund’s principal risks are: market risk, company risk, concentrated portfolio risk, real estate portfolio risk, focused portfolio risk, under $10 billion market capitalization risk, foreign country risk, headline risk, variable current income risk, and fees and expenses risk. See the prospectus for a full description of each risk.

Davis Real Estate Fund concentrates its investments in the real estate sector, and it may be subject to greater risks than a fund that does not concentrate its investments in a particular sector. The Fund’s investment performance, both good and bad, is expected to reflect the economic performance of the real estate sector much more than a fund that does not concentrate its portfolio.

Davis Real Estate Fund is allowed to focus its investments in fewer companies, and it may be subject to greater risks than a more diversified fund that is not allowed to focus its investments in a few companies. Should the portfolio manager determine that it is prudent to focus the Fund’s portfolio in a few companies, the Fund’s investment performance, both good and bad, is expected to reflect the economic performance of its more focused portfolio.

1 The companies included in the Wilshire U.S. Real Estate Securities Index are divided into eight sub-industries.

DAVIS SERIES, INC.	Management’s Discussion of Fund Performance
DAVIS REAL ESTATE FUND - (CONTINUED)

Comparison of a $10,000 investment in Davis Real Estate Fund Class A versus the Standard & Poor’s 500® Index and the Wilshire U.S. Real Estate Securities Index over 10 years for an investment made on December 31, 2000

Average Annual Total Return for periods ended December 31, 2010

Fund & Benchmark Indices	1-Year	5-Year	10-Year	Since Inception	Inception Date	Gross Expense Ratio	Net Expense Ratio
Class A - without sales charge	20.09%	(0.76)%	8.32%	9.63%	01/03/94	1.11%	1.11%
Class A - with sales charge	14.37%	(1.72)%	7.80%	9.32%	01/03/94	1.11%	1.11%
Class B†, **	14.73%	(1.94)%	7.74%	9.33%	12/27/94	2.20%	2.20%
Class C**	18.07%	(1.55)%	7.50%	6.04%	08/13/97	1.92%	1.92%
Class Y	20.52%	(0.41)%	8.73%	8.67%	11/08/96	0.77%	0.77%
S&P 500® Index***	15.06%	2.29%	1.41%	8.05%
Wilshire U.S. Real Estate Securities Index***	29.12%	2.32%	10.34%	10.30%

The Standard & Poor’s 500® Index is an unmanaged index of 500 selected common stocks, most of which are listed on the New York Stock Exchange. The Index is adjusted for dividends, weighted towards stocks with large market capitalization, and represents approximately two-thirds of the total market value of all domestic common stocks. Investments cannot be made directly in the Index.

The Wilshire U.S. Real Estate Securities Index is a broad measure of the performance of publicly traded real estate securities. It reflects no deduction for fees or expenses. Investments cannot be made directly in the Index.

The performance data for Davis Real Estate Fund contained in this report represents past performance and assumes that all distributions were reinvested, and should not be considered as an indication of future performance from an investment in the Fund today. The investment return and principal value will fluctuate so that shares may be worth more or less than their original cost when redeemed. Fund performance changes over time and current performance may be higher or lower than stated. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The operating expense ratios may vary in future years. For more current information please call Davis Funds Investor Services at 1-800-279-0279.

*Reflects 4.75% front-end sales charge.

**Includes any applicable contingent deferred sales charge.

***Inception return is from 01/03/94.

DAVIS SERIES, INC.	Fund Overview
DAVIS OPPORTUNITY FUND	December 31, 2010

Portfolio Composition		Industry Weightings
(% of Fund’s 12/31/10 Net Assets)		(% of 12/31/10 Stock Holdings)
			Fund	Russell 3000®
Common Stock (U.S.)	73.03%	Information Technology	19.84%	18.35%
Common Stock (Foreign)	19.17%	Health Care	18.58%	11.26%
Stock Warrants	0.59%	Materials	10.97%	4.32%
Short-Term Investments	7.18%	Food, Beverage & Tobacco	9.33%	4.98%
Other Assets & Liabilities	0.03%	Diversified Financials	7.22%	6.50%
	100.00%	Energy	7.08%	11.25%
		Capital Goods	5.09%	8.60%
		Food & Staples Retailing	4.14%	1.98%
		Insurance	3.45%	3.88%
		Banks	3.32%	3.38%
		Consumer Services	3.27%	2.20%
		Consumer Durables & Apparel	2.87%	1.40%
		Transportation	1.97%	2.00%
		Media	1.73%	3.08%
		Other	1.14%	16.82%
			100.00%	100.00%

Top 10 Long-Term Holdings

(% of Fund’s 12/31/10 Net Assets)


Google Inc., Class A	Software & Services	4.20%
Johnson & Johnson	Pharmaceuticals, Biotechnology & Life Sciences	4.07%
Oaktree Capital Group LLC, Class A	Diversified Financial Services	3.98%
Merck & Co., Inc.	Pharmaceuticals, Biotechnology & Life Sciences	3.93%
CVS Caremark Corp.	Food & Staples Retailing	3.85%
Texas Instruments Inc.	Semiconductors & Semiconductor Equipment	3.65%
Sino-Forest Corp.	Materials	3.51%
Coca-Cola Co.	Food, Beverage & Tobacco	3.24%
Microsoft Corp.	Software & Services	3.01%
Yum! Brands, Inc.	Consumer Services	2.96%

DAVIS SERIES, INC.	Fund Overview
DAVIS OPPORTUNITY FUND - (CONTINUED)	December 31, 2010

New Positions Added (01/01/10-12/31/10)

(Highlighted positions are those greater than 1.50% of Fund’s 12/31/10 total net assets)

Security	Industry	Date of 1st Purchase	% of Fund’s 12/31/10 Net Assets
Altera Corp.	Semiconductors & Semiconductor
	Equipment	03/30/10	0.67%
Baxter International Inc.	Health Care Equipment & Services	04/22/10	1.59%
Coca-Cola Co.	Food, Beverage & Tobacco	02/26/10	3.24%
Kraft Foods Inc., Class A	Food, Beverage & Tobacco	12/17/10	2.46%
Lockheed Martin Corp.	Capital Goods	01/19/10	0.81%
Nestle S.A.	Food, Beverage & Tobacco	03/08/10	0.93%
Sherwin-Williams Co.	Materials	03/23/10	1.56%
U.S. Bancorp	Commercial Banks	09/23/10	0.25%
Wells Fargo & Co., Stock Warrants,
strike price $34.01, expires 10/28/18	Commercial Banks	05/21/10	0.59%
W. R. Berkley Corp.	Property & Casualty Insurance	04/07/10	–
Yingde Gases Group Co. Ltd.	Materials	04/07/10	0.79%
Youku.com Inc., ADR	Software & Services	12/08/10	1.72%

Positions Closed (01/01/10-12/31/10)

(Gains and losses greater than $400,000 are highlighted)

		Date of	Realized
Security	Industry	Final Sale	Gain (Loss)
American Tower Corp., Class A	Telecommunication Services	10/27/10		$	513,262
Aon Corp.	Insurance Brokers	12/27/10			211,782
Brown & Brown, Inc.	Insurance Brokers	07/19/10			(50,497)
CareFusion Corp.	Health Care Equipment & Services	12/27/10			163,560
CarMax, Inc.	Retailing	12/28/10			344,677
Cisco Systems, Inc.	Technology Hardware & Equipment	10/27/10			351,951
CME Group Inc.	Diversified Financial Services	12/27/10			115,598
Comcast Corp., Special Class A	Media	02/26/10			(1,114,446)
Costco Wholesale Corp.	Food & Staples Retailing	12/27/10			267,526
D&B Corp.	Commercial & Professional Services	01/20/10			104,496
DIRECTV, Class A	Media	01/21/10			445,269
E*TRADE Financial Corp.	Capital Markets	04/26/10			(1,651,637)
Everest Re Group, Ltd.	Reinsurance	12/27/10			131,957
Exelon Corp.	Utilities	03/04/10			(71,696)
GAM Holding Ltd.	Capital Markets	01/20/10			34,457
Garmin Ltd.	Consumer Durables & Apparel	01/04/10			57,819
Johnson Controls, Inc.	Automobiles & Components	12/27/10			69,255
Julius Baer Group Ltd.	Capital Markets	01/20/10			84,159
Laboratory Corp. of America Holdings	Health Care Equipment & Services	12/27/10			2,069,493
Lagardere S.C.A.	Media	03/08/10			(596,540)
Level 3 Communications, Inc., Conv. Sr. Notes, 10.00%, 05/01/11	Telecommunication Services	05/27/10			93,520
Liberty Media Corp. - Interactive, Series A	Retailing	01/20/10			(384,245)
Liberty Media - Starz, Series A	Media	01/20/10			61,048
Millipore Corp.	Pharmaceuticals, Biotechnology &
	Life Sciences	07/15/10			773,226
NetEase.com Inc., ADR	Software & Services	12/08/10			205,533
News Corp., Class A	Media	02/26/10			(1,020,821)
Pargesa Holding S.A., Bearer Shares	Diversified Financial Services	12/08/10			757,854
RenaissanceRe Holdings Ltd.	Reinsurance	12/27/10			72,838
Ryanair Holdings PLC, ADR	Transportation	10/27/10			355,706
UnitedHealth Group Inc.	Health Care Equipment & Services	09/20/10			(830,387)
Walt Disney Co.	Media	08/19/10			5,876,122
W. R. Berkley Corp.	Property & Casualty Insurance	12/27/10			13,489

DAVIS SERIES, INC.	Fund Overview
DAVIS GOVERNMENT BOND FUND	December 31, 2010

Portfolio Composition		Industry Weightings
(% of Fund’s 12/31/10 Net Assets)		(% of 12/31/10 Fixed Income)

Fixed Income	97.35%	Collateralized Mortgage Obligations	66.68%
Short-Term Investments	2.74%	Fannie Mae Mortgage Pools	23.03%
Other Assets & Liabilities	(0.09)%	Freddie Mac Mortgage Pools	7.28%
	100.00%	Government Agency Notes	2.22%
		Ginnie Mae Mortgage Pools	0.59%
		Other Agencies	0.20%
			100.00%

Top 10 Fixed Income Holdings

(% of Fund’s 12/31/10 Net Assets)


Freddie Mac, 4.50%, 08/15/32	Collateralized Mortgage Obligations	3.27%
Freddie Mac, 4.00%, 09/15/18	Collateralized Mortgage Obligations	3.25%
Fannie Mae, 4.00%, 04/25/19	Collateralized Mortgage Obligations	3.22%
Ginnie Mae, 4.00%, 05/20/33	Collateralized Mortgage Obligations	3.20%
Freddie Mac, 4.00%, 01/15/28	Collateralized Mortgage Obligations	3.11%
Fannie Mae, 5.055%, 11/01/15, Pool No. 387686	Fannie Mae Mortgage Pools	3.10%
Fannie Mae, 3.00%, 12/01/20, Pool No. MA0605	Fannie Mae Mortgage Pools	3.07%
Ginnie Mae, 6.1478%, 04/20/37	Collateralized Mortgage Obligations	2.60%
Freddie Mac, 3.50%, 07/15/24	Collateralized Mortgage Obligations	2.49%
Freddie Mac, 0.6603%, 11/15/37	Collateralized Mortgage Obligations	2.42%

DAVIS SERIES, INC.	Fund Overview
DAVIS GOVERNMENT MONEY MARKET FUND	December 31, 2010

Portfolio Composition		Maturity Diversification
(% of Fund’s 12/31/10 Net Assets)		(% of 12/31/10 Portfolio Holdings)

Repurchase Agreements	49.58%	0-30 Days	72.78%
Federal Home Loan Bank	27.28%	31-90 Days	3.04%
Freddie Mac	10.89%	91-180 Days	12.36%
Fannie Mae	2.95%	181-397 Days	11.82%
Federal Farm Credit Bank	2.04%		100.00%
Other Agencies	0.19%
Other Assets & Liabilities	7.07%
	100.00%

The maturity dates of floating rate securities used in the Maturity Diversification chart are considered to be the effective maturities, based on the reset dates of the securities’ variable rates. See the Fund’s Schedule of Investments for a listing of the floating rate securities.

DAVIS SERIES, INC.	Fund Overview
DAVIS FINANCIAL FUND	December 31, 2010

Portfolio Composition		Industry Weightings
(% of Fund’s 12/31/10 Net Assets)		(% of 12/31/10 Stock Holdings)
			Fund	S&P 500®
Common Stock (U.S.)	69.35%	Diversified Financials	41.06%	7.53%
Common Stock (Foreign)	30.42%	Insurance	31.94%	3.90%
Short-Term Investments	0.04%	Banks	17.71%	3.10%
Other Assets & Liabilities	0.19%	Energy	6.75%	12.03%
	100.00%	Commercial & Professional Services	2.54%	0.60%
		Information Technology	–	18.65%
		Health Care	–	10.91%
		Capital Goods	–	8.33%
		Food, Beverage & Tobacco	–	5.87%
		Other	–	29.08%
			100.00%	100.00%

Top 10 Long-Term Holdings

(% of Fund’s 12/31/10 Net Assets)


Transatlantic Holdings, Inc.	Reinsurance	8.70%
Loews Corp.	Multi-line Insurance	8.24%
American Express Co.	Consumer Finance	7.89%
State Bank of India Ltd., GDR	Commercial Banks	7.78%
Wells Fargo & Co.	Commercial Banks	7.48%
Canadian Natural Resources Ltd.	Energy	6.73%
Oaktree Capital Group LLC, Class A	Diversified Financial Services	5.84%
Bank of New York Mellon Corp.	Capital Markets	5.27%
Julius Baer Group Ltd.	Capital Markets	5.19%
Markel Corp.	Property & Casualty Insurance	4.46%

New Positions Added (01/01/10-12/31/10)

(Highlighted positions are those greater than 0.40% of Fund’s 12/31/10 total net assets)

Security	Industry	Date of 1st Purchase	% of Fund’s 12/31/10 Net Assets
SKBHC Holdings LLC	Commercial Banks	11/08/10	0.48%
U.S. Bancorp	Commercial Banks	02/11/10	0.46%

Positions Closed (01/01/10-12/31/10)

(Gains greater than $3,000,000 are highlighted)

Security	Industry	Date of Final Sale	Realized Gain
FPIC Insurance Group, Inc.	Property & Casualty Insurance	05/19/10	$	2,526,238
JPMorgan Chase & Co.	Diversified Financial Services	04/08/10		3,109,239
Sealed Air Corp.	Materials	02/01/10		2,252,723

DAVIS SERIES, INC.	Fund Overview
DAVIS APPRECIATION & INCOME FUND	December 31, 2010

Portfolio Composition		Industry Weightings
(% of Fund’s 12/31/10 Net Assets)		(% of 12/31/10 Long-Term Portfolio)
			Fund	S&P 500®
Common Stock	51.39%	Energy	11.85%	12.03%
Convertible Bonds	32.06%	Capital Goods	11.31%	8.33%
Preferred Stocks	12.03%	Materials	11.00%	3.74%
Corporate Bonds	3.07%	Real Estate	10.95%	1.53%
Short-Term Investments	1.44%	Diversified Financials	9.35%	7.53%
Other Assets & Liabilities	0.01%	Information Technology	8.10%	18.65%
	100.00%	Commercial & Professional Services	6.79%	0.60%
		Retailing	6.07%	3.71%
		Food, Beverage & Tobacco	5.59%	5.87%
		Utilities	4.54%	3.30%
		Health Care	4.53%	10.91%
		Food & Staples Retailing	3.04%	2.36%
		Other	2.71%	15.91%
		Household & Personal Products	2.14%	2.41%
		Media	2.03%	3.12%
			100.00%	100.00%

Top 10 Long-Term Holdings

(% of Fund’s 12/31/10 Net Assets)


Forest City Enterprises, Inc., Conv. Sr. Notes, 3.625%, 10/15/14	Real Estate	6.11%
Kohl's Corp.	Retailing	4.22%
Citigroup Inc., 7.50%, Conv. Pfd., T-DECS	Diversified Financial Services	3.83%
Tyson Foods, Inc., Conv. Sr. Notes, 3.25%, 10/15/13	Food, Beverage & Tobacco	3.62%
Devon Energy Corp.	Energy	3.61%
United States Steel Corp., Conv. Sr. Notes, 4.00%, 05/15/14	Materials	3.40%
Quanta Services, Inc.	Capital Goods	3.39%
Whole Foods Market, Inc.	Food & Staples Retailing	2.99%
AES Trust III, 6.75%, Conv. Pfd.	Utilities	2.98%
Allegheny Technologies, Inc., Conv. Sr. Notes, 4.25%, 06/01/14	Materials	2.86%

DAVIS SERIES, INC.	Fund Overview
DAVIS APPRECIATION & INCOME FUND - (CONTINUED)	December 31, 2010

New Positions Added (01/01/10-12/31/10)

(Highlighted positions are those greater than 2.00% of Fund’s 12/31/10 total net assets)

Security	Industry	Date of 1st Purchase	% of Fund’s 12/31/10 Net Assets
Citigroup Capital XII, 8.50%, TRUPS	Diversified Financial Services	03/10/10	0.67%
General Motors Co., 4.75%, Series B, Conv. Pfd	Automobiles & Components	11/18/10	0.24%
Toll Brothers, Inc.	Consumer Durables & Apparel	08/26/10	0.27%
Transocean Ltd.	Energy	05/05/10	2.33%
Transocean Ltd., Conv. Sr. Notes, 1.50%, 12/15/37	Energy	05/06/10	2.64%
United Rentals, Inc., Conv. Sr. Notes, 4.00%, 11/15/15	Capital Goods	08/12/10	1.25%

Positions Closed (01/01/10-12/31/10)

(Gains and losses greater than $1,000,000 are highlighted)

Security	Industry	Date of Final Sale	Realized Gain (Loss)
Allegheny Technologies, Inc.	Materials	05/21/10		$	2,207,103
Digital Realty Trust, Inc., 144A Conv. Sr. Notes, 4.125%, 08/15/26	Real Estate	03/31/10			940,474
News America Inc., Conv. Notes, Zero coupon, 3.38%, 02/28/21	Media	06/14/10			(127,603)
Reckson Operating Partnership, L.P., Conv. Sr. Notes, 4.00%, 06/15/25	Real Estate	06/16/10			10,569
School Specialty, Inc., Conv. Sub. Notes, 3.75%/Zero coupon, 08/01/23	Commercial & Professional Services	08/03/10			(696,112)
United Rentals, Inc.	Capital Goods	08/12/10			(2,182,759)
United Rentals North America Inc., Conv. Sr. Sub., 1.875%, 10/15/23	Capital Goods	10/20/10			(757,674)
Waste Connections, Inc., Conv. Sr. Notes, 3.75%, 04/01/26	Commercial & Professional Services	04/01/10			509,862

DAVIS SERIES, INC.	Fund Overview
DAVIS REAL ESTATE FUND	December 31, 2010

Portfolio Composition		Industry Weightings
(% of Fund’s 12/31/10 Net Assets)		(% of 12/31/10 Long-Term Portfolio)

				Wilshire U.S.
Common Stock	82.37%			Real Estate
Preferred Stock	9.31%		Fund	Securities Index
Convertible Bonds	3.05%	Office REITs	36.34%	15.55%
Short-Term Investments	5.04%	Residential REITs	11.26%	17.14%
Other Assets & Liabilities	0.23%	Real Estate Operating Companies	10.41%	2.24%
	100.00%	Retail REITs	9.86%	24.36%
		Specialized REITs	9.51%	25.88%
		Telecommunication Services	9.19%	–
		Other	7.36%	8.83%
		Industrial REITs	6.07%	6.00%
			100.00%	100.00%

Top 10 Long-Term Holdings

(% of Fund’s 12/31/10 Net Assets)


Forest City Enterprises, Inc., Class A	Real Estate Operating Companies	7.53%
American Campus Communities, Inc.	Residential REITs	5.71%
Alexandria Real Estate Equities, Inc.	Office REITs	5.35%
DuPont Fabros Technology Inc.	Office REITs	4.46%
Alexandria Real Estate Equities, Inc., 7.00%, Series D, Conv. Pfd.	Office REITs	3.86%
Regency Centers Corp.	Retail REITs	3.44%
Essex Property Trust, Inc.	Residential REITs	3.42%
Crown Castle International Corp.	Telecommunication Services	3.14%
Alexander & Baldwin, Inc.	Transportation	2.99%
SBA Communications Corp., Class A	Telecommunication Services	2.94%

DAVIS SERIES, INC.	Fund Overview
DAVIS REAL ESTATE FUND - (CONTINUED)	December 31, 2010

New Positions Added (01/01/10-12/31/10)

(Highlighted positions are those greater than 3.00% of Fund’s 12/31/10 total net assets)

Security	Industry	Date of 1st Purchase	% of Fund’s 12/31/10 Net Assets
American Tower Corp., Class A	Telecommunication Services	01/11/10	2.63%
AvalonBay Communities, Inc.	Residential REITs	01/20/10	–
Brookdale Senior Living Inc.	Real Estate Operating Companies	10/22/10	1.84%
CB Richard Ellis Group, Inc., Class A	Real Estate Services	10/26/10	1.12%
Coresite Realty Corp.	Office REITs	09/22/10	2.89%
Crown Castle International Corp.	Telecommunication Services	01/11/10	3.14%
DuPont Fabros Technology Inc.	Office REITs	05/13/10	4.46%
EastGroup Properties, Inc.	Industrial REITs	09/13/10	2.19%
Entertainment Properties Trust	Specialized REITs	01/22/10	2.89%
Highwoods Properties, Inc.	Office REITs	04/22/10	2.62%
SBA Communications Corp., Class A	Telecommunication Services	01/11/10	2.94%
Toll Brothers, Inc.	Homebuilding	08/26/10	0.63%
UDR, Inc.	Residential REITs	04/22/10	1.54%

Positions Closed (01/01/10-12/31/10)

(Gains and losses greater than $2,000,000 are highlighted)

		Date of	Realized
Security	Industry	Final Sale	Gain (Loss)
AvalonBay Communities, Inc.	Residential REITs	04/21/10	$	1,963,948
Brookfield Asset Management Inc., Class A	Capital Markets	03/03/10		(661,002)
CBL & Associates Properties, Inc.	Retail REITs	10/29/10		3,825,848
Cousins Properties, Inc.	Diversified REITs	07/19/10		(11,872,976)
Digital Realty Trust Inc., 8.50%, Series A	Office REITs	08/24/10		768,549
Equity Residential	Residential REITs	12/17/10		1,351,862
Host Hotels & Resorts Inc.	Specialized REITs	04/15/10		1,640,353
Macerich Co.	Retail REITs	01/07/10		205,666
ProLogis	Industrial REITs	01/28/10		1,390,430
ProLogis, Conv. Sr. Notes, 2.25%, 04/01/37	Industrial REITs	05/26/10		3,045,073

DAVIS SERIES, INC.

Expense Example

Example

As a shareholder of each Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchases and contingent deferred sales charges on redemptions; and (2) ongoing costs, including advisory and administrative fees, distribution and/or service (12b-1) fees, and other Fund expenses. The Expense Example is intended to help you understand your ongoing costs (in dollars) of investing in each Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The Expense Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period indicated, which for each class is for the six-month period ended December 31, 2010.

Actual Expenses

The information represented in the row entitled “Actual” provides information about actual account values and actual expenses. You may use the information in this row, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period. An annual maintenance fee of $15, charged on retirement plan accounts per Social Security Number, is not included in the Expense Example. This fee will be waived for accounts sharing the same Social Security Number if the accounts total at least $50,000 at Davis Funds. If this fee was included, the estimate of expenses you paid during the period would be higher, and your ending account value would be lower, by this amount.

Hypothetical Example for Comparison Purposes

The information represented in the row entitled “Hypothetical” provides information about hypothetical account values and hypothetical expenses based on each Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. An annual maintenance fee of $15, charged on retirement plan accounts per Social Security Number, is not included in the Expense Example. This fee will be waived for accounts sharing the same Social Security Number if the accounts total at least $50,000 at Davis Funds. If this fee was included, the estimate of expenses you paid during the period would be higher, and your ending account value would be lower, by this amount.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as front end or contingent deferred sales charges (loads). Therefore, the information in the row entitled “Hypothetical” is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

DAVIS SERIES, INC.

Expense Example – (Continued)

	Beginning Account Value (07/01/10)	Ending Account Value (12/31/10)	Expenses Paid During Period* (07/01/10-12/31/10)
Davis Opportunity Fund
Class A (annualized expense ratio 1.04%**)
Actual	$1,000.00	$1,258.32	$5.92
Hypothetical	$1,000.00	$1,019.96	$5.30
Class B (annualized expense ratio 1.97%**)
Actual	$1,000.00	$1,252.85	$11.19
Hypothetical	$1,000.00	$1,015.27	$10.01
Class C (annualized expense ratio 1.83%**)
Actual	$1,000.00	$1,253.13	$10.39
Hypothetical	$1,000.00	$1,015.98	$9.30
Class Y (annualized expense ratio 0.74%**)
Actual	$1,000.00	$1,260.27	$4.22
Hypothetical	$1,000.00	$1,021.48	$3.77

Davis Government Bond Fund
Class A (annualized expense ratio 0.77%**)
Actual	$1,000.00	$1,001.91	$3.89
Hypothetical	$1,000.00	$1,021.32	$3.92
Class B (annualized expense ratio 1.65%**)
Actual	$1,000.00	$995.59	$8.30
Hypothetical	$1,000.00	$1,016.89	$8.39
Class C (annualized expense ratio 1.56%**)
Actual	$1,000.00	$995.99	$7.85
Hypothetical	$1,000.00	$1,017.34	$7.93
Class Y (annualized expense ratio 0.58%**)
Actual	$1,000.00	$1,002.87	$2.93
Hypothetical	$1,000.00	$1,022.28	$2.96

Davis Government Money Market Fund
Class A, B, C, & Y (annualized expense ratio 0.23%**)
Actual	$1,000.00	$1,000.05	$1.16
Hypothetical	$1,000.00	$1,024.05	$1.17

Davis Financial Fund
Class A (annualized expense ratio 0.95%**)
Actual	$1,000.00	$1,199.19	$5.27
Hypothetical	$1,000.00	$1,020.42	$4.84
Class B (annualized expense ratio 2.06%**)
Actual	$1,000.00	$1,192.93	$11.39
Hypothetical	$1,000.00	$1,014.82	$10.46
Class C (annualized expense ratio 1.86%**)
Actual	$1,000.00	$1,193.61	$10.28
Hypothetical	$1,000.00	$1,015.83	$9.45
Class Y (annualized expense ratio 0.84%**)
Actual	$1,000.00	$1,200.30	$4.66
Hypothetical	$1,000.00	$1,020.97	$4.28

DAVIS SERIES, INC.

Expense Example – (Continued)

	Beginning Account Value (07/01/10)	Ending Account Value (12/31/10)	Expenses Paid During Period* (07/01/10-12/31/10)

Davis Appreciation & Income Fund
Class A (annualized expense ratio 0.93%**)
Actual	$1,000.00	$1,211.01	$5.18
Hypothetical	$1,000.00	$1,020.52	$4.74
Class B (annualized expense ratio 1.84%**)
Actual	$1,000.00	$1,205.82	$10.23
Hypothetical	$1,000.00	$1,015.93	$9.35
Class C (annualized expense ratio 1.75%**)
Actual	$1,000.00	$1,206.66	$9.73
Hypothetical	$1,000.00	$1,016.38	$8.89
Class Y (annualized expense ratio 0.75%**)
Actual	$1,000.00	$1,212.83	$4.18
Hypothetical	$1,000.00	$1,021.42	$3.82

Davis Real Estate Fund
Class A (annualized expense ratio 1.11%**)
Actual	$1,000.00	$1,153.36	$6.02
Hypothetical	$1,000.00	$1,019.61	$5.65
Class B (annualized expense ratio 2.21%**)
Actual	$1,000.00	$1,147.10	$11.96
Hypothetical	$1,000.00	$1,014.06	$11.22
Class C (annualized expense ratio 1.92%**)
Actual	$1,000.00	$1,148.57	$10.40
Hypothetical	$1,000.00	$1,015.53	$9.75
Class Y (annualized expense ratio 0.79%**)
Actual	$1,000.00	$1,155.12	$4.29
Hypothetical	$1,000.00	$1,021.22	$4.02


Hypothetical assumes 5% annual return before expenses.

*Expenses are equal to each Class's annualized operating expense ratio, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).

**The expense ratios reflect the impact, if any, of the reduction of expenses paid indirectly and of certain reimbursements and/or waivers from the Adviser.

DAVIS SERIES, INC.	Schedule of Investments
DAVIS OPPORTUNITY FUND	December 31, 2010

						Shares		Value (Note 1)
COMMON STOCK – (92.20%)
	CONSUMER DISCRETIONARY – (7.30%)
		Consumer Durables & Apparel – (2.66%)
				Hunter Douglas NV (Netherlands)			309,979	$	16,390,880
		Consumer Services – (3.03%)
				H&R Block, Inc.			35,520		423,043
				Yum! Brands, Inc.			372,400		18,266,220
									18,689,263

		Media – (1.61%)
				Grupo Televisa S.A., ADR (Mexico)*			382,460		9,917,188
					Total Consumer Discretionary				44,997,331
	CONSUMER STAPLES – (12.51%)
		Food & Staples Retailing – (3.85%)
				CVS Caremark Corp.			681,530		23,696,798
		Food, Beverage & Tobacco – (8.66%)
				Coca-Cola Co.			304,030		19,996,053
				Heineken Holding NV (Netherlands)			214,095		9,305,244
				Kraft Foods Inc., Class A			481,700		15,178,367
				Mead Johnson Nutrition Co.			50,620		3,151,095
				Nestle S.A. (Switzerland)			97,790		5,726,206
									53,356,965
					Total Consumer Staples				77,053,763
	ENERGY – (6.57%)
				Devon Energy Corp.			82,402		6,469,381
				Occidental Petroleum Corp.			107,374		10,533,390
				Tenaris S.A., ADR (Argentina)			215,240		10,542,455
				Transocean Ltd. *			186,469		12,961,460
					Total Energy				40,506,686
	FINANCIALS – (12.38%)
		Banks – (2.49%)
			Commercial Banks – (2.49%)
				Banco Santander Brasil S.A., ADS (Brazil)			178,760		2,431,136
				U.S. Bancorp			57,500		1,550,775
				Wells Fargo & Co.			366,100		11,345,439
									15,327,350

		Diversified Financials – (6.70%)
			Capital Markets – (2.72%)
				Bank of New York Mellon Corp.			359,210		10,848,142
				Charles Schwab Corp.			344,530		5,894,908
									16,743,050

			Diversified Financial Services – (3.98%)
				Oaktree Capital Group LLC, Class A (a)			691,250		24,539,375
									41,282,425

		Insurance – (3.19%)
			Property & Casualty Insurance – (2.34%)
				Berkshire Hathaway Inc., Class B *			59,391		4,757,813
				Markel Corp. *			25,547		9,660,087
									14,417,900

DAVIS SERIES, INC.	Schedule of Investments
DAVIS OPPORTUNITY FUND - (CONTINUED)	December 31, 2010

						Shares		Value (Note 1)
COMMON STOCK – (CONTINUED)
	FINANCIALS – (CONTINUED)
		Insurance – (Continued)
			Reinsurance – (0.85%)
				Transatlantic Holdings, Inc.			102,345	$	5,283,049
									19,700,949
					Total Financials				76,310,724
	HEALTH CARE – (17.24%)
		Health Care Equipment & Services – (6.10%)
				Baxter International Inc.			193,330		9,786,364
				Becton, Dickinson and Co.			188,934		15,968,702
				IDEXX Laboratories, Inc. *			170,650		11,818,366
									37,573,432

		Pharmaceuticals, Biotechnology & Life Sciences – (11.14%)
				Agilent Technologies, Inc. *			243,444		10,085,885
				Johnson & Johnson			405,030		25,051,105
				Merck & Co., Inc.			671,416		24,197,833
				Pfizer Inc.			533,670		9,344,562
									68,679,385
					Total Health Care				106,252,817
	INDUSTRIALS – (7.07%)
		Capital Goods – (4.73%)
				ABB Ltd., ADR (Switzerland)			203,670		4,572,392
				Blount International, Inc. *			692,778		10,918,181
				Lockheed Martin Corp.			71,518		4,999,823
				Shaw Group Inc. *			252,170		8,631,779
									29,122,175

		Commercial & Professional Services – (0.51%)
				Iron Mountain Inc.			126,340		3,159,764
		Transportation – (1.83%)
				Clark Holdings, Inc. *(b)			958,000		258,660
				Kuehne & Nagel International AG (Switzerland)			79,296		11,025,112
									11,283,772
					Total Industrials				43,565,711
	INFORMATION TECHNOLOGY – (18.41%)
		Semiconductors & Semiconductor Equipment – (4.32%)
				Altera Corp.			115,930		4,126,528
				Texas Instruments Inc.			692,950		22,520,875
									26,647,403

		Software & Services – (11.92%)
				Activision Blizzard, Inc.			638,610		7,941,115
				Google Inc., Class A *			43,563		25,873,155
				International Business Machines Corp.			18,444		2,706,841
				Microsoft Corp.			663,860		18,528,333
				SAP AG, ADR (Germany)			154,351		7,811,704
				Youku.com Inc., ADR (China)*			302,650		10,595,777
									73,456,925

DAVIS SERIES, INC.	Schedule of Investments
DAVIS OPPORTUNITY FUND - (CONTINUED)	December 31, 2010

							Shares/Principal			Value (Note 1)
COMMON STOCK – (CONTINUED)
	INFORMATION TECHNOLOGY – (CONTINUED)
		Technology Hardware & Equipment – (2.17%)
			Harris Corp.						93,890	$	4,253,217
			Hewlett-Packard Co.						216,054		9,095,873
											13,349,090
						Total Information Technology					113,453,418
	MATERIALS – (10.18%)
			Monsanto Co.						141,080		9,824,811
			Sherwin-Williams Co.						115,060		9,636,275
			Sigma-Aldrich Corp.						251,750		16,766,550
			Sino-Forest Corp. (Canada)*						923,330		21,627,633
			Yingde Gases Group Co. Ltd. (China)*						5,515,930		4,861,070
						Total Materials					62,716,339
	TELECOMMUNICATION SERVICES – (0.54%)
			America Movil SAB de C.V., Series L, ADR (Mexico)						57,820		3,315,399
						Total Telecommunication Services					3,315,399

					TOTAL COMMON STOCK – (Identified cost $445,716,015)						568,172,188

STOCK WARRANTS – (0.59%)
	FINANCIALS – (0.59%)
	Banks – (0.59%)
	Commercial Banks – (0.59%)
			Wells Fargo & Co., strike price $34.01, expires 10/28/18 *						330,600		3,672,966

					TOTAL STOCK WARRANTS – (Identified cost $2,628,772)						3,672,966

SHORT-TERM INVESTMENTS – (7.18%)
			Banc of America Securities LLC Joint Repurchase Agreement, 0.25%, 01/03/11, dated 12/31/10, repurchase value of $8,506,177 (collateralized by: U.S. Government agency mortgages in a pooled cash account, 2.104%-6.50%, 06/01/25-12/01/40, total market value $8,676,120)					$	8,506,000		8,506,000
			Goldman, Sachs & Co. Joint Repurchase Agreement, 0.16%, 01/03/11, dated 12/31/10, repurchase value of $10,206,136 (collateralized by: U.S. Government agency mortgages in a pooled cash account, 3.50%-6.50%, 12/01/25-01/01/41, total market value $10,410,120)						10,206,000		10,206,000
			Mizuho Securities USA Inc. Joint Repurchase Agreement, 0.24%, 01/03/11, dated 12/31/10, repurchase value of $25,516,510 (collateralized by: U.S. Government agency obligations in a pooled cash account, 3.125%-7.50%, 01/31/12-05/15/37, total market value $26,026,320)						25,516,000		25,516,000

					TOTAL SHORT-TERM INVESTMENTS – (Identified cost $44,228,000)						44,228,000


				Total Investments – (99.97%) – (Identified cost $492,572,787) – (c)							616,073,154
				Other Assets Less Liabilities – (0.03%)							189,434
Net Assets – (100.00%)										$	616,262,588

DAVIS SERIES, INC.	Schedule of Investments
DAVIS OPPORTUNITY FUND - (CONTINUED)	December 31, 2010

ADR: American Depositary Receipt

ADS: American Depositary Share

*		Non-Income producing security.

(a)	Restricted Security – See Note 8 of the Notes to Financial Statements.

(b)		Affiliated Company. Represents ownership of at least 5% of the voting securities of the issuer and is an affiliate, as defined in the Investment Company Act of 1940, at or during the year ended December 31, 2010. The aggregate fair value of the securities of affiliated companies held by the Fund as of December 31, 2010, amounts to $258,660. Transactions during the period in which the issuers were affiliates are as follows:

	Security		Shares December 31, 2009		Gross Additions		Gross Reductions		Shares December 31, 2010		Dividend Income
	Clark Holdings, Inc.		958,000		–		–		958,000	$	–

(c)	Aggregate cost for federal income tax purposes is $506,268,024. At December 31, 2010 unrealized appreciation (depreciation) of securities for federal income tax purposes is as follows:

		Unrealized appreciation		$	126,645,301
		Unrealized depreciation			(16,840,171)
			Net unrealized appreciation	$	109,805,130


See Notes to Financial Statements

DAVIS SERIES, INC.	Schedule of Investments
DAVIS GOVERNMENT BOND FUND	December 31, 2010

				Principal			Value (Note 1)
GOVERNMENT AGENCY NOTES – (2.16%)
		Fannie Mae, 4.00%, 01/28/13			$	400,000	$	426,408
		Federal Home Loan Bank, 5.30%, 06/15/12				739,804		772,150
		Federal Home Loan Bank, 2.60%, 04/20/15				2,344,136		2,346,945
			TOTAL GOVERNMENT AGENCY NOTES – (Identified cost $3,506,454)					3,545,503
MORTGAGES – (95.00%)
	COLLATERALIZED MORTGAGE OBLIGATIONS – (64.91%)
		Fannie Mae, 4.50%, 01/25/14				278,016		289,125
		Fannie Mae, 3.50%, 09/25/16				391,940		398,861
		Fannie Mae, 5.00%, 02/25/17				472,215		478,888
		Fannie Mae, 5.00%, 12/25/17				1,020,207		1,026,085
		Fannie Mae, 4.00%, 01/25/19				1,265,000		1,325,213
		Fannie Mae, 4.00%, 04/25/19				5,000,000		5,283,947
		Fannie Mae, 2.00%, 06/25/19				3,915,457		3,932,562
		Fannie Mae, 4.50%, 07/25/21				328,406		331,834
		Fannie Mae, 4.00%, 07/25/23				3,323,411		3,481,519
		Fannie Mae, 4.00%, 11/25/23				2,512,419		2,631,351
		Fannie Mae, 8.00%, 12/17/24				29,961		29,968
		Fannie Mae, 5.50%, 03/25/28				196,473		198,259
		Fannie Mae, 5.00%, 02/25/35				502,219		530,263
		Fannie Mae, 0.5106%, 03/25/37 (a)				2,196,639		2,188,376
		Fannie Mae, 0.7606%, 06/25/38 (a)				1,162,761		1,167,323
		Freddie Mac, 4.00%, 10/15/15				542,397		544,470
		Freddie Mac, 4.50%, 05/15/16				351,067		354,904
		Freddie Mac, 4.00%, 09/15/16				1,172,382		1,196,123
		Freddie Mac, 4.00%, 01/15/17				586,231		604,686
		Freddie Mac, 3.50%, 01/15/18				470,050		487,459
		Freddie Mac, 5.00%, 01/15/18				663,065		677,165
		Freddie Mac, 4.00%, 06/15/18				1,952,626		1,998,331
		Freddie Mac, 4.50%, 07/15/18				1,887,383		1,993,885
		Freddie Mac, 4.00%, 09/15/18				5,000,000		5,336,772
		Freddie Mac, 4.00%, 10/15/18				975,000		1,041,991
		Freddie Mac, 2.00%, 11/15/18				2,325,191		2,340,282
		Freddie Mac, 5.00%, 05/15/19				329,188		338,996
		Freddie Mac, 2.25%, 06/15/20				1,748,337		1,760,156
		Freddie Mac, 2.25%, 12/15/20				1,956,890		1,963,956
		Freddie Mac, 2.50%, 12/15/20				3,000,000		3,024,999
		Freddie Mac, 5.00%, 12/15/22				1,155,875		1,173,672
		Freddie Mac, 4.50%, 09/15/23				3,458,331		3,646,809
		Freddie Mac, 1.3625%, 03/15/24 (a)				3,790,959		3,846,186
		Freddie Mac, 3.50%, 07/15/24				3,962,994		4,082,220
		Freddie Mac, 5.00%, 06/15/25				22,550		22,633
		Freddie Mac, 5.00%, 05/15/27				228,543		231,766
		Freddie Mac, 4.00%, 01/15/28				4,953,990		5,110,547
		Freddie Mac, 5.00%, 09/15/28				1,949,128		1,983,738
		Freddie Mac, 4.50%, 06/15/29				3,306,998		3,413,657

DAVIS SERIES, INC.	Schedule of Investments
DAVIS GOVERNMENT BOND FUND - (CONTINUED)	December 31, 2010

				Principal			Value (Note 1)
MORTGAGES – (CONTINUED)
	COLLATERALIZED MORTGAGE OBLIGATIONS – (CONTINUED)
		Freddie Mac, 6.00%, 03/15/30			$	65,514	$	66,397
		Freddie Mac, 4.50%, 08/15/32				5,000,000		5,363,036
		Freddie Mac, 4.25%, 06/15/33				634,757		651,595
		Freddie Mac, 4.50%, 08/15/36				3,346,753		3,454,927
		Freddie Mac, 0.6603%, 11/15/37 (a)				3,968,972		3,975,117
		Freddie Mac Reference REMIC, 5.125%, 06/15/18				2,967,643		3,070,053
		Ginnie Mae, 4.50%, 10/20/20				1,505,851		1,544,949
		Ginnie Mae, 4.00%, 11/20/30				3,571,336		3,746,590
		Ginnie Mae, 5.00%, 02/16/32				3,143,213		3,294,640
		Ginnie Mae, 5.00%, 08/20/32				1,355,501		1,372,850
		Ginnie Mae, 4.00%, 05/20/33				4,948,142		5,257,358
		Ginnie Mae, 6.1478%, 04/20/37 (a)				3,870,815		4,270,942
			Total Collateralized Mortgage Obligations					106,537,431
	FANNIE MAE POOLS – (22.42%)
		3.50%, 04/01/11, Pool No. 255245				726,681		728,917
		4.562%, 01/01/15, Pool No. 725788				1,138,046		1,213,443
		5.055%, 11/01/15, Pool No. 387686				4,688,451		5,091,792
		6.00%, 09/01/17, Pool No. 665776				1,806,942		1,971,600
		5.00%, 03/01/18, Pool No. 357369				867,208		929,051
		4.50%, 08/01/18, Pool No. 254833				1,538,449		1,639,476
		4.00%, 01/01/19, Pool No. 976841				1,138,680		1,192,554
		3.50%, 09/01/20, Pool No. MA0521				2,815,737		2,882,083
		3.00%, 12/01/20, Pool No. MA0605				4,960,428		5,037,878
		4.00%, 07/01/25, Pool No. AD7151				3,249,914		3,350,864
		6.50%, 07/01/32, Pool No. 635069				129,170		146,177
		2.061%, 10/01/32, Pool No. 648917 (b)				1,159,286		1,192,337
		4.836%, 05/01/35, Pool No. 826242 (b)				658,885		691,573
		4.92%, 01/01/36, Pool No. 848973 (b)				769,434		812,753
		2.285%, 03/01/36, Pool No. 843396 (b)				265,598		270,380
		5.619%, 04/01/36, Pool No. 851605 (b)				804,465		860,282
		6.50%, 09/01/37, Pool No. AA0924				2,460,025		2,713,746
		4.374%, 03/01/39, Pool No. AE0362 (b)				3,616,829		3,793,890
		3.059%, 01/01/40, Pool No. AD0881 (b)				2,154,311		2,285,293
			Total Fannie Mae Pools					36,804,089
	FREDDIE MAC POOLS – (7.09%)
		4.00%, 02/01/11, Pool No. M80897				367,760		368,886
		4.00%, 03/01/11, Pool No. M80903				840,228		842,801
		5.00%, 03/01/12, Pool No. M80963				423,961		432,097
		3.50%, 04/01/12, Pool No. M80974				644,237		650,416
		5.00%, 05/01/12, Pool No. M80971				712,850		729,356
		4.00%, 12/01/12, Pool No. M81008				513,141		526,894
		4.50%, 03/01/15, Pool No. B18794				512,215		536,311
		5.50%, 12/01/18, Pool No. G11684				1,108,331		1,197,690
		5.00%, 05/01/21, Pool No. G13296				1,440,799		1,534,992
		5.00%, 09/01/21, Pool No. G12673				1,252,872		1,334,778
		5.50%, 06/01/22, Pool No. G12688				758,965		816,599
		2.771%, 12/01/34, Pool No. 1H1238 (b)				412,110		431,202

DAVIS SERIES, INC.	Schedule of Investments
DAVIS GOVERNMENT BOND FUND - (CONTINUED)	December 31, 2010

					Principal			Value (Note 1)
MORTGAGES – (CONTINUED)
	FREDDIE MAC POOLS – (CONTINUED)
		4.772%, 04/01/35, Pool No. 782528 (b)				$	2,101,393	$	2,233,101
				Total Freddie Mac Pools					11,635,123
	GINNIE MAE POOLS – (0.58%)
		6.50%, 09/15/13, Pool No. 780856					888,343		945,807
				Total Ginnie Mae Pools					945,807

			TOTAL MORTGAGES – (Identified cost $154,717,934)						155,922,450

OTHER AGENCIES – (0.19%)
		Housing Urban Development, 6.00%, 08/01/20					300,000		318,669

			TOTAL OTHER AGENCIES – (Identified cost $318,556)						318,669

SHORT-TERM INVESTMENTS – (2.74%)
		Banc of America Securities LLC Joint Repurchase Agreement, 0.25%, 01/03/11, dated 12/31/10, repurchase value of $863,018 (collateralized by: U.S. Government agency mortgages in a pooled cash account, 2.104%-6.50%, 06/01/25-12/01/40, total market value $880,260)					863,000		863,000
		Goldman, Sachs & Co. Joint Repurchase Agreement, 0.16%, 01/03/11, dated 12/31/10, repurchase value of $1,036,014 (collateralized by: U.S. Government agency mortgages in a pooled cash account, 3.50%-6.50%, 12/01/25-01/01/41, total market value $1,056,720)					1,036,000		1,036,000
		Mizuho Securities USA Inc. Joint Repurchase Agreement, 0.24%, 01/03/11, dated 12/31/10, repurchase value of $2,589,052 (collateralized by: U.S. Government agency obligations in a pooled cash account, 3.125%-7.50%, 01/31/12-05/15/37, total market value $2,640,780)					2,589,000		2,589,000

			TOTAL SHORT-TERM INVESTMENTS – (Identified cost $4,488,000)						4,488,000


Total Investments – (100.09%) – (Identified cost $163,030,944) – (c)									164,274,622
Liabilities Less Other Assets – (0.09%)									(147,817)
Net Assets – (100.00%)								$	164,126,805

(a)

The interest rates on floating rate securities, shown as of December 31, 2010, may change daily or less frequently and are based on indices of market interest rates. For purposes of amortized cost valuation, the maturity dates of these securities are considered to be the effective maturities, based on the reset dates of the securities' variable rates.

(b)

The interest rates on adjustable rate securities, shown as of December 31, 2010, may change daily or less frequently and are based on indices of market interest rates.

(c)

Aggregate cost for federal income tax purposes is $163,030,944. At December 31, 2010 unrealized appreciation (depreciation) of securities for federal income tax purposes is as follows:

	Unrealized appreciation	$	2,002,830
	Unrealized depreciation		(759,152)
Net unrealized appreciation		$	1,243,678


See Notes to Financial Statements

DAVIS SERIES, INC.	Schedule of Investments
DAVIS GOVERNMENT MONEY MARKET FUND	December 31, 2010

			Principal			Value (Note 1)
FANNIE MAE – (2.95%)
	0.30%, 01/03/11 (a)			$	342,000	$	341,994
	1.375%, 04/28/11				1,556,000		1,561,673
	6.00%, 05/15/11				158,000		161,287
	3.375%, 05/19/11				5,842,000		5,912,139
	0.265%, 06/02/11 (a)				1,500,000		1,498,322

		TOTAL FANNIE MAE – (Identified cost $9,475,415)					9,475,415

FEDERAL FARM CREDIT BANK – (2.04%)
	5.81%, 01/10/11				434,000		434,580
	1.60%, 01/12/11				450,000		450,172
	4.875%, 02/18/11				315,000		316,856
	3.00%, 03/03/11				110,000		110,494
	4.77%, 05/25/11				200,000		203,580
	5.05%, 05/25/11				125,000		127,326
	4.25%, 07/11/11				300,000		306,122
	0.30%, 11/08/11				4,600,000		4,599,608

		TOTAL FEDERAL FARM CREDIT BANK – (Identified cost $6,548,738)					6,548,738

FEDERAL HOME LOAN BANK – (27.28%)
	0.40%, 01/04/11				900,000		900,007
	0.75%, 01/18/11				100,000		100,020
	1.625%, 01/21/11				470,000		470,314
	5.07%, 01/27/11				150,000		150,495
	2.875%, 03/11/11				675,000		678,403
	4.875%, 03/11/11				4,000,000		4,035,648
	5.00%, 03/11/11				275,000		277,402
	1.625%, 03/16/11				550,000		551,386
	0.75%, 03/25/11				1,850,000		1,851,917
	0.70%, 04/18/11				750,000		750,985
	0.24%, 05/06/11 (b)				12,000,000		11,999,007
	7.03%, 05/06/11				290,000		296,759
	0.19%, 05/12/11				5,000,000		4,999,451
	1.375%, 05/16/11				3,585,000		3,600,542
	0.50%, 05/17/11				750,000		750,668
	0.54%, 05/24/11				535,000		535,630
	0.23%, 05/27/11 (b)				4,500,000		4,500,000
	0.305%, 05/27/11 (b)				4,500,000		4,500,000
	0.70%, 05/27/11				215,000		215,254
	3.125%, 06/10/11				7,075,000		7,165,054
	5.25%, 06/10/11				735,000		751,137
	0.37%, 06/15/11 (b)				6,755,000		6,756,346
	3.375%, 06/24/11				2,545,000		2,583,518
	1.625%, 07/27/11				5,000,000		5,039,682
	5.375%, 08/19/11				300,000		309,281
	0.40%, 11/18/11				9,250,000		9,250,000
	0.345%, 11/28/11 (b)				4,600,000		4,604,874
	0.40%, 12/09/11				4,600,000		4,599,367

DAVIS SERIES, INC.	Schedule of Investments
DAVIS GOVERNMENT MONEY MARKET FUND - (CONTINUED)	December 31, 2010

				Principal			Value (Note 1)
FEDERAL HOME LOAN BANK – (CONTINUED)
	0.40%, 12/20/11				$	5,250,000	$	5,250,000

			TOTAL FEDERAL HOME LOAN BANK – (Identified cost $87,473,147)					87,473,147

FREDDIE MAC – (10.89%)
	0.26%, 01/03/11 (a)					9,250,000		9,249,866
	4.75%, 01/18/11					450,000		450,923
	0.3369%, 01/28/11 (b)					1,500,000		1,500,143
	3.30%, 02/15/11					255,000		255,926
	0.3722%, 03/09/11 (b)					500,000		500,237
	5.875%, 03/21/11					469,000		474,520
	0.35%, 04/01/11 (b)					4,500,000		4,502,531
	2.75%, 04/11/11					3,915,000		3,942,358
	3.50%, 05/05/11					1,000,000		1,010,151
	0.255%, 06/20/11 (a)					640,000		639,229
	3.875%, 06/29/11					120,000		122,103
	5.25%, 07/18/11					5,150,000		5,290,727
	0.2206%, 09/19/11 (b)					7,000,000		6,997,975

			TOTAL FREDDIE MAC – (Identified cost $34,936,689)					34,936,689

OTHER AGENCIES – (0.19%)
	RFCO Strip, 0.5053%, 07/15/11 (a)					600,000		598,383

			TOTAL OTHER AGENCIES – (Identified cost $598,383)					598,383

REPURCHASE AGREEMENTS – (49.58%)
	Banc of America Securities LLC Joint Repurchase Agreement, 0.25%, 01/03/11, dated 12/31/10, repurchase value of $30,574,637 (collateralized by: U.S. Government agency mortgages in a pooled cash account, 2.104%-6.50%, 06/01/25-12/01/40, total market value $31,185,480)					30,574,000		30,574,000
	Goldman, Sachs & Co. Joint Repurchase Agreement, 0.16%, 01/03/11, dated 12/31/10, repurchase value of $36,688,489 (collateralized by: U.S. Government agency mortgages in a pooled cash account, 3.50%-6.50%, 12/01/25-01/01/41, total market value $37,421,760)					36,688,000		36,688,000
	Mizuho Securities USA Inc. Joint Repurchase Agreement, 0.24%, 01/03/11, dated 12/31/10, repurchase value of $91,723,834 (collateralized by: U.S. Government agency obligations in a pooled cash account, 3.125%-7.50%, 01/31/12-05/15/37, total market value $93,556,440)					91,722,000		91,722,000

			TOTAL REPURCHASE AGREEMENTS – (Identified cost $158,984,000)					158,984,000

		Total Investments – (92.93%) – (Identified cost $298,016,372) – (c)						298,016,372
		Other Assets Less Liabilities – (7.07%)						22,670,725
Net Assets – (100.00%)							$	320,687,097

(a)

Zero coupon bonds reflect the effective yield on the date of purchase.

DAVIS SERIES, INC.	Schedule of Investments
DAVIS GOVERNMENT MONEY MARKET FUND - (CONTINUED)	December 31, 2010

(b)		The interest rates on floating rate securities, shown as of December 31, 2010, may change daily or less frequently and are based on indices of market interest rates. For purposes of amortized cost valuation, the maturity dates of these securities are considered to be the effective maturities, based on the reset dates of the securities' variable rates.

(c)		Aggregate cost for federal income tax purposes is $298,016,372.

See Notes to Financial Statements

DAVIS SERIES, INC.	Schedule of Investments
DAVIS FINANCIAL FUND	December 31, 2010

						Shares		Value (Note 1)
COMMON STOCK – (99.77%)
	ENERGY – (6.73%)
				Canadian Natural Resources Ltd. (Canada)			895,890	$	39,795,434
					Total Energy				39,795,434
	FINANCIALS – (90.50%)
		Banks – (17.67%)
			Commercial Banks – (17.67%)
				Banco Santander Brasil S.A., ADS (Brazil)			139,900		1,902,640
				ICICI Bank Ltd., ADR (India)			132,597		6,714,712
				SKBHC Holdings LLC *(a)			878		2,853,406
				State Bank of India Ltd., GDR (India)			354,949		45,965,895
				U.S. Bancorp			101,671		2,742,067
				Wells Fargo & Co.			1,427,319		44,232,616
									104,411,336

		Diversified Financials – (40.96%)
			Capital Markets – (21.77%)
				Ameriprise Financial, Inc.			140,254		8,071,617
				Bank of New York Mellon Corp.			1,030,874		31,132,395
				Brookfield Asset Management Inc., Class A (Canada)			697,390		23,216,113
				Charles Schwab Corp.			125,998		2,155,826
				GAM Holding Ltd. (Switzerland)*			449,068		7,420,428
				Goldman Sachs Group, Inc.			138,492		23,288,815
				Julius Baer Group Ltd. (Switzerland)			655,068		30,686,608
				T. Rowe Price Group Inc.			41,530		2,679,931
									128,651,733

			Consumer Finance – (8.37%)
				American Express Co. (b)			1,086,982		46,653,268
				First Marblehead Corp. *			1,305,032		2,831,919
									49,485,187

			Diversified Financial Services – (10.82%)
				Bank of America Corp.			121,264		1,617,662
				Cielo S.A. (Brazil)			492,300		3,988,816
				Moody's Corp.			335,380		8,900,985
				Oaktree Capital Group LLC, Class A (a)			972,000		34,506,000
				RHJ International (Belgium)*			47,264		391,585
				RHJ International, 144A (Belgium)*(a)(c)			396,550		3,298,345
				Visa Inc., Class A			160,137		11,270,442
									63,973,835
									242,110,755

DAVIS SERIES, INC.	Schedule of Investments
DAVIS FINANCIAL FUND - (CONTINUED)	December 31, 2010

								Shares/Principal			Value (Note 1)
COMMON STOCK – (CONTINUED)
	FINANCIALS – (CONTINUED)
		Insurance – (31.87%)
			Life & Health Insurance – (2.77%)
				China Life Insurance Co., Ltd., ADR (China)						268,127	$	16,401,329
			Multi-line Insurance – (8.24%)
				Loews Corp. (b)						1,251,245		48,685,943
			Property & Casualty Insurance – (9.32%)
				ACE Ltd.						111,996		6,971,751
				Markel Corp. *						69,686		26,350,367
				Progressive Corp. (Ohio)						1,094,565		21,749,007
												55,071,125

			Reinsurance – (11.54%)
				Everest Re Group, Ltd.						197,972		16,791,985
				Transatlantic Holdings, Inc.						996,096		51,418,475
												68,210,460
												188,368,857
							Total Financials					534,890,948
	INDUSTRIALS – (2.54%)
		Commercial & Professional Services – (2.54%)
				D&B Corp.						182,602		14,989,798
							Total Industrials					14,989,798

						TOTAL COMMON STOCK – (Identified cost $381,623,122)						589,676,180

SHORT-TERM INVESTMENTS – (0.04%)
				Banc of America Securities LLC Joint Repurchase Agreement, 0.25%, 01/03/11, dated 12/31/10, repurchase value of $41,001 (collateralized by: U.S. Government agency mortgages in a pooled cash account, 2.104%-6.50%, 06/01/25-12/01/40, total market value $41,820)					$	41,000		41,000
				Goldman, Sachs & Co. Joint Repurchase Agreement, 0.16%, 01/03/11, dated 12/31/10, repurchase value of $48,001 (collateralized by: U.S. Government agency mortgages in a pooled cash account, 3.50%-6.50%, 12/01/25-01/01/41, total market value $48,960)						48,000		48,000
				Mizuho Securities USA Inc. Joint Repurchase Agreement, 0.24%, 01/03/11, dated 12/31/10, repurchase value of $121,002 (collateralized by: U.S. Government agency obligations in a pooled cash account, 3.125%-7.50%, 01/31/12-05/15/37, total market value $123,420)						121,000		121,000

						TOTAL SHORT-TERM INVESTMENTS – (Identified cost $210,000)						210,000


					Total Investments – (99.81%) – (Identified cost $381,833,122) – (d)							589,886,180
					Other Assets Less Liabilities – (0.19%)							1,117,747
Net Assets – (100.00%)											$	591,003,927

DAVIS SERIES, INC.	Schedule of Investments
DAVIS FINANCIAL FUND - (CONTINUED)	December 31, 2010

	ADR: American Depositary Receipt

	ADS: American Depositary Share

	GDR: Global Depositary Receipt

	*	Non-Income producing security.

	(a)	Restricted Security – See Note 8 of the Notes to Financial Statements.

	(b)	A portion of these securities is pledged to cover unfunded capital commitments at December 31, 2010.

	(c)	This security is subject to Rule 144A. The Board of Directors of the Fund has determined that there is sufficient liquidity in this security to realize current valuations. This security amounted to $3,298,345 or 0.56% of the Fund's net assets as of December 31, 2010.

	(d)	Aggregate cost for federal income tax purposes is $386,422,023. At December 31, 2010 unrealized appreciation (depreciation) of securities for federal income tax purposes is as follows:

			Unrealized appreciation		$	244,088,090
			Unrealized depreciation			(40,623,933)
				Net unrealized appreciation	$	203,464,157


See Notes to Financial Statements

DAVIS SERIES, INC.	Schedule of Investments
DAVIS APPRECIATION & INCOME FUND	December 31, 2010

						Shares		Value (Note 1)
COMMON STOCK – (51.39%)
	CONSUMER DISCRETIONARY – (7.64%)
		Consumer Durables & Apparel – (0.27%)
				Toll Brothers, Inc. *			65,400	$	1,242,600
		Media – (2.00%)
				News Corp., Class A			621,300		9,049,235
		Retailing – (5.37%)
				Amazon.com, Inc. *			28,713		5,166,617
				Kohl's Corp. *			351,800		19,116,812
									24,283,429
					Total Consumer Discretionary				34,575,264
	CONSUMER STAPLES – (7.00%)
		Food & Staples Retailing – (2.99%)
				Whole Foods Market, Inc. *			268,000		13,550,080
		Food, Beverage & Tobacco – (1.89%)
				Tyson Foods, Inc., Class A			495,700		8,535,954
		Household & Personal Products – (2.12%)
				Avon Products, Inc.			329,300		9,569,458
					Total Consumer Staples				31,655,492
	ENERGY – (8.50%)
				Devon Energy Corp.			208,100		16,337,931
				Nabors Industries Ltd. *			494,900		11,610,354
				Transocean Ltd. *			151,431		10,525,969
					Total Energy				38,474,254
	FINANCIALS – (4.66%)
		Diversified Financials – (4.66%)
			Consumer Finance – (2.13%)
				American Express Co.			224,000		9,614,080
			Diversified Financial Services – (2.53%)
				Bank of America Corp.			733,876		9,789,906
				Citigroup Inc. *			351,860		1,664,297
									11,454,203
									21,068,283
					Total Financials				21,068,283
	HEALTH CARE – (2.63%)
		Health Care Equipment & Services – (2.63%)
				Universal Health Services, Inc., Class B			274,500		11,918,790
					Total Health Care				11,918,790
	INDUSTRIALS – (10.93%)
		Capital Goods – (6.75%)
				General Electric Co.			465,200		8,508,508
				Masco Corp.			529,500		6,703,470
				Quanta Services, Inc. *			770,790		15,354,137
									30,566,115

		Commercial & Professional Services – (4.18%)
				ADFITECH, Inc. *			266,000		711,550
				School Specialty, Inc. *			503,863		7,023,850
				Waste Connections, Inc.			405,750		11,170,297
									18,905,697
					Total Industrials				49,471,812

DAVIS SERIES, INC.	Schedule of Investments
DAVIS APPRECIATION & INCOME FUND - (CONTINUED)	December 31, 2010

							Shares/Principal			Value (Note 1)
COMMON STOCK – (CONTINUED)
	INFORMATION TECHNOLOGY – (3.96%)
		Semiconductors & Semiconductor Equipment – (3.96%)
				Fairchild Semiconductor International, Inc. *					516,897	$	8,068,762
				Intel Corp.					77,300		1,626,392
				International Rectifier Corp. *					277,100		8,227,099
											17,922,253
						Total Information Technology					17,922,253
	MATERIALS – (4.58%)
				Freeport-McMoRan Copper & Gold Inc.					104,241		12,518,302
				Sealed Air Corp.					323,000		8,220,350
						Total Materials					20,738,652
	UTILITIES – (1.49%)
				AES Corp. *					551,700		6,719,706
						Total Utilities					6,719,706

					TOTAL COMMON STOCK – (Identified cost $226,017,274)						232,544,506

PREFERRED STOCK – (12.03%)
	CONSUMER DISCRETIONARY – (0.24%)
		Automobiles & Components – (0.24%)
				General Motors Co., 4.75%, Series B, Conv. Pfd.					20,000		1,081,700
						Total Consumer Discretionary					1,081,700
	FINANCIALS – (6.54%)
		Diversified Financials – (4.49%)
			Diversified Financial Services – (4.49%)
				Citigroup Capital XII, 8.50%, TRUPS					113,800		3,013,708
				Citigroup Inc., 7.50%, Conv. Pfd., T-DECS					127,200		17,308,104
											20,321,812

		Real Estate – (2.05%)
				Alexandria Real Estate Equities, Inc., 7.00%, Series D, Conv. Pfd.					374,010		9,256,748
						Total Financials					29,578,560
	INDUSTRIALS – (2.27%)
		Capital Goods – (0.99%)
				United Rentals Trust I, 6.50%, Conv. Pfd.					104,241		4,488,878
		Transportation – (1.28%)
				Continental Airlines Finance Trust II, 6.00%, Cum. Conv. Pfd.					153,200		5,783,300
						Total Industrials					10,272,178
	UTILITIES – (2.98%)
				AES Trust III, 6.75%, Conv. Pfd.					274,410		13,514,693
						Total Utilities					13,514,693

					TOTAL PREFERRED STOCK – (Identified cost $40,834,194)						54,447,131

CONVERTIBLE BONDS – (32.06%)
	CONSUMER DISCRETIONARY – (0.88%)
		Consumer Durables & Apparel – (0.88%)
				Eastman Kodak Co., Conv. Sr. Notes, 7.00%, 04/01/17				$	3,800,000		3,985,250
						Total Consumer Discretionary					3,985,250

DAVIS SERIES, INC.	Schedule of Investments
DAVIS APPRECIATION & INCOME FUND - (CONTINUED)	December 31, 2010

								Principal			Value (Note 1)
CONVERTIBLE BONDS – (CONTINUED)
	CONSUMER STAPLES – (3.62%)
			Food, Beverage & Tobacco – (3.62%)
					Tyson Foods, Inc., Conv. Sr. Notes, 3.25%, 10/15/13				$	13,300,000	$	16,375,625
							Total Consumer Staples					16,375,625
	ENERGY – (3.17%)
					Nabors Industries Inc., Conv. Sr. Notes, 0.94%, 05/15/11					2,400,000		2,397,000
					Transocean Ltd., Conv. Sr. Notes, 1.50%, 12/15/37					12,300,000		11,961,750
							Total Energy					14,358,750
	FINANCIALS – (8.66%)
		Diversified Financials – (0.07%)
				Capital Markets – (0.07%)
					Janus Capital Group Inc., Conv. Sr. Notes, 3.25%, 07/15/14					250,000		297,500
		Real Estate – (8.59%)
					Digital Realty Trust, Inc., 144A Conv. Sr. Notes, 5.50%, 04/15/29 (a)					6,650,000		8,927,625
					Forest City Enterprises, Inc., Conv. Sr. Notes, 3.625%, 10/15/14					21,850,000		27,667,562
					Forest City Enterprises, Inc., Conv. Sr. Notes, 5.00%, 10/15/16					1,600,000		2,282,000
												38,877,187
							Total Financials					39,174,687
	HEALTH CARE – (1.84%)
		Pharmaceuticals, Biotechnology & Life Sciences – (1.84%)
					Valeant Pharmaceuticals International, Conv. Sub. Notes, 4.00%, 11/15/13					3,700,000		8,306,500
							Total Health Care					8,306,500
	INDUSTRIALS – (3.61%)
		Capital Goods – (1.25%)
					United Rentals, Inc., Conv. Sr. Notes, 4.00%, 11/15/15					2,565,000		5,646,206
		Commercial & Professional Services – (2.36%)
					School Specialty, Inc., Conv. Sub. Deb., 3.75%, 11/30/26					10,900,000		10,682,000
							Total Industrials					16,328,206
	INFORMATION TECHNOLOGY – (4.02%)
		Semiconductors & Semiconductor Equipment – (4.02%)
					Intel Corp., Conv. Jr. Sub. Deb., 2.95%, 12/15/35					9,050,000		9,061,313
					Intel Corp., Conv. Jr. Sub. Deb., 3.25%, 08/01/39					7,600,000		9,148,500
												18,209,813
							Total Information Technology					18,209,813
	MATERIALS – (6.26%)
					Allegheny Technologies, Inc., Conv. Sr. Notes, 4.25%, 06/01/14					8,555,000		12,950,131
					United States Steel Corp., Conv. Sr. Notes, 4.00%, 05/15/14					7,900,000		15,365,500
							Total Materials					28,315,631

						TOTAL CONVERTIBLE BONDS – (Identified cost $117,210,406)						145,054,462

CORPORATE BONDS – (3.07%)
	CONSUMER DISCRETIONARY – (0.61%)
		Retailing – (0.61%)
					Kohl's Corp., Sr. Notes, 6.25%, 12/15/17					2,400,000		2,772,979
							Total Consumer Discretionary					2,772,979

DAVIS SERIES, INC.	Schedule of Investments
DAVIS APPRECIATION & INCOME FUND - (CONTINUED)	December 31, 2010

							Principal				Value (Note 1)
CORPORATE BONDS – (CONTINUED)
	FINANCIALS – (0.15%)
		Real Estate – (0.15%)
			Thornburg Mortgage, Inc., Sr. Notes, 8.00%, 05/15/13 (b)					$	13,300,000	$		681,625
						Total Financials						681,625
	INDUSTRIALS – (2.31%)
		Capital Goods – (2.15%)
			Masco Corp., Sr. Notes, 6.125%, 10/03/16						9,500,000			9,720,381
		Commercial & Professional Services – (0.16%)
			ADFITECH, Inc., Sr. Bond, 8.00%, 03/15/20						1,040,991			711,855
						Total Industrials						10,432,236

					TOTAL CORPORATE BONDS – (Identified cost $22,802,249)							13,886,840

SHORT-TERM INVESTMENTS – (1.44%)
			Banc of America Securities LLC Joint Repurchase Agreement, 0.25%, 01/03/11, dated 12/31/10, repurchase value of $1,253,026 (collateralized by: U.S. Government agency mortgages in a pooled cash account, 2.104%-6.50%, 06/01/25-12/01/40, total market value $1,278,060)						1,253,000			1,253,000
			Goldman, Sachs & Co. Joint Repurchase Agreement, 0.16%, 01/03/11, dated 12/31/10, repurchase value of $1,504,020 (collateralized by: U.S. Government agency mortgages in a pooled cash account, 3.50%-6.50%, 12/01/25-01/01/41, total market value $1,534,080)						1,504,000			1,504,000
			Mizuho Securities USA Inc. Joint Repurchase Agreement, 0.24%, 01/03/11, dated 12/31/10, repurchase value of $3,759,075 (collateralized by: U.S. Government agency obligations in a pooled cash account, 3.125%-7.50%, 01/31/12-05/15/37, total market value $3,834,180)						3,759,000			3,759,000

					TOTAL SHORT-TERM INVESTMENTS – (Identified cost $6,516,000)							6,516,000


				Total Investments – (99.99%) – (Identified cost $413,380,123) – (c)								452,448,939
				Other Assets Less Liabilities – (0.01%)								30,103
Net Assets – (100.00%)										$		452,479,042


	T-DECS: Tangible Dividend Enhanced Common Stock

	TRUPS: Trust Preferred Securities

Non-Income producing security.

(a)

This security is subject to Rule 144A. The Board of Directors of the Fund has determined that there is sufficient liquidity in this security to realize current valuations. This security amounted to $8,927,625 or 1.97% of the Fund's net assets as of December 31, 2010.

(b)

This security is in default. See Note 1 of the Notes to Financial Statements.

(c)

Aggregate cost for federal income tax purposes is $413,428,103. At December 31, 2010 unrealized appreciation (depreciation) of securities for federal income tax purposes is as follows:

	Unrealized appreciation	$	81,592,843
	Unrealized depreciation		(42,572,007)
Net unrealized appreciation		$	39,020,836


See Notes to Financial Statements

DAVIS SERIES, INC.	Schedule of Investments
DAVIS REAL ESTATE FUND	December 31, 2010

						Shares		Value (Note 1)
COMMON STOCK – (82.37%)
	CONSUMER DISCRETIONARY – (0.63%)
		Consumer Durables & Apparel – (0.63%)
				Homebuilding – (0.63%)
				Toll Brothers, Inc. *			100,200	$	1,903,800
					Total Consumer Discretionary				1,903,800
	FINANCIALS – (70.04%)
		Real Estate – (70.04%)
			Real Estate Investment Trusts (REITs) – (59.56%)
				Diversified REITs – (2.25%)
				Vornado Realty Trust			80,914		6,742,564
				Industrial REITs – (4.38%)
				DCT Industrial Trust Inc.			1,238,900		6,578,559
				EastGroup Properties, Inc.			155,800		6,593,456
									13,172,015

				Office REITs – (24.82%)
				Alexandria Real Estate Equities, Inc.			219,413		16,074,196
				Boston Properties, Inc.			69,400		5,975,340
				Coresite Realty Corp.			636,500		8,681,860
				Corporate Office Properties Trust			204,438		7,145,108
				Digital Realty Trust, Inc.			138,200		7,122,828
				Douglas Emmett, Inc.			501,200		8,319,920
				DuPont Fabros Technology Inc.			630,000		13,400,100
				Highwoods Properties, Inc.			247,300		7,876,505
									74,595,857

				Residential REITs – (10.66%)
				American Campus Communities, Inc.			540,200		17,156,752
				Essex Property Trust, Inc.			89,900		10,268,378
				UDR, Inc.			196,500		4,621,680
									32,046,810

				Retail REITs – (8.44%)
				Federal Realty Investment Trust			49,100		3,826,363
				Regency Centers Corp.			245,000		10,348,800
				Simon Property Group, Inc.			73,782		7,340,571
				Taubman Centers, Inc.			76,100		3,841,528
									25,357,262

				Specialized REITs – (9.01%)
				Cogdell Spencer, Inc.			822,547		4,770,773
				Entertainment Properties Trust			188,100		8,699,625
				LaSalle Hotel Properties			197,500		5,214,000
				Ventas, Inc.			159,900		8,391,552
									27,075,950
									178,990,458

			Real Estate Management & Development – (10.48%)
				Real Estate Operating Companies – (9.36%)
				Brookdale Senior Living Inc. *			258,000		5,523,780
				Forest City Enterprises, Inc., Class A *			1,355,154		22,617,520
									28,141,300

DAVIS SERIES, INC.	Schedule of Investments
DAVIS REAL ESTATE FUND - (CONTINUED)	December 31, 2010

							Shares/Principal			Value (Note 1)
COMMON STOCK – (CONTINUED)
	FINANCIALS – (CONTINUED)
		Real Estate – (Continued)
			Real Estate Management & Development – (Continued)
				Real Estate Services – (1.12%)
				CB Richard Ellis Group, Inc., Class A *					164,000	$	3,358,720
											31,500,020
											210,490,478
						Total Financials					210,490,478
	INDUSTRIALS – (2.99%)
		Transportation – (2.99%)
				Alexander & Baldwin, Inc.					224,600		8,990,738
						Total Industrials					8,990,738
	TELECOMMUNICATION SERVICES – (8.71%)
				American Tower Corp., Class A *					153,200		7,911,248
				Crown Castle International Corp. *					215,400		9,440,982
				SBA Communications Corp., Class A *					215,400		8,820,630
						Total Telecommunication Services					26,172,860

					TOTAL COMMON STOCK – (Identified cost $194,647,157)						247,557,876

PREFERRED STOCK – (9.31%)
	FINANCIALS – (9.31%)
		Real Estate – (9.31%)
			Real Estate Investment Trusts (REITs) – (9.31%)
				Industrial REITs – (1.36%)
				AMB Property Corp., 6.75%, Series M					171,000		4,098,870
				Office REITs – (7.05%)
				Alexandria Real Estate Equities, Inc., 7.00%, Series D, Conv. Pfd.					468,943		11,606,339
				Digital Realty Trust, Inc., 5.50%, Series D, Cum. Conv. Pfd.					79,500		2,531,582
				SL Green Realty Corp., 7.625%, Series C					280,910		7,040,307
											21,178,228

				Retail REITs – (0.90%)
				CBL & Associates Properties, Inc., 7.375%, Series D					114,160		2,700,170
						Total Financials					27,977,268
					TOTAL PREFERRED STOCK – (Identified cost $13,258,650)						27,977,268
CONVERTIBLE BONDS – (3.05%)
	FINANCIALS – (3.05%)
		Real Estate – (3.05%)
			Real Estate Investment Trusts (REITs) – (2.55%)
				Office REITs – (2.55%)
				Digital Realty Trust, Inc., 144A Conv. Sr. Notes, 5.50%, 04/15/29 (a)				$	4,815,000		6,464,137
				SL Green Realty Corp., 144A Conv. Sr. Notes, 3.00%, 03/30/27 (a)					1,230,000		1,208,475
											7,672,612

DAVIS SERIES, INC.	Schedule of Investments
DAVIS REAL ESTATE FUND - (CONTINUED)	December 31, 2010

								Principal			Value (Note 1)
CONVERTIBLE BONDS – (CONTINUED)
	FINANCIALS – (CONTINUED)
		Real Estate – (Continued)
			Real Estate Management & Development – (0.50%)
				Real Estate Operating Companies – (0.50%)
				Forest City Enterprises, Inc., Conv. Sr. Notes, 5.00%, 10/15/16					$	1,040,000	$	1,483,300
							Total Financials					9,155,912

						TOTAL CONVERTIBLE BONDS – (Identified cost $7,067,898)						9,155,912

SHORT-TERM INVESTMENTS – (5.04%)
				Banc of America Securities LLC Joint Repurchase Agreement, 0.25%, 01/03/11, dated 12/31/10, repurchase value of $2,916,061 (collateralized by: U.S. Government agency mortgages in a pooled cash account, 2.104%-6.50%, 06/01/25-12/01/40, total market value $2,974,320)						2,916,000		2,916,000
				Goldman, Sachs & Co. Joint Repurchase Agreement, 0.16%, 01/03/11, dated 12/31/10, repurchase value of $3,500,047 (collateralized by: U.S. Government agency mortgages in a pooled cash account, 3.50%-6.50%, 12/01/25-01/01/41, total market value $3,570,000)						3,500,000		3,500,000
				Mizuho Securities USA Inc. Joint Repurchase Agreement, 0.24%, 01/03/11, dated 12/31/10, repurchase value of $8,749,175 (collateralized by: U.S. Government agency obligations in a pooled cash account, 3.125%-7.50%, 01/31/12-05/15/37, total market value $8,923,980)						8,749,000		8,749,000

						TOTAL SHORT-TERM INVESTMENTS – (Identified cost $15,165,000)						15,165,000


					Total Investments – (99.77%) – (Identified cost $230,138,705) – (b)							299,856,056
					Other Assets Less Liabilities – (0.23%)							693,023
Net Assets – (100.00%)											$	300,549,079

Non-Income producing security.

(a)

These securities are subject to Rule 144A. The Board of Directors of the Fund has determined that there is sufficient liquidity in these securities to realize current valuations. These securities amounted to $7,672,612 or 2.55% of the Fund's net assets as of December 31, 2010.

(b)

Aggregate cost for federal income tax purposes is $243,104,655. At December 31, 2010 unrealized appreciation (depreciation) of securities for federal income tax purposes is as follows:

	Unrealized appreciation	$	66,632,503
	Unrealized depreciation		(9,881,102)
Net unrealized appreciation		$	56,751,401


See Notes to Financial Statements

DAVIS SERIES, INC.	Statements of Assets and Liabilities
	At December 31, 2010

			Davis Opportunity Fund		Davis Government Bond Fund		Davis Government Money Market Fund		Davis Financial Fund		Davis Appreciation & Income Fund		Davis Real Estate Fund
ASSETS:
Investments in securities at value* (see accompanying Schedules of Investments):
	Unaffiliated companies		$	615,814,494	$	164,274,622	$	298,016,372	$	589,886,180	$	452,448,939	$	299,856,056
	Affiliated companies			258,660		–		–		–		–		–
Cash				4,841		4,293		14,038		16,869		4,273		21,091
Receivables:
	Capital stock sold			4,949,955		200,652		37,983,073		2,242,191		1,018,067		876,486
	Dividends and interest			835,877		518,690		411,979		286,392		1,067,978		1,433,579
	Investment securities sold			122,929		–		–		2,000,271		–		–
Prepaid expenses				6,787		2,110		4,822		7,803		5,035		4,820
Due from Adviser				–		–		28,000		–		–		–
		Total assets		621,993,543		165,000,367		336,458,284		594,439,706		454,544,292		302,192,032

LIABILITIES:
Payables:
	Capital stock redeemed			2,730,188		601,952		15,493,471		2,610,194		1,478,209		1,212,869
	Distributions payable			–		59,117		–		–		–		–
	Investment securities purchased			2,167,084		–		–		–		–		–
Accrued distribution and service plan fees				269,282		80,097		–		238,323		215,531		121,925
Accrued management fees				280,298		43,885		146,931		282,461		213,410		143,275
Accrued transfer agent fees				189,967		34,935		32,327		199,978		89,567		136,162
Other accrued expenses				94,136		53,576		98,458		104,823		68,533		28,722
		Total liabilities		5,730,955		873,562		15,771,187		3,435,779		2,065,250		1,642,953

NET ASSETS			$	616,262,588	$	164,126,805	$	320,687,097	$	591,003,927	$	452,479,042	$	300,549,079

NET ASSETS CONSIST OF:
Par value of shares of capital stock			$	277,817	$	292,239	$	3,206,871	$	189,449	$	160,998	$	128,476

Additional paid-in capital				644,493,047		168,020,263		317,480,226		404,095,640		534,321,148		403,402,572

Undistributed net investment income				768,483		–		–		4,165,218		43,760		1,543,538

Accumulated net realized losses from investments				(152,816,120)		(5,429,375)		–		(25,522,743)		(121,115,680)		(174,238,056)

Net unrealized appreciation on investments and foreign currency transactions				123,539,361		1,243,678		–		208,076,363		39,068,816		69,712,549
		Net Assets	$	616,262,588	$	164,126,805	$	320,687,097	$	591,003,927	$	452,479,042	$	300,549,079

*Including:
	Cost of unaffiliated companies		$	484,863,495	$	163,030,944	$	298,016,372	$	381,833,122	$	413,380,123	$	230,138,705
	Cost of affiliated companies			7,709,292		–		–		–		–		–

	Cost and market value of repurchase agreements (if greater than 10% of net assets)			–		–		158,984,000		–		–		–

DAVIS SERIES, INC.	Statements of Assets and Liabilities – (Continued)
	At December 31, 2010

		Davis Opportunity Fund		Davis Government Bond Fund		Davis Government Money Market Fund		Davis Financial Fund		Davis Appreciation & Income Fund		Davis Real Estate Fund
CLASS A SHARES:
	Net assets	$	296,879,730	$	112,117,552	$	289,024,502	$	487,948,113	$	317,323,735	$	246,372,477
	Shares outstanding		13,150,944		19,962,506		289,024,502		15,362,070		11,298,956		10,537,723
	Net asset value and redemption price per share (Net assets ÷ Shares outstanding)	$	22.57	$	5.62	$	1.00	$	31.76	$	28.08	$	23.38
	Maximum offering price per share (100/95.25 of net asset value)†	$	23.70	$	5.90	$	NA	$	33.34	$	29.48	$	24.55

CLASS B SHARES:
	Net assets	$	19,593,151	$	14,021,125	$	17,667,354	$	11,103,316	$	18,850,490	$	5,645,437
	Shares outstanding		1,013,273		2,503,800		17,667,354		407,141		678,611		244,578
	Net asset value, offering, and redemption price per share (Net assets ÷ Shares outstanding)	$	19.34	$	5.60	$	1.00	$	27.27	$	27.78	$	23.08

CLASS C SHARES:
	Net assets	$	116,235,399	$	34,572,153	$	11,867,808	$	70,963,959	$	85,427,229	$	30,033,574
	Shares outstanding		5,713,683		6,153,855		11,867,808		2,529,470		3,027,515		1,284,383
	Net asset value, offering, and redemption price per share (Net assets ÷ Shares outstanding)	$	20.34	$	5.62	$	1.00	$	28.05	$	28.22	$	23.38

CLASS Y SHARES:
	Net assets	$	183,554,308	$	3,415,975	$	2,127,433	$	20,988,539	$	30,877,588	$	18,497,591
	Shares outstanding		7,903,796		603,753		2,127,433		646,218		1,094,713		780,947
	Net asset value, offering, and redemption price per share (Net assets ÷ Shares outstanding)	$	23.22	$	5.66	$	1.00	$	32.48	$	28.21	$	23.69

†On purchases of $100,000 or more, the offering price is reduced.

See Notes to Financial Statements

DAVIS SERIES, INC.	Statements of Operations
	For the year ended December 31, 2010

		Davis Opportunity Fund		Davis Government Bond Fund		Davis Government Money Market Fund		Davis Financial Fund		Davis Appreciation & Income Fund		Davis Real Estate Fund
INVESTMENT INCOME:
Income:
Dividends*		$	11,744,900	$	–	$	–	$	10,380,378	$	5,031,055	$	6,905,053
Interest			251,873		4,358,434		768,094		1,584		5,465,478		442,817
	Total income		11,996,773		4,358,434		768,094		10,381,962		10,496,533		7,347,870

Expenses:
Management fees (Note 3)			2,953,791		474,947		1,621,348		3,287,055		2,294,883		1,636,587
Custodian fees			96,470		49,465		50,331		101,872		66,681		58,037
Transfer agent fees:
	Class A		515,206		114,071		163,562		704,598		324,648		543,044
	Class B		72,363		35,975		11,357		55,455		41,653		34,058
	Class C		237,911		58,038		8,359		155,127		107,016		75,702
	Class Y		120,391		5,877		740		44,869		32,951		19,652
Audit fees			21,600		18,000		21,600		33,600		22,800		30,000
Legal fees			13,389		3,990		8,100		15,400		13,350		7,391
Accounting fees (Note 3)			7,500		3,000		5,502		8,748		6,504		4,500
Reports to shareholders			134,248		36,924		40,989		155,000		92,490		133,057
Directors’ fees and expenses			68,757		23,015		44,251		75,005		53,886		39,806
Registration and filing fees			73,003		40,001		55,414		86,000		64,124		51,162
Interest expense			–		–		–		11,279		–		–
Excise tax expense (Note 1)			41,926		–		2,480		–		–		–
Miscellaneous			17,281		8,353		10,672		19,062		17,439		14,726
Payments under distribution plan (Note 7):
	Class A		681,594		215,872		–		878,088		556,974		533,249
	Class B		206,811		156,458		–		124,037		187,123		62,316
	Class C		1,172,447		391,528		–		701,212		840,476		298,284
Total expenses			6,434,688		1,635,514		2,044,705		6,456,407		4,722,998		3,541,571
Expenses paid indirectly (Note 4)			(378)		(3)		(39)		(18)		(76)		(3)

Reimbursement/waiver of expenses by Adviser (Note 3)			–		–		(1,358,706)		–		–		–
	Net expenses		6,434,310		1,635,511		685,960		6,456,389		4,722,922		3,541,568
Net investment income			5,562,463		2,722,923		82,134		3,925,573		5,773,611		3,806,302


REALIZED & UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS:
Net realized gain (loss) from:
	Investment transactions		18,982,854		159,577		–		62,818,241		(9,496,103)		5,309,590
	Foreign currency transactions		15,179		–		–		(88,196)		–		–
Net realized gain (loss)			18,998,033		159,577		–		62,730,045		(9,496,103)		5,309,590
Net change in unrealized appreciation (depreciation)			45,968,377		(553,611)		–		(1,817,667)		81,342,794		44,423,224
	Net realized and unrealized gain (loss) on investments and foreign currency transactions		64,966,410		(394,034)		–		60,912,378		71,846,691		49,732,814
Net increase in net assets resulting from operations		$	70,528,873	$	2,328,889	$	82,134	$	64,837,951	$	77,620,302	$	53,539,116

*Net of foreign taxes withheld as follows		$	628,120	$	–	$	–	$	200,039	$	33	$	5,527

See Notes to Financial Statements

DAVIS SERIES, INC.	Statements of Changes in Net Assets
	For the year ended December 31, 2010

			Davis Opportunity Fund		Davis Government Bond Fund		Davis Government Money Market Fund		Davis Financial Fund		Davis Appreciation & Income Fund		Davis Real Estate Fund

OPERATIONS:
Net investment income			$	5,562,463	$	2,722,923	$	82,134	$	3,925,573	$	5,773,611	$	3,806,302

Net realized gain (loss) from investments and foreign currency transactions				18,998,033		159,577		–		62,730,045		(9,496,103)		5,309,590

Net change in unrealized appreciation (depreciation) on investments and foreign currency transactions				45,968,377		(553,611)		–		(1,817,667)		81,342,794		44,423,224
		Net increase in net assets resulting from operations		70,528,873		2,328,889		82,134		64,837,951		77,620,302		53,539,116

DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income:
	Class A			(3,786,969)		(2,626,180)		(72,990)		(3,475,871)		(4,498,839)		(3,982,069)
	Class B			(90,218)		(271,442)		(4,924)		–		(125,426)		(35,139)
	Class C			(670,299)		(709,744)		(3,773)		–		(641,290)		(248,560)
	Class Y			(2,178,584)		(99,381)		(447)		(167,814)		(528,827)		(340,772)

CAPITAL SHARE TRANSACTIONS:
Net increase (decrease) in net assets resulting from capital share transactions (Note 5):
	Class A			(55,569,115)		12,429,430		31,629,598		(148,779,153)		(7,173,917)		(27,677,695)
	Class B			(6,075,493)		(2,180,488)		(6,005,721)		(4,314,420)		(4,084,525)		(2,013,551)
	Class C			(28,269,427)		(6,003,338)		(6,575,538)		(10,062,569)		(16,368,414)		(4,088,011)
	Class Y			88,769,912		405,901		1,996,509		3,934,801		(20,783,071)		(10,384,526)
		Total increase (decrease) in net assets		62,658,680		3,273,647		21,044,848		(98,027,075)		23,415,993		4,768,793

NET ASSETS:
Beginning of year				553,603,908		160,853,158		299,642,249		689,031,002		429,063,049		295,780,286
End of year*			$	616,262,588	$	164,126,805	$	320,687,097	$	591,003,927	$	452,479,042	$	300,549,079

*Including undistributed net investment income of			$	768,483	$	–	$	–	$	4,165,218	$	43,760	$	1,543,538

See Notes to Financial Statements

DAVIS SERIES, INC.	Statements of Changes in Net Assets
	For the year ended December 31, 2009

			Davis Opportunity Fund		Davis Government Bond Fund		Davis Government Money Market Fund		Davis Financial Fund		Davis Appreciation & Income Fund		Davis Real Estate Fund

OPERATIONS:
Net investment income			$	1,691,620	$	4,068,681	$	1,063,410	$	2,229,688	$	6,962,276	$	6,105,794

Net realized gain (loss) from investments and foreign currency transactions				(53,239,160)		460,405		–		(45,321,845)		(104,423,812)		(169,934,631)

Net change in unrealized appreciation (depreciation) on investments and foreign currency transactions				224,767,280		407,368		–		265,159,148		249,462,410		233,356,725
		Net increase in net assets resulting from operations		173,219,740		4,936,454		1,063,410		222,066,991		152,000,874		69,527,888

DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income:
	Class A			(1,220,051)		(3,235,568)		(887,940)		(717,066)		(4,919,857)		(3,004,137)
	Class B			–		(391,386)		(88,252)		–		(198,424)		(47,527)
	Class C			–		(975,534)		(86,828)		–		(960,119)		(248,437)
	Class Y			(552,961)		(80,952)		(390)		(30,470)		(984,491)		(419,679)

CAPITAL SHARE TRANSACTIONS:
Net increase (decrease) in net assets resulting from capital share transactions (Note 5):
	Class A			(46,442,118)		8,602,758		(73,637,810)		(30,178,606)		(44,681,910)		(21,257,761)
	Class B			(5,978,278)		(151,208)		(8,242,572)		(4,518,956)		(3,836,556)		(2,323,010)
	Class C			(29,855,044)		1,560,325		(13,670,227)		(7,572,111)		(21,878,449)		(5,766,914)
	Class Y			14,161,637		1,407,905		(18,129)		2,459,346		(19,321,443)		(9,209,842)
		Total increase (decrease) in net assets		103,332,925		11,672,794		(95,568,738)		181,509,128		55,219,625		27,250,581

NET ASSETS:
Beginning of year				450,270,983		149,180,364		395,210,987		507,521,874		373,843,424		268,529,705
End of year*			$	553,603,908	$	160,853,158	$	299,642,249	$	689,031,002	$	429,063,049	$	295,780,286

*Including undistributed (overdistributed) net investment income of			$	(406,375)	$	–	$	–	$	2,199,094	$	64,531	$	2,343,776

See Notes to Financial Statements

DAVIS SERIES, INC.	Notes to Financial Statements
	December 31, 2010

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Davis Series, Inc. (a Maryland corporation) (“Company”), is registered under the Investment Company Act of 1940 (“40 Act”) as amended, as an open-end management investment company. Davis Opportunity Fund, Davis Government Bond Fund, Davis Government Money Market Fund, Davis Financial Fund, and Davis Appreciation & Income Fund are diversified under the 40 Act. Davis Real Estate Fund is non-diversified under the 40 Act. The Company operates as a series issuing shares of common stock in the following six funds (collectively “Funds”):

Davis Opportunity Fund seeks to achieve long-term growth of capital. It invests primarily in common stocks and other equity securities, and may invest in both domestic and foreign issuers.

Davis Government Bond Fund seeks to achieve current income. It invests in debt securities which are obligations of, or which are guaranteed by, the U.S. Government, its agencies or instrumentalities.

Davis Government Money Market Fund seeks to achieve as high a level of current income as is consistent with the principle of preservation of capital and maintenance of liquidity.

The Fund is a money market fund that seeks to preserve the value of your investment at $1.00 per share. There can be no guarantee that the Fund will be successful in maintaining a $1.00 share price.

It invests exclusively in U.S. Treasury securities, U.S. Government securities, U.S. Government agency securities, U.S. Government agency mortgage securities (collectively “U.S. Government Securities”), and repurchase agreements collateralized by U.S. Government Securities. The Fund seeks to maintain liquidity and preserve capital by carefully monitoring the maturity of its investments. The Fund’s portfolio maintains a dollar-weighted average maturity of sixty days or less.

Davis Financial Fund seeks to achieve long-term growth of capital. It invests primarily in common stocks and other equity securities, and will concentrate investments in companies principally engaged in the banking, insurance, and financial service industries.

Davis Appreciation & Income Fund seeks to achieve total return through a combination of growth and income. Under normal circumstances, the Fund invests in a diversified portfolio of convertible securities, common and preferred stock, and fixed income securities. It may invest in lower rated bonds commonly known as “junk bonds”. The Fund may hold securities in default, and is not obligated to dispose of securities whose issuers or underlying obligors subsequently default. As of December 31, 2010, the value of defaulted securities amounted to $681,625 (cost: $9,921,191) or 0.15% of the Fund’s net assets.

Davis Real Estate Fund seeks to achieve total return through a combination of growth and income. It invests primarily in securities of companies principally engaged in or related to the real estate industry or which own significant real estate assets or which primarily invest in real estate financial instruments.

Because of the risk inherent in any investment program, the Company cannot ensure that the investment objective of any of its series will be achieved.

The Company accounts separately for the assets, liabilities, and operations of each Fund. Each Fund offers shares in four classes, Class A, Class B, Class C, and Class Y. Class A shares are sold with a front-end sales charge, except for shares of the Davis Government Money Market Fund, which are sold at net asset value. Class B and C shares are sold at net asset value and may be subject to a contingent deferred sales charge upon redemption. Class Y shares are sold at net asset value and are not subject to any contingent deferred sales charge. Class Y shares are only available to certain qualified investors. Income, expenses (other than those attributable to a specific class), and gains and losses are allocated daily to each class of shares based upon the relative proportion of net assets represented by each class. Operating expenses directly attributable to a specific class, such as distribution and transfer agent fees, are charged against the operations of that class. All expenses for Davis Government Money Market Fund are allocated evenly across all classes of shares based upon the relative portion of net assets represented by each class. All classes have identical rights with respect to voting (exclusive of each class’ distribution arrangement), liquidation, and distributions. The following is a summary of significant accounting policies followed by the Funds in the preparation of their financial statements.

DAVIS SERIES, INC.	Notes to Financial Statements – (Continued)
	December 31, 2010

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – (CONTINUED)

Security Valuation - The Funds calculate the net asset value of their shares as of the close of the New York Stock Exchange (“Exchange”), normally 4:00 P.M. Eastern time, on each day the Exchange is open for business. Securities listed on the Exchange (and other national exchanges) are valued at the last reported sales price on the day of valuation. Securities traded in the over-the-counter market (e.g. NASDAQ) and listed securities for which no sale was reported on that date are stated at the average of closing bid and asked prices. Securities traded on foreign exchanges are valued based upon the last sales price on the principal exchange on which the security is traded prior to the time when the Funds’ assets are valued. Securities (including restricted securities) for which market quotations are not readily available are valued at their fair value. Securities whose values have been materially affected by what Davis Selected Advisers, L.P. (“Davis Advisors” or “Adviser”), the Funds’ investment adviser, identifies as a significant event occurring before the Funds’ assets are valued but after the close of their respective exchanges will be fair valued. Fair value is determined in good faith using consistently applied procedures under the supervision of the Board of Directors. Short-term securities purchased within 60 days to maturity are valued at amortized cost, which approximates market value. The value of short-term securities originally purchased with maturities greater than 60 days, are valued at market value. For Davis Government Money Market Fund, in compliance with Rule 2a-7 of the 40 Act, securities are valued at amortized cost, which approximates market value. These valuation procedures are reviewed and subject to approval by the Board of Directors.

Value Measurements - Fair value is defined as the price that the Funds would receive upon selling an investment in an orderly transaction to an independent buyer in the principal or most advantageous market for the investment. Various inputs are used to determine the fair value of the Funds’ investments. These inputs are summarized in the three broad levels listed below.

Level 1 – quoted prices in active markets for identical securities

Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

Level 3 – significant unobservable inputs (including 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. Money market securities are valued using amortized cost, in accordance with rules under the 40 Act. Generally, amortized cost approximates the current fair value of a security, but since the value is not obtained from a quoted price in an active market, such securities are reflected as Level 2.

DAVIS SERIES, INC.	Notes to Financial Statements – (Continued)
	December 31, 2010

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – (CONTINUED)

Value Measurements – (Continued)

The following is a summary of the inputs used as of December 31, 2010 in valuing each Fund’s investments carried at value:

Investments in Securities at Value

Davis

Government

Davis

Appreciation

Davis

Opportunity

Government

Money Market

Financial

& Income

Real Estate

Fund

Bond Fund

Fund

Valuation inputs

Level 1 – Quoted prices:

Equity securities:

Consumer discretionary

44,997,331

–

35,656,964

1,903,800

Consumer staples

77,053,763

–

31,655,492

–

Energy

40,506,686

–

39,795,434

38,474,254

–

Financials

55,444,315

–

497,531,542

50,646,843

235,936,164

Health care

106,252,817

–

11,918,790

–

Industrials

43,565,711

–

14,989,798

48,760,262

8,990,738

Information technology

113,453,418

–

17,922,253

–

Materials

62,716,339

–

20,738,652

–

Telecommunication services

3,315,399

–

26,172,860

Utilities

–

20,234,399

–

Total Level 1

547,305,779

–

552,316,774

276,007,909

273,003,562

Level 2 – Other Significant

Observable Inputs:

Debt securities issued by U.S. Treasuries and U.S. Government corporations and agencies:

Long-term

–

159,786,622

–

Short-term

–

139,032,372

–

Convertible debt securities

–

145,054,462

9,155,912

Corporate debt securities

–

13,886,840

–

Equity securities:

Financials

24,539,375

–

34,506,000

–

2,531,582

Industrials

–

10,983,728

–

Short-term securities

44,228,000

4,488,000

158,984,000

210,000

6,516,000

15,165,000

Total Level 2

68,767,375

164,274,622

298,016,372

34,716,000

176,441,030

26,852,494

Level 3 – Significant Unobservable

Inputs:

Equity securities:

Financials

–

2,853,406

–

Total

616,073,154

164,274,622

298,016,372

589,886,180

452,448,939

299,856,056

Level 2 to Level 1 Transfers*:

Consumer discretionary

16,390,880

–

Consumer staples

9,305,244

–

Financials

–

53,777,908

–

Industrials

11,025,112

–

Total

36,721,236

–

53,777,908

–

*Application of fair value procedures for securities traded on foreign markets triggered transfers between Level 1 and Level 2 assets during the year ended December 31, 2010.

DAVIS SERIES, INC.	Notes to Financial Statements – (Continued)
	December 31, 2010

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – (CONTINUED)

Value Measurements – (Continued)

The following table reconciles the valuation of assets in which significant unobservable inputs (Level 3) were used in determining fair value for the year ended December 31, 2010:

	Davis Financial Fund
Investment Securities:
Beginning balance	$	–
Unrealized depreciation		(1,536,447)
Net purchases (sales)		4,389,853
Ending balance	$	2,853,406

The cost of purchases and the proceeds from sales may include securities received or delivered through corporate actions or exchanges. Realized and unrealized gains (losses) are included in the related amounts on investments in the Statement of Operations.

Master Repurchase Agreements - The Funds, along with other affiliated funds, may transfer uninvested cash balances into one or more master repurchase agreement accounts. These balances are invested in one or more repurchase agreements, secured by U.S. Government securities. A custodian bank holds securities pledged as collateral for repurchase agreements until the agreements mature. Each agreement requires that the market value of the collateral be sufficient to cover payments of interest and principal; however, in the event of default by the other party to the agreement, retention of the collateral may be subject to legal proceedings.

Currency Translation - The market values of all assets and liabilities denominated in foreign currencies are recorded in the financial statements after translation to the U.S. Dollar based upon the mean between the bid and offered quotations of the currencies against U.S. Dollars on the date of valuation. The cost basis of such assets and liabilities is determined based upon historical exchange rates. Income and expenses are translated at average exchange rates in effect as accrued or incurred.

Foreign Currency - The Funds may enter into forward purchases or sales of foreign currencies to hedge certain foreign currency denominated assets and liabilities against declines in market value relative to the U.S. Dollar. Forward currency contracts are marked-to-market daily and the change in market value is recorded by the Funds as an unrealized gain or loss. When the forward currency contract is closed, the Funds record a realized gain or loss equal to the difference between the value of the forward currency contract at the time it was opened and value at the time it was closed. Investments in forward currency contracts may expose the Funds to risks resulting from unanticipated movements in foreign currency exchange rates or failure of the counter-party to the agreement to perform in accordance with the terms of the contract.

Reported net realized foreign exchange gains or losses arise from the sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions, the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Funds’ books, and the U.S. Dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in the value of assets and liabilities other than investments in securities at fiscal year end, resulting from changes in the exchange rate. The Funds include foreign currency gains and losses realized on the sale of investments together with market gains and losses on such investments in the Statements of Operations.

DAVIS SERIES, INC.	Notes to Financial Statements – (Continued)
	December 31, 2010

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – (CONTINUED)

Federal Income Taxes - It is each Fund’s policy to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies, and to distribute substantially all of its taxable income, including any net realized gains on investments not offset by loss carryovers, to shareholders. Therefore, no provision for federal income tax is required. Davis Opportunity Fund and Davis Government Money Market Fund incurred a 2009 excise tax liability of $41,926 and $2,480, respectively, during the year ended December 31, 2010. The Adviser has analyzed the Funds’ tax positions taken on federal and state income tax returns for all open tax years and has concluded that as of December 31, 2010, no provision for income tax would be required in the Funds’ financial statements related to these tax positions. The Funds’ federal and state (Arizona and Maryland) income and federal excise tax returns for tax years for which the applicable statutes of limitations have not expired are subject to examination by the Internal Revenue Service and state departments of revenue. The earliest tax year that remains subject to examination by these jurisdictions is 2007. At December 31, 2010, each Fund had available for federal income tax purposes unused capital loss carryforwards and post October 2010 capital losses as follows:

	Capital Loss Carryforwards
							Davis
	Davis		Davis		Davis		Appreciation		Davis
	Opportunity		Government		Financial		& Income		Real Estate
	Fund		Bond Fund		Fund		Fund		Fund
Expiring
12/31/2011	$	–	$	2,128,000	$	–	$	–	$	–
12/31/2012		–		1,243,000		–		–		–
12/31/2013		–		403,000		–		–		–
12/31/2014		–		304,000		–		–		–
12/31/2015		–		136,000		–		–		–
12/31/2016		69,607,000		–		–		430,000		4,103,000
12/31/2017		76,236,000		355,000		20,934,000		89,303,000		157,169,000
12/31/2018		–		625,000		–		31,335,000		–
Total	$	145,843,000	$	5,194,000	$	20,934,000	$	121,068,000	$	161,272,000


Utilized in 2010	$	17,677,000	$	–	$	31,679,000	$	–	$	4,586,000

	Post October 2010 Capital Losses (expiring 12/31/2019)
Davis Government Bond Fund	$	235,000

The Regulated Investment Company Modernization Act of 2010 (the “Act”) was enacted on December 22, 2010. The Act makes changes to several tax rules impacting the Funds. In general, the provisions of the Act will be effective for the Funds’ fiscal year ending December 31, 2011. Although the Act provides several benefits, including the unlimited carryforward of future capital losses, there may be a greater likelihood that all or a portion of each Fund’s pre-enactment capital loss carryforwards may expire without being utilized due to the fact that post-enactment capital losses get utilized before pre-enactment capital loss carryforwards. Relevant information regarding the impact of the Act on the Funds, if any, will be contained within the “Federal Income Taxes” section of the Notes to Financial Statements for the fiscal year ending December 31, 2011.

Securities Transactions and Related Investment Income - Securities transactions are accounted for on the trade date (date the order to buy or sell is executed) with realized gain or loss on the sale of securities being determined based upon identified cost. Dividend income is recorded on the ex-dividend date. Dividend income from REIT securities may include return of capital. Upon notification from the issuer, the amount of the return of capital is reclassified to adjust dividend income, reduce the cost basis, and/or adjust realized gain/loss. Interest income, which includes accretion of discount and amortization of premium, is accrued as earned.

DAVIS SERIES, INC.	Notes to Financial Statements – (Continued)
	December 31, 2010

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – (CONTINUED)

Dividends and Distributions to Shareholders - Dividends and distributions to shareholders are recorded on the ex-dividend date. Net investment income (loss), net realized gains (losses), and net unrealized appreciation (depreciation) on investments may differ for financial statement and tax purposes primarily due to differing treatments of wash sales, paydowns on fixed income securities, foreign currency transactions, net operating losses, passive foreign investment company shares, partnership income, and distributions from real estate investment trusts. The character of dividends and distributions made during the fiscal year from net investment income and net realized securities gains may differ from their ultimate characterization for federal income tax purposes. Also, due to the timing of dividends and distributions, the fiscal year in which amounts are distributed may differ from the fiscal year in which income or realized gain was recorded by the Funds. The Funds adjust certain components of capital to reflect permanent differences between financial statement amounts and net income and realized gains/losses determined in accordance with income tax rules. Accordingly, during the year ended December 31, 2010, for Davis Opportunity Fund, amounts have been reclassified to reflect an increase in undistributed net investment income of $2,338,465, an increase in accumulated net realized losses from investments and foreign currency transactions of $2,296,586, and a decrease in paid in capital of $41,879; for Davis Government Bond Fund, amounts have been reclassified to reflect a decrease in overdistributed net investment income of $983,824 and a corresponding increase in accumulated net realized losses from investment transactions; for Davis Financial Fund, amounts have been reclassified to reflect an increase in undistributed net investment income of $1,684,236, a decrease in accumulated net realized gains from investments and foreign currency transactions of $34,436,720, and an increase in paid in capital of $32,752,484; for Davis Appreciation & Income Fund, amounts have been reclassified to reflect an increase in accumulated net realized losses from investments of $2,364,890 and a corresponding increase in paid in capital. The Funds’ net assets have not been affected by these reclassifications.

The tax character of distributions paid during the years ended December 31, 2010 and 2009 was as follows:

	Ordinary Income		Long-Term Capital Gain		Return of Capital		Total
Davis Opportunity Fund
2010	$	6,726,070	$	–	$	–	$	6,726,070
2009		1,773,012		–		–		1,773,012

Davis Government Bond Fund
2010		3,706,747		–		–		3,706,747
2009		4,683,440		–		–		4,683,440

Davis Government Money Market Fund
2010		82,134		–		–		82,134
2009		1,063,410		–		–		1,063,410
Davis Financial Fund
2010		3,643,685		–		–		3,643,685
2009		747,536		–		–		747,536

Davis Appreciation & Income Fund
2010		5,794,382		–		–		5,794,382
2009		7,062,891		–		–		7,062,891

Davis Real Estate Fund
2010		4,606,540		–		–		4,606,540
2009		3,719,780		–		–		3,719,780

As of December 31, 2010, the components of distributable earnings (accumulated losses) on a tax basis were as follows:

	Davis Opportunity Fund		Davis Government Bond Fund		Davis Financial Fund		Davis Appreciation & Income Fund		Davis Real Estate Fund
Undistributed net investment income	$	7,505,562	$	4,647	$	4,181,876	$	55,542	$	1,552,065
Accumulated net realized losses from investments and foreign currency transactions		(145,842,740)		(5,429,375)		(20,933,841)		(121,067,700)		(161,272,105)
Net unrealized appreciation on investments		109,844,124		1,243,678		203,487,462		39,020,836		56,746,598
Total	$	(28,493,054)	$	(4,181,050)	$	186,735,497	$	(81,991,322)	$	(102,973,442)

DAVIS SERIES, INC.	Notes to Financial Statements – (Continued)
	December 31, 2010

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – (CONTINUED)

Indemnification - Under the Funds’ organizational documents, their officers and directors are indemnified against certain liabilities arising out of the performance of their duties to the Funds. In addition, some of the Funds’ contracts with their service providers contain general indemnification clauses. The Funds’ maximum exposure under these arrangements is unknown since the amount of any future claims that may be made against the Funds cannot be determined and the Funds have no historical basis for predicting the likelihood of any such claims.

Use of Estimates in Financial Statements - In preparing financial statements in conformity with accounting principles generally accepted in the United States of America, management makes estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of income and expenses during the reporting period. Actual results may differ from these estimates.

Directors Fees and Expenses - The Funds set up a Rabbi Trust to provide for the deferred compensation plan for Independent Directors that enables them to elect to defer receipt of all or a portion of annual fees they are entitled to receive. The value of an eligible Director’s account is based upon years of service and fees paid to each Director during the years of service. The amount paid to the Director by the Trust under the plan will be determined based upon the performance of the Davis Funds in which the amounts are invested.

Unfunded Capital Commitments - Unfunded capital commitments represent agreements which obligate a fund to meet capital calls in the future. Payment would be made when a capital call is requested. Capital calls can only be made if and when certain requirements have been fulfilled; thus, the timing and the amount of such capital calls cannot readily be determined. Unfunded capital commitments are recorded when capital calls are requested. As of December 31, 2010, unfunded capital commitments in Davis Financial Fund amounted to $9,310,147.

NOTE 2 - PURCHASES AND SALES OF SECURITIES

The cost of purchases and proceeds from sales of investment securities (excluding short-term securities) during the year ended December 31, 2010 were as follows:

							Davis
	Davis		Davis		Davis		Appreciation		Davis
	Opportunity		Government		Financial		& Income		Real Estate
	Fund		Bond Fund		Fund		Fund		Fund
Cost of purchases	$	127,757,829	$	115,145,252	$	9,489,541	$	83,579,941	$	122,415,116
Proceeds of sales		157,326,855		49,518,988		169,425,185		135,431,181		156,916,838

DAVIS SERIES, INC.	Notes to Financial Statements – (Continued)
	December 31, 2010

NOTE 3 - INVESTMENT ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES

Advisory fees are paid monthly to the Adviser. The annual rate for each of the Davis Opportunity Fund, Davis Financial Fund, Davis Appreciation & Income Fund, and Davis Real Estate Fund is 0.55% of the average net assets. The annual rate for the Davis Government Bond Fund is 0.30% of the average net assets. The annual rate for the Davis Government Money Market Fund is 0.50% of the first $250 million of average net assets, 0.45% of the next $250 million, and 0.40% of average net assets in excess of $500 million. The Adviser agrees to waive some or all of its advisory fees and to reimburse expenses to the extent necessary so that the Fund’s investment income will not be less than zero until May 1, 2011. During the year ended December 31, 2010, such waivers and reimbursements amounted to $1,358,706.

Boston Financial Data Services, Inc. (“BFDS”) is the Funds’ primary transfer agent. The Adviser is also paid for certain transfer agent services. The fee paid to the Adviser for these services for the year ended December 31, 2010 for the Davis Opportunity Fund, Davis Government Bond Fund, Davis Government Money Market Fund, Davis Financial Fund, Davis Appreciation & Income Fund, and Davis Real Estate Fund amounted to $48,786, $14,714, $17,175, $72,394, $44,806, and $40,944, respectively. State Street Bank and Trust Company (“State Street Bank”) is the Funds’ primary accounting provider. Fees for such services are included in the custodian fee as State Street Bank also serves as the Funds’ custodian. The Adviser is also paid for certain accounting services. The fee paid to the Adviser for these services for the year ended December 31, 2010 for the Davis Opportunity Fund, Davis Government Bond Fund, Davis Government Money Market Fund, Davis Financial Fund, Davis Appreciation & Income Fund, and Davis Real Estate Fund amounted to $7,500, $3,000, $5,502, $8,748, $6,504, and $4,500, respectively. Certain directors and officers of the Funds are also directors and officers of the general partner of the Adviser.

Davis Selected Advisers-NY, Inc. (“DSA-NY”), a wholly-owned subsidiary of the Adviser, acts as sub-adviser to the Funds. DSA-NY performs research and portfolio management services for the Funds under a Sub-Advisory Agreement with the Adviser. The Funds pay no fees directly to DSA-NY.

NOTE 4 - EXPENSES PAID INDIRECTLY

Under an agreement with State Street Bank, custodian fees are reduced for earnings on cash balances maintained at the custodian by the Funds. Such reductions amounted to $378, $3, $39, $18, $76, and $3 for the Davis Opportunity Fund, Davis Government Bond Fund, Davis Government Money Market Fund, Davis Financial Fund, Davis Appreciation & Income Fund, and Davis Real Estate Fund, respectively, during the year ended December 31, 2010.

DAVIS SERIES, INC.	Notes to Financial Statements – (Continued)
	December 31, 2010

NOTE 5 - CAPITAL STOCK

At December 31, 2010, there were 10 billion shares of capital stock ($0.01 par value per share) authorized, of which 550 million shares each are designated to the Davis Opportunity Fund, Davis Government Bond Fund, Davis Financial Fund, Davis Appreciation & Income Fund, and Davis Real Estate Fund, and 4.2 billion shares are designated to the Davis Government Money Market Fund. Transactions in capital stock were as follows:

Class A		Year ended December 31, 2010
			Davis Opportunity Fund		Davis Government Bond Fund		Davis Government Money Market Fund		Davis Financial Fund		Davis Appreciation & Income Fund		Davis Real Estate Fund
Shares sold			1,536,876		12,274,253		493,101,326		2,297,399		2,385,567		1,432,227
Shares issued in reinvestment of distributions			167,725		431,947		71,770		77,720		133,215		157,969
			1,704,601		12,706,200		493,173,096		2,375,119		2,518,782		1,590,196
Shares redeemed*			(4,483,484)		(10,516,292)		(461,543,498)		(7,341,103)		(2,840,848)		(2,873,564)
	Net increase (decrease)		(2,778,883)		2,189,908		31,629,598		(4,965,984)		(322,066)		(1,283,368)

Proceeds from shares sold		$	31,137,838	$	69,518,698	$	493,101,326	$	68,223,609	$	60,264,692	$	30,834,017
Proceeds from shares issued in reinvestment of distributions			3,549,074		2,448,085		71,770		2,388,330		3,442,223		3,462,309
			34,686,912		71,966,783		493,173,096		70,611,939		63,706,915		34,296,326
Cost of shares redeemed*			(90,256,027)		(59,537,353)		(461,543,498)		(219,391,092)		(70,880,832)		(61,974,021)
	Net increase (decrease)	$	(55,569,115)	$	12,429,430	$	31,629,598	$	(148,779,153)	$	(7,173,917)	$	(27,677,695)

* Includes a redemption as a result of an in-kind transfer of securities for Davis Financial Fund (see Note 9 of the Notes to Financial Statements).

Class A		Year ended December 31, 2009
			Davis Opportunity Fund		Davis Government Bond Fund		Davis Government Money Market Fund		Davis Financial Fund		Davis Appreciation & Income Fund		Davis Real Estate Fund
Shares sold			2,541,205		10,003,448		490,192,494		3,779,450		2,044,107		2,318,057
Shares issued in reinvestment of distributions			57,859		522,251		872,174		18,948		181,514		196,560
			2,599,064		10,525,699		491,064,668		3,798,398		2,225,621		2,514,617
Shares redeemed			(5,810,823)		(9,002,348)		(564,702,478)		(5,062,362)		(4,716,485)		(3,965,647)
	Net increase (decrease)		(3,211,759)		1,523,351		(73,637,810)		(1,263,964)		(2,490,864)		(1,451,030)

Proceeds from shares sold		$	41,481,623	$	56,639,743	$	490,192,494	$	83,479,766	$	38,353,766	$	34,092,824
Proceeds from shares issued in reinvestment of distributions			1,150,228		2,959,875		872,174		539,583		3,712,634		2,675,552
			42,631,851		59,599,618		491,064,668		84,019,349		42,066,400		36,768,376
Cost of shares redeemed			(89,073,969)		(50,996,860)		(564,702,478)		(114,197,955)		(86,748,310)		(58,026,137)
	Net increase (decrease)	$	(46,442,118)	$	8,602,758	$	(73,637,810)	$	(30,178,606)	$	(44,681,910)	$	(21,257,761)

DAVIS SERIES, INC.	Notes to Financial Statements – (Continued)
	December 31, 2010

NOTE 5 - CAPITAL STOCK – (CONTINUED)

Class B		Year ended December 31, 2010
			Davis Opportunity Fund		Davis Government Bond Fund		Davis Government Money Market Fund		Davis Financial Fund		Davis Appreciation & Income Fund		Davis Real Estate Fund
Shares sold			62,276		1,018,359		4,889,548		42,243		139,161		36,478
Shares issued in reinvestment of distributions			4,693		39,926		4,678		–		4,308		1,462
			66,969		1,058,285		4,894,226		42,243		143,469		37,940
Shares redeemed			(420,574)		(1,445,708)		(10,899,947)		(215,943)		(309,443)		(131,822)
	Net decrease		(353,605)		(387,423)		(6,005,721)		(173,700)		(165,974)		(93,882)

Proceeds from shares sold		$	1,072,598	$	5,756,229	$	4,889,548	$	1,069,703	$	3,512,920	$	792,262
Proceeds from shares issued in reinvestment of distributions			85,136		225,675		4,678		–		110,998		31,502
			1,157,734		5,981,904		4,894,226		1,069,703		3,623,918		823,764
Cost of shares redeemed			(7,233,227)		(8,162,392)		(10,899,947)		(5,384,123)		(7,708,443)		(2,837,315)
	Net decrease	$	(6,075,493)	$	(2,180,488)	$	(6,005,721)	$	(4,314,420)	$	(4,084,525)	$	(2,013,551)

Class B		Year ended December 31, 2009
			Davis Opportunity Fund		Davis Government Bond Fund		Davis Government Money Market Fund		Davis Financial Fund		Davis Appreciation & Income Fund		Davis Real Estate Fund
Shares sold			173,839		1,802,024		9,798,332		91,436		148,134		21,555
Shares issued in reinvestment of distributions			–		56,065		79,384		–		8,419		3,431
			173,839		1,858,089		9,877,716		91,436		156,553		24,986
Shares redeemed			(636,333)		(1,883,839)		(18,120,288)		(339,617)		(368,673)		(187,518)
	Net decrease		(462,494)		(25,750)		(8,242,572)		(248,181)		(212,120)		(162,532)

Proceeds from shares sold		$	2,540,065	$	10,175,367	$	9,798,332	$	1,721,208	$	2,846,327	$	340,230
Proceeds from shares issued in reinvestment of distributions			–		316,821		79,384		–		173,077		44,441
			2,540,065		10,492,188		9,877,716		1,721,208		3,019,404		384,671
Cost of shares redeemed			(8,518,343)		(10,643,396)		(18,120,288)		(6,240,164)		(6,855,960)		(2,707,681)
	Net decrease	$	(5,978,278)	$	(151,208)	$	(8,242,572)	$	(4,518,956)	$	(3,836,556)	$	(2,323,010)

DAVIS SERIES, INC.	Notes to Financial Statements – (Continued)
	December 31, 2010

NOTE 5 - CAPITAL STOCK – (CONTINUED)

Class C		Year ended December 31, 2010
			Davis Opportunity Fund		Davis Government Bond Fund		Davis Government Money Market Fund		Davis Financial Fund		Davis Appreciation & Income Fund		Davis Real Estate Fund
Shares sold			318,727		2,832,791		7,393,271		384,075		394,449		176,276
Shares issued in reinvestment of distributions			33,520		108,367		3,619		–		22,695		10,699
			352,247		2,941,158		7,396,890		384,075		417,144		186,975
Shares redeemed			(1,928,119)		(4,005,937)		(13,972,428)		(784,085)		(1,074,125)		(378,573)
	Net decrease		(1,575,872)		(1,064,779)		(6,575,538)		(400,010)		(656,981)		(191,598)

Proceeds from shares sold		$	5,867,026	$	16,070,333	$	7,393,271	$	10,055,476	$	10,051,523	$	3,843,946
Proceeds from shares issued in reinvestment of distributions			639,573		614,427		3,619		–		592,560		234,328
			6,506,599		16,684,760		7,396,890		10,055,476		10,644,083		4,078,274
Cost of shares redeemed			(34,776,026)		(22,688,098)		(13,972,428)		(20,118,045)		(27,012,497)		(8,166,285)
	Net decrease	$	(28,269,427)	$	(6,003,338)	$	(6,575,538)	$	(10,062,569)	$	(16,368,414)	$	(4,088,011)

Class C		Year ended December 31, 2009
			Davis Opportunity Fund		Davis Government Bond Fund		Davis Government Money Market Fund		Davis Financial Fund		Davis Appreciation & Income Fund		Davis Real Estate Fund
Shares sold			568,321		5,383,225		17,141,127		506,584		496,987		179,522
Shares issued in reinvestment of distributions			–		147,757		80,409		–		41,422		17,069
			568,321		5,530,982		17,221,536		506,584		538,409		196,591
Shares redeemed			(2,773,565)		(5,255,547)		(30,891,763)		(902,551)		(1,762,872)		(599,769)
	Net increase (decrease)		(2,205,244)		275,435		(13,670,227)		(395,967)		(1,224,463)		(403,178)

Proceeds from shares sold		$	8,579,004	$	30,496,325	$	17,141,127	$	10,057,264	$	9,405,139	$	2,820,892
Proceeds from shares issued in reinvestment of distributions			–		837,568		80,409		–		857,125		227,557
			8,579,004		31,333,893		17,221,536		10,057,264		10,262,264		3,048,449
Cost of shares redeemed			(38,434,048)		(29,773,568)		(30,891,763)		(17,629,375)		(32,140,713)		(8,815,363)
	Net increase (decrease)	$	(29,855,044)	$	1,560,325	$	(13,670,227)	$	(7,572,111)	$	(21,878,449)	$	(5,766,914)

DAVIS SERIES, INC.	Notes to Financial Statements – (Continued)
	December 31, 2010

NOTE 5 - CAPITAL STOCK – (CONTINUED)

Class Y		Year ended December 31, 2010
			Davis Opportunity Fund		Davis Government Bond Fund		Davis Government Money Market Fund		Davis Financial Fund		Davis Appreciation & Income Fund		Davis Real Estate Fund
Shares sold			6,734,815		1,177,828		2,468,855		554,282		533,653		394,630
Shares issued in reinvestment of distributions			95,890		16,014		447		4,859		19,052		14,942
			6,830,705		1,193,842		2,469,302		559,141		552,705		409,572
Shares redeemed*			(2,714,820)		(1,121,822)		(472,793)		(439,318)		(1,395,096)		(922,977)
	Net increase (decrease)		4,115,885		72,020		1,996,509		119,823		(842,391)		(513,405)

Proceeds from shares sold		$	143,906,979	$	6,718,043	$	2,468,855	$	16,501,316	$	13,351,234	$	8,481,571
Proceeds from shares issued in reinvestment of distributions			2,087,506		91,412		447		152,674		491,768		332,033
			145,994,485		6,809,455		2,469,302		16,653,990		13,843,002		8,813,604
Cost of shares redeemed*			(57,224,573)		(6,403,554)		(472,793)		(12,719,189)		(34,626,073)		(19,198,130)
	Net increase (decrease)	$	88,769,912	$	405,901	$	1,996,509	$	3,934,801	$	(20,783,071)	$	(10,384,526)

* Includes a redemption as a result of an in-kind transfer of securities for Davis Appreciation & Income Fund (see Note 9 of the Notes to Financial Statements).

Class Y		Year ended December 31, 2009
			Davis Opportunity Fund		Davis Government Bond Fund		Davis Government Money Market Fund		Davis Financial Fund		Davis Appreciation & Income Fund		Davis Real Estate Fund
Shares sold			2,365,816		883,870		130,867		250,077		302,545		323,839
Shares issued in reinvestment of distributions			24,730		12,136		383		973		45,493		29,536
			2,390,546		896,006		131,250		251,050		348,038		353,375
Shares redeemed			(1,544,945)		(649,885)		(149,379)		(168,931)		(1,450,969)		(952,687)
	Net increase (decrease)		845,601		246,121		(18,129)		82,119		(1,102,931)		(599,312)

Proceeds from shares sold		$	39,245,500	$	5,043,877	$	130,867	$	6,251,031	$	5,828,478	$	4,522,877
Proceeds from shares issued in reinvestment of distributions			505,740		69,268		383		28,299		927,169		402,591
			39,751,240		5,113,145		131,250		6,279,330		6,755,647		4,925,468
Cost of shares redeemed			(25,589,603)		(3,705,240)		(149,379)		(3,819,984)		(26,077,090)		(14,135,310)
	Net increase (decrease)	$	14,161,637	$	1,407,905	$	(18,129)	$	2,459,346	$	(19,321,443)	$	(9,209,842)

NOTE 6 - BANK BORROWINGS

Each Fund may borrow up to 5% of its assets from a bank to purchase portfolio securities, or for temporary and emergency purposes. The purchase of securities with borrowed funds creates leverage in the Fund. Each Fund has entered into an agreement, which enables it to participate with certain other funds managed by the Adviser in an unsecured line of credit with a bank, which permits borrowings up to $50 million, collectively. Interest is charged based on its borrowings, at a rate equal to the higher of the Federal Funds Rate or the Overnight Libor Rate, plus 1.25%. At December 31, 2010, Davis Financial Fund had no borrowings outstanding. For the year ended December 31, 2010, the average daily loan balance was $747,514 at an average interest rate of 1.48%. Davis Financial Fund had gross borrowings and gross repayments of $57,168,400 during the year ended December 31, 2010. The maximum amount of borrowings outstanding at any month end was $4,802,000 during the year ended December 31, 2010. Davis Opportunity Fund, Davis Government Bond Fund, Davis Government Money Market Fund, Davis Appreciation & Income Fund, and Davis Real Estate Fund had no borrowings during the year ended December 31, 2010.

DAVIS SERIES, INC.	Notes to Financial Statements – (Continued)
	December 31, 2010

NOTE 7 - DISTRIBUTION AND UNDERWRITING FEES

Class A Shares of the Davis Opportunity Fund, Davis Government Bond Fund, Davis Financial Fund, Davis Appreciation & Income Fund, and Davis Real Estate Fund - Class A shares of the Funds are sold at net asset value plus a sales charge and are redeemed at net asset value.

Davis Distributors, LLC, the Funds’ Underwriter (“Underwriter” or “Distributor”) received commissions earned on sales of Class A shares of the Funds (other than Davis Government Money Market Fund) of which a portion was retained by the Underwriter and the remaining was re-allowed to investment dealers.

The Underwriter is reimbursed for amounts paid to dealers as a service fee or commissions with respect to Class A shares sold by dealers, which remain outstanding during the period. The service fee is paid at the annual rate up to 1/4 of 1.00% of the average net assets maintained by the responsible dealers.

	Year ended December 31, 2010
							Davis
	Davis		Davis		Davis		Appreciation		Davis
	Opportunity		Government		Financial		& Income		Real Estate
	Fund		Bond Fund		Fund		Fund		Fund
Commissions retained by Underwriter	$	21,031	$	10,311	$	37,556	$	15,569	$	14,299
Commissions re-allowed to investment dealers		115,791		63,429		208,856		85,128		77,761
Total commissions earned on sales of Class A shares	$	136,822	$	73,740	$	246,412	$	100,697	$	92,060

Class A service fee	$	681,594	$	215,872	$	878,088	$	556,974	$	533,249

Class B Shares of the Davis Opportunity Fund, Davis Government Bond Fund, Davis Financial Fund, Davis Appreciation & Income Fund, and Davis Real Estate Fund - Class B shares of the Funds are sold at net asset value and are redeemed at net asset value. A contingent deferred sales charge may be assessed on shares redeemed within six years of purchase.

Each of the Funds (other than Davis Government Money Market Fund) pays the Distributor a distribution fee on Class B shares at an annual rate equal to the lesser of 1.25% of the average daily net asset value of the Class B shares or the maximum amount provided by applicable rule or regulation of the Financial Industry Regulatory Authority, Inc. (“FINRA”), which currently is 1.00%. The Funds pay the distribution fee on Class B shares in order: (i) to pay the Distributor commissions on Class B shares which have been sold and (ii) to enable the Distributor to pay service fees on Class B shares which have been sold.

Commission advances by the Distributor on the sale of Class B shares are re-allowed to qualified selling dealers.

A contingent deferred sales charge is imposed upon redemption of certain Class B shares of the Funds within six years of the original purchase. The charge is a declining percentage starting at 4.00% of the lesser of net asset value of the shares redeemed or the total cost of such shares.

	Year ended December 31, 2010
							Davis
	Davis		Davis		Davis		Appreciation		Davis
	Opportunity		Government		Financial		& Income		Real Estate
	Fund		Bond Fund		Fund		Fund		Fund
Distribution Plan Payments:
Distribution fees	$	155,387	$	117,312	$	93,482	$	141,005	$	46,936
Service fees		51,424		39,146		30,555		46,118		15,380
Commission advances by the Distributor
on the sale of Class B shares		21,847		58,625		21,546		54,056		9,068
Contingent deferred sales charges received by the
Distributor from Class B shares		38,717		38,210		27,713		50,872		8,871

DAVIS SERIES, INC.	Notes to Financial Statements – (Continued)
	December 31, 2010

NOTE 7 - DISTRIBUTION AND UNDERWRITING FEES – (CONTINUED)

Class C Shares of the Davis Opportunity Fund, Davis Government Bond Fund, Davis Financial Fund, Davis Appreciation & Income Fund, and Davis Real Estate Fund - Class C shares of the Funds are sold at net asset value and are redeemed at net asset value. A contingent deferred sales charge may be assessed on shares redeemed within the first year of purchase.

Each of the Funds (other than Davis Government Money Market Fund) pays the Distributor a distribution fee on Class C shares at an annual rate equal to the lesser of 1.25% of the average daily net asset value of the Class C shares or the maximum amount provided by applicable rule or regulation of the FINRA, which currently is 1.00%. The Funds pay the distribution fee on Class C shares in order: (i) to pay the Distributor commissions on Class C shares which have been sold and (ii) to enable the Distributor to pay service fees on Class C shares which have been sold.

Commission advances by the Distributor on the sale of Class C shares are re-allowed to qualified selling dealers.

A contingent deferred sales charge of 1.00% is imposed upon redemption of certain Class C shares of the Funds within the first year of the original purchase.

Year ended December 31, 2010
			Davis
Davis	Davis	Davis	Appreciation	Davis
Opportunity	Government	Financial	& Income	Real Estate
Fund	Bond Fund	Fund	Fund	Fund

Distribution Plan Payments:
Distribution fees	$	879,335	$	293,646	$	525,909	$	630,357	$	223,713
Service fees		293,112		97,882		175,303		210,119		74,571
Commission advances by the Distributor
on the sale of Class C shares		35,560		35,116		88,187		45,083		20,440
Contingent deferred sales charges received by the
Distributor from Class C shares		4,969		9,250		7,470		3,455		1,657

Davis Government Money Market Fund - All classes of shares of the Davis Government Money Market Fund are sold to investors at net asset value. The shareholders of the Davis Government Money Market Fund have adopted a Distribution expense plan in accordance with Rule 12b-1, which does not provide for any amounts to be paid directly to the Distributor as either compensation or reimbursement for distributing shares of the Fund, but does authorize the use of the advisory fee to the extent such fee may be considered to be indirectly financing any activity or expense which is primarily intended to result in the sale of Fund shares.

NOTE 8 - RESTRICTED SECURITIES

Restricted securities are not registered under the Securities Act of 1933 and may have contractual restrictions on resale. They are valued under methods approved by the Board of Directors as reflecting fair value. The aggregate value of restricted securities in Davis Opportunity Fund amounted to $24,539,375 or 3.98% of the Fund’s net assets as of December 31, 2010. The aggregate value of restricted securities in Davis Financial Fund amounted to $40,657,751 or 6.88% of the Fund’s net assets as of December 31, 2010.

Information regarding restricted securities is as follows:

Fund	Security	Acquisition Date	Shares/Units	Cost per Share/Unit		Valuation per Share/Unit as of December 31, 2010
Davis Opportunity
Fund	Oaktree Capital Group LLC, Class A	05/21/07	691,250	$	27.43	$	35.50

Davis Financial
Fund	Oaktree Capital Group LLC, Class A	05/21/07	972,000	$	21.03	$	35.50

Davis Financial
Fund	RHJ International, 144A	06/04/07	396,550	$	19.64	$	8.32

Davis Financial
Fund	SKBHC Holdings LLC	11/08/10	878	$	5,000.00	$	3,250.00

DAVIS SERIES, INC.	Notes to Financial Statements – (Continued)
	December 31, 2010

NOTE 9 - IN-KIND REDEMPTION

During the year ended December 31, 2010, Davis Financial Fund Class A shareholders redeemed 2,565,515 shares in exchange for portfolio securities valued at $80,121,022. Davis Financial Fund realized a gain of $32,752,484.

During the year ended December 31, 2010, Davis Appreciation & Income Fund Class Y shareholders redeemed 863,798 shares in exchange for portfolio securities valued at $21,232,149. Davis Appreciation & Income Fund realized a gain of $2,364,890.

These gains are not taxable to the Funds for federal income tax purposes.

DAVIS SERIES, INC.

The following financial information represents selected data for each share of capital stock outstanding throughout each period:

Income (Loss) from Investment Operations
	Net Asset Value, Beginning of Period	Net Investment Income (Loss)	Net Realized and Unrealized Gains (Losses)	Total from Investment Operations
Davis Opportunity Fund Class A:
Year ended December 31, 2010	$20.08	$0.24d	$2.54	$2.78
Year ended December 31, 2009	$13.92	$0.09d	$6.15	$6.24
Year ended December 31, 2008	$25.19	$0.09d	$(11.35)	$(11.26)
Year ended December 31, 2007	$27.52	$0.05d	$(0.43)	$(0.38)
Year ended December 31, 2006	$24.29	$–d,e	$4.25	$4.25
Davis Opportunity Fund Class B:
Year ended December 31, 2010	$17.21	$0.05d	$2.17	$2.22
Year ended December 31, 2009	$12.00	$(0.05)d	$5.26	$5.21
Year ended December 31, 2008	$21.89	$(0.07)d	$(9.82)	$(9.89)
Year ended December 31, 2007	$24.17	$(0.15)d	$(0.36)	$(0.51)
Year ended December 31, 2006	$21.44	$(0.18)d	$3.72	$3.54
Davis Opportunity Fund Class C:
Year ended December 31, 2010	$18.10	$0.07d	$2.29	$2.36
Year ended December 31, 2009	$12.60	$(0.03)d	$5.53	$5.50
Year ended December 31, 2008	$22.97	$(0.05)d	$(10.32)	$(10.37)
Year ended December 31, 2007	$25.27	$(0.15)d	$(0.38)	$(0.53)
Year ended December 31, 2006	$22.37	$(0.18)d	$3.90	$3.72
Davis Opportunity Fund Class Y:
Year ended December 31, 2010	$20.65	$0.30d	$2.63	$2.93
Year ended December 31, 2009	$14.31	$0.15d	$6.33	$6.48
Year ended December 31, 2008	$25.94	$0.17d	$(11.73)	$(11.56)
Year ended December 31, 2007	$28.29	$0.13d	$(0.44)	$(0.31)
Year ended December 31, 2006	$24.95	$0.07d	$4.37	$4.44
Davis Government Bond Fund Class A:
Year ended December 31, 2010	$5.66	$0.15	$(0.04)	$0.11
Year ended December 31, 2009	$5.65	$0.18	$0.01	$0.19
Year ended December 31, 2008	$5.60	$0.19	$0.05	$0.24
Year ended December 31, 2007	$5.52	$0.21	$0.08	$0.29
Year ended December 31, 2006	$5.50	$0.18	$0.02	$0.20
Davis Government Bond Fund Class B:
Year ended December 31, 2010	$5.65	$0.10	$(0.05)	$0.05
Year ended December 31, 2009	$5.64	$0.13	$0.01	$0.14
Year ended December 31, 2008	$5.58	$0.15	$0.06	$0.21
Year ended December 31, 2007	$5.51	$0.17	$0.07	$0.24
Year ended December 31, 2006	$5.49	$0.14	$0.02	$0.16
Davis Government Bond Fund Class C:
Year ended December 31, 2010	$5.66	$0.10	$(0.04)	$0.06
Year ended December 31, 2009	$5.65	$0.13	$0.01	$0.14
Year ended December 31, 2008	$5.60	$0.15	$0.05	$0.20
Year ended December 31, 2007	$5.52	$0.17	$0.08	$0.25
Year ended December 31, 2006	$5.51	$0.14	$0.01	$0.15

Financial Highlights

Dividends and Distributions Ratios to Average Net Assets

Dividends from Net Investment Income	Distributions from Realized Gains	Return of Capital	Total Distributions	Net Asset Value, End of Period	Total Returna	Net Assets, End of Period (in thousands)	Gross Expense Ratio	Net Expense Ratiob	Net Investment Income (Loss) Ratio	Portfolio Turnoverc

$(0.29)	$–	$–	$(0.29)	$22.57	13.92%h	$296,880	1.05%	1.05%	1.18%	24%
$(0.08)	$–	$–	$(0.08)	$20.08	44.81%	$319,877	1.17%	1.17%	0.56%	24%
$–	$–	$(0.01)	$(0.01)	$13.92	(44.71)%	$266,525	1.15%	1.15%	0.47%	29%
$(0.18)	$(1.77)	$–	$(1.95)	$25.19	(1.42)%	$676,995	1.06%	1.06%	0.16%	37%
$(0.23)	$(0.79)	$–	$(1.02)	$27.52	17.59%	$680,181	1.10%	1.10%	(0.02)%	40%

$(0.09)	$–	$–	$(0.09)	$19.34	12.91%h	$19,593	1.99%	1.99%	0.24%	24%
$–	$–	$–	$–	$17.21	43.42%	$23,525	2.11%	2.11%	(0.38)%	24%
$–	$–	$–	$–	$12.00	(45.18)%	$21,951	2.00%	2.00%	(0.38)%	29%
$–	$(1.77)	$–	$(1.77)	$21.89	(2.15)%	$60,386	1.85%	1.85%	(0.63)%	37%
$(0.02)	$(0.79)	$–	$(0.81)	$24.17	16.60%	$81,788	1.88%	1.88%	(0.80)%	40%

$(0.12)	$–	$–	$(0.12)	$20.34	13.06%h	$116,235	1.84%	1.84%	0.39%	24%
$–	$–	$–	$–	$18.10	43.65%	$131,972	1.96%	1.96%	(0.23)%	24%
$–	$–	$–	$–	$12.60	(45.15)%	$119,676	1.91%	1.91%	(0.29)%	29%
$–	$(1.77)	$–	$(1.77)	$22.97	(2.14)%	$287,054	1.81%	1.81%	(0.59)%	37%
$(0.03)	$(0.79)	$–	$(0.82)	$25.27	16.70%	$260,254	1.84%	1.84%	(0.76)%	40%

$(0.36)	$–	$–	$(0.36)	$23.22	14.31%h	$183,554	0.75%	0.75%	1.48%	24%
$(0.14)	$–	$–	$(0.14)	$20.65	45.31%	$78,231	0.81%	0.81%	0.92%	24%
$–	$–	$(0.07)	$(0.07)	$14.31	(44.54)%	$42,119	0.85%	0.85%	0.77%	29%
$(0.27)	$(1.77)	$–	$(2.04)	$25.94	(1.13)%	$78,537	0.78%	0.78%	0.44%	37%
$(0.31)	$(0.79)	$–	$(1.10)	$28.29	17.91%	$68,591	0.81%	0.81%	0.27%	40%

$(0.15)	$–	$–	$(0.15)	$5.62	1.95%	$112,118	0.75%	0.75%	2.00%	33%
$(0.18)	$–	$–	$(0.18)	$5.66	3.37%	$100,617	0.72%	0.72%	2.78%	48%
$(0.19)	$–	$–	$(0.19)	$5.65	4.38%	$91,852	0.87%	0.87%	3.29%	67%
$(0.21)	$–	$–	$(0.21)	$5.60	5.45%	$27,224	1.03%	1.03%	3.95%	60%
$(0.18)	$–	$–	$(0.18)	$5.52	3.73%	$22,134	1.05%	1.05%	3.30%	65%

$(0.10)	$–	$–	$(0.10)	$5.60	0.84%	$14,021	1.65%	1.65%	1.10%	33%
$(0.13)	$–	$–	$(0.13)	$5.65	2.42%	$16,322	1.65%	1.65%	1.85%	48%
$(0.15)	$–	$–	$(0.15)	$5.64	3.77%	$16,442	1.69%	1.69%	2.47%	67%
$(0.17)	$–	$–	$(0.17)	$5.58	4.49%	$10,402	1.77%	1.77%	3.21%	60%
$(0.14)	$–	$–	$(0.14)	$5.51	3.02%	$14,058	1.76%	1.76%	2.59%	65%

$(0.10)	$–	$–	$(0.10)	$5.62	1.10%	$34,572	1.56%	1.56%	1.19%	33%
$(0.13)	$–	$–	$(0.13)	$5.66	2.49%	$40,882	1.58%	1.58%	1.92%	48%
$(0.15)	$–	$–	$(0.15)	$5.65	3.63%	$39,261	1.63%	1.63%	2.53%	67%
$(0.17)	$–	$–	$(0.17)	$5.60	4.66%	$14,754	1.75%	1.75%	3.23%	60%
$(0.14)	$–	$–	$(0.14)	$5.52	2.78%	$7,483	1.79%	1.79%	2.56%	65%

DAVIS SERIES, INC.

The following financial information represents selected data for each share of capital stock outstanding throughout each period:

Income (Loss) from Investment Operations
	Net Asset Value, Beginning of Period	Net Investment Income (Loss)	Net Realized and Unrealized Gains (Losses)	Total from Investment Operations
Davis Government Bond Fund Class Y:
Year ended December 31, 2010	$5.70	$0.16	$(0.04)	$0.12
Year ended December 31, 2009	$5.69	$0.18	$0.01	$0.19
Year ended December 31, 2008	$5.64	$0.20	$0.05	$0.25
Year ended December 31, 2007	$5.57	$0.22	$0.07	$0.29
Year ended December 31, 2006	$5.55	$0.19	$0.02	$0.21
Davis Government Money Market Fund Class A, B, C, & Y:
Year ended December 31, 2010	$1.000	$–f	$–	$–f
Year ended December 31, 2009	$1.000	$0.003	$–	$0.003
Year ended December 31, 2008	$1.000	$0.022	$–	$0.022
Year ended December 31, 2007	$1.000	$0.046	$–	$0.046
Year ended December 31, 2006	$1.000	$0.044	$–	$0.044
Davis Financial Fund Class A:
Year ended December 31, 2010	$28.76	$0.23d	$3.00	$3.23
Year ended December 31, 2009	$19.72	$0.12d	$8.96	$9.08
Year ended December 31, 2008	$40.71	$0.16d	$(19.02)	$(18.86)
Year ended December 31, 2007	$47.48	$0.20	$(2.56)	$(2.36)
Year ended December 31, 2006	$42.40	$0.04	$7.81	$7.85
Davis Financial Fund Class B:
Year ended December 31, 2010	$24.79	$(0.08)d	$2.56	$2.48
Year ended December 31, 2009	$17.17	$(0.11)d	$7.73	$7.62
Year ended December 31, 2008	$36.03	$(0.14)d	$(16.75)	$(16.89)
Year ended December 31, 2007	$42.82	$(0.20)d	$(2.28)	$(2.48)
Year ended December 31, 2006	$38.83	$(0.33)d	$7.09	$6.76
Davis Financial Fund Class C:
Year ended December 31, 2010	$25.44	$(0.03)d	$2.64	$2.61
Year ended December 31, 2009	$17.58	$(0.08)d	$7.94	$7.86
Year ended December 31, 2008	$36.77	$(0.11)d	$(17.11)	$(17.22)
Year ended December 31, 2007	$43.58	$(0.18)d	$(2.32)	$(2.50)
Year ended December 31, 2006	$39.46	$(0.32)d	$7.21	$6.89
Davis Financial Fund Class Y:
Year ended December 31, 2010	$29.40	$0.25d	$3.09	$3.34
Year ended December 31, 2009	$20.16	$0.14d	$9.16	$9.30
Year ended December 31, 2008	$41.57	$0.20d	$(19.44)	$(19.24)
Year ended December 31, 2007	$48.38	$0.28	$(2.61)	$(2.33)
Year ended December 31, 2006	$43.10	$0.11	$7.94	$8.05
Davis Appreciation & Income Fund Class A:
Year ended December 31, 2010	$23.70	$0.40d	$4.38	$4.78
Year ended December 31, 2009	$16.15	$0.38d	$7.58	$7.96
Year ended December 31, 2008	$28.21	$0.54d	$(12.06)	$(11.52)
Year ended December 31, 2007	$29.71	$0.61	$(0.18)	$0.43
Year ended December 31, 2006	$27.94	$0.68	$3.52	$4.20

Financial Highlights – (Continued)

Dividends and Distributions							Ratios to Average Net Assets
Dividends from Net Investment Income	Distributions from Realized Gains	Return of Capital	Total Distributions	Net Asset Value, End of Period	Total Returna	Net Assets, End of Period (in thousands)	Gross Expense Ratio	Net Expense Ratiob	Net Investment Income (Loss) Ratio	Portfolio Turnoverc

$(0.16)	$–	$–	$(0.16)	$5.66	2.11%	$3,416	0.58%	0.58%	2.17%	33%
$(0.18)	$–	$–	$(0.18)	$5.70	3.44%	$3,032	0.64%	0.64%	2.86%	48%
$(0.20)	$–	$–	$(0.20)	$5.69	4.43%	$1,626	0.82%	0.82%	3.34%	67%
$(0.22)	$–	$–	$(0.22)	$5.64	5.32%	$410	0.99%	0.99%	3.99%	60%
$(0.19)	$–	$–	$(0.19)	$5.57	3.86%	$302	0.93%	0.93%	3.42%	65%

$–f	$–	$–	$–f	$1.000	0.02%	$320,687	0.61%	0.21%	0.02%	NA
$(0.003)	$–	$–	$(0.003)	$1.000	0.28%	$299,642	0.63%	0.47%	0.30%	NA
$(0.022)	$–	$–	$(0.022)	$1.000	2.26%	$395,211	0.57%	0.57%	2.30%	NA
$(0.046)	$–	$–	$(0.046)	$1.000	4.69%	$596,446	0.55%	0.55%	4.59%	NA
$(0.044)	$–	$–	$(0.044)	$1.000	4.47%	$558,107	0.56%	0.56%	4.41%	NA

$(0.23)	$–	$–	$(0.23)	$31.76	11.25%	$487,948	0.95%	0.95%	0.79%	2%
$(0.04)	$–	$–	$(0.04)	$28.76	46.02%g	$584,626	1.05%	1.05%	0.51%	9%
$(0.16)	$(1.97)	$–	$(2.13)	$19.72	(45.62)%	$425,854	1.06%	1.06%	0.50%	9%
$(0.10)	$(4.31)	$–	$(4.41)	$40.71	(5.31)%	$740,235	0.97%	0.97%	0.44%	15%
$–	$(2.77)	$–	$(2.77)	$47.48	18.74%	$818,054	0.98%	0.98%	0.09%	4%

$–	$–	$–	$–	$27.27	10.00%	$11,103	2.07%	2.07%	(0.33)%	2%
$–	$–	$–	$–	$24.79	44.38%g	$14,397	2.19%	2.19%	(0.63)%	9%
$–	$(1.97)	$–	$(1.97)	$17.17	(46.13)%	$14,236	2.08%	2.08%	(0.52)%	9%
$–	$(4.31)	$–	$(4.31)	$36.03	(6.17)%	$50,341	1.87%	1.87%	(0.46)%	15%
$–	$(2.77)	$–	$(2.77)	$42.82	17.65%	$95,545	1.88%	1.88%	(0.81)%	4%

$–	$–	$–	$–	$28.05	10.26%	$70,964	1.86%	1.86%	(0.12)%	2%
$–	$–	$–	$–	$25.44	44.71%g	$74,530	1.95%	1.95%	(0.39)%	9%
$–	$(1.97)	$–	$(1.97)	$17.58	(46.09)%	$58,474	1.94%	1.94%	(0.38)%	9%
$–	$(4.31)	$–	$(4.31)	$36.77	(6.10)%	$87,216	1.83%	1.83%	(0.42)%	15%
$–	$(2.77)	$–	$(2.77)	$43.58	17.70%	$96,478	1.85%	1.85%	(0.78)%	4%

$(0.26)	$–	$–	$(0.26)	$32.48	11.37%	$20,989	0.86%	0.86%	0.88%	2%
$(0.06)	$–	$–	$(0.06)	$29.40	46.13%g	$15,478	0.95%	0.95%	0.61%	9%
$(0.20)	$(1.97)	$–	$(2.17)	$20.16	(45.56)%	$8,958	0.97%	0.97%	0.59%	9%
$(0.17)	$(4.31)	$–	$(4.48)	$41.57	(5.15)%	$8,844	0.84%	0.84%	0.57%	15%
$–	$(2.77)	$–	$(2.77)	$48.38	18.90%	$10,566	0.84%	0.84%	0.23%	4%

$(0.40)	$–	$–	$(0.40)	$28.08	20.34%	$317,324	0.94%	0.94%	1.58%	20%
$(0.41)	$–	$–	$(0.41)	$23.70	49.68%	$275,411	1.06%	1.06%	1.98%	15%
$(0.54)	$–	$–	$(0.54)	$16.15	(41.43)%	$227,940	1.07%	1.07%	2.24%	28%
$(0.60)	$(1.33)	$–	$(1.93)	$28.21	1.30%	$567,728	1.01%	1.01%	2.04%	23%
$(0.64)	$(1.79)	$–	$(2.43)	$29.71	15.19%	$393,888	1.06%	1.06%	2.35%	25%

DAVIS SERIES, INC.

The following financial information represents selected data for each share of capital stock outstanding throughout each period:

Income (Loss) from Investment Operations
		Net Asset Value, Beginning of Period	Net Investment Income (Loss)	Net Realized and Unrealized Gains (Losses)	Total from Investment Operations
Davis Appreciation & Income Fund Class B:
Year ended December 31, 2010		$23.44	$0.16d	$4.35	$4.51
Year ended December 31, 2009		$15.98	$0.20d	$7.49	$7.69
Year ended December 31, 2008		$27.90	$0.33d	$(11.92)	$(11.59)
Year ended December 31, 2007		$29.40	$0.38d	$(0.21)	$0.17
Year ended December 31, 2006		$27.67	$0.45d	$3.46	$3.91
Davis Appreciation & Income Fund Class C:
Year ended December 31, 2010		$23.81	$0.19d	$4.42	$4.61
Year ended December 31, 2009		$16.24	$0.23d	$7.59	$7.82
Year ended December 31, 2008		$28.34	$0.35d	$(12.10)	$(11.75)
Year ended December 31, 2007		$29.84	$0.38d	$(0.20)	$0.18
Year ended December 31, 2006		$28.06	$0.45d	$3.51	$3.96
Davis Appreciation & Income Fund Class Y:
Year ended December 31, 2010		$23.80	$0.44d	$4.43	$4.87
Year ended December 31, 2009		$16.22	$0.44d	$7.60	$8.04
Year ended December 31, 2008		$28.33	$0.61d	$(12.11)	$(11.50)
Year ended December 31, 2007		$29.84	$0.72d	$(0.22)	$0.50
Year ended December 31, 2006		$28.05	$0.76	$3.54	$4.30
Davis Real Estate Fund Class A:
Year ended December 31, 2010		$19.79	$0.30d	$3.65	$3.95
Year ended December 31, 2009		$15.29	$0.39d	$4.35	$4.74
Year ended December 31, 2008		$30.50	$0.42d	$(14.70)	$(14.28)
Year ended December 31, 2007		$46.42	$0.81d	$(7.45)	$(6.64)
Year ended December 31, 2006		$40.23	$0.61d	$13.28	$13.89
Davis Real Estate Fund Class B:
Year ended December 31, 2010		$19.55	$0.08d	$3.57	$3.65
Year ended December 31, 2009		$15.13	$0.22d	$4.32	$4.54
Year ended December 31, 2008		$30.29	$0.21d	$(14.63)	$(14.42)
Year ended December 31, 2007		$46.16	$0.53d	$(7.46)	$(6.93)
Year ended December 31, 2006		$40.05	$0.38d	$13.07	$13.45
Davis Real Estate Fund Class C:
Year ended December 31, 2010		$19.80	$0.12d	$3.64	$3.76
Year ended December 31, 2009		$15.32	$0.27d	$4.36	$4.63
Year ended December 31, 2008		$30.63	$0.24d	$(14.79)	$(14.55)
Year ended December 31, 2007		$46.56	$0.52d	$(7.50)	$(6.98)
Year ended December 31, 2006		$40.35	$0.44d	$13.12	$13.56
Davis Real Estate Fund Class Y:
Year ended December 31, 2010		$20.05	$0.33d	$3.75	$4.08
Year ended December 31, 2009		$15.46	$0.46d	$4.41	$4.87
Year ended December 31, 2008		$30.82	$0.50d	$(14.85)	$(14.35)
Year ended December 31, 2007		$46.81	$0.92d	$(7.47)	$(6.55)
Year ended December 31, 2006		$40.53	$0.77	$13.37	$14.14
a	Assumes hypothetical initial investment on the business day before the first day of the fiscal period, with all dividends and distributions reinvested in additional shares on the reinvestment date, and redemption at the net asset value calculated on the last business day of the fiscal period. Sales charges are not reflected in the total returns.
b	The ratios in this column reflect the impact, if any, of the reduction of expenses paid indirectly and of certain reimbursements and/or waivers from the Adviser.
c	The lesser of purchases or sales of portfolio securities for a period, divided by the monthly average of the market value of portfolio securities owned during the period. Securities with a maturity or expiration date at the time of acquisition of one year or less are excluded from the calculation.
d	Per share calculations were based on average shares outstanding for the period.

Financial Highlights – (Continued)

Dividends and Distributions							Ratios to Average Net Assets
Dividends from Net Investment Income	Distributions from Realized Gains	Return of Capital	Total Distributions	Net Asset Value, End of Period	Total Returna	Net Assets, End of Period (in thousands)	Gross Expense Ratio	Net Expense Ratiob	Net Investment Income (Loss) Ratio	Portfolio Turnoverc

$(0.17)	$–	$–	$(0.17)	$27.78	19.31%	$18,850	1.85%	1.85%	0.67%	20%
$(0.23)	$–	$–	$(0.23)	$23.44	48.28%	$19,801	1.99%	1.99%	1.05%	15%
$(0.33)	$–	$–	$(0.33)	$15.98	(41.92)%	$16,891	1.93%	1.93%	1.38%	28%
$(0.34)	$(1.33)	$–	$(1.67)	$27.90	0.46%	$44,099	1.84%	1.84%	1.21%	23%
$(0.39)	$(1.79)	$–	$(2.18)	$29.40	14.20%	$51,102	1.89%	1.89%	1.52%	25%

$(0.20)	$–	$–	$(0.20)	$28.22	19.43%	$85,427	1.76%	1.76%	0.76%	20%
$(0.25)	$–	$–	$(0.25)	$23.81	48.36%	$87,739	1.89%	1.89%	1.15%	15%
$(0.35)	$–	$–	$(0.35)	$16.24	(41.85)%	$79,699	1.87%	1.87%	1.44%	28%
$(0.35)	$(1.33)	$–	$(1.68)	$28.34	0.50%	$169,456	1.80%	1.80%	1.25%	23%
$(0.39)	$(1.79)	$–	$(2.18)	$29.84	14.22%	$90,692	1.88%	1.87%	1.54%	25%

$(0.46)	$–	$–	$(0.46)	$28.21	20.66%	$30,878	0.73%	0.73%	1.79%	20%
$(0.46)	$–	$–	$(0.46)	$23.80	50.05%	$46,112	0.80%	0.80%	2.24%	15%
$(0.61)	$–	$–	$(0.61)	$16.22	(41.25)%	$49,314	0.79%	0.79%	2.52%	28%
$(0.68)	$(1.33)	$–	$(2.01)	$28.33	1.55%	$105,327	0.75%	0.74%	2.31%	23%
$(0.72)	$(1.79)	$–	$(2.51)	$29.84	15.49%	$50,052	0.80%	0.80%	2.61%	25%

$(0.36)	$–	$–	$(0.36)	$23.38	20.09%	$246,372	1.11%	1.11%	1.36%	43%
$(0.24)	$–	$–	$(0.24)	$19.79	31.72%	$233,995	1.35%	1.35%	2.55%	64%
$(0.09)	$(0.51)	$(0.33)	$(0.93)	$15.29	(46.89)%	$202,878	1.23%	1.23%	1.62%	44%
$(0.58)	$(8.70)	$–	$(9.28)	$30.50	(14.87)%	$460,644	1.08%	1.08%	1.84%	46%
$(0.88)	$(6.82)	$–	$(7.70)	$46.42	34.58%	$573,375	1.09%	1.09%	1.37%	38%

$(0.12)	$–	$–	$(0.12)	$23.08	18.73%	$5,645	2.20%	2.20%	0.27%	43%
$(0.12)	$–	$–	$(0.12)	$19.55	30.38%	$6,616	2.46%	2.46%	1.44%	64%
$(0.05)	$(0.51)	$(0.18)	$(0.74)	$15.13	(47.41)%	$7,581	2.13%	2.13%	0.72%	44%
$(0.24)	$(8.70)	$–	$(8.94)	$30.29	(15.52)%	$24,872	1.87%	1.87%	1.05%	46%
$(0.52)	$(6.82)	$–	$(7.34)	$46.16	33.50%	$55,347	1.86%	1.86%	0.60%	38%

$(0.18)	$–	$–	$(0.18)	$23.38	19.07%	$30,034	1.92%	1.92%	0.55%	43%
$(0.15)	$–	$–	$(0.15)	$19.80	30.70%	$29,222	2.18%	2.18%	1.72%	64%
$(0.05)	$(0.51)	$(0.20)	$(0.76)	$15.32	(47.33)%	$28,789	2.00%	2.00%	0.85%	44%
$(0.25)	$(8.70)	$–	$(8.95)	$30.63	(15.48)%	$73,594	1.84%	1.84%	1.08%	46%
$(0.53)	$(6.82)	$–	$(7.35)	$46.56	33.54%	$119,093	1.84%	1.84%	0.62%	38%

$(0.44)	$–	$–	$(0.44)	$23.69	20.52%	$18,498	0.77%	0.77%	1.70%	43%
$(0.28)	$–	$–	$(0.28)	$20.05	32.37%	$25,947	0.92%	0.92%	2.98%	64%
$(0.10)	$(0.51)	$(0.40)	$(1.01)	$15.46	(46.75)%	$29,282	0.89%	0.89%	1.96%	44%
$(0.74)	$(8.70)	$–	$(9.44)	$30.82	(14.58)%	$57,995	0.75%	0.75%	2.17%	46%
$(1.04)	$(6.82)	$–	$(7.86)	$46.81	34.98%	$113,856	0.74%	0.74%	1.72%	38%

e	Less than $0.005 per share.
f	Less than $0.0005 per share.
g	Davis Financial Fund received a favorable class action settlement from a company that it no longer owns. This settlement had a material impact on the investment performance, adding approximately 1% to the Fund's total return in 2009. This was a one-time event that is unlikely to be repeated.
h	Davis Opportunity Fund made a favorable investment in an initial public offering (IPO), which had a material impact on the investment performance, adding approximately 2% to the Fund's total return in 2010. The rapid appreciation was an unusual occurrence and such performance may not continue in the future.

See Notes to Financial Statements

DAVIS SERIES, INC.

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Directors

of Davis Series, Inc.:

We have audited the accompanying statements of assets and liabilities of Davis Opportunity Fund, Davis Government Bond Fund, Davis Government Money Market Fund, Davis Financial Fund, Davis Appreciation & Income Fund, and Davis Real Estate Fund (comprising the Davis Series, Inc.), including the schedules of investments, as of December 31, 2010, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years in the five-year period then ended. These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of December 31, 2010, by correspondence with the custodian and brokers or by other appropriate auditing procedures where replies from brokers were not received. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Davis Opportunity Fund, Davis Government Bond Fund, Davis Government Money Market Fund, Davis Financial Fund, Davis Appreciation & Income Fund, and Davis Real Estate Fund as of December 31, 2010, the results of their operations for the year then ended, the changes in their net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years in the five-year period then ended, in conformity with U.S. generally accepted accounting principles.

KPMG LLP

Denver, Colorado

February 22, 2011

DAVIS SERIES, INC.

Fund Information

Federal Income Tax Information (Unaudited)

In early 2011, shareholders will receive information regarding all dividends and distributions paid to them by the Funds during the calendar year 2010. Regulations of the U.S. Treasury Department require the Funds to report this information to the Internal Revenue Service.

The information and distributions reported herein may differ from the information reported as distributions taxable to certain shareholders for the calendar year 2010 with their 2010 Form 1099-DIV.

The information is presented to assist shareholders in reporting distributions received from the Funds to the Internal Revenue Service. Because of the complexity of the federal regulations that may affect your individual tax return and the many variations in state and local regulations, we recommend that you consult your tax adviser for specific guidance.

Each Fund designates the following amounts distributed during the calendar year ended December 31, 2010, as dividends eligible for the corporate dividends-received deduction and qualified dividend income.

			Davis Opportunity Fund		Davis Government Bond Fund		Davis Government Money Market Fund		Davis Financial Fund		Davis Appreciation & Income Fund		Davis Real Estate Fund
PROPOSAL Election of Directors

	Marc Blum
		For		370,851,515		147,667,652		242,573,494		437,351,500		339,322,494		250,855,542
		Withheld		9,639,376		1,947,539		1,100,236		4,540,638		12,908,773		4,567,010
	Christopher Davis
		For		369,600,849		147,862,146		242,577,176		438,175,788		338,926,848		250,176,172
		Withheld		10,890,042		1,753,045		1,096,554		3,716,350		13,304,419		5,246,380
	Andrew Davis
		For		369,589,771		147,900,348		242,577,176		438,230,389		339,087,031		250,177,436
		Withheld		10,901,120		1,714,843		1,096,554		3,661,749		13,144,236		5,245,116
	John Gates Jr.
		For		370,515,849		147,801,928		242,600,313		437,665,214		339,853,738		250,676,744
		Withheld		9,975,042		1,813,263		1,073,417		4,226,924		12,377,529		4,745,808
	Thomas Gayner
		For		370,555,275		147,801,928		242,608,880		437,817,581		339,684,298		250,937,252
		Withheld		9,935,616		1,813,263		1,064,850		4,074,557		12,546,969		4,485,300
	G. Bernard Hamilton
		For		370,385,776		147,783,331		242,574,160		437,436,876		339,065,043		250,792,402
		Withheld		10,105,115		1,831,860		1,099,570		4,455,262		13,166,224		4,630,150
	Samuel Iapalucci
		For		370,656,647		145,474,090		242,585,155		437,379,440		339,283,291		250,618,437
		Withheld		9,834,244		4,141,101		1,088,575		4,512,698		12,947,976		4,804,115
	Robert Morgenthau
		For		370,771,196		147,612,151		242,525,323		437,584,629		339,502,250		250,843,392
		Withheld		9,719,695		2,003,040		1,148,407		4,307,509		12,729,017		4,579,160
	Christian Sonne
		For		370,598,394		147,714,208		242,553,100		437,445,678		338,296,842		250,660,038
		Withheld		9,892,497		1,900,983		1,120,630		4,446,460		13,934,425		4,762,514
	Marsha Williams
		For		370,636,503		147,713,618		242,587,820		437,622,037		338,994,543		250,653,737
		Withheld		9,854,388		1,901,573		1,085,910		4,270,101		13,236,724		4,768,815

Name (birthdate)	Position(s) Held With Fund	Term of Office and Length of Time Served	Principal Occupation(s) During Past Five Years	Number of Portfolios in Fund Complex Overseen by Director	Other Directorships Held by Director


Marc P. Blum (09/09/42)	Director	Director since 1986	Chief Executive Officer, World Total Return Fund, LLLP; of Counsel to Gordon, Feinblatt, Rothman, Hoffberger and Hollander, LLC (law firm).	13	Director, Legg Mason Investment Counsel & Trust Company N.A. (asset management company) and Rodney Trust Company (Delaware).

John S. Gates, Jr. (08/02/53)	Director	Director since 2007	Chairman and Chief Executive Officer of PortaeCo LLC, a private investment company (beginning in 2006); Co-founder of CenterPoint Properties Trust (REIT); Co-chairman and Chief Executive Officer for 22 years (until 2006).	13	Director, DCT Industrial Trust (REIT); Chairman, Regional Transportation Authority.

Thomas S. Gayner (12/16/61)	Director/ Chairman	Director since 2004	President and Chief Investment Officer, Markel Corporation (insurance company).	13	Director, Washington Post Co. (publishing company); Director, Colfax Corp. (engineering and manufacturer of pumps and fluid handling equipment).

G. Bernard Hamilton (03/18/37)	Director	Director since 1978	Managing General Partner, Avanti Partners, L.P. (investment partnership), retired 2005.	13	none

Samuel H. Iapalucci (07/19/52)	Director	Director since 2006	Former Executive Vice President and Chief Financial Officer, CH2M-HILL Companies, Ltd. (engineering).	13	Director, Trow Global Holdings Inc. (engineering & consulting).

Robert P. Morgenthau (03/22/57)	Director	Director since 2002	Chairman, NorthRoad Capital Management, LLC (investment management firm) since June 2002.	13	none

Christian R. Sonne (05/06/36)	Director (retired 12/31/10)	Director since 1990	General Partner, Tuxedo Park Associates (land holding and development firm).	13	none

Marsha Williams (03/28/51)	Director	Director since 1999	Former Senior Vice President and Chief Financial Officer, Orbitz Worldwide, Inc. (travel-services provider) 2007-2010; former Executive Vice President and Chief Financial Officer, Equity Office Properties Trust (REIT).	13	Director, Modine Manufacturing, Inc. (heat transfer technology); Director, Chicago Bridge & Iron Company, N.V. (industrial construction and engineering); Director, Fifth Third Bancorp (diversified financial services).


Andrew A. Davis (06/25/63)	Director	Director since 1997	President or Vice President of each Davis Fund and Selected Fund; President, Davis Selected Advisers, L.P., and also serves as an executive officer in certain companies affiliated with the Adviser.	16	Director, Selected Funds (consisting of three portfolios) since 1998.

Christopher C. Davis (07/13/65)	Director	Director since 1997	President or Vice President of each Davis Fund, Selected Fund, and Clipper Fund; Chairman, Davis Selected Advisers, L.P., and also serves as an executive officer in certain companies affiliated with the Adviser, including sole member of the Adviser’s general partner, Davis Investments, LLC; Employee of Shelby Cullom Davis & Co. (registered broker/dealer).	16	Director, Selected Funds (consisting of three portfolios) since 1998; Director, Washington Post Co. (publishing company).

Investment Adviser
Davis Selected Advisers, L.P. (Doing business as “Davis Advisors”)
2949 East Elvira Road, Suite 101
Tucson, Arizona 85756
(800) 279-0279

Distributor
Davis Distributors, LLC
2949 East Elvira Road, Suite 101
Tucson, Arizona 85756

Transfer Agent
Boston Financial Data Services, Inc.
c/o The Davis Funds
P.O. Box 8406
Boston, Massachusetts 02266-8406

Overnight Address:
30 Dan Road
Canton, Massachusetts 02021-2809

Custodian
State Street Bank and Trust Co.
One Lincoln Street
Boston, Massachusetts 02111

Counsel
Greenberg Traurig, LLP
77 West Wacker Drive, Suite 3100
Chicago, Illinois 60601

Independent Registered Public Accounting Firm
KPMG LLP
707 Seventeenth Street, Suite 2700
Denver, Colorado 80202