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

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT
OF
REGISTERED MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number: 811-03599

Name of Registrant: The Royce Fund

Address of Registrant: 1414 Avenue of the Americas
New York, NY 10019

Name and address of agent for service:	John E. Denneen, Esquire
	1414 Avenue of the Americas
	New York, NY 10019

Registrant’s telephone number, including area code: (212) 486-1445
Date of fiscal year end: December 31
Date of reporting period: January 1, 2005 - June 30, 2005

Item 1: Reports to Shareholders

		S E M I A N N U A L R E P O R T
		2005
Pennsylvania Mutual Fund Royce Micro-Cap Fund Royce Premier Fund Royce Low-Priced Stock Fund Royce Total Return Fund Royce TrustShares Fund Royce Opportunity Fund Royce Special Equity Fund Royce Select Fund Royce Value Fund Royce Value Plus Fund Royce Technology Value Fund Royce 100 Fund
Royce Discovery Fund Royce Financial Services Fund	TheRoyceFund
Royce Dividend Value Fund www.roycefunds.com	VALUE INVESTING IN SMALL COMPANIES FOR MORE THAN 30 YEARS

THE ROYCE FUNDS SELECTION GUIDE

INVESTMENT UNIVERSE
	For more than 30 years, Royce & Associates has utilized a disciplined value approach to invest in smaller companies. Our universe is comprised of three markets: micro-, small- and mid-cap companies.(Segments representing more than 20% of a Fund’s assets are indicated in the table below. Source: FactSet.) Micro-Cap—Market Caps less than $500 million The micro-cap segment is comprised of approximately 5,800 companies with more than $603 billion in total capitalization. It offers many choices, but faces significant trading difficulties, including limited trading volumes and higher volatility. Small-Cap—Market Caps between $500 million and $2.5 billion The small-cap segment encompasses approximately 1,700 companies with a total capitalization of more than $2.0 trillion. It is more efficient, offering greater trading volumes and narrower bid/ask spreads. Mid-Cap—Market Caps between $2.5 billion and $5 billion The mid-cap segment includes approximately 460 companies with more than $1.6 trillion in total capitalization. It includes companies that generally are more established businesses that attract greater institutional interest and therefore enjoy greater liquidity.
PORTFOLIO APPROACH
	Funds are diversified according to our view of the attendant risks within each portfolio’s investment universe and approach. A Fund investing primarily in micro-caps, for example, will generally hold relatively smaller positions in a larger number of securities, while a small- or mid-cap oriented Fund will typically hold larger positions in a relatively limited number of securities. Diversified A Royce diversified portfolio is one that holds more than 100 securities and whose top positions generally do not exceed 2% of net assets. Limited A Royce limited portfolio is one that either (i) invests in no more than 100 companies, and whose top positions generally exceed 2% of net assets, or (ii) invests primarily in a single sector.
VOLATILITY
	Each Fund’s volatility is measured using Morningstar’s Overall Risk Ratio, which measures variations in a Fund’s monthly returns with an emphasis on downside performance. The Overall Risk Ratio is a weighted combination of a Fund’s three-, five- and 10-year scores, if applicable. Each Fund’s results reflect its score compared against all small-cap objective funds tracked by Morningstar with at least three years of history (395 funds as of 6/30/05). We consider Funds whose results rank in the top third of the category to have relatively low volatility; those in the middle third to have moderate volatility, and those in the bottom third to have high volatility.

CURRENT PORTFOLIO CHARACTERISTICS
		Portfolio Composition (as of 6/30/05) *			Portfolio Approach		Volatility (as of 6/30/05)
	Fund Name	Micro	Small	Mid	Limited	Diversified	Low	Moderate	High
	Pennsylvania Mutual	n	n			n	n
	Royce Micro-Cap	n				n		n
	Royce Premier		n	n	n		n
	Royce Low-Priced Stock	n	n			n		n
	Royce Total Return		n	n		n	n
	Royce TrustShares	n	n		n			n
	Royce Opportunity	n	n			n			n
	Royce Special Equity	n	n		n		n
	Royce Select		n		n			n
	Royce Value		n		n			n
	Royce Value Plus	n	n		n				n
	Royce Technology Value	n	n		n		—	—	—
	Royce 100		n		n		—	—	—
	Royce Discovery	n				n	—	—	—
	Royce Financial Services	n	n	n	n		—	—	—
	Royce Dividend Value		n	n	n		—	—	—
* A larger n indicates where a Fund’s Weighted Average Market Capitalization falls.

TABLE OF CONTENTS

Performance Table	2
Letter to Our Shareholders	3
Performance and Portfolio Reviews:
Pennsylvania Mutual Fund, Royce Micro-Cap Fund, Royce Premier Fund, Royce Low-Priced Stock Fund, Royce Total Return Fund, Royce TrustShares Fund, Royce Opportunity Fund, Royce Special Equity Fund, Royce Select Fund, Royce Value Fund, Royce Value Plus Fund, Royce Technology Value Fund, Royce 100 Fund, Royce Discovery Fund, Royce Financial Services Fund and Royce Dividend Value Fund	4
Schedules of Investments:
Pennsylvania Mutual Fund	20
Royce Micro-Cap Fund	23
Royce Premier Fund	26
Royce Low-Priced Stock Fund	27
Royce Total Return Fund	30
Royce TrustShares Fund	36
Royce Opportunity Fund	38
Royce Special Equity Fund	42
Royce Select Fund	44
Royce Value Fund	45
Royce Value Plus Fund	47
Royce Technology Value Fund	49
Royce 100 Fund	50
Royce Discovery Fund	52
Royce Financial Services Fund	54
Royce Dividend Value Fund	55
Statements of Assets and Liabilities	58
Statements of Changes in Net Assets	62
Statements of Operations	68
Financial Highlights	70
Notes to Financial Statements	76
Understanding Your Fund’s Expenses	82
Notes to Performance and Other Important Information	84
Board Approval of Investment Advisory Agreements	85

		PERFORMANCE TABLE
		AVERAGE ANNUAL TOTAL RETURNS Through June 30, 2005
											10-year/Since
		FUND	Jan-Jun1		1-Year		3-Year		5-Year		Inception (Date)
		Pennsylvania Mutual Fund2	2.56	%	13.94	%	14.91	%	15.60	%	13.88	%
		Royce Micro-Cap Fund2	-3.31		5.12		12.50		13.63		13.65
		Royce Premier Fund2	-0.20		8.53		16.56		14.04		13.32
		Royce Low-Priced Stock Fund	-4.04		3.14		10.31		12.33		15.27
		Royce Total Return Fund2	1.47		12.10		13.09		15.15		14.38
		Royce TrustShares Fund2,3	-5.00		2.39		11.61		9.88		17.47		12/27/95
		Royce Opportunity Fund2	-3.31		6.11		16.33		14.13		17.61		11/19/96
		Royce Special Equity Fund2	-2.29		2.25		11.10		18.74		10.88		5/1/98
		Royce Select Fund3	-2.79		4.13		15.83		13.94		18.22		11/18/98
		Royce Value Fund	2.03		17.64		23.76		n/a		16.88		6/14/01
		Royce Value Plus Fund	-5.39		6.71		23.89		n/a		22.31		6/14/01
		Royce Technology Value Fund	-8.47		-12.86		15.87		n/a		9.32		12/31/01
		Royce 100 Fund	0.29		12.37		n/a		n/a		18.81		6/30/03
		Royce Discovery Fund	-1.41		6.52		n/a		n/a		14.91		10/3/03
		Royce Financial Services Fund	-1.24		12.53		n/a		n/a		8.92		12/31/03
		Royce Dividend Value Fund	-1.24		10.94		n/a		n/a		9.94		5/3/04
		Russell 2000	-1.25		9.45		12.81		5.71		9.91
		1  Not annualized.
		2  All performance, risk and expense information reflects Investment Class results. Shares of the Funds’ Consultant Class, and/or Financial Intermediary Class bear an annual distribution expense that is not borne by or is higher than the Funds’ Investment Class shares.
		3  The one-year results for Royce TrustShares and Select Funds are adjusted to reflect the 2% fee assessed on redemptions of shares held for less than three years.
	Pennsylvania Mutual Fund’s average annual total return for the 30-year period ended 6/30/05 was 15.95%.
		IMPORTANT PERFORMANCE AND RISK INFORMATION
	All performance information in this Report reflects past performance, is presented on a total return basis and reflects the reinvestment of distributions. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Current performance may be higher or lower than performance quoted. Current month-end performance may be obtained at www.roycefunds.com. The Royce Funds invest primarily in securities of small-cap and/or micro-cap companies, which may involve considerably more risk than investments in securities of larger-cap companies (see “Primary Risks for Fund Investors” in the respective prospectus). Please read the prospectus carefully before investing or sending money.
2  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005

LETTER TO OUR SHAREHOLDERS
Dear Shareholder,      In 2005’s first half, large- and small-cap stocks mirrored a performance pattern established in 2004 in which large-cap led during negative return periods, while small-cap drove returns in upswings. The large-cap S&P 500 outperformed the Russell 2000 from January through April, while the small-cap index was ahead in the rally that began after the late April market lows and was still pushing prices upward as of 6/30/05. However, strong performance in the rally could not move the Russell 2000 ahead of the S&P 500 for the year-to-date period ended 6/30/05: The Russell 2000 was down 1.3% versus a decline of 0.8% for the S&P 500, and a greater loss of 5.5% for the Nasdaq Composite.
     In 2003, micro-cap companies enjoyed a terrific year. The following year, high returns came primarily from larger small-cap stocks. No discernible pattern has yet emerged in 2005, as evidenced by The Royce Funds’ mixed year-to-date results. Energy stocks were the clear-cut winners in the small-cap universe through the end of June, though some Royce-managed portfolios with relatively low weightings in the industry, such as Royce Total Return and Financial Services Funds, turned in solid performances just the same. In each of The Royce Funds’ portfolios discussed within, holdings outside the energy industry generally produced modest gains or lost value, though there were a few notable exceptions. As a result, some portfolios struggled a bit in the short and intermediate terms, which can be seen in first-half and one-year returns. Seven of the 16 funds covered in this book beat the Funds’ small-cap benchmark, the Russell 2000, for the year-to-date period ended 6/30/05. Six funds - Pennsylvania Mutual, Royce Total Return, Royce Value, Royce 100, Royce Financial Services and Royce Dividend Value Funds - outperformed the small-cap index for the one-year period as well.
     Results for periods of three years or longer were solid (if not strong) on a relative basis and very strong on an absolute basis. Of the 12 funds with three or more years of history, all had double-digit average annual total returns for the three-year period ended 6/30/05, and eight were ahead of the benchmark for the three-year period ended 6/30/05: The previously mentioned Pennsylvania Mutual, Royce Total Return and Royce Value Funds were joined by Royce Premier, Opportunity, Select, Value Plus and Technology Value Funds (Royce 100, Discovery, Financial Services and Dividend Value Funds did not have three years of history at June 30). All of The Royce Funds with sufficient history beat the Russell 2000 for the five- and 10-year periods ended 6/30/05. The news was good from a market cycle standpoint as well: Each of The Royce Funds then in existence outperformed the small-cap index from its peak on 3/9/00 through 6/30/05.
     We appreciate your continued support.



For more than 30 years, we have used various value approaches to invest in smaller-cap securities. We focus primarily on the quality of a company’s balance sheet, its ability to generate free cash flow and other measures of profitability or sound financial condition. At times, we may also look at other factors, such as a company’s unrecognized asset values, its future growth prospects or its turnaround potential following an earnings disappointment or other business difficulties. We then use these factors to assess the company’s current worth, basing the assessment on either what we believe a knowledgeable buyer might pay to acquire the entire company, or what we think the value of the company should be in the stock market.

Sincerely,

Charles M. Royce
     President

July 31, 2005

THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  3

PENNSYLVANIA MUTUAL FUND†
	AVERAGE ANNUAL TOTAL RETURNS Through 6/30/05						Manager’s Discussion Our flagship fund successfully navigated the rough seas of 2005’s first half. Pennsylvania Mutual Fund (PMF) finished the year-to-date period ended 6/30/05 with a return of 2.6%, ahead of its small-cap benchmark, the Russell 2000, which lost 1.3% for the same period. The Fund managed this feat with a combination of relatively strong quarterly performances, especially on the downside. In the dismal first quarter, PMF was down 0.7% (versus a decline of 5.3% for the Russell 2000), while in the second-quarter uptick the Fund gained 3.3%, trailing the Russell 2000’s 4.3% result. Over long-term and market cycle periods, the news was equally good, with the performance pattern of terrific down market performance and competitive up market returns holding true. PMF significantly outpaced the Russell 2000 from the small-cap market peak on 3/9/00 through 6/30/05, 115.6% versus 13.0%. From the small-cap market trough on 10/9/02 through 6/30/05, PMF was up 99.8%, while its benchmark was up 102.3% The Fund outperformed the Russell 2000 for the one-, three-, five-, 10-, 15-, 20- and 25-year periods ended 6/30/05. PMF’s 30-year average annual total return for the period ended 6/30/05 was 16.0%, a long-term accomplishment that gives us great pride.      As was the case in 2004, gains in the first half of 2005 were dominated by portfolio holdings in Health, which led all the Fund’s sectors on a dollar basis, and Natural Resources. Within Health, two industries suffered losses while three others shined. We took advantage of rising prices by taking gains in healthcare products maker CNS, multiple health-related services provider Horizon Health, and pharmaceutical and nutritional products manufacturer Hi-Tech Pharmacal. We also enjoyed sucess with three top performers in the Natural Resources sector, energy services companies Trican Well Service and Patterson-UTI Energy, and natural gas and oil company, St. Mary Land & Exploration Company. Although the Consumer Products and Technology sectors showed the most significant net losses in the first half, companies both in the red and the black could be found throughout the portfolio. Falling prices led us to increase our position in eFunds Corporation, as it struggled to integrate a new acquisition. Since first buying shares in 2002, we have admired the fundamentals and management of the company, which provides multiple financial services, including risk management, electronic transaction processing and ATM management. We also built our stake in kitchen cabinet and bathroom vanity manufacturer American Woodmark. Includes reinvestment of distributions. † All performance and risk information for PMF reflects Investment Class results. Shares of PMF’s Consultant Class bear an annual distribution expense that is not borne by the Investment Class. All performance information in this Report reflects past performance, is presented on a total return basis and reflects the reinvestment of distributions. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Current performance may be higher or lower than performance quoted. Current month-end performance may be obtained at www.roycefunds.com.
	January - June 2005*				2.56	%
	1-Year				13.94
	3-Year				14.91
	5-Year				15.60
	10-Year				13.88
	20-Year				12.76
	25-Year				14.86
	30-Year				15.95
*	Not annualized.
	CALENDAR YEAR TOTAL RETURNS
	Year	PMF		Year	PMF
	2004	20.2	%	1996	12.8	%
	2003	40.3		1995	18.7
	2002	-9.2		1994	-0.7
	2001	18.4		1993	11.3
	2000	18.4		1992	16.2
	1999	6.0		1991	31.8
	1998	4.2		1990	-11.5
	1997	25.0		1989	16.7
	TOP 10 POSITIONS (% of Net Assets)
	Unit Corporation				1.2	%
	St. Mary Land & Exploration Company				1.2
	Buckle (The)				1.2
	Florida Rock Industries				1.2
	Ensign Energy Services				1.1
	Ethan Allen Interiors				1.0
	Endurance Specialty Holdings				1.0
	Endo Pharmaceuticals Holdings				1.0
	Nu Skin Enterprises Cl. A				1.0
	Trican Well Service				1.0
	PORTFOLIO SECTOR BREAKDOWN % of Net Assets
	Natural Resources				14.0	%
	Consumer Products				13.4
	Technology				11.5
	Health				10.9
	Industrial Products				10.9
	Consumer Services				9.4
	Financial Intermediaries				8.9
	Industrial Services				3.6
	Financial Services				2.7
	Miscellaneous				1.4
	Cash and Cash Equivalents				13.3

4  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005

ROYCE MICRO-CAP FUND†
Manager’s Discussion The last 18 months have not been especially kind to micro-cap companies, an observation unfortunately borne out by the recent performance of Royce Micro-Cap Fund (RMC). The Fund endured an unspectacular first half, down 3.3% for the year-to-date period ended 6/30/05, trailing its small-cap benchmark, the Russell 2000, which lost 1.3% for the same period. The Fund fared relatively well in the bearish first quarter (though “relatively” would be the key word), losing 3.8%, while the Russell 2000 posted a loss of 5.3%. However, in the widespread rally that began on 4/28/05, RMC lost ground, resulting in a diminutive second-quarter return of 0.5%, versus a 4.3% gain for the benchmark. Looking at recent market cycle periods, the picture begins to brighten. The Fund beat its benchmark for the period from the small-cap market peak on 3/9/00 through 6/30/05, up 87.2% versus 13.0%. From the small-cap market trough on 10/9/02 through 6/30/05, RMC was up 102.4%, while its benchmark was up 102.3%. The Fund also held a performance edge over the Russell 2000 for the five-year, 10-year and since inception (12/31/91) periods ended 6/30/05. RMC’s average annual total return since inception was 15.0%.      Losses could be found throughout the portfolio, although as a group the Fund’s Technology holdings suffered most in the first half, especially those in the components and systems industry; within the Health sector, biotech stocks posted the greatest losses on a dollar basis. Positions that lost money can generally be divided into two groups, those whose ongoing decline in value (along with other issues) led us to sell off or greatly reduce our stake and those whose negative results we regard as short-term. Among the latter group we would include biotech firm Lexicon Genetics. The company uses proprietary gene knockout technology to treat disease. We liked both its new business partnerships and its progress toward new treatments enough to hold a good-sized position at June 30. We also increased our stake in Zila as its price slipped. We liked its low debt as well as its nutritional and pharmaceutical products and biotech businesses. We were less sanguine about the long-term prospects for Able Laboratories, especially after the FDA forced a recall of its (mostly prescription) drug line, a move that led us to sell our position in June. Holdings with sizeable gains were clustered mostly in the retail, oil and gas, and energy services industry. We trimmed our position in The Buckle, a casual clothing retailer that focuses on younger people. A stock that we have liked since first buying shares in 1994, the company’s stock price benefited in the first half from strong same-store sales and a robust market for jeans. Includes reinvestment of distributions. †All performance and risk information for RMC reflects Investment Class results. Shares of RMC’s Consultant and Financial Intermediary Classes bear an annual distribution expense that is not borne by the Investment Class. All performance information in this Report reflects past performance, is presented on a total return basis and reflects the reinvestment of distributions. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Current performance may be higher or lower than performance quoted. Current month-end performance may be obtained at www.roycefunds.com.			AVERAGE ANNUAL TOTAL RETURNS Through 6/30/05
			January - June 2005*			-3.31%
			1-Year			5.12
			3-Year			12.50
			5-Year			13.63
			10-Year			13.65
			Since Inception (12/31/91)			15.04
			* Not annualized.
			CALENDAR YEAR TOTAL RETURNS
		Year		RMC	Year	RMC
		2004		15.8%	1997	24.7%
		2003		52.6	1996	15.5
		2002		-13.4	1995	19.1
		2001		23.1	1994	3.6
		2000		16.7	1993	23.7
		1999		13.7	1992	29.4
		1998		-3.3
			TOP 10 POSITIONS (% of Net Assets)
			Exponent			1.3%
			Dawson Geophysical			1.3
			Pason Systems			1.2
			Tesco Corporation			1.2
			Drew Industries			1.2
			Northern Orion Resources			1.1
			Buckle (The)			1.1
			Argonaut Group			1.0
			Gulf Island Fabrication			1.0
			Western Silver			1.0
			PORTFOLIO SECTOR BREAKDOWN % of Net Assets
			Natural Resources			19.2%
			Technology			15.2
			Health			15.0
			Industrial Products			10.9
			Industrial Services			7.8
			Financial Intermediaries			6.1
			Consumer Services			5.7
			Consumer Products			2.8
			Financial Services			1.2
			Miscellaneous			4.7
			Cash and Cash Equivalents			11.4
	THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  5

ROYCE PREMIER FUND†
	AVERAGE ANNUAL TOTAL RETURNS Through 6/30/05						Managers’ Discussion Although the kind of high-quality small-cap securities that we seek for Royce Premier Fund’s (RPR) portfolio came back strong in 2004, their first half results in 2005 were as ho-hum as much of the rest of the market. RPR was down 0.2% for the year-to-date period ended 6/30/05, besting its small-cap benchmark, the Russell 2000, which declined 1.3% during the same period. The Fund slogged through the difficult first quarter with a loss of 2.6%, though this was less than half of what its benchmark gave back with a loss of 5.3%. Yet second-quarter results for the Russell 2000, with its 4.3% return, more fully reflected the recovery in equity prices that began in late April, while RPR turned in a relatively underwhelming 2.4%. The Fund’s returns over recent market cycle and other long-term periods were more notable. From the small-cap market peak on 3/9/00 through 6/30/05, RPR outperformed the Russell 2000, 97.5% versus 13.0%. The Fund was also very competitive from the small-cap market trough on 10/9/02 through 6/30/05. RPR gained 99.2% during this period, narrowly trailing its small-cap benchmark’s return of 102.3%. RPR outperformed the Russell 2000 for the three-, five-, 10-year and since inception (12/31/91) periods ended 6/30/05. The Fund’s average annual total return since inception was 13.6%.      Depressed share prices provided several opportunities to build positions for which we had high regard. Dycom Industries provides contract engineering and construction services for the telecommunications and cable industries. In May, the firm forecasted reduced fiscal fourth-quarter revenues (to end on 7/31/05), which caused its stock to remain mostly underwater through the remainder of the first half. We added to our stake throughout the first half. Sixteen months of negative same-store sales left few investors lining up for home goods retailer Pier 1 Imports. We liked the firm’s plans to turn its business around and thus bought more shares between February and early June. Our confidence extended to air-freight, transportation and supply-chain management business EGL, and to scrap metal and recycling business Schnitzer Steel Industries, both of whose businesses met with what we anticipate will be short-term difficulties. On the plus side, we trimmed our position in top holding, fast-growing Trican Well Service, whose businesses include piping and drilling equipment and oil well completion and maintenance services. We also continued to hold a large stake in Endo Pharmaceuticals Holdings. Its price soared in early June when a federal appeals court upheld an earlier decision that allowed the firm to sell a generic version of the painkiller Oxycontin. Includes reinvestment of distributions. †All performance and risk information for RPR reflects Investment Class results. Shares of RPR’s Consultant and Financial Intermediary Classes bear an annual distribution expense that is not borne by the Investment Class. All performance information in this Report reflects past performance, is presented on a total return basis and reflects the reinvestment of distributions. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Current performance may be higher or lower than performance quoted. Current month-end performance may be obtained at www.roycefunds.com.
	January - June 2005*				-0.20	%
	1-Year				8.53
	3-Year				16.56
	5-Year				14.04
	10-Year				13.32
	Since Inception (12/31/91)				13.64
*	Not annualized.
	CALENDAR YEAR TOTAL RETURNS
	Year	RPR		Year	RPR
	2004	22.8	%	1997	18.4	%
	2003	38.7		1996	18.1
	2002	-7.8		1995	17.8
	2001	9.6		1994	3.3
	2000	17.1		1993	19.0
	1999	11.5		1992	15.8
	1998	6.7
	TOP 10 POSITIONS (% of Net Assets)
	Trican Well Service				3.4	%
	Endo Pharmaceuticals Holdings				3.2
	Ensign Energy Services				3.0
	Lincoln Electric Holdings				2.7
	Nu Skin Enterprises Cl. A				2.7
	Alleghany Corporation				2.7
	IPSCO				2.6
	Simpson Manufacturing				2.5
	Timberland Company Cl. A				2.4
	Glamis Gold				2.4
	PORTFOLIO SECTOR BREAKDOWN % of Net Assets
	Industrial Products				14.8	%
	Natural Resources				14.8
	Technology				12.0
	Consumer Products				11.9
	Financial Intermediaries				8.6
	Health				8.4
	Consumer Services				7.0
	Industrial Services				6.1
	Financial Services				2.5
	Miscellaneous				0.5
	Cash and Cash Equivalents				13.4

6  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005

ROYCE LOW-PRICED STOCK FUND
Manager’s Discussion Robert Frost once mused, “Something there is that doesn’t love a wall.” Maybe it’s the same something that hasn’t loved low-priced stocks over the last three years, as many of them have collectively hit a wall that has held back performance. Royce Low-Priced Stock Fund (RLP) had a disappointing first half, its loss of 4.0% for the year-to-date period ended 6/30/05 putting it behind its small-cap benchmark, the Russell 2000, which was down 1.3% for the same period. RLP made it through the first quarter with modest losses, and its return of -4.6%, though certainly nothing to brag about, was slightly better than the Russell 2000’s decline of 5.3%. Where the Fund lost its way, as it were, was in the stock market rebound that began on 4/28/05. RLP’s inability to participate to a greater degree in the up-market months of May and June led to a second-quarter underperformance versus the benchmark, up 0.6% versus a gain of 4.3% for the Russell 2000. The one grace note in RLP’s recent results was its ongoing strength in longer-term and market cycle periods ended 6/30/05. The Fund impressively outperformed its benchmark from the small-cap market peak on 3/9/00, 93.8% versus 13.0%. RLP was also ahead of the Russell 2000 for the five-year, 10-year and since inception (12/15/93) periods ended 6/30/05. The Fund’s average annual total return for the since inception period ended 6/30/05 was 15.0%.      After leading the small-cap market in 2004, energy stocks again were small-cap’s best performers in 2005’s first half. Oil and gas, and energy services stocks mostly posted terrific results in RLP’s portfolio as well. Unfortunately, their gains were offset by losses in precious metals and mining companies to the degree that the Natural Resources sector as a whole made only a marginal positive contribution to the Fund’s year-to-date returns. We held large stakes in several precious metals and mining businesses at June 30, confident in the long-term prospects for the industry. Among other companies that lost money in the first half, we also held a large position in eFunds Corporation, which provides multiple financial services, including risk management, electronic transaction processing and ATM management, based on our high opinion of its fundamentals and management. In two notable instances, share prices declined to levels that made additional purchases attractive when combined with our regard for each firm’s core business: We built our position in Dycom Industries, which provides contract engineering and construction services for telecommunications and cable companies, and in Insituform Technologies, which uses proprietary technologies to repair, replace, maintain and install underground pipes. Includes reinvestment of distributions. All performance information in this Report reflects past performance, is presented on a total return basis and reflects the reinvestment of distributions. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Current performance may be higher or lower than performance quoted. Current month-end performance may be obtained at www.roycefunds.com.			AVERAGE ANNUAL TOTAL RETURNS Through 6/30/05
			January - June 2005*			-4.04%
			1-Year			3.14
			3-Year			10.31
			5-Year			12.33
			10-Year			15.27
			Since Inception (12/15/93)			15.00
			* Not annualized.
			CALENDAR YEAR TOTAL RETURNS
		Year		RLP	Year	RLP
		2004		13.6%	1998	2.4%
		2003		44.0	1997	19.5
		2002		-16.3	1996	22.8
		2001		25.1	1995	22.5
		2000		24.0	1994	3.0
		1999		29.8
			TOP 10 POSITIONS (% of Net Assets)
			Endo Pharmaceuticals Holdings			2.0%
			Unit Corporation			1.9
			Nu Skin Enterprises Cl. A			1.9
			Ensign Energy Services			1.9
			Meridian Gold			1.9
			Glamis Gold			1.9
			Perot Systems Cl. A			1.7
			IPSCO			1.6
			eFunds Corporation			1.6
			Transaction Systems Architects Cl. A			1.6
			PORTFOLIO SECTOR BREAKDOWN % of Net Assets
			Natural Resources			19.5%
			Technology			17.0
			Health			11.8
			Consumer Services			10.5
			Consumer Products			10.1
			Industrial Products			7.8
			Industrial Services			6.3
			Financial Intermediaries			4.9
			Financial Services			1.6
			Miscellaneous			2.3
			Cash and Cash Equivalents			8.2
	THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  7

ROYCE TOTAL RETURN FUND†
	AVERAGE ANNUAL TOTAL RETURNS Through 6/30/05						Manager’s Discussion Dividend-paying companies may never become the next big trend in investing, but in our admittedly biased opinion, they are classics that never go out of style. Royce Total Return Fund (RTR) gained 1.5% in the year-to-date period ended 6/30/05, outperforming its small-cap benchmark, the Russell 2000, which was down 1.3% for the same period. The Fund’s solid first half was the result of relatively strong performance in the down market of the first quarter (-1.1% versus -5.3% for the Russell 2000) and competitive results in the more bullish second quarter (+2.6 versus +4.3% for the benchmark). RTR’s recent market cycle returns expand on this model of strong down-period returns combined with solid up-market results. From the small-cap market peak on 3/9/00 through 6/30/05, the Fund significantly outpaced the Russell 2000, 115.4% versus 13.0%. RTR trailed the benchmark from the small-cap market trough on 10/9/02 through 6/30/05, though it gained a respectable 76.5% in that time span versus a 102.3% return for the small-cap index. The Fund also outperformed the Russell 2000 for the one-, three-, five-, 10-year and since inception (12/15/93) periods ended 6/30/05. RTR’s average annual total return since inception was 14.1%.      Results for many of the Fund’s industrial-based holdings that helped to elevate performance in 2004 cooled off in the first half of 2005, though there were a few happy exceptions, including the portfolio’s number-one gainer on a dollar basis, Seaboard Corporation, which occupied the same position in 2004. After faltering somewhat during April, the price of this pork processing and shipping business recovered in May, when we took some gains. Energy stocks once again led small-cap performance in the market as a whole and in the Fund. Unfortunately, few other sectors were able to follow. Lufkin Industries, which manufactures oil field, power transmission and trailer products, is a company that we repurchased in RTR’s portfolio back in 1999. Its price rose slowly but steadily from early 2003 before gushing through the end of 2005’s second quarter. As with Seaboard Corporation, we trimmed our position in May. Holdings in the Technology and Consumer Products sectors showed the largest losses on a dollar basis. The share price of gift product and collectibles manufacturer Russ Berrie & Company continued to fall as sales slipped. Nonetheless, we added to our position in the first half because our confidence in the firm’s ability to right itself remained strong. Disappointing earnings over two consecutive quarters have driven investors away from Black Box, a firm that provides various network and wireless services, but we liked its core businesses enough to add to our position in the first half. Includes reinvestment of distributions. †All performance and risk information for RTR reflects Investment Class results. Shares of RTR’s Consultant and Financial Intermediary Classes bear an annual distribution expense that is not borne by the Investment Class. All performance information in this Report reflects past performance, is presented on a total return basis and reflects the reinvestment of distributions. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Current performance may be higher or lower than performance quoted. Current month-end performance may be obtained at www.roycefunds.com.
	January - June 2005*				1.47	%
	1-Year				12.10
	3-Year				13.09
	5-Year				15.15
	10-Year				14.38
	Since Inception (12/15/93)				14.14
*	Not annualized.
	CALENDAR YEAR TOTAL RETURNS
	Year	RTR		Year	RTR
	2004	17.5	%	1998	4.8	%
	2003	30.0		1997	23.7
	2002	-1.6		1996	25.5
	2001	14.8		1995	26.9
	2000	19.4		1994	5.1
	1999	1.6
	TOP 10 POSITIONS (% of Net Assets)
	Canadian Government Bonds				2.0	%
	Alliance Capital Management Holding L.P.				1.2
	Vornado Realty Trust				0.7
	Nuveen Investments Cl. A				0.6
	TSX Group				0.6
	Federated Investors Cl. B				0.6
	CLARCOR				0.6
	Commerce Group				0.6
	Alleghany Corporation				0.6
	Seaboard Corporation				0.5
	PORTFOLIO SECTOR BREAKDOWN % of Net Assets
	Industrial Products				17.9	%
	Financial Intermediaries				14.7
	Industrial Services				9.9
	Natural Resources				9.1
	Financial Services				7.7
	Consumer Products				6.2
	Consumer Services				6.1
	Technology				5.4
	Health				4.4
	Utilities				1.7
	Miscellaneous				2.8
	Bonds and Preferred Stocks				3.5
	Treasuries, Cash and Cash Equivalents				10.6

8  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005

ROYCE TRUSTSHARES FUND†
Manager’s Discussion Too many holdings in Royce TrustShares Fund’s (RTS) limited portfolio of small- and micro-cap stocks have not been in a giving mood over the last several months. The Fund was down 5.0% in 2005’s first half, behind its small-cap benchmark, the Russell 2000, which declined 1.3% for the same period. The Fund’s performance year-to-date through 6/30/05 was disappointing regardless of how it compared to its benchmark. Our dissatisfaction was exacerbated by RTS’s struggles in the first four months of 2005, a bearish period in which we would typically expect to do better. As it happened, the Fund was down 6.9% in the first quarter and gained a relatively paltry 2.0% in the second. (The Russell 2000’s returns for these same periods were -5.3% and +4.3%.) RTS’s recent market cycle performances have fortunately been somewhat stronger than its recent short-term record. The Fund beat its benchmark for the period from the small-cap market peak on 3/9/00 through 6/30/05, up 61.9% versus 13.0%. RTS also gained 88.9% from the small-cap market trough on 10/9/02 through 6/30/05, a period in which the Russell 2000 was up 102.3% The Fund outperformed its benchmark for the five-year and since inception (12/27/95) periods ended 6/30/05. RTS’s average annual total return since inception was 17.5%.      Although holdings in the Technology sector were the leading cause of negative returns, there were losses in all of the Fund’s sectors. Poor performance owed more to a larger number of companies losing money in a down market than it did to exceptionally difficult or catastrophic conditions in a particular sector or industry. In some cases, we added to existing positions, while in others we held on because declining prices did not create compelling bargains. There were also situations that led us to sell positions. In late January, pharmaceutical and specialty chemical distributor Aceto Corporation announced that its earnings would fall below initial expectations, a development that left its stock price tumbling through much of the first half, even following the announcement in May of record quarterly sales. We increased our position between January and April. The share price of aerospace components maker Lowrance Electronics declined in the face of disappointing earnings. We liked the firm’s balance sheet and cash flow enough to hold on to a good-sized stake at June 30. We had a different reaction to the more serious problems of Willbros Group. A long-time holding, the energy services company conducted an internal investigation that led to it restating results for 2002, 2003 and the first three quarters of 2004. We sold our shares in May. Includes reinvestment of distributions. †All performance and risk information for RTS reflects Investment Class results. Shares of the RTS’s Consultant Class bear an annual distribution expense that is higher than that of the Investment Class. All performance information in this Report reflects past performance, is presented on a total return basis and reflects the reinvestment of distributions. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Current performance may be higher or lower than performance quoted. Current month-end performance may be obtained at www.roycefunds.com.			AVERAGE ANNUAL TOTAL RETURNS Through 6/30/05
			January - June 2005*	-5.00%
			1-Year	4.48
			1-Year (net)1	2.39
			3-Year	11.61
			5-Year	9.88
			Since Inception (12/27/95)	17.47
		*	Not annualized.
		1	One-year net results are adjusted to reflect the 2% fee assessed on redemptions of shares held for less than three years.
			CALENDAR YEAR TOTAL RETURNS
			Year	RTS
			2004	20.4%
			2003	38.1
			2002	-18.9
			2001	20.5
			2000	11.7
			1999	41.8
			1998	19.5
			1997	26.0
			1996	25.6
			TOP 10 POSITIONS (% of Net Assets)
			Alliance Capital Management Holding L.P.	3.5%
			Ritchie Bros. Auctioneers	2.3
			E*TRADE Financial	2.0
			Nuveen Investments Cl. A	1.8
			Lincoln Electric Holdings	1.8
			Morningstar	1.8
			Rofin-Sinar Technologies	1.8
			Brown & Brown	1.7
			Aceto Corporation	1.6
			Excel Technology	1.6
			PORTFOLIO SECTOR BREAKDOWN % of Net Assets
			Technology	30.7%
			Industrial Products	18.0
			Financial Services	13.6
			Health	8.7
			Industrial Services	6.8
			Natural Resources	4.3
			Consumer Services	3.6
			Consumer Products	3.5
			Financial Intermediaries	2.0
			Miscellaneous	4.7
			Cash and Cash Equivalents	4.1
	THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  9

ROYCE OPPORTUNITY FUND†
	AVERAGE ANNUAL TOTAL RETURNS Through 6/30/05			Manager’s Discussion As of June 30, a few too many opportunities had not yet turned into profitable ones for Royce Opportunity Fund (ROF) during 2005’s first half. The Fund was down 3.3% for the year-to-date period ended 6/30/05, trailing its small-cap benchmark, the Russell 2000, which lost 1.3% during the same period. Along with most of the stock market, ROF suffered through a tough first quarter, down 4.4% versus a decline of 5.3% for its small-cap benchmark, the Russell 2000. The Fund then rebounded during the rally that began to kickstart share prices on 4/28/05, but its 1.1% return in the second quarter could not overcome its earlier difficulties. Still, the Fund’s recent market cycle and long-term performances were strong. For the periods ended 6/30/05, ROF remained in front of its benchmark from the small-cap market peak on 3/9/00 (+94.8% versus +13.0%) and from the small-cap market trough on 10/9/02 through 6/30/05 (+144.4% versus +102.3%), impressive outperformance in both down and up market periods. The Fund also outpaced the Russell 2000 for the three-year, five-year and since inception (11/19/96) periods ended 6/30/05. ROF’s average annual total return for the since inception period ended 6/30/05 was 17.6%.      In a disappointing short-term performance period such as 2005’s first half, we think it’s important to point out that the Fund is a contrarian portfolio that anticipates each holding going through three stages: First is the investment period in which we build a position because a company’s stock price is depressed. (Stock price depreciation can happen for any number of reasons.) Improvement in the stock price marks the second stage, which most commonly occurs when the business’s earnings begin to improve. When a rising stock price hits our sell targets, the final stage has arrived, and we reduce or sell our position. Of course, stages two and three can take a long time to materialize. We can also think of plenty of examples in which the opposite occurs, and we take our losses and move on. In the first half of 2005, we used numerous opportunities to buy both in the anticipation of, and in response to, poor earnings. Many companies were hit even harder than we would have expected. We found what we thought was solid value in various industries throughout the market. The Fund was underweighted in energy stocks relative to the Russell 2000 in the first half, while also holding a relatively larger share of Technology issues, which was a factor on the Fund’s first-half results. Includes reinvestment of distributions. †All performance and risk information for ROF reflects Investment Class results. Shares of ROF’s Financial Intermediary Class bear an annual distribution expense that is not borne by the Investment Class. All performance information in this Report reflects past performance, is presented on a total return basis and reflects the reinvestment of distributions. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Current performance may be higher or lower than performance quoted. Current month-end performance may be obtained at www.roycefunds.com.
	January - June 2005*	-3.31	%
	1-Year	6.11
	3-Year	16.33
	5-Year	14.13
	Since Inception (11/19/96)	17.61
*	Not annualized.
	CALENDAR YEAR TOTAL RETURNS
	Year	ROF
	2004	17.5	%
	2003	72.9
	2002	-17.0
	2001	17.3
	2000	19.9
	1999	32.3
	1998	4.9
	1997	20.8
	TOP 10 POSITIONS (% of Net Assets)
	Titanium Metals	0.9	%
	Hexcel Corporation	0.9
	McGrath RentCorp	0.9
	Atlas Air Worldwide Holdings	0.8
	Barnes Group	0.8
	Trinity Industries	0.7
	Park Electrochemical	0.7
	Flowserve Corporation	0.7
	CIRCOR International	0.7
	UNOVA	0.7
	PORTFOLIO SECTOR BREAKDOWN % of Net Assets
	Technology	35.5	%
	Industrial Products	28.6
	Industrial Services	7.3
	Consumer Services	6.5
	Consumer Products	3.8
	Health	3.5
	Natural Resources	3.1
	Financial Intermediaries	2.8
	Financial Services	1.2
	Miscellaneous	1.3
	Cash and Cash Equivalents	6.4

10  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005

ROYCE SPECIAL EQUITY FUND†
Manager’s Discussion While we would not go so far as to argue that the recent (and so far short-term) market rally was a bad thing, it did contribute to short-term relative underperformance for Royce Special Equity Fund (RSE). RSE lost 2.3% in 2005’s first half, a result that left it behind its small-cap benchmark, the Russell 2000, which declined 1.3% for the same period. The Fund fared relatively well in the first-quarter downdraft (that actually lasted through late April), down 2.4% versus a loss of 5.3% for the small-cap index. RSE then underperformed in the more dynamic second quarter, up 0.1% versus 4.3% for the Russell 2000. The Fund’s strength historically has not been to thrive during short-term, up-market swings, but instead to lose less, or even gain, during down markets with the end result of strong absolute returns over market cycle and other long-term performance periods. Still, the Fund’s results were disappointing, even though we ultimately do not put much stock in any six-month period, good or bad. Looking over longer-term time spans, RSE’s results were much more encouraging. From the small-cap market peak on 3/9/00 through 6/30/05, the Fund held a significant performance edge over the Russell 2000, up 146.8% versus 13.0%. RSE outperformed its benchmark for the five-year and since inception (5/1/98) periods ended 6/30/05. The Fund’s average annual total return since inception was 10.9%.      One advantage to having managed money for more than 25 years has been the ability to observe a variety of market cycles during which different portfolio managers and/or approaches were out of style. The market zigs while a given manager zags, and vice-versa. This is one reason why we do not trouble ourselves over the Fund’s recent short-term and 12-month performances. RSE’s historical performance patterns show that it has been out of sync with the market more often than not, something that is in large part a product of the Fund’s emphasis on 12-month trailing metrics such as balance sheet quality and returns on invested capital. The Fund’s one-year results were an “off” period, though its market-cycle, five-year and since inception returns remained strong on both an absolute and relative basis. As in 2004, energy stocks were not represented in RSE’s portfolio, and once again, they dominated small-cap performance. In addition, the Fund’s two largest sectors, Industrial Products and Consumer Products, posted net losses. In most cases, we added to existing positions as prices fell. We built our stake in kitchen cabinet and bathroom vanity maker American Woodmark, power equipment and engine manufacturer Briggs & Stratton and plastic resin and compound producer A. Schulman. On the plus side, the share price of retailer The Neiman Marcus Group rose in the first half, spurred on by strong same-store sales, and ultimately a takeover bid, in what was a solid market for retail stocks. Includes reinvestment of distributions. †All performance and risk information for RSE reflects Investment Class results. Shares of the RSE’s Consultant and Financial Intermediary Classes bear an annual distribution expense that is not borne by the Investment Class. All performance information in this Report reflects past performance, is presented on a total return basis and reflects the reinvestment of distributions. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Current performance may be higher or lower than performance quoted. Current month-end performance may be obtained at www.roycefunds.com.			AVERAGE ANNUAL TOTAL RETURNS Through 6/30/05
			January - June 2005*	-2.29%
			1-Year	2.25
			3-Year	11.10
			5-Year	18.74
			Since Inception (5/1/98)	10.88
		*	Not annualized.
			CALENDAR YEAR TOTAL RETURNS
			Year	RSE
			2004	13.9%
			2003	27.6
			2002	15.3
			2001	30.8
			2000	16.3
			1999	-9.6
			TOP 10 POSITIONS (% of Net Assets)
			Banta Corporation	3.9%
			Borders Group	3.8
			Lubrizol Corporation	3.4
			Bio-Rad Laboratories Cl. A	3.1
			Lancaster Colony	3.1
			Bandag Cl. A	2.7
			Cascade Corporation	2.7
			National Presto Industries	2.5
			Schweitzer-Mauduit International	2.5
			Sanderson Farms	2.3
			PORTFOLIO SECTOR BREAKDOWN % of Net Assets
			Industrial Products	28.8%
			Consumer Products	19.1
			Consumer Services	17.4
			Industrial Services	16.3
			Health	5.9
			Financial Services	1.6
			Technology	1.4
			Miscellaneous	1.0
			Cash and Cash Equivalents	8.5
	THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  11

ROYCE SELECT FUND
	AVERAGE ANNUAL TOTAL RETURNS Through 6/30/05			Manager’s Discussion We think that the holdings in Royce Select Fund’s (RSF) limited portfolio are some of the highest quality companies that the small-cap world has to offer, but in the first half of 2005, the market made a different assessment. RSF was down 2.8% for the year-to-date period ended 6/30/05, trailing its small-cap benchmark, the Russell 2000, which lost 1.3% in the same period. After losing less than its benchmark in the bearish first quarter (-3.9% versus -5.3%), the Fund rallied in the upswing that took off on 4/28/05. Unfortunately for the short-term performance picture (an image we never linger over for long), RSF failed to keep pace with the Russell 2000. The Fund gained 1.2% in the second quarter compared to 4.3% for the small-cap index. However, the Fund’s returns over recent market cycle and other long-term periods remained impressive on both an absolute and relative basis. For the periods ended 6/30/05, RSF beat its benchmark from both the small-cap market peak on 3/9/00 (+95.5% versus +13.0%) and from the small-cap market trough on 10/9/02 through 6/30/05 (+112.9% versus +102.3%). RSF also outperformed the Russell 2000 for the three-year, five-year and since inception (11/18/98) periods ended 6/30/05. The Fund’s average annual total return since inception was 18.2%.      Holdings in the Technology sector posted the greatest losses on a dollar basis, as they generally did in the small-cap universe as a whole, continuing a trend that began in 2004. We parted ways with information technology (IT) consultant Gartner Group in February. Although the company showed a loss for 2005, our experience overall was positive. Late in June, we substantially reduced our position in business software company Verity after an earnings disappointment left us in doubt about the firm’s long-term prospects. On the other hand, we added to our stake in Technitrol, which manufactures electronic components and electrical contacts for various industries, primarily because of its low debt and positive cash flow. Outside of Technology, we sold our position out of RSF’s portfolio in energy services business Input/Output after it made a major downward adjustment to its earnings back in January. We also continued to hold a large position in eFunds Corporation, which provides multiple financial services, including risk management, electronic transaction processing and ATM management because of our high regard for its management and fundamentals. We reinitiated a position in contract oil and gas drilling services company Helmerich & Payne during January. We then took sizeable gains in February, May and June after its price nearly doubled, making it a rare short-term turnaround. Includes reinvestment of distributions. All performance information in this Report reflects past performance, is presented on a total return basis and reflects the reinvestment of distributions. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Current performance may be higher or lower than performance quoted. Current month-end performance may be obtained at www.roycefunds.com.
	January - June 2005*	–2.79	%
	1-Year	6.26
	1-Year (net)1	4.13
	3-Year	15.83
	5-Year	13.94
	Since Inception (11/18/98)	18.22
*	Not annualized.
1	One-year net results are adjusted to reflect the 2% fee assessed on redemptions of shares held for less than three years.
	CALENDAR YEAR TOTAL RETURNS
	Year	RSF
	2004	19.1	%
	2003	48.7
	2002	–15.8
	2001	24.5
	2000	15.0
	1999	35.4
	TOP 10 POSITIONS (% of Net Assets)
	Alliance Capital Management Holding L.P.	3.7	%
	Ritchie Bros. Auctioneers	3.3
	Polo Ralph Lauren Cl. A	2.9
	Penn Virginia	2.7
	SEI Investments	2.7
	Nuveen Investments Cl. A	2.6
	Cognex Corporation	2.3
	Plexus Corporation	2.2
	Exar Corporation	2.2
	ADTRAN	2.2
	PORTFOLIO SECTOR BREAKDOWN % of Net Assets
	Technology	23.9	%
	Financial Services	16.5
	Industrial Products	10.3
	Industrial Services	8.1
	Health	7.1
	Consumer Services	6.6
	Consumer Products	3.7
	Natural Resources	3.7
	Financial Intermediaries	2.4
	Miscellaneous	3.8
	Cash and Cash Equivalents	13.9

12  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005

ROYCE VALUE FUND
Managers’ Discussion One of our newer portfolios showed up many of its more seasoned siblings in the mostly difficult first six months of 2005. Royce Value Fund (RVV) finished the year-to-date period ended 6/30/05 with a return of 2.0%, ahead of its small-cap benchmark, the Russell 2000, which lost 1.3% for the same period. The Fund achieved its positive results with a combination of solid downside and upside performances. In the first quarter downdraft (which actually lasted through 4/28/05), the Fund was down 0.6% compared to the Russell 2000’s decline of 5.3%. When stock prices began to perk up in late April, RVV followed suit, with a second-quarter return of 2.6% that trailed the benchmark’s 4.3% result. The Fund also did well over long-term and market cycle periods. From the small-cap market trough on 10/9/02 through 6/30/05, RVV beat the small-cap index, gaining 166.9% versus 102.3% for the Russell 2000. The Fund also outperformed its benchmark for the one-, three-year and since inception (6/14/01) periods ended 6/30/05. RVV’s average annual total return since inception was 16.9%.      In contrast to the small-cap market as a whole (as well as other Royce-managed portfolios), most of the Fund’s sectors posted net gains, with losses coming from Financial Services, Industrial Products and Industrial Services. More in line with the small-cap world were RVV’s gains in energy stocks. Holdings in the Natural Resources sector made the greatest positive impact on performance, with oil and gas company St. Mary Land & Exploration Company, and energy services firms Trican Well Service and Patterson-UTI Energy leading the way. Although the price of each rose in the first half, we added to our position in all three companies. Outside of Natural Resources, we built our stake in eFunds Corporation, a company whose businesses include multiple financial services, risk management, electronic transaction processing and ATM management, because of our high opinion of its management and fundamentals. Its share price tumbled, especially in the second quarter as it worked to integrate a new acquisition. Our preference for strong fundamentals also led us to buy more shares of two companies that we rate as strong niche businesses. Scrap metal business Schnitzer Steel Industries saw its stock price soar to record highs earlier in 2005. Investors wasted little time taking profits, especially in light of analysts’ anxiety about the future prospects for the steel industry, and its stock price tumbled in the process. Telecommunications equipment maker Foundry Networks is the kind of picks-and-shovels technology products and services firm that we have always liked, with low debt and improved cash flows. Includes reinvestment of distributions. All performance information in this Report reflects past performance, is presented on a total return basis and reflects the reinvestment of distributions. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Current performance may be higher or lower than performance quoted. Current month-end performance may be obtained at www.roycefunds.com.			AVERAGE ANNUAL TOTAL RETURNS Through 6/30/05
			January - June 2005*	2.03%
			1-Year	17.64
			3-Year	23.76
			Since Inception (6/14/01)	16.88
		*	Not annualized.
			CALENDAR YEAR TOTAL RETURNS
			Year	RVV
			2004	30.9%
			2003	54.3
			2002	-23.5
			TOP 10 POSITIONS (% of Net Assets)
			Aspen Insurance Holdings	2.9%
			Nu Skin Enterprises Cl. A	2.8
			Trican Well Service	2.7
			eFunds Corporation	2.4
			Ensign Energy Services	2.3
			St. Mary Land & Exploration Company	2.2
			Endurance Specialty Holdings	2.1
			Polo Ralph Lauren Cl. A	2.1
			AmerUs Group	2.0
			Tektronix	2.0
			PORTFOLIO SECTOR BREAKDOWN % of Net Assets
			Natural Resources	17.2%
			Consumer Products	13.7
			Technology	12.1
			Financial Intermediaries	11.3
			Consumer Services	10.6
			Industrial Products	9.1
			Health	5.5
			Financial Services	4.1
			Industrial Services	1.7
			Miscellaneous	2.4
			Cash and Cash Equivalents	12.3
	THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  13

ROYCE VALUE PLUS FUND
	AVERAGE ANNUAL TOTAL RETURNS Through 6/30/05			Managers’ Discussion If 2003 and 2004 were big “plus” years from a performance perspective, then the first half of 2005 was very much a “minus” period for Royce Value Plus Fund’s (RVP) limited portfolio of small- and micro-cap stocks. RVP endured a dismal first half, with its decline of 5.4% for the year-to-date period ended 6/30/05 trailing its small-cap benchmark, the Russell 2000, which lost 1.3% for the same period. The Fund struggled in the downdraft that lasted through the first quarter until 4/28/05, losing 5.4% in the opening quarter and another 5.1% in April. This made the possibility of posting positive first-half results somewhat challenging, to say the least. So while the Fund rebounded with a 6.2% return from the interim small-cap trough on 4/28/05 through 6/30/05, it was not enough to undo the previous four months of bearish results. More encouraging was the Fund’s strength in the longer-term and market cycle periods ended 6/30/05. RVP soundly beat the Russell 2000 from the small-cap market trough on 10/9/02, gaining 170.2% versus 102.3% for the small-cap index. The Fund was also ahead of the Russell 2000 for the three-year and since inception (6/14/01) periods ended 6/30/05. The Fund’s average annual total returns for the three-year and since inception periods ended 6/30/05 were 23.9% and 22.3%.      Eight of the Fund’s nine sectors posted net losses in the first half, with the most significant on a dollar basis coming from the Technology, Industrial Products and Health sectors. Profit-taking was part of the story of the market’s struggles in the first quarter, as these sectors were three of the Fund’s four top-performing areas in 2004. In most cases, we took advantage of lower prices by buying additional shares. We more than tripled our position in Schnitzer Steel Industries when its price began to slip after reaching record highs earlier in 2005. The difficulty of integrating a new acquisition was a factor in the falling share price of eFunds Corporation. Liking its fundamentals and management, we added to our stake in this multi-service financial company that deals in risk management, electronic transaction processing and ATM management. Low debt, improving cash flow characteristics and a plummeting share price led us to build our position in telecommunications equipment and services company Foundry Networks. Although its rising price led us to trim our position, the growing business of Trican Well Service, namely in oil well completion and maintenance services, encouraged us to hold a large stake at June 30. The rising share price of video game and computer entertainment software retailer GameStop Corporation hit our sell target, prompting us to sell our shares in the second quarter. Includes reinvestment of distributions. All performance information in this Report reflects past performance, is presented on a total return basis and reflects the reinvestment of distributions. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Current performance may be higher or lower than performance quoted. Current month-end performance may be obtained at www.roycefunds.com.
	January - June 2005*	-5.39	%
	1-Year	6.71
	3-Year	23.89
	Since Inception (6/14/01)	22.31
*	Not annualized.
	CALENDAR YEAR TOTAL RETURNS
	Year	RVP
	2004	28.2	%
	2003	79.9
	2002	-14.7
	TOP 10 POSITIONS (% of Net Assets)
	eFunds Corporation	2.3	%
	Nu Skin Enterprises Cl. A	2.2
	Schnitzer Steel Industries Cl. A	2.1
	Ensign Energy Services	2.0
	Trican Well Service	1.9
	Endo Pharmaceuticals Holdings	1.8
	IPSCO	1.7
	Perot Systems Cl. A	1.7
	Photronics	1.7
	Foundry Networks	1.6
	PORTFOLIO SECTOR BREAKDOWN % of Net Assets
	Technology	16.2	%
	Health	15.5
	Industrial Products	13.8
	Natural Resources	13.5
	Industrial Services	11.1
	Consumer Products	8.1
	Financial Services	6.0
	Financial Intermediaries	2.8
	Consumer Services	2.2
	Miscellaneous	2.7
	Cash and Cash Equivalents	8.1

14  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005

ROYCE TECHNOLOGY VALUE FUND
Manager’s Discussion For small-cap technology companies, the first half of 2005 paralleled the previous calendar year, which is disappointing news for investors in Royce Technology Value Fund (RTV). As was the case in 2004, the first six months of 2005 saw a late rally that was not enough to overcome an earlier period of low returns. And once again, as in 2004, small-cap technology underperformed both larger tech issues and the stock market as a whole. RTV was down 8.5% for the year-to-date period ended 6/30/05, trailing both its small-cap benchmark, the Russell 2000, which declined 1.3%, and the technology sector of the Russell 2500 Index, which lost 8.1%, for the same period. The Fund suffered the dubious distinction of losing more on the downside and gaining less than its benchmark in the uptick. RTV was down 12.0% in the bearish first quarter, versus losses of 5.3% for the Russell 2000 and 10.3% for the micro-, small- and mid-cap companies that comprise the technology sector of the Russell 2500. The Fund was up 4.1% in the second-quarter rally compared to gains of 4.3% for the Russell 2000 and 2.5% for the Russell 2500 Technology sector. The Fund’s recent trough-to-peak market cycle performance and its longer-term average annual total returns were a bit better than its recent short-term results. RTV posted solid performance from the small-cap market trough on 10/9/02 through 6/30/05, gaining 100.9% versus returns of 102.3% for the Russell 2000 and 129.2% for the Russell 2500 Technology sector. The Fund outperformed its benchmark for the three-year period ended 6/30/05 and beat the Russell 2500 Technology sector for the three-year and since inception (12/31/01) periods ended 6/30/05. RTV’s average annual total return since inception was 9.3%.      While we saw a number of fundamentally solid small-cap technology companies with modest-to-fair growth over the last 12-18 months, the market saw chances to sell in a climate that looks excessively driven by liquidity in our eyes. It seemed that if a company in the tech business was not named “Google,” then life was pretty grim, at least through the interim small-cap trough on 4/28/05. The environment for tech improved marginally as the market as a whole rebounded, but the recovery was inconsistent. Based on their business fundamentals, we still liked the long-term prospects for many of RTV’s holdings, not simply those that enjoyed the more robust market of May and June. Thus, we held a large position in knowledge-retrieval software business Verity at June 30, even though its price fell through much of the first half, based on what we thought was a highly attractive valuation. Although the price of medical software and Internet application business The Trizetto Group mostly rose through 2005’s first six months, we repurchased shares in May after reducing our position because of its improving fundamentals and our confidence in its ability to keep growing. Includes reinvestment of distributions. All performance information in this Report reflects past performance, is presented on a total return basis and reflects the reinvestment of distributions. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Current performance may be higher or lower than performance quoted. Current month-end performance may be obtained at www.roycefunds.com.			AVERAGE ANNUAL TOTAL RETURNS Through 6/30/05
			January - June 2005*	-8.47%
			1-Year	-12.86
			3-Year	15.87
			Since Inception (12/31/01)	9.32
		*	Not annualized.
			CALENDAR YEAR TOTAL RETURNS
			Year	RTV
			2004	-9.6%
			2003	90.7
			2002	-13.4
			TOP 10 POSITIONS (% of Net Assets)
			SCO Group (The)	5.0%
			Jacada	2.9
			Stellent	2.5
			RightNow Technologies	2.4
			WebMD Corporation	2.4
			Intevac	2.1
			Aspen Technology	2.1
			Transaction Systems Architects Cl. A	2.1
			Indus International	2.1
			Verity	2.1
			INDUSTRY GROUP BREAKDOWN % of Net Assets
			Software	27.0%
			Internet Software and Services	23.1
			Telecommunications	14.1
			Commercial Services	5.8
			Semiconductors and Equipment	3.3
			Components and Systems	2.8
			Aerospace and Defense	1.5
			IT Services	1.5
			Other Financial Intermediaries	1.5
			Health Services	1.4
			Miscellaneous	1.0
			Cash and Cash Equivalents	17.0
	THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  15

ROYCE 100 FUND
	AVERAGE ANNUAL TOTAL RETURNS Through 6/30/05			Managers’ Discussion Although it’s one of our newer offerings, Royce 100 Fund (ROH) is fast distinguishing itself as one of our steadier-performing portfolios. The Fund was also one of only three of our 16 open-end funds to post positive performance in the first half of 2005. ROH gained 0.3% in the year-to-date period ended 6/30/05, enough to outperform its small-cap benchmark, the Russell 2000, which was down 1.3% for the same period. The Fund was able to put together its respectable first half by turning in a relatively solid performance in the down market of the first quarter (-2.9% versus -5.3% for the Russell 2000) and showing decent results in the market rally of the second quarter (+3.3% versus +4.3% for the benchmark). ROH displayed a similar pattern in recent short-term market cycle periods: The Fund was up 0.3% from the interim small-cap market peak on 12/28/04 through 6/30/05 compared to a loss of 1.6% for its small-cap benchmark. From the interim small-cap market trough on 4/28/05 through 6/30/05, the Fund gained 9.7% versus 11.5% for the Russell 2000. In addition, ROH outperformed the Russell 2000 for the one-year period ended 6/30/05. Although ROH underperformed its benchmark for the since inception (6/30/03) period, we were very pleased with its performance on an absolute basis for that relatively short time span. The Fund’s average annual total return since inception was 18.8%.      Both gains and losses could be found in all of the Fund’s sectors and industry groups. Other than the Fund’s two best performers on a dollar basis—Financial Services businesses Morningstar and Nasdaq Stock Market, both first purchased in 2005—gains and losses were also modest. Holdings in the Technology sector posted the largest dollar-based losses in the first half, accounting for five of ROH’s top-ten money-losing holdings. We also showed losses in three companies in which lower prices allowed us to build our position during the first half: multi-service financial firm eFunds Corporation, retailer Pier 1 Imports and motorsports collectibles business Action Performance Companies. After selling our shares last December, we re-initiated a position in petroleum products storage and transport company Holly Corporation. We liked its position as a regional energy company and its hefty dividend. We have owned shares of casual clothing retailer The Buckle in other Royce-managed portfolios for more than 10 years due to our high regard for its conservative, well-run operation. It was an early portfolio selection for ROH as well. Investors seem to have caught on, as increasing same-store sales appeared to boost its share price in the first half. We owned a large stake at June 30. Includes reinvestment of distributions. All performance information in this Report reflects past performance, is presented on a total return basis and reflects the reinvestment of distributions. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Current performance may be higher or lower than performance quoted. Current month-end performance may be obtained at www.roycefunds.com.
	January - June 2005*	0.29	%
	1-Year	12.37
	Since Inception (6/30/03)	18.81
*	Not annualized.
	CALENDAR YEAR TOTAL RETURNS
	Year	ROH
	2004	27.2	%
	TOP 10 POSITIONS (% of Net Assets)
	Lincoln Electric Holdings	1.7	%
	Nuveen Investments Cl. A	1.6
	Morningstar	1.5
	Universal Truckload Services	1.4
	Drew Industries	1.4
	SEI Investments	1.4
	Endo Pharmaceuticals Holdings	1.3
	Cimarex Energy	1.3
	Investment Technology Group	1.3
	Arrow International	1.3
	PORTFOLIO SECTOR BREAKDOWN % of Net Assets
	Industrial Products	17.5	%
	Technology	16.9
	Financial Services	10.6
	Industrial Services	10.6
	Health	9.4
	Consumer Services	8.0
	Consumer Products	6.1
	Natural Resources	5.2
	Financial Intermediaries	2.8
	Miscellaneous	4.4
	Cash and Cash Equivalents	8.5

16  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005

ROYCE DISCOVERY FUND
Manager’s Discussion After dominating small-cap performance in 2003, micro-cap stocks cooled off a bit in 2004 and were mostly behind their larger small-cap peers during the first half of 2005. Royce Discovery Fund (RDF) was down 1.4% for the year-to-date period ended 6/30/05, slightly trailing its small-cap benchmark, the Russell 2000, which lost 1.3% in the same period. RDF did relatively well in the first-quarter downdraft, as one might expect from a micro-cap portfolio built using a quantitative model based on conservative value criteria. The Fund was down 4.4% versus a loss of 5.3% for the Russell 2000. It was in the more dynamic market following the interim small-cap trough on 4/28/05 that RDF failed to keep pace with the small-cap index. The Fund gained 3.1% in the second quarter versus a return of 4.3% for the Russell 2000. We do not believe that the Fund’s narrow underperformance versus its benchmark is of any consequence relative to its goal of outperforming the Russell 2000 over full market cycle and other long-term periods. RDF outpaced the Russell 2000 for the since inception (10/3/03) period ended 6/30/05. The Fund’s average annual total return since inception was 14.9%.      The Fund’s first six months of 2005 resembled the entire year of 2004 to some extent. Returns through the first nine months of 2004 were negative before a furious fourth-quarter rally gave the Fund a positive return for the year, though it was not enough to overcome a higher return for the benchmark. Part of the Fund’s underperformance versus the Russell 2000 for the year-to-date period ended 6/30/05 can be attributed to its underweighting in energy stocks, which led small-cap returns through the first half as they did in 2004. The Fund’s holdings in oil and gas as well as energy services companies did well, but they were only a small part of the portfolio. In contrast to much of the small-cap market, RDF’s Technology issues posted strong positive performance as a group. Much of the gain came from two holdings in the software business. In June, we sold our shares of hospitality and retail software maker PAR Technology after its price climbed well beyond our sell target. That same month, we sold our position in business software company TALX Corporation as its price was on the rise. Elsewhere in the portfolio, the greatest losses on a dollar basis came from the Industrial Products sector, with Olympic Steel, LeCroy Corporation and Aceto Corporation posting the largest losses in the first half. Includes reinvestment of distributions. All performance information in this Report reflects past performance, is presented on a total return basis and reflects the reinvestment of distributions. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Current performance may be higher or lower than performance quoted. Current month-end performance may be obtained at www.roycefunds.com.			AVERAGE ANNUAL TOTAL RETURNS Through 6/30/05
			January - June 2005*	-1.41%
			1-Year	6.52
			Since Inception (10/3/03)	14.91
		*	Not annualized.
			CALENDAR YEAR TOTAL RETURNS
			Year	RDF
			2004	13.4%
			TOP 10 POSITIONS (% of Net Assets)
			MTC Technologies	0.9%
			Capital Crossing Bank	0.9
			SI International	0.8
			Trans World Entertainment	0.8
			EnPro Industries	0.8
			Noble International	0.8
			Amedisys	0.8
			Hallwood Group	0.8
			Synaptics	0.8
			Hi-Tech Pharmacal	0.8
			PORTFOLIO SECTOR BREAKDOWN % of Net Assets
			Technology	18.8%
			Health	18.4
			Financial Intermediaries	12.0
			Industrial Products	8.3
			Consumer Services	7.9
			Industrial Services	7.4
			Consumer Products	5.0
			Natural Resources	2.1
			Financial Services	2.0
			Miscellaneous	4.7
			Cash and Cash Equivalents	13.4
	THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  17

ROYCE FINANCIAL SERVICES FUND
	AVERAGE ANNUAL TOTAL RETURNS Through 6/30/05			Manager’s Discussion The quarterly performances of Royce Financial Services Fund (RFS) displayed less volatility than comparable results for its small-cap benchmark, the Russell 2000, though each finished the first half in a similar place. RFS was down 1.2% for the year-to-date period ended 6/30/05, nearly even with the Russell 2000, which was down 1.3% for the same period, but slightly trailing the micro-, small- and mid-cap companies in the financial services sector of the Russell 2500 Index, which declined 0.9% in the first half. RFS was down 2.3% in the first quarter, versus a loss of 5.3% for its benchmark and 7.5% for the financial services sector of the Russell 2500 Index. In the second quarter, which was helped by the market rally that began in late April, the Fund gained 1.1%, losing ground to both the Russell 2000 (+4.3%) and the financial services companies in the Russell 2500 Index (+7.0%). Although the Fund is young, we have been pleased with its results thus far, even allowing for its somewhat disappointing first-half results. We were also encouraged by its relative lack of volatility during the first six months of 2005. RFS beat the Russell 2000 for the one-year period ended 6/30/05. The Fund’s average annual total return since inception (12/31/03) was 8.9%.      The Federal Reserve raised interest rates one quarter point four times in the first half, continuing the generally measured pace of previous increases; the net effect was an increase of 1% from December 2004. In addition, long-term interest rates continued to decline. This meant good news for bond investors. After defying forecasts that it would weaken in 2004, the market for debt was surprisingly resilient through June 30, perhaps in part because of the perception that the U.S. economy is slowing down, although inflation remains more of a concern than recession, especially on the part of the Federal Reserve. In any case, these developments played a role in the rebound of many financial services stocks in 2005’s second quarter. There were a couple of problems for the Fund with this otherwise rosy picture for financial companies. The first was that even in the first quarter, prices did not decline across the board to levels that we found attractive from a buyer’s perspective, a situation that may have hindered returns in 2004 as well. The second was that the interest-rate developments helped certain financial businesses, but not all. The upshot was a quiet six months in terms of both portfolio buying and selling and in terms of performance. Includes reinvestment of distributions. All performance information in this Report reflects past performance, is presented on a total return basis and reflects the reinvestment of distributions. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Current performance may be higher or lower than performance quoted. Current month-end performance may be obtained at www.roycefunds.com.
	January - June 2005*	-1.24	%
	1-Year	12.53
	Since Inception (12/31/03)	8.92
*	Not annualized.
	CALENDAR YEAR TOTAL RETURNS
	Year	RFS
	2004	15.1	%
	TOP 10 POSITIONS (% of Net Assets)
	Alliance Capital Management Holding L.P.	5.0	%
	Nuveen Investments Cl. A	4.3
	Fair Isaac	3.7
	Epoch Holding	3.4
	Brown & Brown	3.0
	Morningstar	2.8
	Federated Investors Cl. B	2.8
	Bank of NT Butterfield	2.8
	Aspen Insurance Holdings	2.6
	SEI Investments	2.5
	PORTFOLIO SECTOR BREAKDOWN % of Net Assets
	Financial Intermediaries	48.0	%
	Financial Services	42.0
	Industrial Services	2.2
	Consumer Services	1.3
	Diversified Investment Companies	0.6
	Cash and Cash Equivalents	5.9

18  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005

ROYCE DIVIDEND VALUE FUND
	Manager’s Discussion Although its performances in the first and second quarters of 2005 were far less volatile than those of its small-cap benchmark, the Russell 2000, Royce Dividend Value Fund (RDV) wound up in a similar spot during the first half. RDV was down 1.2% for the year-to-date period ended 6/30/05, nearly even with the Russell 2000, which declined 1.3% during the same period. The Fund acquitted itself well in the difficult first quarter, losing only 1.6% versus a loss of 5.3% for the small-cap index. However, in the market rebound that followed the interim small-cap trough on 4/28/05, RDV gave up some ground to its benchmark. Its second-quarter return was 0.4%, which lagged the Russell 2000’s more robust gain of 4.3%. Nonetheless, we have been pleased with the Fund’s performance over its still-short lifespan. Although its first-half return was somewhat underwhelming, we were satisfied that the Fund showed far less volatility than the Russell 2000. RDV outperformed the small-cap index for the one-year period ended 6/30/05. The Fund’s average annual total return since inception (5/3/04) was 9.9%.      Six of the Fund’s 10 equity sectors posted net losses in the first half, with the most significant declines on a dollar basis coming from the Technology and Financial Intermediaries sectors. In both areas, a small number of holdings made a large impact on performance. In Technology, the price of Lowrance Electronics mostly fell in the first half, even after many stocks rebounded in May and June. The market seemed disenchanted with the company’s newer, higher-expense sonar and global positioning system products, but we held a good-sized stake at June 30. Dionex is engaged in the production of chromotography instruments and chemicals. An April earnings disappointment sent its already-slumping share price into a free fall, leading us to double our position in June. A significant earnings disappointment and insider trading problems surrounding a 2001 private investment on public equity deal depressed the share price of investment banking firm Friedman, Billings, Ramsey Group. Elsewhere in the portfolio, the stock price of specialty chemical company Quaker Chemical fell and was unable to recover once the firm issued a warning in May about slower sales in Europe affecting its most recent quarterly profits. Modest gains could be found in the Financial Services, Industrial Services and Natural Resources sectors. All performance information in this Report reflects past performance, is presented on a total return basis and reflects the reinvestment of distributions. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Current performance may be higher or lower than performance quoted. Current month-end performance may be obtained at www.roycefunds.com.		AVERAGE ANNUAL TOTAL RETURNS Through 6/30/05
			January - June 2005*	-1.24%
			1-Year	10.94
			Since Inception (5/3/04)	9.94
			* Not annualized.
			TOP 10 POSITIONS (% of Net Assets)
			Alliance Capital Management Holding L.P.	5.7%
			SEI Investments	3.6
			Athena Neurosciences Finance Bond	3.6
			Gallagher (Arthur J.) & Company	3.4
			Captial Trust Cl. A	2.9
			Federated Investors Cl. B	2.9
			T. Rowe Price Group	2.4
			Franklin Electric	2.2
			Scientific-Atlanta	2.2
			Nuveen Investments Cl. A	2.2
			PORTFOLIO SECTOR BREAKDOWN % of Net Assets
			Financial Services	24.7%
			Technology	14.4
			Industrial Products	14.0
			Financial Intermediaries	13.3
			Consumer Services	6.2
			Industrial Services	4.2
			Consumer Products	3.7
			Utilities	1.5
			Health	1.1
			Natural Resources	0.8
			Miscellaneous	1.4
			Bonds and Preferred Stocks	4.5
			Cash and Cash Equivalents	10.2
		THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  19

SCHEDULES OF INVESTMENTS

      Pennsylvania Mutual Fund

	SHARES		VALUE		SHARES		VALUE
COMMON STOCKS – 86.7%				Retail Stores - 5.6%
				AnnTaylor Stores a,d	374,900	$	9,102,572
Consumer Products – 13.4%				Big Lots a	950,700		12,587,268
Apparel and Shoes - 4.4%				Buckle (The)	616,300		27,326,742
Cutter & Buck c	634,100	$	8,179,890	Cato Corporation Cl. A	706,350		14,586,127
Kenneth Cole Productions Cl. A	612,000		19,045,440	Charming Shoppes a,d	960,200		8,958,666
K-Swiss Cl. A	536,100		17,337,474	Claire’s Stores	667,800		16,060,590
Steven Madden a	531,300		9,435,888	Deb Shops	95,300		2,760,841
Polo Ralph Lauren Cl. A	370,800		15,985,188	Dress Barn (The) a,d	90,100		2,038,963
Stride Rite	1,080,000		14,893,200	Pier 1 Imports	997,900		14,160,201
Weyco Group c	775,500		15,281,227	Talbots	468,000		15,195,960
				†Too a,d	3,400		79,458
			100,158,307	Weis Markets	175,500		6,807,645
Collectibles - 0.2%							129,665,033
Department 56 a	497,000		5,094,250
				Other Consumer Services - 0.1%
Food/Beverage/Tobacco - 0.6%				†Corinthian Colleges a,d	61,800		789,186
Boston Beer Company Cl. A a,d	524,600		11,772,024
CoolBrands International a,d	568,000		1,910,023	Total (Cost $176,981,543)			216,262,621
			13,682,047	Financial Intermediaries – 8.9%
				Insurance - 7.8%
Home Furnishing and Appliances - 2.8%				Alleghany Corporation a	59,818		17,765,946
American Woodmark	388,800		11,667,888	AmerUs Group	389,100		18,696,255
Ethan Allen Interiors	714,200		23,932,842	Argonaut Group a,d	241,000		5,564,690
Hooker Furniture	525,300		9,176,991	Aspen Insurance Holdings	690,700		19,035,692
Natuzzi ADR b	732,700		5,964,178	Baldwin & Lyons Cl. B	310,000		7,471,000
Stanley Furniture Company	579,424		14,230,653	Erie Indemnity Company Cl. A	158,500		8,598,625
				†Endurance Specialty Holdings	630,700		23,853,074
			64,972,552	PXRE Group	482,300		12,163,606
				ProAssurance Corporation a	393,454		16,430,639
Sports and Recreation - 2.4%				RLI	130,462		5,818,605
Callaway Golf Company	464,000		7,159,520	Scottish Re Group	531,600		12,885,984
Monaco Coach	598,500		10,288,215	United Fire & Casualty Company	268,200		11,913,444
Oakley	274,600		4,676,438	Wesco Financial	16,540		5,954,400
Thor Industries	501,900		15,774,717	Zenith National Insurance	185,200		12,567,672
Winnebago Industries	488,100		15,985,275
							178,719,632
			53,884,165
				Securities Brokers - 0.2%
Other Consumer Products - 3.0%				E*TRADE Financial a	343,000		4,798,570
Blyth	224,700		6,302,835
Burnham Holdings Cl. A	103,052		2,576,300	Other Financial Intermediaries - 0.9%
Fossil a,d	388,700		8,823,490	TSX Group	696,200		20,746,214
Matthews International Cl. A	233,900		9,112,744
RC2 Corporation a	578,600		21,738,002	Total (Cost $131,282,211)			204,264,416
Radica Games	631,600		5,468,393
Universal Electronics a,d	121,898		2,022,288	Financial Services – 2.7%
Yankee Candle Company	426,400		13,687,440	Information and Processing - 1.3%
				eFunds Corporation a,d	1,085,800		19,533,542
			69,731,492	SEI Investments	236,500		8,833,275
Total (Cost $232,396,978)			307,522,813				28,366,817
Consumer Services – 9.4%				Investment Management - 1.0%
Direct Marketing - 1.0%				Alliance Capital Management Holding L.P.	270,700		12,652,518
Nu Skin Enterprises Cl. A	962,600		22,428,580	Cohen & Steers	158,400		3,264,624
				Gabelli Asset Management Cl. A	135,800		6,001,002
Leisure and Entertainment - 0.8%				Westwood Holdings Group	98,400		1,761,360
Dover Downs Gaming & Entertainment	644,600		8,547,396
Multimedia Games a,d	1,018,800		11,216,988				23,679,504
			19,764,384	Other Financial Services - 0.4%
				Electro Rent a	240,000		3,489,600
Restaurants and Lodgings - 1.9%				†International Securities Exchange Cl. A a,d	120,000		3,013,200
CBRL Group	292,000		11,347,120	MarketAxess Holdings a,d	186,500		2,107,450
†CEC Entertainment a,d	60,600		2,550,654
Ruby Tuesday	666,300		17,257,170				8,610,250
Ryan’s Restaurant Group a,d	889,400		12,460,494
				Total (Cost $51,604,802)			60,656,571
			43,615,438

20  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

JUNE 30, 2005 (Unaudited)

	SHARES		VALUE		SHARES		VALUE
Health – 10.9%				Industrial Components - 0.3%
Commercial Services - 0.7%				Powell Industries a	317,000	$	5,981,790
AMN Healthcare Services a	307,863	$	4,627,181
Hooper Holmes	1,941,900		8,058,885	Machinery - 3.3%
IDEXX Laboratories a,d	39,900		2,486,967	Graco	89,650		3,054,376
				Lincoln Electric Holdings	586,780		19,451,757
			15,173,033	Pason Systems	867,000		15,072,722
				†Rofin-Sinar Technologies a,d	472,300		15,491,440
Drugs and Biotech - 2.7%				Thomas Industries	232,400		9,286,704
Applera Corporation-				Woodward Governor Company	173,372		14,568,449
Celera Genomics Group a,d	257,100		2,820,387
Endo Pharmaceuticals Holdings a,d	873,300		22,950,324				76,925,448
Hi-Tech Pharmacal a,d	386,000		12,297,960
Lexicon Genetics a	1,034,100		5,108,454	Metal Fabrication and Distribution - 1.9%
Par Pharmaceutical Companies a,d	59,200		1,883,152	Gibraltar Industries	731,225		13,556,912
Perrigo Company	891,900		12,433,086	IPSCO	505,500		22,090,350
Theragenics Corporation a	206,600		665,252	Kaydon Corporation	60,000		1,671,000
Zila a,d	1,633,500		4,671,810	Schnitzer Steel Industries Cl. A	300,000		7,110,000
			62,830,425				44,428,262
Health Services - 3.8%				Specialty Chemicals and Materials - 0.2%
AMERIGROUP Corporation a,d	474,600		19,078,920	MacDermid	163,700		5,100,892
Cross Country Healthcare a	614,500		10,446,500
Healthcare Services Group	872,475		17,519,298	Other Industrial Products - 0.7%
Horizon Health a,d	546,800		12,789,652	Brady Corporation Cl. A	157,700		4,888,700
Molina Healthcare a,d	215,100		9,520,326	HNI Corporation	203,700		10,419,255
U.S. Physical Therapy a,c,d	957,975		18,373,961
							15,307,955
			87,728,657
				Total (Cost $154,982,828)			249,857,529
Medical Products and Devices - 2.1%
Arrow International	491,700		15,685,230	Industrial Services – 3.6%
Thoratec Corporation a	366,600		5,623,644	Commercial Services - 2.0%
Viasys Healthcare a	509,600		11,511,864	Carlisle Holdings	94,500		590,625
Vital Signs	186,195		8,065,967	Exponent a,d	148,600		4,246,988
Young Innovations	222,550		8,307,792	FTI Consulting a,d	511,800		10,696,620
				LECG Corporation a,d	50,000		1,063,000
			49,194,497	MPS Group a,d	350,100		3,297,942
				RCM Technologies a	180,500		765,320
Personal Care - 1.6%				RemedyTemp Cl. A a	476,970		4,221,185
CNS	476,277		10,882,929	SM&A a,c	1,017,900		9,130,563
Inter Parfums	720,500		13,970,495	West Corporation a	285,400		10,959,360
Nutraceutical International a,c	819,746		10,943,609
							44,971,603
			35,797,033
				Engineering and Construction - 0.1%
Total (Cost $164,137,841)			250,723,645	Dycom Industries a,d	164,700		3,262,707
Industrial Products – 10.9%				Food and Tobacco Processors - 0.3%
Automotive - 0.8%				Zapata Corporation a,c	1,009,600		6,158,560
Strattec Security a,c	202,740		11,041,220
Wescast Industries Cl. A	276,300		6,280,299	Industrial Distribution - 0.2%
				Ritchie Bros. Auctioneers	101,400		3,908,970
			17,321,519
				Printing - 0.4%
Building Systems and Components - 2.2%				Courier Corporation	124,650		4,787,806
Aaon a,d	32,050		570,170	Ennis	315,600		5,718,672
Drew Industries a	416,500		18,909,100
Modtech Holdings a	234,785		1,526,103				10,506,478
Preformed Line Products Company	189,786		7,743,269
Simpson Manufacturing	658,000		20,101,900	Transportation and Logistics - 0.6%
Teleflex	25,000		1,484,250	Nordic American Tanker Shipping	227,600		9,661,620
				Patriot Transportation Holding a	90,800		4,623,536
			50,334,792
							14,285,156
Construction Materials - 1.5%
Ash Grove Cement Company	50,018		7,852,826	Total (Cost $62,898,699)			83,093,474
Florida Rock Industries	362,700		26,604,045
				Natural Resources – 14.0%
			34,456,871	Energy Services - 5.5%
				Ensign Energy Services	1,014,700		24,489,617
				Input/Output a,d	716,700		4,500,876
				Oil States International a	576,300		14,505,471

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
THE ROYCE FUNDS SEMIANNUAL REPORT  2005  |  21

SCHEDULES OF INVESTMENTS

      Pennsylvania Mutual Fund (continued)

	SHARES		VALUE		SHARES		VALUE
Natural Resources (continued)
Energy Services (continued)				Entegris a	1,137,600	$	11,262,240
Patterson-UTI Energy	530,400	$	14,761,032	Exar Corporation a,d	417,500		6,216,575
Precision Drilling a,d	428,400		16,913,232	Fairchild Semiconductor
RPC	794,850		13,448,862	International Cl. A a	833,500		12,294,125
TETRA Technologies a,d	461,850		14,709,923	OmniVision Technologies a,d	1,015,200		13,796,568
Trican Well Service a	900,900		22,147,492	Semitool a	1,077,967		10,283,805
			125,476,505				65,671,681
Oil and Gas - 4.4%				Software - 2.2%
Cimarex Energy a	499,114		19,420,526	InterVideo a,c	758,500		10,907,230
Edge Petroleum a,d	675,500		10,551,310	iPass a	1,869,700		11,330,382
St. Mary Land & Exploration Company	946,900		27,441,162	Pervasive Software a,c,d	1,237,100		5,240,356
†SEACOR Holdings a,d	95,000		6,108,500	Sybase a,d	80,500		1,477,175
Unit Corporation a	644,600		28,368,846	Transaction Systems Architects Cl. A a	838,300		20,647,329
Whiting Petroleum a	248,100		9,008,511
							49,602,472
			100,898,855
				Telecommunications - 1.3%
Precious Metals and Mining - 4.1%				Brooktrout a	543,600		6,066,576
Agnico-Eagle Mines	584,200		7,360,920	Catapult Communications a,d	459,300		7,835,658
Apex Silver Mines a,d	519,000		7,131,060	Foundry Networks a,d	1,698,600		14,658,918
Eldorado Gold a	1,989,400		5,311,698	KVH Industries a	231,000		2,136,750
Glamis Gold a,d	880,700		15,156,847
Goldcorp	854,500		13,484,010				30,697,902
Golden Star Resources a	1,675,300		5,193,430
Hecla Mining Company a,d	2,666,800		12,160,608	Total (Cost $214,320,770)			262,943,530
Meridian Gold a,d	971,200		17,481,600
Minefinders Corporation a	587,700		2,715,174	Miscellaneous – 1.4%
Silver Standard Resources a,d	764,000		8,931,160	Total (Cost $30,789,680)			31,283,260
			94,926,507	TOTAL COMMON STOCKS
				(Cost $1,423,152,299)			1,987,909,726
Total (Cost $203,756,947)			321,301,867
				REPURCHASE AGREEMENT – 13.5%
Technology – 11.5%				State Street Bank & Trust Company,
Aerospace and Defense - 0.7%				2.55% dated 6/30/05, due 7/1/05,
Curtiss-Wright	252,000		13,595,400	maturity value $309,473,920
Integral Systems	101,500		2,296,945	(collateralized by obligations of various
				U.S. Government Agencies, valued at
			15,892,345	$319,026,822)
				(Cost $309,452,000)			309,452,000
Components and Systems - 2.1%
Dionex Corporation a	150,676		6,570,980	COLLATERAL RECEIVED FOR SECURITIES LOANED – 1.9%
Excel Technology a	159,900		3,885,570	U.S. Treasury Notes
Neoware Systems a,c,d	847,523		8,678,636	4.75% due 11/15/08			4,372
Plexus Corporation a,d	175,000		2,490,250	U.S. Treasury Strip-Interest
Richardson Electronics	372,862		2,721,893	due 8/15/06-8/15/15			34,061
Rimage Corporation a,c	570,996		12,122,245	U.S. Treasury Strip-Principal
TTM Technologies a,d	909,200		6,919,012	7.25% due 5/15/16			5,275
Technitrol	306,500		4,330,845	Money Market Funds
				AIM Liquid Assets Institutional Fund			27,024,894
			47,719,431	AIM Treasury Assets Institutional Fund			14,863,761
				Janus Institutional Money Market Fund			2,572,885
Distribution - 0.5%
Benchmark Electronics a,d	100,000		3,042,000	(Cost $44,505,248)			44,505,248
Nu Horizons Electronics a,c	1,344,234		8,603,098
				TOTAL INVESTMENTS – 102.1%
			11,645,098	(Cost $1,777,109,547)			2,341,866,974
IT Services - 1.8%				LIABILITIES LESS CASH AND OTHER ASSETS – (2.1%)			(48,865,163	)
Forrester Research a	237,700		4,238,191
MAXIMUS	539,200		19,028,368	NET ASSETS – 100.0%		$	2,293,001,811
Perot Systems Cl. A a,d	1,158,900		16,479,558
Syntel	122,800		1,968,484
			41,714,601
Semiconductors and Equipment - 2.9%
Cabot Microelectronics a,d	225,000		6,522,750
Cognex Corporation	202,200		5,295,618

22  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

JUNE 30, 2005 (Unaudited)

      Royce Micro-Cap Fund

	SHARES		VALUE		SHARES		VALUE
COMMON STOCKS – 88.6%				Financial Services – 1.2%
				Investment Management - 0.7%
Consumer Products – 2.8%				ADDENDA Capital	88,700	$	2,110,353
Apparel and Shoes - 0.5%				U.S. Global Investors Cl. A a	245,672		1,159,572
Steven Madden a	179,500	$	3,187,920	Westwood Holdings Group	40,300		721,370
Collectibles - 0.1%							3,991,295
Enesco Group a	191,600		572,884
				Other Financial Services - 0.5%
Food/Beverage/Tobacco - 0.6%				Electro Rent a	228,300		3,319,482
CoolBrands International a	542,600		1,824,610
Green Mountain Coffee Roasters a	55,700		1,889,901	Total (Cost $5,802,738)			7,310,777
			3,714,511	Health – 15.0%
				Commercial Services - 1.6%
Sports and Recreation - 0.5%				AMICAS a	250,000		1,132,500
Arctic Cat	129,200		2,652,476	Discovery Partners International a	824,400		2,357,784
				First Consulting Group a	648,729		3,327,331
Other Consumer Products - 1.1%				Hooper Holmes	633,000		2,626,950
Lazare Kaplan International a	41,500		423,300
RC2 Corporation a	133,700		5,023,109				9,444,565
Radica Games	122,000		1,056,276
				Drugs and Biotech - 6.3%
			6,502,685	Cell Genesys a	479,500		2,565,325
				Cerus Corporation a	405,000		1,794,150
Total (Cost $15,060,771)			16,630,476	Compugen a	326,000		997,560
				Durect Corporation a,d	631,200		3,212,808
Consumer Services – 5.7%				DUSA Pharmaceuticals a	245,600		2,284,080
Leisure and Entertainment - 1.7%				Gene Logic a	1,342,375		4,443,261
Dover Downs Gaming & Entertainment	148,000		1,962,480	Lexicon Genetics a	890,600		4,399,564
Multimedia Games a,d	367,700		4,048,377	Myriad Genetics a	148,600		2,325,590
New Frontier Media a	652,100		4,336,465	Nuvelo a	173,600		1,341,928
				Orchid Cellmark a	431,300		4,662,353
			10,347,322	Pharmacyclics a	164,000		1,231,640
				VIVUS a	1,219,400		4,493,489
Restaurants and Lodgings - 0.3%				Zila a	1,399,300		4,001,998
Benihana Cl. A a	132,585		1,895,965
							37,753,746
Retail Stores - 3.7%
Brookstone a	210,405		3,972,446	Health Services - 1.7%
Buckle (The)	146,000		6,473,640	Albany Molecular Research a	119,300		1,670,200
Cache a	277,250		4,607,895	HMS Holdings a	95,000		632,700
Cato Corporation Cl. A	249,300		5,148,045	†Horizon Health a	172,600		4,037,114
Duckwall-ALCO Stores a	83,950		1,803,246	U.S. Physical Therapy a	196,300		3,765,034
			22,005,272				10,105,048
Total (Cost $23,098,540)			34,248,559	Medical Products and Devices - 4.3%
				Adeza Biomedical a	73,000		1,239,540
Financial Intermediaries – 6.1%				Aksys a,d	407,100		810,129
Banking - 0.9%				Bruker BioSciences a	1,242,000		4,955,580
Bancorp (The) a	45,370		791,253	Caliper Life Sciences a	205,300		1,149,680
Canadian Western Bank	206,000		4,847,356	Medical Action Industries a	84,300		1,504,755
				Merit Medical Systems a	221,100		3,407,151
			5,638,609	NMT Medical a	244,200		2,442,000
				OrthoLogic Corporation a	234,900		909,063
Insurance - 4.9%				†Possis Medical a	324,700		3,289,211
American Safety Insurance Holdings a	257,500		3,919,150	Quinton Cardiology Systems a	42,000		337,680
Argonaut Group a	271,100		6,259,699	Synovis Life Technologies a	136,800		1,091,664
Baldwin & Lyons Cl. B	29,750		716,975	Vital Signs	28,300		1,225,956
NYMAGIC	171,900		4,013,865	Young Innovations	99,150		3,701,270
Navigators Group a	132,100		4,566,697
PXRE Group	209,100		5,273,502				26,063,679
United Fire & Casualty Company	100,000		4,442,000
				Personal Care - 1.1%
			29,191,888	Lifeline Systems a	96,700		3,106,004
				Nutraceutical International a	240,100		3,205,335
Securities Brokers - 0.3%
Sanders Morris Harris Group	109,600		1,885,120				6,311,339
Total (Cost $21,422,084)			36,715,617	Total (Cost $80,143,933)			89,678,377

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
THE ROYCE FUNDS SEMIANNUAL REPORT  2005  |  23

SCHEDULES OF INVESTMENTS

      Royce Micro-Cap Fund (continued)

	SHARES		VALUE		SHARES		VALUE
Industrial Products – 10.9%				Transportation and Logistics - 2.3%
Automotive - 0.6%				Covenant Transport Cl. A a	152,900	$	2,018,280
Spartan Motors	71,000	$	765,380	Marten Transport a	161,100		3,381,489
Wescast Industries Cl. A	133,100		3,025,363	Patriot Transportation Holding a	74,800		3,808,816
				Vitran Corporation Cl. A a	308,050		4,867,190
			3,790,743
							14,075,775
Building Systems and Components - 2.4%
Aaon a	164,900		2,933,571	Total (Cost $36,603,299)			46,725,462
Drew Industries a	155,200		7,046,080
LSI Industries	304,250		4,241,245	Natural Resources – 19.2%
				Energy Services - 8.0%
			14,220,896	Dawson Geophysical a	362,400		7,704,624
				Dril-Quip a	110,900		3,217,209
Construction Materials - 0.1%				Gulf Island Fabrication	308,700		6,136,956
Synalloy Corporation a	80,700		819,105	GulfMark Offshore a	141,100		3,853,441
				Input/Output a	719,000		4,515,320
Industrial Components - 1.8%				NATCO Group Cl. A a	343,100		4,566,661
InPlay Technologies a,c	835,200		1,336,320	RPC	105,000		1,776,600
Intermagnetics General a	166,700		5,127,692	Tesco Corporation a	657,100		7,188,674
Powell Industries a	227,700		4,296,699	TETRA Technologies a	146,300		4,659,655
				Total Energy Services Trust	555,200		4,585,883
			10,760,711
							48,205,023
Machinery - 2.1%
Cascade Corporation	55,700		2,409,025	Oil and Gas - 1.7%
Key Technology a,c	256,483		2,744,368	Edge Petroleum a	165,700		2,588,234
Pason Systems	421,200		7,322,527	Pioneer Drilling Company a	305,600		4,663,456
				Savanna Energy Services a	179,500		2,834,905
			12,475,920
							10,086,595
Metal Fabrication and Distribution - 3.1%
Gibraltar Industries	152,800		2,832,912	Precious Metals and Mining - 9.1%
†Harris Steel Group	334,100		5,617,417	African Platinum a	1,800,000		717,576
†Metal Management	233,500		4,518,225	Alamos Gold a,d	1,036,300		3,552,449
NN	55,700		706,276	Eldorado Gold a	1,210,000		3,230,700
†Novamerican Steel a	126,600		3,494,160	Etruscan Resources a	2,609,400		3,812,297
RTI International Metals a	40,000		1,256,400	Gammon Lake Resources a	866,600		5,832,218
				Golden Star Resources a	847,600		2,627,560
			18,425,390	Kingsgate Consolidated	713,108		1,541,603
				Metallica Resources a	3,960,300		4,910,772
Specialty Chemicals and Materials - 0.1%				Minefinders Corporation a	701,400		3,240,468
American Pacific a	46,950		375,600	Miramar Mining a	686,500		789,475
				Northern Orion Resources a	2,645,800		6,482,210
Other Industrial Products - 0.7%				NovaGold Resources a,d	739,300		5,640,859
Color Kinetics a	168,000		1,787,520	Silver Standard Resources a	374,000		4,372,060
Peerless Manufacturing a,c	156,400		2,267,800	Spur Ventures a	641,200		910,617
Quixote Corporation	22,500		441,225	Western Silver a	691,100		6,012,570
				Yamana Gold a,d	322,000		1,188,180
			4,496,545
							54,861,614
Total (Cost $58,758,291)			65,364,910
				Real Estate - 0.4%
Industrial Services – 7.8%				Kennedy-Wilson a	208,900		2,193,450
Commercial Services - 3.2%
Bennett Environmental a	225,000		715,500	Total (Cost $83,994,614)			115,346,682
Carlisle Holdings	950,799		5,942,494
CorVel Corporation a	67,200		1,688,064	Technology – 15.2%
Exponent a	280,817		8,025,750	Aerospace and Defense - 1.4%
New Horizons Worldwide a	250,800		877,775	Cubic Corporation	63,700		1,130,038
RCM Technologies a	93,700		397,288	Ducommun a	204,600		3,459,786
RemedyTemp Cl. A a	139,400		1,233,690	Integral Systems	173,100		3,917,253
			18,880,561				8,507,077
Engineering and Construction - 0.3%				Components and Systems - 4.0%
Keith Companies a	70,000		1,517,600	Excel Technology a	168,200		4,087,260
				Lowrance Electronics	174,500		3,667,990
Food and Tobacco Processors - 1.0%				MOCON	45,775		430,285
Omega Protein a	329,800		2,084,336	Metrologic Instruments a	159,500		2,000,130
Zapata Corporation a	673,600		4,108,960
			6,193,296
Printing - 1.0%
†Courier Corporation	84,132		3,231,510
Ennis	156,000		2,826,720
			6,058,230

24  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

JUNE 30, 2005 (Unaudited)

	SHARES		VALUE			VALUE
Technology (continued)				Miscellaneous – 4.7%
Components and Systems (continued)				Total (Cost $26,942,135)	$	28,035,256
OSI Systems a	155,100	$	2,449,029
Perceptron a	93,400		634,186	TOTAL COMMON STOCKS
Performance Technologies a	341,200		1,886,836	(Cost $438,163,771)		531,076,451
Richardson Electronics	442,500		3,230,250
Rimage Corporation a	97,500		2,069,925	REPURCHASE AGREEMENT – 11.2%
TTM Technologies a	427,500		3,253,275	State Street Bank & Trust Company,
				2.55% dated 6/30/05, due 7/1/05,
			23,709,166	maturity value $66,677,723
				(collateralized by obligations of various
Distribution - 0.2%				U.S. Government Agencies, valued at
Jaco Electronics a,c	382,250		1,131,460	$68,342,732)
Nu Horizons Electronics a	55,000		352,000	(Cost $66,673,000)		66,673,000
			1,483,460	COLLATERAL RECEIVED FOR SECURITIES LOANED – 1.8%
				U.S. Treasury Bonds
Internet Software and Services - 0.2%				5.25%-9.25% due 2/15/16-5/15/30		5,405,905
Inforte Corporation	357,800		1,187,896	U.S. Treasury Notes
				2.875%-4.75% due 11/30/06-7/15/09		4,159,077
IT Services - 1.0%				U.S. Treasury Strip-Interest
answerthink a	325,300		1,154,815	due 8/15/06-8/15/15		1,142,972
Forrester Research a	277,800		4,953,174	U.S. Treasury Strip-Principal
				7.25%-9.875% due 11/15/15-5/15/16		189,885
			6,107,989
				(Cost $10,897,839)		10,897,839
Semiconductors and Equipment - 2.7%
Cascade Microtech a	174,500		2,547,700	TOTAL INVESTMENTS – 101.6%
CEVA a	418,900		2,454,754	(Cost $515,734,610)		608,647,290
ESS Technology a	717,900		3,022,359
PDF Solutions a	171,900		2,255,328	LIABILITES LESS CASH AND OTHER ASSETS – (1.6)%		(9,359,705	)
Semitool a	329,300		3,141,522
White Electronic Designs a	459,600		2,550,780	NET ASSETS – 100.0%	$	599,287,585
			15,972,443
Software - 3.5%
InterVideo a	125,000		1,797,500
iPass a	569,000		3,448,140
Kongzhong Corporation ADR a,b	172,700		1,580,205
PLATO Learning a	734,925		5,423,746
SCO Group (The) a,d	493,100		1,888,573
SPSS a	72,100		1,385,041
Tengtu International a	2,772,800		471,376
Transaction Systems Architects Cl. A a	193,300		4,760,979
			20,755,560
Telecommunications - 2.2%
Anaren a	192,900		2,536,635
Atlantic Tele-Network	75,000		2,160,000
Brooktrout a	204,300		2,279,988
Captaris a	304,000		1,258,560
Globecomm Systems a	375,800		2,258,558
KVH Industries a	96,400		891,700
PC-Tel a	244,100		1,911,303
			13,296,744
Total (Cost $86,337,366)			91,020,335

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
THE ROYCE FUNDS SEMIANNUAL REPORT  2005  |  25

SCHEDULES OF INVESTMENTS

      Royce Premier Fund

	SHARES		VALUE		SHARES		VALUE
COMMON STOCKS – 86.6%				Medical Products and Devices - 2.9%
				Arrow International	1,665,825	$	53,139,818
Consumer Products – 11.9%				Viasys Healthcare a,c	1,981,900		44,771,121
Apparel and Shoes - 4.6%
Polo Ralph Lauren Cl. A	1,689,100	$	72,817,101				97,910,939
Timberland Company Cl. A a	2,068,600		80,096,192
				Total (Cost $223,343,304)			282,375,803
			152,913,293
				Industrial Products – 14.8%
Home Furnishing and Appliances - 0.8%				Automotive - 1.1%
Ethan Allen Interiors	811,700		27,200,067	Adesa	1,785,000		38,859,450
Sports and Recreation - 4.3%				Building Systems and Components - 2.5%
Thor Industries	2,254,800		70,868,364	Simpson Manufacturing c	2,763,400		84,421,870
Winnebago Industries c	2,244,500		73,507,375
				Construction Materials - 2.3%
			144,375,739	Florida Rock Industries	1,042,850		76,493,048
Other Consumer Products - 2.2%				Machinery - 5.2%
Fossil a	1,708,600		38,785,220	Lincoln Electric Holdings c	2,769,597		91,812,141
Matthews International Cl. A	876,500		34,148,440	National Instruments	1,304,087		27,646,644
				Woodward Governor Company c	640,604		53,829,954
			72,933,660
							173,288,739
Total (Cost $316,709,339)			397,422,759
				Metal Fabrication and Distribution - 3.7%
Consumer Services – 7.0%				IPSCO	1,966,100		85,918,570
Direct Marketing - 2.7%				Schnitzer Steel Industries Cl. A c	1,552,600		36,796,620
Nu Skin Enterprises Cl. A c	3,856,500		89,856,450
							122,715,190
Retail Stores - 4.3%
Big Lots a	3,722,500		49,285,900	Total (Cost $339,657,012)			495,778,297
Charming Shoppes a	2,471,100		23,055,363
Claire’s Stores	843,700		20,290,985	Industrial Services – 6.1%
Pier 1 Imports	3,554,300		50,435,517	Commercial Services - 1.1%
				West Corporation a	922,400		35,420,160
			143,067,765
				Engineering and Construction - 1.4%
Total (Cost $205,173,532)			232,924,215	Dycom Industries a	2,358,300		46,717,923
Financial Intermediaries – 8.6%				Industrial Distribution - 2.0%
Insurance - 6.5%				Ritchie Bros. Auctioneers c	1,776,200		68,472,510
Alleghany Corporation a	300,186		89,155,242
Erie Indemnity Company Cl. A	1,249,200		67,769,100	Transportation and Logistics - 1.6%
ProAssurance Corporation a	827,500		34,556,400	EGL a,c	2,693,600		54,733,952
Wesco Financial	73,400		26,424,000
				Total (Cost $139,595,450)			205,344,545
			217,904,742
				Natural Resources – 14.8%
Other Financial Intermediaries - 2.1%				Energy Services - 6.4%
TSX Group	2,284,000		68,061,410	Ensign Energy Services c	4,119,900		99,433,107
				Trican Well Service a,c	4,635,400		113,955,475
Total (Cost $188,092,898)			285,966,152
							213,388,582
Financial Services – 2.5%
Information and Processing - 1.7%				Oil and Gas - 3.6%
FactSet Research Systems	56,350		2,019,584	Cimarex Energy a	1,197,200		46,583,052
Fair Isaac	813,000		29,674,500	Unit Corporation a	1,691,700		74,451,717
Interactive Data	1,259,100		26,164,098
							121,034,769
			57,858,182
				Precious Metals and Mining - 4.8%
Investment Management - 0.8%				Glamis Gold a	4,601,100		79,184,931
†Federated Investors Cl. B	834,700		25,049,347	Goldcorp	1,442,100		22,756,338
				Meridian Gold a	3,246,900		58,444,200
Total (Cost $71,677,535)			82,907,529
							160,385,469
Health – 8.4%
Commercial Services - 0.9%				Total (Cost $326,744,593)			494,808,820
IDEXX Laboratories a	500,200		31,177,466
				Technology – 12.0%
Drugs and Biotech - 4.6%				Aerospace and Defense - 0.7%
Endo Pharmaceuticals Holdings a	4,064,150		106,805,862	Curtiss-Wright	451,900		24,380,005
Perrigo Company	3,334,400		46,481,536
			153,287,398

26  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

JUNE 30, 2005 (Unaudited)
	Royce Low-Priced Stock Fund

	SHARES		VALUE			SHARES		VALUE
Technology (continued)					COMMON STOCKS – 91.8%
Components and Systems - 2.9%
Dionex Corporation a	967,500	$	42,192,675		Consumer Products – 10.1%
†Tektronix	1,469,400		34,192,938		Apparel and Shoes - 1.7%
Zebra Technologies Cl. A a	491,400		21,518,406		K-Swiss Cl. A	827,000	$	26,745,180
					Steven Madden a	616,000		10,940,160
			97,904,019		Polo Ralph Lauren Cl. A	250,000		10,777,500
					Stride Rite	1,373,200		18,936,428
Distribution - 0.6%
Arrow Electronics a	709,100		19,259,156					67,399,268
IT Services - 3.9%					Collectibles - 0.7%
Gartner Cl. A a	2,898,600		30,783,132		Topps Company (The) c	2,604,616		26,124,298
Keane a	1,462,200		20,032,140
MAXIMUS	732,600		25,853,454		Food/Beverage/Tobacco - 0.4%
Perot Systems Cl. A a	3,770,900		53,622,198		Boston Beer Company Cl. A a	242,800		5,448,432
					CoolBrands International a,c	3,331,600		11,203,226
			130,290,924
								16,651,658
Semiconductors and Equipment - 2.8%
Cabot Microelectronics a,c,d	1,731,300		50,190,387		Home Furnishing and Appliances - 1.8%
Cognex Corporation	1,651,000		43,239,690		La-Z-Boy	800,900		11,669,113
					Natuzzi ADR b	2,718,800		22,131,032
			93,430,077		Select Comfort a,c	1,843,400		39,504,062
Telecommunications - 1.1%								73,304,207
†Foundry Networks a	4,349,500		37,536,185
					Publishing - 0.5%
Total (Cost $339,111,635)			402,800,366		Journal Communications Cl. A	1,117,200		18,768,960
Miscellaneous – 0.5%					Sports and Recreation - 3.6%
Total (Cost $14,688,798)			16,659,247		Arctic Cat c	1,398,360		28,708,331
					Callaway Golf Company	3,444,400		53,147,092
TOTAL COMMON STOCKS					Monaco Coach	865,650		14,880,524
(Cost $2,164,794,096)			2,896,987,733		Oakley	2,123,300		36,159,799
					Sturm, Ruger & Company	991,800		8,301,366
REPURCHASE AGREEMENT – 13.5%
State Street Bank & Trust Company,								141,197,112
2.55% dated 6/30/05, due 7/1/05,
maturity value $452,591,056					Other Consumer Products - 1.4%
(collateralized by obligations of various					Fossil a	1,594,000		36,183,800
U.S. Government Agencies, valued at					Leapfrog Enterprises a,d	1,738,000		19,639,400
$463,876,220)
(Cost $452,559,000)			452,559,000					55,823,200
COLLATERAL RECEIVED FOR SECURITIES LOANED – 0.1%					Total (Cost $381,181,774)			399,268,703
U.S. Treasury Bonds
5.25%-6.375% due 8/15/27-2/15/29			194,592		Consumer Services – 10.5%
					Direct Marketing - 1.9%
(Cost $194,592)			194,592		Nu Skin Enterprises Cl. A	3,298,500		76,855,050
TOTAL INVESTMENTS – 100.2%					Leisure and Entertainment - 0.9%
(Cost $2,617,547,688)			3,349,741,325		4Kids Entertainment a	589,100		11,711,308
					Multimedia Games a,c,d	1,452,438		15,991,342
LIABILITES LESS CASH AND OTHER ASSETS – (0.2)%			(7,692,798	)	New Frontier Media a,c	1,159,500		7,710,675
NET ASSETS – 100.0%		$	3,342,048,527					35,413,325
					Restaurants and Lodgings - 1.5%
					Applebee’s International	551,000		14,595,990
					Ruby Tuesday	843,500		21,846,650
					Ryan’s Restaurant Group a	1,438,900		20,158,989
					Steak n Shake Company (The) a	193,000		3,593,660
								60,195,289
					Retail Stores - 5.5%
					AnnTaylor Stores a	805,000		19,545,400
					Big Lots a	2,459,700		32,566,428
					Buckle (The)	612,500		27,158,250
					Cache a,c	1,067,800		17,746,836
					Cato Corporation Cl. A	888,750		18,352,687
					Charming Shoppes a	2,822,300		26,332,059
					Circuit City Stores	716,300		12,384,827
					Claire’s Stores	1,317,200		31,678,660

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
THE ROYCE FUNDS SEMIANNUAL REPORT  2005  |  27

SCHEDULES OF INVESTMENTS

      Royce Low-Priced Stock Fund (continued)

	SHARES		VALUE		SHARES		VALUE
Consumer Services (continued)				Perrigo Company	4,257,800	$	59,353,732
Retail Stores (continued)				QLT a,d	2,179,600		22,711,432
Hibbett Sporting Goods a	73,425	$	2,778,402	VIVUS a,c	3,638,300		13,407,136
Pier 1 Imports	2,201,600		31,240,704
							296,316,116
			219,784,253
				Health Services - 0.6%
Other Consumer Services - 0.7%				Cross Country Healthcare a	765,500		13,013,500
Corinthian Colleges a	1,410,000		18,005,700	MedQuist a	750,200		9,752,600
MoneyGram International	405,000		7,743,600
							22,766,100
			25,749,300
				Medical Products and Devices - 2.9%
Total (Cost $338,815,738)			417,997,217	Bioveris Corporation a,c	1,834,100		8,015,017
				Bruker BioSciences a,c	6,009,800		23,979,102
Financial Intermediaries – 4.9%				Caliper Life Sciences a	1,173,200		6,569,920
Banking - 0.1%				CONMED Corporation a	205,500		6,323,235
Bancorp (The) a	245,870		4,287,973	Medical Action Industries a	489,500		8,737,575
				Possis Medical a,c	984,000		9,967,920
Insurance - 3.7%				Thoratec Corporation a	2,354,200		36,113,428
Argonaut Group a	1,330,000		30,709,700	Viasys Healthcare a	777,200		17,556,948
Aspen Insurance Holdings	903,000		24,886,680
CNA Surety a	870,100		12,920,985				117,263,145
NYMAGIC	386,500		9,024,775
Navigators Group a	503,500		17,405,995	Personal Care - 0.2%
Ohio Casualty	610,100		14,752,218	Helen of Troy a	288,100		7,335,026
Phoenix Companies (The)	922,900		10,982,510
PXRE Group	635,800		16,034,876	Total (Cost $450,818,238)			466,598,061
Scottish Re Group	350,000		8,484,000
				Industrial Products – 7.8%
			145,201,739	Automotive - 1.2%
				Adesa	1,984,000		43,191,680
Securities Brokers - 0.3%				LKQ Corporation a	149,100		4,048,065
Knight Capital Group Cl. A a	1,452,300		11,066,526
							47,239,745
Other Financial Intermediaries - 0.8%
TSX Group	1,203,200		35,854,417	Building Systems and Components - 0.2%
				Aaon a	347,500		6,182,025
Total (Cost $138,175,656)			196,410,655
				Industrial Components - 0.2%
Financial Services – 1.6%				Powell Industries a	503,000		9,491,610
Information and Processing - 1.5%
eFunds Corporation a,c	3,524,700		63,409,353	Machinery - 1.3%
				Lincoln Electric Holdings	487,800		16,170,570
Investment Management - 0.1%				Pason Systems c	1,996,400		34,707,248
Cohen & Steers	85,200		1,755,972
							50,877,818
Total (Cost $48,864,962)			65,165,325
				Metal Fabrication and Distribution - 3.6%
Health – 11.8%				Harris Steel Group c	1,584,000		26,632,713
Commercial Services - 0.6%				IPSCO	1,496,600		65,401,420
AMN Healthcare Services a	292,227		4,392,172	Metal Management c	1,883,700		36,449,595
Discovery Partners International a,c	1,885,200		5,391,672	Schnitzer Steel Industries Cl. A	632,200		14,983,140
Hooper Holmes	2,290,900		9,507,235
PAREXEL International a	182,700		3,626,595				143,466,868
			22,917,674	Specialty Chemicals and Materials - 0.6%
				Schulman (A.)	1,356,600		24,269,574
Drugs and Biotech - 7.5%
Abgenix a	785,800		6,742,164	Other Industrial Products - 0.7%
Applera Corporation- Celera				Color Kinetics a	863,900		9,191,896
Genomics Group a	453,400		4,973,798	Steelcase Cl. A	1,291,500		17,887,275
Cell Genesys a,c,d	3,016,600		16,138,810
Connetics Corporation a	293,200		5,172,048				27,079,171
†Dendreon Corporation a,d	916,000		4,790,680
Elan Corporation ADR a,b,d	5,196,800		35,442,176	Total (Cost $248,077,396)			308,606,811
Endo Pharmaceuticals Holdings a	2,971,900		78,101,532
Exelixis a	607,600		4,514,468	Industrial Services – 6.3%
Human Genome Sciences a	290,700		3,366,306	Commercial Services - 2.2%
Lexicon Genetics a,c	4,033,800		19,926,972	Century Business Services a	1,000,000		4,050,000
Maxygen a	790,200		5,420,772	Copart a	460,143		10,951,403
Myriad Genetics a	1,038,600		16,254,090	Digital Theater Systems a	328,000		5,848,240
				Exponent a	200,200		5,721,716
				FTI Consulting a	883,700		18,469,330
				LECG Corporation a	396,800		8,435,968
				PDI a,c	844,000		10,406,520

28  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

JUNE 30, 2005 (Unaudited)

	SHARES		VALUE		SHARES		VALUE
Industrial Services (continued)				Technology – 17.0%
Commercial Services (continued)				Aerospace and Defense - 0.4%
Spherion Corporation a	619,000	$	4,085,400	Integral Systems c	599,500	$	13,566,685
West Corporation a	496,800		19,077,120
				Components and Systems - 2.5%
			87,045,697	Adaptec a	1,576,300		6,116,044
				†Energy Conversion Devices a,d	490,300		10,972,914
Engineering and Construction - 2.7%				KEMET Corporation a	1,378,800		8,686,440
Dycom Industries a	1,888,400		37,409,204	Methode Electronics	955,700		11,344,159
Insituform Technologies Cl. A a,c	2,644,900		42,397,747	TTM Technologies a	1,834,100		13,957,501
Palm Harbor Homes a,c,d	1,463,300		27,553,939	Technitrol	1,987,100		28,077,723
				Tektronix	907,300		21,112,871
			107,360,890
							100,267,652
Food and Tobacco Processors - 0.3%
Omega Protein a,c	1,672,500		10,570,200	Internet Software and Services - 0.4%
				RealNetworks a	3,430,900		17,051,573
Printing - 0.2%
Ennis	472,500		8,561,700	IT Services - 3.2%
				CIBER a	323,700		2,583,126
Transportation and Logistics - 0.9%				Forrester Research a,c	1,238,600		22,084,238
Heartland Express	800,000		15,544,000	MAXIMUS	237,900		8,395,491
Knight Transportation	50,000		1,216,500	Perot Systems Cl. A a	4,878,800		69,376,536
Werner Enterprises	975,000		19,149,000	Syntel	1,552,400		24,884,972
			35,909,500				127,324,363
Total (Cost $213,976,269)			249,447,987	Semiconductors and Equipment - 4.2%
				Catalyst Semiconductor a	496,200		2,178,318
Natural Resources – 19.5%				CEVA a,c	1,306,800		7,657,848
Energy Services - 6.4%				Cognex Corporation	70,000		1,833,300
Core Laboratories a	257,500		6,906,150	Credence Systems a	2,425,000		21,946,250
Dril-Quip a	287,400		8,337,474	DSP Group a	120,000		2,864,400
Ensign Energy Services	3,177,300		76,683,612	ESS Technology a,c	2,258,900		9,509,969
Global Industries a	1,302,350		11,069,975	Entegris a	1,915,300		18,961,470
Input/Output a,c,d	6,652,900		41,780,212	Exar Corporation a,c	3,106,850		46,260,996
Maverick Tube a	532,900		15,880,420	Fairchild Semiconductor
Oil States International a	836,200		21,047,154	International Cl. A a	1,092,500		16,114,375
Patterson-UTI Energy	177,000		4,925,910	Helix Technology	446,400		5,928,192
Tesco Corporation a,c	2,227,700		24,371,038	LTX Corporation a	1,247,600		6,188,096
TETRA Technologies a	339,800		10,822,630	MKS Instruments a	100,000		1,689,000
Total Energy Services Trust c	2,155,700		17,805,815	OmniVision Technologies a	463,400		6,297,606
Veritas DGC a	556,300		15,431,762	Semitool a,c	1,771,233		16,897,563
			255,062,152				164,327,383
Oil and Gas - 2.5%				Software - 4.0%
Remington Oil & Gas a	50,000		1,785,000	iPass a,c	3,190,600		19,335,036
St. Mary Land & Exploration Company	628,000		18,199,440	Kongzhong Corporation ADR a,b	724,700		6,631,005
Unit Corporation a	1,748,900		76,969,089	ManTech International Cl. A a	1,233,700		38,294,048
				PLATO Learning a	976,400		7,205,832
			96,953,529	SPSS a	183,972		3,534,102
				THQ a	684,000		20,020,680
Precious Metals and Mining - 10.6%				Transaction Systems Architects Cl. A a,c	2,561,000		63,077,430
African Platinum a	14,107,468		5,623,989
Agnico-Eagle Mines	3,535,000		44,541,000				158,098,133
Apex Silver Mines a,d	1,897,000		26,064,780
Eldorado Gold a	5,270,100		14,071,167	Telecommunications - 2.3%
Gammon Lake Resources a	3,005,800		20,229,034	CommScope a	1,050,700		18,292,687
Glamis Gold a	4,384,000		75,448,640	Foundry Networks a	4,217,800		36,399,614
Goldcorp	675,000		10,651,500	KVH Industries a,c,d	1,202,200		11,120,350
Golden Star Resources a,d	4,685,000		14,523,500	PC-Tel a,c	1,358,600		10,637,838
Hecla Mining Company a,c	11,741,500		53,541,240	Premiere Global Services a	500,000		5,645,000
Meridian Gold a	4,236,600		76,258,800	ViaSat a	513,300		10,435,389
Minefinders Corporation a,c	2,174,300		10,045,266
Northern Orion Resources a,c,d	8,832,600		21,639,870				92,530,878
Silver Standard Resources a,c,d	3,351,700		39,181,373
Stillwater Mining Company a	935,556		6,941,826	Total (Cost $641,150,879)			673,166,667
			418,761,985
Total (Cost $600,709,800)			770,777,666

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
THE ROYCE FUNDS SEMIANNUAL REPORT  2005  |  29

SCHEDULES OF INVESTMENTS
Royce Low-Priced Stock Fund (continued)	Royce Total Return Fund

		VALUE			SHARES		VALUE
Miscellaneous – 2.3%				COMMON STOCKS – 85.9%
Total (Cost $86,381,967)	$	91,320,912
				Consumer Products – 6.2%
TOTAL COMMON STOCKS				Apparel and Shoes - 2.1%
(Cost $3,148,152,679)		3,638,760,004		Kenneth Cole Productions Cl. A	134,700	$	4,191,864
				Cutter & Buck	533,141		6,877,519
REPURCHASE AGREEMENT – 8.5%				Delta Apparelc	763,460		9,871,538
State Street Bank & Trust Company, 2.55% dated 6/30/05, due 7/1/05, maturity value $336,254,816 (collateralized by obligations of various U.S. Government Agencies, valued at $344,641,646) (Cost $336,231,000)		336,231,000		Haggar	38,212		777,614
				Jones Apparel Group	492,000		15,271,680
				K-Swiss Cl. A	173,600		5,614,224
				Oshkosh B’Gosh Cl. A	333,400		8,665,066
COLLATERAL RECEIVED FOR SECURITIES LOANED – 1.6%				Polo Ralph Lauren Cl. A	511,300		22,042,143
U.S. Treasury Bills				Reebok International	121,400		5,078,162
due 9/15/05		66,894		Saucony Cl. B	144,837		3,302,284
U.S. Treasury Bonds				Stride Rite	290,600		4,007,374
5.25%-11.25% due 2/15/15-5/15/30		41,098,061		Timberland Company Cl. Aa	386,000		14,945,920
U.S. Treasury Notes				Wolverine World Wide	315,000		7,563,150
1.625%-4.75% due 9/30/05-8/15/14		20,532,448
U.S. Treasury Strip-Interest							108,208,538
due 8/15/06-8/15/15		2,007,010
U.S. Treasury Strip-Principal				Collectibles - 0.3%
7.25%-9.875% due 11/15/15-5/15/16		584,670		Action Performance Companiesa	639,100		5,636,862
				Russ Berrie & Company	669,000		8,569,890
(Cost $64,289,083)		64,289,083
							14,206,752
TOTAL INVESTMENTS – 101.9%
(Cost $3,548,672,762)		4,039,280,087		Food/Beverage/Tobacco - 0.5%
				Hershey Creamery Company	173		389,250
LIABILITES LESS CASH AND OTHER ASSETS – (1.9)%		(74,646,723	)	Lancaster Colony	231,300		9,927,396
				J.M. Smucker Company (The)	255,200		11,979,088
NET ASSETS – 100.0%	$	3,964,633,364		Tootsie Roll Industries	218,205		6,382,496
							28,678,230
				Home Furnishing and Appliances - 1.6%
				American Woodmark	108,680		3,261,487
				Ethan Allen Interiors	598,000		20,038,980
				Fedders Corporation	1,536,400		3,380,080
				Flexsteel Industries	225,676		3,175,261
				Furniture Brands International	346,300		7,483,543
				Hooker Furniture	85,735		1,497,790
				La-Z-Boy	1,457,300		21,232,861
				Lifetime Brands	264,995		5,175,352
				Natuzzi ADRb	1,211,200		9,859,168
				Stanley Furniture Company	209,020		5,133,531
							80,238,053
				Publishing - 0.4%
				Journal Communications Cl. A	692,450		11,633,160
				Reader’s Digest Association	436,100		7,195,650
							18,828,810
				Sports and Recreation - 0.8%
				Callaway Golf Company	1,168,300		18,026,869
				Monaco Coach	185,800		3,193,902
				Sturm, Ruger & Company	556,400		4,657,068
				Thor Industries	95,200		2,992,136
				Winnebago Industries	309,600		10,139,400
							39,009,375
				Other Consumer Products - 0.5%
				Blyth	254,100		7,127,505
				Burnham Holdings Cl. A	93,412		2,335,300
				Matthews International Cl. A	255,600		9,958,176
				Radica Games	72,400		626,839
				Starrett (L.S.) Company Cl. A	318,000		5,800,320
							25,848,140
				Total (Cost $305,304,230)			315,017,898

30  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

JUNE 30, 2005 (Unaudited)

	SHARES		VALUE		SHARES		VALUE
Consumer Services – 6.1%				Central Pacific Financial	20,000	$	712,000
Direct Marketing - 0.2%				Chittenden Corporation	240,625		6,545,000
Nu Skin Enterprises Cl. A	535,000	$	12,465,500	Fauquier Bankshares c	213,300		5,545,800
				First National Bank Alaska	980		2,165,800
Leisure and Entertainment - 0.2%				HopFed Bancorp	56,000		879,760
Dover Downs Gaming & Entertainment	217,100		2,878,746	IndyMac Bancorp	34,000		1,384,820
International Speedway Cl. A	110,000		6,188,600	International Bancshares	131,556		3,721,726
Regal Entertainment Group Cl. A	250,100		4,721,888	Mercantile Bankshares	237,500		12,238,375
				†Ocwen Financial a, d	240,000		1,622,400
			13,789,234	Oriental Financial Group	130,248		1,987,584
				Park National	62,370		6,891,885
Media and Broadcasting - 0.1%				Partners Trust Financial Group	728,100		7,776,108
Nelson (Thomas)	42,900		933,504	Peapack-Gladstone Financial	236,691		6,556,341
				R &G Financial Cl. B	38,400		679,296
Restaurants and Lodgings - 1.8%				Sterling Bancorp	262,250		5,599,038
Bob Evans Farms	783,000		18,259,560	Susquehanna Bancshares	343,500		8,446,665
CBRL Group	281,700		10,946,862	Timberland Bancorp	134,600		3,021,770
CEC Entertainment a	327,800		13,797,102	Wilmington Trust	510,300		18,375,903
IHOP Corporation	367,000		15,924,130
Landry’s Restaurants	40,600		1,221,654				173,327,873
Lone Star Steakhouse & Saloon	424,800		12,918,168
Ruby Tuesday	580,000		15,022,000	Insurance - 8.3%
Ryan’s Restaurant Group a	161,600		2,264,016	Alleghany Corporation a	94,044		27,931,068
				American Financial Group	324,100		10,863,832
			90,353,492	American National Insurance	155,493		17,833,492
				AmerUs Group	66,500		3,195,325
Retail Stores - 3.5%				Argonaut Group a	318,000		7,342,620
AnnTaylor Stores a	63,700		1,546,636	Aspen Insurance Holdings	487,100		13,424,476
Big Lots a	549,500		7,275,380	Assured Guaranty	177,700		4,151,072
Borders Group	541,600		13,707,896	Baldwin & Lyons Cl. B	494,911		11,927,355
Buckle (The)	112,600		4,992,684	CNA Surety a	447,000		6,637,950
Cato Corporation Cl. A	453,750		9,369,937	Capital Title Group	486,374		3,307,343
Claire’s Stores	670,800		16,132,740	Commerce Group	464,300		28,837,673
Deb Shops	466,388		13,511,260	Endurance Specialty Holdings	94,400		3,570,208
Dress Barn (The)a	1,032,676		23,369,458	Erie Indemnity Company Cl. A	457,200		24,803,100
Finish Line (The) Cl. A	30,300		573,276	Fidelity National Financial	93,643		3,342,119
Friedman’s Cl. A a, d	42,800		43,228	First American	99,000		3,973,860
Movie Gallery	93,400		2,468,562	Horace Mann Educators	437,200		8,228,104
Neiman Marcus Group (The) Cl. A	188,100		18,230,652	Hub International	381,000		7,425,690
Payless ShoeSource a	829,300		15,922,560	IPC Holdings	279,300		11,065,866
Pep Boys- Manny, Moe & Jack	415,000		5,619,100	Independence Holding	379,924		6,705,659
Pier 1 Imports	1,213,400		17,218,146	Infinity Property & Casualty	211,800		7,387,584
Talbots	271,800		8,825,346	LandAmerica Financial Group	78,700		4,672,419
Tiffany & Co.	476,200		15,600,312	Leucadia National	463,200		17,893,416
Weis Markets	57,800		2,242,062	Markel Corporation a	53,800		18,238,200
				Montpelier Re Holdings	190,100		6,573,658
			176,649,235	NYMAGIC	167,000		3,899,450
				Ohio Casualty	377,700		9,132,786
Other Consumer Services - 0.3%				PartnerRe	2,600		167,492
Ambassadors Group	38,349		1,426,199	Phoenix Companies (The)	269,600		3,208,240
Jackson Hewitt Tax Service	113,200		2,676,048	PXRE Group	262,124		6,610,767
MoneyGram International	545,500		10,429,960	Protective Life	232,000		9,795,040
				RLI	438,400		19,552,640
			14,532,207	Reinsurance Group of America	163,600		7,609,036
				Safety Insurance Group	81,555		2,753,297
Total (Cost $264,287,117)			308,723,172	Scottish Re Group	447,900		10,857,096
				Selective Insurance Group	96,438		4,778,503
Financial Intermediaries – 14.7%				Stewart Information Services	19,600		823,200
Banking - 3.4%				Transatlantic Holdings	272,850		15,230,487
Abigail Adams National Bancorp c	244,400		3,971,500	21st Century Insurance Group	370,100		5,492,284
Anchor BanCorp Wisconsin	266,200		8,055,212	UICI	49,100		1,461,707
Arrow Financial	265,038		7,378,658
BOK Financial	452,675		20,877,371
Bancorp Rhode Island	203,200		7,437,120
Bank of Hawaii	191,700		9,728,775
Bank of NT Butterfield	121,900		5,058,850
Boston Private Financial Holdings	258,500		6,514,200
Canadian Western Bank	431,600		10,155,916

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  31

SCHEDULES OF INVESTMENTS

      Royce Total Return Fund (continued)

	SHARES		VALUE		SHARES		VALUE
Financial Intermediaries (continued)				Other Financial Services - 0.4%
Insurance (continued)				American Capital Strategies	55,200	$	1,993,272
United Fire & Casualty Company	542,046	$	24,077,683	Fremont General	34,100		829,653
Wesco Financial	29,930		10,774,800	GATX Corporation	383,500		13,230,750
Willis Group Holdings	197,000		6,445,840	London Stock Exchange	652,629		5,747,187
Zenith National Insurance	262,500		17,813,250
							21,800,862
			419,815,687
				Total (Cost $313,998,408)			387,709,156
Real Estate Investment Trusts - 1.5%
Captial Trust Cl. A	74,600		2,492,386	Health – 4.4%
Cousins Properties	223,500		6,611,130	Commercial Services - 0.8%
Essex Property Trust	83,000		6,893,980	Hooper Holmes	2,566,608		10,651,423
Gladstone Commercial	4,700		74,072	IDEXX Laboratories a	156,500		9,754,645
PS Business Parks	168,500		7,489,825	Owens & Minor	671,300		21,716,555
Public Storage	195,000		12,333,750
Rayonier	471,357		24,996,062				42,122,623
Vornado Realty Trust	183,100		14,721,240
				Drugs and Biotech - 0.2%
			75,612,445	Perrigo Company	607,500		8,468,550
Securities Brokers - 0.6%				Health Services - 0.5%
First Albany	206,100		1,228,356	Healthcare Services Group	179,292		3,600,183
Friedman, Billings, Ramsey Group Cl. A	520,200		7,438,860	Health Management Associates Cl. A	50,000		1,309,000
Piper Jaffray Companies a	311,000		9,463,730	NDCHealth Corporation a	20,900		375,573
Raymond James Financial	334,350		9,445,387	Omnicare	38,800		1,646,284
				Option Care	102,010		1,438,341
			27,576,333	PolyMedica Corporation	422,900		15,080,614
				Universal Health Services Cl. B	78,500		4,881,130
Other Financial Intermediaries - 0.9%
Student Loan	71,900		15,803,620				28,331,125
TSX Group	1,052,400		31,360,695
				Medical Products and Devices - 2.4%
			47,164,315	Applera Corporation- Applied Biosystems Group	548,400		10,787,028
				Arrow International	542,100		17,292,990
Total (Cost $565,190,377)			743,496,653	Datascope	482,734		16,099,179
				Diagnostic Products	261,300		12,367,329
Financial Services – 7.7%				Invacare Corporation	505,500		22,423,980
Information and Processing - 1.2%				Mentor Corporation	439,400		18,226,312
Fair Isaac	282,000		10,293,000	STERIS Corporation	382,400		9,854,448
Interactive Data	612,900		12,736,062	Vital Signs	314,965		13,644,284
Investors Financial Services	253,000		9,568,460	Young Innovations	5,250		195,983
SEI Investments	686,100		25,625,835
SS&C Technologies	22,800		722,304				120,891,533
			58,945,661	Personal Care - 0.5%
				Alberto-Culver Company	219,600		9,515,268
Insurance Brokers - 1.1%				CNS	155,756		3,559,025
Brown & Brown	444,300		19,966,842	Inter Parfums	181,300		3,515,407
Gallagher (Arthur J.) & Company	828,200		22,469,066	Regis	179,500		7,014,860
Hilb Rogal & Hobbs Company	357,300		12,291,120
							23,604,560
			54,727,028
				Total (Cost $175,743,702)			223,418,391
Investment Management - 5.0%
A.F.P. Provida ADR b	332,000		8,446,080	Industrial Products – 17.9%
Alliance Capital Management Holding L.P.	1,322,100		61,794,954	Automotive - 1.4%
BlackRock Cl. A	106,000		8,527,700	Adesa	563,500		12,267,395
C.I. Fund Management	964,300		13,891,524	Bandag	166,300		7,658,115
Cohen & Steers	746,100		15,377,121	Bandag Cl. A	202,400		8,197,200
Federated Investors Cl. B	1,021,100		30,643,211	CLARCOR	1,032,800		30,209,400
Gabelli Asset Management Cl. A	326,600		14,432,454	Strattec Security a	48,100		2,619,526
IGM Financial	545,600		16,766,112	Superior Industries International	293,900		6,965,430
Janus Capital Group	695,000		10,452,800	Wescast Industries Cl. A	97,400		2,213,902
National Financial Partners	150,000		5,871,000
Nuveen Investments Cl. A	856,800		32,232,816				70,130,968
T. Rowe Price Group	411,400		25,753,640
W.P. Stewart & Co.	332,900		8,046,193	Building Systems and Components - 0.9%
				International Aluminum	12,800		408,960
			252,235,605	LSI Industries	739,737		10,311,934

32  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

JUNE 30, 2005 (Unaudited)

	SHARES		VALUE		SHARES		VALUE
Industrial Products (continued)				Schnitzer Steel Industries Cl. A	273,500	$	6,481,950
Building Systems and Components (continued)				Steel Dynamics	20,600		540,750
Preformed Line Products Company c	345,894	$	14,112,475	Steel Technologies	57,800		976,820
Simpson Manufacturing	130,800		3,995,940
Teleflex	259,700		15,418,389				64,060,795
			44,247,698	Paper and Packaging - 1.0%
				AptarGroup	385,400		19,578,320
Construction Materials - 1.4%				Bemis Company	543,500		14,424,490
Ameron International	232,500		8,695,500	Louisiana-Pacific Corporation	20,100		494,058
Ash Grove Cement Company	39,610		6,218,770	Schweitzer-Mauduit International	227,000		7,066,510
Building Materials Holding	32,800		2,272,712	Sonoco Products Company	349,500		9,261,750
Florida Rock Industries	358,000		26,259,300
Martin Marietta Materials	123,300		8,522,496				50,825,128
NCI Building Systems a	50,000		1,640,000
Vulcan Materials Company	286,600		18,626,134	Pumps, Valves and Bearings - 1.1%
				Baldor Electric	247,500		6,019,200
			72,234,912	Franklin Electric	502,500		19,421,625
				Gorman-Rupp Company	295,237		6,321,024
Industrial Components - 2.1%				Roper Industries	163,000		11,633,310
AMETEK	520,900		21,799,665	Sun Hydraulics	326,450		11,879,516
Bel Fuse Cl. B	284,437		8,692,395
Chase Corporation c	273,800		3,833,200				55,274,675
Crane Company	259,800		6,832,740
Deswell Industries c	740,043		11,529,796	Specialty Chemicals and Materials - 2.1%
Donaldson Company	638,000		19,350,540	Albemarle Corporation	220,500		8,041,635
PerkinElmer	335,500		6,340,950	Arch Chemicals	249,700		6,232,512
Precision Castparts	196,200		15,283,980	Balchem Corporation	326,400		9,808,320
Watts Water Technologies Cl. A	228,300		7,645,767	Cabot Corporation	318,000		10,494,000
Woodhead Industries	339,700		4,283,617	Great Lakes Chemical	214,000		6,734,580
				Lubrizol Corporation	400,900		16,841,809
			105,592,650	MacDermid	588,300		18,331,428
				Methanex Corporation	1,016,969		16,749,479
Machinery - 4.2%				Quaker Chemical	405,000		7,067,250
Alamo Group	170,000		3,173,900	RPM International	262,000		4,784,120
Ampco-Pittsburgh	144,800		1,737,600	Schulman (A.)	208,600		3,731,854
Badger Meter	72,700		3,002,510
Briggs & Stratton	358,300		12,404,346				108,816,987
Cascade Corporation	174,500		7,547,125
Graco	563,200		19,188,224	Textiles - 0.1%
Hardinge c	482,700		6,781,935	UniFirst Corporation	12,100		490,534
IDEX Corporation	375,900		14,513,499
Lincoln Electric Holdings	609,000		20,188,350	Other Industrial Products - 2.4%
Lindsay Manufacturing	367,000		8,653,860	Albany International Cl. A	234,300		7,523,373
MTS Systems	161,400		5,419,812	Brady Corporation Cl. A	852,900		26,439,900
Mueller (Paul) Company c	112,700		3,268,300	Diebold	341,000		15,382,510
Nordson Corporation	468,200		16,049,896	HNI Corporation	491,200		25,124,880
Oshkosh Truck	8,600		673,208	Kimball International Cl. B	674,600		8,904,720
Stewart & Stevenson Services	966,000		21,889,560	McGrath RentCorp	200,000		4,740,000
Tecumseh Products Company Cl. A	199,800		5,482,512	Herman Miller	227,700		7,022,268
Tennant	263,800		9,341,158	Quixote Corporation c	442,900		8,685,269
Thomas Industries	427,300		17,074,908	Raven Industries	186,313		4,363,450
Toro Company (The)	452,900		17,486,469	Smith (A.O.) Corporation	212,900		5,686,559
Woodward Governor Company	258,800		21,746,964	Trinity Industries	256,400		8,212,492
			215,624,136				122,085,421
Metal Fabrication and Distribution - 1.2%				Total (Cost $666,770,229)			909,383,904
Commercial Metals Company	25,600		609,792
Gibraltar Industries	749,869		13,902,571	Industrial Services – 9.9%
IPSCO	76,400		3,338,680	Commercial Services - 3.1%
Kaydon Corporation	684,000		19,049,400	ABM Industries	834,900		16,280,550
Mueller Industries	128,000		3,468,800	ALLETE	194,900		9,725,510
Quanex Corporation	249,700		13,236,597	Brink’s Company (The)	421,510		15,174,360
Reliance Steel & Aluminum	13,700		507,859	Chemed Corporation a	370,400		15,141,952
Roanoke Electric Steel	117,892		1,947,576	Hillenbrand Industries	269,200		13,608,060
				Kelly Services Cl. A	552,800		15,832,192
				MPS Group a	604,000		5,689,680
				Manpower	345,200		13,732,056

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  33

SCHEDULES OF INVESTMENTS

      Royce Total Return Fund (continued)

	SHARES		VALUE		SHARES		VALUE
Industrial Services (continued)				Natural Resources – 9.1%
Commercial Services (continued)				Energy Services - 2.8%
Reynolds & Reynolds Company Cl. A	715,700	$	19,345,371	Carbo Ceramics	169,300	$	13,367,928
Rollins	370,500		7,424,820	Ensign Energy Services	312,500		7,542,136
ServiceMaster Company (The)	677,000		9,071,800	Enterprise Products Partners L.P.	263,400		7,056,486
Watson Wyatt & Company Holdings	638,600		16,367,318	Gulf Island Fabrication	134,215		2,668,194
				Helmerich & Payne	545,800		25,608,936
			157,393,669	Lufkin Industries	331,369		11,922,657
				Nicor	371,700		15,302,889
Engineering and Construction - 0.9%				Piedmont Natural Gas Company	585,800		14,070,916
Chicago Bridge & Iron Company	244,200		5,582,412	Precision Drilling a	330,900		13,063,932
EMCOR Group a	262,700		12,846,030	Tidewater	420,700		16,037,084
Granite Construction	222,700		6,257,870	Universal Compression Holdings a	354,400		12,843,456
M.D.C. Holdings	73,187		6,019,631	Western Gas Resources	51,900		1,811,310
M/I Homes	6,400		346,240
Ryland Group (The)	76,800		5,826,816				141,295,924
Skyline Corporation	157,100		6,273,003
Standard Pacific	31,700		2,788,015	Oil and Gas - 4.7%
				Alliance Resource Partners L.P.	100,000		7,400,000
			45,940,017	Berry Petroleum Company Cl. A	207,500		10,972,600
				Chesapeake Energy	913,800		20,834,640
Food and Tobacco Processors - 1.1%				Cimarex Energy a	478,800		18,630,108
Corn Products International	194,000		4,609,440	Diamond Offshore Drilling	211,600		11,305,788
Farmer Bros.	366,000		8,147,160	EOG Resources	214,000		12,155,200
Fresh Del Monte Produce	133,300		3,588,436	Energen Corporation	13,800		483,690
Pilgrim’s Pride	85,900		2,931,767	Energy Transfer Partners L.P.	227,200		7,861,120
Sanderson Farms	70,450		3,201,248	EnergySouth c	465,628		12,902,552
Seaboard Corporation	16,002		26,627,328	Husky Energy	266,555		10,601,718
Universal	121,000		5,297,380	Magellan Midstream Partners L.P.	200,000		6,556,000
				Pacific Energy Partners L.P.	238,000		7,554,120
			54,402,759	Penn Virginia	336,200		15,018,054
				PetroKazakhstan Cl. A	134,812		4,931,423
Industrial Distribution - 1.4%				Plains All American Pipeline L.P.	186,000		8,157,960
Central Steel & Wire	7,765		4,495,935	Pogo Producing Company	454,900		23,618,408
Grainger (W.W.)	292,000		15,998,680	St. Mary Land & Exploration Company	496,200		14,379,876
Handleman	13,200		217,932	SEACOR Holdings a	362,000		23,276,600
Lawson Products	309,369		12,009,705	Stone Energy a	276,500		13,520,850
Mine Safety Appliances Company	196,000		9,055,200	Sunoco Logistics Partners L.P.	239,600		9,076,048
Ritchie Bros. Auctioneers	676,740		26,088,327
Watsco	106,600		4,541,160				239,236,755
			72,406,939	Precious Metals and Mining - 0.7%
				AngloGold Ashanti ADR b	31,000		1,107,630
Printing - 0.7%				Gold Fields ADR b	605,000		6,866,750
Banta Corporation	444,700		20,171,592	Goldcorp	1,212,000		19,125,360
CSS Industries	49,757		1,683,777	Lihir Gold ADR a, b	344,000		6,384,640
Courier Corporation	301,996		11,599,666
Ennis	9,300		168,516				33,484,380
John H. Harland Company	107,700		4,092,600
				Real Estate - 0.7%
			37,716,151	St. Joe Company	305,000		24,869,700
				W.P. Carey & Co.	418,500		12,253,680
Transportation and Logistics - 2.2%
Alexander & Baldwin	472,700		21,909,645				37,123,380
Arkansas Best	417,632		13,284,874
C. H. Robinson Worldwide	128,000		7,449,600	Other Natural Resources - 0.2%
EGL a	600,600		12,204,192	Deltic Timber	38,000		1,445,140
Expeditors International of Washington	333,200		16,596,692	Natural Resource Partners L.P.	75,000		4,349,250
Nordic American Tanker Shipping	55,600		2,360,220	Plum Creek Timber Company	177,000		6,425,100
Overseas Shipholding Group	40,900		2,439,685
Sea Containers Cl. A	387,800		6,193,166				12,219,490
SkyWest	164,800		2,996,064
Teekay Shipping	281,200		12,344,680	Total (Cost $320,025,256)			463,359,929
UTI Worldwide	164,200		11,431,604
				Technology – 5.4%
			109,210,422	Aerospace and Defense - 0.6%
				Cubic Corporation	38,300		679,442
Other Industrial Services - 0.5%				Curtiss-Wright	161,800		8,729,110
Landauer c	475,400		24,678,014	EDO Corporation	3,200		95,712
Total (Cost $368,799,082)			501,747,971

34  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

JUNE 30, 2005 (Unaudited)

	SHARES		VALUE			SHARES		VALUE
Technology (continued)				Miscellaneous – 2.8%
Aerospace and Defense (continued)				Total (Cost $137,149,829)			$	140,575,705
Engineered Support Systems	18,450	$	661,064
HEICO Corporation	241,400		5,651,174	TOTAL COMMON STOCKS
HEICO Corporation Cl. A	339,659		6,120,655	(Cost $3,430,026,103)				4,352,366,945
Kaman Corporation Cl. A	368,200		6,642,328
				PREFERRED STOCKS – 0.9%
			28,579,485	Allied Waste Industries Ser. C 6.25% Conv.		41,000		1,888,870
				†Allied Waste Industries Ser. D 6.25% Conv.		28,300		6,990,100
				Central Parking Finance Trust 5.25% Conv.		4,000		80,000
Components and Systems - 2.4%				Fedders Corporation 8.60%		79,975		1,651,484
AVX Corporation	980,600		11,884,872	First Union Real Estate Equity & Mortgage
Adaptec a	1,681,100		6,522,668	Investments Ser. A 8.40% Conv.		24,000		595,200
American Power Conversion	624,600		14,734,314	Fleetwood Capital Trust 6.00% Conv. a		70,000		3,342,500
Analogic Corporation	222,869		11,214,768	†Merrill Lynch & Co. 6.75% Conv.		115,000		4,175,075
Imation Corporation	10,600		411,174	†PNM Resources 6.75% Conv.		35,000		1,873,900
Lowrance Electronics	3,600		75,672	Reinsurance Group of America 5.75% Conv.		94,000		5,597,700
Methode Electronics	1,721,690		20,436,460	Vornado Realty Trust Ser. A 6.50% Conv.		60,300		6,633,000
Nam Tai Electronics	423,540		9,631,300	Vornado Realty Trust Ser. F 6.75%		200,000		5,050,000
Newport Corporation a	489,300		6,781,698	Vornado Realty Trust Ser. G 6.625%		400,000		9,940,000
Richardson Electronics	317,700		2,319,210
Symbol Technologies	703,300		6,941,571	TOTAL PREFERRED STOCKS
Technitrol	910,900		12,871,017	(Cost $42,970,059)				47,817,829
Tektronix	881,000		20,500,870
						PRINCIPAL
			124,325,594			AMOUNT
				CORPORATE BONDS – 0.6%
Distribution - 0.5%				Amkor Technology 9.25%
Agilysys	132,711		2,083,563	Senior Note due 2/15/08	$	1,000,000		962,500
Arrow Electronics a	571,600		15,524,656	†Athena Neurosciences Finance 7.25%
Tech Data a	218,800		8,010,268	Senior Note due 2/21/08		8,900,000		8,277,000
				E*TRADE Financial 6.00%
			25,618,487	Conv. Sub. Note due 2/1/07		2,500,000		2,512,500
				Human Genome Sciences 5.00%
IT Services - 0.6%				Conv. Sub. Note due 2/1/07		2,000,000		1,930,000
Black Box	467,000		16,531,800	Leucadia National 3.75%
MAXIMUS	309,900		10,936,371	Conv. Senior Note due 4/15/14		3,000,000		3,037,500
Syntel	99,908		1,601,525	Level 3 Communications 9.125% d
				Senior Note due 5/1/08		9,250,000		7,804,687
			29,069,696	Level 3 Communications 10.50% d
				Senior Note due 12/1/08		3,000,000		2,520,000
Semiconductors and Equipment - 0.4%				Level 3 Communications 6.00%
Cognex Corporation	418,300		10,955,277	Conv. Sub. Deb. due 9/15/09		5,000,000		2,737,500
Exar Corporation a	565,800		8,424,762	Levi Strauss & Co. 12.25%
				Senior Note due 12/15/12		1,000,000		1,092,500
			19,380,039	Mueller Industries 6.00%
				Sub. Deb. due 11/1/14		1,088,000		1,077,120
Telecommunications - 0.9%
ADTRAN	140,000		3,470,600	TOTAL CORPORATE BONDS
CT Communications	59,717		779,307	(Cost $27,769,881)				31,951,307
Golden Telecom	170,695		5,236,923
Inter-Tel	104,600		1,946,606
North Pittsburgh Systems	708,272		13,853,800
Scientific-Atlanta	534,850		17,794,460
SureWest Communications	198,400		5,088,960
			48,170,656
Total (Cost $250,634,684)			275,143,957
Utilities – 1.7%
Aqua America	446,075		13,266,270
CH Energy Group	224,300		10,907,709
El Paso Electric Company a	316,400		6,470,380
Hawaiian Electric Industries	641,500		17,198,615
MDU Resources Group	33,300		938,061
PNM Resources	638,900		18,406,709
SJW	196,500		9,237,465
Southern Union a	300,000		7,365,000
Total (Cost $62,123,189)			83,790,209

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  35

SCHEDULES OF INVESTMENTS
Royce Total Return Fund (continued)	Royce TrustShares Fund

		PRINCIPAL				SHARES		VALUE
		AMOUNT		VALUE	COMMON STOCKS – 95.9%
GOVERNMENT BONDS – 2.0%					Consumer Products – 3.5%
(Principal Amount shown in Canadian dollars.)					Apparel and Shoes - 2.8%
Canada 3.25%, due 12/1/06	$	24,000,000	$	19,716,161	Delta Apparel	33,400	$	431,862
Canada 4.50%, due 9/1/07		24,000,000		20,231,146	†Gildan Activewear a	13,000		342,550
Canada 4.25%, due 9/1/08		24,000,000		20,288,149	Polo Ralph Lauren Cl. A	16,500		711,315
Canada 5.50%, due 6/1/09		24,000,000		21,252,497
Canada 5.50%, due 6/1/10		24,000,000		21,486,582				1,485,727
TOTAL GOVERNMENT BONDS					Collectibles - 0.7%
(Cost $95,853,819)				102,974,535	†Action Performance Companies a	40,100		353,682
U.S. TREASURY OBLIGATIONS – 4.0%					Total (Cost $1,447,357)			1,839,409
U.S. Treasury Notes
5.625%, due 2/15/06		100,000,000		101,378,900	Consumer Services – 3.6%
3.25%, due 8/15/08		100,000,000		98,753,900	Retail Stores - 1.7%
					Charming Shoppes a	50,000		466,500
TOTAL U.S. TREASURY OBLIGATIONS					†Cost Plus a	18,000		448,920
(Cost $201,502,521)				200,132,800
								915,420
REPURCHASE AGREEMENT – 6.2%
State Street Bank & Trust Company,					Other Consumer Services - 1.9%
2.55% dated 6/30/05, due 7/1/05,					†Coinstar a	17,200		390,268
maturity value $314,843,300					MoneyGram International	31,100		594,632
(collateralized by obligations of various
U.S. Government Agencies, valued at								984,900
$322,694,897)
(Cost $314,821,000)				314,821,000	Total (Cost $1,716,932)			1,900,320
COLLATERAL RECEIVED FOR SECURITIES LOANED – 0.3%					Financial Intermediaries – 2.0%
U.S. Treasury Bonds					Securities Brokers - 2.0%
5.25%-9.00% due 5/15/16-5/15/30				12,140,852	E*TRADE Financial a	77,200		1,080,028
U.S. Treasury Notes
2.875% due 11/30/06				6,406	Total (Cost $669,953)			1,080,028
U.S. Treasury Strip-Interest
due 8/15/06-8/15/15				2,288,259	Financial Services – 13.6%
U.S. Treasury Strip-Principal					Information and Processing - 2.4%
7.25%-9.875% due 11/15/15-5/15/16				354,551	eFunds Corporation a	29,900		537,901
					SEI Investments	20,000		747,000
(Cost $14,790,068)				14,790,068
								1,284,901
TOTAL INVESTMENTS – 99.9%
(Cost $4,127,733,451)				5,064,854,484	Insurance Brokers - 2.6%
CASH AND OTHER ASSETS					Brown & Brown	20,000		898,800
LESS LIABILITIES – 0.1%				4,624,526	Gallagher (Arthur J.) & Company	18,000		488,340
NET ASSETS – 100.0%			$	5,069,479,010				1,387,140
					Investment Management - 6.8%
					Alliance Capital Management Holding L.P.	40,000		1,869,600
					Federated Investors Cl. B	25,000		750,250
					Nuveen Investments Cl. A	25,800		970,596
								3,590,446
					Other Financial Services - 1.8%
					†Morningstar a	33,900		954,285
					Total (Cost $5,711,341)			7,216,772
					Health – 8.7%
					Commercial Services - 2.3%
					†Dendrite International a	46,000		634,800
					First Consulting Group a	117,700		603,683
								1,238,483
					Drugs and Biotech - 3.7%
					Hi-Tech Pharmacal a	6,000		191,160
					†Life Sciences Research a	57,000		681,720
					Par Pharmaceutical Companies a	21,000		668,010
					Perrigo Company	27,900		388,926
								1,929,816

36  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

JUNE 30, 2005 (Unaudited)

	SHARES	VALUE			SHARES	VALUE
Health (continued)				Natural Resources – 4.3%
Health Services - 1.2%				Energy Services - 3.8%
†On Assignment a	125,500	$	624,990	Input/Output a	110,000	$	690,800
				†Maverick Tube a	18,000		536,400
Medical Products and Devices - 0.8%				Universal Compression Holdings a	22,000		797,280
Arrow International	13,500		430,650
							2,024,480
Personal Care - 0.7%
†Helen of Troy a	15,000		381,900	Precious Metals and Mining - 0.5%
				Hecla Mining Company a	50,000		228,000
Total (Cost $4,673,106)			4,605,839
				Total (Cost $2,013,071)			2,252,480
Industrial Products – 18.0%
Automotive - 0.6%				Technology – 30.7%
Adesa	15,000		326,550	Components and Systems - 10.6%
				Checkpoint Systems a	37,400		661,980
Building Systems and Components - 0.8%				†Electro Scientific Industries a	24,000		429,120
†Craftmade International	27,100		439,020	Excel Technology a	34,000		826,200
				KEMET Corporation a	73,000		459,900
Machinery - 5.2%				Lowrance Electronics	26,000		546,520
†Alamo Group	18,300		341,661	Richardson Electronics	56,100		409,530
†Hurco Companies a	31,500		502,740	†SanDisk Corporation a	19,000		450,870
Lincoln Electric Holdings	28,900		958,035	†SimpleTech a	160,500		614,715
†Rofin-Sinar Technologies a	28,300		928,240	Technitrol	42,800		604,764
				Vishay Intertechnology a	51,100		606,557
			2,730,676
							5,610,156
Metal Fabrication and Distribution - 5.3%
†Insteel Industries	40,100		505,260	Distribution - 1.1%
†NN	51,500		653,020	Benchmark Electronics a	19,000		577,980
Oregon Steel Mills a	28,000		481,880
†Roanoke Electric Steel	22,400		370,048	Internet Software and Services - 0.6%
Schnitzer Steel Industries Cl. A	15,000		355,500	†eResearch Technology a	25,000		334,750
†Universal Stainless & Alloy Products a	34,500		419,210
				IT Services - 5.0%
			2,784,918	BearingPoint a	25,000		183,250
				Forrester Research a	30,000		534,900
Specialty Chemicals and Materials - 4.0%				Keane a	33,000		452,100
Aceto Corporation	112,200		839,256	MAXIMUS	8,600		303,494
†MacDermid	23,400		729,144	Perot Systems Cl. A a	50,000		711,000
†OM Group a	22,000		543,180	†Sapient Corporation a	54,800		434,564
			2,111,580				2,619,308
Other Industrial Products - 2.1%				Semiconductors and Equipment - 7.3%
†Brady Corporation Cl. A	10,000		310,000	Cabot Microelectronics a	8,000		231,920
†Imagistics International a	16,000		448,000	†California Micro Devices a	88,000		499,840
†Raven Industries	15,000		351,300	Cognex Corporation	28,500		746,415
				Credence Systems a	60,000		543,000
			1,109,300	†CyberOptics Corporation a	29,900		388,700
				Exar Corporation a	41,600		619,424
Total (Cost $9,204,843)			9,502,044	†Sanmina-SCI Corporation a	100,000		547,000
				Silicon Storage Technology a	76,000		306,280
Industrial Services – 6.8%
Commercial Services - 1.1%							3,882,579
Harsco Corporation	5,000		272,750
MPS Group a	33,000		310,860	Software - 1.9%
RCM Technologies a	2,500		10,600
				Pegasystems a	105,800		624,220
			594,210	Verity a	43,500		381,495
Industrial Distribution - 2.3%							1,005,715
Ritchie Bros. Auctioneers	31,000		1,195,050
				Telecommunications - 4.2%
Transportation and Logistics - 3.4%				†Inter-Tel	31,000		576,910
Atlas Air Worldwide Holdingsa,e	15,000		487,500	Radyne ComStream a	58,000		503,150
EGL a	13,000		264,160	Scientific-Atlanta	16,000		532,320
UTI Worldwide	6,000		417,720	†Yak Communications a	120,400		583,940
†Universal Truckload Services a	37,400		631,686
							2,196,320
			1,801,066
				Total (Cost $15,931,621)			16,226,808
Total (Cost $2,237,714)			3,590,326

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  37

SCHEDULES OF INVESTMENTS

Royce TrustShares Fund (continued)			Royce Opportunity Fund
		VALUE		SHARES		VALUE
Miscellaneous – 4.7%			COMMON STOCKS – 93.6%
Total (Cost $2,386,722)	$	2,508,291	Consumer Products – 3.8%
			Apparel and Shoes - 1.1%
TOTAL COMMON STOCKS			Hartmarx Corporation a,d	262,100	$	2,639,347
(Cost $45,992,660)		50,722,317	Kellwood Company	352,400		9,479,560
			Warnaco Group (The) a	365,500		8,497,875
REPURCHASE AGREEMENT – 2.6%
State Street Bank & Trust Company,						20,616,782
2.55% dated 6/30/05, due 7/1/05,
maturity value $1,410,100			Collectibles - 0.2%
(collateralized by obligations of various			Topps Company (The)	412,100		4,133,363
U.S. Government Agencies, valued at
$1,447,468)			Home Furnishing and Appliances - 1.4%
(Cost $1,410,000)		1,410,000	†American Technology a,d	155,600		894,700
			Bassett Furniture Industries	221,700		4,181,262
TOTAL INVESTMENTS – 98.5%			Furniture Brands International	512,400		11,072,964
(Cost $47,402,660)		52,132,317	La-Z-Boy	696,900		10,153,833
CASH AND OTHER ASSETS LESS LIABILITIES – 1.5%		773,132				26,302,759
NET ASSETS – 100.0%	$	52,905,449	Publishing - 0.7%
			Journal Communications Cl. A	126,200		2,120,160
			Scholastic Corporation a,d	279,000		10,755,450
						12,875,610
			Other Consumer Products - 0.4%
			Cross (A.T.) Company Cl. A a	357,400		1,522,524
			Universal Electronics a	294,200		4,880,778
						6,403,302
			Total (Cost $62,171,845)			70,331,816
			Consumer Services – 6.5%
			Direct Marketing - 0.3%
			Alloy a,d	1,015,600		5,220,184
			Gaiam a,d	146,300		1,018,248
						6,238,432
			Leisure and Entertainment - 1.0%
			Orient-Express Hotels Cl. A	249,700		7,907,999
			Steinway Musical Instruments a	295,400		8,672,944
			Vail Resorts a,d	34,700		975,070
						17,556,013
			Media and Broadcasting - 0.7%
			Cox Radio Cl. A a,d	624,700		9,839,025
			Emmis Communications Cl. A a	47,774		844,167
			Regent Communications a,d	375,600		2,204,772
						12,887,964
			Restaurants and Lodgings - 0.6%
			Landry’s Restaurants	215,600		6,487,404
			Rubio’s Restaurants a,c,d	477,400		4,988,830
						11,476,234
			Retail Stores - 3.5%
			Bakers Footwear Group a,c,d	308,800		3,381,360
			Casual Male Retail Group a	594,300		4,344,333
			Charlotte Russe Holding a,d	339,500		4,230,170
			Dillard’s Cl. A	378,300		8,859,786
			Gander Mountain Company a,d	401,800		4,580,520
			Linens ’n Things a,d	377,200		8,924,552
			Longs Drug Stores	30,800		1,325,940
			Party City a,d	382,000		4,584,000
			REX Stores a	532,300		7,691,735
			Tweeter Home Entertainment Group a,d	800,300		2,000,750
			Wild Oats Markets a,d	879,300		10,067,985
			Wilsons The Leather Experts a,d	701,600		4,658,624
						64,649,755

  38  | THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

JUNE 30, 2005 (Unaudited)

	SHARES	VALUE			SHARES	VALUE
Consumer Services (continued)				Building Systems and Components - 0.6%
Other Consumer Services - 0.4%				Lennox International	431,500	$	9,134,855
Rent-Way a, d	821,900	$	8,087,496	Modtech Holdings a	434,701		2,825,557
Total (Cost $99,982,356)			120,895,894				11,960,412
Financial Intermediaries – 2.8%				Construction Materials - 0.4%
Banking - 1.2%				Apogee Enterprises	531,000		8,161,470
Banc Corporation (The)a	132,000		1,396,560
Community Capital Bancshares	71,600		791,896	Industrial Components - 5.2%
NetBank	921,200		8,585,584	American Technical Ceramics a	308,100		3,154,944
Pacific Mercantile Bancorp a, d	101,700		1,433,970	Barnes Group	443,800		14,689,780
Texas Capital Bancshares a, d	309,300		6,105,582	CTS Corporation	515,800		6,339,182
UMB Financial	74,100		4,225,923	Crane Company	341,600		8,984,080
				Deswell Industries	470,549		7,331,106
			22,539,515	Fansteel a	52,600		63,120
				Gerber Scientific a, c, d	1,323,400		9,210,864
Insurance - 1.6%				GrafTech International a, d	1,371,700		5,898,310
American Physicians Capital a	246,900		9,172,335	Hawk Corporation Cl. A a, c,	487,400		5,702,580
FBL Financial Group Cl. A	373,100		10,301,291	Ladish Company a	458,700		4,582,413
Horace Mann Educators	522,400		9,831,568	Lamson & Sessions Company a, c,	717,500		8,480,850
				MagneTek a	417,700		1,073,489
			29,305,194	Planar Systems a, d	626,600		4,605,510
				Timken Company (The)	389,900		9,006,690
Total (Cost $43,181,275)			51,844,709	Zygo Corporation a	767,900		7,525,420
Financial Services – 1.2%							96,648,338
Other Financial Services - 1.2%
Advanta Corporation Cl. B	366,000		10,306,560	Machinery - 6.8%
Metris Companies a, d	864,300		12,497,778	AGCO Corporation a, d	360,800		6,898,496
				Baldwin Technology Company Cl. A a, c,	773,000		2,396,300
Total (Cost $10,465,051)			22,804,338	Evans & Sutherland Computer a, c, d	587,325		2,965,991
				FEI Company a, d	440,900		10,056,929
Health – 3.5%				Flow International a, d	1,048,700		6,701,193
Drugs and Biotech - 1.3%				GSI Group a	1,134,800		10,689,816
Cambrex Corporation	569,600		10,850,880	Global Power Equipment Group a, d	580,400		4,614,180
Par Pharmaceutical Companies a, d	381,000		12,119,610	Hurco Companies a, c, d	361,000		5,761,560
Transgenomic a	807,600		549,168	JLG Industries	311,200		8,551,776
				Keithley Instruments	474,800		7,316,668
			23,519,658	LeCroy Corporation a, d	540,000		7,425,000
				Regal-Beloit	400,700		11,684,412
Health Services - 1.2%				Robbins & Myers	472,700		10,167,777
†Albany Molecular Research a, d	571,300		7,998,200	TB Wood’s a, c,	272,800		1,527,680
Cross Country Healthcare a	214,400		3,644,800	Terex Corporation a	286,400		11,284,160
Medical Staffing Network Holdings a, d	732,700		3,626,865	Thermadyne Holdings a	409,400		5,731,600
QuadraMed Corporation a, d	837,800		1,457,772	UNOVA a, d	479,200		12,761,096
Quovadx a	1,412,204		3,897,683
Tripos a	431,700		1,601,607				126,534,634
			22,226,927	Metal Fabrication and Distribution - 2.0%
				Aleris International a, d	368,505		8,309,788
Medical Products and Devices - 0.8%				Foster (L.B.) Company Cl. A a	494,200		4,596,060
Del Global Technologies a	267,885		683,107	Haynes International a	194,600		3,298,470
Encore Medical a, d	690,100		3,830,055	NN	198,708		2,519,617
New Brunswick Scientific a	353,374		1,883,483	Oregon Steel Mills a, d	500,100		8,606,721
PhotoMedex a, d	759,257		1,723,513	RTI International Metals a, d	285,300		8,961,273
Quinton Cardiology Systems a, d	394,500		3,171,780
†Zoll Medical a, d	151,700		3,860,765				36,291,929
			15,152,703	Paper and Packaging - 0.7%
				Chesapeake Corporation	395,700		8,285,958
Personal Care - 0.2%				Graphic Packaging a, d	1,278,200		4,665,430
Revlon Cl. A a, d	1,392,540		4,275,098
							12,951,388
Total (Cost $71,661,599)			65,174,386
				Pumps, Valves and Bearings - 1.9%
Industrial Products – 28.6%				Baldor Electric	412,600		10,034,432
Automotive - 0.4%				CIRCOR International	517,900		12,776,593
†Asbury Automotive Group a, d	102,500		1,579,525	Flowserve Corporation a, d	426,800		12,914,968
Spartan Motors	564,100		6,080,998
							35,725,993
			7,660,523

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  39

SCHEDULES OF INVESTMENTS

      Royce Opportunity Fund (continued)

	SHARES		VALUE		SHARES		VALUE
Industrial Products (continued)				Industrial Distribution - 0.2%
Specialty Chemicals and Materials - 7.5%				Rush Enterprises Cl. Ba,d	224,800	$	3,014,568
Aceto Corporation	882,750	$	6,602,970
Calgon Carbon	758,200		6,710,070	Printing - 0.3%
Crompton Corporation	571,300		8,083,895	Bowne & Co.	434,000		6,275,640
H.B. Fuller Company	209,500		7,135,570
LESCOa,d	404,800		5,098,456	Transportation and Logistics - 2.3%
Lydalla	604,100		5,207,342	Alaska Air Groupa,d	190,000		5,652,500
MacDermid	332,500		10,360,700	Atlas Air Worldwide Holdingsa,e	486,100		15,798,250
Material Sciencesa	620,400		9,033,024	Mesa Air Groupa,d	845,700		5,674,647
Mosaic Company (The)a,d	558,700		8,693,372	Pacific CMAa	541,100		449,113
OM Groupa,d	470,400		11,614,176	Sea Containers Cl. A	534,000		8,527,980
Park Electrochemical	529,300		13,338,360	Swift Transportation Companya,d	282,800		6,586,412
Penford Corporation	320,100		5,121,600
PolyOne Corporationa,d	1,021,000		6,759,020				42,688,902
Quaker Chemical	318,500		5,557,825
Spartech Corporation	478,700		8,520,860	Other Industrial Services - 0.1%
Terra Industriesa,d	757,800		5,160,618	National Technical Systemsa	345,700		1,642,075
Titanium Metalsa,d	305,145		17,329,185
				Total (Cost $114,113,961)			136,112,617
			140,327,043
				Natural Resources – 3.1%
Textiles - 0.1%				Energy Services - 1.5%
Dixie Groupa	136,100		2,396,721	Global Industriesa,d	565,500		4,806,750
				GulfMark Offshorea,d	296,800		8,105,608
Other Industrial Products - 3.0%				Newpark Resourcesa,d	1,081,800		8,113,500
†Cherokee Internationala,d	96,400		360,536	Universal Compression Holdingsa,d	191,700		6,947,208
Interface Cl. Aa,d	1,288,000		10,368,400
Maxwell Technologiesa	544,000		6,631,360				27,973,066
McGrath RentCorp	716,100		16,971,570
Tredegar Corporation	489,800		7,640,880	Oil and Gas - 1.2%
Trinity Industries	427,800		13,702,434	ATP Oil & Gasa	203,900		4,771,260
				Pioneer Drilling Companya	468,300		7,146,258
			55,675,180	TODCO Cl. Aa,d	389,000		9,985,630
Total (Cost $421,887,085)			534,333,631				21,903,148
Industrial Services – 7.3%				Precious Metals and Mining - 0.4%
Advertising and Publishing - 0.9%				Century Aluminuma,d	403,000		8,221,200
Harris Interactivea	850,100		4,139,987
Journal Register Companya,d	456,100		7,986,311	Total (Cost $36,671,972)			58,097,414
ValueClicka,d	409,000		5,042,970
				Technology – 35.5%
			17,169,268	Aerospace and Defense - 4.8%
				AirTran Holdingsa,d	728,900		6,727,747
Commercial Services - 2.1%				BE Aerospacea,d	403,100		6,300,453
Anacomp Cl. Aa	120,800		1,479,800	CPI Aerostructuresa	193,700		1,743,300
Carreker Corporationa	772,000		4,230,560	Ducommuna	397,000		6,713,270
Kforcea,d	475,575		4,023,365	Esterline Technologiesa,d	235,300		9,430,824
Management Network Groupa	905,500		1,992,100	Fairchild Corporation (The) Cl. Aa	562,800		1,609,608
Rentrak Corporationa,d	305,800		2,752,200	GenCorpa	255,500		4,920,930
Sparton Corporationa	321,518		3,179,813	HEICO Corporation	340,600		7,973,446
TRC Companiesa,c,d	817,400		9,596,276	Herley Industriesa	354,700		6,469,728
Volt Information Sciencesa	415,800		9,866,934	Hexcel Corporationa,d	1,019,200		17,244,864
Xanser Corporationa	1,365,500		3,167,960	Kaman Corporation Cl. A	641,600		11,574,464
				LaBargea	215,100		3,904,065
			40,289,008	Teledyne Technologiesa,d	164,300		5,352,894
Engineering and Construction - 1.3%							89,965,593
Champion Enterprisesa,d	806,100		8,012,634
Comfort Systems USAa,d	848,000		5,579,840	Components and Systems - 7.3%
Fleetwood Enterprisesa,d	612,800		6,219,920	Ampex Corporation Cl. Aa	69,400		2,727,420
Matrix Service Companya,d	812,100		3,719,418	Analogic Corporation	243,400		12,247,888
				Aulta,c	321,100		866,970
			23,531,812	Belden CDTd	532,550		11,290,060
				Celesticaa,d	525,800		7,045,720
Food and Tobacco Processors - 0.1%				Craya,d	1,523,100		1,888,644
Galaxy Nutritional Foodsa	721,800		1,501,344	Dot Hill Systemsa,d	391,500		2,051,460
				Hypercom Corporationa,d	782,700		5,064,069
				InFocus Corporationa,d	1,229,700		5,090,958

40  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

JUNE 30, 2005 (Unaudited)

	SHARES		VALUE		SHARES		VALUE
Technology (continued)				MEMC Electronic Materialsa,d	592,500	$	9,343,725
Components and Systems (continued)				Mentor Graphicsa,d	661,500		6,780,375
Innovexa,d	577,000	$	1,979,110	PLX Technologya,d	633,400		6,435,344
Interlink Electronicsa,d	635,000		3,594,100	Pericom Semiconductora,d	814,500		6,630,030
Interphase Corporationa,c	393,800		2,461,250	†Sanmina-SCI Corporationa,d	337,200		1,844,484
Iomega Corporationa	1,457,100		3,861,315	Silicon Storage Technologya,d	559,300		2,253,979
KEMET Corporationa,d	880,200		5,545,260	Standard Microsystemsa,d	486,800		11,381,384
Lantronixa	1,180,700		1,546,717	TriQuint Semiconductora,d	1,128,600		3,758,238
Maxtor Corporationa,d	733,600		3,814,720	Ultra Clean Holdingsa,d	275,700		2,053,965
Merix Corporationa,d	735,700		4,303,845	Varian Semiconductor Equipment
Nam Tai Electronics	497,000		11,301,780	Associatesa,d	219,400		8,117,800
OSI Systemsa,d	471,100		7,438,669	Veeco Instrumentsa,d	676,400		11,011,792
Pinnacle Systemsa,d	747,500		4,111,250	Vitesse Semiconductera,d	715,300		1,494,977
Printronix	315,400		5,273,488	White Electronic Designsa	794,800		4,411,140
SBS Technologiesa	462,350		4,290,608
SCM Microsystemsa,c,d	934,620		2,579,551				156,042,612
Sigmatron Internationala,c	210,400		2,236,552
Spectrum Controla,d	614,100		4,139,034	Software - 4.0%
TTM Technologiesa,d	669,800		5,097,178	†Actel Corporationa,d	327,700		4,555,030
Vishay Intertechnologya,d	965,100		11,455,737	Aspen Technologya,d	928,400		4,827,680
Western Digitala,d	251,900		3,380,498	†Avid Technologya,d	114,500		6,100,560
				Borland Softwarea,d	1,283,800		8,806,868
			136,683,851	Epicor Softwarea,d	721,000		9,517,200
				Evolving Systemsa,d	566,800		1,626,716
Distribution - 1.0%				Indus Internationala,d	1,004,300		2,470,578
Bell Industriesa,c	442,900		1,014,241	MSC.Softwarea,d	624,400		8,554,280
Bell Microproductsa,d	798,400		7,504,960	†Majesco Entertainment Companya,d	192,800		1,260,912
Benchmark Electronicsa,d	328,400		9,989,928	Manugistics Groupa,d	1,799,500		3,203,110
				NetIQ Corporationa,d	746,400		8,471,640
			18,509,129	†Phase Forwarda,d	411,600		2,798,880
				Phoenix Technologiesa,d	959,000		7,461,020
Internet Software and Services - 1.1%				†PLATO Learninga,d	82,730		610,547
Digitasa,d	588,051		6,709,662	QAD	674,100		5,190,570
†Interwovena,d	309,900		2,333,547	Versant Corporationa	381,500		122,080
Lionbridge Technologiesa,d	685,810		4,649,792
1-800-Flowers.coma	745,200		5,246,208				75,577,671
Tumbleweed Communicationsa,d	458,500		1,192,100
				Telecommunications - 7.4%
			20,131,309	Aether Systemsa,d	1,076,500		3,541,685
				Andrew Corporationa,d	722,400		9,217,824
IT Services - 1.5%				Arris Groupa,d	918,700		8,001,877
CIBERa,d	893,623		7,131,112	C-COR.neta,d	955,400		6,544,490
Computer Horizonsa,c	1,617,500		5,062,775	Carrier Accessa,d	673,866		3,248,034
Computer Task Groupa,c	1,216,100		4,390,121	Centillium Communicationsa	1,770,700		3,842,419
Keanea	745,700		10,216,090	ClearOne Communicationsa,d	385,700		1,369,235
Technology Solutionsa	1,205,900		651,186	CommScopea,d	671,400		11,689,074
				Covad Communications Groupa,d	1,444,200		2,021,880
			27,451,284	EMS Technologiesa	492,346		7,360,573
				EMCORE Corporationa,d	676,300		2,793,119
Semiconductors and Equipment - 8.4%				General Communication Cl. Aa,d	578,700		5,711,769
ADE Corporationa,d	312,300		8,760,015	Glenayre Technologiesa,d	1,212,400		4,570,748
†Advanced Energy Industriesa,d	338,500		2,660,610	Globecomm Systemsa,d	379,900		2,283,199
†Aixtron ADRa,b,d	672,713		2,408,313	Harmonica,d	345,500		1,668,765
Alliance Semiconductora	974,100		2,483,955	Inter-Tel	442,700		8,238,647
ANADIGICSa,d	1,183,900		2,296,766	Interlanda,d	537,600		1,048,320
Brooks Automationa,d	540,700		8,029,395	MetaSolva	1,173,300		2,757,255
California Micro Devicesa	1,067,100		6,061,128	Network Equipment Technologiesa	1,210,300		6,245,148
†Cascade Microtecha,d	190,100		2,775,460	Powerwave Technologiesa,d	1,175,700		12,015,654
Credence Systemsa,d	1,149,800		10,405,690	Radyne ComStreama	602,600		5,227,555
Cypress Semiconductora,d	894,800		11,265,532	Redback Networksa,d	517,100		3,299,098
Electroglasa,d	962,000		3,001,440	Symmetricoma,d	965,600		10,013,272
FSI Internationala,d	925,000		3,441,000	Tollgrade Communicationsa,c	707,900		5,309,250
†Fairchild Semiconductor
International Cl. Aa,d	481,300		7,099,175
Integrated Silicon Solutiona,d	770,000		5,705,700
Intevaca,d	394,575		4,131,200

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  41

SCHEDULES OF INVESTMENTS
Royce Opportunity Fund (continued)	Royce Special Equity Fund

	SHARES		VALUE			SHARES		VALUE
Technology (continued)					COMMON STOCKS – 91.5%
Telecommunications (continued)
†UTStarcoma,d	358,800	$	2,687,412		Consumer Products – 19.1%
Westell Technologies Cl. Aa	1,135,600		6,790,888		Apparel and Shoes - 4.5%
					Hampshire Groupa,c	480,000	$	9,412,800
			137,497,190		K-Swiss Cl. A	550,000		17,787,000
					Kellwood Company	412,500		11,096,250
Total (Cost $618,541,260)			661,858,639		Lakeland Industriesa	217,500		2,977,575
Miscellaneous – 1.3%								41,273,625
Total (Cost $24,021,824)			24,112,661
					Food/Beverage/Tobacco - 4.1%
TOTAL COMMON STOCKS					Lancaster Colony	650,000		27,898,000
(Cost $1,502,698,228)			1,745,566,105		National Beveragea	1,185,000		9,456,300
REPURCHASE AGREEMENT – 6.8%								37,354,300
State Street Bank & Trust Company,
2.55% dated 6/30/05, due 7/1/05,					Home Furnishing and Appliances - 8.3%
maturity value $127,213,010					American Woodmark	565,000		16,955,650
(collateralized by obligations of various					Chromcraft Revingtona,c	332,500		4,538,625
U.S. Government Agencies, valued at					Ethan Allen Interiors	345,000		11,560,950
$130,388,892)					Flexsteel Industriesc	369,200		5,194,644
(Cost $127,204,000)			127,204,000		Hooker Furniture	662,500		11,573,875
					MITY Enterprisesa	187,500		2,906,250
COLLATERAL RECEIVED FOR SECURITIES LOANED – 10.0%					National Presto Industriesc	522,500		23,026,575
Money Market Funds
State Street Navigator Securities Lending								75,756,569
Prime Portfolio			186,025,434
					Sports and Recreation - 0.7%
(Cost $186,025,434)			186,025,434		Escalade	435,000		6,016,050
TOTAL INVESTMENTS – 110.4%					Other Consumer Products - 1.5%
(Cost $1,815,927,662)			2,058,795,539		Koss Corporation	167,500		2,847,500
					Movado Group	327,500		6,183,200
LIABILITIES LESS CASH AND OTHER ASSETS – (10.4)%			(193,707,205	)	Yankee Candle Company	145,000		4,654,500
NET ASSETS – 100.0%		$	1,865,088,334					13,685,200
					Total (Cost $147,987,525)			174,085,744
					Consumer Services - 17.4%
					Leisure and Entertainment - 0.3%
					Bowl America Cl. A	165,000		2,305,050
					Restaurants and Lodgings - 3.9%
					CEC Entertainmenta	390,300		16,427,727
					Frisch’s Restaurantsc	312,600		7,815,000
					Jack in the Boxa	303,700		11,516,304
								35,759,031
					Retail Stores - 13.2%
					Arden Group Cl. A	114,960		9,114,029
					BJ’s Wholesale Cluba	596,900		19,393,281
					Borders Group	1,360,000		34,421,600
					Cato Corporation Cl. A	241,650		4,990,073
					†Claire’s Stores	654,000		15,728,700
					Deb Shops	475,000		13,760,750
					Jo-Ann Storesa	360,600		9,516,234
					Neiman Marcus Group (The) Cl. A	132,200		12,812,824
								119,737,491
					Total (Cost $114,033,660)			157,801,572
					Financial Services – 1.6%
					Insurance Brokers - 1.6%
					Hilb Rogal & Hobbs Company	414,200		14,248,480
					Total (Cost $12,556,338)			14,248,480

42  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

JUNE 30, 2005 (Unaudited)

	SHARES		VALUE		SHARES		VALUE
Health – 5.9%				Printing - 5.9%
Commercial Services - 0.8%				Banta Corporation	776,200	$	35,208,432
Owens & Minor	213,300	$	6,900,255	CSS Industriesc	552,300		18,689,832
Health Services - 0.7%							53,898,264
National Dentexa,c	345,000		6,234,150
				Transportation and Logistics - 1.5%
Medical Products and Devices - 3.1%				Arkansas Best	415,000		13,201,150
Bio-Rad Laboratories Cl. Aa	472,500		27,976,725
				Total (Cost $117,657,756)			148,105,464
Personal Care - 1.3%
Regis	310,000		12,114,800	Technology – 1.4%
				Components and Systems - 1.4%
Total (Cost $45,769,596)			53,225,930	Rimage Corporationa	227,700		4,834,071
				†Tektronix	353,700		8,230,599
Industrial Products – 28.8%							13,064,670
Automotive - 5.5%
Bandag Cl. A	616,000		24,948,000	Total (Cost $11,380,267)			13,064,670
R&Ba	732,600		10,285,704
Strattec Securitya	145,000		7,896,700	Miscellaneous – 1.0%
Superior Industries Internationald	285,000		6,754,500	Total (Cost $8,942,260)			9,581,748
			49,884,904	TOTAL COMMON STOCKS
				(Cost $672,774,737)			831,647,220
Construction Materials - 0.5%
†NCI Building Systemsa	140,000		4,592,000	REPURCHASE AGREEMENT – 8.5%
				State Street Bank & Trust Company,
Industrial Components - 3.5%				2.55% dated 6/30/05, due 7/1/05,
Genlyte Group (The)a	395,000		19,252,300	maturity value $77,518,491
Standex International	434,300		12,338,463	(collateralized by obligations of various
				U.S. Government Agencies, valued at
			31,590,763	$79,455,676)
				(Cost $77,513,000)			77,513,000
Machinery - 6.9%
Briggs & Stratton	585,000		20,252,700	COLLATERAL RECEIVED FOR SECURITIES LOANED – 0.5%
Cascade Corporation	571,200		24,704,400	Money Market Funds
Rofin-Sinar Technologiesa	542,500		17,794,000	AIM Liquid Assets Institutional Fund			558,081
				AIM Treasury Assets Institutional Fund			3,775,843
			62,751,100
				(Cost $4,333,924)			4,333,924
Metal Fabrication and Distribution - 0.5%
Quanex Corporation	83,200		4,410,432	TOTAL INVESTMENTS – 100.5%
				(Cost $754,621,661)			913,494,144
Paper and Packaging - 2.5%
Schweitzer-Mauduit International	730,000		22,724,900	LIABILITIES LESS CASH AND OTHER ASSETS – (0.5%)			(4,432,662	)
Specialty Chemicals and Materials - 7.4%				NET ASSETS – 100.0%		$	909,061,482
Hawkinsc	545,000		6,621,750
Lubrizol Corporation	727,100		30,545,471
†MacDermid	270,000		8,413,200
Quaker Chemical	37,000		645,650
Schulman (A.)	1,160,000		20,752,400
			66,978,471
Other Industrial Products - 2.0%
Met-Pro Corporationc	632,600		9,596,542
Superior Uniform Groupc	652,500		9,004,500
			18,601,042
Total (Cost $214,447,335)			261,533,612
Industrial Services – 16.3%
Commercial Services - 2.5%
Global Imaging Systemsa	270,000		8,602,200
Watson Wyatt & Company Holdings	535,000		13,712,050
			22,314,250
Food and Tobacco Processors - 4.3%
Sanderson Farms	470,000		21,356,800
Universal	405,000		17,730,900
			39,087,700
Industrial Distribution - 2.1%
Lawson Productsc	505,000		19,604,100

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  43

SCHEDULES OF INVESTMENTS

      Royce Select Fund

	SHARES		VALUE		SHARES		VALUE
COMMON STOCKS – 86.1%				Medical Products and Devices - 2.0%
Consumer Products – 3.7%				Arrow International	15,000	$	478,500
Apparel and Shoes - 2.9%
Polo Ralph Lauren Cl. A	15,800	$	681,138	Total (Cost $1,212,620)			1,656,868
Collectibles - 0.8%				Industrial Products – 10.3%
†Action Performance Companies a	20,000		176,400	Automotive - 3.5%
				†Adesa	15,000		326,550
Total (Cost $811,399)			857,538	†LKQ Corporationa	18,300		496,845
Consumer Services – 6.6%							823,395
Direct Marketing - 0.9%
†Sportsman’s Guide (The)a	10,600		198,750	Building Systems and Components - 1.2%
				Juno Lightinga	6,700		288,569
Retail Stores - 3.6%
Charming Shoppesa	31,700		295,761	Construction Materials - 1.1%
Hot Topica	22,000		420,640	Florida Rock Industries	3,325		243,889
†99 Cents Only Storesa	9,000		114,390
				Machinery - 1.4%
			830,791	Lincoln Electric Holdings	9,500		314,925
Other Consumer Services - 2.1%				Metal Fabrication and Distribution - 1.1%
†Corinthian Collegesa	17,900		228,583	†Metal Management	13,100		253,485
MoneyGram International	13,800		263,856
				Specialty Chemicals and Materials - 2.0%
			492,439	MacDermid	15,000		467,400
Total (Cost $1,451,885)			1,521,980	Total (Cost $1,617,672)			2,391,663
Financial Intermediaries – 2.4%				Industrial Services – 8.1%
Insurance - 1.2%				Commercial Services - 1.2%
Erie Indemnity Company Cl. A	5,000		271,250	MPS Groupa	30,000		282,600
Securities Brokers - 1.2%				Industrial Distribution - 3.3%
E*TRADE Financiala	20,100		281,199	Ritchie Bros. Auctioneers	20,000		771,000
Total (Cost $305,001)			552,449	Transportation and Logistics - 3.6%
				EGLa	21,000		426,720
				†Universal Truckload Servicesa	24,300		410,427
Financial Services – 16.5%
Information and Processing - 4.6%							837,147
eFunds Corporationa	25,000		449,750
SEI Investments	16,700		623,745	Total (Cost $1,242,278)			1,890,747
			1,073,495	Natural Resources – 3.7%
				Energy Services - 1.0%
Insurance Brokers - 2.7%				Helmerich & Payne	4,700		220,524
Brown & Brown	5,000		224,700
Gallagher (Arthur J.) & Company	15,000		406,950	Oil and Gas - 2.7%
				Penn Virginia	14,000		625,380
			631,650
				Total (Cost $514,560)			845,904
Investment Management - 6.3%
Alliance Capital Management Holding L.P.	18,500		864,690	Technology – 23.9%
Nuveen Investments Cl. A	15,800		594,396	Aerospace and Defense - 1.2%
				†HEICO Corporation Cl. A	14,800		266,696
			1,459,086
				Components and Systems - 7.6%
Other Financial Services - 2.9%				†Electronics for Imaginga	9,200		193,568
†MarketAxess Holdingsa	22,000		248,600	Lowrance Electronics	14,780		310,675
†Morningstara	15,100		425,065	†Nam Tai Electronics	12,500		284,250
				Plexus Corporationa	36,700		522,241
			673,665	Technitrol	32,600		460,638
Total (Cost $2,977,388)			3,837,896				1,771,372
Health – 7.1%				Distribution - 0.9%
Commercial Services - 2.7%				Benchmark Electronicsa	7,100		215,982
Covancea	4,500		201,915
IDEXX Laboratoriesa	6,700		417,611	Internet Software and Services - 1.1%
				†eResearch Technologya	19,000		254,410
			619,526
				IT Services - 4.0%
Drugs and Biotech - 2.4%				MAXIMUS	6,400		225,856
Lexicon Geneticsa	37,500		185,250	Perot Systems Cl. Aa	17,300		246,006
Perrigo Company	26,800		373,592	Sapient Corporationa	32,900		260,897
			558,842

44  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

JUNE 30, 2005 (Unaudited)
	Royce Value Fund

	SHARES		VALUE		SHARES		VALUE
Technology (continued)				COMMON STOCKS – 87.7%
IT Services (continued)				Consumer Products – 13.7%
Syntel	12,600	$	201,978	Apparel and Shoes - 5.6%
				†Kenneth Cole Productions Cl. A	29,300	$	911,816
			934,737	K-Swiss Cl. A	19,000		614,460
				Polo Ralph Lauren Cl. A	29,500		1,271,745
Semiconductors and Equipment - 4.6%				Timberland Company Cl. Aa	17,200		665,984
Cognex Corporation	20,600		539,514
Exar Corporationa	34,700		516,683				3,464,005
			1,056,197	Home Furnishing and Appliances - 1.9%
				Ethan Allen Interiors	34,300		1,149,393
Software - 2.3%
JDA Software Groupa	15,000		170,700	Sports and Recreation - 2.8%
Pegasystems a	32,800		193,520	Thor Industries	26,300		826,609
Verity a	20,600		180,662	Winnebago Industries	27,500		900,625
			544,882				1,727,234
Telecommunications - 2.2%				Other Consumer Products - 3.4%
ADTRAN	20,500		508,195	Blyth	21,200		594,660
				Fossil a	28,600		649,220
Total (Cost $5,210,392)			5,552,471	RC2 Corporationa	21,900		822,783
Miscellaneous – 3.8%							2,066,663
Total (Cost $881,284)			885,598
				Total (Cost $7,876,806)			8,407,295
TOTAL COMMON STOCKS
(Cost $16,224,479)			19,993,114	Consumer Services – 10.6%
				Direct Marketing - 2.8%
REPURCHASE AGREEMENT – 12.4%				Nu Skin Enterprises Cl. A	74,000		1,724,200
State Street Bank & Trust Company,
2.55% dated 6/30/05, due 7/1/05,				Restaurants and Lodgings - 3.6%
maturity value $2,886,204				CEC Entertainmenta	15,400		648,186
(collateralized by obligations of various				†Ruby Tuesday	35,700		924,630
U.S. Government Agencies, valued at				Ryan’s Restaurant Groupa	46,900		657,069
$2,962,141)
(Cost $2,886,000)							2,229,885
			2,886,000
				Retail Stores - 4.2%
TOTAL INVESTMENTS – 98.5%				AnnTaylor Storesa	17,400		422,472
(Cost $19,110,479)			22,879,114	Buckle (The)	18,100		802,554
				Pier 1 Imports	44,200		627,198
CASH AND OTHER ASSETS LESS LIABILITIES – 1.5%			357,057	Talbots	22,700		737,069
NET ASSETS – 100.0%		$	23,236,171				2,589,293
				Total (Cost $5,960,782)			6,543,378
				Financial Intermediaries – 11.3%
				Insurance - 9.4%
				Alleghany Corporationa	3,468		1,029,996
				AmerUs Group	25,900		1,244,495
				Aspen Insurance Holdings	64,600		1,780,376
				†Endurance Specialty Holdings	33,800		1,278,316
				Wesco Financial	1,150		414,000
							5,747,183
				Other Financial Intermediaries - 1.9%
				TSX Group	40,000		1,191,968
				Total (Cost $6,373,532)			6,939,151
				Financial Services – 4.1%
				Information and Processing - 2.4%
				eFunds Corporationa	82,400		1,482,376
				Investment Management - 1.7%
				Federated Investors Cl. B	24,000		720,240
				Gabelli Asset Management Cl. A	6,800		300,492
							1,020,732
				Total (Cost $2,568,428)			2,503,108

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  45

SCHEDULES OF INVESTMENTS

      Royce Value Fund (continued)

	SHARES		VALUE		SHARES		VALUE
Health – 5.5%				Semiconductors and Equipment - 3.8%
Drugs and Biotech - 3.9%				Cabot Microelectronics a	21,100	$	611,689
†Elan Corporation ADR a,b	116,000	$	791,120	Fairchild Semiconductor International Cl. A a	62,500		921,875
Endo Pharmaceuticals Holdings a	35,500		932,940	†OmniVision Technologies a	57,100		775,989
Perrigo Company	47,800		666,332
							2,309,553
			2,390,392
				Software - 3.1%
Health Services - 1.1%				ManTech International Cl. A a	24,400		757,376
AMERIGROUP Corporation a	16,300		655,260	Sybase a	11,100		203,685
				Transaction Systems Architects Cl. A a	38,400		945,792
Medical Products and Devices - 0.5%
Arrow International	10,300		328,570				1,906,853
Total (Cost $2,723,613)			3,374,222	Telecommunications - 1.7%
				Foundry Networks a	120,300		1,038,189
Industrial Products – 9.1%
Building Systems and Components - 1.3%				Total (Cost $6,977,139)			7,440,735
Simpson Manufacturing	26,300		803,465
				Miscellaneous – 2.4%
Construction Materials - 0.9%				Total (Cost $1,642,470)			1,510,777
Florida Rock Industries	7,500		550,125
				TOTAL COMMON STOCKS
Machinery - 3.2%				(Cost $49,166,453)			53,949,148
Lincoln Electric Holdings	35,700		1,183,455
†Rofin-Sinar Technologies a	23,600		774,080	REPURCHASE AGREEMENT – 14.1%
				State Street Bank & Trust Company,
			1,957,535	2.55% dated 6/30/05, due 7/1/05,
				maturity value $8,715,617
Metal Fabrication and Distribution - 3.7%				(collateralized by obligations of various
IPSCO	27,000		1,179,900	U.S. Government Agencies, valued at
Schnitzer Steel Industries Cl. A	46,300		1,097,310	$8,933,494)
				(Cost $8,715,000)			8,715,000
			2,277,210
				TOTAL INVESTMENTS – 101.8%
Total (Cost $5,498,013)			5,588,335	(Cost $57,881,453)			62,664,148
Industrial Services – 1.7%				LIABILITIES LESS CASH
Engineering and Construction - 1.7%				AND OTHER ASSETS – (1.8)%			(1,133,595	)
Dycom Industries a	53,200		1,053,892
				NET ASSETS – 100.0%		$	61,530,553
Total (Cost $1,147,245)			1,053,892
Natural Resources – 17.2%
Energy Services - 6.6%
Ensign Energy Services	58,500		1,411,888
Patterson-UTI Energy	34,900		971,267
Trican Well Service a	68,400		1,681,528
			4,064,683
Oil and Gas - 5.5%
Cimarex Energy a	26,500		1,031,115
St. Mary Land & Exploration Company	47,300		1,370,754
Unit Corporation a	22,100		972,621
			3,374,490
Precious Metals and Mining - 5.1%
Agnico-Eagle Mines	50,000		630,000
Glamis Gold a	55,700		958,597
Meridian Gold a	50,000		900,000
Silver Standard Resources a	56,500		660,485
			3,149,082
Total (Cost $8,398,425)			10,588,255
Technology – 12.1%
Components and Systems - 2.0%
Tektronix	53,000		1,233,310
IT Services - 1.5%
MAXIMUS	27,000		952,830

46  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

JUNE 30, 2005 (Unaudited)

      Royce Value Plus Fund

	SHARES		VALUE		SHARES		VALUE
COMMON STOCKS – 91.9%				Health Services - 0.8%
Consumer Products – 8.1%				†Horizon Health a	70,000	$	1,637,300
Apparel and Shoes - 2.5%
†Kenneth Cole Productions Cl. A	69,000	$	2,147,280	Medical Products and Devices - 2.8%
Polo Ralph Lauren Cl. A	73,000		3,147,030	Arrow International	35,000		1,116,500
				Caliper Life Sciences a	435,300		2,437,680
			5,294,310	Possis Medical a	118,600		1,201,418
				Thoratec Corporation a	66,800		1,024,712
Collectibles - 0.2%
†Action Performance Companies a	56,900		501,858				5,780,310
Home Furnishing and Appliances - 1.2%				Total (Cost $31,272,349)			32,580,396
Select Comfort a	117,700		2,522,311
				Industrial Products – 13.8%
Sports and Recreation - 2.9%				Automotive - 1.6%
Oakley	200,000		3,406,000	Adesa	149,000		3,243,730
Winnebago Industries	84,000		2,751,000
				Building Systems and Components - 2.0%
			6,157,000	AZZ a	50,200		868,460
				Drew Industries a	73,100		3,318,740
Other Consumer Products - 1.3%
Fossil a	116,000		2,633,200				4,187,200
Total (Cost $16,083,047)			17,108,679	Machinery - 3.1%
				Lincoln Electric Holdings	103,000		3,414,450
Consumer Services – 2.2%				Pason Systems	183,400		3,188,394
Direct Marketing - 2.2%
Nu Skin Enterprises Cl. A	201,600		4,697,280				6,602,844
Total (Cost $3,987,739)			4,697,280	Metal Fabrication and Distribution - 6.5%
				†Harris Steel Group	170,000		2,858,309
Financial Intermediaries – 2.8%				IPSCO	83,000		3,627,100
Insurance - 1.3%				†Metal Management	139,100		2,691,585
AmerUs Group	58,000		2,786,900	Schnitzer Steel Industries Cl. A	186,000		4,408,200
Securities Brokers - 1.5%							13,585,194
†Investment Technology Group a	150,100		3,155,102
				Other Industrial Products - 0.6%
Total (Cost $5,525,374)			5,942,002	Color Kinetics a	118,300		1,258,712
Financial Services – 6.0%				Total (Cost $27,372,974)			28,877,680
Information and Processing - 2.3%
eFunds Corporation a	274,000		4,929,260	Industrial Services – 11.1%
				Commercial Services - 4.7%
Investment Management - 1.5%				†Ceridian Corporation a	107,000		2,084,360
†Nuveen Investments Cl. A	81,000		3,047,220	Digital Theater Systems a	121,000		2,157,430
				Exponent a	92,900		2,655,082
Other Financial Services - 2.2%				LECG Corporation a	135,900		2,889,234
†MarketAxess Holdings a	218,900		2,473,570
†Morningstar a	76,000		2,139,400				9,786,106
			4,612,970	Engineering and Construction - 2.2%
				Dycom Industries a	149,500		2,961,595
Total (Cost $12,058,288)			12,589,450	Insituform Technologies Cl. A a	102,000		1,635,060
Health – 15.5%							4,596,655
Commercial Services - 2.3%
Dendrite International a	145,000		2,001,000	Food and Tobacco Processors - 0.7%
ICON ADR a,b	84,500		2,932,150	Omega Protein a	244,100		1,542,712
			4,933,150	Industrial Distribution - 0.7%
				Ritchie Bros. Auctioneers	37,500		1,445,625
Drugs and Biotech - 9.6%
†Draxis Health a	425,000		2,112,250	Printing - 1.3%
†Elan Corporation ADR a,b	385,000		2,625,700	†Banta Corporation	59,000		2,676,240
Endo Pharmaceuticals Holdings a	147,300		3,871,044
Lexicon Genetics a	192,500		950,950	Transportation and Logistics - 1.5%
Myriad Genetics a	116,000		1,815,400	†Universal Truckload Services a	190,900		3,224,301
Orchid Cellmark a	314,000		3,394,340
Perrigo Company	143,400		1,998,996	Total (Cost $23,034,602)			23,271,639
QLT a	192,000		2,000,640
Zila a	510,600		1,460,316	Natural Resources – 13.5%
				Energy Services - 6.0%
			20,229,636	Ensign Energy Services	170,000		4,102,922
				Input/Output a	389,100		2,443,548
				Tesco Corporation a	193,200		2,113,608
				Trican Well Service a	158,900		3,906,356
							12,566,434

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  47

SCHEDULES OF INVESTMENTS

      Royce Value Plus Fund (continued)

	SHARES		VALUE			VALUE
Natural Resources (continued)				Miscellaneous – 2.7%
Precious Metals and Mining - 7.5%				Total (Cost $5,842,969)	$	5,591,082
Glamis Gold a	186,000	$	3,201,060
Hecla Mining Company a	595,000		2,713,200	TOTAL COMMON STOCKS
Meridian Gold a	144,900		2,608,200	(Cost $184,369,722)		193,083,227
Northern Orion Resources a	330,000		808,500
NovaGold Resources a	387,700		2,958,151	REPURCHASE AGREEMENT – 7.6%
Silver Standard Resources a	185,000		2,162,650	State Street Bank & Trust Company,
Western Silver a	155,900		1,356,330	2.55% dated 6/30/05, due 7/1/05,
				maturity value $15,957,130
			15,808,091	(collateralized by obligations of various
				U.S. Government Agencies, valued at
Total (Cost $23,953,459)			28,374,525	$16,356,898)
				(Cost $15,956,000)		15,956,000
Technology – 16.2%
Components and Systems - 1.8%				TOTAL INVESTMENTS – 99.5%
Lowrance Electronics	92,000		1,933,840	(Cost $200,325,722)		209,039,227
TTM Technologies a	240,000		1,826,400
				CASH AND OTHER ASSETS LESS LIABILITIES – 0.5%		1,107,833
			3,760,240
				NET ASSETS – 100.0%	$	210,147,060
Internet Software and Services - 1.4%
RealNetworks a	600,000		2,982,000
IT Services - 2.6%
Perot Systems Cl. A a	250,000		3,555,000
RADVision a	150,000		1,993,500
			5,548,500
Semiconductors and Equipment - 3.8%
Cabot Microelectronics a	66,000		1,913,340
DSP Group a	68,000		1,623,160
Exar Corporation a	65,000		967,850
†Photronics a	150,000		3,501,000
			8,005,350
Software - 3.9%
InterVideo a	119,200		1,714,096
iPass a	318,800		1,931,928
ManTech International Cl. A a	52,000		1,614,080
†SPSS a	150,000		2,881,500
			8,141,604
Telecommunications - 2.7%
Foundry Networks a	400,000		3,452,000
KVH Industries a	233,600		2,160,800
			5,612,800
Total (Cost $35,238,921)			34,050,494

48  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

JUNE 30, 2005 (Unaudited)

      Royce Technology Value Fund

	SHARES		VALUE		SHARES		VALUE
COMMON STOCKS – 83.0%				Software - 27.0%
Aerospace and Defense - 1.5%				Aspen Technology a	120,000	$	624,000
American Science & Engineering a	10,000	$	443,600	†@Road a	80,000		212,800
				BindView Development a	150,000		414,000
Total (Cost $407,875)			443,600	E.piphany a	170,000		591,600
				Indus International a	250,000		615,000
Commercial Services - 5.8%				Informatica Corporation a	40,000		335,600
†Ceridian Corporation a	20,000		389,600	†Micromuse a	100,000		566,000
†First Advantage Cl. A a	10,000		233,100	Mobius Management Systems a	70,000		462,000
Hollywood Media a	120,000		520,800	†Motive a	40,000		397,200
TriZetto Group (The)a	40,000		560,400	Open Text a	40,000		566,400
				SCO Group (The)a	382,500		1,464,975
Total (Cost $1,425,201)			1,703,900	Transaction Systems Architects Cl. A a	25,000		615,750
				Ultimate Software Group a	30,000		492,000
Components and Systems - 2.8%				Verity a	70,000		613,900
Cray a	50,000		62,000
Digi International a	40,000		474,400	Total (Cost $10,790,012)			7,971,225
On Track Innovations a	20,000		276,400
				Telecommunications - 14.1%
Total (Cost $909,947)			812,800	Arris Group a	30,000		261,300
				Broadwing Corporation a	50,000		231,000
Health Services - 1.4%				†Brooktrout a	45,000		502,200
Eclipsys Corporation a	30,000		422,100	†GigaBeam a	30,000		193,500
				Harmonic a	110,000		531,300
Total (Cost $332,454)			422,100	iBasis a	200,000		544,000
				Lightbridge a	30,000		187,500
Internet Software and Services - 23.1%				PC-Tel a	50,000		391,500
†Aptimus a	10,000		196,100	Scientific-Atlanta	10,000		332,700
CyberSource Corporation a	50,000		365,500	Terayon Communication Systems a	50,000		154,500
†Digital Insight a	15,000		358,800	UCN a	141,500		275,925
Dynabazaar a	150,000		48,000	Westell Technologies Cl. A a	90,000		538,200
Jacada a	330,100		848,357
†Online Resources a	45,000		508,950	Total (Cost $4,510,289)			4,143,625
Openwave Systems a	30,000		492,000
†PFSweb a	118,100		245,648	Miscellaneous - 1.0%
†Provide Commerce a	10,000		215,900	Total (Cost $353,972)			308,328
Register.com a	6,525		48,938
†RightNow Technologies a	60,000		721,200	TOTAL COMMON STOCKS
S1 Corporation a	85,000		400,350	(Cost $26,264,964)			24,480,721
Stellent a	100,000		750,000
SupportSoft a	100,000		519,000	REPURCHASE AGREEMENT – 13.7%
†WebSideStory a	25,000		366,500	State Street Bank & Trust Company,
WebMD Corporation a	70,000		718,900	2.55% dated 6/30/05, due 7/1/05,
				maturity value $4,041,286
Total (Cost $5,988,366)			6,804,143	(collateralized by obligations of various
				U.S. Government Agencies, valued at
IT Services - 1.5%				$4,145,836)
PacificNet a	20,000		151,800	(Cost $4,041,000)			4,041,000
Tyler Technologies a	40,000		302,400
				TOTAL INVESTMENTS – 96.7%
Total (Cost $601,769)			454,200	(Cost $30,305,964)			28,521,721
Other Financial Intermediaries - 1.5%				CASH AND OTHER ASSETS LESS LIABILITIES – 3.3%			967,563
Electronic Clearing House a	50,000		435,000
				NET ASSETS – 100.0%		$	29,489,284
Total (Cost $392,501)			435,000
Semiconductors and Equipment - 3.3%
Intevac a	60,000		628,200
†SiRF Technology Holdings a	20,000		353,600
Total (Cost $552,578)			981,800

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  49

SCHEDULES OF INVESTMENTS

      Royce 100 Fund

	SHARES		VALUE		SHARES		VALUE
COMMON STOCKS – 91.5%				Investment Management - 3.6%
Consumer Products – 6.1%				Federated Investors Cl. B	4,300	$	129,043
Apparel and Shoes - 1.9%				Gabelli Asset Management Cl. A	1,900		83,961
†Kenneth Cole Productions Cl. A	4,000	$	124,480	Nuveen Investments Cl. A	4,900		184,338
K-Swiss Cl. A	2,700		87,318
							397,342
			211,798
				Other Financial Services - 2.7%
Collectibles - 0.6%				†Morningstar a	6,000		168,900
Action Performance Companies a	8,000		70,560	†Nasdaq Stock Market a	7,000		132,020
Home Furnishing and Appliances - 1.0%							300,920
Ethan Allen Interiors	3,200		107,232
				Total (Cost $975,725)			1,186,312
Sports and Recreation - 1.8%
Thor Industries	2,300		72,289	Health – 9.4%
Winnebago Industries	3,900		127,725	Commercial Services - 1.2%
				ICON ADR a,b	3,900		135,330
			200,014
				Drugs and Biotech - 3.4%
Other Consumer Products - 0.8%				Endo Pharmaceuticals Holdings a	5,700		149,796
Fossil a	4,000		90,800	Orchid Cellmark a	9,600		103,776
				Perrigo Company	4,700		65,518
Total (Cost $701,787)			680,404	Priority Healthcare Cl. B a	2,500		63,400
Consumer Services – 8.0%							382,490
Direct Marketing - 1.1%
Nu Skin Enterprises Cl. A	5,500		128,150	Health Services - 1.0%
				On Assignment a	23,100		115,038
Restaurants and Lodgings - 0.5%
CBRL Group	1,500		58,290	Medical Products and Devices - 3.8%
				Arrow International	4,400		140,360
Retail Stores - 5.5%				Invacare Corporation	1,700		75,412
Big Lots a	6,000		79,440	Possis Medical a	7,000		70,910
Borders Group	3,300		83,523	STERIS Corporation	2,500		64,425
Buckle (The)	3,100		137,454	Viasys Healthcare a	3,000		67,770
Claire’s Stores	3,900		93,795
Dress Barn (The) a	3,800		85,994				418,877
Pier 1 Imports	9,300		131,967
				Total (Cost $962,309)			1,051,735
			612,173
				Industrial Products – 17.5%
Other Consumer Services - 0.9%				Automotive - 3.0%
MoneyGram International	5,100		97,512	Adesa	6,000		130,620
				Bandag Cl. A	2,600		105,300
Total (Cost $777,220)			896,125	Gentex Corporation	5,600		101,920
Financial Intermediaries – 2.8%							337,840
Insurance - 1.0%
AmerUs Group	2,300		110,515	Building Systems and Components - 2.2%
				Drew Industries a	3,400		154,360
Securities Brokers - 1.8%				Teleflex	1,500		89,055
E*TRADE Financial a	4,600		64,354
†Investment Technology Group a	6,800		142,936				243,415
			207,290	Machinery - 5.8%
				Briggs & Stratton	3,200		110,784
Total (Cost $289,071)			317,805	†Lincoln Electric Holdings	5,800		192,270
				Pason Systems	7,200		125,171
Financial Services – 10.6%				†Rofin-Sinar Technologies a	3,300		108,240
Information and Processing - 3.7%				Woodward Governor Company	1,400		117,642
eFunds Corporation a	7,500		134,925
Fair Isaac	3,500		127,750				654,107
SEI Investments	4,100		153,135
				Metal Fabrication and Distribution - 0.8%
			415,810	Kaydon Corporation	3,200		89,120
Insurance Brokers - 0.6%				Pumps, Valves and Bearings - 0.8%
Hilb Rogal & Hobbs Company	2,100		72,240	†Franklin Electric	2,400		92,760

50  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

JUNE 30, 2005 (Unaudited)

	SHARES		VALUE		SHARES		VALUE
Industrial Products (continued)				IT Services - 2.2%
Specialty Chemicals and Materials - 1.6%				Keane a	3,300	$	45,210
Balchem Corporation	2,250	$	67,613	Perot Systems Cl. A a	7,700		109,494
MacDermid	3,400		105,944	†Sapient Corporation a	11,100		88,023
			173,557				242,727
Other Industrial Products - 3.3%				Semiconductors and Equipment - 3.4%
Brady Corporation Cl. A	4,500		139,500	†Cabot Microelectronics a	3,700		107,263
HNI Corporation	1,200		61,380	Cognex Corporation	5,300		138,807
Raven Industries	4,100		96,022	Exar Corporation a	9,000		134,010
Smith (A.O.) Corporation	2,900		77,459
							380,080
			374,361
				Software - 3.0%
Total (Cost $1,735,011)			1,965,160	ManTech International Cl. A a	1,400		43,456
				Pegasystems a	11,200		66,080
Industrial Services – 10.6%				†SPSS a	6,700		128,707
Commercial Services - 6.5%				†Verity a	11,600		101,732
†Ceridian Corporation a	5,600		109,088
Copart a	5,400		128,520				339,975
Digital Theater Systems a	4,800		85,584
Kelly Services Cl. A	3,100		88,784	Telecommunications - 2.2%
LECG Corporation a	5,700		121,182	†Foundry Networks a	15,000		129,450
MPS Group a	10,400		97,968	Scientific-Atlanta	3,600		119,772
Viad Corporation	3,500		99,190
							249,222
			730,316
				Total (Cost $1,889,019)			1,898,116
Industrial Distribution - 1.2%
Ritchie Bros. Auctioneers	3,400		131,070	Miscellaneous – 4.4%
				Total (Cost $518,276)			489,377
Printing - 1.0%
Courier Corporation	3,075		118,111	TOTAL COMMON STOCKS
				(Cost $9,334,399)			10,260,611
Transportation and Logistics - 1.9%
Alexander & Baldwin	1,100		50,985	REPURCHASE AGREEMENT – 7.5%
†Universal Truckload Services a	9,500		160,455	State Street Bank & Trust Company, 2.55% dated 6/30/05, due 7/1/05, maturity value $839,059(collateralized by obligations of various U.S. Government Agencies, valued at $862,723)
			211,440
				(Cost $839,000)			839,000
Total (Cost $1,059,235)			1,190,937
				TOTAL INVESTMENTS – 99.0%
				(Cost $10,173,399)			11,099,611
Natural Resources – 5.2%
Energy Services - 2.7%
Ensign Energy Services	5,400		130,328	CASH AND OTHER ASSETS LESS LIABILITIES – 1.0%			108,253
Input/Output a	9,200		57,776
Trican Well Service a	4,800		118,002	NET ASSETS – 100.0%		$	11,207,864
			306,106
Oil and Gas - 2.5%
Cimarex Energy a	3,800		147,858
Holly Corporation	2,800		130,676
			278,534
Total (Cost $426,746)			584,640
Technology – 16.9%
Components and Systems - 4.2%
American Power Conversion	3,200		75,488
Dionex Corporation a	1,400		61,054
†Nam Tai Electronics	5,200		118,248
Technitrol	7,600		107,388
†Tektronix	4,700		109,369
			471,547
Distribution - 0.9%
†Benchmark Electronics a	3,400		103,428
Internet Software and Services - 1.0%
†eResearch Technology a	8,300		111,137

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  51

SCHEDULES OF INVESTMENTS

      Royce Discovery Fund

	SHARES		VALUE		SHARES		VALUE
COMMON STOCKS – 86.6%				†Navigators Group a	700	$	24,199
Consumer Products – 5.0%				Safety Insurance Group	700		23,632
Apparel and Shoes - 2.9%
†Ashworth a	2,400	$	21,624				207,309
Cutter & Buck	1,900		24,510
†Haggar	1,100		22,385	Securities Brokers - 1.4%
Saucony Cl. B	1,100		25,080	†SWS Group	1,300		22,334
				Stifel Financial a	966		23,339
			93,599
							45,673
Home Furnishing and Appliances - 0.7%
National Presto Industries	500		22,035	Total (Cost $341,336)			383,294
Sports and Recreation - 0.7%
†Aldila	1,100		21,516	Financial Services – 2.0%
				Other Financial Services - 2.0%
Other Consumer Products - 0.7%				Encore Capital Group a	1,300		22,100
†JAKKS Pacific a	1,200		23,052	†Medallion Financial	2,400		22,680
				Nicholas Financial	1,650		18,414
Total (Cost $155,278)			160,202
				Total (Cost $63,648)			63,194
Consumer Services – 7.9%
Direct Marketing - 0.7%
Sportsman’s Guide (The) a	1,200		22,500	Health – 18.4%
				Drugs and Biotech - 3.5%
Leisure and Entertainment - 0.7%				Draxis Health a	4,500		22,365
†4Kids Entertainment a	1,100		21,868	†Hi-Tech Pharmacal a	800		25,488
				Lifecore Biomedical a	1,900		20,710
Media and Broadcasting - 0.7%				†Matrixx Initiatives a	2,000		22,000
†Nelson (Thomas)	1,000		21,760	†Stratagene Corporation a	2,600		22,594
Restaurants and Lodgings - 2.1%							113,157
†Benihana Cl. A a	1,500		21,450
Checkers Drive-In Restaurants a	1,600		21,792	Health Services - 3.5%
Sunterra Corporation a	1,500		24,315	†Amedisys a	700		25,746
				Metropolitan Health Networks a	8,000		20,480
			67,557	†NovaMed a	3,700		22,459
				PainCare Holdings a	5,200		22,516
Retail Stores - 2.3%				RehabCare Group a	800		21,384
†Conn’s a	1,000		24,470
†Deb Shops	800		23,176				112,585
Trans World Entertainment a	2,200		26,026
				Medical Products and Devices - 10.7%
			73,672	Anika Therapeutics a	1,800		20,682
				Atrion Corporation	300		22,365
Other Consumer Services - 1.4%				Candela Corporation a	2,400		25,080
ACE Cash Express a	800		20,448	†Cantel Medical a	1,400		22,904
EZCORP Cl. A a	2,200		23,584	†Cholestech Corporation a	2,200		24,794
				†Cutera a	1,300		22,555
			44,032	Kensey Nash a	800		24,192
				Medical Action Industries a	1,400		24,990
Total (Cost $227,475)			251,389	Meridian Bioscience	1,200		22,740
				Microtek Medical Holdings a	6,300		23,121
Financial Intermediaries – 12.0%				Quinton Cardiology Systems a	2,200		17,688
Banking - 4.1%				Schick Technologies a	1,100		24,750
Capital Crossing Bank a	800		27,280	†Utah Medical Products	1,000		21,620
MFC Bancorp a	1,300		24,219	Vital Signs	500		21,660
New Hampshire Thrift Bancshares	904		13,677	†Young Innovations	600		22,398
Provident Financial Holdings	711		19,986
†Republic First Bancorp a	1,600		21,600				341,539
†Taylor Capital Group	600		23,550
				Personal Care - 0.7%
			130,312	CNS	1,000		22,850
Insurance - 6.5%				Total (Cost $550,052)			590,131
†American Equity Investment Life Holding Company	2,000		23,760
American Safety Insurance Holdings a	1,500		22,830	Industrial Products – 8.3%
Capital Title Group	3,250		22,100	Automotive - 0.8%
Ceres Group a	3,600		21,888	†Noble International	1,100		25,905
†Donegal Group Cl. A	1,200		23,952
FPIC Insurance Group a	800		23,464	Industrial Components - 1.1%
Meadowbrook Insurance Group a	4,100		21,484	†Deswell Industries	1,500		23,370
				Gerber Scientific a	1,400		9,744
							33,114

52  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

JUNE 30, 2005 (Unaudited)

	SHARES		VALUE		SHARES		VALUE
Industrial Products (continued)				Components and Systems - 5.2%
Machinery - 1.2%				†Digi International a	2,100	$	24,906
LeCroy Corporation a	1,200	$	16,500	Methode Electronics	1,900		22,553
†Rofin-Sinar Technologies a	700		22,960	Neoware Systems a	2,300		23,552
				†RadiSys Corporation a	1,500		24,225
			39,460	Rimage Corporation a	1,100		23,353
				†SimpleTech a	5,700		21,831
Metal Fabrication and Distribution - 2.5%				†Synaptics a	1,200		25,632
Metal Management	1,000		19,350
Metals USA a	1,300		24,726				166,052
Novamerican Steel a	700		19,320
Roanoke Electric Steel	1,020		16,850	Distribution - 0.7%
				Agilysys	1,400		21,980
			80,246
				Internet Software and Services - 0.7%
Textiles - 0.8%				Imergent a	2,050		21,730
Hallwood Group a	300		25,650
				IT Services - 2.2%
Other Industrial Products - 1.9%				†Covansys Corporation a	1,900		24,415
†Eastern Company (The)	900		21,195	SI International a	900		26,964
EnPro Industries a	900		25,983	TechTeam Global a	1,600		20,864
Oil-Dri Corporation of America	700		12,621
							72,243
			59,799
				Semiconductors and Equipment - 1.3%
Total (Cost $257,580)			264,174	†CalAmp Corporation a	3,000		21,420
				Catalyst Semiconductor a	4,600		20,194
Industrial Services – 7.4%
Commercial Services - 2.3%							41,614
Barrett Business Services a	1,366		20,545
Exponent a	700		20,006	Software - 2.1%
†Gevity HR	1,200		24,036	InterVideo a	1,700		24,446
Innodata Isogen a	3,400		9,996	†MRO Software a	1,600		23,376
				†MapInfo a	2,000		21,020
			74,583
							68,842
Engineering and Construction - 1.5%
Baker (Michael) a	1,400		25,004	Telecommunications - 4.3%
†Keith Companies a	1,000		21,680	†Anaren a	1,800		23,670
				Communications Systems	2,100		21,567
			46,684	†Intervoice a	2,600		22,438
				†Intrado a	1,600		23,936
Food and Tobacco Processors - 0.7%				SpectraLink Corporation	2,100		22,092
M&F Worldwide a	1,700		22,712	†TALK America Holdings a	2,300		23,023
Printing - 0.7%							136,726
CSS Industries	681		23,045
				Total (Cost $586,124)			602,505
Transportation and Logistics - 2.2%
Cronos Group (The)	2,000		22,980	Miscellaneous – 4.7%
MAIR Holdings a	2,800		24,752	Total (Cost $161,472)			151,478
Vitran Corporation Cl. A a	1,400		22,120
				TOTAL COMMON STOCKS
			69,852	(Cost $2,633,095)			2,771,239
Total (Cost $214,033)			236,876	REPURCHASE AGREEMENT – 13.7%
				State Street Bank & Trust Company,
Natural Resources – 2.1%				2.55% dated 6/30/05, due 7/1/05,
Oil and Gas - 1.4%				maturity value $439,031
†Callon Petroleum a	1,500		22,170	(collateralized by obligations of various
VAALCO Energy a	6,200		21,452	U.S. Government Agencies, valued at $452,335)
				(Cost $439,000)			439,000
			43,622
Real Estate - 0.7%				TOTAL INVESTMENTS – 100.3%
Bluegreen Corporation a	1,400		24,374	(Cost $3,072,095)			3,210,239
Total (Cost $76,097)			67,996	LIABILITIES LESS CASH
				AND OTHER ASSETS – (0.3)%			(11,107	)
Technology – 18.8%
Aerospace and Defense - 2.3%				NET ASSETS – 100.0%		$	3,199,132
Herley Industries a	1,300		23,712
Innovative Solutions and Support a	600		20,142
MTC Technologies a	800		29,464
			73,318

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  53

SCHEDULES OF INVESTMENTS

      Royce Financial Services Fund

	SHARES		VALUE		SHARES		VALUE
COMMON STOCKS – 94.1%				Securities Brokers - 5.6%
Consumer Services – 1.3%				E*TRADE Financiala	1,600	$	22,384
Other Consumer Services - 1.3%				First Albany	2,000		11,920
MoneyGram International	1,000	$	19,120	Friedman, Billings, Ramsey Group Cl. A	1,300		18,590
				Knight Capital Group Cl. Aa	800		6,096
Total (Cost $19,367)			19,120	Piper Jaffray Companiesa	100		3,043
				Sanders Morris Harris Group	500		8,600
Diversified Investment Companies – 0.6%				†Stifel Financiala	500		12,080
Closed-End Mutual Funds - 0.6%
Central Fund of Canada Cl. A	1,700		9,010				82,713
Total (cost $10,707)			9,010	Total (cost $702,009)			712,473
Financial Intermediaries – 48.0%				Financial Services – 42.0%
Banking - 23.4%				Information and Processing - 7.6%
Abigail Adams National Bancorp	1,100		17,875	Advent Softwarea	500		10,130
Bancorp Rhode Island	500		18,300	Fair Isaac	1,500		54,750
Bank of Hawaii	200		10,150	Interactive Data	500		10,390
Bank of NT Butterfield	1,000		41,500	SEI Investments	1,000		37,350
Center Bancorp	1,260		14,301
Central Pacific Financial	1,000		35,600				112,620
†Commercial National Financial	1,100		22,011
HopFed Bancorp	600		9,426	Insurance Brokers - 4.7%
International Bancshares	625		17,681	Brown & Brown	1,000		44,940
MAF Bancorp	700		29,841	Gallagher (Arthur J.) & Company	300		8,139
Mercantile Bankshares	200		10,306	Hilb Rogal & Hobbs Company	500		17,200
Partners Trust Financial Group	1,000		10,680
Peapack-Gladstone Financial	1,210		33,517				70,279
Provident Financial Services	600		10,542
Severn Bancorp	800		14,576	Investment Management - 23.3%
Susquehanna Bancshares	400		9,836	Alliance Capital Management Holding L.P.	1,600		74,784
Timberland Bancorp	500		11,225	Apollo Investment	1,545		28,475
Umpqua Holdings	400		9,416	Epoch Holdinga	11,700		50,310
Whitney Holding	300		9,789	Federated Investors Cl. B	1,400		42,014
Wilmington Trust	300		10,803	IGM Financial	200		6,146
				International Assets Holdinga	1,000		6,150
			347,375	MCG Capital	1,000		17,080
				MVC Capital	2,000		20,000
Insurance - 17.0%				Nuveen Investments Cl. A	1,700		63,954
Alleghany Corporationa	102		30,294	T. Rowe Price Group	200		12,520
American National Insurance	200		22,938	U.S. Global Investors Cl. Aa	5,000		23,600
Argonaut Groupa	800		18,472
Aspen Insurance Holdings	1,400		38,584				345,033
Baldwin & Lyons Cl. B	1,500		36,150
CNA Suretya	500		7,425	Other Financial Services - 6.4%
Erie Indemnity Company Cl. A	200		10,850	CharterMac	500		10,980
Infinity Property & Casualty	700		24,416	Credit Acceptancea	1,100		16,379
Montpelier Re Holdings	300		10,374	†Morningstara	1,500		42,225
†Ohio Casualty	500		12,090	Municipal Mortgage & Equity	400		10,396
RLI	300		13,380	World Acceptancea	500		15,025
Transatlantic Holdings	500		27,910
							95,005
			252,883
				Total (cost $523,783)			622,937
Real Estate Investment Trusts - 2.0%
†Captial Trust Cl. A	600		20,046	Industrial Services – 2.2%
Gladstone Commercial	600		9,456	Commercial Services - 2.2%
				Viad Corporation	250		7,085
			29,502	Watson Wyatt & Company Holdings	1,000		25,630
				Total (cost $29,565)			32,715
				TOTAL COMMON STOCKS
				(cost $1,285,431)			1,396,255

54  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

JUNE 30, 2005 (Unaudited)
	Royce Dividend Value Fund

	VALUE				SHARES	VALUE
REPURCHASE AGREEMENT – 6.0%				COMMON STOCKS – 85.3%
State Street Bank & Trust Company,				Consumer Products – 3.7%
2.55% dated 6/30/05, due 7/1/05,				Apparel and Shoes - 1.4%
maturity value $88,006				K-Swiss Cl. A	700	$	22,638
(collateralized by obligations of various				Polo Ralph Lauren Cl. A	500		21,555
U.S. Government Agencies, valued at $93,159)
(cost $88,000)	$	88,000					44,193
TOTAL INVESTMENTS – 100.1%				Collectibles - 0.4%
(cost $1,373,431)		1,484,255		†Action Performance Companiesa	1,500		13,230
LIABILITIES LESS CASH AND OTHER ASSETS – (0.1)%		(954	)	Home Furnishing and Appliances - 1.9%
				Ethan Allen Interiors	700		23,457
NET ASSETS – 100.0%	$	1,483,301		Furniture Brands International	800		17,288
				Natuzzi ADRb	2,000		16,280
				Total (cost $109,789)			114,448
				Consumer Services – 6.2%
				Leisure and Entertainment - 0.5%
				Regal Entertainment Group Cl. A	800		15,104
				Restaurants and Lodgings - 0.4%
				CBRL Group	300		11,658
				Retail Stores - 4.1%
				†Borders Group	1,400		35,434
				Claire’s Stores	1,600		38,480
				Dress Barn (The)a	600		13,578
				Pier 1 Imports	1,800		25,542
				Talbots	400		12,988
							126,022
				Other Consumer Services - 1.2%
				MoneyGram International	2,000		38,240
				Total (cost $182,433)			191,024
				Financial Intermediaries – 13.3%
				Banking - 6.8%
				Arrow Financial	500		13,920
				BOK Financial	600		27,672
				†Bank of NT Butterfield	500		20,750
				Boston Private Financial Holdings	1,300		32,760
				†Canadian Western Bank	1,200		28,237
				Fauquier Bankshares	900		23,400
				Peapack-Gladstone Financial	1,000		27,700
				†Whitney Holding	1,000		32,630
							207,069
				Insurance - 2.6%
				Alleghany Corporationa	102		30,294
				Erie Indemnity Company Cl. A	400		21,700
				Transatlantic Holdings	500		27,910
							79,904
				Real Estate Investment Trusts - 3.1%
				†Captial Trust Cl. A	2,300		76,843
				Gladstone Commercial	1,200		18,912
							95,755
				Securities Brokers - 0.8%
				Friedman, Billings, Ramsey Group Cl. A	1,700		24,310
				Total (cost $408,006)			407,038

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  55

SCHEDULES OF INVESTMENTS

      Royce Dividend Value Fund (continued)

	SHARES		VALUE		SHARES		VALUE
Financial Services – 24.7%				Industrial Services – 4.2%
Information and Processing - 4.2%				Commercial Services - 1.9%
Fair Isaac	1,000	$	36,500	ALLETE	600	$	29,940
SEI Investments	2,500		93,375	Central Parking	600		8,250
				Kelly Services Cl. A	500		14,320
			129,875	Viad Corporation	250		7,085
Insurance Brokers - 6.9%							59,595
Aon Corporation	1,000		25,040
Brown & Brown	1,200		53,928	Transportation and Logistics - 0.9%
Gallagher (Arthur J.) & Company	3,300		89,529	Alexander & Baldwin	600		27,810
Hilb Rogal & Hobbs Company	1,200		41,280
				Other Industrial Services - 1.4%
			209,777	Landauer	800		41,528
Investment Management - 13.6%				Total (Cost $111,507)			128,933
Alliance Capital Management Holding L.P.	3,200		149,568
Apollo Investment	1,030		18,984	Natural Resources – 0.8%
Federated Investors Cl. B	2,500		75,025	Energy Services - 0.8%
Gabelli Asset Management Cl. A	500		22,095	Helmerich & Payne	500		23,460
MCG Capital	1,000		17,080
MVC Capital	1,500		15,000	Total (Cost $15,470)			23,460
Nuveen Investments Cl. A	1,500		56,430
†T. Rowe Price Group	1,000		62,600	Technology – 14.4%
				Aerospace and Defense - 0.9%
			416,782	†HEICO Corporation Cl. A	1,500		27,030
Total (Cost $698,908)			756,434	Components and Systems - 9.0%
				AVX Corporation	2,000		24,240
Health – 1.1%				American Power Conversion	1,000		23,590
Medical Products and Devices - 1.1%				†Analogic Corporation	700		35,224
Applera Corporation- Applied				Dionex Corporationa	1,000		43,610
Biosystems Group	800		15,736	Lowrance Electronics	1,500		31,530
Arrow International	600		19,140	†Nam Tai Electronics	1,700		38,658
				Technitrol	3,300		46,629
Total (Cost $32,864)			34,876	†Tektronix	1,400		32,578
Industrial Products – 14.0%							276,059
Automotive - 2.6%
Adesa	2,300		50,071	IT Services - 0.7%
CLARCOR	1,000		29,250	Syntel	1,200		19,236
			79,321	Semiconductors and Equipment - 1.0%
				Cognex Corporation	1,200		31,428
Machinery - 4.7%
Briggs & Stratton	800		27,696	Telecommunications - 2.8%
Lincoln Electric Holdings	1,600		53,040	†North Pittsburgh Systems	1,500		29,340
Nordson Corporation	800		27,424	Scientific-Atlanta	1,700		56,559
Stewart & Stevenson Services	1,500		33,990
							85,899
			142,150
				Total (Cost $431,364)			439,652
Pumps, Valves and Bearings - 1.9%
Franklin Electric	1,500		57,975	Utilities – 1.5%
				Aqua America	1,500		44,610
Specialty Chemicals and Materials - 2.6%
Balchem Corporation	750		22,537	Total (Cost $33,195)			44,610
MacDermid	1,300		40,508
Quaker Chemical	1,000		17,450	Miscellaneous – 1.4%
				Total (Cost $46,368)			42,757
			80,495
				TOTAL COMMON STOCKS
Other Industrial Products - 2.2%				(Cost $2,477,276)			2,609,809
†Brady Corporation Cl. A	1,000		31,000
Quixote Corporation	1,000		19,610
Smith (A.O.) Corporation	600		16,026
			66,636
Total (Cost $407,372)			426,577

56  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

JUNE 30, 2005 (Unaudited)

	SHARES		VALUE
PREFERRED STOCKS – 1.5%
Central Parking Finance Trust 5.25% Conv.	1,000	$	20,000
First Union Real Estate Equity & Mortgage
Investments Ser. A 8.40% Conv.	1,000		24,800
TOTAL PREFERRED STOCKS
(cost $44,082)			44,800
CORPORATE BONDS – 3.0%
†Athena Neurosciences Finance 7.25%
Senior Note due 2/21/08	100,000		93,000
TOTAL CORPORATE BONDS
(cost $83,093)			93,000
REPURCHASE AGREEMENT – 22.6%
State Street Bank & Trust Company,
2.55% dated 6/30/05, due 7/1/05,
maturity value $691,049
(collateralized by obligations of various
U.S. Government Agencies
valued at $711,615)
(cost $691,000)			691,000
TOTAL INVESTMENTS – 112.4%
(cost $3,295,451)			3,438,609
LIABILITIES LESS CASH AND OTHER ASSETS – (12.4)%			(379,866	)
NET ASSETS - 100.0%		$	3,058,743

a	Non-income producing.
b	American Depository Receipt.
c	At June 30, 2005, the Fund owned 5% or more of the Company’s outstanding voting securities thereby making the Company an Affiliated Company as that term is
	defined in the Investment Company Act of 1940. See notes to financial statements.
d	A portion of these securities were on loan at June 30, 2005.
e	When issued.
†	New additions in 2005 (unaudited).
	Bold indicates a Fund’s largest 20 equity holdings in terms of June 30, 2005 market value.

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  57

STATEMENTS OF ASSETS AND LIABILITIES

		Pennsylvania Mutual Fund			Royce Micro-Cap Fund			Royce Premier Fund			Royce Low-Priced Stock Fund
ASSETS:
Investments at value
(including collateral on loaned securities)*
Non-Affiliates	$	1,907,754,379		$	534,494,342		$	2,035,401,363		$	2,778,593,606
Affiliated Companies		124,660,595			7,479,948			861,780,962			924,455,481
Repurchase agreements (at cost and value)		309,452,000			66,673,000			452,559,000			336,231,000
Cash		765			508,928			18,372			885,375
Receivable for investments sold		2,194,701			1,771,400			3,864,771			10,721,840
Receivable for capital shares sold		6,194,958			658,478			6,719,472			6,696,082
Receivable for dividends and interest		842,965			183,657			2,492,109			1,827,284
Prepaid expenses and other assets		23,883			7,533			36,907			52,192
Total Assets		2,351,124,246			611,777,286			3,362,872,956			4,059,462,860
LIABILITIES:
Payable for collateral on loaned securities		44,505,248			10,897,839			194,592			64,289,083
Payable for investments purchased		10,075,850			36,100			12,639,977			6,674,669
Payable for capital shares redeemed		1,520,279			702,987			4,330,697			18,248,270
Payable for investment advisory fees		1,399,583			638,326			2,665,613			4,111,131
Accrued expenses		621,475			214,449			993,550			1,506,343
Total Liabilities		58,122,435			12,489,701			20,824,429			94,829,496
Net Assets	$	2,293,001,811		$	599,287,585		$	3,342,048,527		$	3,964,633,364
ANALYSIS OF NET ASSETS:
Paid-in capital	$	1,652,946,270		$	459,649,176		$	2,482,341,185		$	3,278,704,057
Undistributed net investment income (loss)		(6,166,060	)		(6,085,768	)		(1,610,313	)		(29,957,918	)
Accumulated net realized gain (loss) on investments		81,464,174			52,811,497			129,124,018			225,279,900
Net unrealized appreciation (depreciation) on investments		564,757,427			92,912,680			732,193,637			490,607,325
Net Assets	$	2,293,001,811		$	599,287,585		$	3,342,048,527		$	3,964,633,364
Investment Class	$	1,487,086,904		$	436,851,397		$	2,789,777,611		$	3,964,633,364
Consultant Class	$	805,914,907		$	155,671,593		$	35,645,326
Institutional Class				$	5,742,311		$	175,676,019
Financial Intermediary Class				$	1,022,284		$	95,671,723
W Class							$	245,277,848
SHARES OUTSTANDING:
(unlimited number of $.001 par value shares authorized for each Fund)
Investment Class		142,982,710			28,754,541			184,839,129			269,555,317
Consultant Class		80,849,211			10,845,199			2,425,225
Institutional Class					376,964			11,616,063
Financial Intermediary Class					67,456			6,364,769
W Class								16,252,567
NET ASSET VALUES:
(Net Assets ÷ Shares Outstanding)
Investment Class (1)		$10.40			$15.19			$15.09			$14.71
Consultant Class (1)		$9.97			$14.35			$14.70
Institutional Class (2)					$15.23			$15.12
Financial Intermediary Class (2)					$15.15			$15.03
W Class (2)								$15.09
* Investments at identified cost	$	1,467,657,547		$	449,061,610		$	2,164,988,688		$	3,212,441,762
Market value of loaned securities	$	43,179,922		$	7,203,552		$	187,362		$	60,614,838

(1)	Offering and redemption price per share; shares redeemed within six months of purchase are subject to a 1% redemption fee, payable to the Fund.
(2)	Offering and redemption price per share.

58  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

JUNE 30, 2005 (Unaudited)

		Royce		Royce			Royce			Royce
		Total Return		TrustShares			Opportunity			Special Equity
		Fund		Fund			Fund			Fund
ASSETS:
Investments at value
(including collateral on loaned securities)*
Non-Affiliates	$	4,644,853,105	$	50,722,317		$	1,853,658,538		$	716,242,626
Affiliated Companies		105,180,379		–			77,933,001			119,738,518
Repurchase agreements (at cost and value)		314,821,000		1,410,000			127,204,000			77,513,000
Cash		29,273		3,375			125,520			29,335
Receivable for investments sold		39,938,708		1,720,212			6,721,910			1,324,380
Receivable for capital shares sold		12,855,701		39,000			2,946,550			847,661
Receivable for dividends and interest		10,588,980		27,468			626,037			566,641
Prepaid expenses and other assets		54,565		620			23,542			11,834
Total Assets		5,128,321,711		53,922,992			2,069,239,098			916,273,995
LIABILITIES:
Payable for collateral on loaned securities		14,790,068		–			186,025,434			4,333,924
Payable for investments purchased		34,794,107		937,987			14,098,962			916,849
Payable for capital shares redeemed		3,744,258		–			1,989,980			966,249
Payable for investment advisory fees		3,935,412		43,668			1,529,892			751,755
Accrued expenses		1,578,856		35,888			506,496			243,736
Total Liabilities		58,842,701		1,017,543			204,150,764			7,212,513
Net Assets	$	5,069,479,010	$	52,905,449		$	1,865,088,334		$	909,061,482
ANALYSIS OF NET ASSETS:
Paid-in capital	$	3,996,478,193	$	41,524,096		$	1,437,836,135		$	731,141,749
Undistributed net investment income (loss)		2,549,308		(151,739	)		(4,339,384	)		2,411,947
Accumulated net realized gain (loss) on investments		133,330,476		6,803,435			188,723,706			16,635,303
Net unrealized appreciation (depreciation) on investments		937,121,033		4,729,657			242,867,877			158,872,483
Net Assets	$	5,069,479,010	$	52,905,449		$	1,865,088,334		$	909,061,482
Investment Class	$	3,967,099,693	$	50,904,807		$	1,501,513,548		$	713,443,574
Consultant Class	$	556,459,702	$	2,000,642					$	19,156,105
Institutional Class	$	146,498,153				$	171,392,756		$	163,221,521
Financial Intermediary Class	$	297,207,453				$	192,182,030		$	13,240,282
W Class	$	102,214,009
SHARES OUTSTANDING:
(unlimited number of $.001 par value
shares authorized for each Fund)
Investment Class		320,080,765		4,121,459			116,673,921			37,235,844
Consultant Class		45,002,802		175,890						1,012,803
Institutional Class		11,785,410					13,276,152			8,528,557
Financial Intermediary Class		24,245,486					15,099,914			693,523
W Class		8,237,282
NET ASSET VALUES:
(Net Assets ÷ Shares Outstanding)
Investment Class (1)		$12.39		$12.35			$12.87			$19.16
Consultant Class (1)		$12.37		$11.37						$18.91
Institutional Class (2)		$12.43					$12.91			$19.14
Financial Intermediary Class (2)		$12.26					$12.73			$19.09
W Class (2)		$12.41
* Investments at identified cost	$	3,812,912,451	$	45,992,660		$	1,688,723,662		$	677,108,661
Market value of loaned securities	$	9,982,428	$	–		$	178,286,860		$	4,324,800

(1)	Offering and redemption price per share; shares redeemed within six months of purchase are subject to a 1% redemption fee, payable to the Fund (2% for Royce TrustShares Fund within three years of purchase).
(2)	Offering and redemption price per share.

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  59

STATEMENTS OF ASSETS AND LIABILITIES

		Royce Select Fund		Royce Value Fund			Royce Value Plus Fund			Royce Technology Value Fund
ASSETS:
Investments at value*
Non-Affiliates	$	19,993,114	$	53,949,148		$	193,083,227		$	24,480,721
Repurchase agreements (at cost and value)		2,886,000		8,715,000			15,956,000			4,041,000
Cash		53		857			529			1,021
Receivable for investments sold		520,937		2,674			5,302,606			1,773,271
Receivable for capital shares sold		–		216,044			865,845			9,295
Receivable for dividends and interest		13,572		19,900			77,857			286
Prepaid expenses and other assets		–		500			2,483			432
Total Assets		23,413,676		62,904,123			215,288,547			30,306,026
LIABILITIES:
Payable for investments purchased		177,505		1,112,978			3,303,553			663,395
Payable for capital shares redeemed		–		177,226			1,594,467			95,517
Payable for investment advisory fees		–		49,407			174,211			37,431
Accrued expenses		–		33,959			69,256			20,399
Total Liabilities		177,505		1,373,570			5,141,487			816,742
Net Assets	$	23,236,171	$	61,530,553		$	210,147,060		$	29,489,284
ANALYSIS OF NET ASSETS:
Paid-in capital	$	16,059,005	$	55,652,664		$	197,564,636		$	31,866,871
Undistributed net investment income (loss)		174,782		(130,022	)		(858,856	)		(260,598	)
Accumulated net realized gain (loss) on investments		3,233,749		1,225,216			4,727,775			(332,746	)
Net unrealized appreciation (depreciation) on investments		3,768,635		4,782,695			8,713,505			(1,784,243	)
Net Assets	$	23,236,171	$	61,530,553		$	210,147,060		$	29,489,284
Investment Class	$	23,236,171	$	61,530,553		$	210,147,060		$	29,489,284
SHARES OUTSTANDING:
(unlimited number of $.001 par value
shares authorized for each Fund)
Investment Class		114,552		7,188,689			20,294,939			4,790,213
NET ASSET VALUES:
(Net Assets ÷ Shares Outstanding)
Investment Class (1)		$202.84		$8.56			$10.35			$6.16
* Investments at identified cost	$	16,224,479	$	49,166,453		$	184,369,722		$	26,264,964

⁽¹⁾ Offering and redemption price per share; shares redeemed within six months of purchase are subject to a 1% redemption fee, payable to the Fund (2% for Royce Select Fund within three years of purchase and 2% for Royce Technology Value Fund within six months of purchase).

60  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

JUNE 30, 2005 (Unaudited)

	Royce 100 Fund			Royce Discovery Fund			Royce Financial Services Fund		Royce Dividend Value Fund
ASSETS:
Investments at value*
Non-Affiliates	$	10,260,611		$	2,771,239		$	1,396,255	$	2,747,609
Repurchase agreements (at cost and value)		839,000			439,000			88,000		691,000
Cash		499			2,725			1,730		–
Receivable for investments sold		118,464			–			–		–
Receivable for capital shares sold		29,020			254			–		4,979
Receivable for dividends and interest		6,839			866			2,764		7,989
Prepaid expenses and other assets		109			37			17		20
Total Assets		11,254,542			3,214,121			1,488,766		3,451,597
LIABILITIES:
Payable for investments purchased		–			–			–		386,311
Payable for capital shares redeemed		25,178			–			–		–
Payable for investment advisory fees		6,076			–			–		–
Payable to custodian for cash overdrawn		–			–			–		924
Accrued expenses		15,424			14,989			5,465		5,619
Total Liabilities		46,678			14,989			5,465		392,854
Net Assets	$	11,207,864		$	3,199,132		$	1,483,301	$	3,058,743
ANALYSIS OF NET ASSETS:
Paid-in capital	$	9,766,127		$	2,834,995		$	1,352,069	$	2,908,866
Undistributed net investment income (loss)		(25,073	)		(12,667	)		6,776		2,057
Accumulated net realized gain (loss) on investments		540,598			238,660			13,632		4,662
Net unrealized appreciation (depreciation) on investments		926,212			138,144			110,824		143,158
Net Assets	$	11,207,864		$	3,199,132		$	1,483,301	$	3,058,743
Investment Class	$	11,207,864		$	3,199,132		$	1,483,301	$	3,058,743
SHARES OUTSTANDING:
(unlimited number of $.001 par value shares authorized for each Fund)
Investment Class		1,632,418			507,944			265,344		549,809
NET ASSET VALUES:
(Net Assets ÷ Shares Outstanding)
Investment Class (1)	$	6.87		$	6.30		$	5.59	$	5.56
* Investments at identified cost	$	9,334,399		$	2,633,095		$	1,285,431	$	2,604,451
(1) Offering and redemption price per share; shares redeemed within six months of purchase are subject to a 1% redemption fee, payable to the Fund.

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  61

STATEMENTS OF CHANGES IN NET ASSETS

	Pennsylvania Mutual Fund						Royce Micro-Cap Fund						Royce Premier Fund
	Six months ended 6/30/05 (unaudited)			Year ended 12/31/04			Six months ended 6/30/05 (unaudited)			Year ended 12/31/04			Six months ended 6/30/05 (unaudited)			Year ended 12/31/04
INVESTMENT OPERATIONS:
Net investment income (loss)	$	(2,482,756	)	$	(9,162,190	)	$	(2,914,040	)	$	(7,119,421	)	$	(1,610,313	)	$	(10,423,588	)
Net realized gain (loss) on investments		64,898,947			113,934,931			40,357,129			67,207,876			132,082,952			118,466,810
Net change in unrealized appreciation (depreciation) on investments		(6,473,810	)		198,326,330			(60,774,934	)		27,022,698			(134,266,124	)		398,822,087
Net increase (decrease) in net assets from investment operations		55,942,381			303,099,071			(23,331,845	)		87,111,153			(3,793,485	)		506,865,309
DISTRIBUTIONS:
Net investment income
Investment Class		–			–			–			–			–			–
Consultant Class		–			–			–			–			–			–
Institutional Class								–			–			–			–
Financial Intermediary Class								–			–			–			–
W Class														–
Net realized gain on investments
Investment Class		–			(60,341,929	)		–			(42,716,301	)		–			(131,048,297	)
Consultant Class		–			(37,887,815	)		–			(15,620,233	)		–			(1,153,428	)
Institutional Class								–			(528,342	)		–			(3,776,526	)
Financial Intermediary Class								–			(102,415	)		–			(3,176,505	)
W Class														–
Total distributions		–			(98,229,744	)		–			(58,967,291	)		–			(139,154,756	)
CAPITAL SHARE TRANSACTIONS:
Value of shares sold
Investment Class		320,293,864			399,764,759			53,740,955			80,412,061			444,393,056			1,161,984,791
Consultant Class		100,990,684			220,269,642			12,839,625			28,203,606			11,532,748			20,355,465
Institutional Class								14,215			–			89,769,791			78,625,319
Financial Intermediary Class								111,031			1,018,173			39,905,865			49,666,056
W Class														235,943,453
Distributions reinvested
Investment Class		–			47,785,285			–			40,183,518			–			123,888,623
Consultant Class		–			37,209,584			–			15,393,303			–			1,127,437
Institutional Class								–			528,340			–			3,009,484
Financial Intermediary Class								–			102,412			–			3,176,504
W Class														–
Value of shares redeemed
Investment Class		(115,964,175	)		(176,169,523	)		(73,742,515	)		(101,639,890	)		(612,635,482	)		(375,088,516	)
Consultant Class		(64,888,376	)		(61,434,358	)		(20,305,037	)		(23,650,795	)		(2,701,857	)		(2,013,525	)
Institutional Class								(13,178	)		(5,000,000	)		(20,541,379	)		(8,740,165	)
Financial Intermediary Class								(205,034	)		(173,375	)		(14,620,352	)		(22,484,759	)
W Class														(1,887,609	)
Shareholder redemption fees
Investment Class		143,375			91,236			23,201			38,721			270,095			374,927
Consultant Class		36,613			18,776			7,035			4,063			4,678			1,791
Net increase (decrease) in net assets from capital share transactions		240,611,985			467,535,401			(27,529,702	)		35,420,137			169,433,007			1,033,883,432
NET INCREASE (DECREASE) IN NET ASSETS		296,554,366			672,404,728			(50,861,547	)		63,563,999			165,639,522			1,401,593,985
NET ASSETS:
Beginning of period		1,996,447,445			1,324,042,717			650,149,132			586,585,133			3,176,409,005			1,774,815,020
End of period	$	2,293,001,811		$	1,996,447,445		$	599,287,585		$	650,149,132		$	3,342,048,527		$	3,176,409,005
UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) AT END OF PERIOD	$	(6,166,060	)	$	(3,683,304	)	$	(6,085,768	)	$	(3,171,728	)	$	(1,610,313	)	$	–

62  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

		Royce Low-Priced Stock Fund						Royce Total Return Fund						Royce TrustShares Fund
		Six months ended 6/30/05 (unaudited)			Year ended 12/31/04			Six months ended 6/30/05 (unaudited)			Year ended 12/31/04			Six months ended 6/30/05 (unaudited)			Year ended 12/31/04
INVESTMENT OPERATIONS:
Net investment income (loss)	$	(13,528,083	)	$	(39,235,326	)	$	20,201,139		$	34,596,972		$	(151,739	)	$	(530,216	)
Net realized gain (loss) on investments		195,383,289			223,686,531			93,127,137			90,736,052			4,105,305			8,922,430
Net change in unrealized appreciation (depreciation) on investments		(385,967,088	)		328,519,772			(36,110,823	)		501,980,794			(6,691,209	)		492,000
Net increase (decrease) in net assets from investment operations		(204,111,882	)		512,970,977			77,217,453			627,313,818			(2,737,643	)		8,884,214
DISTRIBUTIONS:
Net investment income
Investment Class		–			–			(15,888,055	)		(32,072,227	)		–			–
Consultant Class								–			(482,963	)		–			–
Institutional Class								(700,143	)		(1,088,201	)
Financial Intermediary Class								(934,824	)		(1,891,793	)
Consultant B Class																	–
W Class								(156,008	)
Net realized gain on investments
Investment Class		–			(166,436,268	)		–			(50,201,250	)		–			(4,848,120	)
Consultant Class								–			(6,748,606	)		–			(189,655	)
Institutional Class								–			(1,613,788	)
Financial Intermediary Class								–			(3,553,954	)
Consultant B Class																	(1,050,854	)
W Class								–
Total distributions		–			(166,436,268	)		(17,679,030	)		(97,652,782	)		–			(6,088,629	)
CAPITAL SHARE TRANSACTIONS:
Value of shares sold
Investment Class		344,382,585			2,166,338,469			712,220,060			1,463,527,509			1,059,950			9,773,344
Consultant Class								79,909,310			164,755,546			273,981			902,341
Institutional Class								36,259,330			49,918,077
Financial Intermediary Class								61,739,358			135,644,866
Consultant B Class																	–
W Class								99,309,156
Distributions reinvested
Investment Class		–			157,688,991			14,215,434			74,978,512			–			4,847,313
Consultant Class								–			7,090,653			–			189,652
Institutional Class								592,081			2,398,034
Financial Intermediary Class								860,387			5,222,998
Consultant B Class																	1,045,335
W Class								155,965
Value of shares redeemed
Investment Class		(945,165,652	)		(947,839,560	)		(542,594,140	)		(517,963,364	)		(415,197	)		(313,936	)
Consultant Class								(31,655,204	)		(37,176,274	)		(51,924	)		(6,325	)
Institutional Class								(16,302,215	)		(9,717,484	)
Financial Intermediary Class								(30,353,190	)		(40,612,557	)
Consultant B Class																	(6,874,460	)
W Class								(654,557	)
Shareholder redemption fees
Investment Class		110,980			594,267			239,102			368,761			410			–
Consultant Class								15,195			14,820			–			–
Net increase (decrease) in net assets from capital share transactions		(600,672,087	)		1,376,782,167			383,956,072			1,298,450,097			867,220			9,563,264
NET INCREASE (DECREASE) IN NET ASSETS		(804,783,969	)		1,723,316,876			443,494,495			1,828,111,133			(1,870,423	)		12,358,849
NET ASSETS:
Beginning of period		4,769,417,333			3,046,100,457			4,625,984,515			2,797,873,382			54,775,872			42,417,023
End of period	$	3,964,633,364		$	4,769,417,333		$	5,069,479,010		$	4,625,984,515		$	52,905,449		$	54,775,872
UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) AT END OF PERIOD	$	(29,957,918	)	$	(16,429,835	)	$	2,549,308		$	27,199		$	(151,739	)	$	–

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  63

STATEMENTS OF CHANGES IN NET ASSETS
	Royce Opportunity Fund						Royce Special Equity Fund						Royce Select Fund
	Six months ended 6/30/05 (unaudited)			Year ended 12/31/04			Six months ended 6/30/05 (unaudited)			Year ended 12/31/04			Six months ended 6/30/05 (unaudited)			Year ended 12/31/04
INVESTMENT OPERATIONS:
Net investment income (loss)	$	(4,339,384	)	$	(9,943,620	)	$	2,332,867		$	9,241,916		$	174,782		$	(352,103	)
Net realized gain (loss) on investments		151,361,340			178,518,721			12,712,836			32,693,728			2,342,218			4,485,342
Net change in unrealized appreciation (depreciation) on investments		(221,316,169	)		121,887,282			(41,224,470	)		76,504,323			(3,275,807	)		(102,053	)
Net increase (decrease) in net assets from investment operations		(74,294,213	)		290,462,383			(26,178,767	)		118,439,967			(758,807	)		4,031,186
DISTRIBUTIONS:
Net investment income
Investment Class		–			–			–			(7,804,108	)		–			–
Consultant Class								–			(9,894	)
Institutional Class		–			–			–			(1,245,981	)
Financial Intermediary Class		–			–			–			(102,853	)
Net realized gain on investments
Investment Class		–			(110,004,477	)		–			(28,374,174	)		–			(2,900,802	)
Consultant Class								–			(671,126	)
Institutional Class		–			(12,522,158	)		–			(4,149,128	)
Financial Intermediary Class		–			(14,918,769	)		–			(416,903	)
Total distributions		–			(137,445,404	)		–			(42,774,167	)		–			(2,900,802	)
CAPITAL SHARE TRANSACTIONS:
Value of shares sold
Investment Class		147,408,985			527,003,633			40,205,409			254,497,176			556,676			3,156,947
Consultant Class								1,102,616			9,564,013
Institutional Class		28,350,298			104,750,852			22,756,096			147,561,017
Financial Intermediary Class		33,897,452			139,480,482			1,723,525			11,091,090
Distributions reinvested
Investment Class		–			99,601,474			–			32,599,944			–			2,705,223
Consultant Class								–			660,502
Institutional Class		–			10,085,826			–			5,086,493
Financial Intermediary Class		–			14,915,105			–			519,755
Value of shares redeemed
Investment Class		(264,663,954	)		(387,748,729	)		(161,715,059	)		(221,070,970	)		(1,482,636	)		(3,729,945	)
Consultant Class								(1,627,656	)		(1,215,274	)
Institutional Class		(43,024,766	)		(19,531,141	)		(18,673,380	)		(8,167,573	)
Financial Intermediary Class		(63,056,588	)		(29,616,118	)		(924,329	)		(4,780,528	)
Shareholder redemption fees
Investment Class		51,680			588,945			17,513			259,712			3,974			14,660
Consultant Class								182			661
Net increase (decrease) in net assets from capital share transactions		(161,036,893	)		459,530,329			(117,135,083	)		226,606,018			(921,986	)		2,146,885
NET INCREASE (DECREASE) IN NET ASSETS		(235,331,106	)		612,547,308			(143,313,850	)		302,271,818			(1,680,793	)		3,277,269
NET ASSETS:
Beginning of period		2,100,419,440			1,487,872,132			1,052,375,332			750,103,514			24,916,964			21,639,695
End of period	$	1,865,088,334		$	2,100,419,440		$	909,061,482		$	1,052,375,332		$	23,236,171		$	24,916,964
UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) AT END OF PERIOD	$	(4,339,384	)	$	–		$	2,411,947		$	79,080		$	174,782		$	–

64  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

	Royce Value Fund						Royce Value Plus Fund						Royce Technology Value Fund
	Six months ended 6/30/05 (unaudited)			Year ended 12/31/04			Six months ended 6/30/05 (unaudited)			Year ended 12/31/04			Six months ended 6/30/05 (unaudited)			Year ended 12/31/04
INVESTMENT OPERATIONS:
Net investment income (loss)	$	(130,022	)	$	(91,248	)	$	(612,466	)	$	(652,371	)	$	(260,598	)	$	(1,164,571	)
Net realized gain (loss) on investments		1,058,846			903,640			4,501,180			1,502,509			(703,309	)		5,710,431
Net change in unrealized appreciation (depreciation) on investments		582,460			3,511,843			(17,758,799	)		23,013,806			(2,334,111	)		(14,480,226	)
Net increase (decrease) in net assets from investment operations		1,511,284			4,324,235			(13,870,085	)		23,863,944			(3,298,018	)		(9,934,366	)
DISTRIBUTIONS:
Net investment income
Investment Class		–			–			–			–			–			–
Net realized gain on investments
Investment Class		–			(715,106	)		–			(717,699	)		–			(4,067,154	)
Total distributions		–			(715,106	)		–			(717,699	)		–			(4,067,154	)
CAPITAL SHARE TRANSACTIONS:
Value of shares sold
Investment Class		29,459,882			33,607,211			106,460,258			197,807,106			4,695,748			23,441,296
Distributions reinvested
Investment Class		–			676,672			–			663,438			–			3,906,053
Value of shares redeemed
Investment Class		(8,185,207	)		(3,228,194	)		(94,678,010	)		(30,188,581	)		(9,527,742	)		(78,478,320	)
Shareholder redemption fees
Investment Class		31,724			13,739			254,297			146,998			17,677			326,226
Net increase (decrease) in net assets from capital share transactions		21,306,399			31,069,428			12,036,545			168,428,961			(4,814,317	)		(50,804,745	)
NET INCREASE (DECREASE) IN NET ASSETS		22,817,683			34,678,557			(1,833,540	)		191,575,206			(8,112,335	)		(64,806,265	)
NET ASSETS:
Beginning of period		38,712,870			4,034,313			211,980,600			20,405,394			37,601,619			102,407,884
End of period	$	61,530,553		$	38,712,870		$	210,147,060		$	211,980,600		$	29,489,284		$	37,601,619
UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) AT END OF PERIOD	$	(130,022	)	$	–		$	(858,856	)	$	(246,390	)	$	(260,598	)	$	–

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  65

STATEMENTS OF CHANGES IN NET ASSETS
		Royce 100 Fund						Royce Discovery Fund						Royce Financial Services Fund
		Six months ended 6/30/05 (unaudited)			Year ended 12/31/04			Six months ended 6/30/05 (unaudited)			Year ended 12/31/04			Six months ended 6/30/05 (unaudited)			Year ended 12/31/04
INVESTMENT OPERATIONS:
Net investment income (loss)	$	(25,073	)	$	(16,269	)	$	(8,397	)	$	(21,965	)	$	6,776		$	(1,649	)
Net realized gain (loss) on investments		400,559			360,271			229,655			58,266			13,504			22,079
Net change in unrealized appreciation (depreciation) on investments		(277,808	)		1,024,000			(276,299	)		262,572			(39,296	)		150,120
Net increase (decrease) in net assets from investment operations		97,678			1,368,002			(55,041	)		298,873			(19,016	)		170,550
DISTRIBUTIONS:
Net investment income
Investment Class		–			–			–			–			–			–
Net realized gain on investments
Investment Class		–			(210,006	)		–			(31,588	)		–			(20,302	)
Total distributions		–			(210,006	)		–			(31,588	)		–			(20,302	)
CAPITAL SHARE TRANSACTIONS:
Value of shares sold
Investment Class		3,066,442			5,182,730			637,169			2,177,444			130,898			1,249,398
Distributions reinvested
Investment Class		–			193,823			–			31,342			–			20,222
Value of shares redeemed
Investment Class		(705,601	)		(288,958	)		(602,086	)		(618,592	)		(46,795	)		(2,032	)
Shareholder redemption fees
Investment Class		1,020			1,089			1,967			335			378			–
Net increase (decrease) in net assets from capital share transactions		2,361,861			5,088,684			37,050			1,590,529			84,481			1,267,588
NET INCREASE (DECREASE) IN NET ASSETS		2,459,539			6,246,680			(17,991	)		1,857,814			65,465			1,417,836
NET ASSETS:
Beginning of period		8,748,325			2,501,645			3,217,123			1,359,309			1,417,836			–
End of period	$	11,207,864		$	8,748,325		$	3,199,132		$	3,217,123		$	1,483,301		$	1,417,836
UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) AT END OF PERIOD	$	(25,073	)	$	–		$	(12,667	)	$	(4,270	)	$	6,776		$	–

66  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

	Royce Dividend Value Fund
	Six months ended 6/30/05 (unaudited)			Period ended 12/31/04*
INVESTMENT OPERATIONS:
Net investment income (loss)	$	13,024		$	(1,340	)
Net realized gain (loss) on investments		4,061			1,941
Net change in unrealized appreciation (depreciation) on investments		(21,579	)		164,737
Net increase (decrease) in net assets from investment operations		(4,494	)		165,338
DISTRIBUTIONS:
Net investment income
Investment Class		(10,967	)		–
Net realized gain on investments
Investment Class		–			–
Total distributions		(10,967	)		–
CAPITAL SHARE TRANSACTIONS:
Value of shares sold
Investment Class		1,504,793			1,506,622
Distributions reinvested
Investment Class		10,918			–
Value of shares redeemed
Investment Class		(91,928	)		(21,541	)
Shareholder redemption fees
Investment Class		2			–
Net increase (decrease) in net assets from capital share transactions		1,423,785			1,485,081
NET INCREASE (DECREASE) IN NET ASSETS		1,408,324			1,650,419
NET ASSETS:
Beginning of period		1,650,419			–
End of period	$	3,058,743		$	1,650,419
UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) AT END OF PERIOD	$	2,057		$	–
* From May 3, 2004 (commencement of operations) to December 31, 2004.

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  67

STATEMENTS OF OPERATIONS												SIX MONTHS ENDED JUNE 30, 2005 (Unaudited)
	Pennsylvania			Royce			Royce			Royce			Royce			Royce			Royce			Royce
	Mutual			Micro-Cap			Premier			Low-Priced			Total Return			TrustShares			Opportunity			Special Equity
	Fund			Fund			Fund			Stock Fund			Fund			Fund			Fund			Fund
INVESTMENT INCOME:
Income:
Dividends
Non-Affiliates	$	7,375,015		$	1,394,697		$	7,335,908		$	9,600,575		$	37,425,822		$	178,456		$	4,797,186			$	4,932,456
Affiliated Companies		196,138			–			3,380,166			3,009,187			1,486,119			–			–				1,659,205
Interest		2,902,426			865,852			5,889,579			4,508,875			10,697,398			56,599			1,709,215				1,255,677
Securities lending		151,055			98,697			64,584			852,430			74,603			–			290,116				30,453
Total income		10,624,634			2,359,246			16,670,237			17,971,067			49,683,942			235,055			6,796,517				7,877,791
Expenses:
Investment advisory fees		7,908,538			3,972,368			15,623,591			23,702,044			22,780,007			258,743			9,607,449				4,788,629
Distribution fees – Investment Class		–			–			–			5,290,061			–			62,263			–				–
Distribution fees – Consultant Class		3,796,369			794,194			155,107						2,586,467			9,690							96,666
Distribution fees – Financial Intermediary Class					1,321			101,981						341,060						269,050				16,069
Shareholder servicing		584,366			228,213			1,272,771			2,239,585			2,152,606			29,174			679,777				282,160
Shareholder reports		472,374			128,466			615,276			850,112			850,000			23,768			273,073				143,924
Custody		157,933			69,258			203,210			265,100			391,192			28,873			226,715				89,869
Administrative and office facilities		87,646			28,360			136,240			197,375			201,071			2,331			88,502				44,662
Registration		48,742			21,922			67,565			48,782			76,592			14,107			40,882				28,786
Trustees’ fees		30,971			9,365			47,881			65,644			70,819			784			23,549				14,757
Audit		17,500			10,000			20,000			21,500			24,000			5,000			17,500				15,000
Legal		13,384			4,313			20,806			30,008			30,704			355			13,458				6,787
Other expenses		39,735			18,481			56,411			87,285			83,499			5,267			44,289				25,160
Total expenses		13,157,558			5,286,261			18,320,839			32,797,496			29,588,017			440,355			11,284,244				5,552,469
Fees waived by investment adviser and distributor		(50,168	)		–			–			(1,298,346	)		–			(37,358	)		–				–
Expenses reimbursed by investment advisor –
Consultant Class		–			–			–						–			(16,203	)						–
Institutional Class					(5,598	)		(238	)					–						(11,614	)			–
Financial Intermediary Class					(7,377	)		(40,051	)					(105,214	)					(136,729	)			(7,545	)
W Class								–						–
Net expenses		13,107,390			5,273,286			18,280,550			31,499,150			29,482,803			386,794			11,135,901				5,544,924
Net investment income (loss)		(2,482,756	)		(2,914,040	)		(1,610,313	)		(13,528,083	)		20,201,139			(151,739	)		(4,339,384	)			2,332,867
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on investments
Non-Affiliates		57,615,196			40,537,367			130,586,468			174,502,081			84,264,397			4,105,305			155,724,418				12,712,836
Affiliated Companies		7,283,751			(180,238	)		1,496,484			20,881,208			8,862,740			–			(4,363,078	)			–
Net change in unrealized appreciation
(depreciation) on investments		(6,473,810	)		(60,774,934	)		(134,266,124	)		(385,967,088	)		(36,110,823	)		(6,691,209	)		(221,316,169	)			(41,224,470	)
Net realized and unrealized gain (loss) on investments		58,425,137			(20,417,805	)		(2,183,172	)		(190,583,799	)		57,016,314			(2,585,904	)		(69,954,829	)			(28,511,634	)
NET INCREASE (DECREASE) IN NET ASSETS FROM INVESTMENT OPERATIONS	$	55,942,381		$	(23,331,845	)	$	(3,793,485	)	$	(204,111,882	)	$	77,217,453		$	(2,737,643	)	$	(74,294,213	)		$	(26,178,767	)

68  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005 THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.

STATEMENTS OF OPERATIONS												SIX MONTHS ENDED JUNE 30, 2005 (Unaudited)
	Royce Select Fund			Royce Value Fund			Royce Value Plus Fund			Royce Technology Value Fund			Royce 100 Fund			Royce Discovery Fund			Royce Financial Services Fund			Royce Dividend Value Fund
INVESTMENT INCOME:
Income:
Dividends
Non-Affiliates	$	152,798		$	132,079		$	432,055		$	13,500		$	37,528		$	11,433		$	15,815		$	20,267
Interest		21,984			76,368			264,573			23,439			12,740			3,528			1,624			7,890
Total income		174,782			208,447			696,628			36,939			50,268			14,961			17,439			28,157
Expenses:
Investment advisory fees		–			250,696			1,113,644			224,274			50,565			15,676			7,156			10,156
Distribution fees – Investment Class		–			62,674			278,411			37,379			12,641			3,919			1,789			2,539
Shareholder servicing		–			30,019			75,407			20,827			21,355			20,552			5,104			5,154
Shareholder reports		–			10,535			41,034			4,014			3,497			1,731			974			1,724
Custody		–			21,390			34,852			13,459			9,821			7,041			3,742			4,433
Administrative and office facilities		–			1,739			8,839			1,709			391			136			61			71
Registration		–			15,248			21,362			9,270			6,758			5,887			3,982			3,574
Trustees’ fees		–			712			3,382			466			148			48			7			7
Audit		–			3,750			4,000			3,750			3,750			3,750			3,750			3,750
Legal		–			268			1,361			256			60			21			9			11
Other expenses		–			4,112			5,213			5,493			936			962			1,234			812
Total expenses		–			401,143			1,587,505			320,897			109,922			59,723			27,808			32,231
Fees waived by investment advisor and distributor					(62,674	)		(278,411	)		(23,360	)		(34,581	)		(19,595	)		(8,945	)		(12,695	)
Expenses reimbursed by investment advisor –
Investment Class		–			–			–			–			–			(16,770	)		(8,200	)		(4,403	)
Net expenses		–			338,469			1,309,094			297,537			75,341			23,358			10,663			15,133
Net investment income (loss)		174,782			(130,022	)		(612,466	)		(260,598	)		(25,073	)		(8,397	)		6,776			13,024
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on investments
Non-Affiliates		2,342,218			1,058,846			4,501,180			(703,309	)		400,559			229,655			13,504			4,061
Net change in unrealized appreciation
(depreciation) on investments		(3,275,807	)		582,460			(17,758,799	)		(2,334,111	)		(277,808	)		(276,299	)		(39,296	)		(21,579	)
Net realized and unrealized gain (loss) on investments		(933,589	)		1,641,306			(13,257,619	)		(3,037,420	)		122,751			(46,644	)		(25,792	)		(17,518	)
NET INCREASE (DECREASE) IN NET ASSETS FROM INVESTMENT OPERATIONS	$	(758,807	)	$	1,511,284		$	(13,870,085	)	$	(3,298,018	)	$	97,678		$	(55,041	)	$	(19,016	)	$	(4,494	)

THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  69

FINANCIAL HIGHLIGHTS
This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.
	Net		Net			Net Realized						Distributions			Distributions															Ratio of Expenses to Average Net Assets						Ratio of Net Investment
	Asset Value, Beginning of Period		Investment Income (Loss)			and Unrealized Gain (Loss) on Investments			Total from Investment Operations			from Net Investment Income			from Net Realized Gain on Investments			Total Distributions			Shareholder Redemption Fees		Net Asset Value, End of Period		Total Return			Net Assets, End of Period (in thousands)		Net of Fee Waivers			Prior to Fee Waivers			Income (Loss) to Average Net Assets			Portfolio Turnover Rate
PENNSYLVANIA MUTUAL FUND – INVESTMENT CLASS
†2005 (c)	$	10.14	$	0.01		$	0.25		$	0.26		$	–		$	–		$	–		$	–	$	10.40		2.6	%**	$	1,487,087		0.90	%*		0.90	%*		0.12	%*		12	%
2004 (c)		8.88		(0.02	)		1.81			1.79			–			(0.53	)		(0.53	)		–		10.14		20.2	%		1,243,059		0.89	%		0.89	%		(0.20	)%		32	%
2003 (c)		6.59		(0.01	)		2.66			2.65			–			(0.36	)		(0.36	)		–		8.88		40.3	%		839,604		0.93	%		0.93	%		(0.17	)%		30	%
2002 (c)		7.39		(0.01	)		(0.67	)		(0.68	)		–			(0.12	)		(0.12	)		–		6.59		(9.2	)%		462,152		0.94	%		0.94	%		(0.13	)%		33	%
2001		6.88		0.02			1.22			1.24			(0.03	)		(0.70	)		(0.73	)		–		7.39		18.4	%		445,171		0.99	%		0.99	%		0.24	%		39	%
2000		7.28		0.05			1.19			1.24			(0.01	)		(1.63	)		(1.64	)		–		6.88		18.4	%		369,346		1.03	%		1.03	%		0.63	%		45	%
PENNSYLVANIA MUTUAL FUND – CONSULTANT CLASS
†2005 (c)	$	9.77	$	(0.04	)	$	0.24		$	0.20		$	–		$	–		$	–		$	–	$	9.97		2.1	%**	$	805,915		1.88	%*		1.89	%*		(0.86	)%*		12	%
2004 (c)		8.65		(0.11	)		1.76			1.65			–			(0.53	)		(0.53	)		–		9.77		19.1	%		753,388		1.89	%		1.89	%		(1.20	)%		32	%
2003 (c)		6.50		(0.09	)		2.60			2.51			–			(0.36	)		(0.36	)		–		8.65		38.7	%		484,439		1.94	%		1.94	%		(1.19	)%		30	%
2002 (c)		7.36		(0.08	)		(0.66	)		(0.74	)		–			(0.12	)		(0.12	)		–		6.50		(10.1	)%		266,061		1.97	%		1.97	%		(1.16	)%		33	%
2001		6.87		(0.04	)		1.22			1.18			–			(0.69	)		(0.69	)		–		7.36		17.5	%		137,787		1.73	%		1.97	%		(0.50	)%		39	%
2000		7.28		(0.01	)		1.19			1.18			–			(1.59	)		(1.59	)		–		6.87		17.5	%		128,247		1.73	%		2.00	%		(0.07	)%		45	%
ROYCE MICRO-CAP FUND – INVESTMENT CLASS
†2005 (c)	$	15.71	$	(0.05	)	$	(0.47	)	$	(0.52	)	$	–		$	–		$	–		$	–	$	15.19		(3.3	)%**	$	436,851		1.47	%*		1.47	%*		(0.69	)%*		16	%
2004 (c)		14.93		(0.15	)		2.47			2.32			–			(1.54	)		(1.54	)		–		15.71		15.8	%		473,248		1.47	%		1.56	%		(0.94	)%		44	%
2003 (c)		10.16		(0.13	)		5.47			5.34			–			(0.57	)		(0.57	)		–		14.93		52.6	%		431,808		1.48	%		1.67	%		(1.09	)%		44	%
2002 (c)		11.85		(0.12	)		(1.48	)		(1.60	)		–			(0.10	)		(0.10	)		0.01		10.16		(13.4	)%		262,981		1.49	%		1.73	%		(1.05	)%		31	%
2001		9.78		(0.07	)		2.32			2.25			–			(0.19	)		(0.19	)		0.01		11.85		23.1	%		203,233		1.49	%		1.75	%		(0.69	)%		30	%
2000		9.50		(0.02	)		1.58			1.56			–			(1.28	)		(1.28	)		–		9.78		16.7	%		140,148		1.49	%		1.82	%		(0.22	)%		71	%
ROYCE MICRO-CAP FUND – CONSULTANT CLASS
†2005(c)	$	14.92	$	(0.12	)	$	(0.45	)	$	(0.57	)	$	–		$	–		$	–		$	–	$	14.35		(3.8	)%**	$	155,672		2.47	%*		2.47	%*		(1.70	)%*		16	%
2004 (c)		14.39		(0.29	)		2.36			2.07			–			(1.54	)		(1.54	)		–		14.92		14.6	%		169,813		2.47	%		2.56	%		(1.94	)%		44	%
2003 (c)		9.91		(0.25	)		5.30			5.05			–			(0.57	)		(0.57	)		–		14.39		51.0	%		144,451		2.49	%		2.74	%		(2.10	)%		44	%
2002 (c)		11.68		(0.22	)		(1.45	)		(1.67	)		–			(0.10	)		(0.10	)		–		9.91		(14.3	)%		68,963		2.49	%		2.78	%		(2.06	)%		31	%
2001 (c)		9.71		(0.18	)		2.34			2.16			–			(0.19	)		(0.19	)		–		11.68		22.3	%		6,598		2.49	%		3.50	%		(1.71	)%		30	%
2000		9.45		(0.11	)		1.55			1.44			–			(1.18	)		(1.18	)		–		9.71		15.5	%		1,610		2.49	%		3.80	%		(1.27	)%		71	%
ROYCE MICRO-CAP FUND – INSTITUTIONAL CLASS(a)
†2005 (c)	$	15.75	$	(0.04	)	$	(0.48	)	$	(0.52	)	$	–		$	–		$	–		$	–	$	15.23		(3.3	)%**	$	5,742		1.35	%*		1.55	%*		(0.58	)%*		16	%
2004 (c)		14.94		(0.13	)		2.48			2.35			–			(1.54	)		(1.54	)		–		15.75		16.0	%		5,936		1.35	%		1.60	%		(0.82	)%		44	%
2003 (c)		14.56		(0.03	)		0.98			0.95			–			(0.57	)		(0.57	)		–		14.94		6.6	%**		10,125		1.29	%*		1.77	%*		(0.93	)%*		44	%
ROYCE MICRO-CAP FUND – FINANCIAL INTERMEDIARY CLASS(b)
†2005 (c)	$	15.68	$	(0.05	)	$	(0.48	)	$	(0.53	)	$	–		$	–		$	–		$	–	$	15.15		(3.4	)%**	$	1,022		1.49	%*		2.89	%*		(0.72)	%*		16	%
2004 (c)		14.91		(0.16	)		2.47			2.31			–			(1.54	)		(1.54	)		–		15.68		15.7	%		1,152		1.49	%		3.07	%		(1.06	)%		44	%
2003 (c)		10.16		(0.15	)		5.47			5.32			–			(0.57	)		(0.57	)		–		14.91		52.4	%		202		1.49	%		17.16	%		(1.11	)%		44	%
2002 (c)		10.27		(0.04	)		0.03			(0.01	)		–			(0.10	)		(0.10	)		–		10.16		(0.1)	%**		7		1.49	%*		17.46	%*		(1.20	)%*		31	%

(a)	The Class commenced operations on October 14, 2003.
(b)	The Class commenced operations on August 20, 2002.
(c)	Per share amounts have been determined on the basis of the weighted average number of shares outstanding during the period.
*	Annualized.
**	Not annualized.
†	Six months ended June 30, 2005 (unaudited).

70  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005

FINANCIAL HIGHLIGHTS
This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.
																														Ratio of Expenses						Ratio of Net
	Net		Net			Net Realized						Distributions			Distributions															to Average Net Assets						Investment
	Asset Value,		Investment			and Unrealized			Total from			from Net			from Net						Shareholder		Net Asset					Net Assets,		Net of			Prior			Income (Loss)			Portfolio
	Beginning		Income			Gain (Loss) on			Investment			Investment			Realized Gain			Total			Redemption		Value, End		Total			End of Period		Fee			to Fee			to Average			Turnover
	of Period		(Loss)			Investments			Operations			Income			on Investments			Distributions			Fees		of Period		Return			(in thousands)		Waivers			Waivers			Net Assets			Rate
ROYCE PREMIER FUND – INVESTMENT CLASS
†2005(e)	$	15.12	$	(0.01	)	$	(0.02	)	$	(0.03	)	$	–		$	–		$	–		$	–	$	15.09		(0.2	)%**	$	2,789,778		1.14	%*		1.14	%*		(0.10	)%*		12	%
2004(e)		12.90		(0.06	)		2.99			2.93			–			(0.71	)		(0.71	)		–		15.12		22.8	%		2,975,348		1.14	%		1.14	%		(0.43	)%		24	%
2003(e)		9.39		(0.03	)		3.67			3.64			–			(0.13	)		(0.13	)		–		12.90		38.7	%		1,713,001		1.16	%		1.16	%		(0.29	)%		26	%
2002(e)		10.54		(0.04	)		(0.77	)		(0.81	)		–			(0.34	)		(0.34	)		–		9.39		(7.8	)%		848,341		1.17	%		1.17	%		(0.40	)%		33	%
2001		9.83		–			0.94			0.94			–			(0.23	)		(0.23	)		–		10.54		9.6	%		797,248		1.19	%		1.19	%		(0.04	)%		41	%
2000		9.56		0.03			1.54			1.57			(0.03	)		(1.27	)		(1.30	)		–		9.83		17.1	%		675,653		1.20	%		1.20	%		0.34	%		40	%
ROYCE PREMIER FUND – CONSULTANT CLASS(a)
†2005(e)	$	14.80	$	(0.08	)	$	(0.02	)	$	(0.10	)	$	–		$	–		$	–		$	–	$	14.70		(0.7	)%**	$	35,645		2.20	%*		2.20	%*		(1.14	)%*		12	%
2004(e)		12.80		(0.22	)		2.93			2.71			–			(0.71	)		(0.71	)		–		14.80		21.3	%		26,805		2.35	%		2.35	%		(1.59	)%		24	%
2003(e)		10.52		(0.08	)		2.49			2.41			–			(0.13	)		(0.13	)		–		12.80		22.9	%**		5,401		2.49	%*		4.25	%*		(1.22	)%*		26	%
ROYCE PREMIER FUND – INSTITUTIONAL CLASS(b)
†2005(e)	$	15.15	$	0.00		$	(0.03	)	$	(0.03	)	$	–		$	–		$	–		$	–	$	15.12		(0.2	)%**	$	175,676		1.03	%*		1.03	%*		0.04	%*		12	%
2004(e)		12.91		(0.04	)		2.99			2.95			–			(0.71	)		(0.71	)		–		15.15		23.0	%		104,497		1.04	%		1.06	%		(0.30	)%		24	%
2003(e)		9.39		(0.00	)		3.65			3.65			–			(0.13	)		(0.13	)		–		12.91		38.8	%		24,106		1.04	%		1.14	%		(0.03	)%		26	%
2002(e)		9.64		(0.01	)		0.10			0.09			–			(0.34	)		(0.34	)		–		9.39		0.9	%**		4,490		1.04	%*		1.58	%*		(0.28	)%*		33	%
ROYCE PREMIER FUND – FINANCIAL INTERMEDIARY CLASS(c)
†2005(e)	$	15.07	$	(0.02	)	$	(0.02	)	$	(0.04	)	$	–		$	–		$	–		$	–	$	15.03		(0.3	)%**	$	95,672		1.29	%*		1.39	%*		(0.23	)%*		12	%
2004(e)		12.89		(0.08	)		2.97			2.89			–			(0.71	)		(0.71	)		–		15.07		22.5	%		69,759		1.29	%		1.39	%		(0.57	)%		24	%
2003(e)		9.39		(0.04	)		3.67			3.63			–			(0.13	)		(0.13	)		–		12.89		38.6	%		32,307		1.29	%		1.42	%		(0.33	)%		26	%
2002(e)		9.48		(0.02	)		0.27			0.25			–			(0.34	)		(0.34	)		–		9.39		2.6	%**		7,826		1.29	%*		4.69	%*		(0.62	)%*		33	%
ROYCE PREMIER FUND – W CLASS (d)
†2005(e)	$	14.37	$	0.01		$	0.71		$	0.72		$	–		$	–		$	–		$	–	$	15.09		5.0	%**	$	245,278		0.99	%*		0.99	%*		0.38	%*		12	%
ROYCE LOW-PRICED STOCK FUND
†2005(e)	$	15.33	$	(0.04	)	$	(0.58	)	$	(0.62	)	$	–		$	–		$	–		$	–	$	14.71		(4.0	)%**	$	3,964,633		1.49	%*		1.55	%*		(0.64	)%*		11	%
2004(e)		13.98		(0.14	)		2.04			1.90			–			(0.55	)		(0.55	)		–		15.33		13.6	%		4,769,417		1.49	%		1.71	%		(1.00	)%		26	%
2003(e)		9.75		(0.07	)		4.36			4.29			–			(0.06	)		(0.06	)		–		13.98		44.0	%		3,046,100		1.49	%		1.94	%		(0.70	)%		42	%
2002(e)		11.67		(0.08	)		(1.83	)		(1.91	)		–			(0.02	)		(0.02	)		0.01		9.75		(16.3	)%		1,787,172		1.49	%		1.97	%		(0.74	)%		29	%
2001(e)		9.35		(0.06	)		2.39			2.33			–			(0.02	)		(0.02	)		0.01		11.67		25.1	%		1,024,693		1.49	%		2.02	%		(0.54	)%		31	%
2000		8.16		–			1.93			1.93			–			(0.74	)		(0.74	)		–		9.35		24.0	%		130,855		1.49	%		2.08	%		0.04	%		56	%

(a)	The Class commenced operations on June 2, 2003.
(b)	The Class commenced operations on September 17, 2002.
(c)	The Class commenced operations on September 3, 2002.
(d)	The Class commenced operations on May 19, 2005.
(e)	Per share amounts have been determined on the basis of the weighted average number of shares outstanding during the period.
*	Annualized.
**	Not annualized.
†	Six months ended June 30, 2005 (unaudited).

THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  71

FINANCIAL HIGHLIGHTS
This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.
																														Ratio of Expenses					Ratio of Net
	Net		Net			Net Realized						Distributions			Distributions															to Average Net Assets					Investment
	Asset Value,		Investment			and Unrealized			Total from			from Net			from Net						Shareholder		Net Asset					Net Assets,		Net of		Prior			Income (Loss)			Portfolio
	Beginning		Income			Gain (Loss) on			Investment			Investment			Realized Gain			Total			Redemption		Value, End		Total			End of Period		Fee		to Fee			to Average			Turnover
	of Period		(Loss)			Investments			Operations			Income			on Investments			Distributions			Fees		of Period		Return			(in thousands)		Waivers		Waivers			Net Assets			Rate
ROYCE TOTAL RETURN FUND – INVESTMENT CLASS
†2005(e)	$	12.26	$	0.06		$	0.12		$	0.18		$	(0.05	)	$	–		$	(0.05	)	$	–	$	12.39		1.5	%**	$	3,967,100	1.14	%*		1.14	%*		0.96	%*		11	%
2004(e)		10.69		0.11			1.75			1.86			(0.12	)		(0.17	)		(0.29	)		–		12.26		17.5	%		3,738,851	1.15	%		1.15	%		1.08	%		22	%
2003(e)		8.37		0.11			2.39			2.50			(0.10	)		(0.08	)		(0.18	)		–		10.69		30.0	%		2,289,013	1.18	%		1.18	%		1.27	%		20	%
2002(e)		8.59		0.08			(0.21	)		(0.13	)		(0.08	)		(0.01	)		(0.09	)		–		8.37		(1.6	)%		986,455	1.20	%		1.20	%		1.01	%		22	%
2001		7.77		0.09			1.05			1.14			(0.11	)		(0.21	)		(0.32	)		–		8.59		14.8	%		509,250	1.24	%		1.24	%		1.14	%		24	%
2000		7.15		0.16			1.18			1.34			(0.15	)		(0.57	)		(0.72	)		–		7.77		19.4	%		281,562	1.25	%		1.28	%		2.08	%		24	%
ROYCE TOTAL RETURN FUND – CONSULTANT CLASS(a)
†2005(e)	$	12.24	$	(0.00	)	$	0.13		$	0.13		$	–		$	–		$	–		$	–	$	12.37		1.1	%**	$	556,460	2.11	%*		2.11	%*		(0.01	)%*		11	%
2004(e)		10.68		0.01			1.73			1.74			(0.01	)		(0.17	)		(0.18	)		–		12.24		16.4	%		501,635	2.13	%		2.13	%		0.10	%		22	%
2003(e)		8.37		0.02			2.37			2.39			–			(0.08	)		(0.08	)		–		10.68		28.6	%		309,136	2.19	%		2.19	%		0.26	%		20	%
2002(e)		8.64		–			(0.24	)		(0.24	)		(0.02	)		(0.01	)		(0.03	)		–		8.37		(2.7	)%		120,737	2.20	%		2.25	%		0.15	%		22	%
2001		8.05		–			0.80			0.80			–			(0.21	)		(0.21	)		–		8.64		10.0	%**		3,429	2.20	%*		3.38	%*		(0.60	)%*		24	%
ROYCE TOTAL RETURN FUND – INSTITUTIONAL CLASS(b)
†2005(e)	$	12.30	$	0.07		$	0.12		$	0.19		$	(0.06	)	$	–		$	(0.06	)	$	–	$	12.43		1.6	%**	$	146,498	1.01	%*		1.01	%*		1.10	%*		11	%
2004(e)		10.71		0.13			1.76			1.89			(0.13	)		(0.17	)		(0.30	)		–		12.30		17.8	%		124,286	1.04	%		1.04	%		1.20	%		22	%
2003(e)		7.88		0.10			2.90			3.00			(0.09	)		(0.08	)		(0.17	)		–		10.71		38.2	%**		67,912	1.04	%*		1.07	%*		1.54	%*		20	%
ROYCE TOTAL RETURN FUND – FINANCIAL INTERMEDIARY CLASS(c)
†2005(e)	$	12.12	$	0.05		$	0.13		$	0.18		$	(0.04	)	$	–		$	(0.04	)	$	–	$	12.26		1.5	%**	$	297,207	1.29	%*		1.37	%*		0.81	%*		11	%
2004(e)		10.57		0.10			1.72			1.82			(0.10	)		(0.17	)		(0.27	)		–		12.12		17.4	%		261,212	1.29	%		1.38	%		0.95	%		22	%
2003(e)		8.28		0.11			2.34			2.45			(0.08	)		(0.08	)		(0.16	)		–		10.57		29.7	%		131,813	1.28	%		1.45	%		1.28	%		20	%
2002(e)		8.59		0.07			(0.29	)		(0.22	)		(0.08	)		(0.01	)		(0.09	)		–		8.28		(2.7	)%**		12,302	1.28	%*		1.54	%*		0.97	%*		22	%
ROYCE TOTAL RETURN FUND – W CLASS(d)
†2005(e)	$	11.97	$	0.02		$	0.44		$	0.46		$	(0.02	)	$	–		$	(0.02	)	$	–	$	12.41		3.9	%**	$	102,214	1.01	%*		1.01	%*		1.30	%*		11	%
ROYCE TRUSTSHARES FUND – INVESTMENT CLASS
†2005(e)	$	13.00	$	(0.03	)	$	(0.62	)	$	(0.65	)	$	–		$	–		$	–		$	–	$	12.35		(5.0	)%**	$	50,905	1.46	%*		1.61	%*		(0.55	)%*		57	%
2004(e)		12.19		(0.12	)		2.57			2.45			–			(1.64	)		(1.64	)		–		13.00		20.4	%		52,891	1.49	%		1.55	%		(0.95	)%		86	%
2003(e)		9.03		(0.08	)		3.51			3.43			–			(0.27	)		(0.27	)		–		12.19		38.1	%		34,143	1.49	%		1.63	%		(0.81	)%		25	%
2002(e)		11.47		(0.09	)		(2.07	)		(2.16	)		–			(0.28	)		(0.28	)		–		9.03		(18.9	)%		23,312	1.49	%		1.63	%		(0.85	)%		66	%
2001		9.99		(0.08	)		2.12			2.04			–			(0.56	)		(0.56	)		–		11.47		20.5	%		26,145	1.49	%		1.64	%		(0.81	)%		53	%
2000		10.10		(0.05	)		1.19			1.14			–			(1.25	)		(1.25	)		–		9.99		11.7	%		19,452	1.49	%		1.78	%		(0.59	)%		90	%

(a)	The Class commenced operations on October 16, 2001.
(b)	The Class commenced operations on March 4, 2003.
(c)	The Class commenced operations on January 3, 2002.
(d)	The Class commenced operations on May 19, 2005.
(e)	Per share amounts have been determined on the basis of the weighted average number of shares outstanding during the period.
*	Annualized.
**	Not annualized.
†	Six months ended June 30, 2005 (unaudited).

72  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005

FINANCIAL HIGHLIGHTS

This table is presented to show selected data for a share outstanding throughout each period and to assist shareholders in evaluating a Fund’s performance for the periods presented.
	Net		Net			Net Realized						Distributions		Distributions															Ratio of Expenses to Average Net Assets						Ratio of Net Investment
	Asset Value, Beginning of Period		Investment Income (Loss)			and Unrealized Gain (Loss) on Investments			Total from Investment Operations			from Net Investment Income		from Net Realized Gain on Investments			Total Distributions			Shareholder Redemption   Fees		Net Asset Value, End of Period		Total Return			Net Assets, End of Period (in thousands)		Net of Fee Waivers			Prior to Fee Waivers			Income (Loss) to Average Net Assets			Portfolio Turnover Rate
ROYCE TRUSTSHARES FUND – CONSULTANT CLASS (a)
† 2005 (d)	$	12.03	$	(0.09	)	$	(0.57	)	$	(0.66	)	$	–	$	–		$	–		$	–	$	11.37		(5.5	)% **	$	2,001		2.49	% *		4.16	% *		(1.58	)% *		57	%
2004 (d)		11.50		(0.23	)		2.40			2.17			–		(1.64	)		(1.64	)		–		12.03		19.1	%		1,885		2.49	%		5.21	%		(1.94	)%		86	%
2003 (d)		8.62		(0.18	)		3.33			3.15			–		(0.27	)		(0.27	)		–		11.50		36.7	%		762		2.49	%		8.20	%		(1.81	)%		25	%
2002 (d)		11.08		(0.13	)		(2.05	)		(2.18	)		–		(0.28	)		(0.28	)		–		8.62		(19.8	)%		342		2.49	%		10.36	%		(1.97	)%		66	%
2001		10.83		–			0.25			0.25			–		–			–			–		11.08		2.3	% **		163		2.49	% *		50.08	% *		(1.92	)% *		53	%
ROYCE OPPORTUNITY FUND – INVESTMENT CLASS
† 2005 (d)	$	13.31	$	(0.03	)	$	(0.41	)	$	(0.44	)	$	–	$	–		$	–		$	–	$	12.87		(3.3	)% **	$	1,501,514		1.15	% *		1.15	% *		(0.45	)% *		22	%
2004 (d)		12.14		(0.07	)		2.17			2.10			–		(0.93	)		(0.93	)		–		13.31		17.5	%		1,677,215		1.14	%		1.14	%		(0.55	)%		47	%
2003 (d)		7.37		(0.06	)		5.41			5.35			–		(0.58	)		(0.58	)		–		12.14		72.9	%		1,311,815		1.15	%		1.15	%		(0.65	)%		55	%
2002 (d)		9.01		(0.04	)		(1.50	)		(1.54	)		–		(0.11	)		(0.11	)		0.01		7.37		(17.0	)%		635,296		1.17	%		1.17	%		(0.49	)%		46	%
2001		7.78		(0.01	)		1.35			1.34			–		(0.11	)		(0.11	)		–		9.01		17.3	%		577,103		1.19	%		1.19	%		(0.19	)%		44	%
2000		7.19		–			1.40			1.40			–		(0.81	)		(0.81	)		–		7.78		19.9	%		298,561		1.24	%		1.24	%		0.00	%		56	%
ROYCE OPPORTUNITY FUND – INSTITUTIONAL CLASS (b)
† 2005 (d)	$	13.34	$	(0.02	)	$	(0.41	)	$	(0.43	)	$	–	$	–		$	–		$	–	$	12.91		(3.2	)% **	$	171,393		1.04	% *		1.05	% *		(0.33	)% *		22	%
2004 (d)		12.16		(0.06	)		2.17			2.11			–		(0.93	)		(0.93	)		–		13.34		17.6	%		193,136		1.04	%		1.06	%		(0.44	)%		47	%
2003 (d)		7.38		(0.05	)		5.41			5.36			–		(0.58	)		(0.58	)		–		12.16		72.9	%		85,813		1.04	%		1.08	%		(0.54	)%		55	%
2002 (d)		9.01		(0.03	)		(1.49	)		(1.52	)		–		(0.11	)		(0.11	)		–		7.38		(16.9	)%		31,897		1.04	%		1.14	%		(0.32	)%		46	%
2001		8.71		–			0.30			0.30			–		–			–			–		9.01		3.4	% **		5,173		1.04	% *		1.92	% *		(0.11	)% *		44	%
ROYCE OPPORTUNITY FUND – FINANCIAL INTERMEDIARY CLASS (c)
† 2005 (d)	$	13.17	$	(0.04	)	$	(0.40	)	$	(0.44	)	$	–	$	–		$	–		$	–	$	12.73		(3.3)	% **	$	192,182		1.29	% *		1.41	% *		(0.58	)% *		22	%
2004 (d)		12.05		(0.09	)		2.14			2.05			–		(0.93	)		(0.93	)		–		13.17		17.2	%		230,068		1.29	%		1.43	%		(0.70	)%		47	%
2003 (d)		7.33		(0.08	)		5.38			5.30			–		(0.58	)		(0.58	)		–		12.05		72.6	%		90,243		1.29	%		1.45	%		(0.79	)%		55	%
2002 (d)		8.98		(0.06	)		(1.48	)		(1.54	)		–		(0.11	)		(0.11	)		–		7.33		(17.2	)%		19,979		1.29	%		1.50	%		(0.60	)%		46	%
2001		7.78		(0.04	)		1.35			1.31			–		(0.11	)		(0.11	)		–		8.98		16.9	%		13,399		1.42	%		1.57	%		(0.52	)%		44	%
2000		8.12		(0.01	)		0.47			0.46			–		(0.80	)		(0.80	)		–		7.78		6.0	% **		1,100		1.49	% *		2.24	% *		(0.30	)% *		56	%

(a)	The Class commenced operations on December 7, 2001.
(b)	The Class commenced operations on December 12, 2001.
(c)	The Class commenced operations on May 23, 2000.
(d)	Per share amounts have been determined on the basis of the weighted average number of shares outstanding during the period.
*	Annualized.
**	Not annualized.
†	Six months ended June 30, 2005 (unaudited).

THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  73

FINANCIAL HIGHLIGHTS

This table is presented to show selected data for a share outstanding throughout each period and to assist shareholders in evaluating a Fund’s performance for the periods presented.
	Net		Net			Net Realized						Distributions			Distributions															Ratio of Expenses to Average Net Assets						Ratio of Net Investment
	Asset Value,  Beginning of Period		Investment Income (Loss)			and Unrealized Gain (Loss) on Investments			Total from Investment Operations			from Net Investment Income			from Net Realized Gain on Investments			Total Distributions			Shareholder Redemption  Fees		Net Asset Value, End of Period		Total Return			Net Assets, End of Period (in thousands)		Net of Fee Waivers			Prior to Fee Waivers			Income (Loss) to Average Net Assets			Portfolio Turnover Rate
ROYCE SPECIAL EQUITY FUND – INVESTMENT CLASS
† 2005 (e)	$	19.61	$	0.05		$	(0.50	)	$	(0.45	)	$	–		$	–		$	–		$	–	$	19.16		(2.3	)% **	$	713,444		1.15	% *		1.15	% *		0.50	% *		14	%
2004 (e)		17.97		0.20			2.28			2.48			(0.18	)		(0.67	)		(0.85	)		0.01		19.61		13.9	%		856,537		1.15	%		1.15	%		1.02	%		17	%
2003 (e)		14.24		0.05			3.86			3.91			(0.05	)		(0.15	)		(0.20	)		0.02		17.97		27.6	%		721,334		1.19	%		1.19	%		0.35	%		22	%
2002 (e)		12.37		0.02			1.73			1.75			(0.03	)		–			(0.03	)		0.15		14.24		15.3	%		397,755		1.20	%		1.20	%		0.27	%		41	%
2001		9.55		0.11			2.71			2.82			(0.11	)		–			(0.11	)		0.11		12.37		30.8	%		6,072		1.49	%		1.76	%		0.87	%		124	%
2000		8.31		0.12			1.23			1.35			(0.11	)		–			(0.11	)		–		9.55		16.3	%		3,211		1.49	%		2.26	%		1.38	%		61	%
ROYCE SPECIAL EQUITY FUND – CONSULTANT CLASS (a)
† 2005 (e)	$	19.47	$	(0.06	)	$	(0.50	)	$	(0.56	)	$	–		$	–		$	–		$	–	$	18.91		(2.9	)% **	$	19,156		2.25	% *		2.25	% *		(0.61	)% *		14	%
2004 (e)		17.89		(0.02	)		2.28			2.26			(0.01	)		(0.67	)		(0.68	)		–		19.47		12.7	%		20,277		2.28	%		2.28	%		(0.09	)%		17	%
2003 (e)		15.06		(0.08	)		3.07			2.99			(0.01	)		(0.15	)		(0.16	)		–		17.89		19.9	% **		9,944		2.20	% *		3.21	% *		(0.81	)% *		22	%
ROYCE SPECIAL EQUITY FUND – INSTITUTIONAL CLASS (b)
† 2005 (e)	$	19.58	$	0.06		$	(0.50	)	$	(0.44	)	$	–		$	–		$	–		$	–	$	19.14		(2.3	)% **	$	163,222		1.06	% *		1.06	% *		0.59	% *		14	%
2004 (e)		17.95		0.10			2.40			2.50			(0.20	)		(0.67	)		(0.87	)		–		19.58		14.0	%		162,819		1.07	%		1.07	%		1.07	%		17	%
2003 (e)		15.78		0.01			2.37			2.38			(0.06	)		(0.15	)		(0.21	)		–		17.95		15.1	% **		13,439		1.10	% *		1.36	% *		0.24	% *		22	%
ROYCE SPECIAL EQUITY FUND – FINANCIAL INTERMEDIARY CLASS (c)
† 2005 (e)	$	19.56	$	0.03		$	(0.50	)	$	(0.47	)	$	–		$	–		$	–		$	–	$	19.09		(2.4	)% **	$	13,240		1.35	% *		1.47	% *		0.29	% *		14	%
2004 (e)		17.95		0.09			2.35			2.44			(0.16	)		(0.67	)		(0.83	)		–		19.56		13.7	%		12,743		1.35	%		1.55	%		0.74	%		17	%
2003 (e)		16.38		(0.02	)		1.80			1.78			(0.06	)		(0.15	)		(0.21	)		–		17.95		10.9	% **		5,387		1.35	% *		1.79	% *		(0.04	)% *		22	%
ROYCE SELECT FUND
† 2005 (e)	$	208.67	$	1.48		$	(7.34	)	$	(5.86	)	$	–		$	–		$	–		$	0.03	$	202.84		(2.8	)% **	$	23,236		0.00	% **		0.00	% **		0.74	% **		45	%
2004 (e)		198.08		(3.23	)		40.81			37.58			–			(27.12	)		(27.12	)		0.13		208.67		19.1	%		24,917		2.45	%		2.45	%		(1.54	)%		53	%
2003 (e)		146.01		(3.06	)		73.86			70.80			–			(18.79	)		(18.79	)		0.06		198.08		48.7	%		21,640		2.69	%		2.69	%		(1.74	)%		30	%
2002 (e)		176.97		(0.97	)		(27.11	)		(28.08	)		–			(3.06	)		(3.06	)		0.18		146.01		(15.8	)%		16,183		1.01	%		1.01	%		(0.60	)%		90	%
2001		147.35		(3.13	)		38.97			35.84			–			(6.26	)		(6.26	)		0.04		176.97		24.5	%		18,507		2.72	%		2.72	%		(2.13	)%		54	%
2000		141.04		(2.24	)		22.38			20.14			–			(13.83	)		(13.83	)		–		147.35		15.0	%		13,068		2.48	%		2.48	%		(1.71	)%		114	%
ROYCE VALUE FUND (d)
† 2005 (e)	$	8.39	$	(0.02	)	$	0.18		$	0.16		$	–		$	–		$	–		$	0.01	$	8.56		2.0	% **	$	61,531		1.35	% *		1.60	% *		(0.52	)% *		19	%
2004 (e)		6.56		(0.06	)		2.07			2.01			–			(0.19	)		(0.19	)		0.01		8.39		30.9	%		38,713		1.49	%		2.15	%		(0.77	)%		83	%
2003 (e)		4.35		(0.04	)		2.40			2.36			–			(0.15	)		(0.15	)		–		6.56		54.3	%		4,034		1.49	%		3.46	%		(0.73	)%		181	%
2002 (e)		5.89		(0.06	)		(1.32	)		(1.38	)		–			(0.16	)		(0.16	)		–		4.35		(23.5	)%		1,319		1.49	%		3.08	%		(1.26	)%		89	%
2001		5.00		(0.03	)		0.99			0.96			–			(0.07	)		(0.07	)		–		5.89		19.2	% **		1,491		1.49	% *		4.18	% *		(1.39	)% *		74	%

(a)	The Class commenced operations on June 2, 2003.
(b)	The Class commenced operations on July 25, 2003.
(c)	The Class commenced operations on October 2, 2003.
(d)	The Fund commenced operations on July 14, 2001.
(e)	Per share amounts have been determined on the basis of the weighted average number of shares outstanding during the period.
*	Annualized.
**	Not annualized.
†	Six months ended June 30, 2005 (unaudited).

74  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005

FINANCIAL HIGHLIGHTS

This table is presented to show selected data for a share outstanding throughout each period and to assist shareholders in evaluating a Fund’s performance for the periods presented.
	Net		Net			Net Realized						Distributions			Distributions															Ratio of Expenses to Average Net Assets						Ratio of Net Investment
	Asset Value,   Beginning of Period		Investment Income (Loss)			and Unrealized Gain (Loss) on Investments			Total from Investment Operations			from Net Investment Income			from Net Realized Gain on Investments			Total Distributions			Shareholder Redemption   Fees		Net Asset Value, End of Period		Total Return			Net Assets, End of Period (in thousands)		Net of Fee Waivers			Prior to Fee Waivers			Income (Loss) to Average Net Assets			Portfolio Turnover Rate
ROYCE VALUE PLUS FUND (a)
† 2005 (g)	$	10.94	$	(0.01	)	$	(0.59	)	$	(0.60	)	$	–		$	–		$	–		$	0.01	$	10.35		(5.4	)% **	$	210,147		1.18	% *		1.43	% *		(0.55	)% *		39	%
2004 (g)		8.57		(0.08	)		2.47			2.39			–			(0.04	)		(0.04	)		0.02		10.94		28.2	%		211,981		1.30	%		1.55	%		(0.84	)%		56	%
2003 (g)		4.97		(0.05	)		4.01			3.96			–			(0.36	)		(0.36	)		–		8.57		79.9	%		20,405		1.49	%		2.01	%		(0.91	)%		161	%
2002 (g)		5.97		(0.07	)		(0.81	)		(0.88	)		–			(0.12	)		(0.12	)		–		4.97		(14.7	)%		3,934		1.49	%		2.10	%		(1.29	)%		110	%
2001		5.00		(0.03	)		1.10			1.07			–			(0.10	)		(0.10	)		–		5.97		21.5	% **		2,217		1.49	% *		3.71	% *		(1.46	)% *		62	%
ROYCE TECHNOLOGY VALUE FUND (b)
† 2005 (g)	$	6.73	$	(0.05	)	$	(0.52	)	$	(0.57	)	$	–		$	–		$	–		$	–	$	6.16		(8.5	)% **	$	29,489		1.99	% *		2.15	% *		(1.74	)% *		42	%
2004 (g)		8.25		(0.15	)		(0.69	)		(0.84	)		–			(0.72	)		(0.72	)		0.04		6.73		(9.6	)%		37,602		1.99	%		2.13	%		(1.94	)%		107	%
2003 (g)		4.33		(0.11	)		4.01			3.90			–			(0.01	)		(0.01	)		0.03		8.25		90.7	%		102,408		1.99	%		2.11	%		(1.51	)%		64	%
2002 (g)		5.00		(0.17	)		(0.50	)		(0.67	)		–			–			–			–		4.33		(13.4	)%		4,786		1.99	%		2.73	%		(1.74	)%		45	%
ROYCE 100 FUND (c)
† 2005 (g)	$	6.85	$	(0.02	)	$	0.04		$	0.02		$	–		$	–		$	–		$	–	$	6.87		0.3	% **	$	11,208		1.49	% *		2.17	% *		(0.50	)% *		31	%
2004 (g)		5.53		(0.02	)		1.52			1.50			–			(0.18	)		(0.18	)		–		6.85		27.2	%		8,748		1.49	%		2.84	%		(0.34	)%		97	%
2003 (g)		5.00		(0.01	)		0.54			0.53			–			(0.00	)		(0.00	)		–		5.53		10.7	% **		2,502		1.49	% *		3.68	% *		(0.39	)% *		8	%
ROYCE DISCOVERY FUND (d)
† 2005 (g)	$	6.39	$	(0.01	)	$	(0.08	)	$	(0.09	)	$	–		$	–		$	–		$	–	$	6.30		(1.4	)% **	$	3,199		1.49	% *		3.81	% *		(0.54	)% *		57	%
2004 (g)		5.70		(0.05	)		0.81			0.76			–			(0.07	)		(0.07	)		–		6.39		13.4	%		3,217		1.49	%		4.12	%		(0.91	)%		111	%
2003 (g)		5.00		(0.01	)		0.71			0.70			–			–			–			–		5.70		14.0	% **		1,359		1.49	% *		8.69	% *		(1.05	)% *		1	%
ROYCE FINANCIAL SERVICES FUND (e)
† 2005 (g)	$	5.66	$	0.03		$	(0.10	)	$	(0.07	)	$	–		$	–		$	–		$	–	$	5.59		(1.2	)% **	$	1,483		1.49	% *		3.89	% *		0.95	% *		2	%
2004 (g)		5.00		(0.01	)		0.76			0.75			–			(0.09	)		(0.09	)		–		5.66		15.1	%		1,418		1.49	%		4.70	%		(0.16	)%		22	%
ROYCE DIVIDEND VALUE FUND (f)
† 2005 (g)	$	5.65	$	0.03		$	(0.10	)	$	(0.07	)	$	(0.02	)	$	–		$	(0.02	)	$	–	$	5.56		(1.2	)% **	$	3,059		1.49	% *		3.17	% *		1.28	% *		2	%
2004 (g)		5.00		(0.01	)		0.66			0.65			–			–			–			–		5.65		13.0	% **		1,650		1.49	% *		5.60	% *		(0.17	)% *		8	%

(a)	The Fund commenced operations on June 14, 2001.
(b)	The Fund commenced operations on December 31, 2001.
(c)	The Fund commenced operations on June 30, 2003.
(d)	The Fund commenced operations on October 3, 2003.
(e)	The Fund commenced operations on December 31, 2003.
(f)	The Fund commenced operations on May 3, 2004.
(g)	Per share amounts have been determined on the basis of the weighted average number of shares outstanding during the period.
*	Annualized.
**	Not annualized.
†	Six months ended June 30, 2005 (unaudited).

THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  75

NOTES TO FINANCIAL STATEMENTS (Unaudited)

Summary of Significant Accounting Policies:
      Pennsylvania Mutual Fund, Royce Micro-Cap Fund, Royce Premier Fund, Royce Low-Priced Stock Fund, Royce Total Return Fund, Royce TrustShares Fund, Royce Opportunity Fund, Royce Special Equity Fund, Royce Select Fund, Royce Value Fund, Royce Value Plus Fund, Royce Technology Value Fund, Royce 100 Fund, Royce Discovery Fund, Royce Financial Services Fund and Royce Dividend Value Fund (the “Fund” or “Funds”), are the sixteen series of The Royce Fund (the “Trust”), a diversified open-end management investment company organized as a Delaware business trust.
      Classes of shares have equal rights as to earnings and assets, except that each class may bear different fees and expenses for distribution, shareholder servicing, registration and shareholder reports, and different expense reimbursements. Investment income, realized and unrealized capital gains or losses on investments, and expenses other than those attributable to a specific class are allocated to each class of shares based on its relative net assets. The W Classes of Royce Premier Fund and Royce Total Return Fund commenced operations on May 19, 2005, with an initial transfer from each Fund’s Investment Class. This transfer is included on the Statement of Changes in Net Assets as “value of shares sold” for the W Class and “value of shares redeemed” for the Investment Class [$220,153,624 (15,320,364 shares) for Royce Premier Fund and $86,905,027 (7,260,236 shares) for Royce Total Return Fund].
      The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

Valuation of Investments:
      Securities are valued as of the close of trading on the New York Stock Exchange (generally 4:00 p.m. Eastern time) on the valuation date. Securities that trade on an exchange or Nasdaq are valued at their last reported sales price taken from the primary market in which each security trades or, if no sale is reported for such day, at their bid price. Other over-the-counter securities for which market quotations are readily available are valued at their bid price. Securities for which market quotations are not readily available are valued at their fair value under procedures established by the Board of Trustees. Bonds and other fixed income securities may be valued by reference to other securities with comparable ratings, interest rates and maturities, using established independent pricing services.

Investment Transactions
and Related Investment Income:
      Investment transactions are accounted for on the trade date. Dividend income is recorded on the ex-dividend date and any non-cash dividend income is recorded at the fair market value of the securities received. Interest income is recorded on an accrual basis. Realized
gains and losses from investment transactions are determined on the basis of identified cost for book and tax purposes.

Expenses:
      The Funds incur direct and indirect expenses. Expenses directly attributable to a Fund are charged to the Fund’s operations, while expenses applicable to more than one series of the Trust are allocated equitably. Allocated personnel and occupancy costs related to The Royce Funds are included in administrative and office facilities expenses. The Fund has adopted a deferred fee agreement that allows the Trustees to defer the receipt of all or a portion of Trustees Fees otherwise payable. The deferred fees are invested in certain Royce Funds until distribution in accordance with the agreement.

Distributions and Taxes:
      As qualified regulated investment companies under Subchapter M of the Internal Revenue Code, the Funds are not subject to income taxes to the extent that each Fund distributes substantially all of its taxable income for its fiscal year.
      Royce Total Return Fund and Royce Dividend Value Fund pay any dividends from net investment income quarterly and make any distributions from net realized gains annually in December. The other Funds pay any dividends and capital gain distributions annually in December. Because federal income tax regulations differ from generally accepted accounting principles, income and capital gain distributions determined in accordance with tax regulations may differ from net investment income and realized gains recognized for financial reporting purposes. Accordingly, the character of distributions and composition of net assets for tax purposes differs from those reflected in the accompanying financial statements.

Repurchase Agreements:
      The Funds entered into repurchase agreements with respect to portfolio securities solely with State Street Bank and Trust Company (“SSB&T”), the custodian of the Funds’ assets. Each Fund restricts repurchase agreements to maturities of no more than seven days. Securities pledged as collateral for repurchase agreements, which are held by SSB&T until maturity of the repurchase agreements, are marked-to-market daily and maintained at a value at least equal to the principal amount of the repurchase agreement (including accrued interest). Repurchase agreements could involve certain risks in the event of default or insolvency of SSB&T, including possible delays or restrictions upon the ability of each Fund to dispose of its underlying securities.

Securities Lending:
      The Funds loan securities to qualified institutional investors for the purpose of realizing additional income. Collateral on all securities loaned for the Funds is accepted in cash and cash equivalents and invested temporarily by the custodian. The collateral is equal to at least 100% of the current market value of the loaned securities.

76  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005

Capital Share Transactions (In Shares):
		Shares sold				Shares issued for reinvestment of distributions				Shares redeemed						Net increase (decrease) in shares outstanding
	Period ended 6/30/05 (unaudited)		Period ended 12/31/04		Period ended 6/30/05 (unaudited)		Period ended 12/31/04		Period ended 6/30/05 (unaudited)			Period ended 12/31/04			Period ended 6/30/05 (unaudited)			Period ended 12/31/04
Pennsylvania Mutual Fund
Investment Class		32,063,911		41,945,832		–		4,788,099		(11,655,014	)		(18,729,869	)		20,408,897			28,004,062
Consultant Class		10,515,464		23,976,793		–		3,868,233		(6,797,112	)		(6,695,939	)		3,718,352			21,149,087
Royce Micro-Cap Fund
Investment Class		3,550,668		5,123,700		–		2,614,412		(4,915,288	)		(6,536,395	)		(1,364,620	)		1,201,717
Consultant Class		897,336		1,875,139		–		1,053,615		(1,433,916	)		(1,584,830	)		(536,580	)		1,343,924
Institutional Class		922		–		–		34,285		(922	)		(334,896	)		–			(300,611	)
Financial Intermediary Class		7,373		64,739		–		6,676		(13,434	)		(11,464	)		(6,061	)		59,951
Royce Premier Fund
Investment Class		30,232,445		82,256,221		–		8,337,329		(42,141,921	)		(26,593,593	)		(11,909,476	)		63,999,957
Consultant Class		804,680		1,456,219		–		77,434		(190,257	)		(144,807	)		614,423			1,388,846
Institutional Class		6,128,178		5,441,712		–		202,115		(1,411,173	)		(611,392	)		4,717,005			5,032,435
Financial Intermediary Class		2,736,116		3,483,886		–		214,339		(999,096	)		(1,577,299	)		1,737,020			2,120,926
W Class		16,379,608				–				(127,041	)					16,252,567
Royce Low-Priced Stock Fund
Investment Class		23,555,310		148,028,874		–		10,401,741		(65,132,074	)		(65,129,367	)		(41,576,764	)		93,301,248
Royce Total Return Fund
Investment Class		59,022,696		130,787,570		1,161,203		6,352,446		(45,124,774	)		(46,307,783	)		15,059,125			90,832,233
Consultant Class		6,643,700		14,762,571		–		590,584		(2,630,139	)		(3,319,331	)		4,013,561			12,033,824
Institutional Class		2,978,254		4,423,915		48,254		202,668		(1,348,659	)		(857,294	)		1,677,849			3,769,289
Financial Intermediary Class		5,190,343		12,313,693		71,057		446,658		(2,561,371	)		(3,679,636	)		2,700,029			9,080,715
W Class		8,277,748				12,763				(53,229	)					8,237,282
Royce TrustShares Fund
Investment Class		86,087		913,039		–		380,480		(34,182	)		(24,531	)		51,905			1,268,988
Consultant Class		23,895		74,895		–		16,058		(4,647	)		(527	)		19,248			90,426
Consultant B Class				–				88,139					(739,446	)					(651,307	)
Royce Opportunity Fund
Investment Class		11,700,779		41,398,474		–		7,685,313		(21,085,046	)		(31,087,553	)		(9,384,267	)		17,996,234
Institutional Class		2,277,198		8,205,414		–		776,430		(3,479,678	)		(1,559,650	)		(1,202,480	)		7,422,194
Financial Intermediary Class		2,722,742		11,209,418		–		1,162,518		(5,094,113	)		(2,391,266	)		(2,371,371	)		9,980,670
Royce Special Equity Fund
Investment Class		2,108,789		13,620,772		–		1,679,596		(8,547,693	)		(11,770,898	)		(6,438,904	)		3,529,470
Consultant Class		58,646		516,241		–		34,241		(87,459	)		(64,676	)		(28,813	)		485,806
Institutional Class		1,195,188		7,756,436		–		262,461		(982,150	)		(451,861	)		213,038			7,567,036
Financial Intermediary Class		91,181		578,707		–		26,847		(49,092	)		(254,204	)		42,089			351,350
Royce Select Fund
Investment Class		2,730		16,370		–		13,007		(7,587	)		(19,214	)		(4,857	)		10,163
Royce Value Fund
Investment Class		3,569,080		4,348,867		–		82,926		(994,871	)		(432,114	)		2,574,209			3,999,679
Royce Value Plus Fund
Investment Class		10,187,258		20,092,191		–		62,295		(9,260,940	)		(3,165,770	)		926,318			16,988,716
Royce Technology Value Fund
Investment Class		778,766		2,927,413		–		584,738		(1,572,218	)		(10,348,141	)		(793,452	)		(6,835,990	)
Royce 100 Fund
Investment Class		461,723		842,511		–		29,278		(106,643	)		(47,153	)		355,080			824,636
Royce Discovery Fund
Investment Class		101,940		365,196		–		5,088		(97,196	)		(105,707	)		4,744			264,577
Royce Financial Services Fund
Investment Class		23,649		247,030		–		3,710		(8,643	)		(402	)		15,006			250,338
Royce Dividend Value Fund
Investment Class		272,427		296,036		1,978		–		(16,497	)		(4,135	)		257,908			291,901

THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  77

NOTES TO FINANCIAL STATEMENTS (Unaudited) (CONTINUED)

Investment Advisor and Distributor:
Investment Adviser: Under the Trust’s investment advisory agreements with Royce & Associates, LLC (“Royce”), Royce is entitled to receive management and performance fees that are computed daily and payable monthly. Royce has contractually committed to waive its fees and reimburse expenses to the extent necessary to maintain certain Funds’ net annual operating expense ratios at specified levels through December 31, 2005.

			Committed net annual
			operating expense ratio										Six months
	Annual contractual												ended June 30, 2005
	advisory fee as a								Financial
	percentage of		Investment		Consultant		Institutional		Intermediary		W		Net advisory		Advisory
	average net assets b		Class		Class		Class		Class		Class		fees		fees waived
Pennsylvania Mutual Fund	0.76	% a	N/A		N/A		N/A		N/A		N/A		$	7,908,538	$	–
Royce Micro-Cap Fund	1.30	%	N/A		2.99	%	1.35	%	1.49	%	N/A			3,972,368		–
Royce Premier Fund	0.98	%	N/A		2.99	%	1.04	%	1.29	%	1.08	%		15,623,591		–
Royce Low-Priced Stock Fund	1.12	%	1.49	%	N/A		N/A		N/A		N/A			23,535,188		166,856
Royce Total Return Fund	0.96	%	N/A		N/A		N/A		1.29	%	1.08	%		22,780,007		–
Royce TrustShares Fund	1.00	%	1.49	%	2.49	%	N/A		N/A		N/A			258,743		–
Royce Opportunity Fund	1.00	%	N/A		N/A		1.04	%	1.29	%	N/A			9,607,449		–
Royce Special Equity Fund	1.00	%	N/A		2.99	%	N/A		1.35	%	N/A			4,788,629		–
Royce Value Fund	1.00	%	1.49	%	N/A		N/A		N/A		N/A			250,696		–
Royce Value Plus Fund	1.00	%	1.49	%	N/A		N/A		N/A		N/A			1,113,644		–
Royce Technology Value Fund	1.50	%	1.99	%	N/A		N/A		N/A		N/A			217,361		6,913
Royce 100 Fund	1.00	%	1.49	%	N/A		N/A		N/A		N/A			28,625		21,940
Royce Discovery Fund	1.00	%	1.49	%	N/A		N/A		N/A		N/A			–		15,676
Royce Financial Services Fund	1.00	%	1.49	%	N/A		N/A		N/A		N/A			–		7,156
Royce Dividend Value Fund	1.00	%	1.49	%	N/A		N/A		N/A		N/A			–		10,156

a	Pennsylvania Mutual Fund’s fees are calculated at the annual rate of 1.0% of the first $50 million of the Fund’s average net assets, 0.875% of the next $50 million of average net assets and 0.75% of average net assets in excess of $100 million.
b	From a base annual rate of 1.00% (1.30% for Royce Micro-Cap Fund, 1.15% for Royce Low-Priced Stock Fund and 1.50% for Royce Technology Value Fund), the annual rates of management fees payable by each of the Funds, other than Pennsylvania Mutual Fund and Royce Select Fund, are reduced by the indicated amount at the following breakpoints applicable to a Fund’s net assets in excess of $2 billion:

•	More than $2 billion to $4 billion	.05% per annum
•	More than $4 billion to $6 billion	.10% per annum
•	Over $6 billion	.15% per annum

      Royce is entitled to receive from Royce Select Fund a performance fee of 12.5% of the Fund’s pre-fee total return, subject to high watermark accounting. Fund shares will not bear a fee for any day on which the Fund’s pre-fee cumulative total return does not exceed its pre-fee cumulative total return as of the day on which a fee was last accrued. However, Royce will not reimburse previously accrued fees because of any negative total returns occurring after their accrual. The agreement provides that all expenses of the Fund, except brokerage commissions, taxes, interest and extraordinary expenses, will be paid by Royce. For the six months ended June 30, 2005, the Fund accrued no performance fees.

Distributor: Royce Fund Services, Inc., the distributor of the Trust’s shares, is a wholly owned subsidiary of Royce.

		Six months ended June 30, 2005
	Annual contractual
	distribution fee as a percentage	Net		Distribution
	of average net assets	distribution fees		fees waived
Pennsylvania Mutual Fund – Consultant Class	1.00%	$	3,746,201	$	50,168
Royce Micro-Cap Fund – Consultant Class	1.00%		794,194		–
Royce Micro-Cap Fund – Financial Intermediary Class	0.25%		1,321		–
Royce Premier Fund – Consultant Class	1.00%		155,107		–
Royce Premier Fund – Financial Intermediary Class	0.25%		101,981		–
Royce Low-Priced Stock Fund – Investment Class	0.25%		4,158,571		1,131,490
Royce Total Return Fund – Consultant Class	1.00%		2,586,467		–
Royce Total Return Fund – Financial Intermediary Class	0.25%		341,060		–
Royce TrustShares Fund – Investment Class	0.25%		24,905		37,358
Royce TrustShares Fund – Consultant Class	1.00%		9,690		–
Royce Opportunity Fund – Financial Intermediary Class	0.25%		269,050		–
Royce Special Equity Fund – Consultant Class	1.00%		96,666		–
Royce Special Equity Fund – Financial Intermediary Class	0.25%		16,069		–
Royce Value Fund – Investment Class	0.25%		–		62,674
Royce Value Plus Fund – Investment Class	0.25%		–		278,411
Royce Technology Value Fund – Investment Class	0.25%		20,932		16,447
Royce 100 Fund – Investment Class	0.25%		–		12,641
Royce Discovery Fund – Investment Class	0.25%		–		3,919
Royce Financial Services Fund – Investment Class	0.25%		–		1,789
Royce Dividend Value Fund – Investment Class	0.25%		–		2,539

78  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005

Purchases and Sales of Investment Securities:

      For the six months ended June 30, 2005, the cost of purchases and the proceeds from sales of investment securities, other than short-term securities and collateral received for securities loaned, were as follows:

	Purchases		Sales			Purchases		Sales
Pennsylvania Mutual Fund	$	356,910,198	$	217,062,249	Royce Select Fund	$	9,849,536	$	12,260,906
Royce Micro-Cap Fund		86,687,253		130,396,051	Royce Value Fund		28,936,488		8,179,623
Royce Premier Fund		519,979,356		325,869,748	Royce Value Plus Fund		103,657,592		77,337,420
Royce Low-Priced Stock Fund		417,256,328		791,966,383	Royce Technology Value Fund		11,978,710		20,157,802
Royce Total Return Fund		963,069,643		474,158,408	Royce 100 Fund		5,504,964		2,800,304
Royce TrustShares Fund		34,909,233		27,157,973	Royce Discovery Fund		1,643,894		1,806,713
Royce Opportunity Fund		404,380,962		554,285,822	Royce Financial Services Fund		196,520		31,000
Royce Special Equity Fund		123,036,312		165,415,285	Royce Dividend Value Fund		1,405,893		26,979

Tax Information:

      At June 30, 2005, net unrealized appreciation (depreciation) based on identified cost for tax purposes was as follows:

			Net Unrealized			Gross Unrealized
			Appreciation
	Tax Basis Cost		(Depreciation)			Appreciation		Depreciation
Pennsylvania Mutual Fund	$	1,777,409,019	$	564,457,955		$	602,405,444	$	37,947,489
Royce Micro-Cap Fund		515,959,168		92,688,122			130,293,605		37,605,483
Royce Premier Fund		2,617,807,806		731,933,519			769,050,766		37,117,247
Royce Low-Priced Stock Fund		3,551,551,566		487,728,521			759,279,794		271,551,273
Royce Total Return Fund		4,129,605,555		935,248,929			1,024,850,761		89,601,832
Royce TrustShares Fund		47,602,014		4,530,303			6,833,855		2,303,552
Royce Opportunity Fund		1,818,590,885		240,204,654			372,009,284		131,804,630
Royce Special Equity Fund		754,635,863		158,858,281			172,871,316		14,013,035
Royce Select Fund		19,115,906		3,763,208			4,184,666		421,458
Royce Value Fund		57,890,412		4,773,736			6,762,640		1,988,904
Royce Value Plus Fund		200,400,100		8,639,127			21,697,995		13,058,868
Royce Technology Value Fund		30,447,328		(1,925,607	)		3,026,621		4,952,228
Royce 100 Fund		10,185,972		913,639			1,249,393		335,754
Royce Discovery Fund		3,072,095		138,144			217,380		79,236
Royce Financial Services Fund		1,373,431		110,824			153,587		42,763
Royce Dividend Value Fund		3,295,498		143,111			198,289		55,178

     The primary difference between book and tax basis cost is the timing of the recognition of losses on securities sold for book and tax purposes.

Transactions in Affiliated Companies:
     An “Affiliated Company,” as defined in the Investment Company Act of 1940, is a company in which a fund owns 5% or more of the company’s outstanding voting securities. The following transactions were effected in shares of such companies for the six months ended June 30, 2005.

Affiliated Company	Shares 12/31/04		Market Value 12/31/04		Cost of Purchases		Cost of Sales		Realized Gain (Loss)			Dividend Income		Shares 6/30/05	Market Value 6/30/05
Pennsylvania Mutual Fund
CNS *		839,877	$	10,540,456	$	14,426	$	3,805,379	$	4,162,244		$	92,446
Cutter & Buck		436,000		6,352,520		2,829,676		–		–			37,898	634,100	$	8,179,890
Hi-Tech Pharmacal *		435,100		8,023,244		543,831		1,457,835		631,924			–
InterVideo		996,800		13,187,664		–		2,560,994		1,268,334			–	758,500		10,907,230
Neoware Systems		1,259,823		11,727,692		49,260		3,645,009		1,228,671			–	847,523		8,678,636
Nu Horizons Electronics		1,218,134		9,720,709		887,721		–		–			–	1,344,234		8,603,098
Nutraceutical International		819,746		12,632,286		–		–		–			–	819,746		10,943,609
Pervasive Software		1,237,100		5,999,935		–		–		–			–	1,237,100		5,240,356
RemedyTemp Cl. A *		481,500		4,935,375		–		57,333		(7,422	)		–
Rimage Corporation		570,996		9,170,196		–		–		–			–	570,996		12,122,245
SM&A		855,400		7,297,417		1,335,888		–		–			–	1,017,900		9,130,563
Strattec Security		202,740		12,695,579		–		–		–			–	202,740		11,041,220
U.S. Physical Therapy		910,600		14,041,452		731,392		–		–			–	957,975		18,373,961
Weyco Group		263,175		11,656,021		4,983,000		–		–			65,794	775,500		15,281,227
Zapata Corporation		126,200		7,559,380		–		–		–			–	1,009,600		6,158,560
				145,539,926						7,283,751			196,138			124,660,595

THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  79

NOTES TO FINANCIAL STATEMENTS (Unaudited) (CONTINUED)

Transactions in Affiliated Companies (Continued):

Affiliated Company	Shares 12/31/04		Market Value 12/31/04		Cost of Purchases		Cost of Sales		Realized Gain (Loss)			Dividend Income		Shares 6/30/05	Market Value 6/30/05
Royce Micro-Cap Fund
AirNet Systems *		517,700	$	1,806,773	$	–	$	2,188,389	$	17,362		$	–
Dawson Geophysical *		325,700		7,116,545		899,150		–		–			–
InPlay Technologies		835,200		1,979,424		–		–		–			–	835,200	$	1,336,320
Jaco Electronics		382,250		1,529,000		–		–		–			–	382,250		1,131,460
Key Technology		379,983		3,666,836		62,845		1,465,100		(197,600	)		–	256,483		2,744,368
Peerless Manufacturing		156,400		2,267,800		–		–		–			–	156,400		2,267,800
				18,366,378						(180,238	)		-			7,479,948
Royce Premier Fund
Cabot Microelectronics		1,263,800		50,615,190		14,035,869		–		–			–	1,731,300		50,190,387
EGL		1,724,200		51,536,338		19,581,608		–		–			–	2,693,600		54,733,952
Ensign Energy Services		4,119,900		85,918,287		–		–		–			459,642	4,119,900		99,433,107
Lincoln Electric Holdings		2,054,497		70,962,326		22,534,741		–		–			990,395	2,769,597		91,812,141
Nu Skin Enterprises Cl. A		3,411,500		86,583,870		10,882,788		954,516		4,104			678,420	3,856,500		89,856,450
Ritchie Bros. Auctioneers		1,776,200		58,721,172		–		–		–			332,149	1,776,200		68,472,510
Schnitzer Steel Industries Cl. A		1,388,600		47,115,198		5,309,673		–		–			51,938	1,552,600		36,796,620
Simpson Manufacturing		2,408,400		84,053,160		10,346,020		–		–			243,590	2,763,400		84,421,870
Trican Well Service		1,338,000		73,956,446		17,225,557		6,213,251		1,492,380			–	4,635,400		113,955,475
Viasys Healthcare		1,981,900		37,656,100		–		–		–			–	1,981,900		44,771,121
Winnebago Industries		1,914,500		74,780,370		11,056,130		–		–			303,730	2,244,500		73,507,375
Woodward Governor Company		640,604		45,873,652		–		–		–			320,302	640,604		53,829,954
				767,772,109						1,496,484			3,380,166			861,780,962
Royce Low-Priced Stock Fund
Arctic Cat		1,525,860		40,465,807		–		2,509,888		1,044,240			204,695	1,398,360		28,708,331
Bioveris Corporation		1,270,200		9,285,162		2,589,009		–		–			–	1,834,100		8,015,017
Bruker BioSciences		5,562,700		22,417,681		1,636,725		–		–			–	6,009,800		23,979,102
Cache		997,300		17,971,346		837,663		–		–			–	1,067,800		17,746,836
Callaway Golf *		4,144,200		55,946,700		–		12,685,252		(3,581,163	)		517,202
CEVA		1,306,800		11,901,028		–		–		–			–	1,306,800		7,657,848
Cell Genesys		2,736,600		22,166,460		1,488,736		–		–			–	3,016,600		16,138,810
CoolBrands International		3,681,600		27,908,064		–		5,857,845		(4,619,212	)		–	3,331,600		11,203,226
CryptoLogic *		846,000		21,107,700		–		9,178,420		16,838,777			24,867
Discovery Partners International		1,885,200		8,954,700		–		–		–			–	1,885,200		5,391,672
ESS Technology		2,158,900		15,349,779		528,687		–		–			–	2,258,900		9,509,969
eFunds Corporation		3,718,800		89,288,388		449,650		3,922,950		902,013			–	3,524,700		63,409,353
Exar Corporation		2,956,850		41,957,702		1,998,694		–		–			–	3,106,850		46,260,996
Forrester Research		1,161,100		20,830,134		1,093,221		–		–			–	1,238,600		22,084,238
Gammon Lake Resources *		2,665,200		14,232,168		1,757,310		–		–			–
Harris Steel Group		77,000		1,289,627		25,697,601		–		–			178,440	1,584,000		26,632,713
Hecla Mining Company		11,741,500		68,452,945		–		–		–			–	11,741,500		53,541,240
Input/Output		6,652,900		58,811,636		–		–		–			–	6,652,900		41,780,212
Insituform Technologies Cl. A		2,544,900		57,692,883		1,465,699		–		–			–	2,644,900		42,397,747
Integral Systems		595,300		11,578,585		83,552		–		–			47,952	599,500		13,566,685
iPass		2,234,000		16,531,600		5,805,376		–		–			–	3,190,600		19,335,036
KVH Industries		1,254,100		12,290,180		–		729,164		(155,780	)		–	1,202,200		11,120,350
Keith Companies *		656,200		11,411,318		–		7,207,416		6,441,859			–
Lexicon Genetics		4,033,800		31,282,119		–		–		–			–	4,033,800		19,926,972
Metal Management		1,160,500		31,182,635		16,658,907		–		–			245,055	1,883,700		36,449,595
Minefinders Corporation		2,174,300		14,915,698		–		–		–			–	2,174,300		10,045,266
Multimedia Games		1,757,438		27,697,223		–		4,984,566		(2,116,953	)		–	1,452,438		15,991,342
New Frontier Media		1,159,500		9,182,081		–		–		–			–	1,159,500		7,710,675
Northern Orion Resources		8,582,600		24,975,366		688,025		–		–			–	8,832,600		21,639,870
Nu Skin Enterprises Cl. A *		3,523,900		89,436,582		–		4,116,197		1,113,437			625,302
Omega Protein		1,525,600		13,120,160		1,033,131		–		–			–	1,672,500		10,570,200
PC-Tel		1,358,600		10,773,698		–		–		–			–	1,358,600		10,637,838
PDI		–		–		15,885,605		–		–			–	844,000		10,406,520
Palm Harbor Homes		1,363,300		23,012,504		2,379,177		1,037,185		(129,774	)		–	1,463,300		27,553,939
Pason Systems		1,055,900		32,473,028		–		1,444,823		608,221			214,375	1,996,400		34,707,248
Perrigo Company *		4,126,800		71,269,836		2,097,977		360,546		(20,810	)		328,624
Possis Medical		466,200		6,284,376		6,678,378		681,263		(154,635	)		–	984,000		9,967,920
REMEC *		3,255,927		23,475,234		–		18,012,893		462,738			–
Select Comfort		2,563,400		45,987,396		–		13,488,482		2,988,972			–	1,843,400		39,504,062
Semitool		1,771,233		16,437,042		–		–		–			–	1,771,233		16,897,563

80  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005

Transactions in Affiliated Companies (Continued):

Affiliated Company	Shares 12/31/04		Market Value 12/31/04		Cost of Purchases		Cost of Sales		Realized Gain (Loss)			Dividend Income		Shares 6/30/05	Market Value 6/30/05
Royce Low-Priced Stock Fund (continued)
Silver Standard Resources		3,251,700	$	39,306,550	$	1,185,935	$	–	$	–		$	–	3,351,700	$	39,181,373
Stride Rite *		2,363,100		26,395,827		–		10,268,677		2,568,919			201,455
Tesco Corporation		2,225,600		24,259,040		24,990		–		–			–	2,227,700		24,371,038
Thoratec Corporation *		3,811,200		39,712,704		–		20,219,640		(280,673	)		–
Topps Company (The)		3,147,800		30,691,050		–		6,239,314		(1,028,968	)		244,221	2,604,616		26,124,298
Total Energy Services Trust		2,155,700		12,237,911		–		–		–			176,999	2,155,700		17,805,815
Transaction Systems
Architects Cl. A		2,561,000		50,835,850		–		–		–			–	2,561,000		63,077,430
VIVUS		2,845,000		12,660,250		2,788,711		–		–			–	3,638,300		13,407,136
				1,365,445,753						20,881,208			3,009,187			924,455,481
Royce Total Return Fund
Abigail Adams National Bancorp		199,100		3,844,621		727,568		–		–			49,775	244,400		3,971,500
Chase Corporation		164,800		2,620,320		1,528,789		–		–			–	273,800		3,833,200
Delta Apparel		204,400		4,956,700		4,764,185		–		–			43,402	763,460		9,871,538
Deswell Industries		476,700		11,783,547		668,996		291,340		3,391			247,620	740,043		11,529,796
EnergySouth		251,367		7,048,331		6,125,932		209,622		327			165,719	465,628		12,902,552
Fauquier Bankshares		172,900		4,365,725		1,017,649		–		–			62,793	213,300		5,545,800
Hardinge		482,700		6,516,450		–		–		–			28,962	482,700		6,781,935
Landauer		411,800		18,819,260		3,921,287		972,632		11,852			391,425	475,400		24,678,014
Lufkin Industries *		329,377		13,144,777		3,424,362		7,446,140		7,165,366			106,521
Mueller (Paul) Company		112,700		3,393,059		–		–		–			135,240	112,700		3,268,300
Preformed Line Products Company		307,900		8,922,942		1,584,299		301,242		16,324			130,759	345,894		14,112,475
Quixote Corporation		442,900		9,004,157		–		–		–			79,722	442,900		8,685,269
Sun Hydraulics *		347,650		5,551,971		1,064,841		890,363		1,665,480			44,181
				99,971,860						8,862,740			1,486,119			105,180,379
Royce Opportunity Fund
Ault		321,100		960,089		–		–		–			–	321,100		866,970
Bakers Footwear Group		253,200		2,544,660		579,460		–		–			–	308,800		3,381,360
Baldwin Technology Company Cl. A		745,300		2,235,900		77,380		–		–			–	773,000		2,396,300
Bell Industries		434,100		1,415,166		19,484		–		–			–	442,900		1,014,241
Computer Horizons		1,696,200		6,462,522		274,186		834,686		(313,935	)		–	1,617,500		5,062,775
Computer Task Group		1,046,400		5,859,840		611,854		–		–			–	1,216,100		4,390,121
Evans & Sutherland Computer		540,125		3,764,671		252,445		–		–			–	587,325		2,965,991
Flow International *		831,000		2,484,690		1,295,414		–		–			–
Gerber Scientific		1,265,800		9,632,738		447,668		41,455		1,851			–	1,323,400		9,210,864
Hawk Corporation Cl. A		631,800		5,458,752		–		887,507		728,553			–	487,400		5,702,580
Hurco Companies		345,300		5,697,450		975,074		825,093		177,202			–	361,000		5,761,560
Interphase Corporation		370,800		3,122,136		150,781		–		–			–	393,800		2,461,250
Lamson & Sessions Company		621,500		5,655,650		932,566		–		–			–	717,500		8,480,850
MagneTek *		1,398,700		9,651,030		1,099,448		7,640,332		(4,881,781	)		–
Rubio’s Restaurants		385,300		4,673,689		922,101		41,820		28,590			–	477,400		4,988,830
SCM Microsystems		680,920		3,322,890		988,556		–		–			–	934,620		2,579,551
Sigmatron International		124,500		1,686,975		1,039,595		–		–			–	210,400		2,236,552
TB Wood’s		272,800		1,707,728		–		–		–			–	272,800		1,527,680
TRC Companies		646,500		10,990,500		2,426,979		–		–			–	817,400		9,596,276
Tollgrade Communications		543,000		6,646,320		1,858,254		314,705		(103,558	)		–	707,900		5,309,250
				93,973,396						(4,363,078	)		–			77,933,001
Royce Special Equity Fund
CSS Industries		525,600		16,693,056		833,925		–		–			118,600	552,300		18,689,832
Chromcraft Revington		320,700		3,944,610		145,108		–		–			–	332,500		4,538,625
Flexsteel Industries		369,200		6,516,011		–		–		–			95,992	369,200		5,194,644
Frisch’s Restaurants		297,500		7,089,425		396,920		–		–			68,211	312,600		7,815,000
Hampshire Group		222,500		7,009,195		675,172		–		–			–	480,000		9,412,800
Hawkins		515,000		6,097,600		360,508		–		–			95,400	545,000		6,621,750
Lawson Products		431,100		21,740,373		3,297,566		–		–			194,364	505,000		19,604,100
Met-Pro Corporation		598,400		7,958,720		466,276		–		–			95,875	632,600		9,596,542
National Dentex		216,000		6,577,416		397,758		–		–			–	345,000		6,234,150
National Presto Industries		458,000		20,839,000		2,729,614		–		–			818,300	522,500		23,026,575
Superior Uniform Group		625,000		9,343,750		319,935		–		–			172,463	652,500		9,004,500
				113,809,156						–			1,659,205			119,738,518

*Not an Affiliated Company at June 30, 2005.

THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  81

UNDERSTANDING YOUR FUND’S EXPENSES (Unaudited)

As a shareholder of a mutual fund, you pay ongoing expenses, including management fees and other Fund expenses including, for some funds, distribution and/or service (12b-1) fees. Using the information below, you can estimate how these ongoing expenses (in dollars) affect your investment and compare them with the ongoing expenses of other funds. You may also incur one-time transaction expenses, including redemption fees, which are not shown in this section and would result in higher total costs. The example is based on an investment of $1,000 invested at January 1, 2005 and held for the entire six-month period ended June 30, 2005. Consultant and Financial Intermediary Class shares are generally available only through certain brokers or retirement plan administrators who receive distribution and/or service fees from the Fund for services that they perform. Institutional and W Class shares are generally available only to institutions or intermediaries with a minimum account size of $1 million. Actual Expenses      The first part of the table below provides information about actual account values and actual expenses. You may use the information in this section, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value at June 30, 2005 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 entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes      The second part of the table below provides information about hypothetical account values and hypothetical expenses based on the 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.      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 sales charges (loads), redemption fees, or exchange fees. Therefore, this section 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.

							HYPOTHETICAL
			ACTUAL				(5% per year return before expenses)
	Beginning		Ending		Expenses Paid		Beginning		Ending		Expenses Paid		Annualized
	Account Value		Account Value		During the		Account Value		Account Value		During the		Expense
	1/1/05		6/30/05		Period(1)		1/1/05		6/30/05		Period(1)		Ratio(2)
Investment Class
Pennsylvania Mutual Fund	$	1,000.00	$	1,025.60	$	4.52	$	1,000.00	$	1,020.33	$	4.51		0.90	%
Royce Micro-Cap Fund		1,000.00		966.90		7.17		1,000.00		1,017.50		7.35		1.47	%
Royce Premier Fund		1,000.00		998.00		5.65		1,000.00		1,019.14		5.71		1.14	%
Royce Low-Priced Stock Fund		1,000.00		959.60		7.24		1,000.00		1,017.41		7.45		1.49	%
Royce Total Return Fund		1,000.00		1,014.70		5.69		1,000.00		1,019.14		5.71		1.14	%
Royce TrustShares Fund(3)		1,000.00		950.00		7.06		1,000.00		1,017.55		7.30		1.46	%
Royce Opportunity Fund		1,000.00		966.90		5.61		1,000.00		1,019.09		5.76		1.15	%
Royce Special Equity Fund		1,000.00		977.10		5.64		1,000.00		1,019.09		5.76		1.15	%
Royce Select Fund		1,000.00		972.10		–		1,000.00		1,024.79		–		0.00	%
Royce Value Fund		1,000.00		1,020.30		6.76		1,000.00		1,018.10		6.76		1.35	%
Royce Value Plus Fund		1,000.00		946.10		5.69		1,000.00		1,018.94		5.91		1.18	%
Royce Technology Value Fund		1,000.00		915.30		9.45		1,000.00		1,014.93		9.94		1.99	%
Royce 100 Fund		1,000.00		1,002.90		7.40		1,000.00		1,017.41		7.45		1.49	%
Royce Discovery Fund		1,000.00		985.90		7.34		1,000.00		1,017.41		7.45		1.49	%
Royce Financial Services Fund		1,000.00		987.60		7.34		1,000.00		1,017.41		7.45		1.49	%
Royce Dividend Value Fund		1,000.00		987.60		7.34		1,000.00		1,017.41		7.45		1.49	%
Consultant Class
Pennsylvania Mutual Fund		1,000.00		1,020.50		9.42		1,000.00		1,015.47		9.39		1.88	%
Royce Micro-Cap Fund		1,000.00		961.80		12.01		1,000.00		1,012.55		12.33		2.47	%
Royce Premier Fund		1,000.00		993.20		10.87		1,000.00		1,013.88		10.99		2.20	%
Royce Total Return Fund		1,000.00		1,010.60		10.52		1,000.00		1,014.33		10.54		2.11	%
Royce TrustShares Fund(3)		1,000.00		945.10		12.01		1,000.00		1,012.45		12.42		2.49	%
Royce Special Equity Fund		1,000.00		971.20		11.00		1,000.00		1,013.64		11.23		2.25	%

82  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005

UNDERSTANDING YOUR FUND’S EXPENSES (Unaudited) (CONTINUED)

							HYPOTHETICAL
			ACTUAL				(5% per year return before expenses)
	Beginning		Ending		Expenses Paid		Beginning		Ending		Expenses Paid		Annualized
	Account Value		Account Value		During the		Account Value		Account Value		During the		Expense
	1/1/05		6/30/05		Period(1)		1/1/05		6/30/05		Period(1)		Ratio(2)
Institutional Class
Royce Micro-Cap Fund	$	1,000.00	$	967.00	$	6.58	$	1,000.00	$	1,018.10	$	6.76		1.35	%
Royce Premier Fund		1,000.00		998.00		5.10		1,000.00		1,019.69		5.16		1.03	%
Royce Total Return Fund		1,000.00		1,015.50		5.05		1,000.00		1,019.79		5.06		1.01	%
Royce Opportunity Fund		1,000.00		967.80		5.07		1,000.00		1,019.64		5.21		1.04	%
Royce Special Equity Fund		1,000.00		977.50		5.20		1,000.00		1,019.54		5.31		1.06	%
Financial Intermediary Class
Royce Micro-Cap Fund		1,000.00		966.20		7.26		1,000.00		1,017.41		7.45		1.49	%
Royce Premier Fund		1,000.00		997.30		6.39		1,000.00		1,018.40		6.46		1.29	%
Royce Total Return Fund		1,000.00		1,014.90		6.44		1,000.00		1,018.40		6.46		1.29	%
Royce Opportunity Fund		1,000.00		966.60		6.29		1,000.00		1,018.40		6.46		1.29	%
Royce Special Equity Fund		1,000.00		976.00		6.61		1,000.00		1,018.10		6.76		1.35	%
W Class
Royce Premier Fund		1,000.00		1,050.10		5.03		1,000.00		1,019.89		4.96		0.99	%
Royce Total Return Fund		1,000.00		1,038.50		5.10		1,000.00		1,019.79		5.06		1.01	%

(1)	Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value for the period, multiplied by 181 days in the most recent fiscal half year divided by 365 days (to reflect the half year period).
(2)	Annualized expense ratio used to derive figures in the table based on the most recent fiscal half year.
(3)	GiftShare accounts pay an annual $50 trustee fee to State Street Bank, NA, as trustee. If these fees were included above, your costs would be higher.

THE ROYCE FUNDS SEMIANNUAL REPORT 2005  |  83

NOTES TO PERFOMANCE AND OTHER IMPORTANT INFORMATION

The thoughts expressed in this report concerning recent market movements and future prospects for small company stocks are solely the opinion of Royce at June 30, 2005, and, of course, historical market trends are not necessarily indicative of future market movements. Statements regarding the future prospects for particular securities held in the Funds’ portfolios and Royce’s investment intentions with respect to those securities reflect Royce’s opinions as of June 30, 2005 and are subject to change at any time without notice. There can be no assurance that securities mentioned in this report will be included in any Royce-managed portfolio in the future.

The Russell 2000, Russell 2000 Value, Russell 2000 Growth, Russell 2500, Nasdaq Composite and S&P 500 are unmanaged indices of domestic common stocks. Returns for the market indices used in this report were based on information supplied to Royce by Frank Russell. Royce has not independently verified the above described information. The Royce Funds is a service mark of The Royce Funds. Distributor: Royce Fund Services, Inc.

The Funds invest primarily in securities of mid-, small- and/or micro-cap companies, that may involve considerably more risk than investments in securities of larger-cap companies (see “Primary Risks for Fund Investors” in the prospectus). Please read the prospectus carefully before investing or sending money. A copy of the Funds’ current prospectus and Statement of Additional Information may be obtained by calling 1-800-221-4268, or by visiting www.roycefunds.com. All publicly released material information is always disclosed by the Funds on their website at www.roycefunds.com.

Forward-Looking Statements

This material contains forward-looking statements within the meaning of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that involve risks and uncertainties, including, among others, statements as to:

•	the Funds’ future operating results
•	the prospects of the Funds’ portfolio companies
•	the impact of investments that the Funds have made or may make
•	the dependence of the Funds’ future success on the general economy and its impact on the companies and industries in which the Funds
	invest, and
•	the ability of the Funds’ portfolio companies to achieve their objectives.

This report uses words such as “anticipates,” “believes,” “expects, ” “future,” “intends,” and similar expressions to identify forward-looking statements. Actual results may differ materially from those projected in the forward looking statements for any reason.

The Royce Funds have based the forward-looking statements included in this report on information available to us on the date of the report, and we assume no obligation to update any such forward-looking statements. Although The Royce Funds undertake no obligation to revise or update any forward-looking statements, whether as a result of new information, future events or otherwise, you are advised to consult any additional disclosures that we may make through future shareholder communications or reports.

Proxy Voting

A copy of the policies and procedures that The Royce Funds use to determine how to vote proxies relating to portfolio securities and information regarding how each of The Royce Funds voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available, without charge on The Royce Funds’ website at www.roycefunds.com, by calling 1-800-221-4268 (toll-free) and on the website of the Securities and Exchange Commission (“SEC”), at www.sec.gov.

Form N-Q Filing

The Funds file their complete schedules of investments with the SEC for the first and third quarters of each fiscal year on Form N-Q. The Funds’ Forms N-Q are available on The Royce Funds’ website at www.roycefunds.com and on the SEC’s website at www.sec.gov. The Funds’ Forms N-Q may also be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. To find out more about this public service, call the SEC at 1-202-942-8090. The Funds’ complete schedules of investments are updated quarterly, and are available at www.roycefunds.com.

84  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005

BOARD APPROVAL OF INVESTMENT ADVISORY AGREEMENTS

     At meetings held on June 20-21, 2005, The Royce Fund’s Board of Trustees, including all of the non-interested trustees, approved the continuance of the Investment Advisory Agreements between Royce & Associates, LLC (“R&A”) and each of Pennsylvania Mutual Fund, Royce Micro-Cap Fund, Royce Premier Fund, Royce Low-Priced Stock Fund, Royce Total Return Fund, Royce TrustShares Fund, Royce Opportunity Fund, Royce Special Equity Fund, Royce Select Fund, Royce Value Fund, Royce Value Plus Fund, Royce Technology Value Fund, Royce 100 Fund, Royce Discovery Fund, Royce Financial Services Fund and Royce Dividend Value Fund (the “Funds”) and the Investment Sub-Advisory Agreement with JHC Capital Management, LLC (“JHC Capital”) relating to Royce Technology Value Fund (“RTV”). In reaching these decisions, the Board reviewed the materials provided by R&A, which included, among other things, information prepared internally by R&A and independently by Morningstar Associates, LLC (“Morningstar”) containing detailed expense ratio and investment performance comparisons for each of the Funds with other mutual funds in their “peer group”, information regarding the past performance of Funds managed by R&A and a memorandum outlining the legal duties of the Board prepared by independent counsel to the non-interested trustees. R&A also provided the trustees with an analysis of its profitability with respect to providing investment advisory services to each of the Funds. The Board also reviewed information provided by JHC Capital regarding RTV. In addition, the Board took into account information furnished throughout the year at regular Board meetings, including reports on investment performance, shareholder services, distribution fees and expenses, regulatory compliance, brokerage commissions and research, brokerage and execution products and services provided to the Funds. The Board also considered other matters it deemed important to the approval process such as payments made to R&A or its affiliates relating to distribution of Fund shares, allocation of Fund brokerage fees, and other direct and indirect benefits to R&A and its affiliates, from their relationship with the Funds. The trustees also met throughout the year with investment advisory personnel from R&A and JHC Capital. The Board, in its deliberations, recognized that, for many of the Funds’ shareholders, the decision to purchase Fund shares included a decision to select R&A as the investment adviser and that there was a strong association in the minds of Fund shareholders between R&A and each Fund. In considering factors relating to the approval of the continuance of the Investment Advisory Agreements and the Investment Sub-Advisory Agreement, the non-interested trustees received assistance and advice from, and met separately with, their independent counsel. While the Investment Advisory Agreements for the Funds and Investment Sub-Advisory Agreement for RTV were considered at the same Board meetings, the trustees dealt with each agreement separately. Among other factors, the trustees considered the following:
     The nature, extent and quality of services provided by R&A: The trustees considered the following factors to be of fundamental importance to their consideration of whether to approve the continuance of the Funds’ Investment Advisory Agreements: (i) R&A’s more than 30 years of small-cap value investing experience and track record; (ii) the history of long-tenured R&A portfolio managers managing many of the Funds; (iii) R&A’s sole focus on mid-cap, small-cap and micro-cap value investing; (iv) the consistency of R&A’s approach to managing the Funds’ over more than 30 years; (v) the integrity and high ethical standards adhered to at R&A; (vi) R&A’s specialized experience in the area of trading small- and micro-cap securities; (vii) R&A’s historical ability to attract and retain portfolio management talent and (viii) R&A’s focus on shareholder interests as exemplified by capping expenses on smaller funds, closing funds to new investors when R&A believed such closings were in the best interests of shareholders, establishing breakpoints for a number of funds and providing expansive shareholder reporting and communications. The trustees reviewed the services that R&A provides to the Funds, including, but not limited to, managing each Fund’s investments in accordance with the stated policies of each Fund. The trustees determined that the services to be provided to each Fund by R&A would be the same as those it previously provided to the Funds. They also took into consideration the histories, reputations and backgrounds of R&A’s portfolio managers for the Funds, finding that these would likely have an impact on the continued success of the Funds. Lastly, the trustees noted R&A’s ability to attract quality and experienced personnel. The trustees concluded that the services provided by R&A to each Fund compared favorably to services provided by R&A to other R&A client accounts, including other funds, in both nature and quality, and that the scope of services provided by R &A would continue to be suitable for each Fund. The trustees considered similar factors concerning JHC Capital and concluded that the scope of services provided by JHC Capital would be suitable for RTV.
     Investment performance of the Funds and R&A: In light of R&A’s risk-averse approach to investing, the trustees believe that risk-adjusted performance continues to be an appropriate measure of each Fund’s investment performance. One measure of risk-adjusted performance the trustees have historically used in their review of the Funds’ performance is the Sharpe Ratio. The Sharpe Ratio is a risk-adjusted measure of

THE ROYCE FUNDS SEMIANNUAL REPORT 2005 | 85

BOARD APPROVAL OF INVESTMENT ADVISORY AGREEMENTS (CONT.)

performance developed by Nobel Laureate William Sharpe. It is calculated by dividing a fund’s annualized excess return by its annualized standard deviation to determine reward per unit of risk. The higher the Sharpe Ratio, the better a fund’s historical risk-adjusted performance. The Board attaches primary importance to risk-adjusted performance over relatively long periods of time, typically three to five years. Except as described below, all of the Funds fell in the 1st or 2nd quartiles within their small-cap universe categories for the three and five-year periods ended December 31, 2004. Royce Opportunity Fund (“ROF”) placed in the 4th quartile for the three and five-year periods within Morningstar’s small value category. However, if Morningstar had used the small blend category for its peer comparison (ROF is currently in Morningstar’s small blend investment style box), ROF would place in the 2nd quartile for each period (its three and five-year Sharpe Ratios are almost identical to those of Royce Micro-Cap Fund). Royce Low-Priced Stock Fund (“RLP”) placed in the 4th quartile for the three-year period within its small blend category and approximately at the median within the small-cap fund universe, as its volatility (standard deviation) for the three-year period was higher than R&A would have expected. Its five-year results are in the 2nd quartile of both its category and the small-cap universe. Royce TrustShares Fund fell in the 3rd quartile for the three and five-year periods within its small blend category and approximately at the median within the small-cap universe. In addition to the Funds’ risk-adjusted performance the trustees also reviewed and considered each Funds’ absolute total returns, down-market performance and, for the Funds in existence for such periods, long-term performance records over periods of ten years or longer.
     The trustees noted that R&A manages a number of funds that invest in small-cap and micro-cap issuers, many of which were outperforming the Russell 2000 Index and their competitors. Although the trustees recognized that past performance is not necessarily an indicator of future results, they found that R&A had the necessary qualifications, experience and track record in managing small-cap and micro-cap securities to manage the Funds. The trustees determined that R&A continued to be an appropriate investment adviser for the Funds and concluded that each Fund’s performance supported the renewal of its Investment Advisory Agreement. The trustees reached similar conclusions for JHC Capital regarding the Investment Sub-Advisory Agreement for RTV.
     Cost of the services provided and profits realized by R &A from its relationship with each Fund: The trustees considered the cost of the services provided by R&A and profits realized by R&A from its relationship with each Fund. As part of the analysis, the Board discussed with R&A its methodology in allocating its costs to each Fund and concluded that its allocations were reasonable. The trustees noted that at times R&A had closed certain of the Funds to new investors because of the rate of growth in Fund assets. The trustees concluded that R&A’s profits were reasonable in relation to the nature and quality of services provided. The trustees also received information on the costs of the services provided and profits realized by JHC Capital with respect to RTV and concluded that JHC Capital’s profits were reasonable in relation to the nature and quality of services provided.
     The extent to which economies of scale would be realized as the Funds grow and whether fee levels would reflect such economies of sale: The trustees considered whether there have been economies of scale in respect of the management of the Funds, whether the Funds have appropriately benefited from any economies of scale and whether there is potential for realization of any further economies of scale. The trustees noted the time and effort involved in managing portfolios of small- and micro-cap stocks and that they did not involve the same efficiencies as do portfolios of large cap stocks. The trustees noted that in 2004 breakpoints had been added to the investment advisory fees for all Funds except Pennsylvania Mutual Fund (“PMF”) and Royce Select Funds (“RSF”) (PMF’s fee schedule already had breakpoints and RSF charges an all-inclusive performance fee) and that the contractual investment advisory fee rate for Royce Micro-Cap Fund and Royce Low-Priced Stock Fund had been reduced. The trustees concluded that the current fee structure for each Fund was reasonable, and that no changes were currently necessary.
     Comparison of services to be rendered and fees to be paid to those under other investment advisory contracts, such as contracts of the same and other investment advisers or other clients: The trustees reviewed the investment advisory fee paid by each Fund and compared both the services to be rendered and the fees to be paid under the Investment Advisory Agreements to other contracts of R&A and to contracts of other investment advisers to registered investment companies investing in small- and micro-cap stocks, as provided by Morningstar. The trustees noted the importance of the net expense ratio in measuring a fund’s efficiency, particularly in light of the variations in the mutual fund industry as to who is responsible for which expenses. Except as described below, the net expense ratios for the Funds ranked within the 1st and 2nd quartile among their peers, as selected by Morningstar. It was noted that RLP’s net expense ratio was in the 4th quartile of the Morningstar peer group, but excluding distribution fees for RLP and other funds in the peer group, and giving effect to the breakpoints in

86  |  THE ROYCE FUNDS SEMIANNUAL REPORT 2005

BOARD APPROVAL OF INVESTMENT ADVISORY AGREEMENTS (CONT.)

the investment advisory fee that went into effect in 2004 (Morningstar did not reflect this), RLP’s expense ratio is virtually equal to its Morningstar peer group average. Royce Select Fund (“RSF”) also had a net expense ratio in the 4th quartile of the Morningstar peer group, but the trustees noted that due to the unique nature of RSF’s expense structure, direct comparisons to other funds were not helpful. RSF pays an all-inclusive management fee equal to 12.5% of its pre-fee total return, measured using a high watermark test. It was noted that this methodology led to an expense ratio in the 1st quartile in 2002, and that RSF’s high watermark return in 2004 led to a high expense ratio that is not appropriate for peer analysis. It was noted that Royce TrustShares’ net expense ratio was in the 3rd quartile of its Morningstar peers due in large part to its small asset base, and that it should benefit to the extent assets grow. RTV’s expense ratio placed it in the 4th quartile of its Morningstar peers, but it was noted that RTV’s investment approach is significantly different from most of the funds in the Morningstar technology category, which invest in stocks having much larger market capitalizations. The trustees noted that the level of research necessary for a small-cap oriented bottom-up approach, as used by JHC Capital for RTV, is greater than necessary for larger-cap stocks. Royce Value Fund’s net expense ratio placed it in the 3rd quartile of the Morningstar peers due to its relatively low level of average net assets, and it was noted that R&A has capped the expenses of this Fund since its inception.
     The trustees noted that R&A has waived advisory fees in order to maintain expense ratios at competitive levels and acknowledged R&A’s intention to continue this expense limitation practice. The trustees also considered fees charged by R&A to institutional and other clients and noted that the Funds’ advisory fees compared favorably to these other accounts.
     After the non-interested trustees deliberated in executive session, the entire Board, including all the non-interested trustees, approved the renewal of the existing Investment Advisory Agreements and the Investment Sub-Advisory Agreement, concluding that a contract renewal on the existing terms was in the best interest of the shareholders of each Fund and that each investment advisory fee rate was reasonable in relation to the services provided.

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TheRoyceFunds Wealth Of Experience With approximately $20.6 billion in open- and closed-end fund assets under management, Royce & Associates is committed to the same small-company investing principles that have served us well for more than 30 years. Charles M. Royce, our Chief Investment Officer, enjoys one of the longest tenures of any active mutual fund manager. Royce’s investment staff includes six other Portfolio Managers, as well as eight assistant portfolio managers and analysts, and six traders. Multiple Funds, Common Focus Our goal is to offer both individual and institutional investors the best available small-cap value portfolios. Unlike a lot of mutual fund groups with broad product offerings, we have chosen to concentrate on small-company value investing by providing investors with a range of funds that take full advantage of this large and diverse sector. Consistent Discipline Our approach emphasizes paying close attention to risk and maintaining the same discipline, regardless of market movements and trends. The price we pay for a security must be significantly below our appraisal of its current worth. This requires a thorough analysis of the financial and business dynamics of an enterprise, as though we were purchasing the entire company. Co-Ownership Of Funds It is important that our employees and shareholders share a common financial goal; our officers, employees and their families currently have approximately $87 million invested in The Royce Funds.
General Information Additional Report Copies and Prospectus Inquiries (800) 221-4268 Shareholder Services (800) 841-1180 Automated Telephone Services (800) 78-ROYCE (787-6923)	Advisor Services For Fund Materials, Performance Updates, Transactions or Account Inquiries (800) 33-ROYCE (337-6923) Broker/Dealer Services For Fund Materials and Performance Updates (800) 59-ROYCE (597-6923)
www.roycefunds.com
This report must be accompanied or preceded by a current prospectus for the Funds. Please read the prospectus carefully before investing or sending money.
OE-RPT-0605

Item 2: Code(s) of Ethics – Not applicable to this semi-annual report.

Item 3: Audit Committee Financial Expert – Not applicable to this semi-annual report.

Item 4: Principal Accountant Fees and Services – Not applicable to this semi-annual report.

Item 5: Not Applicable.

Item 6: Schedule of Investments – See Item 1.

Item 7: Not applicable.

Item 8: Not Applicable.

Item 9: Submission of Matters to a Vote of Security Holders – None.

Item 10: Controls and Procedures.

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

(b) Internal Control over Financial Reporting. There were no significant changes in Registrant’s internal control over financial reporting or in other factors that could significantly affect this control subsequent to the date of the evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

Item 11: Exhibits attached hereto.

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

THE ROYCE FUND

BY:	/s/ Charles M. Royce
	Charles M. Royce
	President

Date: August 23, 2005

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

THE ROYCE FUND THE ROYCE FUND

BY:	/s/ Charles M. Royce	BY:	John D. Diederich
	Charles M. Royce		John D. Diederich
	President		Chief Financial Officer
Date: August 23, 2005		Date: August 23, 2005