Short Duration Income Portfolio

Short Duration Income Portfolio

Objective

The Short Duration Income Portfolio (the "Portfolio") seeks above-average total return over a market cycle of three to five years.

Fees and Expenses

The table below describes the fees and expenses that you may pay if you buy and hold shares of the Portfolio.

Shareholder Fees (fees paid directly from your investment)

Shareholder Fees - Short Duration Income Portfolio	Class I Shares	Class A Shares	Class L	Class C		Class IS
Maximum sales charge (load) imposed on purchases (as a percentage of offering price)	none	none	none	none		none
Maximum deferred sales charge (load) (as a percentage based on the lesser of the offering price or NAV at redemption)	none	none	none	1.00%	[1]	none

Annual Portfolio Operating Expenses(expenses that you pay each year as a percentage of the value of your investment)

Annual Fund Operating Expenses - Short Duration Income Portfolio		Class I Shares	Class A Shares	Class L	Class C	Class IS
Advisory Fee		0.20%	0.20%	0.20%	0.20%	0.20%
Distribution and/or Shareholder Service (12b-1) Fee		none	0.25%	0.50%	1.00%	none
Other Expenses		0.43%	0.35%	1.11%	2.72%	16.92%
Total Annual Portfolio Operating Expenses	[1]	0.63%	0.80%	1.81%	3.92%	17.12%
Fee Waiver and/or Expense Reimbursement	[1]	0.33%	0.28%	1.01%	2.62%	16.87%
Total Annual Portfolio Operating Expenses After Fee Waiver and/or Expense Reimbursement	[1]	0.30%	0.52%	0.80%	1.30%	0.25%

Example

The example below is intended to help you compare the cost of investing in the Portfolio with the cost of investing in other mutual funds.

The example assumes that you invest $10,000 in the Portfolio, your investment has a 5% return each year and that the Portfolio's operating expenses remain the same (except that the example incorporates the fee waiver and/or expense reimbursement arrangement for only the first two years). Although your actual costs may be higher or lower, based on these assumptions your costs would be:

If You SOLD Your Shares:

Expense Example - Short Duration Income Portfolio - USD ($)	1 Year	3 Years	5 Years	10 Years
Class I Shares	31	168	319	755
Class A Shares	53	227	417	964
Class L	82	471	886	2,043
Class C	232	954	1,794	3,974
Class IS	26	3,191	5,635	9,580

If You HELD Your Shares

Expense Example No Redemption - Short Duration Income Portfolio - USD ($)	1 Year	3 Years	5 Years	10 Years
Class I Shares	31	168	319	755
Class A Shares	53	227	417	964
Class L	82	471	886	2,043
Class C	132	954	1,794	3,974
Class IS	26	3,191	5,635	9,580

Portfolio Turnover

The Portfolio pays transaction costs when it buys and sells securities (or "turns over" its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Portfolio shares are held in a taxable account. These costs, which are not reflected in Total Annual Portfolio Operating Expenses or in the Example, affect the Portfolio's performance. During the most recent fiscal year, the Portfolio's portfolio turnover rate was 66% of the average value of its portfolio.

Principal Investment Strategies

Under normal market conditions, substantially all of the Portfolio's assets will be invested in investment grade fixed income securities denominated in U.S. dollars. This policy may be changed without shareholder approval; however, you would be notified in writing of any changes. The Portfolio invests primarily in U.S. government securities, investment grade corporate bonds and mortgage- and asset-backed securities. The Portfolio will ordinarily seek to maintain an average duration of approximately one year or less. With respect to corporate issuers, the Portfolio will not purchase securities with remaining maturities of more than 3.25 years subsequent to the Reorganization (as defined in the section of the Prospectus entitled "Fund Management—Advisory Fees").

The Adviser employs a value approach toward fixed income investing and makes securities and sector decisions based on the anticipated tradeoff between long-run expected return and risk. The Portfolio seeks value in the fixed income market with only a limited sensitivity to changes in interest rates. The Adviser relies upon value measures such as the level of real interest rates, yield curve slopes and credit-adjusted spreads to guide its decisions regarding interest rate, country, sector and security exposure. A team of portfolio managers implements strategies based on these types of value measures. Certain team members focus on specific bonds within each sector. Others seek to ensure that the aggregate risk exposures to changes in the level of interest rates and yield spreads match the Portfolio's objective.

The Portfolio's mortgage securities may include collateralized mortgage obligations ("CMOs") and commercial mortgage-backed securities ("CMBS"). The Portfolio may also invest in asset-backed securities.

The Portfolio may invest in securities of foreign issuers, including issuers located in emerging market or developing countries, although only U.S. dollar denominated investment grade securities may be held in the Portfolio. The Portfolio may also invest in restricted and illiquid securities.

The Portfolio may, but it is not required to, use derivative instruments for a variety of purposes, including hedging, risk management, portfolio management or to earn income. The Portfolio's use of derivatives may involve the purchase and sale of derivative instruments such as futures, options, swaps and other related instruments and techniques.

Principal Risks

There is no assurance that the Portfolio will achieve its investment objective, and you can lose money investing in this Portfolio. The principal risks of investing in the Portfolio include:

•  Fixed Income Securities. Fixed income securities are subject to the risk of the issuer's inability to meet principal and interest payments on its obligations (i.e., credit risk) and are subject to price volatility resulting from, among other things, interest rate sensitivity, market perception of the creditworthiness of the issuer and general market liquidity (i.e., market risk). The historically low interest rate environment increases the risk associated with rising interest rates, including the potential for periods of volatility and increased redemptions. The Portfolio may face a heightened level of interest rate risk, especially since the Federal Reserve Board has ended its quantitative easing program and has begun to raise rates. The Portfolio may be subject to certain liquidity risks that may result from the lack of an active market and the reduced number and capacity of traditional market participants to make a market in fixed-income securities. Securities with longer durations are likely to be more sensitive to changes in interest rates, generally making them more volatile than securities with shorter durations. Lower rated fixed income securities have greater volatility because there is less certainty that principal and interest payments will be made as scheduled.

•  Mortgage-Backed Securities. Mortgage-backed securities entail prepayment risk, which generally increases during a period of falling interest rates. Rising interest rates tend to discourage refinancings, with the result that the average life and volatility of mortgage-backed securities will increase and market price will decrease. Rates of prepayment, faster or slower than expected by the Adviser, could reduce the Portfolio's yield, increase the volatility of the Portfolio and/or cause a decline in NAV. Certain mortgage-backed securities may be more volatile and less liquid than other traditional types of debt securities. In addition, an unexpectedly high rate of defaults on the mortgages held by a mortgage pool may adversely affect the value of a mortgage-backed security and could result in losses to the Portfolio. Investments in mortgage-backed securities may give rise to a form of leverage and may cause the Portfolio's turnover rate to appear higher. Leverage may cause the Portfolio to be more volatile than if the Portfolio had not been leveraged.

•Asset-Backed Securities. Asset-backed securities involve the risk that various federal and state consumer laws and other legal and economic factors may result in the collateral backing the securities being insufficient to support payment on the securities. Some asset-backed securities also entail prepayment risk, which may vary depending on the type of asset.

•  Foreign and Emerging Market Securities. Investments in foreign markets entail special risks such as currency, political, economic and market risks. There also may be greater market volatility, less reliable financial information, higher transaction and custody costs, decreased market liquidity and less government and exchange regulation associated with investments in foreign markets. In addition, investments in certain foreign markets that have historically been considered stable may become more volatile and subject to increased risk due to ongoing developments and changing conditions in such markets. Moreover, the growing interconnectivity of global economies and financial markets has increased the probability that adverse developments and conditions in one country or region will affect the stability of economies and financial markets in other countries or regions. The risks of investing in emerging market countries are greater than risks associated with investments in foreign developed countries.

•  Liquidity. The Portfolio's investments in restricted and illiquid securities may entail greater risk than investments in other types of securities. These securities may be more difficult to sell, particularly in times of market turmoil. Additionally, the market for certain investments deemed liquid at the time of purchase may become illiquid under adverse market or economic conditions. Liquidity risk may be magnified in a rising interest rate environment or in other circumstances where investor redemptions from fixed income mutual funds may be higher than normal. Illiquid securities may be more difficult to value. If the Portfolio is forced to sell an illiquid security to fund redemptions or for other cash needs, it may be forced to sell the security at a loss.

•  Derivatives. A derivative instrument often has risks similar to its underlying asset and may have additional risks, including imperfect correlation between the value of the derivative and the underlying asset, risks of default by the counterparty to certain transactions, magnification of losses incurred due to changes in the market value of the securities, instruments, indices or interest rates to which the derivative instrument relates and risks that the transactions may not be liquid. Certain derivative transactions may give rise to a form of leverage. Leverage magnifies the potential for gain and the risk of loss.

Shares of the Portfolio are not bank deposits and are not guaranteed or insured by the Federal Deposit Insurance Corporation or any other government agency.

Performance Information

The bar chart and table below provide some indication of the risks of investing in the Portfolio by showing changes in the Portfolio's Class I shares' performance from year-to-year and by showing how the Portfolio's average annual returns for the past one, five and 10 year periods and since inception compare with those of broad measures of market performance, as well as an index that represents a group of similar mutual funds, over time. The performance of the other Classes, which is shown in the table below, will differ because the Classes have different ongoing fees. The Portfolio's returns in the table include the maximum applicable sales charge for Class C and assume you sold your shares at the end of each period (unless otherwise noted).The Portfolio's past performance, before and after taxes, is not necessarily an indication of how the Portfolio will perform in the future. Updated performance information is available online at www.morganstanley.com/im or by calling toll-free (800) 548-7786.

Annual Total Returns—Calendar Years

High Quarter	9/30/16	3.67	%
Low Quarter	9/30/08	–8.87	%

Average Annual Total Returns (for periods ended December 31, 2016)

Average Annual Returns - Short Duration Income Portfolio		Average Annual Returns, Past 1 Year	Average Annual Returns, Past 5 Years	Average Annual Returns, Past 10 Years	Average Annual Returns, Since Inception		Average Annual Returns, Inception Date
Class I Shares	[1]	8.37%	2.84%	0.41%	3.16%		Mar. 31, 1992
Class A Shares	[1]	8.11%	2.58%		(0.13%)		Sep. 28, 2007
Class L	[1]	7.80%			2.03%		Apr. 27, 2012
Class C	[1]	6.16%			3.40%		Apr. 30, 2015
Class IS	[1],[2]						Jan. 11, 2016
After Taxes on Distributions | Class I Shares	[1]	7.46%	2.13%	(0.60%)	1.64%
After Taxes on Distributions and Sale of Fund Shares | Class I Shares	[1]	4.72%	1.86%	(0.08%)	1.84%
Bank of America/Merrill Lynch 1-Year U.S. Treasury Note Index (reflects no deduction of fees, expenses or taxes)	[1],[3]	0.76%	0.32%	1.43%	2.83%	[4]	Mar. 31, 1992
Short Duration Income Blend Index (reflects no deduction of fees, expenses or taxes)	[1],[5]	0.90%	0.85%	2.41%	4.11%	[4]	Mar. 31, 1992
Bloomberg Barclays 1-3 Year U.S. Government/ Credit Index (reflects no deduction of fees, expenses or taxes)	[1],[6]	1.28%	0.92%	2.44%	4.12%	[4]	Mar. 31, 1992
Lipper Short Investment Grade Debt Funds Index (reflects no deduction for taxes)	[1],[7]	2.09%	1.63%	2.41%	3.90%	[4]	Mar. 31, 1992

The after-tax returns shown in the table above are calculated using the historical highest individual federal marginal income tax rates during the period shown and do not reflect the impact of state and local taxes. After-tax returns for the Portfolio's other Classes will vary from Class I shares' returns. Actual after-tax returns depend on the investor's tax situation and may differ from those shown, and after-tax returns are not relevant to investors who hold their Portfolio shares through tax deferred arrangements such as 401(k) plans or individual retirement accounts. After-tax returns may be higher than before-tax returns due to foreign tax credits and/or an assumed benefit from capital losses that would have been realized had Portfolio shares been sold at the end of the relevant periods, as applicable.

[1] The Class C contingent deferred sales charge ("CDSC") is only applicable if you sell your shares within one year after purchase. See "Shareholder Information-How to Redeem Portfolio Shares" for a complete discussion of the CDSC.

[1] The Portfolio's "Adviser," Morgan Stanley Investment Management Inc., has agreed to reduce its advisory fee and/or reimburse the Portfolio so that Total Annual Portfolio Operating Expenses, excluding certain investment related expenses, taxes, interest and other extraordinary expenses (including litigation), will not exceed 0.30% for Class I, 0.55% for Class A, 0.80% for Class L, 1.30% for Class C and 0.25% for Class IS. The fee waivers and/or expense reimbursements will continue for at least one year or until such time as the Board of Trustees of Morgan Stanley Institutional Fund Trust (the "Fund") acts to discontinue all or a portion of such waivers and/or reimbursements when it deems such action is appropriate.

[1] During 2016, the Portfolio received proceeds related to certain non-recurring litigation settlements. Had these settlements not occurred, the one, five and 10 year and since inception (where applicable) returns before and after taxes for such periods would have been lower. Please refer to the Financial Highlights for further information.

[2] Class IS shares of the Portfolio had not completed a full calendar year of operations as of December 31, 2016 and therefore Class IS shares do not have annualized return information to report.

[3] The Bank of America/Merrill Lynch 1-Year U.S. Treasury Note Index tracks one-year U.S. government securities. It is not possible to invest directly in an index. The Portfolio's primary benchmark was changed to the Bank of America/Merrill Lynch 1-Year U.S. Treasury Note Index to more accurately reflect the Portfolio's new investible universe effective January 8, 2016.

[4] Since Inception reflects the inception date of Class I.

[5] The Short Duration Income Blend Index is a performance linked benchmark of the old and new benchmark of the Portfolio, the old represented by Bloomberg Barclays 1-3 Year U.S. Government/Credit Index from the Portfolio's inception to January 8, 2016, and the new represented by Bank of America/Merrill Lynch 1-Year U.S. Treasury Note Index for periods thereafter. It is not possible to invest directly in an Index.

[6] The Bloomberg Barclays 1-3 Year U.S. Government/Credit Index tracks the securities in the 1-3 year maturity range of the Bloomberg Barclays U.S. Government/Credit Index which tracks investment-grade (BBB-/Baa3) or higher publicly traded fixed rate U.S. government, U.S. agency, and corporate issues. It is not possible to invest directly in an index.

[7] The Lipper Short Investment Grade Debt Funds Index is an equally weighted performance index of the largest qualifying funds (based on net assets) in the Lipper Short Investment Grade Debt Funds classification. There are currently 30 funds represented in this Index.