SEC File No. 333-68239

                          Filed Pursuant to Rule 497(h)

                              PROSPECTUS SUPPLEMENT
                       (TO PROSPECTUS DATED JUNE 18, 1999)

                            PILGRIM PRIME RATE TRUST

                      319,658 SHARES OF BENEFICIAL INTEREST

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     On September 9, 1999 Pilgrim  Prime Rate Trust (the  "Trust")  sold 319,658
shares of  beneficial  interest of the Trust  through a  broker-dealer  that has
entered into a selected dealer agreement with Pilgrim Securities,  Inc. ("PSI"),
which is the  underwriter  for the Trust in connection  with this offering.  The
executed  sales  price at which the  shares  were sold  during  that  period was
$9.4375

Gross Proceeds ................................................    $3,016,772.38
Broker-Dealer Commissions......................................    $  120,670.90
Net Proceeds to Trust..........................................    $2,896,101.48

     On  September  9, 1999 the last  reported  sales price of the Shares on the
NYSE was 9 1/2.

     Note: S.E.C. fees were not used in arriving at any of the above figures.

NEITHER  THE  SECURITIES  AND  EXCHANGE  COMMISSION  NOR  ANY  STATE  SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES, OR DETERMINED THAT THIS
PROSPECTUS  IS TRUTHFUL OR  COMPLETE.  ANY  REPRESENTATION  TO THE CONTRARY IS A
CRIMINAL OFFENSE.

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          The date of this Prospectus Supplement is September 10, 1999.