UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED MANAGEMENT INVESTMENT COMPANY

Investment Company Act file number 811-05642

American Income Fund, Inc.

(Exact name of registrant as specified in charter)

800 Nicollet Mall, Minneapolis, MN 55402

(Address of principal executive offices) (Zip code)

Charles D. Gariboldi, Jr., 800 Nicollet Mall, Minneapolis, MN 55402

(Name and address of agent for service)

(800) 677-3863

(Registrant's telephone number, including area code)

Date of fiscal year end: August 31, 2008

Date of reporting period: November 30, 2007

Item 1—Schedules of Investments.

Schedule ofINVESTMENTS(unaudited)

American Income Fund November 30, 2007

Description of Security	Principal Amount		Market Value (a)
(Percentages of each investment category relate to net assets)
High Yield Corporate Bonds — 24.2%
Basic Industry — 4.2%
Evraz Group, 8.25%, 11/10/15 (b)	$	250,000	$	248,775
FMG Finance Property, 10.00%, 9/1/13 (b)		250,000		275,000
Georgia Pacific, 7.13%, 1/15/17 (b)		250,000		239,375
Griffin Coal Mining, 9.50%, 12/1/16 (b)		200,000		190,000
Hexion, 9.75%, 11/15/14		250,000		268,750
Ineos Group Holdings, 8.50%, 2/15/16 (b)		150,000		135,000
Lyondell Chemical Company, 8.00%, 9/15/14		250,000		283,125
Massey Energy, 6.88%, 12/15/13		250,000		236,250
Momentive Performance Materials, 9.75%, 12/1/14 (b)		250,000		231,875
Newark Group, 9.75%, 3/15/14		200,000		192,000
Noble Group, 6.63%, 3/17/15 (b)		250,000		232,196
Noranda Aluminum Acquisition, 9.36%, 5/15/15 (b)		250,000		215,000
Nova Chemicals, 6.50%, 1/15/12		250,000		234,375
Sino Forest, 9.13%, 8/17/11 (b)		250,000		261,250
Stone Container, 8.38%, 7/1/12		200,000		195,500
				3,438,471
Capital Goods — 0.9%
Allied Waste North America, 6.13%, 2/15/14		300,000		288,750
L3 Communications, 7.63%, 6/15/12		300,000		307,875
Solo Cup, 8.50%, 2/15/14		150,000		129,750
				726,375
Communications — 3.6%
CCH I, 11.75%, 5/14/15		150,000		130,500
CCO Holding LLC, 8.75%, 11/15/13		500,000		488,750
CSC Holdings, Series B, 7.63%, 4/1/11		250,000		245,000
Dex Media, 8.00%, 11/15/13		200,000		191,000
DirectTV Holdings LLC, 8.38%, 3/15/13		250,000		259,375
Idearc, 8.00%, 11/15/16		250,000		233,750
Intelsat, 8.63%, 1/15/15		250,000		251,875
Level 3 Financing, 12.25%, 3/15/13		250,000		249,375
MetroPCS Wireless, 9.25%, 11/1/14		250,000		236,875
Panamsat, 9.00%, 6/15/16		250,000		253,750
Time Warner Telecommunications Holdings, 9.25%, 2/15/14		175,000		178,938
Vimpelcom, 8.25%, 5/23/16 (b)		250,000		253,175
				2,972,363
Consumer Cyclical — 4.4%

American Axle & Manufacturing, 7.88%, 3/1/17	250,000	231,250
Buffalo Thunder Development Authority, 9.38%, 12/14/15 (b)	250,000	225,000
Ford Motor, 7.45%, 7/16/31	250,000	188,750
Ford Motor Credit, 7.00%, 10/1/13	500,000	436,693
Galaxy Entertainment, 9.88%, 12/15/12 (b)	250,000	262,500
General Motors, 8.25%, 7/15/23	250,000	205,000
General Motors Acceptance Corporation,
5.63%, 5/15/09	300,000	283,600
6.88%, 9/15/11	200,000	174,740
Goodyear Tire & Rubber, 7.86%, 8/15/11	200,000	204,000
Hanesbrands, 8.73%, 12/15/14 (c)	250,000	246,250
KB Home, 7.75%, 2/1/10	150,000	140,250
Libbey Glass, 12.35%, 6/1/11 (c)	200,000	212,000
Michaels Stores, 10.00%, 11/1/14	150,000	142,875
Mohegan Tribal Gaming, 6.38%, 7/15/09	250,000	248,125
Rite Aid, 7.50%, 3/1/17	200,000	180,000
Wynn Las Vegas, 6.63%, 12/1/14	250,000	242,500
		3,623,533
Consumer Non Cyclical — 3.2%
Bausch & Lomb, 9.88%, 11/1/15 (b)	200,000	202,500

2007 Quarterly Report 1 American Income Fund

Schedule ofINVESTMENTS(unaudited)

American Income Fund (continued)

Description of Security	Principal Amount		Market Value (a)
Cardinal Health 409, 9.50%, 4/15/15 (b)	$	250,000	$	227,500
Community Health Systems, 8.88%, 7/15/15		250,000		252,500
Delhaize America, 9.00%, 4/15/31		231,000		274,446
HCA, 6.50%, 2/15/16		350,000		291,375
Health Management Associates, 6.13%, 4/15/16		250,000		216,995
Omnicare, 6.75%, 12/15/13		200,000		184,000
Smithfield Foods, 7.75%, 5/15/13		250,000		247,500
Stater Brothers Holdings, 7.75%, 4/15/15		250,000		242,500
Supervalu, 7.50%, 5/15/12		250,000		262,296
Vitro SAB, 9.13%, 2/1/17		250,000		233,125
				2,634,737
Electric — 2.4%
Allegheny Energy Supply, 7.80%, 3/15/11		200,000		210,000
Ava Capital Trust III, 6.50%, 4/1/34 (c)		300,000		299,209
Dynegy Holdings, 7.75%, 6/1/19 (b)		500,000		450,000
ISA Capital do Brasil, 8.80%, 1/30/17 (b)		250,000		257,500
Reliant Energy, 7.63%, 6/15/14		250,000		241,250
Teco Energy, 7.20%, 5/1/11		250,000		262,899
Texas Competitive Electric Holdings, 10.25%, 11/1/15 (b)		250,000		240,625
				1,961,483
Energy — 0.6%
Chesapeake Energy, 7.00%, 8/15/14		250,000		250,000
Tesoro, 6.63%, 11/1/15		250,000		247,500
				497,500
Industrials Other — 0.8%
Briggs & Stratton, 8.88%, 3/15/11		282,000		299,272
Chart Industries, 9.13%, 10/15/15		300,000		310,500
				609,772
Natural Gas — 1.6%
El Paso Energy, Series MTN, 7.80%, 8/1/31		100,000		99,898
SemGroup, 8.75%, 11/15/15 (b)		250,000		238,750
Southern Union, 7.20%, 11/1/66 (c)		200,000		200,216
Targa Resources, 8.50%, 11/1/13 (b)		250,000		245,000
Williams, 7.13%, 9/1/11		500,000		525,000
				1,308,864
Real Estate — 0.5%
Greentown China Holdings, 9.00%, 11/8/13 (b)		200,000		181,000
Shimao Property Holdings Limited, 8.00%, 12/1/16 (b)		250,000		222,500
				403,500
Sovereigns — 1.0%
Republic of Panama, 7.25%, 3/15/15		500,000		551,250
Republic of Uruguay, 8.00%, 11/18/22		250,000		281,250
				832,500
Technology — 0.7%
First Data, 9.88%, 9/24/15 (b)		150,000		139,500
Lucent Technologies, 6.45%, 3/15/29		250,000		201,250
NXP BV/NXP Funding, 9.50%, 10/15/15		250,000		227,500
				568,250
Transportation — 0.3%
Hertz, 8.88%, 1/1/14		250,000		250,000
Total High Yield Corporate Bonds
(cost: $20,194,627)				19,827,348
U.S. Government Agency Mortgage-Backed Securities — 37.3%
Adjustable Rate (c) — 0.8%
Federal Home Loan Mortgage Corporation, 6.96%, 9/1/18, #605911		174		175

2007 Quarterly Report 2 American Income Fund

Schedule ofINVESTMENTS(unaudited)

American Income Fund (continued)

Description of Security	Principal Amount		Market Value (a)
Federal National Mortgage Association,
6.80%, 7/1/27, #70179	$	1,796	$	1,792
6.549%, 10/1/32, #725110 (e)		341,202		348,304
Government National Mortgage Association, 6.13%, 12/20/22, #008096		289,065		293,133
				643,404
Fixed Rate — 36.5%
Federal Home Loan Mortgage Corporation, 6.50%, 8/1/30, #C43641		96,192		99,794
Federal Home Loan Mortgage Corporation Gold,
6.50%, 11/1/28, #C00676		280,508		291,011
5.50%, 10/1/33, #A15120 (e)		1,093,330		1,096,208
Federal National Mortgage Association,
4.00%, 11/1/10, #254956		1,570,925		1,542,827
6.00%, 12/1/13, #190179 (e)		298,504		303,939
7.50%, 5/1/15, #537440		29,299		30,494
7.00%, 6/1/17, #254384		212,769		221,606
7.00%, 7/1/17, #254414		281,541		293,234
6.00%, 9/1/17, #653368		224,994		230,464
5.00%, 11/1/18, #750989 (e)		493,488		494,777
5.00%, 2/1/19, #767182 (e)		797,542		799,626
5.00%, 2/1/21, #745279 (e)		791,049		791,012
5.50%, 4/1/21, #840466 (e)		1,265,429		1,280,450
6.00%, 5/1/29, #323702 (e)		487,859		499,072
6.50%, 5/1/31, #540814		101,870		105,359
7.00%, 9/1/31, #596680 (e)		373,630		387,138
7.00%, 3/1/32, #635970		187,827		197,226
6.50%, 6/1/32, #596712 (e)		537,401		552,176
5.50%, 6/1/33, #709700		736,943		740,039
5.50%, 11/1/33, #555967 (e)		1,753,623		1,760,990
6.00%, 11/1/34, #743642 (e)		499,704		509,208
5.50%, 12/1/33, #756202 (e)		1,071,136		1,075,636
6.00%, 1/1/34, #763687 (e)		858,436		873,914
5.50%, 1/1/34, #766070 (e)		896,563		899,561
6.00%, 3/1/34, #745324 (e)		1,021,916		1,043,576
6.00%, 1/1/35, #810225 (e)		733,043		746,261
6.50%, 10/1/08, #735273 (e)		947,583		979,694
5.50%, 3/1/35, #815979 (e)		1,527,659		1,531,172
5.00%, 7/1/35, #828346 (e)		1,993,164		1,955,398
5.50%, 3/1/36, #878059 (e)		1,381,989		1,384,572
6.00%, 6/1/36, #882685 (e)		3,524,211		3,582,458
5.00%, 6/1/37, #944244 (e)		1,493,239		1,463,535
Government National Mortgage Association,
6.50%, 4/15/33, #602233		342,422		356,089
5.50%, 8/15/33, #604567		1,132,846		1,149,964
6.00%, 7/15/34, #631574		556,634		571,416
				29,839,896
Total U.S. Government Agency Mortgage-Backed Securities
(cost: $30,218,983)				30,483,300

Collateralized Mortgage Obligation — Private Mortgage-Backed Securities — 39.8%
Adjustable Rate (c) — 11.8%
Banc of America Alternative Loan Trust, Series 2007-1, Class 2A2, 6.49%, 4/25/37	915,185	933,203
California Federal Bank Los Angeles, Series 1991-C12, Class A, 6.78%, 7/15/21 (d)	12,059	11,358
Goldman Sachs Mortgage Securities,
Series 2005-AR1, Class B1, 4.88%, 1/25/35	1,467,696	1,417,574
Series 2003-1, Class B2, 6.97%, 3/25/43	1,839,723	1,909,332
Series 2003-10, Class 1A1, 4.72%, 10/25/33	1,282,764	1,253,809
IndyMac Index Mortgage Loan Trust, Series 2006-AR13, Class A3, 6.11%, 7/25/36	1,500,000	1,534,220
JP Morgan Mortgage Trust, Series 2006-A7, Class 3A4, 5.95%, 1/25/37	884,061	876,142
Washington Mutual Mortgage Pass-Through Certificates, Series 2007-HY2, Class 3A2, 5.94%, 9/25/36	898,663	895,181
Washington Mutual MCS Mortgage, Series 2003-AR3, Class B1, 5.24%, 6/25/33	673,084	691,859

2007 Quarterly Report 3 American Income Fund

Schedule ofINVESTMENTS(unaudited)

American Income Fund (continued)

Description of Security	Principal Amount		Market Value (a)
Wells Fargo Mortgage-Backed Securities Trust, Series 2003-D, Class A1, 4.79%, 2/25/33	$	160,749	$	160,087
				9,682,765
Fixed Rate — 28.0%
Banc of America Funding, Series 2007-4, Class 1A2, 5.50%, 6/25/37		991,526		982,172
Citicorp Mortgage Securities, Series 2004-5, Class B3, 5.28%, 8/25/34		1,166,063		920,264
Credit Suisse First Boston Mortgage Securities Corporation,
Series 2003-8, Class DB1, 6.25%, 4/25/33		1,452,993		1,468,854
Series 2005-11, Class 6A7, 6.00%, 12/25/35		1,000,000		935,233
Series 2005-12, Class DB4, 5.84%, 1/25/36		822,678		371,673
Countrywide Alternative Loan Trust,
Series 2004-28CB, Class 2A1, 5.00%, 1/25/35		501,708		494,755
Series 2005-7CB, Class 2A4, 5.50%, 4/25/35		750,000		754,303
First Horizon Alternative Mortgage Securities, Series 2005-FA5, 5.50%, Class 3A2, 8/25/35		1,278,032		1,234,253
GMAC Mortgage Corporation Loan Trust,
Series 2003-J9, Class A15, 5.00%, 1/25/34		1,325,000		1,300,889
Series 2004-J5, Class A7, 6.50%, 1/25/35		854,694		853,359
Goldman Sachs Mortgage Securities,
Series 2001-2, Class A, 7.50%, 6/19/32 (b)		289,954		307,267
Series 2005-4F, Class B1, 5.73%, 5/25/35		1,247,614		1,102,645
JP Morgan Alternative Loan Trust, Series 2006-SI, Class 1A19, 6.50%, 3/25/36		1,080,729		1,054,897
Morgan Stanley Mortgage Loan Trust, Series 2004-9, Class 1A, 6.15%, 10/25/34		1,143,310		1,162,247
Nomura Asset Acceptance Corporation, Series 2004-R2, Class B1, 6.74%, 10/25/34 (b)		1,077,855		1,125,894
Prime Mortgage Trust,
Series 2004-2, Class B2, 5.04%, 11/25/19		364,949		337,165
Series 2004-2, Class B3, 5.04%, 11/25/19		273,500		241,080
Residential Accredit Loans, Series 2003-QS12, Class M1, 5.00%, 6/25/18		890,169		839,039
Residential Asset Mortgage Products,
Series 2003-SL1, Class M2, 7.32%, 4/25/31		1,002,144		946,335
Series 2004-SL4, Class A3, 6.50%, 7/25/32		911,725		947,456
Washington Mutual MSC Mortgage, Series 2003-MS9, Class CB2, 7.46%, 4/25/33		379,701		336,708
Washington Mutual Mortgage, Series 2004-RA3, Class 2A, 6.38%, 8/25/38		448,585		457,977
Wells Fargo Mortgage-Backed Securities Trust,
Series 2003-7, Class A3, 4.50%, 8/25/18		618,487		615,986
Series 2004-7, Class 2A2, 5.00%, 7/25/19		683,724		680,519
Series 2004-7, Class B2, 4.72%, 7/25/19		612,987		561,435
Series 2004-7, Class B3, 4.72%, 7/25/19		459,947		402,378
Series 2005-3, Class A9, 5.50%, 5/25/35		1,690,727		1,348,445
Series 2007-9, Class 1A4, 5.50%, 7/25/37		1,240,000		1,102,245
				22,885,473
Total Collateralized Mortgage Obligation — Private Mortgage-Backed Securities
(cost: $33,365,703)				32,568,238
Collateralized Mortgage Obligation — U.S. Agency Mortgage-Backed Securities — 12.7%
Fixed Rate — 8.2%
Federal Home Loan Mortgage Corporation,
Series 2690, Class OE, 5.00%, 11/15/28		1,274,000		1,278,548
Series 2972, Class KA, 4.50%, 6/15/18		741,532		733,654
Series 3294, Class DB, 4.50%, 3/15/22		1,000,000		964,206
Federal National Mortgage Association,
Series 2004-27, Class HB, 4.00%, 5/25/19 (e)		1,923,137		1,795,484
Series 2004-29, Class WG, 4.50%, 5/25/19		942,115		908,277
Series 2004-90, Class GA, 4.35%, 3/25/34		683,126		672,860
Series 2002-WI, Class 2A, 7.50%, 2/25/42		374,815		396,512
				6,749,541
Z-Bonds (f) — 4.5%
Federal Home Loan Mortgage Corporation, Series 2676, Class GZ, 4.50%, 9/15/33 (e)		1,828,250		1,574,946

2007 Quarterly Report 4 American Income Fund

Schedule ofINVESTMENTS(unaudited)

American Income Fund (continued)

Description of Security	Principal Amount		Market Value (a)
Government National Mortgage Association, Series 2001-8, Class Z, 6.50%, 3/20/31	$	2,039,907	$	2,105,809
				3,680,755
Total Collateralized Mortgage Obligation — U.S. Agency Mortgage-Backed Securities
(cost: $9,960,158)				10,430,296
Asset-Backed Securities — 10.2%
Commercial — 2.0%
Bear Stearns Commercial Mortgage Securities, Series 2007-T28, Class D, 6.18%, 9/11/42 (b) (c)		475,000		384,566
JP Morgan Chase Commercial Mortgage Securities, Series 2005-LDP5, Class B, 5.50%, 12/15/44 (c)		425,000		406,447
Merrill Lynch Mortgage Trust, Series 2005-CIP1, Class C, 5.30%, 7/12/38		500,000		471,140
Morgan Stanley Capital I, Series 2005-HQ6, Class B, 5.15%, 8/13/42		445,000		419,024
				1,681,177
Credit Cards — 2.1%
American Express Issuance Trust, Series 2005-1, Class C, 4.98%, 8/15/11 (c)		435,000		420,134
Discover Card Master Trust, Series 2007-C1, Class C1, 4.97%, 1/15/13 (c)		370,000		357,432
Washington Mutual Master Note Trust, Series 2007-C1, Class C1, 6.01%, 5/15/14 (b) (c)		1,000,000		960,313
				1,737,879
Home Equity — 3.6%
Residential Funding Mortgage Securities II,
Series 2004-HI2, Class A4, 5.24%, 9/25/18		725,301		721,370
Series 2003-HI4, Class M1, 5.53%, 2/25/29 (g)		2,327,000		2,228,092
				2,949,462
Manufactured Housing — 1.3%
Green Tree Financial, Series 1994-2, Class A5, 8.30%, 5/15/19		263,631		263,919
Origen Manufactured Housing, Series 2005-B, Class M1, 5.99%, 1/15/37		750,000		774,984
				1,038,903
Other — 1.2%
Crown Castle Towers LLC, Series 2005-1A, Class D, 5.61%, 6/15/35 (b)		1,000,000		978,280
Total Asset-Backed Securities
(cost: $8,579,680)				8,385,701
Investment Grade Corporate Bonds — 3.1%
Basic Industry — 0.9%
Southern Copper, 7.50%, 7/27/35		400,000		428,464

2007 Quarterly Report 5 American Income Fund

Schedule ofINVESTMENTS(unaudited)

American Income Fund (continued)

Description of Security	Principal Amount/ Shares		Market Value (a)
Vale Overseas, 6.25%, 1/11/16	$	250,000	$	253,497
				681,961
Communications — 0.5%
Qwest, 8.88%, 3/15/12		400,000		429,500
Consumer Non Cyclical — 0.6%
Fisher Scientific International, 6.75%, 8/15/14		500,000		514,766
Energy — 0.2%
TNK-BP Finance, 6.63%, 3/20/17 (b)		200,000		182,660
Finance — 0.3%
Capital One Financial, 6.75%, 9/15/17		200,000		195,557
Transportation — 0.6%
American Airlines, Series 99-1, 7.02%, 10/15/09		500,000		501,875
Total Investment Grade Corporate Bonds
(cost: $2,475,277)				2,506,319
Municipal Bond — 0.9%
Sullivan County, Tennessee, Health, Educational, and Housing Facilities Board, Hospital Revenue, Welmont Health System, 6.95%, 9/1/16
(cost: $695,000)		695,000		712,674
Preferred Stocks — 0.7%
Financials — 0.1%
Indymac Bank FSB (b)		5,000		67,813
Real Estate Investment Trusts — 0.4%
Ashford Hospitality Trust, Series D		5,000		105,500
iStar Financial, Series G		1,000		20,050
National Retail Properties, Series C		4,000		87,600
Northstar Realty Finance,
Series A		4,000		72,000
Series B		4,000		69,600
				354,750
Wireless Communication — 0.2%
United States Cellular		6,000		137,280
Total Preferred Stocks
(cost: $722,800)				559,843
Convertible Security — 0.1%
Basic Industry — 0.1%
Coeur D’Alene Mines, 1.25%, 1/15/24
(cost: $99,031)	$	100,000		89,375
Short-Term Investments — 1.8%
Money Market Fund (h) — 1.6%
First American Prime Obligations Fund, Class Z		1,296,655		1,296,655
U.S. Treasury Obligation (i) — 0.2%
U.S. Treasury Bill, 4.05%, 12/20/07	$	140,000		139,723
Total Short-Term Investments
(cost: $1,436,378)				1,436,378

2007 Quarterly Report 6 American Income Fund

Schedule ofINVESTMENTS(unaudited)

American Income Fund (continued)

	Market Value (a)
Total Investments in Securities (j) — 130.8%
(cost: $107,747,637)	$	106,999,472
Other Assets and Liabilities — (30.8)%		(25,166,840	)
Total Net Assets — 100.0%	$	81,832,632

Notes to Schedule of Investments:

(a) Debt obligations exceeding 60 days to maturity are valued by an independent pricing service that has been approved by the fund’s board of directors. The pricing service may employ methodologies that utilize actual market transactions, broker-dealer supplied valuations, or other formula-driven valuation techniques. These techniques generally consider such factors as yields or prices of bonds of comparable quality, type of issue, coupon, maturity, ratings, and general market conditions. Securities for which prices are not available from an independent pricing service but where an active market exists are valued using market quotations obtained from one or more dealers that make markets in the securities or from a widely-used quotation system. When market quotations are not readily available, securities are valued at fair value as determined in good faith by procedures established and approved by the fund’s board of directors. Some of the factors which may be considered in determining fair value are fundamental analytical data relating to the investment; the nature and duration of any restrictions on disposition; trading in similar securities of the same issuer or comparable companies; information from broker-dealers; and an evaluation of the forces that influence the market in which the security is purchased or sold. If events occur that materially affect the value of securities (including non-U.S. securities) between the close of trading in those securities and the close of regular trading on the New York Stock Exchange, the securities will be valued at fair value. Debt obligations with 60 days or less remaining until maturity may be valued at their amortized cost, which approximates market value. Exchange listed futures and options on futures are priced at their last sale price on the exchange on which they are principally traded, as determined by FAF Advisors, Inc., on the day the valuation is made. If there were no sales on that day, futures and options on futures will be valued at the last reported bid price. Swaps are valued at the quotations received from an independent pricing service. Security valuations are performed once a week and at the end of each month.   As of November 30, 2007, the fund held a fair valued security with a value of $11,358, or 0.01% of total net assets.

(b)	Securities sold within terms of a private placement memorandum, exempt from registration under Rule 144A of the Securities Act of 1933, as amended, which may be sold only to dealers in that program or other "qualified institutional buyers". These securities have been determined to be liquid under guidelines established by the fund's board of directors. As of November 30, 2007, the value of these investments was $8,730,814 or 10.7% of total net assets.
(c)	Variable Rate Security - The rate shown is in effect as of November 30, 2007.
(d)	Security is fair valued and illiquid. As of November 30, 2007, the value of this investment was $11,358 or 0.01% of total net assets.
(e)	On November 30, 2007, securities valued at $27,729,107 were pledged as collateral for the following outstanding reverse repurchase agreements.

Amount		Acquisition Date		Rate*			Due		Accrued Interest		Name of Broker and Description of Collateral
$	12,373,000		11/16/07		5.00	%		12/17/07	$	25,777		(1)
	13,936,000		11/23/07		4.90	%		12/24/07		15,175		(1)
$	26,309,000								$	40,952

* Interest rate as of November 30, 2007. Rates are based on the London InterBank Offered Rate (LIBOR) and reset monthly.

2007 Quarterly Report 7 American Income Fund

Schedule ofINVESTMENTS(unaudited)

American Income Fund (concluded)

Name of broker and description of collateral:
(1)	Goldman Sachs:
	Federal Home Loan Mortgage Corporation Gold, 5.50%, 10/1/33, $1,093,330 par
	Federal Home Loan Mortgage Corporation, 4.50%, 9/15/33, $1,828,250 par
	Federal National Mortgage Association, 6.00%, 12/1/13, $298,504 par
	Federal National Mortgage Association, 5.00%, 11/1/18, $493,488 par
	Federal National Mortgage Association, 5.00%, 2/1/19, $797,542 par
	Federal National Mortgage Association, 4.00%, 5/25/19, $1,923,137 par
	Federal National Mortgage Association, 5.00%, 2/1/21, $791,049 par
	Federal National Mortgage Association, 5.50%, 4/1/21, $1,265,429 par
	Federal National Mortgage Association, 6.00%, 5/1/29, $487,859 par
	Federal National Mortgage Association, 7.00%, 9/1/31, $373,630 par
	Federal National Mortgage Association, 6.50%, 6/1/32, $537,401 par
	Federal National Mortgage Association, 7.12%, 10/1/32, $341,202 par
	Federal National Mortgage Association, 5.50%, 11/1/33, $1,753,623 par
	Federal National Mortgage Association, 6.00%, 11/1/33, $499,704 par
	Federal National Mortgage Association, 5.50%, 12/1/33, $1,071,136 par
	Federal National Mortgage Association, 6.00%, 1/1/34, $858,436 par
	Federal National Mortgage Association, 5.50%, 2/1/34, $896,563 par
	Federal National Mortgage Association, 6.00%, 3/1/34, $1,021,916 par
	Federal National Mortgage Association, 6.00%, 1/1/35, $733,043 par
	Federal National Mortgage Association, 6.50%, 2/1/35, $947,583 par
	Federal National Mortgage Association, 5.50%, 3/1/35, $1,527,659 par
	Federal National Mortgage Association, 5.00%, 7/1/35, $1,993,164 par
	Federal National Mortgage Association, 5.50%, 3/1/36, $1,381,989 par
	Federal National Mortgage Association, 6.00%, 6/1/36, $3,524,211 par
	Federal National Mortgage Association, 5.00%, 6/1/37, $1,493,239 par
(f)	Z-Bond - Represents securities that pay no interest or principal during their accrual periods, but accrue additional principal at specified rates. Interest rate shown represents the current yield based upon the current cost basis and estimated future cash flows.
(g)	Delayed interest (Step Bonds) - Securities for which the coupon rate of interest will adjust on specified future date(s).
(h)	Investment in affiliated security. This money market fund is advised by FAF Advisors, Inc., which also serves as advisor for the fund.
(i)	Security has been deposited as initial margin on open futures contracts and swap agreements. Yield shown is effective yield as of November 30, 2007.
(j)	On November 30, 2007, the cost of investments in securities was $107,747,637. The aggregate gross unrealized appreciation and depreciation of investments in securities, based on this cost, were as follows:

Gross unrealized appreciation	$	1,604,195
Gross unrealized depreciation		(2,352,360	)
Net unrealized depreciation	$	(748,165	)

Schedule of Open Futures Contracts

Description	Number of Contracts Sold		Notional Contract Value			Settlement Month		Unrealized Depreciation
U.S. Treasury 5 Year Note Futures		88	$	(9,689,627	)		March 2008	$	(19,450	)
U.S. Treasury 10 Year Note Futures		42		(4,754,530	)		March 2008		(2,350	)
U.S. Treasury Long Bond Futures		20		(2,343,750	)		March 2008		(21,828	)
								$	(43,628	)

Credit Default Swap Agreements

Counterparty	Reference Entity		Buy/Sell Protection		Pay/Receive Fixed Rate			Expiration Date		Notional Amount		Unrealized Appreciation
Deutsche Bank		Dow Jones CDX HVOL9		Buy		1.40	%		12/20/12	$	2,800,000	$	1,467
UBS		Dow Jones CDX EM8		Buy		1.75	%		12/20/12		2,000,000		31,557
UBS		Republic of Turkey		Buy		1.48	%		7/20/12		300,000		2,502
												$	35,526

2007 Quarterly Report 8 American Income Fund

Item 2—Controls and Procedures

(a) The registrant’s Principal Executive Officer and Principal Financial Officer have evaluated the registrant’s disclosure controls and procedures within 90 days of the date of this filing and have concluded that the registrant’s disclosure controls and procedures were effective, as of that date, in ensuring that information required to be disclosed by the registrant in this Form N-Q was recorded, processed, summarized and reported timely.

(b) There were no changes in the registrant’s internal control over financial reporting that occurred during the last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.

Item 3 - Exhibits

Certifications of the Principal Executive Officer and Principal Financial Officer of the registrant as required by Rule 30a-2(a) under the Investment Company Act are filed as exhibits hereto.

Signatures

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

American Income Fund, Inc.

By:  /s/ Thomas S. Schreier, Jr.

Thomas S. Schreier, Jr.

President

Date: January 17, 2008

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

By:  /s/ Thomas S. Schreier, Jr.

Thomas S. Schreier, Jr.

President

Date: January 17, 2008

By:  /s/ Charles D. Gariboldi, Jr.

Charles D. Gariboldi, Jr.

Treasurer

Date: January 17, 2008