SALOMON BROTHERS INSTITUTIONAL INVESTMENT SERIES
                              7 WORLD TRADE CENTER
                            NEW YORK, NEW YORK 10048
                                 (800) SALOMON
                                 (800) 725-6666
 
                       SUPPLEMENT DATED OCTOBER 10, 1997
                                 TO PROSPECTUS
                              DATED APRIL 29, 1997
 
The following information supplements and should be read in conjunction with the
section of the current Prospectus of Salomon Brothers Institutional Investment
Series (the 'Series') entitled 'Management:'
 
     'On September 24, 1997, Travelers Group ('Travelers') and Salomon Inc
     ('Salomon'), the ultimate parent company of Salomon Brothers Asset
     Management Inc ('SBAM') and Salomon Brothers Asset Management Asia Pacific
     Limited ('SBAM AP'), announced their agreement to merge Salomon with and
     into Smith Barney Holdings Inc., a subsidiary of Travelers, to form a new
     company expected to be called Salomon Smith Barney Holdings Inc. (the
     'Transaction'). Travelers is a diversified financial services company
     engaged in investment services, asset management, consumer finance and
     life and property casualty insurance services.
 
     The Transaction is expected to be completed by the end of
     November 1997, subject to a number of conditions,
     including the receipt of U.S. and foreign
     regulatory approvals and the approval of Salomon stockholders. Upon
     consummation of the Transaction, Travelers will become the ultimate parent
     of SBAM and SBAM AP, which will continue to serve as the investment adviser
     and sub-adviser, respectively, to the Series.'
 
                            -----------------------------
 
     Effective June 1, 1997, First Data Investor Services Group, Inc. ('FDISG')
     replaced Investors Bank & Trust Company ('IBT') as the transfer agent for
     the funds comprising the Series. Accordingly, the following supplements the
     information contained in the Series' current Prospectus dated April 29,
     1997.
 
     The second paragraph under the section entitled 'Purchase and Redemption of
     Shares -- Purchase Procedures' is hereby replaced with the following
     paragraph:
 
     'Shares may be purchased by completing a Purchase Application and mailing
     it, together with your check payable to Salomon Brothers Funds, to:
 
          (Name of Fund)
          c/o FDISG
          P.O. Box 5127
          Westborough, MA 01581-5127'
 
The fifth paragraph under this section is hereby replaced with the following
paragraph:
 
     'Initial and subsequent investments may also be made by wire transfer. The
     investor should instruct the wiring bank to transmit the specified amount
     in federal funds to:
 
          Boston Safe Deposit and Trust Company
          Boston, MA
          ABA No. 011-001-234
          Account #142743
          Attn: (Name of Fund)
          Name of Account:
          Account # (As assigned):'



 

The back cover of the Prospectus is amended by removing the reference 'IBT' as
transfer agent and dividend disbursing agent and inserting the following:
 
     'TRANSFER AGENT AND DIVIDEND DISBURSING AGENT
     First Data Investor Services Group, Inc.
     P.O. Box 5127
     Westborough, Massachusetts 01581-5127'
 
In addition, all references in the Prospectus to 'IBT' as transfer agent should
now be read as 'FDISG.'






 


                SALOMON BROTHERS INSTITUTIONAL INVESTMENT SERIES
                              7 WORLD TRADE CENTER
                            NEW YORK, NEW YORK 10048
                                  (800) SALOMON
                                  (800) 725-6666

                       SUPPLEMENT DATED OCTOBER 10, 1997
                    TO STATEMENT OF ADDITIONAL INFORMATION
                              DATED APRIL 29, 1997
 
The following information supplements and should be read in conjunction with the
section of the current Statement of Additional Information of Salomon Brothers
Institutional Investment Series (the 'Series') entitled 'Investment Manager:'
 
     'On September 24, 1997, Travelers Group ('Travelers') and Salomon Inc
     ('Salomon'), the ultimate parent company of Salomon Brothers Asset
     Management Inc ('SBAM') and Salomon Brothers Asset Management Asia Pacific
     Limited ('SBAM AP'), announced their agreement to merge Salomon with and
     into Smith Barney Holdings Inc., a subsidiary of Travelers, to form a new
     company expected to be called Salomon Smith Barney Holdings Inc. (the
     'Transaction'). Travelers is a diversified financial services company
     engaged in investment services, asset management, consumer finance and
     life and property casualty insurance services.
 
     The Transaction is expected to be completed by the end of
     November 1997, subject to a number of conditions, including
     the receipt of U.S. and foreign regulatory approvals and
     the approval of Salomon stockholders. Upon consummation of
     the Transaction, Travelers will become the ultimate parent
     of SBAM and SBAM AP, which will continue to serve as the investment adviser
     and sub-adviser, respectively, to the Series.'


                            -----------------------------
Effective June 1, 1997, First Data Investor Services Group, Inc. ('FDISG')
replaced Investors Bank & Trust Company ('IBT') as the transfer agent for
the funds comprising the Series. Accordingly, all references in the Statement
of Additional Information to IBT as transfer agent should now be read as FDISG.