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GODFREY & KAHN, S.C. MILWAUKEE APPLETON GREEN BAY WAUKESHA
LAFOLLETTE GODFREY & KAHN MADISON

December 16, 2004

VIA EDGAR AND FEDERAL EXPRESS

Mr. Keith O’Connell

U.S. Securities and Exchange Commission

Judiciary Plaza

450 Fifth Street, N.W.

Washington D.C. 20549

RE:

Marshall Funds, Inc.

(Registration Nos. 033-48907; 811-58433)

Dear Mr. O’Connell:

The purpose of this letter is to respond to oral comments received from you on Monday, December 13, 2004 regarding Post-Effective Amendment No. 41 to the Registration Statement on Form N-1A (the “Registration Statement”) of Marshall Funds, Inc. (the “Company”).  Assuming the responses set forth below are satisfactory, we intend to file a post-effective amendment to the Registration Statement under Rule 485(b) prior to December 31, 2004, which would incorporate our responses set forth below and other miscellaneous, non-material changes.

The Company understands that:  (1) it is responsible for the adequacy and accuracy of the disclosure in its filings, (2) the staff comments or changes to disclosure in response to staff comments in the filings reviewed by the staff do not foreclose the Commission from taking any action with respect to the filings, and (3) it may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.

Your comments and our responses are set forth below.  Capitalized terms used in this response letter but not defined herein shall have the same meaning as in the Registration Statement.

Prospectuses

1.

Comment:  The shareholder servicing fee that is currently stated as a separate line item in the fees and expenses tables should be included with either (1) 12b-1 fees or (2) other expenses but not as a separate line item.  The Company may revise the “Other Expenses” footnote to note that shareholder servicing fees are included.  

Response:  The shareholder servicing fee is not paid out of 12b-1 fees.  Accordingly, the fee has been added to “Other Expenses” and the footnote has been revised accordingly.

2.

Comment:  With respect to the discussion of fair value pricing, the Company should disclose whether certain Funds may be more likely to be fair valued due to the types of investments that they make.

Response:  The International Fund is the only Fund that is more likely to be fair valued.  Appropriate fair value disclosure has been included in the Prospectuses with respect to this Fund.

3.

Comment:  When does the Money Market Fund declare dividends?  Considering that the Money Market Fund calculates its NAV three times a day, the Company needs to clarify when dividends are declared and make that information prominent.

Response:  All of the Prospectuses that include the money market funds disclose when and how dividends are declared and paid.  See the section entitled “Account and Share Information - Dividends and Capital Gains.”  The disclosure states that dividends are declared daily and paid monthly with respect to all of the money market funds and that they are declared subsequent to the issuance of shares until the day shares are redeemed.  We have revised that disclosure to clarify that a shareholder would not receive a dividend on the day on which he redeems or exchanges his shares.

4.

Comment:  The following must be revised because it suggests that all shareholders may not receive the next determined NAV:  “For purchase orders for the Money Market Fund in excess of $1 million received after 3:00 p.m. (Central Time) but before 4:00 p.m. (Central Time), MIS will use its best efforts to process such purchase orders that day.  However, there is no guarantee that MIS will be able to process such purchase orders that day.”  

Response:  The disclosure has been revised to clarify that all shareholders will receive the next determined NAV after the order is received in proper form, regardless of when the order is processed.

5.

Comment:  Similarly, the following statements need to be revised to clarify that all orders that are received in good order will receive the next determined NAV:

(1) “Any delay in processing your order will affect the purchase price you receive for your shares”; and

(2) “To the extent your order is processed on the day received in accordance with these timeframes, you will receive that day’s NAV and dividend.”

Response:  We have revised these statements as suggested.  

6.

Comment:  Why is the discussion of signature guarantees found in the Class A/Y Prospectus not included in the Class I Prospectus?

Response:  Signature guarantees are not required with respect to Class I shares.

7.

Comment:  Under the section entitled “Exchanges by Telephone,” it is stated that a shareholder will not receive a dividend of the Fund into which he exchanges on the day of the exchange.  Would the shareholder receive a dividend of the Fund from which he is getting out of?

Response:  No, the shareholder would not receive a dividend of the Fund being exchanged out of.  We have revised the disclosure to indicate that a shareholder would receive any dividend paid with respect to the Fund into which he exchanges.  

8.

Comment:  With respect to the following sentence, are the contracts entered into with omnibus accounts and plans or with the shareholders:  “The redemption/exchange fee is waived for shares purchased through omnibus accounts or by qualified employee benefit plans, unless otherwise provided by contract.”  To the extent contracts are entered into with such omnibus accounts and plans, the latter part of that sentence should read something like “unless otherwise provided for by contract with such accounts or plans.”

Response:  The contracts may be entered into with omnibus accounts or plans.  The sentence has been revised as suggested.  

9.

Comment:  With respect to the frequent trading/market timing policy, new form requirements require that a fund describe exceptions to restrictions under the policy with specificity.  The new rules are designed to prevent a fund from having broad discretion in determining exceptions.  Thus, the following sentence must be revised to be more specific:  “In addition, the Funds’ management or the Adviser may, in their sole discretion, waive the short-term redemption fee for accounts of shareholders who do not engage in excessive trading that is determined to be detrimental to a Fund and its shareholders.”  

Response:  Done.

10.

Comment:  The following sentence is included in the Class Y and Class I (International Stock Fund) Prospectuses discussion of the frequent trading/market timing policy and should probably be included in the Class A/Y Prospectus:  “Any such waivers will be reported to the Board.”

Response:  Correct.  The sentence has been added in the Class A/Y Prospectus.

11.

Comment:  With respect to the definition of Lipper indices, the SEC believes that they do reflect the deduction of fees and expenses, but they might not include sales charges.  Consequently, the definitions of Lipper indices used in the Prospectuses which state that these indices do not reflect the deduction of fees and expenses should be revised accordingly.

Response:  Done.

12.

Comment:  The information regarding “Total Actual Annual Fund Operating Expenses (after waivers)” in the fees and expenses table should be in a smaller font size because it is intended as a footnote rather than a separate line item in the table.

Response:  Done.

13.

Comment:  With respect to funds that have a non-fundamental policy to provide 60-days notice under Rule 35d-1, the SEC has been asking the funds to disclose that they have the right to change the policy in their prospectuses.  The Prospectuses should include this same disclosure where relevant.

Response:  Done.

SAIs

14.

Comment:  The use of * in the director compensation table with an accompanying footnote stating that total compensation paid to directors is allocated to each Fund according to such Fund’s asset size does not comply with the form requirements.  Need to either (1) specify the compensation paid by each Fund or (2) provide an analysis to the staff as to why it does comply with the form.  

Response:  We have revised the table to indicate how much each director was paid by each Fund for the fiscal year ended August 31, 2004.  

15.

Comment:  With respect to the Portfolio Holdings Disclosure Policy discussion, the disclosure does not address two items that are required by Item 11:

(1)

discussion of any restrictions on the use of portfolio holdings information after its release, such as confidentiality agreements, any prohibitions on trading based on such information and procedures to monitor the use of such information; and

(2)

disclosure of the policies of the adviser and any other third parties that affect the Funds with respect to disclosure of their portfolio holdings pursuant to one of the instructions to Item 11.  

Response:  We have added disclosure to address item (1) above.  Also, with respect to item (2) above, we have clarified that the Fund’s policies also apply to the Adviser and M&I Trust.

16.

Comment:  Generally, the SEC asks funds that discuss duration in their SAIs to give an example.  The Company should do the same with respect to its SAIs.

Response:  Done.

17.

Comment:  Confirm that there were no changes to the Money Market Fund’s fundamental investment policy regarding concentration without shareholder approval.

Response:  Confirmed.  

18.

Comment:  Some topics are not discussed with respect to certain Funds.  For example, the Class I (Money Market Funds) Prospectus does not discuss exchanges by telephone.  Do the Funds differ in terms of such privileges?

Response:  Yes, some of the privileges and procedures differ based on Class and Fund.

*   *   *   *   *   *

Please call me at your earliest convenience at (414) 287-9653 to clear these changes.  

Very truly yours,

GODFREY & KAHN, S.C.

/s/ Jasna B. Dolgov

Jasna B. Dolgov

cc:

John M. Blaser

Carol A. Gehl

Ellen Drought

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