UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED
MANAGEMENT INVESTMENT COMPANY

Investment Company Act file number: 811-07738

Montana Tax-Free Fund, Inc.
(Exact name of registrant as specified in charter)

1 Main Street North, Minot, North Dakota 58703
(Address of principal executive offices) (Zip code)

Brent Wheeler, 1 Main Street North, Minot, North Dakota 58703
(Name and address of agent for service)

Registrant's telephone number, including area code: 701-852-5292

Date of fiscal year end: December 31

Date of reporting period: March 31, 2008

Form N-Q is to be used by management investment companies, other than small business investment companies registered on Form N-5 (§§ 239.24 and 274.5 of this chapter), to file reports with the Commission, not later than 60 days after the close of the first and third fiscal quarters, pursuant to rule 30b1-5 under the Investment Company Act of 1940 (17 CFR 270.30b1-5). The Commission may use the information provided on Form N-Q in its regulatory, disclosure review, inspection, and policymaking roles.

A registrant is required to disclose the information specified by Form N-Q, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-Q unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to the Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.

Item 1. Schedule of Investments

MONTANA TAX-FREE FUND, INC.
Schedule of Investments March 31, 2008 (Unaudited)
Name of Issuer
Percentages represent the market value of each investment category to total net assets	Rating Moody's/S&P		Coupon Rate	Maturity		Principal Amount		Market Value
MONTANA MUNICIPAL BONDS (97.0%)
#Billings, MT (West Park Village) Multifamily Hsg. Devl. Ref. Rev. GNMA	Aaa/NR		5.550%	12/01/2032	$	2,500,000	$	2,472,225
#Forsyth, MT PCR Ref. Northwestern Corp. Colstrip AMBAC	Aaa/AAA		4.650	08/01/2023		650,000		608,127
MT Fin. Auth. Hlth. Care Rev. Master Loan Proj.--Cmnty. Med. Ctr.	Aa-3/NR		5.100	12/01/2018		250,000		257,960
MT Fin. Auth. Hlth. Care Rev. Master Loan Proj.--Cmnty. Med. Ctr.	Aa-3/NR		5.125	12/01/2019		250,000		257,135
MT Fin. Auth. Hlth. Care Rev. Master Loan Proj.--Cmnty. Med. Ctr.	Aa-3/NR		5.150	12/01/2020		250,000		254,842
MT Fin. Auth. Hlth. Care Rev. Master Loan Proj.--Cmnty. Med. Ctr.	Aa-3/NR		5.200	12/01/2021		250,000		253,755
MT Fac. Fin. Auth. (St. Luke Health)	Aa-3/NR		4.500	01/01/2017		120,000		121,309
MT Fac. Fin. Auth. (St. Luke Health)	Aa-3/NR		5.000	01/01/2022		500,000		507,655
MT Facs. Fin. Auth. (St. Peters Hospital)	A-3/NR		5.000	06/01/2028		250,000		238,278
*MT Fin. Auth. Rev. (Providence Health)	Aa/AA		5.000	10/01/2022		1,500,000		1,527,000
MT Fac. Fin. Auth. Series A (Cmty, Counseling & Correctional Svcs.) CIFG	A-1/A+		4.500	10/01/2022		470,000		452,051
MT Fac. Fin. Auth. Series B (Boyd Andrew Prj.) CIFG	A-1/A+		4.500	10/01/2022		215,000		206,789
MT Fac. Fin. Auth. (Benefits Healthcare) Assured GTY	NR/AAA		4.750	01/01/2025		150,000		147,813
MT State (Water Pollution Control) Revolving Fund Program G.O.	Aa/AA-		5.600	07/15/2020		170,000		179,343
MT State (Water Pollution Control) Revolving Fund Program G.O.	Aa/AA-		5.600	07/15/2020		240,000		253,190
MT Board of Hsg. Multifamily Mrtge. FHA	Aa/NR		6.150	08/01/2026		200,000		201,886
*MT State Board of Regents Higher Educ. (MT St. Univ.) Rev. Ref. AMBAC	Aaa/AAA		5.000	11/15/2021		750,000		786,600
MT State Board of Regents (University of MT) MBIA	Aaa/AAA		6.000	05/15/2019		230,000		247,731
MT State Board of Regents (University of MT) MBIA	Aaa/AAA		5.750	05/15/2024		275,000		290,197
MT State Board of Regents Higher Educ. (MT. St. Univ.) Fac. Rev. AMBAC	Aaa/AAA		4.500	11/15/2025		770,000		744,474
MT Hlth. Facs. Auth. (State Hospital) Hlth. Care Rev. AMBAC	Aaa/NR		5.000	06/01/2022		600,000		610,170
MT Hlth. Facs. Auth. (Big Horn Hosp.--Hardin) Rev.	A/NR		5.100	02/01/2018		300,000		300,000
MT Hlth. Facs. Auth. (Lewis & Clark Nursing Home) Rev.	A/NR		5.100	02/01/2018		350,000		350,000
MT Hlth. Facs. Auth. (Lewis & Clark Office Proj.) Rev.	A/NR		5.100	02/01/2018		150,000		150,000
*MT Hlth. Facs. Auth. (Marcus Daly Memorial) Rev.	A/NR		6.000	08/01/2020		1,400,000		1,446,382
*MT Hgr. Educ. Student Assistance Corp. Rev.	A/NR		5.500	12/01/2031		1,935,000		1,923,003
#MT Hgr. Educ. Student Assistance Corp. Rev.	A/NR		6.400	12/01/2032		1,250,000		1,289,725
#MT Hlth. Facs. Auth. (Bozeman Deaconess) Rev. Ref.	NR/A+		5.000	06/01/2018		1,000,000		1,018,860
MT Hlth. Facs. Auth. (Alternatives Inc.) Prerelease Ctr. Rev.	NR/A-		5.600	10/01/2017		750,000		750,000
#MT Hlth. Facs. Auth. (Boyd Andrew Prj.) Pre Release Center	NR/A-		6.300	10/01/2020		795,000		837,024
TOTAL MONTANA MUNICPAL BONDS (COST: $18,623,420)							$	18,683,524
SHORT-TERM SECURITIES (2.3%)						Shares
Wells Fargo Advantage National Tax-Free Money Market (COST: $443,042)						443,042	$	443,042
TOTAL INVESTMENTS IN SECURITIES (COST: $19,066,462)							$	19,126,566
OTHER ASSETS LESS LIABILITIES								125,345
NET ASSETS							$	19,251,911
* Indicates bonds are segregated by the custodian to cover when-issued or delayed-delivery purchases.
# Indicates bonds are segregated by the custodian to cover initial margin requirements.
Non-rated (NR) securities have been determined to be of investment grade quality by the Fund's Manager.
Note: INVESTMENT IN SECURITIES
At March 31, 2008, the aggregate cost of securities for federal income tax purposes was substantially the same for financial reporting purposes at $19,066,462. The net unrealized appreciation of investments based on the cost was $60,104, which is comprised of $241,191 aggregate gross unrealized appreciation and $181,087 aggregate gross unrealized depreciation. Differences between financial reporting-basis and tax-basis unrealized appreciation/depreciation are due to differing treatment of market discount.
In September 2006, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards (SFAS) No. 157 Fair Value Measurements. This standard defines fair value, and establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosures about fair value measurements.
Various inputs are used in determining the value of the Fund's investments. These inputs are summarized in three broad levels:
Level 1--quoted prices in active markets for identical securities
Level 2--other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.
Level 3--significant unobservable inputs (including the Fund's own assumptions in determining the fair value of investments)
The following is a summary of the inputs used to value the Fund's investments as of March 31, 2008:
Valuation Inputs		Investments in Securities
Level 1--Quoted Prices		$443,042
Level 2--Other Significant Observable Inputs		18,683,524
Level 3--Significant Unobservable Inputs		-
Total		$19,126,566

Item 2. Controls and Procedures

(a)

The certifying officers, whose certifications are included herewith, have evaluated the registrant's disclosure controls and procedures as of a date within 90 days of the filing date of this Form N-Q (the "Report"). The registrant's principal executive officer and principal financial officer believe that the disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended) are adequately designed to ensure that material information relating to the registrant is made known to them by others, particularly during the period in which this report is being prepared, so that there is time to allow for decisions regarding required disclosure. Further, in their opinion, the registrant's disclosure controls and procedures are adequately designed, and are operating effectively, to ensure that information required to be disclosed by the registrant in the Report is recorded, processed, summarized and reported by the filing date.

(b)

There were no significant changes in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the registrant's most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting.

Item 3. Exhibits

(a) (1) Certification pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 is filed and attached hereto.

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.

Montana Tax-Free Fund, Inc.

By:	/s/Robert E. Walstad
	Robert E. Walstad
	Interim President

Date: May 28, 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.

Montana Tax-Free Fund, Inc.

By:	/s/Robert E. Walstad
	Robert E. Walstad
	Interim President

Date: May 28, 2008

By:	/s/Adam Forthun
	Adam Forthun
	Treasurer

Date: May 28, 2008