Exhibit 99.1

Allied Capital Declares 160th Consecutive Quarterly Dividend; Earnings
to be Released July 29, 2003; Conference Call Scheduled

    WASHINGTON--(BUSINESS WIRE)--July 21, 2003--Allied Capital
Corporation (NYSE:ALD) today announced that it has declared a third
quarter dividend of $0.57 per share. This dividend represents the
160th consecutive quarterly dividend declared by Allied Capital since
1963.
    "Investors are focused more than ever on long-term total return.
This 160th dividend marks a 40-year milestone for consecutive
quarterly dividend payments," said Bill Walton, Chairman and CEO of
Allied Capital.



The dividend is payable as follows:
                                 Record date:  September 12, 2003
                                 Payable date: September 26, 2003



    Earnings to be Released July 29, 2003; Investor Web Cast/
Conference Call Scheduled

    Allied Capital Corporation will release second quarter results on
Tuesday, July 29, 2003 before the market opens. The company will host
a webcast/ conference call at 10:15 a.m. (Eastern Time) that morning
to discuss the results for the quarter. All interested parties are
welcome to attend the live webcast, which will be hosted through our
web site at www.alliedcapital.com. Please visit the web site to test
your connection before the call. You can also access the conference
call by dialing (888) 689-4612 approximately 15 minutes prior to the
call. International callers should dial (706) 645-0106. All callers
should reference the passcode "Allied Capital."
    An archived replay of the event will be available on our web site
or by calling (800) 642-1687 through August 12, 2003 (international
callers please dial (706) 645-9291). Please reference passcode
"1142376". For complete information about the webcast / conference
call and the replay, please visit our web site or call Allied Capital
Investor Relations at (888) 818-5298.

    About Allied Capital

    Allied Capital is the nation's largest business development
company and provides long-term debt and equity investment capital to
support the expansion of primarily private companies in a variety of
industries. The company also participates in the real estate capital
markets as an investor in non-investment grade commercial
mortgage-backed securities. The company is headquartered in
Washington, DC. For more information, please visit the web site at
www.alliedcapital.com, call Allied Capital Investor Relations
toll-free at (888) 818-5298, or e-mail us at ir@alliedcapital.com.

    Forward-Looking Statements

    The information contained in this press release contains
forward-looking statements. These forward-looking statements are
subject to the inherent uncertainties in predicting future results and
conditions. Certain factors could cause actual results and conditions
to differ materially from those projected in these forward-looking
statements, and these factors are enumerated in Allied Capital's
filings with the Securities and Exchange Commission.

    CONTACT: Allied Capital Corporation, Washington
             Suzanne Sparrow, 202-973-6326