OPPENHEIMER EQUITY INCOME FUND
                      Supplement dated July 16, 1997 to the
                        Prospectus dated November 1, 1996

The Prospectus is changed as follows:

1.   The  Supplement  dated May 1, 1997 to the Prospectus is replaced by
this supplement.

2. The first footnote under the "Shareholder Transaction Expenses" table on page
3 is replaced with the following:

     (1) If you invest $1 million or more  ($500,000  or more for  purchases  by
     "Retirement  Plans",  as  defined  in "Class A  Contingent  Deferred  Sales
     Charge" on page 32) in Class A shares,  you may have to pay a sales  charge
     of up to 1% if you sell your shares  within 12  calendar  months (18 months
     for shares  purchased  prior to May 1,  1997) from the end of the  calendar
     month  during  which you  purchased  those  shares.  See "How to Buy Shares
     Buying Class A Shares", below.

3. The  fundamental  policy  described on page 20 that,  "The Fund cannot buy or
sell  commodities or commodity  contracts  other than those hedging  instruments
which are  considered  commodities"  is replaced with the following  fundamental
policy:

     o The Fund cannot  invest in  physical  commodities  or physical  commodity
     contracts;  however,  the Fund may:  (i) buy and sell  hedging  instruments
     permitted by any of its other  investment  policies,  and (ii) buy and sell
     options,  futures,  securities  or  other  instruments  backed  by,  or the
     investment return from which is linked to changes in the price of, physical
     commodities.

4. The fundamental  policy  described on page 20 that "The Fund cannot engage in
short sales or purchase securities on margin;  however, the Fund may make margin
deposits  in  connection  with  any of the  hedging  instruments  it may use" is
replaced with the following fundamental policy:

     o The Fund cannot  engage in short sales or purchase  securities on margin,
     however,  the Fund may make margin  deposits in connection  with any of its
     investments.

5. The fundamental  policy  described on page 20 that "The Fund cannot mortgage,
pledge or  hypothecate  the Fund's  assets;  the escrow,  collateral  and margin
arrangements  involved with hedging  instruments are not considered to involve a
mortgage,  hypothecation  or pledge" is replaced with the following  fundamental
policy:

                                                                     (Continued)





     o The Fund cannot  mortgage,  pledge or hypothecate the Fund's assets;  the
     escrow,  collateral  and  margin  arrangements  involved  with  any  of its
     investments  are not  considered  to involve a mortgage,  hypothecation  or
     pledge.

6. The  fundamental  policy  described on page 20 that,  "The Fund cannot borrow
money" is replaced with the following fundamental policy:

     o The Fund cannot borrow money, except for temporary, emergency purposes or
     under other unusual circumstances.

7. The second  sentence in "Class A Shares" under "Classes of Shares" on page 27
is replaced by the following:

     If you  purchase  Class A shares  as part of an  investment  of at least $1
     million   ($500,000  for  Retirement  Plans)  in  shares  of  one  or  more
     Oppenheimer  funds,  you will not pay an initial sales  charge,  but if you
     sell any of those shares  within 12 months of buying them (18 months if the
     shares  were  purchased  prior to May 1,  1997),  you may pay a  contingent
     deferred sales charge.

8.   The  following  sentence  is  added to the end of  "Which  Class of
Shares Should You Choose?
- - How Does It Affect Payments To My Broker?"  on page 29:

     The  Distributor  may pay  additional  periodic  compensation  from its own
     resources to securities  dealers or financial  institutions  based upon the
     value of shares of the Fund  owned by the dealer or  financial  institution
     for its own account or for its customers.

9.   The  following  fourth  sub-paragraph  is added to "Buying  Class A
Shares - Class A
Contingent Deferred Sales Charge" on page 32:

        o Purchases by a retirement  plan qualified  under section 401(a) if the
     retirement plan has total plan assets of $500,000 or more.

10. The first sentence in the second paragraph of "Buying Class A Shares - Class
A Contingent Deferred Sales Charge" on page 32 is replaced by the following:

     The Distributor pays dealers of record  commission on those purchases in an
     amount equal to (i) 1.0% for  non-Retirement  Plan  accounts,  and (ii) for
     Retirement Plan accounts, 1.0% of the first $2.5 million, plus 0.50% of the
     next $2.5 million, plus 0.25% of purchases over $5 million, calculated on a
     calendar year basis.


                                                                     (Continued)





11.  In the  third  paragraph  of  "Buying  Class A Shares - Class A  Contingent
Deferred  Sales  Charge"  on page 32,  the first  sentence  is  replaced  by the
following:

     If you redeem any of those shares purchased prior to May 1, 1997, within 18
     months of the end of the  calendar  month of their  purchase,  a contingent
     deferred  sales  charge  (called  the "Class A  contingent  deferred  sales
     charge") may be deducted from the redemption proceeds. A Class A contingent
     deferred sales charge may be deducted from the  redemption  proceeds of any
     of those shares  purchased on or after May 1, 1997 that are redeemed within
     12 months of the end of the calendar month of their purchase.

12.  The third  sentence  of the  second  paragraph  of  "Reduced  Sales
Charges for Class A Share
Purchases  -  Right  of  Accumulation"  on page  33 is  replaced  by the
following:

     The  Distributor  will add the value,  at current  offering  price,  of the
     shares you  previously  purchased and currently own to the value of current
     purchases to determine the sales charge rate that applies.

13. The third sub-paragraph in "Waivers of the Class A Contingent Deferred Sales
Charge for Certain Redemptions" on page 36 is replaced by the following:

        o if,  at the time of  purchase  of shares  (prior  to May 1,  1997) the
     dealer  agreed in  writing  to accept  the  dealer's  portion  of the sales
     commission in  installments  of 1/18th of the  commission per month (and no
     further  commission  will be payable if the shares are  redeemed  within 18
     months of purchase);

        o if, at the time of  purchase  of shares  (on or after May 1, 1997) the
     dealer  agrees in  writing  to accept  the  dealer's  portion  of the sales
     commission in  installments  of 1/12th of the  commission per month (and no
     further  commission  will be payable if the shares are  redeemed  within 12
     months of purchase);

14. The following sub-paragraphs are added at the end of "Waivers of the Class A
Contingent Deferred Sales Charge for Certain Redemptions" on page 36:

        o for  distributions  from Retirement  Plans having 500 or more eligible
     participants,  except  distributions  due  to  termination  of  all  of the
     Oppenheimer funds as an investment option under the Plan; and

        o for distributions  from 401(k) plans sponsored by broker-dealers  that
     have entered into a special  agreement with the  Distributor  allowing this
     waiver.


                                                                     (Continued)




15.  The  following  sentence  is added  to the end of the  third  paragraph  in
"Distribution and Service Plans for Class B and Class C Shares" on page 39:

     If a dealer has a special  agreement with the Distributor,  the Distributor
     will pay the Class B service fee and the  asset-based  sales  charge to the
     dealer  quarterly  in lieu of paying the sales  commission  and service fee
     advance at the time of purchase.

16. The following is added as a new penultimate sentence to the fourth paragraph
of "Distribution and Service Plans for Class B and Class C shares" on page 39:

     If a dealer has a special  agreement with the Distributor,  the Distributor
     shall pay the  Class C  service  fee and  asset-based  sales  charge to the
     dealer  quarterly  in lieu of paying the sales  commission  and service fee
     advance at the time of purchase.

17.  The  introductory  phrase  in  the  sixth  sub-paragraph  of  "Waivers  for
Redemptions of Shares in Certain Cases" in "Waivers of Class B and Class C Sales
Charges" on page 40 is replaced with the following and a new  sub-section (6) is
added as follows:

        o distributions  from  OppenheimerFunds  prototype  401(k) plans
     and from certain
     Massachusetts  Mutual Life Insurance Company prototype 401(k) plans
     . . . (6) for loans to
     participants or beneficiaries.

18.  The  following  sub-paragraph  is added at the end of "Waivers  for
Redemptions of Shares
in Certain  Cases" in "Waivers of Class B and Class C Sales  Charges" on
page 40:

        o Distributions from 401(k) plans sponsored by broker-dealers  that have
     entered into a special agreement with the Distributor allowing this waiver.

19. The section captioned  "Special Investor  Services" is revised by adding the
following after the sub-section captioned "PhoneLink" on page 41:

     Shareholder  Transactions  by Fax.  Beginning  May 30,  1997,  requests for
     certain  account  transactions  may be sent to the  Transfer  Agent  by fax
     (telecopier).  Please  call  1-800-525-  7048 for  information  about which
     transactions  are  included.  Transaction  requests  submitted  by fax  are
     subject  to the same  rules  and  restrictions  as  written  and  telephone
     requests described in this Prospectus.



July 16, 1997                                                 PS0300.010






                         OPPENHEIMER EQUITY INCOME FUND

                      Supplement dated July 16, 1997 to the
          Statement of Additional Information dated November 1, 1996

The Statement of Additional Information is changed as follows:

1. The  fundamental  policy  described on page 18 that,  "The Fund cannot buy or
sell real estate or interests in real estate investment trusts" is replaced with
the following fundamental policy:

     o The Fund cannot invest in real estate or in interests in real estate, but
     may  purchase  securities  of  issuers  holding  real  estate or  interests
     therein.

2. The  fundamental  policy  described  on page 18 that,  "The Fund  cannot  buy
securities of other investment companies,  except in connection with a merger or
consolidation" is eliminated.

3. The fundamental  policy described on page 18 that, "The Fund cannot act as an
underwriter  of  securities  of other  issuers" is replaced  with the  following
fundamental policy:

     o The Fund cannot act as an  underwriter  of securities  of other  issuers,
     except in connection with sales of its portfolio securities.




July 16, 1997                                                       PX0300.004