STAR U.S. GOVERNMENT INCOME FUND
(A PORTFOLIO OF STAR FUNDS)
Supplement to Prospectus dated January 31, 1994
Please add the following as a fifth paragraph under the sub-
section entitled "Other Acceptable Investments" on pages 4 and 5:
     "o   debt securities of foreign governments, foreign
     governmental agencies or supranational institutions.
     In addition, the Fund will also invest in investment
     quality debt securities issued by foreign corporations.
     These securities will be rated in one of the four
     highest rating categories by the above-mentioned
     nationally recognized statistical rating organizations,
     or, if unrated, will be of comparable quality in the
     judgment of the adviser.  (The Fund may not invest more
     than 5% of its assets in foreign debt securities)."
     
     
     
                                                  August 30, 1994


   FEDERATED SECURITIES CORP.

   Distributor
   A subsidiary of Federated
   Investors
   Federated Investors Tower
   Pittsburgh, PA  15222-3779
   854911500
   005947 (8/94)

STAR U.S. GOVERNMENT INCOME FUND
(A PORTFOLIO OF STAR FUNDS)
Supplement to Statement of Additional Information dated January 31, 1994
Please add the following immediately before the sub-section
entitled "Restricted and Illiquid Securities" on page 2 and
insert the heading "Investments in Foreign Securities" into the
Table of Contents:
     "Investments in Foreign Securities.  The Fund may
     invest in foreign securities.  Investments in foreign
     securities involve special risks that differ from those
     associated with investments in domestic securities.
     The risks associated with investments in foreign
     securities relate to political and economic
     developments abroad, as well as those that result from
     the differences between the regulation of domestic
     securities and issuers and foreign securities and
     issuers.  These risks may include, but are not limited
     to, expropriation, confiscatory taxation, currency
     fluctuations, withholding taxes on interest,
     limitations on the use or transfer of Fund assets,
     political or social instability and adverse diplomatic
     developments.  In addition, there are restrictions on
     foreign investments in other jurisdictions and there
     tends to be difficulty in obtaining judgments from
     abroad and effecting repatriation of capital invested
     abroad.  Delays could occur in settlement of foreign
     transactions, which could adversely affect shareholder
     equity.  Moreover, individual foreign economies may
     differ favorably or unfavorably from the domestic
     economy in such respects as growth of gross national
     product, the rate of inflation, capital reinvestment,
     resource self-sufficiency and balance of payments
     position."
     
     
                                                  August 30, 1994


   FEDERATED SECURITIES CORP.

   Distributor
   A subsidiary of Federated
   Investors
   Federated Investors Tower
   Pittsburgh, PA  15222-3779
   854911500
   005948 (8/94)