<DOCUMENT>
<TYPE>N-2/A
<SEQUENCE>1
<FILENAME>n2form.txt
<DESCRIPTION>PRE-EFFECTIVE AMENDMENT NO. 1
<TEXT>

    As filed with the Securities and Exchange Commission on August 2, 2001

                                                    1933 Act File No. 333-63956
                                                    1940 Act File No. 811-4537

                    U. S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                    Form N-2
                        (Check appropriate box or boxes)

[X]      REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
[X]      Pre-Effective Amendment No. 1

[ ]      Post-Effective Amendment No._________

                                      and

[X]      REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
[X]      Amendment No. 14

                        Liberty All-Star Growth Fund, Inc.
         Exact Name of Registrant as Specified in Articles of Incorporation

                   600 Atlantic Avenue, Federal Reserve Plaza
                           Boston, Massachusetts 02210
                     Address of Principal Executive Offices
                     (Number, Street, City, State, Zip Code)

                                 617-722-6000
               Registrant's Telephone Number, including Area Code


           William J. Ballou                         Jeremiah J. Bresnahan
              Secretary                              Bingham Dana LLC
     Liberty All-Star Growth Fund, Inc.              150 Federal Street
        One Financial Center                         Boston, MA 02110
          Boston, MA 02111

           Approximate Date of Proposed Public Offering:
As soon as practicable after the effective date of this Registration Statement.

If any of the securities  being registered on this form are offered on a delayed
or continuous  basis in reliance on Rule 415 under the  Securities  Act of 1933,
other than securities  offered in connection with a dividend  reinvestment plan,
check the following box. [X]

   It is proposed that this filing will become effective (check appropriate box)

[X] when declared effective pursuant to section 8(c)
[ ] immediately upon filing pursuant to paragraph (b) of Rule 486
[ ] on (date) pursuant to paragraph (b) of Rule 486
[ ] 60 days after  filing  pursuant  to  paragraph  (a) of Rule 486
[_] on(date) pursuant to paragraph (a) of Rule 486

     [_] This  post-effective  amendment  designates a new effective  date for a
         previously filed registration statement.
     [_] The Form is filed to  register  additional  securities  for an offering
         pursuant to Rule 462(b) under the Securities Act and the Securities Act
         registration number of the earlier effective registration statement is
         --------.

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL REGISTRANT SHALL FILE A
FURTHER AMENDMENT WHICH SPECIFICIALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.

<PAGE>

<TABLE>
<CAPTION>

                                                PROPOSED
PROPOSED
TITLE                                           MAXIMUM
MAXIMUM            AMOUNT OF
OF SECURITIES             AMOUNT                OFFERING PRICE
AGGREGATE          REGISTRATION
BEING REGISTERED          BEING REGISTERED(1)   PER UNIT
OFFERING PRICE(1)  FEE(2)
----------------          -------------------   --------------
--------------     -------------
<S>                       <C>                    <C>                     <C>
             <C>
Common Stock              2,137,620              $9.44
$20,179,132          $5,045

(1)  Previously registered.
(2)  Previously paid.

</TABLE>





<PAGE>

                     16,942,250 Rights for 2,117,781 Shares


                       LIBERTY ALL-STAR GROWTH FUND, INC.

                                  Common Stock


     Liberty  All-Star Growth Fund, Inc.  ("All-Star" or the "Fund") is offering
rights (the "Rights") to its shareholders (the "Offer"). These Rights will allow
you to subscribe for new shares of common stock of All-Star (the "Shares").  For
every eight Rights that you receive,  you may buy one new  All-Star  share.  You
will receive one Right for each outstanding  All-Star share you own on August 6,
2001 (the "Record Date"). Fractional shares will not be issued upon the exercise
of the  Rights.  Accordingly,  shares  may be  purchased  only  pursuant  to the
exercise of Rights in integral  multiples of eight.  Also,  shareholders  on the
Record  Date may  purchase  shares not  acquired by other  shareholders  in this
Rights offering, subject to limitations discussed in this prospectus. The Rights
are not  transferable and will not be admitted for trading on the New York Stock
Exchange.  See "The Offer." THE SUBSCRIPTION  PRICE PER SHARE WILL BE 95% OF THE
LOWER OF (i) THE LAST  REPORTED  SALE  PRICE ON THE NEW YORK STOCK  EXCHANGE  ON
SEPTEMBER 11, 2001 (the "Pricing Date") OF A SHARE OF ALL-STAR,  OR (ii) THE NET
ASSET VALUE OF A SHARE OF ALL-STAR ON THAT DATE.



     THE OFFER WILL EXPIRE AT 5:00 P.M.,  NEW YORK TIME,  ON SEPTEMBER  10, 2001
(the "Expiration Date").  SINCE THE CLOSE OF THE OFFERING ON THE EXPIRATION DATE
IS PRIOR TO THE PRICING DATE,  SHAREHOLDERS  WHO CHOOSE TO EXERCISE THEIR RIGHTS
WILL NOT KNOW THE  SUBSCRIPTION  PRICE PER SHARE AT THE TIME THEY  EXERCISE SUCH
RIGHTS.



     For   additional    information,    please   call   Georgeson   Shareholder
Communications Inc. (the "Information Agent") toll free at (888) 420-8683.



     All-Star is a multi-managed  diversified,  closed-end management investment
company that  allocates its  portfolio  assets on an  approximately  equal basis
among several independent investment  organizations  (currently three in number)
("Portfolio  Managers")  having  different  investment  styles  recommended  and
monitored  by  Liberty  Asset  Management  Company,   All-Star's  fund  manager.
All-Star's  investment objective is to seek long term capital  appreciation.  It
seeks its investment  objective  through  investment  primarily in a diversified
portfolio of equity securities. An investment in All-Star is not appropriate for
all investors.  No assurances can be given that All-Star's  investment objective
will  be  achieved.  For a  discussion  of  certain  risk  factors  and  special
considerations  with  respect  to  owning  shares  of  All-Star,   see  "Special
Considerations and Risk Factors" beginning on page 17 of this Prospectus.


     The address of All-Star is Federal  Reserve  Plaza,  600  Atlantic  Avenue,
Boston,  Massachusetts  02210-2214 and its telephone  number is  1-800-542-3863.
All-Star's  shares are listed on the New York  Stock  Exchange  under the symbol
"ASG."


     All-Star  announced the terms of the Offer before the opening of trading on
the New York Stock  Exchange on June 21, 2001.  The net asset value per share of
common stock of All-Star at the close of business on June 20, 2001 and August 6,
2001 was $9.09 and $_____,  respectively,  and the last reported sale price of a
share on such Exchange on those dates was $9.45 and $______, respectively.

     Neither the  Securities and Exchange  Commission  nor any State  securities
commission  has approved or disapproved  these  securities or determined if this
Prospectus  is truthful or  complete.  Any  representation  to the contrary is a
crime.

<TABLE>
<S>                                              <C>
   <C>                  <C>
---------------------------------------------- ---------------------------
----------------------------- -------------------------
                                                 Subscription Price(1)
   Sales Load           Proceeds to All-Star(2)
---------------------------------------------- ---------------------------
----------------------------- -------------------------
---------------------------------------------- ---------------------------
----------------------------- -------------------------
Per share...................................               $
      NONE                         $
---------------------------------------------- ---------------------------
----------------------------- -------------------------
---------------------------------------------- ---------------------------
----------------------------- -------------------------
Total........................................              $
      NONE                         $
---------------------------------------------- ---------------------------
----------------------------- -------------------------
</TABLE>


(1)  Estimated  based on an assumed  Subscription  Price of 95% of the net asset
     value on August 6, 2001.
(2)  Before deduction of expenses payable by All-Star, estimated at $150,000.


     Shareholders who do not exercise their Rights should expect that they will,
at the completion of the Offer, own a smaller proportional  interest in the Fund
than if they exercised their Rights. As a result of the Offer you may experience
an immediate  dilution of the  aggregate  net asset value of your shares,  which
under  certain  circumstances,   could  be  substantial.  This  is  because  the
Subscription  Price per share  and/or the net  proceeds to All-Star for each new
share  sold  will be less  than  All-Star's  net  asset  value  per share on the
Expiration Date.  All-Star cannot state precisely the extent of this dilution at
this time  because it does not know what the net asset value or market price per
share will be when the Offer  expires or what  proportion  of the Rights will be
exercised.



     This Prospectus  sets forth  concisely the  information  that a shareholder
ought to know before exercising his or her Rights. Investors are advised to read
and retain it for future reference.  A Statement of Additional Information dated
August [ ], 2001 has been filed with the Securities and Exchange  Commission and
is incorporated by reference in its entirety into this Prospectus.  The table of
contents of the Statement of Additional  Information  appears on page 27 of this
Prospectus,  and a copy is  available  at no charge by calling  the  Information
Agent at (888) 420-8683.



                 The date of this Prospectus is August [   ], 2001.


                               PROSPECTUS SUMMARY

     This summary  highlights  some  information  that is  described  more fully
elsewhere in this Prospectus.  It may not contain all of the information that is
important  to you. To  understand  the Offer  fully,  you should read the entire
document carefully, including the risk factors.

Purpose of the Offer


     The Board of Directors of All-Star has  determined  that it would be in the
best  interest  of  All-Star  and its  shareholders  to  increase  the assets of
All-Star available for investment so that it may be in a better position to take
advantage of investment  opportunities that may arise. The Offer seeks to reward
existing  shareholders  in All-Star by giving them the  opportunity  to purchase
additional  Shares at a price  below  market  and/or net asset value and without
incurring any brokerage commissions. See "The Offer-Purpose of the Offer."



     The Board of Directors  believes that a larger number of outstanding Shares
could  increase the level of market  interest in and  visibility of the Fund and
improve  the  trading  liquidity  of the  Fund's  shares  on the New York  Stock
Exchange ("NYSE").


Important Terms of the Offer

<TABLE>
<S>                                                               <C>


Total number of shares available for primary subscription...      2,117,781
shares
Number of Rights you will receive for each outstanding
   share you own on the Record                                    One Right for
every one share
Date........................................
Number of shares you may purchase with your Rights at the
   Subscription Price per                                         One share for
every eight Rights
share..................................................
Subscription                                                      95% of the
lower of (i) the last reported sale price on the
Price.....................................................        NYSE on
September 11, 2001 (the "Pricing Date") of a share
                                                                  of common
stock of All-Star, or (ii) the net asset value of
                                                                  a share of
All-Star on the Pricing Date.

</TABLE>



--------------------------------------------------------------------------------
                 Shareholders' inquiries should be directed to:
                    Georgeson Shareholder Communications Inc.
                                 (888) 420-8683
--------------------------------------------------------------------------------


Over-Subscription Privilege


     The right to acquire  during the  Subscription  Period at the  Subscription
Price one additonal Share for each eight Rights held is hereinafter  referred to
as the  "Primary  Subscription."  Shareholders  on the  Record  Date  who  fully
exercise  all Rights  issued to him or her (other than those Rights which cannot
be exercised  because they  represent  the right to acquire less than one Share)
are entitled to subscribe for Shares which were not otherwise  subscribed for by
others on Primary Subscription (the "Over-Subscription Privilege"). For purposes
of determining the maximum number of Shares a shareholder  may acquire  pursuant
to the Offer, broker-dealers whose Shares are held of record by Cede & Co., Inc.
("Cede"),  nominee for Depository  Trust Company,  or by any other depository or
nominee  will be deemed to be the  holders of the Rights that are issued to Cede
or such  other  depository  or  nominee.  If enough  Shares are  available,  all
shareholder  requests to buy Shares that were not bought by other Rights holders
will be honored in full. If the requests for Shares exceed the Shares available,
the available Shares will be allocated pro rata among those  shareholders on the
Record Date who  over-subscribe  based on the number of Rights originally issued
to them by the Fund. Shares acquired pursuant to the Over-Subscription Privilege
are  subject  to   allotment,   which  is  more  fully   discussed   under  "The
Offer--Over-Subscription Privilege."


Method for Exercising Rights


     Except as described below,  subscription certificates evidencing the Rights
("Subscription  Certificates")  will be sent to  shareholders on the Record Date
("Record Date  Shareholders")  or their  nominees.  If you wish to exercise your
Rights, you may do so in the following ways:


     (1) Complete and sign the Subscription Certificate. Mail it in the envelope
provided  or  deliver  it,  together  with  payment in full to  EquiServe  Trust
Company,   N.A.   ("Subscription   Agent")  at  the  address  indicated  on  the
Subscription Certificate. Your completed and signed Subscription Certificate and
payment must be received by the Expiration Date.

     (2) Contact your broker,  banker or trust  company,  which can arrange,  on
your  behalf,  to  guarantee  delivery  of payment  and  delivery  of a properly
completed  and  executed  Subscription  Certificate  pursuant  to  a  notice  of
guaranteed  delivery ("Notice of Guaranteed  Delivery") by the close of business
on the third  business day after the  Expiration  Date. A fee may be charged for
this  service.  The  Notice  of  Guaranteed  Delivery  must be  received  by the
Expiration Date.

     Rights  holders  will  have no  right  to  rescind  a  purchase  after  the
Subscription Agent has received payment.  See "The Offer - Method of Exercise of
Rights" and "The Offer - Payment for Shares."

     Since the Expiration  Date is prior to the Pricing Date,  shareholders  who
choose to exercise  their  Rights will not know at the time they  exercise  such
Rights what the purchase  price for Shares  acquired  pursuant to such  exercise
will be.  Shareholders  will have no right to rescind their  subscription  after
receipt of their  payment  for Shares by the  Subscription  Agent.  Subscription
payments  will be held  by the  Subscription  Agent  pending  completion  of the
processing of the subscription. No interest thereon will be paid to subscribers.

     The Rights are not transferable. Therefore, only the underlying Shares, and
not the Rights,  will be  admitted  for  trading on the NYSE.  Since  fractional
shares will not be issued on exercise of Rights,  shareholders  who receive,  or
are left with,  fewer than eight  Rights will be unable to exercise  such Rights
and will not be entitled to receive any cash in lieu of unexercised rights.


     Shareholders' inquiries about the Offer should be directed to their broker,
bank or trust company, or to:

             Georgeson Shareholder Communications Inc.
             1-888-420-8683



Important Dates to Remember

Please note that the dates in the table below may change if the offer is
extended.

---------------------------------------------- --------------------------
Event                                          Date
---------------------------------------------- --------------------------
---------------------------------------------- --------------------------
Record                                         August 6, 2001
Date.........................................
---------------------------------------------- --------------------------
---------------------------------------------- --------------------------
Subscription                                   August 10, 2001 through
Period.......................................  September 10, 2001*
---------------------------------------------- --------------------------
---------------------------------------------- --------------------------
Expiration Date (Deadline for delivery of
Subscription Certificate together with
payment of estimated Subscription Price or
for delivery of Notice of Guaranteed
Delivery)....................................  September 10, 2001
---------------------------------------------- --------------------------------
---------------------------------------------- --------------------------------
Pricing                                        September 11, 2001
Date.........................................
---------------------------------------------- --------------------------------
---------------------------------------------- --------------------------------
Deadline for payment of final Subscription
Price pursuant to Notice of Guaranteed
Delivery...................................... September 13, 2001
---------------------------------------------- --------------------------------
---------------------------------------------- --------------------------------
Confirmation to Registered                     September 24, 2001
Shareholders........................
---------------------------------------------- --------------------------------
---------------------------------------------- --------------------------------
For Registered Shareholders' Subscriptions -
deadline for payment of unpaid balance if
final Subscription Price is higher than
Estimated Subscription Price...........        October 4, 2001
---------------------------------------------- --------------------------------


--------------------


* Unless the Offer is extended.


<PAGE>


Offering Fees and Expenses

      Offering expenses incurred by the Fund are estimated to be $135,000.

Restrictions on Foreign Shareholders

     Record date  Shareholders  whose  record  addresses  are outside the United
States  will  receive  written  notice  of  the  Offer;  however,   Subscription
Certificates will not be mailed to such shareholders.  The Rights to which those
Subscription Certificates relate will be held by the subscription agent for such
foreign Record Date  Shareholders'  accounts until  instructions are received in
writing  with  payment to  exercise  the  Rights.  If no such  instructions  are
received by the  Expiration  Date,  such Rights will expire.  See  "Subscription
Agent".

Information about All-Star

     All-Star is a multi-managed  diversified,  closed-end management investment
company  registered under the Investment  Company Act of 1940, as amended ("1940
Act") that allocates its assets on an  approximately  equal basis among a number
of independent investment management  organizations  (currently three in number)
each having a  different  investment  style.  See "The  Multi-Manager  Concept."
All-Star's  investment objective is to seek long-term capital  appreciation.  It
seeks its objective through  investment  primarily (at least 65% of total assets
under normal conditions) in a diversified  portfolio of equity  securities.  The
portion of All-Star's portfolio not invested in equity securities (not more than
35% of total  assets  under normal  conditions)  is  generally  invested in U.S.
Government  Securities,  repurchase agreements with respect thereto, and certain
money market mutual funds. See "Investment Objective and Policies."


     All-Star  commenced  investment  operations  in March  1986  under the name
"Growth  Stock  Outlook  Trust,  Inc." (see  "History of the Fund"  below).  Its
outstanding  shares of Common  Stock are listed  and traded on the NYSE  (Symbol
"ASG").  The average  weekly trading volume of the shares on the NYSE during the
year  ended  December  31,  2000 was  198,202  shares.  As of  August  6,  2001,
All-Star's net assets were $___________,  and __________ shares of All-Star were
issued and outstanding.


Information about Liberty Asset Management Company


     Liberty  Asset  Management  Company  ("LAMCO" or "Fund  Manager")  provides
selection, evaluation and monitoring services to All-Star and is responsible for
the  provision  of  administrative  services  to the  Fund,  some of  which  are
delegated  to  LAMCO's   affiliate,   Colonial   Management   Associates,   Inc.
("Colonial").  See  "Management  of  All-Star"  for the fees paid by the Fund to
LAMCO and by LAMCO to the  Portfolio  Managers.  Since the fees of LAMCO and the
Portfolio Managers are based on the average weekly net assets of All-Star, LAMCO
and the  Portfolio  Managers  will benefit from the Offer.  See  "Management  of
All-Star." As of May 31, 2001, LAMCO managed over $1.4 billion in assets.



     LAMCO, organized in 1985, is an indirect wholly-owned subsidiary of Liberty
Financial Companies,  Inc. ("Liberty Financial").  Liberty Financial is a direct
majority-owned  subsidiary  of LFC  Management  Corporation,  which in turn is a
direct  wholly-owned  subsidiary of Liberty Corporate  Holdings,  Inc., which in
turn is a direct wholly-owned subsidiary of LFC Holdings, Inc., which in turn is
a direct wholly-owned subsidiary of Liberty Mutual Equity Corporation,  which in
turn is a direct  wholly-owned  subsidiary of Liberty Mutual  Insurance  Company
("Liberty Mutual"). As of June 30, 2001, LFC Management Corporation owned 70.46%
of the common  stock of LFC and the  balance is held by the public and listed on
the  New  York  Stock  Exchange.  LFC  is a  diversified  and  integrated  asset
management  organization  which provides  insurance and  investment  products to
individuals  and  institutions.  Liberty  Mutual is an  underwriter  of workers'
compensation insurance and a property and casualty insurer in the United States,
organized  under  the laws of  Massachusetts  in 1912.  The  principal  business
activities of Liberty Mutual's subsidiaries other than LFC are property-casualty
insurance,  insurance  services  and life  insurance  (including  group life and
health insurance  products)  marketed through its own sales force. The principal
executive offices of LFC Management  Corporation,  Liberty  Corporate  Holdings,
Inc.,  and  LFC  Holdings,  Inc.,  Liberty  Mutual  and  Liberty  Mutual  Equity
Corporation are located at 175 Berkeley Street, Boston, Massachusetts 02117.

     On June 4, 2001 Liberty  Financial  announced  that Fleet National Bank has
agreed to acquire  Liberty  Financial's  asset  management  business,  including
LAMCO. Fleet National Bank is an indirect wholly-owned subsidiary of FleetBoston
Financial  Corporation,  a U.S.  financial  holding company.  The closing of the
proposed  transaction  is expected to take place  during the second half of 2001
and is subject to a number of conditions, including approval by the shareholders
of Liberty  Financial.  Consummation of the acquisition by Fleet is subject to a
number of  contingencies,  including  regulatory  approvals  and approval of the
shareholders  of  Liberty  Financial.  Under  the  rules  for  mutual  funds the
transaction  may result in a change of  control  for LAMCO  and,  therefore,  an
assignment of the Funds'  investment  advisory and sub-advisory  agreements with
LAMCO and the Funds' respective Portfolio Managers,  which requires, among other
things, a shareholder vote under the 1940 Act.  Consequently,  it is anticipated
that LAMCO will seek  approval of new  agreements  from the Funds'  shareholders
prior to  consummation  of the  acquisition,  which is  expected to close in the
second half of 2001.

Special Considerations and Risk Factors

     The  following  summarizes  some of the  matters  that you should  consider
before investing in All-Star through the Offer.


Dilution............. Shareholders who do not fully exercise their Rights should
                      expect that they will, at the completion of the Offer, own
                      a smaller proportional interest in the Fund than if they
                      exercised their Rights.  As a result of the Offer you may
                      experience an immediate dilution of the aggregate net
                      asset value of your shares, which, under certain
                      circumstances, may be substantial.  This is because the
                      Subscription Price per share and/or the net proceeds to
                      the Fund for each new share sold will be less than the
                      Fund's net asset value per share on the Expiration Date.
                      Although it is not possible to state precisely the amount
                      of such dilution because it is not known at this time how
                      many shares will be subscribed for or what the net asset
                      value or market price per share will be on the Pricing
                      Date, All-Star estimates that such dilution should not be
                      substantial. For example, if All-Star's Shares are trading
                      at a premium from their net asset value of 0.25% (the
                      average premium for the five-month period ended May 31,
                      2001), and assuming all Rights are exercised, the
                      Subscription Price would be 5% below All-Star's net asset
                      value per share, resulting in a reduction of such net
                      asset value of approximately $0.06 per share, or less than
                      0.7%.  See "Risk Factors and Special Considerations -
                      Dilution."




Distributions........ All-Star currently has a policy of paying distributions on
                      its Shares totalling approximately 10% of its net asset
                      value per year, payable in four quarterly distributions of
                      2.5% of its net asset value at the close of the NYSE on
                      the Friday prior to each quarterly declaration date. These
                      fixed distributions, which are not related to All-Star's
                      net investment income or net realized capital gains or
                      losses, will be treated as ordinary dividend income up to
                      the amount of All-Star's current and accumulated earnings
                      and profits.  If, for any calendar year, the total
                      distributions made under the 10% pay-out policy exceed
                      All-Star's net investment income and net realized capital
                      gains, the excess will be treated as a tax-free return of
                      capital to each shareholder (up to the amount of the
                      shareholder's basis in his or her shares) and thereafter
                      as gain from the sale of shares. The amount treated as a
                      tax-free return of capital will reduce the shareholder's
                      adjusted basis in his or her shares, thereby increasing
                      his or her potential gain or reducing his or her potential
                      loss on the subsequent sale of his or her shares.



                    All-Star  may, in the  discretion of the Board of Directors,
                    retain for reinvestment,  and not distribute,  net long-term
                    capital  gains in excess of net  short-term  capital  losses
                    ("net capital gain") for any year to the extent that its net
                    investment  income and net realized gains exceed the minimum
                    amount  required to be  distributed  for such year under the
                    10% pay-out policy,  although All-Star reserves the right to
                    distribute  such  excess.  Retained net capital gain will be
                    taxed to both  All-Star  and the  shareholders  as long-term
                    capital gains;  however,  each  shareholder  will be able to
                    claim a  proportionate  share of the federal income tax paid
                    by  All-Star  as a  credit  against  his or her own  federal
                    income tax  liability  and will be entitled to increase  the
                    adjusted  tax basis in his or her  shares by the  difference
                    between the amount taxed and the credit. See "Distributions;
                    Automatic Dividend Reinvestment and Cash Purchase Plan."



Closed-end fund
discounts............ Shares of closed-end funds frequently trade at a market
                      price that is less than the value of the net assets
                      attributable to those shares.  The possibility that Shares
                      of All-Star will trade at a discount from net asset value
                      is a risk separate and distinct from the risk that
                      All-Star's net asset value will decrease.  The risk of
                      purchasing shares of a closed-end fund that might trade at
                      a discount is more pronounced for investors who wish to
                      sell their shares in a relatively short period of time
                      because, for those investors, realization of a gain or
                      loss on their investments is likely to be more dependent
                      upon the existence of a premium or discount than upon
                      portfolio performance.  See "Share Price Data."



Anti-takeover
Provisions........... All-Star's Articles of Incorporation and By-laws have
                      provisions (commonly referred to as "anti-takeover
                      provisions") which are intended to have the effect of
                      limiting the ability of other entities or persons to
                      acquire control of All-Star, to cause it to engage in
                      certain transactions, or to modify its structure.
                      For instance, the affirmative vote of 66 2/3 percent of
                      the shares of the Fund is required to authorize All-Star's
                      conversion from a closed-end to an open-end investment
                      company.  A similar shareholder vote is required to
                      authorize a merger, sale of a substantial part of the
                      assets, issuance of securities for cash, or similar
                      transaction with a person beneficially owning five percent
                      or more of All-Star's Shares, unless approved by
                      All-Star's Board of Directors under certain conditions.
                      These provisions cannot be amended without a similar
                      super-majority vote. In addition, All-Star's Board of
                      Directors is divided into three classes, each of which
                      has a term of three years and only one of which is elected
                      at each annual meeting of shareholders. See "Description
                      of Shares--Anti-takeover Provisions of the Articles of
                      Incorporation and By-laws; Super-majority Vote
                      Requirement for Conversion to Open-End Status."



Repurchase........... You will be free to dispose of your Shares on the NYSE or
                      other markets on which the Shares may trade, but, because
                      the Fund is a closed-end fund, you do not have the right
                      to redeem your Shares.


     You should  carefully  consider your ability to assume the foregoing  risks
before  making an investment in the Fund. An investment in shares of the Fund is
not appropriate for all investors.


<PAGE>



                                    EXPENSES

Shareholder Transaction Expenses


     These are the  expenses  that an  investor  incurs  when  buying  shares of
All-Star,  whether in this  Offer,  in the  open-market  or  through  All-Star's
Automatic Dividend Reinvestment and Cash Purchase Plan, as amended ("Plan").


 Sales Load ...............................   None(l)
Automatic Dividend Reinvestment
   and Cash Purchase Plan Fees ............  $1.25 per voluntary cash investment

(1)  No sales load or commission  will be payable in connection with this Offer.
     Purchases of shares through brokers in secondary  market  transactions  are
     subject to brokers' commissions and charges.

Annual Expenses (as a percentage of net assets attributable to Common Stock)

 Management and administrative fees ..................................... 1.00 %
 Other Expenses.......................................................... 0.23 %
                                                                         -------
 Total Annual Expenses .................................................. 1.23 %

Example:  You would pay the following  expenses on an  investment  (at net asset
value) of $1,000, assuming a 5% annual return.

          1 Year            3 Years           5 Years          10 Years
          -------           --------          --------         --------
          $13               $39               $68              $149


     These figures are intended to illustrate the effect of All-Star's expenses,
but are not meant to  predict  its future  returns  and  expenses,  which may be
higher or lower than those shown.


     The purpose of the above tables is to assist investors in understanding the
various  costs and expenses  that an investor in All-Star  will bear directly or
indirectly.  The numbers shown under the Annual  Expenses table are  projections
based on All-Star's actual expenses for the year ended December 31, 2000, and on
its  projected  net  assets  assuming  the Offer is fully  subscribed  for at an
assumed  Subscription Price of $_____ per share. See "Financial  Highlights" for
All-Star's  actual  ratio of  expenses  to average net assets for the year ended
December 31, 2000.



<PAGE>


                              FINANCIAL HIGHLIGHTS


The financial  highlights  table is intended to help you  understand  the Fund's
financial  performance.  Information  is shown for the  Fund's  last ten  fiscal
years,  unless  otherwise  indicated.  Certain  information  reflects  financial
results  from a single Fund Share.  The  information  for the fiscal years ended
December    31,   1999   and   December   31,   2000   has   been   audited   by
PricewaterhouseCoopers LLP, independent accountants. The information included in
the Fund's  financial  statements  for periods prior to 1999 had been audited by
KPMG, LLP independent  auditors,  whose report  expressed an unqualified
opinion on those financial    statements    and    financial    highlights.
The    report   of PricewaterhouseCoopers  LLP, together with the financial
statements of the Fund, are included in the Fund's December 31, 2000 Annual
Report and are  incorporated by reference into the Statement of Additional
Information (see cover page).


<TABLE>
<CAPTION>

                                                                        For the
Year Ended December 31,

                                                              2000       1999
    1998       1997        1996



PER SHARE OPERATING PERFORMANCE:


<S>                                                         <C>         <C>
  <C>         <C>        <C>
                                                            $13.44      $13.03
  $12.89      $11.27     $10.55
                                                            ------      ------
  ------      ------     ------
Net asset value at beginning of year

Income from Investment Operations:
                                                             (0.09)      (0.05)
   (0.03)      (0.02)      0.01
         Net investment income (loss)
         Net realized and unrealized gains                   (1.15)       1.83
    1.73        2.88       1.86
                                                             ------       ----
    ----        ----       ----
         (losses) on investments
                                                             (1.24)       1.78
    1.70        2.86       1.87
                                                             ------       ----
    ----        ----       ----
Total from Investment Operations

Less Distributions from:
                                                              ----       ----
    ----       ----       (0.01)
         Net Investment income
                                                             (0.05)      ----
   (0.83)      ----        ----
         Paid-in capital
                                                             (1.22)      (1.23)
   (0.52)      (1.24)     (1.01)
         Realized capital gains
                                                             (0.07)      ----
    ----       ----        ----
                                                             ------      ----
    ----       ----        ----
         In excess of realized capital gains
                                                             (1.34)      (1.23)
   (1.35)      (1.24)     (1.02)
                                                             ------      ------
   ------      ------     ------
Total Distributions
                                                              ----       ----
   (0.21)      ----        ----
Change due to rights offering (a)
Impact of shares issued in dividend reinvestment (b)          ----       (0.14)
    ----       ----       (0.13)
                                                              ----       ------
    ----       ----       ------
Total Distributions, Reinvestments and Rights Offering       (1.34)      (1.37)
   (1.56)      (1.24)     (1.15)
                                                             ------      ------
   ------      ------     ------
                                                             $10.86     $13.44
   $13.03     $12.89      $11.27
                                                             ------     ------
   ------     ------      ------
Net asset value at end of year
                                                             $9.438     $10.813
  $11.438     $11.938     $9.250
                                                             ------     -------
  -------     -------     ------
Market price at end of year

TOTAL INVESTMENT RETURN FOR SHAREHOLDERS: (c)
                                                             (9.1)%      15.9%
   15.3%       27.3%      18.3%
Based on net asset value
                                                             (1.8)%       6.2%
    9.3%       43.6%       9.3%
Based on market price

RATIOS AND SUPPLEMENTAL DATA:
                                                              $180       $219
    $199       $167        $137
Net assets at end of year (millions)
                                                              1.21%       1.20%
    1.22%       1.20%      1.35%
Ratio of expenses to average net assets

Ratio of net investment income (loss) to average net         (0.71)%     (0.37)%
   (0.22)%     (0.18)%     0.06%
        assets
                                                             62%         71%
   33%         57%        51%
Portfolio turnover rate

</TABLE>

(a)  Effect of Fund's  rights  offering  for  shares at a price  below net asset
     value.
(b)  Effect of payment  of a portion of  distributions  in newly  issued  shares
     valued at a discount from net asset value.
(c)  Calculated assuming all distributions reinvested at the actual reinvestment
     price and all primary rights exercised.



<PAGE>



<TABLE>
<CAPTION>

                                                                       For the
Year Ended December 31,

<S>                                                           <C>        <C>
    <C>        <C>         <C>
                                                              1995       1994
    1993       1992        1991
PER SHARE OPERATING PERFORMANCE:

                                                              $9.95      $10.54
   $10.28      $10.40      $9.90
                                                              -----      ------
   ------      ------      -----
Net asset value at beginning of year

Income from Investment Operations:
                                                               0.31        0.23
     0.18        0.29       0.44
         Net investment income (loss)
         Net realized and unrealized gains                     1.05       (0.24)
     0.56        0.03       0.71
                                                               ----       ------
     ----        ----       ----
                 (losses) on investments
                                                               1.36       (0.01)
     0.74        0.32       1.15
                                                               ----       ------
     ----        ----       ----
Total from Investment Operations

Less Distributions from:
                                                              (0.31)      (0.23)
    (0.18)      (0.30)     (0.44)
         Net Investment income
                                                              ----       ----
    ----       ----        ----
         Paid-in capital
                                                              (0.45)      (0.35)
    (0.30)      (0.14)     (0.21)
                                                              ------      ------
    ------      ------     ------
         Realized capital gains
                                                              ----       ----
    ----       ----        ----
         In excess of realized capital gains
                                                              (0.76)      (0.58)
    (0.48)      (0.44)     (0.65)
                                                              ------      ------
    ------      ------     ------
Total Distributions
                                                              ----       ----
    ----       ----        ----
Change due to rights offering (a)
Impact of shares issued in dividend                           ----       ----
    ----       ----        ----
                                                              ----       ----
    ----       ----        ----
         reinvestment (b)
Total Distributions, Reinvestments and Rights                 (0.76)      (0.58)
    (0.48)      (0.44)     (0.65)
                                                              ------      ------
    ------      ------     ------
         Offering
                                                             $10.55      $9.95
   $10.54     $10.28      $10.40
                                                             ------      -----
   ------     ------      ------
Net asset value at end of year
                                                             $9.375     $8.500
  $10.250     $10.00      $10.00
                                                             ------     ------
  -------     ------      ------
Market price at end of year

TOTAL INVESTMENT RETURN FOR SHAREHOLDERS: (c)
                                                              14.6%       0.5%
   7.2%        3.2%      11.9%
Based on net asset value
                                                              19.3%      (11.7)%
   7.2%        4.4%       3.9%
Based on market price

RATIOS AND SUPPLEMENTAL DATA:
                                                              $120       $113
    $125       $123        $125
Net assets at end of year (millions)
                                                               1.42%       1.51%
     1.35%       1.33%     1.31%
Ratio of expenses to average net assets

Ratio of net investment income (loss) to average net           2.87%       2.12%
     1.71%       2.80%     4.17%
        assets
                                                              82%         50%
    47%         19%          25%
Portfolio turnover rate
</TABLE>


(a)  Effect of Fund's  rights  offering  for  shares at a price  below net asset
     value.
(b)  Effect of payment  of a portion of  distributions  in newly  issued  shares
     valued at a discount from net asset value.
(c)  Calculated assuming all distributions reinvested at the actual reinvestment
     price and all primary rights exercised.



<PAGE>


                                                   SHARE PRICE DATA

     Trading in All-Star's  Shares on the NYSE  commenced on March 14, 1986. For
the two years ended  December 31, 2000 and the quarters ended March 31, 2001 and
June 30, 2001, the high and low sales prices for All-Star's  shares, as reported
in the consolidated  transaction reporting system, and the highest discount from
or  premium to net asset  value per share and the net asset  value on the day or
days when the shares traded at such high and low sales prices, were as follows:


<TABLE>

<CAPTION>

                                                                 (Discount
                               (Discount
                                                                 from) or
                               from) or
                                                                 Premium to
                               Premium to
                                   High Sales     Net Asset      Net Asset
Low Sales      Net Asset       Net Asset
1999                               Price          Value          Value
Price          Value           Value
----                               -----          -----          -----
-----          -----           -----
<S>                                <C>            <C>             <C>
<C>            <C>              <C>
1st                                $11.938        $13.35         -10.6%
$10.125        $12.22          -17.1%
Quarter...........................
2nd                                $11.500        $13.06         -11.9%
$10.375        $12.47          -16.8%
Quarter..........................
3rd                                $11.438        $12.73         -10.1%
$9.688         $11.55          -16.1%
Quarter...........................
4th                                $10.938        $13.49         -18.9%
$9.313         $11.15          -16.5%
Quarter...........................

2000
1st                                $11.563        $14.34         -19.4%
$9.875         $12.81          -22.9%
Quarter...........................
2nd                                $12.125        $14.41         -15.9%
$9.875         $12.77          -22.7%
Quarter..........................
3rd                                $12.563        $14.23         -11.7%
$11.438        $13.58          -15.8%
Quarter...........................
4th                                $12.375        $13.61         -9.1%
$9.125         $10.68          -14.6%
Quarter...........................

2001
1st                                $10.910        $10.90         0.1%
$8.00          $8.34           -4.1%
Quarter...........................
2nd                                $10.28         $9.83          1.9%
$7.95          $7.62             5.1%
Quarter..........................

</TABLE>


     All-Star's Shares have frequently traded at a discount from their net asset
value. Certain features of and steps taken by All-Star may have tended to reduce
the  discount  from net asset  value at which its Shares  might  otherwise  have
traded,  although  All-Star is not able to determine what effect,  if any, these
various  features and steps may have had.  All-Star's  current 10%  distribution
policy (see  "Distributions;  Automatic Dividend  Reinvestment and Cash Purchase
Plan-10%  Distribution  Policy"  below),  begun  in  February,  1997,  may  have
contributed  to this  effect.  This trend may also have  resulted in whole or in
part from other factors, such as the Fund's investment performance and increased
attention directed to All-Star by securities analysts and market letters.



     The net asset  value of a Share of  All-Star  on August 6, 2001 was $_____.
The last  reported  sale  price of an  All-Star  Share on that day was  $______,
representing a [discount from/premium to] net asset value of ___%.


                             INVESTMENT PERFORMANCE


     The table below shows two measures of  All-Star's  return to investors  for
the one, three and five year periods ended June 30, 2001 and from April 1, 1996
to June 30, 2001, the calendar  quarter beginning  April 1, 1996 being the
first  full  calendar  quarter  during all of which the Fund was fully
invested in accordance  with LAMCO's  multi-management methodology  (see
"History of the Fund"  below).  No. 1 ("All-Star  NAV") shows
All-Star's  investment  performance  based on a  valuation  of its Shares at net
asset value  ("NAV").  No. 2  ("All-Star  Price")  shows  All-Star's  investment
performance based on the market price of All-Star's Shares. Both measures assume
reinvestment  of all of the Fund's  dividends  and  distributions  in additional
shares pursuant to All-Star's Automatic Dividend  Reinvestment and Cash Purchase
Plan (see  "Distributions;  Automatic  Dividend  Reinvestment  and Cash Purchase
Plan" below).



     The Lipper  Multi-Cap  Growth Fund  Average  has been  included so that the
Fund's results may be compared with an unweighted average of the total return of
open-end mutual funds classified as multi-cap  growth funds (i.e.,  mutual funds
having investment  objectives and policies  comparable to All-Star) published by
Lipper Inc. The record of the NASDAQ  Composite  Index has also been included so
that  All-Star's  results may be compared  with those of an  unmanaged  group of
securities  widely regarded by investors as  representative  of growth stocks in
general.  The NASDAQ  Composite  Index is a broad based  capitalization-weighted
index of all  NASDAQ  National  Market  and Small  Cap  stocks,  and the  Lipper
Multi-Cap  Growth Fund  Average  information  reflects  the total  return of the
mutual funds  included in the average,  in each case  assuming  reinvestment  of
dividends and distributions.


<TABLE>

<S>                                       <C>                   <C>
     <C>                     <C>
                                             No. 1                  No. 2
      Lipper Multi-Cap       NASDAQ Composite
                                          All-Star NAV          All-Star Price
     Growth Fund Average           Index
                                          ------------          --------------
     -------------------           -----
1 Year                                      -24.1%                 - 9.3%
          -31.8%                  -45.5%
3 Years                                      -1.1%                   2.8%
            7.5%                    4.5%
5 Years                                       9.3%                  13.3%
           11.9%                   12.8%
Since April 1, 1996                           9.3%                  13.2%
           12.2%                   13.7%

</TABLE>


The return shown is the average annual return for the period  indicated to June
30, 2001.


     The  above  results  represent  All-Star's  past  performance  and  are not
intended as a prediction of its future  performance.  The investment return, net
asset value and market value of All-Star's  Shares will fluctuate,  so that such
Shares when sold may be worth more or less than their original cost.


                                    THE OFFER

Terms of the Offer


     All-Star is issuing to Record Date Shareholders  nontransferable  Rights to
subscribe for the Shares,  $.10 par value per Share, of the Fund's common stock.
Each such  shareholder  is being issued one Right for each Share of Common Stock
owned on the Record  Date.  The Rights  entitle the holder to acquire on Primary
Subscription at the Subscription  Price one Share for each eight Rights held. No
Rights  will  be  issued  for  fractional  shares.  Accordingly,  Shares  may be
purchased  only  pursuant to the  exercise of Rights in  integral  multiples  of
eight. Rights may be exercised at any time during the Subscription Period, which
commences on August 10, 2001 and ends at 5:00 p.m.,  New York  time, on
September
10, 2001, the Expiration Date.


     In addition,  any  shareholder  who fully  exercises  all Rights  initially
issued to him or her in the Primary  Subscription (other than those Rights which
cannot be exercised  because they  represent  the right to acquire less than one
Share) is entitled to subscribe for Shares which were not  otherwise  subscribed
for by others on Primary Subscription. For purposes of determining the number of
Shares a shareholder  may acquire  pursuant to the Offer,  broker-dealers  whose
shares are held of record on the Record Date by Cede or by any other  depository
or nominee  will be deemed to be the  holders  of the Rights  that are issued to
Cede or such  other  depository  or  nominee on their  behalf.  Shares  acquired
pursuant to the Over-Subscription  Privilege are subject to allotment,  which is
more fully discussed below under "Over-Subscription Privilege."


     The Rights are not transferable. Therefore, only the underlying Shares, and
not the Rights,  will be  admitted  for  trading on the NYSE.  Since  fractional
Shares will not be issued, shareholders who receive, or who are left with, fewer
than  eight  Rights  will be  unable to  exercise  such  Rights  and will not be
entitled to receive any cash in lieu of such fractional Shares.


     The Rights will be evidenced  by  Subscription  Certificates  which will be
mailed to Record Date  Shareholders.  Rights may be  exercised  by  completing a
Subscription  Certificate  and delivering it,  together with payment by means of
(i) a check or money  order,  or (ii) a Notice of  Guaranteed  Delivery,  to the
Subscription  Agent during the Subscription  Period.  The method by which Rights
may be  exercised  and the Shares paid for is set forth  below under  "Method of
Exercise of Rights" and "Payment for Shares."

Purpose of the Offer


     The Board of Directors of All-Star has  determined  that it would be in the
best  interests  of All-Star  and its  shareholders  to  increase  the assets of
All-Star  available for investment thereby permitting the Fund to be in a better
position  to more fully take  advantage  of  investment  opportunities  that may
arise,  and  that the  potential  benefits  of the  Offer  to  All-Star  and its
shareholders  will  outweigh  the  dilution  to  shareholders  who do not  fully
exercise  their  Rights.  The  proceeds  of the  Offer  will  enable  All-Star's
Portfolio  Managers to take  advantage  of  perceived  investment  opportunities
without having to sell existing  portfolio  holdings which they otherwise  would
retain. The Offer seeks to reward investors by giving existing  shareholders the
opportunity  to purchase  additional  Shares at a price below market  and/or net
asset value and  without  brokerage  commissions.  In  addition,  the Offer will
enhance the  likelihood  that All-Star will continue to have  sufficient  assets
remaining  after the  distributions  called for by its current 10%  distribution
policy to permit the Fund to maintain the current ratio of its fixed expenses to
its net assets.


     All-Star's Fund Manager and Portfolio  Managers will benefit from the Offer
because their fees are based on the average  weekly net assets of All-Star.  See
"Management  of All-Star."  It is not possible to state  precisely the amount of
additional compensation they will receive as a result of the Offer because it is
not known how many Shares will be subscribed for and because the net proceeds of
the  Offer  will be  invested  in  additional  portfolio  securities  that  will
fluctuate in value. Two of All-Star's Directors who voted to authorize the Offer
are  "interested  persons,"  within the meaning of the 1940 Act,  of LAMCO,  and
therefore could benefit  indirectly from the Offer. The other four Directors are
not "interested persons" of All-Star or LAMCO.


     All-Star  may,  in the  future  and  at  its  discretion,  choose  to  make
additional  rights  offerings  from time to time for a number  of shares  and on
terms  which may or may not be  similar  to the Offer.  Any such  future  rights
offering  will be made in  accordance  with the  1940  Act.  In  1998,  All-Star
completed a rights offering to shareholders of 1,314,122  additional shares at a
subscription  price of $12.41 per Share, for proceeds to the Fund of $16,222,143
after  expenses.  This rights  offering  was  oversubscribed.  Under the laws of
Maryland, the state in which the Fund is incorporated, the Board of Directors is
authorized to approve rights offerings without obtaining  shareholder  approval.
The staff of the Securities and Exchange  Commission ("SEC") has interpreted the
1940 Act as not requiring  shareholder  approval of a rights offering at a price
below the then  current net asset value so long as certain  conditions  are met,
including a good faith  determination by the fund's board of directors that such
offering would result in a net benefit to existing shareholders.


Over-Subscription Privilege

     If all of the Rights initially  issued in the Primary  Subscription are not
exercised,  any Shares for which  Subscriptions  have not been received ("Excess
Shares") will be offered, by means of the Over-Subscription Privilege, to Record
Date Shareholders who have exercised all the Rights initially issued to them and
who wish to acquire  more than the number of Shares for which the Rights  issued
to them are  exercisable.  Record Date  Shareholders who exercise all the Rights
initially  issued  to  them  will  have  the  opportunity  to  indicate  on  the
Subscription Certificate how many Shares they are willing to acquire pursuant to
the  Over-Subscription  Privilege.  If  sufficient  Excess  Shares  remain,  all
over-subscriptions  will be honored in full. If sufficient Excess Shares are not
available to honor all  over-subscriptions,  the available Excess Shares will be
allocated  (subject  to  elimination  of  fractional  shares)  among  those  who
over-subscribe  based on the number of Rights  originally  issued to them by the
Fund.  The  allocation  process may involve a series of  allocations in order to
assure  that the total  number of Shares  available  for  over-subscriptions  is
distributed on a pro rata basis.

     The  method  by which  Excess  Shares  will be  distributed  and  allocated
pursuant to the Over-Subscription Privilege is as follows. Excess Shares will be
available for purchase pursuant to the  Over-Subscription  Privilege only to the
extent  that the  maximum  number of Shares is not  subscribed  for  through the
exercise of the  Primary  Subscription  by the  Expiration  Date.  If the Excess
Shares  are  not  sufficient  to  satisfy  all  subscriptions  pursuant  to  the
Over-Subscription  Privilege,  the  Excess  Shares  will be  allocated  pro rata
(subject to the elimination of fractional  Shares) among those holders of Rights
exercising the Over-Subscription  Privilege, in proportion, not to the number of
Shares requested pursuant to the Over-Subscription  Privilege, but to the number
of shares  held on the Record  Date;  provided,  however,  that if this pro rata
allocation  results in any holder  being  allocated  a greater  number of Excess
Shares than the holder  subscribed for pursuant to the exercise of such holder's
Over-Subscription Privilege, then such holder will be allocated only such number
of Excess Shares as such holder  subscribed for and the remaining  Excess Shares
will  be  allocated  among  all  other  holders   exercising   Over-Subscription
Privileges.  The  formula  to be used in  allocating  the  Excess  Shares  is as
follows:

                  Holder's Record Date Position

                  Total Record Date PositionExcess Shares
                  of all Oversubscribers          x  Remaining

     The  allocation  process  may involve a series of  allocations  in order to
assure  that the total  number  of Shares  available  for  Over-Subscription  is
distributed  on a pro rata  basis.  The Fund will not  offer or sell any  Shares
which  are  not   subscribed   for  under  the  Primary   Subscription   or  the
Over-Subscription Privilege.

The Subscription Price


     The  Subscription  Price for the Shares to be issued pursuant to the Rights
will be 95% of the  lower  of (i) the  last  reported  sale  price of a Share of
All-Star on the NYSE on September 11, 2001 (the "Pricing Date"), or (ii) the net
asset value of a Share of All-Star on the Pricing Date.



     All-Star  announced the terms of the Offer before the opening of trading on
the NYSE on June 21,  2001.  The net asset  value per Share of  All-Star  at the
close of business on June 20, 2001 and on August [ ], 2001 was $9.09 and $_____,
respectively,  and the last  reported sale price of a Share on the NYSE on those
dates  was  $9.45  and  $______,  respectively,  representing  a 4.0% and a ___%
premium, respectively, in relation to the net asset value per Share at the close
of business on these dates.


Expiration of the Offer


     The Offer will expire at 5:00 p.m.,  New York time,  on September 10, 2001.
Rights will expire on the  Expiration  Date and thereafter may not be exercised,
unless the Offer is extended.  Since the Expiration Date is prior to the Pricing
Date,  shareholders  who decide to acquire  Shares on  Primary  Subscription  or
pursuant to the  Over-Subscription  Privilege will not know, when they make such
decision, what the purchase price for such Shares will be.



     Any extension,  termination,  or amendment of the Offer will be followed as
promptly as practicable by announcement  thereof,  such announcement in the case
of an extension to be issued no later than 9:00 a.m.,  Eastern time, on the next
business day following the previously  scheduled  Expiration Date. The Fund will
not,  unless  otherwise  required  by  law,  have  any  obligation  to  publish,
advertise, or otherwise communicate any such announcement other than by making a
release to the Dow Jones News Service or such other means of announcement as the
Fund deems appropriate.


Subscription Agent


     The  Subscription  Agent is EquiServe Trust Company,  N.A., P.O. Box 43025,
Providence,  RI  02940-3025.  EquiServe  Trust  Company  N.A. is also the Fund's
dividend paying agent, transfer agent and registrar. The Subscription Agent will
receive  from  All-Star  a  fee  estimated  to  be  no  more  than  $50,000 and
reimbursement for its out-of-pocket  expenses related to the Offer. Inquiries by
all  holders of Rights  should be  directed to P.O.  Box 43025,  Providence,  RI
02940-3025 (telephone (800) 542-3863); holders may also consult their brokers or
nominees.


Information Agent

     Any  questions  or  requests  for  assistance  regarding  the  Offer may be
directed to the  Information  Agent at its telephone  number and address  listed
below:


Georgeson Shareholder Communications Inc.
111 Commerce Road
Carlstadt, New Jersey 07072-2586



Call Toll Free (888) 420-8683



The Information Agent will receive a fee estimated at approximately $5,500 plus
reimbursement for its out-of-pocket expenses.


Method of Exercise of Rights

     Rights may be  exercised  by filling in and signing the reverse side of the
Subscription  Certificate and mailing it in the envelope provided,  or otherwise
delivering the completed and signed Subscription Certificate to the Subscription
Agent,  together with payment for the Shares as described  below under  "Payment
for Shares." Rights may also be exercised through a Rights holder's broker,  who
may charge such Rights holder a servicing fee in connection  with such exercise.
Fractional Shares will not be issued, and Rights holders who receive, or who are
left with, fewer than eight Rights will not be able to exercise such Rights.


     Completed  Subscription  Certificates and related payments must be received
by the  Subscription  Agent prior to 5:00 p.m., New York time, on the Expiration
Date (unless payment is effected by means of a notice of guaranteed  delivery as
described  below under "Payment for Shares") at the offices of the  Subscription
Agent at one of the addresses set forth below.


     The Subscription  Certificate and payment should be sent to EQUISERVE TRUST
COMPANY, N.A. by one of the following methods:

<TABLE>
<S>                               <C>
Subscription Certificate
Delivery Method                   Address
If By Mail:                       EquiServe
                                  Att: Corporate Actions
                                  P.O. Box 43025
                                  Providence, RI  02940-3025

If By Hand:                       Securities Transfer and Reporting Services,
Inc.
                                  c/o EquiServe
                                  100 Williams St. Galleria
                                  New York, NY  10038

If By Overnight Courier or        EquiServe
Express Mail:                     Attn: Corporate Actions
                                  40 Campanelli Drive
                                  Braintree, MA 02184

By Broker-Dealer or               Shareholders whose Shares are held in a
brokerage,
other Nominee:                    bank or trust account may contact their broker
or
(Notice of Guaranteed             other nominee and instruct them to submit a
Notice
Delivery)                         of Guaranteed Delivery and payment on their
                                  behalf.
</TABLE>


Delivery by any method or to any address  not listed  above will not  constitute
good delivery.

     All questions as to the validity,  form,  eligibility  (including  times of
receipt and matters  pertaining to beneficial  ownership)  and the acceptance of
subscription  forms and the  Subscription  Price will be determined by All-Star,
which  determinations will be final and binding. No alternative,  conditional or
contingent subscriptions will be accepted.  All-Star reserves the absolute right
to reject any or all subscriptions  not properly  submitted or the acceptance of
which would,  in the opinion of the Fund's counsel,  be unlawful.  All-Star also
reserves the right to waive any  irregularities  or  conditions,  and the Fund's
interpretations  of the terms  and  conditions  of the Offer  shall be final and
binding.  Any  irregularities  in connection  with  subscriptions  must be cured
within such time, if any, as the Fund shall  determine  unless  waived.  Neither
All-Star nor the Subscription Agent shall be under any duty to give notification
of defects in such subscriptions or incur any liability for failure to give such
notification.  Subscriptions  will not be deemed to have  been made  until  such
irregularities have been cured or waived.

Payment for Shares

     Holders of Rights who  subscribe  for  Shares on  Primary  Subscription  or
pursuant to the  Over-Subscription  Privilege  may choose  between the following
methods of payment:


     (1) A subscription will be accepted by the Subscription  Agent if, prior to
5:00 p.m., New York time, on the Expiration Date, the  Subscription  Agent shall
have received a notice of guaranteed delivery, by facsimile or otherwise, from a
bank or trust company or a New York Stock  Exchange or National  Association  of
Securities Dealers member firm, guaranteeing delivery of (a) payment of the full
Subscription Price for the Shares subscribed for on Primary Subscription and any
additional Shares subscribed for pursuant to the Over-Subscription Privilege and
(b) a properly completed and executed Subscription Certificate. The Subscription
Agent will not honor a notice of guaranteed delivery if a properly completed and
executed  Subscription  Certificate  and  full  payment  for the  Shares  is not
received  by the  Subscription  Agent by  September  13,  2001.  The notice of
guaranteed  delivery  may be  delivered  to the  Subscription  Agent in the same
manner as Subscription  Certificates at the addresses set forth above, or may be
transmitted to the Subscription Agent by facsimile transmission (telecopy number
(781) 575-4826; telephone number to confirm receipt (781) 575-4816).



     (2)  Alternatively,  a holder of Rights can, together with the Subscription
Certificate,  send payment for the Shares acquired on Primary  Subscription  and
any additional Shares subscribed for pursuant to the Over-Subscription Privilege
to the  Subscription  Agent based on an  estimated  purchase  price of $____ per
Share. To be accepted, such payment, together with the Subscription Certificate,
must be received by the Subscription Agent prior to 5:00 p.m., New York time, on
the Expiration Date. The  Subscription  Agent will not accept cash as a means of
payment for Shares.  Except as otherwise set forth below, a payment  pursuant to
this method must be in United States  dollars by money order or check drawn on a
bank located in the  continental  United States,  must be payable to the Liberty
All-Star  Growth  Fund,  Inc.,  and  must  accompany  an  executed  Subscription
Certificate to be accepted.



     Within ten business days following the Expiration  Date (the  "Confirmation
Date"), a  confirmation  will  be  sent  by the  Subscription  Agent  to  each
shareholder  exercising  his or her Rights  (or, if the  All-Star  Shares on the
Record Date are held by Cede or any other depository or nominee, to Cede or such
other depository or nominee), showing (i) the number of Shares acquired pursuant
to the  Primary  Subscription;  (ii) the  number  of  Shares,  if any,  acquired
pursuant  to the  Over-Subscription  Privilege;  (iii)  the per  Share and total
purchase price for the Shares;  and (iv) any  additional  amount payable by such
shareholder  to  All-Star  or any  excess to be  refunded  by  All-Star  to such
shareholder,  in each case based on the Subscription  Price as determined on the
Pricing  Date.  Any  additional  payment  required  from a  shareholder  must be
received  by the  Subscription  Agent  prior  to 5:00  p.m., New York time,  on
September  13, 2001,  and any excess  payment to be refunded by All-Star to such
shareholder will be mailed by the Subscription Agent with the confirmation.  All
payments by a  shareholder  must be in United  States  dollars by money order or
check drawn on a bank located in the United  States of America and be payable to
Liberty   All-Star  Growth  Fund,  Inc.  Such  payments  will  be  held  by  the
Subscription Agent pending completion of the processing of the subscription, and
will then be paid to All-Star.  Any interest  earned on such amounts will accrue
to All-Star and none will be paid to the subscriber.


     Whichever  of the  above two  methods  of  payment  is used,  issuance  and
delivery of the Shares  subscribed  for are subject to  collection of checks and
actual payment pursuant to any notice of guaranteed delivery.

     Rights  holders  will have no right to  rescind  their  subscription  after
receipt of their payment for Shares by the
Subscription Agent.

     If a  holder  of  Rights  who  acquires  Shares  pursuant  to  the  Primary
Subscription  or the  Over-Subscription  Privilege  does not make payment of any
amounts due,  All-Star  reserves  the right to take any or all of the  following
actions:  (i) find other  purchasers for such  subscribed and unpaid for Shares;
(ii)  apply any  payment  actually  received  by it toward the  purchase  of the
greatest  number of whole  Shares  which  could be  acquired by such holder upon
exercise of the Primary Subscription or the Over-Subscription  Privilege;  (iii)
sell in the open market all or a portion of the Shares  purchased by the holder,
and apply the proceeds to the amounts owed;  and (iv) exercise any and all other
rights or remedies to which it may be entitled,  including,  without limitation,
the right to set off against  payments  actually  received by it with respect to
such subscribed  Shares to enforce the relevant  guaranty of payment or monetary
damages.

     All-Star shareholders whose shares are held by a broker-dealer, bank, trust
company or other nominee should contact the nominee to exercise their Rights and
request  the  nominee  to  exercise  their  Rights  in  accordance   with  their
instructions.

     Brokers,  banks, trust companies,  depositories and other nominees who hold
All-Star  Shares  for  the  account  of  others  should  notify  the  respective
beneficial  owners  of such  Shares  as  soon  as  possible  to  ascertain  such
beneficial  owners'  intentions  and to  obtain  instructions  with  respect  to
exercising the Rights.  If the beneficial owner so instructs,  the record holder
of such Right should complete  Subscription  Certificates and submit them to the
Subscription Agent with the proper payment.

     The instructions  contained on the Subscription  Certificate should be read
carefully  and  followed in detail.  Do Not Send  Subscription  Certificates  to
All-Star.  (They should be sent to EquiServe  Trust  Company,  N.A. as indicated
above).


     The method of  delivery  of  Subscription  Certificates  and payment of the
Subscription Price to the Subscription Agent will be at the election and risk of
the Rights holders,  but if sent by mail it is recommended that the certificates
and payments be sent by registered mail,  properly insured,  with return receipt
requested, and that a sufficient number of days be allowed to ensure delivery to
the  Subscription  Agent and  clearance of payment  prior to 5:00 p.m.,  Eastern
time, on the Expiration Date.  Because  uncertified  personal checks may take at
least five business days to clear, you are strongly urged to pay, or arrange for
payment,  by means of a certified or cashier's check or money order. Shares will
not be delivered until checks have cleared.


Delivery of Stock Certificates


     Participants  in  All-Star's  Automatic  Dividend   Reinvestment  and  Cash
Purchase  Plan who  exercise  the  Rights  issued  on the  shares  held in their
accounts in the Plan will have their Shares acquired on Primary Subscription and
pursuant  to the  Over-Subscription  Privilege  credited  to  their  shareholder
distribution  reinvestment  accounts in the Plan.  Shareholders whose shares are
held of record by Cede or by any other  depository or nominee on their behalf or
their  broker-dealers'  behalf  will  have  their  Shares  acquired  on  Primary
Subscription  and pursuant to the  Over-Subscription  Privilege  credited to the
account of Cede or such other  depository or nominee.  With respect to all other
shareholders, stock certificates for all Shares acquired on Primary Subscription
and pursuant to the  Over-Subscription  Privilege will be mailed,  together with
the confirmation  and refund of the amount,  if any, paid in excess of the final
Subscription   Price,  on  or  about   Septermber  24,  2001  if  the  estimated
Subscription Price is equal to or in excess of the final Subscription  Price. If
the shareholder's confirmation shows that an additional amount is payable due to
the final  Subscription  Price exceeding the estimated  Subscription  Price, the
stock certificates will be mailed on or about October 4, 2001, provided that
such additional  amount has been paid and payment for the Shares  subscribed for
has cleared,  which  clearance may take up to five days from the date of receipt
of the payment.  If such payment does not clear within five  business  days from
the date of receipt, All-Star may exercise its rights in the event of nonpayment
under "Payment for Shares" above.


     Record Date  Shareholders  whose  record  addresses  are outside the United
States  will  receive  written  notice  of  the  Offer;  however,   Subscription
Certificates will not be mailed to such shareholders.  The Rights to which those
Subscription Certificates relate will be held by the Subscription Agent for such
foreign Record Date  Shareholders'  accounts until  instructions are received in
writing  with  payment to  exercise  the  Rights.  If no such  instructions  are
received by the  Expiration  Date,  such Rights will expire.  See  "Subscription
Agent".

Federal Income Tax Consequences


     The following is a general  summary of the  significant  federal income tax
consequences  of the  receipt  of  Rights  by a Record  Date  Shareholder  and a
subsequent  lapse or exercise of Rights.  The  discussion is based on applicable
provisions  of the  Internal  Revenue  Code of 1986,  as amended  ("Code"),  the
Treasury Regulations  promulgated  thereunder and other authorities currently in
effect, all of which are subject to change,  possibly with a retroactive effect.
This  discussion  does not purport to be complete or to deal with all aspects of
federal income  taxation that may be relevant to  shareholders in light of their
particular  circumstances or to shareholders  subject to special treatment under
the Code  (such  as  insurance  companies,  financial  institutions,  tax-exempt
entities,  employee benefit plans,  dealers in securities,  foreign corporations
and persons who are not U.S.  citizens or  residents),  and does not address any
state, local or foreign tax consequences.



     For federal  income tax  purposes,  neither the receipt nor the exercise of
the Rights by Record Date  Shareholders  will result in taxable  income to them,
and they will  realize no loss with  respect to any Rights that  expire  without
being exercised. All-Star will realize no gain or loss on the issuance, exercise
or expiration of the Rights.



     A Record Date Shareholder's holding period for a Share acquired on exercise
of Rights will begin with the date of exercise,  and the shareholder's basis for
determining  gain or loss on the sale of that  Share  will  equal the sum of the
shareholder's basis in the exercised Rights, if any, plus the Subscription Price
for the Share. A Record Date  Shareholder's  basis in Rights will be zero unless
either (1) the Rights' fair market value on the date of  distribution  is 15% or
more of the fair market  value on that date of the Shares with  respect to which
the Rights were  distributed or (2) the shareholder  elects,  on his, her or its
federal income tax return for the taxable year in which the Rights are received,
to allocate  part of the basis of those Shares to the Rights.  If either  clause
(1) or (2)  applies,  then if the Rights are  exercised,  the  shareholder  will
allocate  his, her or its basis in the Shares with respect which the Rights were
distributed  between  those  Shares  and  the  Rights  in  proportion  to  their
respective  fair  market  values  on  the  distribution   date.  A  Record  Date
Shareholder's  gain or loss  recognized  on  sale  of a  Share  acquired  on the
exercise of Rights will be a capital gain or loss  (assuming  the Share was held
as a capital  asset at the time of sale) and will be  long-term  capital gain or
loss,  taxable  at a  maximum  rate  of  20%  in  the  case  of  a  noncorporate
shareholder, if the shareholder then held the Share for more than one year.


Employee Benefit Plan Considerations


     Shareholders  that are  employee  benefit  plans  subject  to the  Employee
Retirement Income Security Act of 1974, as amended ("ERISA") (including separate
profit  sharing/retirement  and  savings  plans,  and  plans  for  self-employed
individuals  and their  employees) and individual  retirement  accounts  ("IRAs)
(collectively, "Retirement Plans") should be aware that additional contributions
of  cash  to  a  Retirement   Plan  (other  than   rollover   contributions   or
trustee-to-trustee  transfers from other Retirement  Plans) in order to exercise
Rights may, when taken together with  contributions  previously made, be treated
as excess or nondeductible contributions subject to excise taxes. In the case of
Retirement  Plans  qualified  under section 401(a) of the Code,  additional cash
contributions could cause violations of the maximum contribution  limitations of
section 415 of the Code or other qualification rules.  Retirement Plans in which
contributions  are so limited  should  consider  whether  there is an additional
source of funds available within the Retirement Plan,  including the liquidation
of assets,  with which to  exercise  the  Rights.  Because  the rules  governing
Retirement Plans are extensive and complex,  Retirement Plans  contemplating the
exercise of Rights should consult with their counsel prior to such exercise.


     Retirement  Plans and other  tax-exempt  entities,  including  governmental
plans,  should  also be aware that if they borrow to finance  their  exercise of
Right,  they become  subject to tax on unrelated  business  taxable income under
Section  511 of the Code.  If any  portion of an IRA is used as  security  for a
loan, that portion will be treated as a distribution to the IRA owner.


     ERISA contains  fiduciary  responsibility  requirements,  and ERISA and the
Code  contain  prohibited  transaction  rules,  that may impact the  exercise of
Rights.  Due to the complexity of these requirements and rules and the penalties
for non-compliance, Retirement Plans should consult with their counsel regarding
the consequences of their exercise of Rights under ERISA and the Code.


                     SPECIAL CONSIDERATIONS AND RISK FACTORS

Dilution

     If you do not exercise all of your Rights during the  Subscription  Period,
when the Offering is over you will own a relatively  smaller  percentage  of the
Fund if you had exercised all of your Rights. The Fund cannot tell you precisely
how much smaller the  percentage of the Fund that you would own because the Fund
does not know how many of the Fund's  Record  Date  Shareholders  will  exercise
their Rights and how many of their Rights they will exercise.

     Shareholders will experience an immediate  dilution of the aggregate NAV of
Shares as a result of the  completion of the Offer because (i) the  Subscription
Price per Share  will be less than the  Fund's  NAV per Share on the  Expiration
Date, (ii) the Fund will incur expenses in connection with the Offer,  and (iii)
the  number of Shares  outstanding  after the Offer will  increase  in a greater
percentage  than the increase in the size of the Fund's  assets.  This  dilution
also will affect  Record Date  Shareholders  to a greater  extent if they do not
exercise their Rights in full. It is not possible to state  precisely the amount
of any  decreases  in either NAV or in  ownership  interests,  because it is not
known at this time what the NAV per Share will be at the Expiration Date or what
proportion of the Shares will be subscribed. Finally, there may be a dilution of
earnings per Share due to the increase in the number of Shares outstanding,  but
only to the extent that  investments of the proceeds of the Offer do not achieve
the same  return as current  investments  held by the Fund.  To the extent  such
investments achieve a better return than current investments, earnings per Share
will experience appreciation.

     The  following  example  assumes  that  all of the  Shares  are sold at the
estimated  Subscription  Price and after  deducting all expenses  related to the
issuance of the Shares.

<TABLE>
<S>                           <C>                   <C>                     <C>
                              NAV per Share on      Dilution
Percentage
                                 _______, 2001      per Share in Dollars
Dilution

Primary Subscription
or __________ Shares                  $                      $
 %

Primary Subscription and
Oversubscription or
____________ Shares                   $                      $
 %
</TABLE>

Market Value and Net Asset Value


     The  shares  of  closed-end  investment  companies  frequently  trade  at a
discount  from net asset value.  This  characteristic  of shares of a closed-end
fund is a risk  separate  and  distinct  from the risk that the Fund's net asset
value may decrease. Since the commencement of the Fund's operations,  the Fund's
Shares have generally traded in the market at a discount to net asset value. See
"Capital  Stock." The risk of purchasing  shares of a closed-end fund that might
trade at a  discount  is more  pronounced  if you wish to sell your  shares in a
relatively short period of time. If you do so,  realization of a gain or loss on
your  investment is likely to be more  dependent upon the existence of a premium
or discount than upon portfolio  performance.  The Fund's Shares are not subject
to  redemption.   Investors   desiring  liquidity  may,  subject  to  applicable
securities  laws,  trade  their  Shares in the Fund on any  exchange  where such
Shares are then trading at current market value,  which may differ from the then
current net asset value.  Moreover,  Shareholders expecting to sell their Shares
during the course of the Offer should be aware that there is a greater risk that
the potential  discount referred to above,  which may increase during the Offer,
will adversely affect them. This increased risk is because,  among other things,
the market price per Share may reflect the anticipated dilution that will result
from this  Offer.  The Fund  cannot  predict  whether the Shares will trade at a
discount or premium to NAV after completion of the Offer.


Possible Suspension of the Offer


     All-Star  has, as  required by the  Securities  and  Exchange  Commission's
registration  form,  undertaken  to  suspend  the  Offer  until it  amends  this
Prospectus if subsequent to August [ ], 2001,  the effective  date of the Fund's
Registration  Statement,  All-Star's net asset value declines more than 10% from
its net asset value as of August [ ], 2001.  Accordingly,  All-Star  will notify
shareholders  of any such  decline  and  thereby  permit  them to  cancel  their
exercise of Rights.


                                 USE OF PROCEEDS


     The net proceeds of the Offer,  assuming that all Shares offered hereby are
sold at an assumed  Subscription  Price of $_____ per share, are estimated to be
approximately   $__________,   after  deducting  expenses  payable  by  All-Star
estimated  at  $150,000.  Such  net  proceeds  will be  invested  by  All-Star's
Portfolio  Managers  in  portfolio  securities  in  accordance  with  All-Star's
investment objective and policies. It is anticipated that investment of such net
proceeds  under  normal  market  conditions  will take place  during a period of
approximately 30 days from their receipt by All-Star,  and would in any event be
completed within three months.  Pending such investment the net proceeds will be
invested in Short-Term  Money Market  Instruments (as defined under  "Investment
Objective and Policies" below).


                               HISTORY OF THE FUND

     The Fund was  incorporated  as a Maryland  corporation on December 16, 1985
and commenced investment operations on March 14, 1986 as a closed-end management
investment  company under the name "Growth Stock Outlook Trust,  Inc." and under
the management of Growth Stock Outlook, Inc. ("GSO"), a corporation owned by Mr.
Charles  Allmon  and his wife.  In May,  1990,  the Fund's  original  investment
objective of long-term capital  appreciation  (with income being a consideration
in the selection of investments but not an investment  objective) was changed to
long-term  capital  appreciation as a primary  objective and current income as a
secondary  objective,  in each  case with an  emphasis  on the  preservation  of
capital,  and in May,  1991 the Fund's name was changed to "The  Charles  Allmon
Trust,  Inc." During GSO's management of the Fund, a substantial  portion of the
Fund's portfolio was invested in U.S. Government Securities and other short-term
cash equivalents.

     Pursuant to an Asset Acquisition and Fund Transition Agreement among LAMCO,
GSO and Mr.  Allmon,  on May 27, 1994 the Fund  entered  into a Fund  Management
Agreement with LAMCO pursuant to which LAMCO provided its multi-manager services
described  under "The  Multi-Manager  Concept"  below with respect to an initial
amount equal to 20% of the Fund's total  assets,  with GSO  continuing to manage
the remaining  80%.  LAMCO also assumed  administrative  responsibility  for the
Fund. On November 6, 1995 LAMCO assumed investment management responsibility for
100% of the Fund's  assets,  the Fund's name was  changed to  "Liberty  All-Star
Growth Fund, Inc.," the Fund's investment objective was returned to the original
objective of long-term capital appreciation, eliminating the secondary objective
of current income and the emphasis on  preservation  of capital,  and the Fund's
Board of Directors was reconstituted. The approximately 79% of the Fund's assets
then being managed by GSO, over 80% of which had been invested in U.S.  Treasury
bills and other short-term cash equivalents, was assigned in substantially equal
portions to the Fund's then three Portfolio  Managers under LAMCO's  supervision
and within three months was substantially fully invested in equity securities in
accordance with their respective investment styles.

                            THE MULTI-MANAGER CONCEPT

     All-Star  allocates its portfolio  assets on an  approximately  equal basis
among  a  number  of  independent   investment   management  firms   ("Portfolio
Managers"),  currently  three in  number,  recommended  by LAMCO,  each of which
employs a  different  investment  style,  and from time to time  rebalances  the
portfolio among the Portfolio Managers so as to maintain an approximately  equal
allocation of the portfolio among them throughout all market cycles.

     In the opinion of LAMCO, the multi-manager concept provides advantages over
the use of a single manager because of the following primary factors:

     (i) most equity investment management-firms  consistently employ a distinct
investment   style  which  causes  them  to  emphasize  stocks  with  particular
characteristics;

     (ii) because of changing investor  preferences,  any given investment style
will  move into and out of market  favor  and will  result in better  investment
performance  under certain  market  conditions but less  successful  performance
under other conditions;

     (iii) consequently,  by allocating All-Star's portfolio on an approximately
equal basis among Portfolio Managers  employing  different styles, the impact of
any one such style on investment performance will be diluted, and the investment
performance  of the total  portfolio  will be more  consistent and less volatile
over the long-term  than if a single style were employed  throughout  the entire
period;

     (iv)  consistent  performance  at a given  annual  rate of return over time
produces  a  higher  rate  of  return  for  the  long-term  than  more  volatile
performance having the same average annual rate of return.

     LAMCO, based on the foregoing principles and on its analysis and evaluation
of information  regarding the personnel and investment styles and performance of
a universe of numerous  professional  investment  management firms, has selected
for  appointment  by  All-Star  a group of  Portfolio  Managers  representing  a
blending of different investment styles which, in its opinion, is appropriate to
All-Star's investment objective.

     LAMCO  continuously  monitors  the  performance  and  investment  styles of
All-Star's  Portfolio  Managers  and from  time to time  recommends  changes  of
Portfolio  Managers  based on factors  such as changes in a Portfolio  Manager's
investment style or a departure by a Portfolio Manager from the investment style
for  which  it had been  selected,  a  deterioration  in a  Portfolio  Manager's
performance  relative to that of other investment  management firms practicing a
similar  style,  or adverse  changes in its  ownership or  personnel.  Portfolio
Manager changes may also be made to change the mix of investment styles employed
by  All-Star's  Portfolio  Managers.  Since  LAMCO's  assumption  of  management
responsibilities for the Fund in May, 1994 (see "History of the Fund"), All-Star
has had four Portfolio Manager changes.

     All-Star Portfolio Manager changes, as well as the periodic rebalancings of
its  portfolio  among  the  Portfolio  Managers  and the need to raise  cash for
All-Star's  quarterly  distributions,  may result in some portfolio  turnover in
excess of what would otherwise be the case (see "Financial  Highlights"  above).
Increased portfolio turnover would cause increased brokerage commission costs to
All-Star,  and may result in greater  realization  of capital  gains,  which are
taxable to shareholders.

     Under the terms of an  exemptive  order issued to All-Star and LAMCO by the
Securities and Exchange Commission,  a portfolio management agreement with a new
or additional  Portfolio  Manager may be entered into in advance of  shareholder
approval,  provided  that the new  agreement  is at a fee no  higher  than  that
provided  in, and is on other  terms and  conditions  substantially  similar to,
All-Star's   agreements  with  its  other  Portfolio  Managers,   and  that  its
continuance  is subject to  approval by  shareholders  at  All-Star's  regularly
scheduled annual shareholder meeting (normally held in April) next following the
date of the new or additional portfolio management agreement.  Information about
Portfolio  Manager changes or additions made in advance of shareholder  approval
will be announced to the press following  Board of Directors  action and will be
included in the next report to shareholders.

     All-Star's current Portfolio Managers are:

         William Blair & Company, L.L.C.
         TCW Investment Management Company
         M.A. Weatherbie & Co., Inc.

     See Appendix A for information  about these Portfolio  Managers,  including
the employees primarily responsible for the day-to-day management of the portion
of All-Star's portfolio allocated to each.

                    INVESTMENT OBJECTIVE, POLICIES AND RISKS

     All-Star's  investment objective is to seek long-term capital appreciation.
It seeks its investment  objective through investment primarily in a diversified
portfolio  of equity  securities.  See "History of the Fund" above for its prior
investment objectives.

     All-Star invests primarily (at least 65% under normal market conditions) in
equity  securities,  including  securities  convertible into or exchangeable for
equity securities.

     Although under normal market conditions All-Star will remain  substantially
fully invested in equity securities,  up to 35% of the value of All-Star's total
assets may generally be invested in obligations  of the U.S.  Government and its
agencies  and  instrumentalities  ("U.S.  Government  Securities"),   repurchase
agreements  with respect to U.S.  Government  Securities,  and, to an extent not
greater than 10% of the market value of the Fund's  total  assets,  money market
mutual funds that invest primarily in U.S. Government  Securities.  All-Star may
temporarily  invest  without  limit in U.S.  Government  Securities,  repurchase
agreements  and money market mutual funds for  defensive  purposes when LAMCO or
the  Portfolio  Managers  deem  that  market  conditions  are  such  that a more
conservative approach to investment is desirable.

     All-Star's investment objective of long-term capital appreciation,  as well
as certain of its investment  restrictions referred to under Reducing Risk below
and in the Statement of Additional  Information,  are fundamental and may not be
changed without a majority vote of All-Star's outstanding shares. Under the 1940
Act, a "majority  vote" means the vote of the lesser of (a) 67% of the shares of
All-Star  represented  at a meeting at which the holders of more than 50% of the
outstanding shares of All-Star are present or represented,  or (b) more than 50%
of the outstanding shares of All-Star.  Non-fundamental  policies may be changed
by vote of the Board of Directors.

Repurchase Agreements

     All-Star may enter into repurchase  agreements with banks or  broker-dealer
firms whereby such institutions sell U.S. Government  Securities to All-Star and
agree at the time of sale to repurchase  them at a mutually agreed upon time and
price.  The resale  price is greater  than the  purchase  price,  reflecting  an
agreed-upon  interest  rate  which is  effective  during  the time  between  the
purchase  and resale  and is not  related  to the  stated  interest  rate on the
purchased securities. All-Star requires the seller of the securities to maintain
on deposit with  All-Star's  custodian bank securities in an amount at all times
equal to or in  excess of the value of the  repurchase  agreement.  In the event
that the seller of the  securities  defaults  on its  repurchase  obligation  or
becomes  bankrupt,  All-Star could receive less than the repurchase price on the
sale of the  securities  to  another  party or could be  subjected  to delays in
selling the  securities.  Under normal market  conditions,  not more than 35% of
All-Star's total assets will be invested in Short-Term Money Market Instruments,
including repurchase agreements,  and not more than 10% of All-Star's net assets
will be invested in repurchase agreements maturing in more than seven days.

Foreign Securities

     All-Star  may  invest  up to 25%  percent  of its  net  assets  in  foreign
securities,  provided  that it will not  purchase  the  securities  of a foreign
issuer  if as a  result  more  than  50% of the  Fund's  investments  in  equity
securities  would consist of securities of foreign issuers.  All-Star  presently
does not  intend to invest  10% or more of its  assets  in  foreign  securities.
Investment in foreign securities involves considerations and risks not typically
associated with investing in securities of domestic  companies.  See "Investment
Objectives  and  Policies--Foreign  Securities"  in the  Statement of Additional
Information.

Risks

     As an investment company that holds common stocks,  All-Star's portfolio is
subject to the  possibility  that common stock prices will decline over short or
even extended periods.  All-Star may remain  substantially fully invested during
periods  when stock  prices  generally  rise and also during  periods  when they
generally  decline.  Risks are inherent in  investments  in  equities,  and Fund
shareholders should be able to tolerate significant fluctuations in the value of
their investment in All-Star.  All-Star is intended to be a long-term investment
vehicle and is not designed to provide  investors with a means of speculating on
short-term  stock  market  movements.  Investors  should not consider the Fund a
complete investment program.

     In  addition  to the  foregoing  investment  risks,  shares  of  closed-end
investment companies such as All-Star are not redeemable and frequently trade at
a discount  from their net asset value.  This risk is separate and distinct from
the risk that All-Star's net asset value may decline. See "Share Price Data" for
information  about the market  price and net asset  value of  All-Star's  shares
since January 1, 1999.


Reducing Investment Risk

     As a matter of fundamental policy,  All-Star will not (i), as to 75% of its
total assets, purchase the securities (other than U.S. Government Securities) of
any one  issuer  if after  such  purchase  more than 5% of its  assets  would be
invested in the  securities  of that issuer,  (ii) purchase more than 10% of the
outstanding voting securities of such issuer, (iii) invest 25% more of its total
assets in the  securities of issuers in the same  industry,  or (iv) invest more
than 10% of its total  assets in  securities  that at the time of purchase  have
legal or contractual  restrictions on resale (including  unregistered securities
that are eligible for resale to qualified  institutional buyers pursuant to Rule
144A under the Securities Act of 1933).  See  "Investment  Restrictions"  in the
Statement of Additional Information.

                             MANAGEMENT OF ALL-STAR

     The management of All-Star's  business and affairs is the responsibility of
its Board of Directors.


     All-Star has a Fund  Management  Agreement  with Liberty  Asset  Management
Company  (the "Fund  Manager" or "LAMCO")  pursuant to which LAMCO  provides the
Portfolio Manager  selection,  evaluation,  monitoring and rebalancing  services
("investment  management  services")  described  above under "The  Multi-Manager
Concept." No single  individual at LAMCO is  responsible  for LAMCO's  decisions
with respect to the retention or replacement of the Portfolio Managers.


     LAMCO is also responsible for the provision of  administrative  services to
All-Star, including the provision of office space, shareholder and broker-dealer
communications,  compensation  of  officers  of  All-Star  who are  officers  or
employees of LAMCO or its affiliates,  and the  supervision of transfer  agency,
dividend disbursing, custodial and other services provided to others. Certain of
LAMCO's administrative responsibilities have been delegated to Colonial.

     LAMCO has its  offices at  Federal  Reserve  Plaza,  600  Atlantic  Avenue,
Boston, Massachusetts 02210-2214. LAMCO was organized in 1985 and is an indirect
wholly-owned  subsidiary of Liberty Financial Companies,  Inc., which in turn is
an indirect  majority-owned  subsidiary of Liberty Mutual Insurance Company,  an
international multi-line insurance carrier.

     On June 4, 2001 Liberty  Financial  announced  that Fleet National Bank has
agreed to acquire  Liberty  Financial's  asset  management  business,  including
LAMCO. Fleet National Bank is an indirect wholly-owned subsidiary of FleetBoston
Financial  Corporation,  a U.S.  financial  holding company.  The closing of the
proposed  transaction  is expected to take place  during the second half of 2001
and is subject to a number of conditions, including approval by the shareholders
of Liberty Financial.


     Under All-Star's Portfolio Management Agreements with each of its Portfolio
Managers  and  LAMCO,  each  Portfolio   Manager  has  discretionary   authority
(including  for the  selection  of brokers  and  dealers  for the  execution  of
All-Star's  portfolio  transactions)  with respect to the portion of  All-Star's
assets  allocated  to it by LAMCO  from  time to  time,  subject  to  All-Star's
investment  objective  and  policies,  to the  supervision  and  control  of the
Directors,  and to  instructions  from  LAMCO.  As  described  under the section
entitled  "The  Multi-Manager  Concept",  LAMCO  from  time to time  reallocates
All-Star's  portfolio  assets  in  order  to  maintain  an  approximately  equal
allocation of them among the Portfolio Managers and to preserve an approximately
equal weighting among the different investment styles practiced by the Portfolio
Managers.  Although the Portfolio  Managers'  activities  are subject to general
oversight by LAMCO and the Directors and officers of All-Star, neither LAMCO nor
such  Directors  and officers  evaluate the  investment  merits of the Portfolio
Managers' selections of individual securities.  See Appendix A for a description
of the Portfolio Managers.


     Although  All-Star  does not  permit a  Portfolio  Manager to act or have a
broker-dealer  affiliate act as broker for Fund portfolio transactions initiated
by  it,  All-Star's   Portfolio   Managers  are  permitted  to  place  portfolio
transactions   initiated  by  them  with  another   Portfolio   Manager  or  its
broker-dealer   affiliate  for  execution  on  an  agency  basis,  provided  the
commission  does not exceed the usual and customary  broker's  commission  being
paid to other brokers for comparable transactions and is otherwise in accordance
with All-Star's procedures adopted under Rule 17e-1 under the 1940 Act.

     Under  All-Star's  Fund  Management  Agreement with LAMCO and its Portfolio
Management  Agreements with the Portfolio  Managers,  All-Star pays LAMCO a fund
management fee and an administrative fee, and LAMCO in turn pays the fees of the
Portfolio  Managers  from the fund  management  fees paid to it. The annual fees
that are paid under the  current  agreements  are shown  below (fees are payable
quarterly  based on the indicated  percentage of the Fund's  average  weekly net
assets during the prior quarter).


<TABLE>
<S>                        <C>                                       <C>
          <C>
                           Fund Management
                           Fee Paid to LAMCO
                           and Portfolio Management
 Average weekly            Fee Paid to
Administrative
 Net Asset Value           Portfolio Managers                        Fee Paid to
LAMCO     Total Fees
----------------           ------------------
-----------------     ----------
 First $300 million        0.80% (0.40% to Portfolio Managers)       0.20%
          1.00%
 Over $300 million         0.72% (0.36% to Portfolio Managers)       0.18%
          0 90%
</TABLE>


     Colonial  provides  pricing and  bookkeeping  services  to All-Star  for an
annual  fee of $10,000 per year plus a fee based on of the Fund's average
net assets for any month that such assets are over $50 million.  The fee shall
be calculated as follows:  $190,000 divided by the sum of the Fund's average
monthly net assets plus the average monthly net assets of Liberty All-Star
Equity Fund. The Fund also reimburses Colonial for its out-of-pocket expenses,
including fees payable to third parties for pricing services.


Custodian and Transfer Agent

     JP Morgan Chase and Company,  270 Park Avenue, New York, New York 10017, is
All-Star's custodian.  EquiServe Trust Company, N.A., 150 Royall Street, Canton,
Massacusetts  02021, is the transfer and dividend disbursing agent and registrar
for All-Star.

Expenses of the Fund

     LAMCO provides the Portfolio Manager selection, evaluation,  monitoring and
rebalancing services and assumes responsibility for the administrative  services
described  above,  pays the  compensation of and furnishes  office space for the
officers of All-Star who are affiliated with LAMCO, and pays the management fees
of the Portfolio  Managers.  All-Star  pays all its  expenses,  other than those
expressly assumed by LAMCO. The expenses payable by All-Star include: management
and administrative  fees payable to LAMCO;  pricing and bookkeeping fees payable
to Colonial;  fees and expenses of independent auditors; fees for transfer agent
and  registrar,  dividend  disbursing,  custodian  and  portfolio  recordkeeping
services;  expenses in connection with the Automatic  Dividend  Reinvestment and
Cash  Purchase  Plan;  expenses in  connection  with  obtaining  quotations  for
calculating  the  value  of  All-Star's  net  assets;  taxes  (if  any)  and the
preparation of All-Star's tax returns; brokerage fees and commissions; interest;
costs of director and shareholder  meetings  (including expenses of printing and
mailing proxy material  therefor);  expenses of printing and mailing  reports to
shareholders; fees for filing reports with regulatory bodies and the maintenance
of All-Star's  existence;  membership dues for investment company industry trade
associations;  legal fees;  stock  exchange  listing fees and expenses;  fees to
federal and state authorities for the registration of shares;  fees and expenses
of Directors who are not directors, officers, employees or stockholders of LAMCO
or its affiliates;  insurance and fidelity bond premiums;  and any extraordinary
expenses of a non-recurring nature.

                              DESCRIPTION OF SHARES

General


     All-Star's  authorized  capitalization  consists  of  60,000,000  Shares of
common stock, par value $.10 per Share, of which  16,942,250  Shares were issued
and outstanding on the date of this Prospectus. The currently outstanding Shares
are,  and the Shares  offered  hereby when  issued and paid for  pursuant to the
terrns of the Offer will be, fully paid and  non-assessable.  Shareholders would
be  entitled  to share pro rata in the net  assets  of  All-Star  available  for
distribution to shareholders upon liquidation of All-Star.



     Shareholders  are  entitled  to one vote for each  Share  held.  All-Star's
Shares do not have  cumulative  voting  rights,  which means that the holders of
more than 50% of the Shares of All-Star voting for the election of Directors can
elect all the Directors  standing for election,  and, in such event, the holders
of the remaining Shares will not be able to elect any of such Directors.


Repurchase of Shares


     All-Star is a closed-end investment company and as such its shareholders do
not have the right to cause All-Star to redeem their All-Star Shares.  All-Star,
however,  is  authorized  to  repurchase  its Shares on the open market when its
Shares are trading at a discount  from their net asset  value.  All-Star  has no
current plans to repurchase its Shares.



Anti-takeover   Provisions  of  the  Articles  of  Incorporation   and  By-Laws;
Super-majority Vote Requirement for Conversion to Open-End Status


     All-Star's   Articles  of  Incorporation  and  By-laws  contain  provisions
(commonly  referred to as "antitakeover"  provisions) which are intended to have
the  effect of  limiting  the  ability of other  entities  or persons to acquire
control of All-Star, to cause it to engage in certain transactions, or to modify
its structure. The Board of Directors is divided into three classes, each having
a term of three years. On the date of the annual meeting of shareholders in each
year the term of one class  expires.  This  provision  could delay for up to two
years the replacement of a majority of the Board of Directors.  In addition, the
affirmative  vote of the  holders  of 66 2/3% of the  Shares of the Fund will be
required generally to authorize any of the following transactions:


(i)  All-Star's merger or consolidation with or into any other corporation;

(ii) the  issuance  of any  securities  of  All-Star to any person or entity for
     cash;

(iii)the sale,  lease or exchange of all or any  substantial  part of All-Star's
     assets to any entity or person  (except  assets  having an  aggregate  fair
     market value of less than $1,000,000); or

(iv) the sale,  lease or exchange to  All-Star,  in exchange for  securities  of
     All-Star,  of any assets of any entity or person  (except  assets having an
     aggregate fair market value of less than $1,000,000);

if such  corporation,  person or  entity  is  directly,  or  indirectly  through
affiliates,  the  beneficial  owner of five  percent or more of the  outstanding
shares of All-Star.  Such 66 2/3% vote will not be required  with respect to the
transactions listed in (i) through (iv) above where the Board of Directors under
certain  conditions  approves  the  transaction.  However,  depending  upon  the
transaction,  a different  shareholder  vote may  nevertheless be required under
Maryland law.


     The  affirmative  vote of the holders of 66 2/3% percent of the outstanding
Shares will be required to authorize All-Star's  conversion from a closed-end to
an open-end investment company.


     The foregoing  super-majority  vote  requirements may not be amended except
with a similar supermajority vote of the shareholders.

     These provisions will make more difficult a change in All-Star's  structure
or  management  or  consummation  of  the  foregoing  transactions  without  the
Directors'  approval.  The  anti-takeover  provisions  could  have the effect of
depriving  shareholders of an opportunity to sell their shares at a premium over
prevailing  market prices by  discouraging  a third party from seeking to obtain
control of All-Star in a tender offer or similar transaction. However, the Board
of Directors  continues to believe that the anti-takeover  provisions are in the
best  interests  of  All-Star  and its  shareholders  because  they  provide the
advantage  of  potentially  requiring  persons  seeking  control of  All-Star to
negotiate  with its management  regarding the price to be paid and  facilitating
the continuity of All-Star's  management  and its continuing  application of the
multi-manager concept.

     The Board  also  believes  that the  super-majority  vote  requirement  for
conversion to an open-end investment company is in the best interest of All-Star
and its shareholders  because it will allow All-Star to continue to benefit from
the  advantages  of its  closed-end  structure  until such time  that,  based on
relevant factors including the then current  relationship of the market price of
All-Star's shares to their net asset value, the Board determines to recommend to
shareholders All-Star's conversion to an open-end investment company.

                        DISTRIBUTIONS; AUTOMATIC DIVIDEND
                       REINVESTMENT AND CASH PURCHASE PLAN

10% Distribution Policy


     All-Star's current distribution policy,  announced in February, 1997, is to
pay  distributions  on its Shares totalling  approximately  10% of its net asset
value per year, payable in four quarterly distributions of 2.5% of its net asset
value at the close of the NYSE on the Friday prior to each quarterly declaration
date.  These  fixed  distributions,  which are not  related  to  All-Star's  net
investment  income or net realized  capital gains or losses,  will be treated as
ordinary dividend income up to the amount of All-Star's  current and accumulated
earnings and profits.  If, for any calendar year, the total  distributions  made
under the 10% pay-out policy exceed  All-Star's  net  investment  income and net
realized  capital  gains,  the excess  will be  treated as a tax-free  return of
capital to each shareholder (up to the amount of the shareholder's  basis in his
or her  shares)  and  thereafter  as gain from the sale of  Shares.  The  amount
treated as a tax-free return of capital will reduce the  shareholder's  adjusted
basis in his or her Shares,  thereby  increasing  his or her  potential  gain or
reducing his or her potential loss on the subsequent  sale of his or her shares.



     To the extent  All-Star's  10% payout policy  results in  distributions  in
excess  of its net  investment  income  and net  realized  capital  gains,  such
distributions will decrease its total assets and increase its expense ratio to a
greater extent than would have been the case without the 10% payout  policy.  In
addition,  in order to make distributions under the 10% payout policy,  All-Star
may have to sell portfolio  securities at times when the  particular  investment
styles of its Portfolio Managers would dictate not doing so.



     All-Star  may,  in the  discretion  of the Board of  Directors,  retain for
reinvestment,  and not  distribute,  net capital gain for any year to the extent
that its net investment  income and net realized gains exceed the minimum amount
required to be distributed for such year under the 10% pay-out policy,  although
All-Star reserves the right to distribute such excess. Retained net capital gain
will be taxed to both All-Star and the shareholders as long-term  capital gains;
however,  each  shareholder  will be able to claim a proportionate  share of the
federal  income tax paid by All-Star as a credit  against his or her own federal
income tax  liability and will be entitled to increase the adjusted tax basis in
his or her Shares by the difference between the amount taxed and the credit.



     All-Star intends to pay all or a substantial  portion of its  distributions
in each  year in the  form of  newly  issued  Shares  (plus  cash in lieu of any
fractional  Shares that would otherwise be issuable) to all shareholders  except
those  non-participants  in the Plan who  specifically  elect to  receive  their
distribution  in cash by completing  and signing an option card, a copy of which
will be enclosed  with the notice of each such  distribution  payable in Shares,
and returning it on a timely basis to EquiServe Trust Company,  N.A., All-Star's
transfer agent and dividend paying agent.



     The  number  of  Shares  to be issued  to a  shareholder  in  payment  of a
distribution declared payable in shares will be determined by dividing the total
dollar  amount of the  distribution  by the lower of the market value or the net
asset value per Share on the valuation date for the  distribution  (but not at a
discount of more than 5% from the market value). Market value per Share for this
purpose  will be the last sales price on the NYSE on the  valuation  date or, if
there are no sales on that day,  the mean  between  the  closing bid and closing
asked quotations for that date.


Automatic Dividend Reinvestment and Cash Purchase Plan


     Each  shareholder  of the Fund will  automatically  be a participant in the
Plan, unless the shareholder specifically elects otherwise by writing or calling
the  Plan  Agent,   EquiServe  Trust  Company,  N.A.,  P.O.  Box  8200,  Boston,
Massachusetts 02266-8200 (1-800-542-3863). Shareholders whose Shares are held in
the name of a brokerage  firm, bank or other nominee must notify their brokerage
firm,  bank  or  nominee  if  they  do not  want  to  participate  in the  Plan.
Shareholders who want to receive their distributions in cash should elect not to
participate  in the Plan  and,  as noted  above,  will be  required  to elect to
receive in cash each distribution declared payable in Shares or cash.



     Under the Plan,  distributions  declared  payable  in Shares or cash at the
option of  shareholders  are paid to  participants in the Plan entirely in newly
issued full and fractional shares valued at the lower of the market value or the
net asset value per share on the valuation date for the distribution  (but not a
discount of more than 5% from the market value).  Distributions declared payable
in cash will be  reinvested  for the  accounts  of  participants  in the Plan in
additional Shares purchased by the Plan Agent on the open market, on the NYSE or
elsewhere at  prevailing  market  prices (if the Fund's  shares are trading at a
discount  to their net asset  value) or in newly  issued  Shares  (if the Fund's
Shares  are  trading  at  or  above  their  net  asset  value).   Dividends  and
distributions  are subject to  taxation,  whether  received in cash or in Shares
(see "Tax Status" below).



     Participants in the Plan have the option of making additional cash payments
in any amount from $100 to $3,000 on a monthly basis for  investment in All-Star
Shares  purchased on the open market.  These  voluntary  cash  payments  will be
invested on or about the 15th day of each calendar month, and voluntary payments
should be sent so as to be received by the Plan Agent no later than ten business
days before the next investment date. Barring  suspension of trading,  voluntary
cash payments  will be invested  within 45 days of receipt.  A  participant  may
withdraw a voluntary cash payment by written  notice  received by the Plan Agent
at least 48 hours before such payment is to be invested.



     The Plan Agent maintains all shareholder accounts in the Plan and furnishes
written confirmations of all transactions in the account,  including information
needed by  shareholders  for tax  records.  Shares in the  account  of each Plan
participant will be held by the Plan Agent in non-certificated  form in the name
of the  participant,  and each  shareholder's  proxy will  include  those Shares
purchased or received pursuant to the Plan.



     In the case of  shareholders  such as banks,  brokers or nominees that hold
Shares for others who are the beneficial  owners, the Plan Agent will administer
the Plan on the basis of the number of Shares certified from time to time by the
record  shareholder as  representing  the total amount  registered in the record
shareholder's name and held for the account of beneficial owners who participant
in the Plan.



     There is no charge to participants for reinvesting distributions payable in
either Shares or cash.  The Plan Agent's fees for handling the  reinvestment  of
such  distributions  are paid by All-Star.  There are no brokerage  charges with
respect to Shares  issued  directly  by  All-Star  as a result of  distributions
payable in shares or in cash.  However,  each participant bears a pro rata share
of brokerage  commissions  incurred with respect to the Plan Agent's open market
purchases in connection with the reinvestment of distributions  declared payable
in cash.



     With respect to purchases from voluntary cash payments, the Plan Agent will
charge $1.25 for each such purchase for a participant,  plus a pro rata share of
the brokerage  commissions.  Brokerage  charges for purchasing  small amounts of
shares for individual accounts through the Plan are expected to be less than the
usual  brokerage  charges  for  such  transactions,  as the Plan  Agent  will be
purchasing  shares  for all  participants  in  blocks  and  prorating  the lower
commission thus attainable.



     The automatic  reinvestment of dividends and other  distributions  will not
relieve plan  participants  of any income tax that may be payable  thereon.  See
"Tax Status" below.


     A participant  may elect to withdraw from the Plan at any time by notifying
the Plan Agent in  writing.  There will be no penalty  for  withdrawal  from the
Plan, and shareholders who have previously withdrawn from the Plan may rejoin it
at any time. A withdrawal  will only be effective for  subsequent  distributions
with a record date at least ten days after the notice of  withdrawal is received
by the Plan Agent.

     Experience  under  the  Plan  may  indicate  that  changes  are  desirable.
Accordingly, All-Star reserves the right to amend or terminate the Plan.

                                   TAX STATUS


     The following discussion briefly summarizes the general rules applicable to
taxation of All-Star  and its  shareholders.  Shareholders  are urged to consult
with their own tax advisers  concerning the tax  consequences of their continued
investment in All-Star and of their receipt and exercise of the Rights.



     All-Star  has elected to be, and  intends to continue to qualify  each year
for federal  income tax  treatment as a regulated  investment  company under the
Code, and intends to make  distributions  to the shareholders in accordance with
the timing  requirements  set out in the Code. As a result,  it is expected that
All-Star will be relieved of federal income tax on its net investment income and
net  realized   capital  gains  to  the  extent  it  distributes   them  to  its
shareholders.  (See  "Distributions;  Automatic  Dividend  Reinvestment and Cash
Purchase Plan--10% Distribution Policy" regarding All-Star's authority to retain
and pay taxes on, and not distribute,  net capital gain). All-Star also expects
to  make  sufficient   annual   distributions   to  avoid  being  subject  to  a
nondeductible 4% federal excise tax imposed on regulated  investment  companies.
If All-Star fails to qualify as a regulated  investment  company in any year, it
would  incur  federal  corporate  income  tax  on its  taxable  income  and  its
distributions  would be taxable as ordinary  dividend income to the shareholders
to the extent of its net  investment  income and net capital  gain. In addition,
All-Star could be required to recognize  unrealized gains, pay substantial taxes
and  interest  and  make  substantial   distributions  before  requalifying  for
treatment as a regulated investment company.



     Distributions  by  All-Star  from net  investment  income and net  realized
capital gains are subject to taxation  whether  received by shareholders in cash
or  in  Shares  of  All-Star.   Shareholders   receiving  a  dividend  or  other
distribution  in the form of newly  issued  Shares  will be treated  for federal
income tax purposes as receiving a  distribution  in an amount equal to the fair
market value,  determined as of the  distribution  date, of the Shares received.
Such shareholders will have a cost basis in each newly issued Share equal to the
fair market value of a Share of All-Star on the distribution date. Distributions
are  generally  taken into  account  for tax  purposes  when paid,  except  that
distributions  paid in January but declared in the last quarter of the preceding
calendar  year must be taken  into  account  as if paid on  December  31 of such
preceding  calendar year. A portion of All-Star's net investment  income paid to
corporate   shareholders   that  is  attributable  to  dividends  from  domestic
corporations may be eligible for the 70% dividends-received  deduction available
to  corporations.   Availability  of  the  deduction  for  particular  corporate
shareholders  is subject to certain  limitations,  and  deducted  amounts may be
subject to the alternative  minimum tax or result in certain basis  adjustments.
Distributions  from net capital  gain are taxable as  long-term  capital  gains,
regardless of how long the shareholder has held the Shares, and are not eligible
for the dividends-received  deduction.  Net capital gain is taxable, in the case
of a noncorporate  shareholder,  at a maximum rate of 20% if attributable to the
disposition of shares that the shareholder held for more than twelve months.



     If a shareholder  holds Shares of All-Star for six months or less, any loss
on the sale of the Shares  will be treated as a  long-term  capital  loss to the
extent of any amount  reportable by the  shareholder  as long-term  capital gain
with respect to such Shares.  Any loss realized on a  disposition  of Shares may
also be disallowed under rules relating to wash sales.



     At the time of an investor's  purchase of All-Star  Shares,  All-Star's net
asset value may reflect  undistributed net investment income or capital gains or
net  unrealized  appreciation  of  securities it holds.  As of _________,  2001,
All-Star's  investments had net unrealized losses of $____ million.  Realization
and a subsequent  distribution to a shareholder of such amount,  although it may
in effect constitute a return of his or her investment,  would be taxable to the
shareholder as ordinary income or capital gain, as described  above. For federal
income tax purposes,  All-Star is permitted to carry forward to another  taxable
year its net realized  capital  losses,  if any, from earlier  taxable years and
thus may realize  net  capital  gains in the later year up to the amount of such
losses without being required to pay taxes on or to distribute such gains. As of
December 31, 2000,  the end of its last completed  fiscal year,  All-Star had no
capital loss carryovers.



     Individuals and certain other  non-corporate  All-Star  shareholders may be
subject  to  30.5%   withholding  on  reportable   dividends  and  capital  gain
distributions  ("back-up  withholding").   Generally,  shareholders  subject  to
back-up withholding will be those for whom a taxpayer  identification number and
certain  required  certificates  are  not on  file  with  All-Star  or  who,  to
All-Star's knowledge, have furnished an incorrect number. In addition,  All-Star
is required to  withhold  from  distributions  to any  shareholder  who does not
certify to All-Star that the  shareholder is not subject to back-up  withholding
due to  notification  by the Internal  Revenue  Service that the shareholder has
under-reported interest or dividend income.



     Distributions  from net  investment  income  paid to  shareholders  who are
non-resident   aliens  or  foreign  entities  may  be  subject  to  30%  federal
withholding tax (but not, in such event,  subject to back-up withholding) unless
a reduced rate of  withholding  or a withholding  exemption is provided under an
applicable  treaty.  Non-U.S.  shareholders  are urged to consult  their own tax
advisers concerning the applicability of the withholding tax.



     Information  concerning the federal income tax status of All-Star dividends
and other distributions is mailed to shareholders annually.



     Distributions and the transactions  referred to in the preceding paragraphs
may be subject to state and local income taxes,  and the  treatment  thereof may
differ from the federal income tax consequences  discussed herein.  Shareholders
are advised to consult with their tax advisers  concerning  the  application  of
state and local taxes.



     See "The  Offer-Federal  Income Tax  Consequences"  for a discussion of the
federal income tax consequences regarding the Rights.


                                     GENERAL

     Under the Fund Management  Agreement  between All-Star and LAMCO,  All-Star
may use the  name  "Liberty  All-Star"  only  so  long  as the  Fund  Management
Agreement  remains in effect.  If the Fund Management  Agreement is no longer in
effect,  All-Star is  obligated  (to the extent it lawfully  can) to cease using
such  name or any other  name  indicating  that it is  advised  by or  otherwise
connected with LAMCO. In addition,  LAMCO may grant the  non-exclusive  right to
use the name  "Liberty  All-Star"  to any  other  entity,  including  any  other
investment  company of which LAMCO or any of its  affiliates  is the  investment
adviser or distributor.




                       STATEMENT OF ADDITIONAL INFORMATION

     Additional  information  about the Fund is  contained  in the  Statement of
Additional Information, a copy of which is available at no charge by calling the
Information  Agent  at  the  telephone  number  indicated  on the  cover  of the
Prospectus.  Set  forth  below is the  Table of  Contents  of the  Statement  of
Additional Information.

                                Table of Contents

Investment Objective and
Policies.....................................................................2.
Investment
Restrictions.................................................................2
Investment Advisory and Other
Services.....................................................................4
Directors and Officers of
All-Star.....................................................................5
Portfolio Security
Transactions................................................................11
Principal
Shareholders................................................................12
Financial
Statements..................................................................12





<PAGE>



                                       A-1
                                   APPENDIX A

                    INFORMATION ABOUT THE PORTFOLIO MANAGERS


WILLIAM BLAIR & COMPANY, L.L.C.
222 West Adams Street
Chicago, IL 60606


     William  Blair & Company,  L.L.C.  ("Blair")  was  appointed as an All-Star
Portfolio  Manager  effective  March 1, 1997.  Blair is a registered  investment
advisor and an investment  banker and  broker-dealer  firm registered  under the
Securities  Exchange Act of 1934. Blair was founded over 50 years ago by William
McCormick Blair and currently has more than 70 principals and  approximately 900
employees  at offices in  Chicago,  San  Francisco,  London,  Liechtenstein  and
Zurich. The main office in Chicago houses all investment  banking,  research and
investment  management services.  As of May 31, 2001, Blair had over $13 billion
in assets under management.


     John  F.  Jostrand,  Principal,  has  managed  the  portion  of  All-Star's
portfolio  allocated  to Blair since its  appointment  as an All-Star  Portfolio
Manager. Mr. Jostrand has been associated with Blair since 1993.


TCW INVESTMENT MANAGEMENT COMPANY
865 South Figueroa Street
Los Angeles, CA  90017


     TCW  Investment  Management  Company  ("TCW") was  appointed as an All-Star
Portfolio Manager effective May 1, 2000. TCW is a wholly-owned subsidiary of The
TCW Group,  Inc.  ("TCW  Group").  Established  in 1971,  TCW Group's direct and
indirect  subsidiaries,  including TCW,  provide a variety of trust,  investment
management and investment advisory services.  Societe Generale Asset Management,
S.A.  ("SGAM") owns 51% of the TCW Group.  SGAM is a wholly-owned  subsidiary of
Societe Generale,  S.A. ("Societe Generale "). SGAM is located at 92708 place de
la Corpole,  92078 Paris,  France.  Societe  Generale is located at 29 boulevard
Haussman,   75009,  Paris,   France.  The  employees,   management,   and  other
shareholders  of the TCW Group own the remaining  49% of the company.  Under the
terms of an  agreement  between  the TCW Group and SGAM,  SGAM will  acquire  an
additional  1% interest in the TCW Group over the course of the next five years.
SGAM and TCW have stated their  intention to maintain the personnel,  processes,
investment  strategy and operations of TCW, which will continue to operate under
the TCW brand name.  As of May 31,  2001,  TCW and its  affiliates  had over $75
billion in assets under management or committed to management.


     Douglas S. Foreman, Chief Investment Officer U.S. Equities, has managed the
portion of All-Star's  portfolio  allocated to TCW since its  appointment  as an
All-Star Portfolio Manager. Mr. Foreman has been with TCW since 1994.


M.A. WEATHERBIE & CO., INC.
265 Franklin Street
Boston, MA  02110


     M.A.  Weatherbie & Co.,  Inc.  ("Weatherbie")  was appointed as an All-Star
Portfolio Manager  effective May 1, 1998.  Weatherbie,  a registered  investment
advisor,  was founded in 1995 by Matthew A.  Weatherbie.  Mr.  Weatherbie is the
principal  executive  officer and serves as President of Weatherbie  and manages
that portion of the Fund's portfolio  assigned to Weatherbie.  Prior to founding
Weatherbie,  Mr.  Weatherbie was a Managing Director at Putnam  Investments.  In
addition  to Mr.  Weatherbie  being the senior  principal,  there are five other
principals,  three research analysts, a trader and a director of administration.
Weatherbie is 100% employee-owned and operated with a partnership philosophy. As
of May 31, 2001, Weatherbie managed over $424 million in assets.






<PAGE>




No  person  has  been  authorized  to  give  any  information  or  to  make  any
representation  not  contained in this  Prospectus  and, if given or made,  such
information or representation must not be relied upon as having been authorized.
This Prospectus does not constitute an offering of any securities other than the
registered securities to which it relates or an offer to any person in any State
or  jurisdiction  of the United  States or any country where such offer would be
unlawful.  Neither the delivery of this  Prospectus  nor any sale made hereunder
shall,  under any  circumstances,  create an implication  that there has been no
change in the facts as set forth in the Prospectus or in the affairs of the Fund
since the date hereof.

                                  ------------



TABLE OF CONTENTS
Prospectus Summary................................2
Expenses..........................................7
Financial Highlights..............................8
Share Price Data.................................10
Investment Performance...........................10
The Offer........................................11
Special Considerations and Risk Factors..........17
Use of Proceeds..................................18
History of the Fund..............................18
The Multi-Manager Concept........................19
Investment Objectives, Policies and Risks........20
Management of All-Star ..........................21
Description of Shares............................23
Distributions; Automatic Dividend
    Reinvestment and Cash Purchase Plan..........24
Tax Status.......................................26
General..........................................27
Statement of Additional Information..............27
Appendix A--
    Information about the Portfolio Managers... A-1


                                   [LOGO HERE]








                                     LIBERTY
                                    ALL-STAR
                                GROWTH FUND, INC.
                       A Multi-Managed Investment Company




                        2,117,781 Shares of Common Stock
                      Issuable upon Exercise of Rights to
                           Subscribe for Such Shares






                               -------------------
                                   PROSPECTUS

                                 August [   ], 2001
                               -------------------


<PAGE>
                       LIBERTY ALL-STAR GROWTH FUND, INC.
                       STATEMENT OF ADDITIONAL INFORMATION


                                 August [  ], 2001

This Statement of Additional Information is not a prospectus, and should be read
in  conjunction  with the  Prospectus  of Liberty  All-Star  Growth  Fund,  Inc.
("All-Star")  dated  August 7, 2001. A copy of the  Prospectus  may be obtained,
without charge,  by calling or writing Liberty Asset  Management  Company at 600
Atlantic Avenue, Boston, Massachusetts 02110(1-800-542-3863).


 TABLE OF CONTENTS                                                   PAGE

 Investment Objectives and Policies                                   2
 Investment Restrictions                                              2
 Investment Advisory and Other Services                               4
 Directors and Officers of All-Star                                   5
 Portfolio Security Transactions                                     11
 Principal Shareholders                                              12
 Financial Statements                                                12




<PAGE>


                       INVESTMENT OBJECTIVES AND POLICIES

     A description of the investment  objective of Liberty All-Star Growth Fund,
Inc.  ("All-Star"  or the  "Fund") and the types of  securities  in which it may
invest  is  contained  in  the  Prospectus  under  "Investment   Objectives  and
Policies."

Foreign Securities

     All-Star  may invest up to 25 percent  of its net assets in  securities  of
foreign  issuers,  provided that the Fund will not purchase the  securities of a
foreign  issuer,  if, as a result of the  purchase,  more than 50% of its equity
investment would consist of securities of foreign issuers. All-Star's investment
in foreign  securities  involves  considerations  not typically  associated with
investing  in  securities  of domestic  companies.  Investing in  securities  of
foreign issuers and the attendant  holding of foreign  currencies,  for example,
could  cause the Fund to be  affected  favorably  or  unfavorably  by changes in
currency rates and exchange control regulations.  In addition,  less information
may be available  about  foreign  companies  than about  domestic  companies and
foreign  companies may not be subject to reporting or  accounting  standards and
requirements  comparable  to those  applicable  to domestic  companies.  Foreign
securities  and their  markets may not be as liquid as domestic  securities  and
their markets.  Securities of some foreign  companies may involve greater market
risk than securities of domestic companies and foreign brokerage commissions and
custody fees are generally higher than those in the United States. Investment in
foreign  securities  may also be subject to local  economic or political  risks,
including  instability of some foreign governments,  the possibility of currency
blockage or the imposition of withholding taxes on dividend or interest payments
and the potential for  expropriation of the assets of the companies  issuing the
securities.

Short sales against the box

     All-Star  may, to an extent not greater  than 5% of its net assets,  effect
short sales of  securities  "against the box" (i.e.,  short sales of  securities
where the Fund holds or has the right to obtain at no additional cost securities
identical to those sold short.)

                             INVESTMENT RESTRICTIONS

     The  following  investment  restrictions  have been adopted for All-Star as
fundamental  policies  and may be changed  only by a majority  vote (as  defined
under  "Investment  Objective  and  Policies" in the  Prospectus)  of All-Star's
outstanding  shares.  Non-fundamental  policies  may be  changed by the Board of
Directors without shareholder approval.

All-Star may not:

     (1) With respect to 75 percent of its total assets, invest in securities of
any one issuer if immediately after and as a result of such investment more than
five percent of the total assets of the Fund,  taken at market  value,  would be
invested in the securities of such issuer.  This  restriction  does not apply to
investments in U.S. Government Securities.

     (2) Purchase more than 10 percent of the outstanding voting securities,  or
any class of securities, of any one issuer.

     (3) Invest 25 percent or more of its total assets, taken at market value at
the time of each  investment,  in the  securities  of issuers in any  particular
industry.  This  restriction  does not apply to investments  in U.S.  Government
Securities.

     (4) Purchase securities of other investment companies; except in connection
with a merger,  consolidation,  acquisition or  reorganization,  if more than 10
percent of the market  value of the Fund's  total  assets  would be  invested in
securities of other investment  companies,  more than five percent of the market
value of the Fund's total assets would be invested in the  securities of any one
investment  company or the Fund  would own more than three  percent of any other
investment company's securities.

     (5) Purchase or sell commodities or real estate; provided that All-Star may
invest in  securities  secured by real estate or interests  therein or issued by
companies which invest in real estate or interests therein.

     (6) Purchase any  securities  on margin or make short sales of  securities,
except that All-Star may obtain such  short-term  credit as may be necessary for
the clearance of purchases and sales of portfolio securities.

     (7) Make loans of money,  except by the  purchase  of debt  obligations  in
which the Fund may invest consistent with its investment objective and policies.
Although there is no present  intention of doing so in the  foreseeable  future,
All-Star reserves the authority to make loans of its portfolio  securities in an
aggregate  amount not exceeding 20 percent of its total  assets.  Any such loans
will only be made upon  approval of, and subject to any  conditions  imposed by,
All-Star's Board of Directors.

<PAGE>

     (8) Borrow  money,  except  that  All-Star  may borrow from banks and other
financial  institutions  on an unsecured  basis to finance the repurchase of its
shares.  All-Star  also may  borrow  money on a secured  basis  from  banks as a
temporary  measure for  extraordinary  or  emergency  purposes.  Such  temporary
borrowings  may not exceed five  percent of the value of the Fund's total assets
at the time the loan is made. All-Star may pledge up to 10 percent of the lesser
of the  cost or  value of its  total  assets  to  secure  temporary  borrowings.
All-Star  will  not  borrow  for  investment  purposes.  Immediately  after  any
borrowing,  All-Star will maintain  asset  coverage of not less than 300 percent
with respect to all borrowings.  While the Fund's borrowings exceed five percent
of its total  assets,  All-Star  will make no further  purchases of  securities,
although this limitation will not apply to share repurchase transactions.

     (9) Issue senior  securities,  as defined in the Investment  Company Act of
1940 (the "Act"), or mortgage, pledge, hypothecate or in any manner transfer, as
security for  indebtedness,  any securities  owned or held by All-Star except as
may be necessary in connection with borrowings  mentioned in (8) above, and then
such  mortgaging,  pledging  or  hypothecating  may not exceed 10 percent of the
Fund's total assets, taken at the lesser of cost or market value.

     (10) Underwrite  securities of other issuers except insofar as All-Star may
be deemed an  underwriter  under the  Securities  Act of 1933,  as  amended,  in
selling portfolio securities.

     (11) Invest more than 10 percent of  All-Star's  total assets in securities
that at the time of purchase have legal or  contractual  restrictions  on resale
(including unregistered securities that are eligible for resale pursuant to Rule
144A under the Securities Act of 1933).

     Except for the 300% limitation referred to in Investment  Restriction No. 8
above, if a percentage restriction on investment or utilization of assets as set
forth above is adhered to at the time an  investment  is made, a later change in
percentage  resulting  from a change in the market values of  All-Star's  assets
wlll not be considered a violation of the restriction.


                     INVESTMENT ADVISORY AND OTHER SERVICES

     As stated under  "Management of All-Star" in the Prospectus,  Liberty Asset
Management Company ("LAMCO") performs the investment  management services and is
responsible for the administrative  services described therein.  LAMCO,  through
Liberty Financial Companies, Inc. ("Liberty Financial"), is an indirect majority
owned subsidiary of Liberty Mutual Insurance Company, Boston, Massachusetts.  As
indicated under  "Directors and Officers of All-Star"  below,  one of All-Star's
Directors  and all of its officers are  officers of LAMCO,  Colonial  Management
Associates, Inc., Liberty Financial or other affiliates of Liberty Financial.

     Reference  is made to  Appendix  A of the  Prospectus  for the names of the
controlling  persons of All-Star's  current Portfolio  Managers and the names of
the  individuals  at  each  Portfolio  Manager  primarily  responsible  for  the
management of the portion of All-Star's  portfolio  assigned to it. None of such
Portfolio  Managers  has any  affiliation  with LAMCO or  (except  as  Portfolio
Manager) with All-Star.

     As described  under  "Management of All-Star" in the  Prospectus,  All-Star
pays LAMCO a fund  management fee for its investment  management  services (from
which LAMCO pays the Portfolio Managers' fee), and an administrative fee for its
administrative services.

     For the years ended  December  31, 1999 and 2000 the total fund  management
and   administrative   fees  paid  to  LAMCO  were   $967,672  and   $2,165,252,
respectively, of which an aggregate of $309,655 and $692,932,  respectively, was
paid to the Portfolio Managers. See "History of the Fund" in the Prospectus.

     All-Star's  current Fund  Management  Agreement  and  Portfolio  Management
Agreements  will  continue in effect  until July 31,  2002 and will  continue in
effect thereafter so long as such continuance is specifically  approved annually
by (a) the Board of Directors or (b) the majority vote of All-Star's outstanding
shares (as defined under "Investment Objective and Policies" in the Prospectus),
provided that, in either event,  the  continuance is also approved by a majority
of the Directors who are not  "interested  persons" (as defined in the 1940 Act)
of  All-Star,  LAMCO or the  Portfolio  Managers  by a vote  cast in person at a
meeting called for the purpose of voting on such approval.  The Fund  Management
Agreement may be terminated on 60 days written  notice by either party,  and the
Portfolio  Management  Agreements  may be  terminated  on 30 days' notice by any
party, and any such agreements will terminate automatically if assigned.


     The  Fund  and  LAMCO  have  adopted  Codes  of  Ethics   pursuant  to  the
requirements of the Investment  Company Act of 1940, as amended.  These Codes of
Ethics permit personnel subject to the Codes to invest in securities,  including
securities  that may be purchased  or held by the funds.  Copies of the Codes of
Ethics of the Fund and  LAMCO can be  reviewed  and  copied at the  Commission's
Public  Reference Room in Washington,  D.C.  Information on the operation of the
Public   Reference   Room  may  be  obtained  by  calling  the   Commission   at
1-202-942-8090.  The Codes of Ethics are also available on the EDGAR database on
the Commission's Internet site at www.sec.gov,  or may be obtained, after paying
a duplicating fee, by electronic  request at  publicinfo@sec.gov,  or by writing
the Commission's Public Reference Section, Washington, D.C. 20549-0102.





Custodian and Pricing and Bookkeeping Agent

     JP Morgan Chase and Company (the  "Bank"),  270 Park Avenue,  New York,  NY
10017-2070,  is the custodian of the portfolio  securities and cash of All-Star.
As such,  the Bank holds  All-Star's  portfolio  securities and cash in separate
accounts on All-Star's behalf and receives and delivers portfolio securities and
cash in connection with portfolio transactions initiated by All-Star's Portfolio
Managers, collects income due on its portfolio securities and disburses funds in
connection with the payment of distributions and expenses.


     Colonial Management Associates,  Inc. ("Colonial"),  an affiliate of LAMCO,
performs  pricing and  bookkeeping  services for All-Star  (see  "Management  of
All-Star" in the  Prospectus).  For the years ended  December 31, 1999 and 2000,
All-Star paid pricing and bookkeeping  fees to Colonial  Management  Associates,
Inc. of $63,522 and $68,804 respectively.


Independent Accountants

     PricewaterhouseCoopers  LLP,  160  Federal  Street,  Boston,  Massachusetts
02110, are the independent  accountants of All-Star. The independent accountants
audit and report on the  annual  financial  statements  and  provide  tax return
preparation  services and assistance  and  consultation  in connection  with the
review of various SEC filings.


                       DIRECTORS AND OFFICERS OF ALL-STAR


     The following is a list of All-Star's Directors and officers, together with
information  about their present  positions  with  All-Star and their  principal
occupations  during  the past five  years.  The  Directors  who are  "interested
persons"  of  All-Star,  as  defined  by the 1940  Act,  are  indicated  with an
asterisk.

<TABLE>

<S>                                               <C>
Name (Age) and Address                            Position with Principal
Occupation During Past
----------------------
----------------------------------------------
                                                  Five Years

Robert J. Birnbaum (73)                           Retired since January, 1994;
Special Counsel,
313 Bedford Road                                  Dechert, Price & Rhoads
(September, 1988 to
Ridgewood, NJ  07450                              December, 1993); President and
Chief Operating
                                                  Officer, New York Stock
Exchange, Inc. (May,
                                                  1985 to June, 1988); Director,
Dresdner RCM
                                                  Europe Fund (investment
company) and Options
                                                  Exchange Board.

James E. Grinnell (71)                            Private investor since
November, 1988; President
2850 South Ocean Blvd., #514                      and Chief Executive Officer,
Distribution
Palm Beach, FL  33480                             Management Systems, Inc. (1983
to May, 1986);
                                                  Senior Vice President,
Operations, The Rockport
                                                  Company (importer and
distributor of shoes)
                                                  (May, 1986 to November, 1988).



Richard W. Lowry (65)                             Private Investor since 1987
(formerly Chairman
10701 Charleston Drive                            and Chief Executive Officer,
U.S. Plywood
Vero Beach, FL  32963                             Corporation (building products
manufacturer)).

William E. Mayer* (61)                            Managing Partner, Park Avenue
Equity Partners
Park Avenue Equity Partners                       (venture capital) since 1998
(formerly Founding
500 Park Avenue, 5th Floor                        Partner, Development Capital,
LLC from November,
New York, NY  10022                               1996 to 1998; Dean and
Professor, College of
                                                  Business and Management,
University of Maryland
                                                  from October, 1992 to
November, 1996); Director,
                                                  Johns Manville (building
products manufacturer),
                                                  Lee Enterprises (print and
on-line media); WR
                                                  Hambrecht & Co (financial
service provider);
                                                  Systech Retail Systems (retail
industry
                                                  technology provider)).


<PAGE>


John J. Neuhauser (58)                            Academic Vice President and
Dean of Faculties
Boston College                                    since August, 1999, Boston
College (formerly
Bourneof House                                    Dean, Boston College School of
Management from
84 College Road                                   September 1977 to September,
1999).
Chestnut Hill, MA  02467-3838

Joseph R. Palombo* (48)                           Chief Operations Officer of
Mutual Funds,
Liberty Financial Companies, Inc.                 Liberty Financial Companies,
Inc. (Liberty
600 Atlantic Avenue                               Financial) since August, 2000;
Executive Vice
Boston, MA 02210                                  President and Director of
Colonial Management
                                                  Associates, Inc. (Colonial)
since April, 1999;
                                                  Executive Vice President and
Chief
                                                  Administrative Officer of
Liberty Funds Group
                                                  LLC (LFG) since April, 1999;
Director of Stein
                                                  Roe since September, 2000;
Trustee and Chairman
                                                  of the Board of Stein Roe
Mutual Funds since
                                                  October, 2000; Manager of
Stein Roe Floating
                                                  Rate Limited Liability Company
since October,
                                                  2000 (formerly Vice President
of the Liberty
                                                  Funds from April 1999 to
August, 2000; Chief
                                                  Operating Officer, Putnam
Mutual Funds from 1994
                                                  to 1998).

</TABLE>


The following  are the  executive  officers  (except for Mr.  Palombo  described
earlier) of All-Star.

<TABLE>

<S>                                                <C>
  <C>
Name (Age) and Address                             Position with All-Star
  Principal Occupation During Past Five
----------------------                             ----------------------
  -------------------------------------

  Years

  -----

William R. Parmentier, Jr. (48)                    President, Chief Executive
  President and Chief Executive Officer
Liberty Asset Management Company                   Officer and Chief Investment
  (since June, 1998) and Chief
Federal Reserve Plaza                              Officer
  Investment Officer (since May, 1995),
600 Atlantic Avenue
  Senior Vice President (May, 1995 to
Boston, MA  02210
  June, 1998), Liberty Asset

  Management; Chief Investment Officer,

  Grumman Corporation (1979 to 1994).

Kevin M. Carome (45)                               Executive Vice President
  Executive Vice President of Liberty
Liberty Funds Group
  Funds and of the Liberty All-Star
One Finanacial Center
  Funds since October, 2000; Executive
Boston, MA  02111
  Vice President of the Stein Roe Funds

  since May, 1999 (formerly Vice

  President from April, 1998 to May,

  1999, Assistant Secretary from April,

  1998 to February, 2000 and Secretary

  from February, 2000 to May, 2000);

  Chief Legal Officer of LFC since

  August, 2000; Senior Vice President,

  Legal since January, 1999 of LFG;

  Executive Vice President and

  Assistant Secretary of SR&F since

  January, 2001 (formerly General

  Counsel and Secretary of SR&F from

  January, 1998 to December, 1999; Vice

  President and Associate General

  Counsel of LFC from August, 1993 to

  December, 1998).

Christopher S. Carabell (38)                       Vice President
  Senior Vice President - Product
Liberty Asset Management Co.
  Development and Marketing (since
Federal Reserve Plaza
  January, 1999), Vice
600 Atlantic Avenue
  President-Investments, Liberty Asset
Boston, MA  02210
  Management (March, 1996 to January,

  1999); Associate Director, U.S.

  Equity Research, BARRA Rogers Casey,

  investment consultants (January, 1995

  to February, 1996).

</TABLE>


<PAGE>



<TABLE>

<S>                                             <C>
  <C>
Name (Age) and Address                          Position with All-Star
  Principal Occupation During Past Five
----------------------                          ----------------------
  -------------------------------------

  Years

  -----



Mark T. Haley (36)                              Vice President
  Vice President-Investments (since
Liberty Asset Management Co.
  January, 1999), Director of
Federal Reserve Plaza
  Investment Analysis (December, 1996
600 Atlantic Avenue
  to December, 1998), Investment
Boston, MA  02210
  Analyst (January, 1994 to November,

  1996), Liberty Asset Management.



J. Kevin Connaughton (37)                       Treasurer
  Treasurer of the Liberty Funds and of
Liberty Funds Group
  the Liberty All-Star Funds since
One Financial Center
  December, 2000 (formerly Controller
Boston, MA  02111
  of the Liberty Funds and of the

  Liberty All-Star Funds from February,

  1998 to October, 2000); Treasurer of

  the Stein Roe Funds since February,

  2001 (formerly Controller from May,

  2000 to February, 2001); Vice

  President of Colonial since February,

  1998 (formerly Senior Tax Manager,

  Coopers & Lybrand, LLP from April,

  1996 to January, 1998; Vice

  President, 440 Financial Group/First

  Data Investor Services Group from

  March, 1994 to April, 1996).



William J. Ballou (36)                          Secretary
  Secretary of the Liberty Funds and of
Liberty Funds Group
  the Liberty All-Star Funds since
One Financial Center
  October, 2000 (formerly Assistant
Boston, Ma  02111
  Secretary from October, 1997 to

  October, 2000); Secretary of the

  Stein Roe Funds since February, 2001

  (formerly Assistant Secretary from

  May, 2000 to February, 2001); Vice

  President, Assistant Secretary and

  Counsel of Colonial since October,

  1997; Vice President and Counsel

  since April, 2000, and Assistant

  Secretary since December, 1998 of LFG

  (formerly Associate Counsel,

  Massachusetts Financial Services

  Company from May, 1995 to September,

  1997).

</TABLE>

<TABLE>

<S>                                             <C>
  <C>
Name (Age) and Address                          Position with All-Star
  Principal Occupation During Past Five
----------------------                          ----------------------
  -------------------------------------

  Years

  -----

Michelle G. Azrialy (32)                        Controller
  Controller of the Liberty Funds and
One Financial Center
  of the Liberty All-Star Funds since
Boston, MA  02111
  May, 2001; Vice President of LFG

  since March, 2001 (formerly Assistant

  Vice President of Fund Administration

  from September, 2000 to February,

  2001; Compliance Manager of Fund

  Administration from September, 1999

  to August, 2000) (formerly Assistant

  Treasurer, Chase Global Fund Services

  - Boston from August, 1996 to

  September, 1999; Senior Accountant,

  PricewaterhouseCoopers LLP from June,

  1991 to July, 1994).

<PAGE>

Vicki Benjamin (39)                             Chief Accounting Officer
  Chief Accounting Officer of the
One Financial Center
  Liberty Funds and of the Liberty
Boston, MA  02111
  All-Star Funds since June, 2001; Vice

  President of LFG since April, 2001

  (formerly Vice President, Corporate

  Audit, State Street Bank and Trust

  Company from May, 1998 to April,

  2001; Senior Audit Manager, Coopers &

  Lybrand from December, 1989 to May,

  1998).

</TABLE>


     Messrs.  Birnbaum,   Grinnell,  Lowry  and  Neuhauser  comprise  the  Audit
Committee of the Board of Directors.

     All-Star's Board of Directors is divided into three classes,  each of which
has a term of three years  expiring with the annual meeting of  shareholders  in
the third year of the term.  All-Star holds annual  meetings of  shareholders to
vote on, among other things,  the election or re-election of the Directors whose
terms are expiring with that meeting. The term or office of Messrs. Birnbaum and
Mayer will expire upon the final  adjournment  of the 2002 annual  meeting;  the
term of  office of  Messrs.  Grinnell  and  Neuhauser  will  expire  upon  final
adjournment  of the annual  meeting for the year 2003; and the term of office of
Messrs.  Lowry and  Palombo  will expire  upon final  adjournment  of the annual
meeting for the year 2004. Messrs. Lowry, Mayer,  Neuhauser and Palombo are also
Directors of Liberty  Funds  Trusts I through VII (the  "Liberty  Trusts"),  the
umbrella  trusts for an aggregate of 49 open-end  funds managed by affiliates of
LAMCO,  nine  closed-end  funds  managed by Colonial (the  "Colonial  Closed-End
Funds"),  Liberty Variable  Investment Trust, the umbrella trust for 17 open-end
funds managed by Colonial or its  affiliates  that serve as investment  vehicles
for variable  annuities and variable life insurance  products;  Liberty Floating
Rate Fund; Stein Roe Floating Rate Limited Liability Company,  Liberty-Stein Roe
Institutional  Floating  Rate Income  Fund and  Liberty-Stein  Roe Funds  Income
Trust,   Liberty-Stein  Roe  Funds  Municipal  Trust,  Liberty-Stein  Roe  Funds
Investment Trust,  Liberty-Stein  Roe Advisor Trust,  Stein Roe Trust, SR&F Base
Trust and Stein Roe  Variable  Investment  Trust,  the  umbrella  trusts  for 42
open-end funds managed by Stein Roe & Farnham  Incorporated,  a LAMCO affiliate.
The All Star's Board of Directors are also trustees of Liberty  All-Star  Equity
Fund, another closed-end multi-managed fund managed by LAMCO.

     LAMCO  or its  affiliates  pay  the  compensation  of all the  officers  of
All-Star, including the Director who is affiliated with LAMCO. Beginning January
1, 1999,  the  aggregate of the fees paid to the Directors by All-Star that have
the same Board of Trustees  as the Liberty  All-Star  Equity  Fund,  and Liberty
All-Star Growth and Income Fund and hold their meetings  concurrently with those
of the Fund,  consists  of  Directors  fees of  $125,000  per annum,  assuming a
minimum of four  meetings are held and all meetings are  attended.  One-third of
the retainer and the fees for concurrently held meetings was allocated among the
Fund and the two other funds on a per fund basis,  and the  remaining two thirds
was  allocated  among  the three  funds  based on their  net  assets.  Effective
February  9, 2001,  Liberty  All-Star  Growth and  Income  Fund was merged  into
another  open-end  fund in the Liberty  Trusts and the retainer and meeting fees
will be allocated  between the Fund and Liberty  All-Star Equity Fund. For 2000,
All-Star  paid the  independent  Directors  an  aggregate of $25,130 in fees and
expenses.

     The  following  table shows,  for the year ended  December  31,  2000,  the
compensation received from the Fund by each current Director,  and the aggregate
compensation paid to each current Director for service on the Board of Directors
of the Fund and the two All-Star Funds. The Fund has no bonus, profit sharing or
retirement plans.

<TABLE>
<S>                                 <C>                             <C>
Name                                     Aggregate
----                                Compensation from
Total Compensation from the
                                         the Fund                   Liberty
All-Star Funds (including the Fund)
                                         --------
-------------------------------------------

Robert J. Birnbaum                        $5,002
     $25,000
John V. Carberry(1)                         N/A
       N/A
James E. Grinnell                         $5,002
     $25,000
Richard W. Lowry                          $5,002
     $25,000
William E. Mayer                          $5,002
     $25,000
John J. Neuhauser                         $5,002
     $25,000
Joseph R. Palombo(2)                        N/A
       N/A

</TABLE>

(1)  Retired  as  Director  of the Fund on August 4, 2000,  and did not  receive
     compensation because he was an affiliated Director and an employee of LFC.
(2)  Does not receive  compensation  because he is an affiliated Director and an
     employee of LFC.

The following  table shows,  for the calendar year ended  December 31, 2000, the
compensation received from the Liberty Funds by the Trustees.  The Liberty Funds
have no bonus, profit sharing or retirement plans.

<PAGE>

Name                                       Total Compensation from Liberty Funds
----                                       -------------------------------------

James E. Grinnell(3)                                     $102,000
Richard W. Lowry                                           99,000
William E. Mayer                                          100,000
John J. Neuhauser                                         101,210
Joseph R. Palombo(4)                                        N/A

(3)  Resigned as Trustee of the Liberty Funds on December 27, 2000.
(4)  Did not receive  compensation  because he is an  affiliated  Trustee and an
     employee of LFC.

                         PORTFOLIO SECURITY TRANSACTIONS

     Each of All-Star's  Portfolio Managers has discretion to select brokers and
dealers to execute portfolio transactions initiated by the Portfolio Manager for
the portion of All-Star's  portfolio  assets  allocated to it, and to select the
markets in which such transactions are to be executed.  The Portfolio Management
Agreements with All-Star provide, in substance,  that, except as provided in the
following paragraph,  in executing portfolio  transactions and selecting brokers
or dealers,  the primary  responsibility  of the Portfolio Manager is to seek to
obtain best net price and execution for All-Star. It is expected that securities
will ordinarily be purchased in the primary markets,  and that, in assessing the
best net price and execution  available to All-Star,  the Portfolio Manager will
consider all factors it deems  relevant,  including the breadth of the market in
the security,  the price of the security,  the financial condition and execution
capability of the broker or dealer and the reasonableness of the commission,  if
any, for the specific  transaction and on a continuing basis.  Recognizing these
factors, All-Star may pay a brokerage commission in excess of that which another
broker or dealer may have charged for effecting the same transaction.

     The Portfolio  Management  Agreements also provide that LAMCO has the right
to request that transactions giving rise to brokerage commissions, in amounts to
be agreed upon from time to time between  LAMCO and the  Portfolio  Manager,  be
executed by brokers  and  dealers  (to be agreed upon from time to time  between
LAMCO and the  Portfolio  Manager)  which  provide,  directly  or through  third
parties, research products and services to LAMCO or to All-Star. The commissions
paid on such  transactions  may exceed the amount of commissions  another broker
would have  charged  for  effecting  that  transaction.  Research  products  and
services  made  available  to  LAMCO  through  brokers  and  dealers   executing
transactions for All-Star involving brokerage  commissions include  performance,
portfolio   characteristics,   investment   style  and  other   qualitative  and
quantitative  data relating to investment  managers in general and the Portfolio
Managers in particular;  data relating to the historic performance of categories
of  securities   associated  with  particular  investment  styles;  mutual  fund
portfolio,  performance  and fee and expense  data;  data  relating to portfolio
manager changes by pension plan fiduciaries;  quotation  equipment;  and related
computer  hardware and  software,  all of which are used by LAMCO in  connection
with its selection and monitoring of portfolio managers (including the Portfolio
Managers) for All-Star and other multi-managed clients of LAMCO, the assembly of
a mix of investment styles appropriate to the investment  objectives of All-Star
or such other clients, and the determination of overall portfolio strategies.

     LAMCO from time to time reaches  understandings  with each of the Portfolio
Managers as to the amount of the All-Star  portfolio  transactions  initiated by
such  Portfolio  Manager  that are to be directed  to brokers and dealers  which
provide  or make  available  research  products  and  services  to LAMCO and the
commissions to be charged to All-Star in connection therewith. These amounts may
differ among the Portfolio  Managers  based on the nature of the markets for the
types of securities managed by them and other factors.

     These research  products and services are used by LAMCO in connection  with
its  management of All-Star,  Liberty  All-Star  Equity Fund,  Liberty  All-Star
Equity  Fund,  Varlable  Series,  and  other  multi-managed  clients  of  LAMCO,
regardless of the source of the brokerage commissions.  In instances where LAMCO
receives  from  broker-dealers  products  or  services  which  are used both for
research purposes and for administrative or other non-research  purposes,  LAMCO
makes a good faith effort to determine the relative proportions of such products
or services which may be considered as investment  research,  based primarily on
anticipated usage, and pays for the costs attributable to the non-research usage
in cash.

     The Portfolio Managers are authorized to cause All-Star to pay a commission
to a broker or  dealer  who  provides  research  products  and  servlces  to the
Portfollo  Manager for executing a portfolio  transaction  which is in excess of
the  amount of  commission  another  broker or dealer  would  have  charged  for
effecting that transaction. The Portfolio Managers must determine in good faith,
however,  that such  commission  was  reasonable in relation to the value of the
research  products  and  services  provided  to  them,  viewed  in terms of that
particular  transaction  or in  terms  of all  the  client  accounts  (including
All-Star) over which the Portfolio Manager exercises investment  discretion.  It
is  possible  that  certain of the  services  received  by a  Portfolio  Manager
attributable  to a particular  transaction  will  primarily  benefit one or more
other  accounts for which  investment  discretlon  is exercised by the Portfolio
Manager.

<PAGE>


     During 1998, 1999 and 2000, All-Star paid total brokerage  commissions of
$159,554, $251,387 and $204,925,  respectively.  Approximately $55,361 of the
commissions paid in 1998, and $103,707 and $37,364, respectively, of the
commissions paid in 1999 and 2000 on transactions aggregating approximately
$115,316,997 and $50,127,330, respectively, were paid to brokerage
firms which  provided or made available to All-Star's  Portfolio  Managers or to
LAMCO research products and services as described above.



     Although  All-Star  does not permit a  Portfolio  Manager to act or have an
affiliate  act as broker for Fund  portfolio  transactions  initiated by it, the
Portfolio Managers are permitted to place Fund portfolio  transactions initiated
by them with  another  Portfolio  Manager  or its  broker-dealer  affiliate  for
execution on an agency basis,  provided the commission does not exceed the usual
and customary  broker's  commission  being paid to other brokers for  comparable
transactions and is otherwise in compliance with Rule 17e-1 under the Investment
Company Act of 1940.  During 1998, 1999 and 2000 no Fund  portfolio
transactions  were placed with any Portfolio  Manager or its broker-dealer
affiliate.


                             PRINCIPAL SHAREHOLDERS

     On July 16, 2001,  Cede & Co. Fast, Depository Trust Company,
55 Water Street, New York, NY 10004 owned beneficially 14,437,309 shares,
representing 85.21% of the All-Star's then outstanding shares.

     As of July 16,  2001,  all officers  and  Directors of All-Star as a group
owned less than 1% of All-Star's outstanding shares.

                              FINANCIAL STATEMENTS


     PricewaterhouseCoopers  LLP, are the independent  accountants for the Fund.
PricwaterhouseCoopers LLP provides audit and tax return preparation services and
assistance and consultation in connection wtih the review of various  Securities
and Exchange  Commission  filings.  Prior to September,  1999, KPMG LLP were the
independent  auditors for the Fund.  The financial  statements  incorporated  by
reference in this SAI have been so incorporated, and the financial statements in
the  Prospectus  have  been  so  included,  in  reliance  upon  the  reports  of
PricewaterhouseCoopers  LLP and KPMG LLP  given on  authority  of said  firms as
experts in accounting  and auditing.  The Fund's Annual  Report,  which includes
financial   statements   for  the  fiscal  year  ended  December  31,  2000,  is
incorporated  herein by reference with respect to all information other than the
information set forth on pages 1 through 17 thereof.  Any statement contained in
the Fund's Annual Report that was  incorporated  herein shall be deemed modified
or superseded  for purposes of the  Prospectus  or this  Statement of Additional
Information  to the  extent a  statement  contained  in the  Prospectus  or this
Statement  of  Additional  Information  varies  from  such  statement.  Any such
statement  so  modified  or  superseded  shall  not,  except as so  modified  or
superseded,  be deemed to constitute a part of the  Prospectus or this Statement
of Additional Information.  The Fund will furnish, without charge, a copy of its
Annual Report,  upon request to Liberty Asset Management  Company,  600 Atlantic
Avenue, Boston, Massachusetts 02110, telephone (800) 542-3863.


<PAGE>

PART C.

Other Information.

Item 24. Financial Statements and Exhibits

      (1)  Financial Statements:
                               Included in Part A:

                             Financial statements included in Part A of this
                             registration statement:  Financial Highlights

                               Included in Part B:

                             Financial  statements  included  in  Part B of this
                             registration  statement:  Incorporated by reference
                             to  the  Annual   Report dated  December 31,  2000
                             (Accession  Number:  912057-01-007678),   filed
                             electronically  pursuant to Section 30(b)(2) of the
                             Investment Company Act of 1940

      (2)  Exhibits

             (a)(1)          Articles of Incorporation(1)

             (a)(2)          Articles of Amendment dated April 27, 1989(1)

             (a)(3)          Articles of Amendment dated May 31, 1991(1)

             (a)(4)          Articles of Amendment dated November 6, 1995(1)

             (b)             By-Laws

             (c)             Not Applicable

             (d)(1)          Form of  Specimen Certificate for shares of
                             Common Stock(1)

             (d)(2)          Form of Subscription Certificate

             (d)(3)          Form of Notice of Guaranteed Delivery

             (e)             Automatic Dividend Reinvestment and Cash
                             Purchase Plan Brochure(1)

             (f)             Not Applicable

             (g)(1)          Management Agreement between Liberty All-Star
                             Growth Fund, Inc. and Liberty Asset Management
                             Company

             (g)(2)          Portfolio Management Agreement between Liberty
                             All-Star Growth Fund, Inc., Liberty Asset
                             Management Company and William Blair & Company,
                             L.L.C.

             (g)(3)          Portfolio Management Agreement between Liberty
                             All-Star Growth Fund, Inc., Liberty Asset
                             Management Company and M.A. Weatherbie & Co.,
                             Inc.

             (g)(4)          Portfolio Management Agreement between Liberty
                             All-Star Growth Fund, Inc., Liberty Asset
                             Management Company and TCW Investment Management
                             Company

             (h)             Not Applicable

             (i)             Not Applicable

             (j)(1)          Form of Custody Agreement between Liberty All-
                             Star Growth Fund, Inc. and The Chase Manhattan
                             Bank(1)

             (j)(2)          Supplement to Custody Agreement between Liberty
                             All-Star Growth Fund, Inc. and The Chase
                             Manhattan Bank(1)

             (k)(1)          Registrar, Transfer Agency and Service Agreement
                             between Liberty All-Star Growth Fund, Inc. and
                             State Street Bank & Trust Company(1)

             (k)(2)          Pricing and Bookkeeping Agreement between Liberty
                             All-Star Growth Fund, Inc. and Colonial Management
                             Associates, Inc.(1)

             (k)(3)          Form of Amendment to Pricing and Bookkeeping
                             Agreement between Liberty All-Star Growth Fund,
                             Inc. and Colonial Management Associates, Inc.(3)

             (k)(4)          Form of Subscription Agreement between Liberty
                             All-Star Growth Fund, Inc. and EquiServe

             (k)(5)          Form of Information Agent Agreement

             (l)             Opinion and Consent of Counsel

             (m)             Not Applicable

             (n)(1)          Consent of Independent Accountants -
                              PricewaterhouseCoopers LLP

             (n)(2)          Consent of Independent Auditors - KPMG, LLP

             (o)             Not Applicable

             (p)             Not Applicable

             (q)             Not Applicable

             (r)             Code of Ethics of the Liberty Financial Companies
                             - filed in Part C, Item 23 of Post-Effective
                             Amendment No. 29 to the Registration Statement on
                             Form N-1A of Liberty Funds Trust V (File Nos.
                             33-12109 and 811-5030), filed with the Commission
                             on or about January 24, 2001, and is hereby
                             incorporated and made a part of this Registration
                             Statement

-------------------------------------------------------------------------------

Power of Attorney  for: Robert J. Birnbaum, James E. Grinnell, Richard W. Lowry,
William E. Mayer, John J. Neuhauser and Joseph R. Palombo(3)


---------------------------------------------------------------------------
(1)  Incorporated  by reference  to the  Registration  Statement  filed with the
     Commission via EDGAR on or about May 1, 1998.
(2)  Incorporated by reference to Pre-Effective Amendment No. 1 filed with the
     Commission via EDGAR on or about May 26, 1998.
(3)  Incorporated by reference to the Registration Statement filed with the
     Commission via EDGAR on or about June 27, 2001.


Item 25.  Marketing Arrangements

     Not Applicable.

Item 26.  Other Expenses of Issuance and Distribution

     The following table sets forth the expenses to be incurred in connection
     with the offering described in this Registration Statement:

     Registration fee                                    $ 5,045
     New York Stock Exchange listing fee                   5,000
     Printing                                             15,000
     Accounting fees and expenses                          5,000
     Legal fees and expenses                              50,000
     Information Agent fees and expenses                  10,000
     Subscription Agent fees and expenses                 55,000
     Miscellaneous                                         4,955
                                                       ---------
         Total                                           150,000
                                                       =========




Item 27.  Persons Controlled By or Under Common Control with Registrant


     None.



<PAGE>


Item 28.  Number of Holders of Securities

           Number of Record Holders
            as of 8/2/01:  3,192


Item 29.  Indemnification

                 The Articles of Incorporation filed as Exhibit (a)(1) to
                 this Registration  Statement  provides for  indemnification  to
                 each of the Registrant's  Directors  and  officers  against all
                 liabilities  and  expenses  incurred  in acting as Director  or
                 officer, except in the case of willful misfeasance,  bad faith,
                 gross  negligence or reckless  disregard of the duties involved
                 in the conduct of such Directors and officers.

                 Insofar as  indemnification  for  liability  arising  under the
                 Securities  Act of 1933 may be permitted to trustees,  officers
                 and  controlling  persons  of the  Registrant  pursuant  to the
                 foregoing  provisions,  or otherwise,  the  Registrant has been
                 advised  that in the  opinion of the  Securities  and  Exchange
                 Commission  such  indemnification  is against  public policy as
                 expressed in the Act and is, therefore,  unenforceable.  In the
                 event that a claim for indemnification against such liabilities
                 (other than the payment by the Registrant of expenses  incurred
                 or paid by a  trustee,  officer  or  controlling  person of the
                 Registrant  in the  successful  defense of any action,  suit or
                 proceeding) is asserted by such trustee, officer or controlling
                 person in connection with the securities being registered,  the
                 Registrant  will,  unless in the  opinion  of its  counsel  the
                 matter has been settled by controlling  precedent,  submit to a
                 court of  appropriate  jurisdiction  the question  whether such
                 indemnification  by it is against public policy as expressed in
                 the Act and will be governed by the final  adjudication of such
                 issue.

                 The Registrant,  its advisor, Liberty Asset Management Company,
                 and its Administrator,  Colonial  Management  Associates,  Inc.
                 (Colonial),  and  their  respective  trustees,   directors  and
                 officers  are insured by a Directors  and  Officers/Errors  and
                 Omissions   Liability   insurance  policy  through  ICI  Mutual
                 Insurance Company.



ITEM 30.  Business and Other Connections of Investment Adviser.

Liberty Asset Management Company ("LAMCO"), Liberty All-Star Growth Fund, Inc.'s
Fund Manager, was organized in August 1985 and is primarily engaged in the
corporate administration of and the provision of its multi-management services
for Liberty All-Star Growth Fund, Inc. and Liberty All-Star Equity Fund, another
multi-managed closed-end investment company.  It also provides its multi-
management services to Liberty All-Star Equity Fund, Variable Series, a multi-
managed open-end investment company which serves as an investment vehicle for
variable annuity contracts issued by affiliated insurance companies.

For a two-year business history of officers and directors of LAMCO, please
refer to Form ADV of LAMCO (SEC File Number:  801-26296) and to the section of
the statement of additional information (Part B) entitled "Investment Advisory
and Other Services."


                                                               POSITION FORMERLY
                                                                  HELD WITHIN
                                  CURRENT POSITION               PAST TWO YEARS
                                  ----------------            ------------------

Christopher S. Carabell         Senior Vice President(LAMCO)     Vice President

Lindsay Cook                    Senior Vice President &
                                  Director (LAMCO)
                                Executive Vice President (Liberty
                                  Financial Companies, Inc. (LFC))

Fred J. Franklin                Chief Compliance Officer (LAMCO)
                                Vice President & Chief Compliance
                                  Officer (LFC)

Mark T. Haley                   Vice President (LAMCO)

J. Andrew Hilbert               Vice President, Treasurer
                                  & Director (LAMCO)
                                Treasurer, Chief Financial
                                  Officer & Senior Vice President (LFC)

William R. Parmentier           President, Chief Exec.
                                  Officer & Chief
                                  Investment Officer (LAMCO)

Frederick J. Turcotte           Vice President & Secretary (LAMCO)
                                Vice President (LFC)


Item 31.      Location of Accounts and Records:

              Registrant  maintains the records  required to be maintained by it
              under Rules 31a-1(a),  31a-1(b), and 31a-2(a) under the Investment
              Company  Act of 1940 at its  principal  executive  offices  at One
              Financial  Center,  Boston, MA 02111.  Certain records,  including
              records  relating to  Registrant's  shareholders  and the physical
              possession of its securities,  may be maintained  pursuant to Rule
              31a-3  at the  main  office  of  Registrant's  transfer  agent  or
              custodian.

Item 32.      Management Services

              None

Item 33.      Undertakings


              (1)  The Registrant undertakes to suspend the offering of shares
                   until the prospectus is amended, if subsequent to the
                   effective date of this Registration Statement, its net
                   asset value declines more than ten percent from its net
                   asset value, as of the effective date of the Registration
                   Statement or its net asset value increases to an amount
                   greater than its net proceeds as stated in the prospectus.

              (2)  Not applicable.

              (3)  Not applicable.

              (4)  Not applicable.

              (5)  Registrant undertakes that, for the purpose of determining
                   any liability under the Securities Act, the information
                   omitted from the form of prospectus filed as part of the
                   Registration Statement in reliance upon Rule 430A and
                   contained in the form of prospectus filed by the Registrant
                   pursuant to Rule 497(h) will be deemed to be a part of the
                   Registration Statement as of the time it was declared
                   effective.

                   Registrant undertakes that, for the purpose of determining
                   any liability under the Securities Act, each post-effective
                   amendment that contains a form of prospectus will be deemed
                   to be a new Registration Statement relating to the
                   securities offered therein, and the offering of such
                   securities at that time will be deemed to be the initial
                   bona fide offering thereof.

              (6)  Registrant undertakes to send by first class mail or other
                   means designed to ensure equally prompt delivery, within
                   two business days of receipt of a written or oral request,
                   any Statement of Additional Information constituting Part B
                   of this Registration Statement.



<PAGE>

                             SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended,  and the
Investment  Company Act of 1940, as amended,  the  Registrant has duly caused
this  Amendment to its Registration  Statement  on Form N-2 to be  signed  on
its  behalf  by the undersigned,   thereunto  duly  authorized,  in  the  City
of Boston  and  the Commonwealth of Massachusetts on the 2nd day of August,
2001.

                                      LIBERTY ALL-STAR GROWTH FUND, INC.


                                             /s/ WILLIAM R. PARMENTIER, JR.
                                       By:   ------------------------------
                                             /s/ William R. Parmentier, Jr.
                                                 President

Pursuant to the  requirements of the Securities Act of 1933,  this  Registration
Statement has been signed below by the following persons in their capacities and
on the date indicated.

SIGNATURES                              TITLE                 DATE
----------                              -----                 ----




/s/WILLIAM R. PARMENTIER, JR.       President (chief          August 2, 2001
-----------------------------       executive officer)
/s/William R. Parmentier, Jr.


/s/J. KEVIN CONNAUGHTON             Treasurer and Principal   August 2, 2001
-----------------------              Financial Officer
/s/J. Kevin Connaughton

<PAGE>

ROBERT R. BIRNBAUM*     Director
------------------
Robert R. Birnbaum


JAMES E. GRINNELL*      Director
---------------------
James E. Grinnell


RICHARD W. LOWRY*      Director                       */s/ WILLIAM J. BALLOU
-----------------                                      ----------------------
Richard W. Lowry                                           William J. Ballou
                                                           Attorney-in-fact
                                                           For each Director
                                                           August 2, 2001

WILLIAM E. MAYER*      Director
-----------------
William E. Mayer


JOHN J. NEUHAUSER*     Director
------------------
John J. Neuhauser


JOSEPH R. PALOMBO*     Director
------------------
Joseph R. Palombo




<PAGE>


            INDEX OF EXHIBITS FILED WITH THIS AMENDMENT

Exhibit
Number    Exhibit
--------  --------------------------------------------------

(b)       By-Laws
(d)(2)    Form of Subscription Certificate
(d)(3)    Form of Notice of Guaranteed Delivery
(g)(1)    Management Agreement with Liberty Asset Management Company
(g)(2)    Portfolio Management Agreement with William Blair & Company, L.L.C.
(g)(3)    Portfolio Management Agreement with M.A. Weatherbie & Co., Inc.
(g)(4)    Portfolio Management Agreement with TCW Investment Management
            Company
(k)(4)    Form of Subscription Agreement
(k)(5)    Form of Information Agent Agreement
(l)       Opinion and Consent of Counsel
(n)(1)    Consent of Independent Accountants - PricewaterhouseCoopers LLP
(n)(2)    Consent of Independent Auditors - KPMG, LLP




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