Dreyfus Strategic
      Municipals, Inc.


      SEMIANNUAL REPORT March 31, 2003



                      DREYFUS STRATEGIC MUNICIPALS, INC.

                            PROTECTING YOUR PRIVACY

                               OUR PLEDGE TO YOU

THE FUND IS COMMITTED TO YOUR PRIVACY. On this page, you will find the
Fund's policies and practices for collecting, disclosing, and safeguarding
"nonpublic personal information," which may include financial or other customer
information. These policies apply to individuals who purchase Fund shares for
personal, family, or household purposes, or have done so in the past. This
notification replaces all previous statements of the Fund's consumer privacy
policy, and may be amended at any time. We'll keep you informed of changes as
required by law.

YOUR ACCOUNT IS PROVIDED IN A SECURE ENVIRONMENT. The Fund maintains
physical, electronic and procedural safeguards that comply with federal
regulations to guard nonpublic personal information. The Fund's agents and
service providers have limited access to customer information based on their
role in servicing your account.

THE FUND COLLECTS INFORMATION IN ORDER TO SERVICE AND ADMINISTER YOUR
ACCOUNT. The Fund collects a variety of nonpublic personal information, which
may include:

*    Information we receive from you, such as your name, address, and social
     security number.

*    Information about your transactions with us, such as the purchase or sale
     of Fund shares.

*    Information we receive from agents and service providers, such as proxy
     voting information.

  THE FUND DOES NOT SHARE NONPUBLIC PERSONAL INFORMATION WITH ANYONE, EXCEPT AS
  PERMITTED BY LAW.

  THANK YOU FOR THIS OPPORTUNITY TO SERVE YOU.

The  views  expressed in this report reflect those of the portfolio manager only
through the end of the period covered and do not necessarily represent the views
of  Dreyfus  or any other person in the Dreyfus organization. Any such views are
subject  to change at any time based upon market or other conditions and Dreyfus
disclaims any responsibility to update such views. These views may not be relied
on as investment advice and, because investment decisions for a Dreyfus fund are
based  on  numerous  factors,  may  not be relied on as an indication of trading
intent on behalf of any Dreyfus fund.

            Not FDIC-Insured * Not Bank-Guaranteed * May Lose Value



                                 Contents

                                 THE FUND
--------------------------------------------------

                             2   Letter from the Chairman

                             3   Discussion of Fund Performance

                             6   Statement of Investments

                            17   Statement of Assets and Liabilities

                            18   Statement of Operations

                            19   Statement of Changes in Net Assets

                            20   Financial Highlights

                            22   Notes to Financial Statements

                            29   Officers and Directors

                                 FOR MORE INFORMATION
---------------------------------------------------------------------------

                                 Back Cover

                                                                       The Fund

                                             Dreyfus Strategic Municipals, Inc.

LETTER FROM THE CHAIRMAN

Dear Shareholder:

This  semiannual  report  for  Dreyfus  Strategic  Municipals,  Inc.  covers the
six-month  period  from  October 1, 2002, through March 31, 2003. Inside, you'll
find  valuable  information  about how the fund was managed during the reporting
period,  including  a  discussion  with the fund's portfolio manager, W. Michael
Petty.

A number of economic and political factors continued to support higher municipal
bond  prices during the reporting period. Faced with escalating tensions leading
to  the  start  of  the  war  in  Iraq,  many  investors  preferred fixed-income
securities  over  stocks.  We  believe  that  rising  geopolitical tensions also
contributed   to   the  ongoing  sluggishness  of  the  U.S.  economy,  as  many
corporations  apparently decided to wait until the situation in Iraq is resolved
before  committing  to  new  capital spending. For its part, the Federal Reserve
Board  contributed  to  the municipal bond market's strength by further reducing
short-term interest rates in November 2002.

The  result of these influences has been generally attractive total returns from
high-quality,  tax-exempt  bonds. While history suggests that bond prices should
moderate  if the economy strengthens, we believe that the economy is unlikely to
make significant gains until current uncertainties are resolved.

In  the  meantime,  we  believe  it  is  more  important  than  ever to follow a
disciplined  approach  to  investing.  While  it may be tempting to shift assets
between  stocks  and  bonds in response to near-term economic and market forces,
adherence to your longstanding asset allocation strategy may be the most prudent
course  for  the  long  term. Your financial advisor can help you to ensure that
your  portfolio  reflects  your  investment needs, long-term goals and attitudes
toward risk.

Thank you for your continued confidence and support.

Sincerely,


/s/Stephen E. Canter

Stephen E. Canter
Chairman and Chief Executive Officer
The Dreyfus Corporation
April 15, 2003




DISCUSSION OF FUND PERFORMANCE

W. Michael Petty, Portfolio Manager

How did Dreyfus Strategic Municipals, Inc. perform during the period?

For  the six-month period ended March 31, 2003, the fund achieved a total return
of 0.11%.(1) Over the same period, the fund provided income dividends of $0.3600
per share, which is equal to a distribution rate of 7.53%.(2)

The  municipal bond market exhibited generally strong performance, primarily due
to  the effects of declining interest rates and heightened demand from investors
seeking  stable  alternatives to a declining stock market. However, the positive
effects  of  these  factors  on  the  fund  were  largely  offset  by heightened
volatility among some of its corporate-backed holdings.

What is the fund's investment approach?

The  fund' s  investment  objective  is  to  maximize current income exempt from
federal  income  tax  to the extent consistent with the preservation of capital.
Under  normal market conditions, the fund invests at least 80% of its net assets
in  municipal  obligations.  Generally, the fund invests at least 50% of its net
assets  in municipal bonds considered investment-grade or the unrated equivalent
as determined by Dreyfus.

To  this  end, we have constructed the portfolio by seeking income opportunities
through  analysis  of each bond's structure, including paying close attention to
each bond's yield, maturity and early redemption features.

Over  time,  many  of  the fund's relatively higher-yielding bonds mature or are
redeemed  by their issuers, and we generally attempt to replace those bonds with
what  we  believe  are  comparable securities at then-prevailing yields. When we
believe  an  opportunity  exists,  we  also  may seek to upgrade the portfolio's
investments with newly issued bonds that, in our opinion, have better structural
or income characteristics than existing holdings.

                                                             The Fund


DISCUSSION OF FUND PERFORMANCE (CONTINUED)

What other factors influenced the fund's performance?

The  fund  was  positively influenced by favorable market conditions, which were
generally  the  result  of  a  weak  economy,  falling interest rates and robust
investor   demand   for   high-quality,   fixed-income   securities.  Widespread
allegations  of  corporate  malfeasance  and  heightened  international tensions
further supported investors' preferences for high-quality municipal bonds.

At  the same time, investors generally shunned securities they considered risky,
such  as stocks and bonds issued by or on behalf of corporations. Unfortunately,
the  fund  held  a  number  of  corporate-backed municipal bonds, including some
issued  on  behalf  of airlines. We attempted throughout the reporting period to
reduce  the  fund' s  exposure to corporate-backed bonds and improve its overall
credit quality. We believe that we were successful in doing so. For example, the
fund' s  exposure to the troubled airline sector was trimmed from 7.5% of assets
at  the  start  of  the  reporting period to 3.7% by the reporting period's end.
Similarly,  to  protect  our  shareholders  from  the  potentially  adverse  tax
consequences  of certain holdings, we reduced the fund's position in bonds whose
income is subject to the federal alternative minimum tax (AMT) from 37.2% at the
start of the reporting period to 26.8% by the reporting period's end.

When  opportunities  arose, we looked to replace the fund's corporate-backed and
AMT  holdings  with  higher-quality  securities. As a result, the fund's overall
credit  quality  improved.  When  the  reporting period began, 59% of the fund's
holdings  was  rated single-A or better. By the end of the reporting period, 68%
of  its  holdings  was  rated  single-A  or better. At the top end of the rating
scale, the percentage of the fund's assets rated triple-A rose from 28.5% at the
start of the reporting period to 37% at the reporting period's end.

When making new purchases, we generally avoided states' general obligation bonds
in  favor of essential-services revenue bonds and tax-exempt securities enhanced
with  insurance.(3) In addition, we focused the fund's high-quality purchases on
income-oriented  securities  selling  at  a  modest premium. Historically, these
types  of  bonds  have  offered  greater  defensive characteristics than others


Finally,  the  fund  benefited from our leveraging strategy. Taking advantage of
the  reporting  period' s  low  interest rates, we locked in low borrowing costs
until  2005  on  one  of  the  fund' s  issues  of auction-rate preferred notes

What is the fund's current strategy?

Because  of  ongoing uncertainty related to prevailing geopolitical and economic
factors,  we continue to maintain a generally conservative posture. Accordingly,
we  have  maintained  the  fund' s  average duration at points we consider to be
neutral.  This strategy is designed to provide flexibility to participate in new
opportunities  for  tax-exempt  income  while seeking to provide some protection
from  potential  price  erosion  if economic growth accelerates. In addition, we
recently  have  taken  advantage of what we believe to be opportunities in bonds
from certain states with relatively high income taxes. Known as "specialty state
bonds,"  these  securities  have  recently  been available at prices we consider
attractive relative to non-specialty state bonds. In our view, these are prudent
strategies in today's uncertain economic and geopolitical environments.

April 15, 2003

(1)  TOTAL RETURN INCLUDES REINVESTMENT OF DIVIDENDS AND ANY CAPITAL GAINS PAID,
     BASED UPON NET ASSET VALUE PER SHARE. PAST PERFORMANCE IS NO GUARANTEE OF
     FUTURE RESULTS. MARKET PRICE PER SHARE, NET ASSET VALUE PER SHARE AND
     INVESTMENT RETURN FLUCTUATE. INCOME MAY BE SUBJECT TO STATE AND LOCAL
     TAXES, AND SOME INCOME MAY BE SUBJECT TO THE FEDERAL ALTERNATIVE MINIMUM
     TAX (AMT) FOR CERTAIN INVESTORS. CAPITAL GAINS, IF ANY, ARE FULLY TAXABLE.

(2)  DISTRIBUTION RATE PER SHARE IS BASED UPON DIVIDENDS PER SHARE PAID FROM NET
     INVESTMENT INCOME DURING THE PERIOD, ANNUALIZED, DIVIDED BY THE MARKET
     PRICE PER SHARE AT THE END OF THE PERIOD.

(3)  INSURANCE ON INDIVIDUAL BONDS EXTENDS TO THE REPAYMENT OF PRINCIPAL AND THE
     PAYMENT OF INTEREST IN THE EVENT OF DEFAULT. IT DOES NOT EXTEND TO THE
     MARKET VALUE OF THE PORTFOLIO SECURITIES OR THE VALUE OF THE FUND'S SHARES.

                                                             The Fund

STATEMENT OF INVESTMENTS

March 31, 2003 (Unaudited)






                                                                                              Principal
LONG-TERM MUNICIPAL INVESTMENTS--146.3%                                                       Amount ($)                Value ($)
------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                
ALABAMA--3.5%

Alabama Industrial Development Authority, SWDR

   (Pine City Fiber Co.) 6.45%, 12/1/2023                                                     4,725,000                4,555,467

Houston County Health Care Authority

   6.25%, 10/1/2030 (Insured; AMBAC)                                                          8,000,000                9,180,160

Jefferson County, Sewer Revenue

   5.25%, 2/1/2023 (Insured; FGIC)                                                            5,000,000                5,253,750

ALASKA--1.5%

Alaska Housing Finance Corp.:

   6%, 12/1/2040                                                                                455,000                  480,826

   6%, 6/1/2049 (Insured; MBIA)                                                               4,000,000                4,225,080

Valdez, Marine Terminal Revenue

   (BP Pipelines Inc. Project) 5.65%, 12/1/2028                                               3,200,000                3,254,272

ARKANSAS--3.5%

Arkansas Development Finance Authority, SFMR

  (Mortgage Backed Securities Program):

      6.45%, 7/1/2031 (Guaranteed; GNMA, FNMA)                                                7,060,000                7,542,198

      6.25%, 1/1/2032 (Guaranteed; GNMA)                                                      4,945,000                5,276,315

Little Rock School District

   5.25%, 2/1/2030 (Insured; FSA)                                                             6,000,000                6,206,520

ARIZONA--7.9%

Apache County Industrial Development Authority, PCR

  (Tucson Electric Power Co. Project):

      5.85%, 3/1/2028                                                                         3,800,000                3,462,180

      5.875%, 3/1/2033                                                                        1,325,000                1,210,639

Maricopa Pollution Control Corp., PCR

   (Public Service Co.) 5.75%, 11/1/2022                                                      6,000,000                5,933,700

Pima County Industrial Development Authority, Industrial

   Revenue (Tucson Electric Power Co. Project)
   6%, 9/1/2029                                                                              14,265,000               13,335,207

Scottsdale Industrial Development Authority, HR

   (Scottsdale Healthcare) 5.80%, 12/1/2031                                                   6,000,000                6,127,200

Tempe Industrial Development Authority, IDR

   (California Micro Devices Corp. Project)
   10.50%, 3/1/2018                                                                           6,535,000                6,556,500

Tucson, Water System Revenue

   5%, 7/1/2021 (Insured; FGIC)                                                               3,500,000                3,637,690

University of Arkansas, University Revenue (Fayetteville

   Campus) 5%, 12/1/2027 (Insured; FGIC)                                                      2,000,000                2,049,340


                                                                                              Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED)                                                   Amount ($)                Value ($)
------------------------------------------------------------------------------------------------------------------------------------

CALIFORNIA--5.3%

California Pollution Control Financing Authority, PCR

   (Southern California Edison Co.) 7%, 2/28/2008                                             5,000,000                5,089,200

State of California 9.55%, 12/1/2018 (Insured; FSA)                                          10,000,000  (a,b)        10,372,700

Los Angeles Unified School District

   5.25%, 7/1/2020 (Insured; FSA)                                                             4,000,000                4,313,760

Orange County Water District, Revenue, COP

   5%, 8/15/2028 (Insured; MBIA)                                                              8,840,000                9,015,209

COLORADO--1.4%

Denver City and County, Special Facilities Airport

  Revenue (United Airlines Project)

   6.875%, 10/1/2032                                                                          6,950,000  (d)           1,807,000

El Paso County School District No. 2 (Harrison)

   5%, 12/1/2027 (Insured; MBIA)                                                              2,000,000                2,047,780

Northwest Parkway Public Highway Authority,

   Revenue 7.125%, 6/15/2041                                                                  3,500,000                3,659,530

DELAWARE--1.4%

Delaware Transportation Authority,

  Transportation System Revenue

   5%, 7/1/2019 (Insured; AMBAC)                                                              6,865,000                7,273,811

FLORIDA--5.0%

Florida Housing Finance Corp., Housing Revenue

  (Nelson Park Apartments)

   6.40%, 3/1/2040 (Insured; FSA)                                                            12,380,000               13,321,499

Orange County Health Facility Authority, HR

   (Regional Healthcare Systems) 6%, 10/1/2026                                                2,000,000                2,070,600

Pasco County, Sales Tax Revenue

   (Half-Cent) 5.125%, 12/1/2028 (Insured; AMBAC)                                            10,150,000               10,504,540

South Miami Health Facilities Authority, HR

   (Baptist Health of South Florida Group)
   5.25%, 11/15/2033                                                                            950,000                  942,077

GEORGIA--1.9%

Georgia Housing Finance Authority, SFMR
   6.45%, 12/1/2030                                                                           5,365,000                5,764,961

Private Colleges and Universities Facilities Authority,
   Revenue (Clark Atlanta University Project)

   8.25%, 1/1/2015 (Prerefunded 1/1/2003)                                                     4,127,500  (c)           4,364,831

                                                                                                     The Fund

STATEMENT OF INVESTMENTS (Unaudited) (CONTINUED)

                                                                                              Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED)                                                   Amount ($)                Value ($)
------------------------------------------------------------------------------------------------------------------------------------

HAWAII--1.3%

Hawaii Department of Transportation,
  Special Facility Revenue:

      (Caterair International Corp. Project)
         10.125%, 12/1/2010                                                                   3,600,000                3,606,948

      (Continental Airlines, Inc.)
         5.625%, 11/15/2027                                                                   6,820,000                3,316,566

IDAHO--.8%

Power County Industrial Development Corp, SWDR

   (FMC Corp. Project) 6.45%, 8/1/2032                                                        5,450,000                4,454,885

ILLINOIS--8.0%

Chicago:

   6.125%, 1/1/2028 (Insured; FGIC)                                                          15,815,000               17,978,176

   (Wastewater Transmission Revenue)

      6%, 1/1/2030 (Insured; MBIA)                                                            3,000,000                3,539,370

Chicago-O'Hare International Airport,
   Special Facility Revenue:

      (Delta Airlines Project) 6.45%, 5/1/2018                                                4,855,000                2,239,272

      (United Airlines, Inc. Project):

         6.75%, 11/1/2011                                                                     2,000,000  (d)             240,000

         6.30%, 5/1/2016                                                                     13,450,000  (d)           1,176,875

Illinois Health Facilities Authority, Revenue:

   (Advocate Network Health Care) 6.125%, 11/15/2022                                          4,020,000                4,331,148

   (OSF Healthcare System) 6.25%, 11/15/2029                                                  7,730,000                8,112,480

   (Swedish American Hospital) 6.875%, 11/15/2030                                             4,990,000                5,380,517

INDIANA--2.1%

Franklin Township Independent School Building Corp.,

   First Mortgage 6.125%, 1/15/2022                                                           6,500,000                7,843,355

Indiana Housing Finance Authority, SFMR
   5.95%, 1/1/2029                                                                            3,420,000                3,548,592

KANSAS--3.6%

Kansas Development Finance Authority, Revenue:

  (Board of Regents-Scientific Resource)

      5%, 10/1/2021 (Insured; AMBAC)                                                          5,290,000                5,571,005

   Health Facility (Sisters of Charity) 6.25%, 12/1/2028                                      3,000,000                3,232,140

Wichita, HR (Christian Health System Inc.)

   6.25%, 11/15/2024                                                                         10,000,000               10,713,300

KENTUCKY--1.1%

Kenton County Airport Board, Airport Revenue

  (Special Facilities-Delta Airlines Project)

   6.125%, 2/1/2022                                                                           9,200,000                5,661,680


                                                                                              Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED)                                                   Amount ($)                Value ($)
------------------------------------------------------------------------------------------------------------------------------------

LOUISIANA--2.4%

Greater New Orleans Expressway Commission, Revenue

   5%, 11/1/2027 (Insured; AMBAC)                                                             3,000,000                3,062,190

Parish of Saint James, SWDR (Freeport-McMoRan
   Partnership Project) 7.70%, 10/1/2022                                                     10,000,000                9,674,700

MAINE--.8%

Maine Housing Authority, Mortgage
   5.30%, 11/15/2023                                                                          4,000,000                4,151,360

MARYLAND--1.0%

Baltimore County, PCR

   (Bethlehem Steel Corp. Project) 7.50%, 6/1/2015                                            2,500,000  (d)              93,750

Maryland Economic Development Corp., Student

   Housing Revenue (University of Maryland)
   5.75%, 10/1/2033                                                                           5,000,000                5,031,350

MASSACHUSETTS--4.3%

Massachusetts Industrial Finance Agency, Revenue

   (Ogden Haverhill Project) 5.60%, 12/1/2019                                                 6,000,000                5,491,800

Massachusetts Health and Educational Facilities Authority,

  Revenue:

    (Beth Israel Hospital Issue)

         9.942%, 7/1/2025 (Insured; AMBAC)                                                    3,000,000  (a)           3,137,850

      (Partners Healthcare System) 5.75%, 7/1/2032                                            5,000,000                5,250,000

      (Harvard University Issue) 6%, 7/1/2035                                                 8,000,000                9,530,880

MICHIGAN--4.4%

Michigan Hospital Finance Authority, HR:

   (Ascension Health Credit) 6.125%, 11/15/2026                                               5,000,000                6,017,750

   (Crittenton Hospital) 5.625%, 3/1/2027                                                     2,000,000                2,048,760

   (Genesys Health System Obligated Group)

      8.125%, 10/1/2021 (Prerefunded 10/1/2005)                                               5,000,000  (c)           5,913,000

Michigan Strategic Fund, Resource Recovery Limited

  Obligation Revenue (Detroit Edison Co.)

   5.25%, 12/15/2032                                                                          3,000,000                3,062,670

Michigan Strategic Fund, SWDR

   (Genesee Power Station Project) 7.50%, 1/1/2021                                            7,140,000                6,827,982

MINNESOTA--1.8%

Duluth Economic Development Authority, Health

  Care Facilities Revenue (Saint Luke's

   Hospital) 7.25%, 6/15/2032                                                                 5,000,000                5,005,300

Minnesota Housing Finance Agency, Residential

   Housing Finance 5%, 1/1/2020                                                               4,525,000                4,661,881

                                                                                                     The Fund

STATEMENT OF INVESTMENTS (Unaudited) (CONTINUED)

                                                                                              Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED)                                                   Amount ($)                Value ($)
------------------------------------------------------------------------------------------------------------------------------------

MISSISSIPPI--3.5%

Claiborne County, PCR (Middle South Energy, Inc.)

   (System Energy Resources, Inc.) 6.20%, 2/1/2026                                            4,545,000                4,530,774

Mississippi Business Finance Corp., PCR (System Energy

   Resource Inc. Project) 5.875%, 4/1/2022                                                   14,810,000               14,536,015

MISSOURI--3.3%

Missouri Health and Educational Facilities Authority,

  Health Facilities Revenue (Saint Anthony's

   Medical Center) 6.25%, 12/1/2030                                                           6,750,000                7,059,150

Missouri Development Finance Board, Infrastructure

  Facilities Revenue (Branson):

      5.375%, 12/1/2027                                                                       2,000,000                2,010,320

      5.50%, 12/1/2032                                                                        4,500,000                4,541,625

Saint Louis Industrial Development Authority, Revenue

   (Saint Louis Convention Center) 7.25%, 12/15/2035                                          4,250,000                4,202,655

MONTANA--4.1%

Forsyth, PCR (Puget Sound Energy)

   5%, 3/1/2031 (Insured; AMBAC)                                                             14,225,000               14,518,604

Montana Board of Housing, Single Family Mortgage

   6.45%, 6/1/2029                                                                            7,340,000                7,832,000

NEVADA--2.7%

Washoe County (Reno-Sparks Convention Center)

   6.40%, 7/1/2029 (Insured; FSA)                                                            12,000,000               14,342,040

NEW HAMPSHIRE--2.8%

New Hampshire Business Finance Authority, PCR

  (Public Service Co. of New Hampshire)

   6%, 5/1/2021 (Insured; AMBAC)                                                              7,000,000                7,753,760

New Hampshire Health and Educational Facilities

  Authority, Revenue (Exeter Project):

      6%, 10/1/2024                                                                           1,000,000                1,058,390

      5.75%, 10/1/2031                                                                        1,000,000                1,032,220

New Hampshire Industrial Development Authority, PCR

   (Connecticut Light and Power) 5.90%, 11/1/2016                                             5,000,000                5,129,750

NEW JERSEY--4.6%

New Jersey Economic Development Authority, Special
  Facility Revenue (Continental Airlines Inc. Project)

   6.40%, 9/15/2023                                                                           2,000,000                1,253,480

New Jersey Environmental Infrastructure Trust

   5%, 9/1/2020                                                                               6,330,000                6,665,047

New Jersey Health Facilities Financing Authority,
   Revenue (Christian Health Care Center)
   8.75%, 7/1/2018                                                                           14,180,000               17,035,994


                                                                                              Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED)                                                   Amount ($)                Value ($)
------------------------------------------------------------------------------------------------------------------------------------

NEW MEXICO--1.8%

Farmington, PCR:

  (El Paso Electric Co. Project)

      6.375%, 6/1/2032                                                                        5,370,000                5,439,434

   (Tucson Electric Power Co., San Juan)

      6.95%, 10/1/2020                                                                        4,000,000                4,138,880

NEW YORK--4.0%

Long Island Power Authority, New York
  Electric System Revenue

   8.404% 12/1/2016                                                                          10,000,000  (a,b)        11,363,200

New York Transitional Finance Authority, Revenue

   (Future Tax Secured) 5%, 2/1/2031                                                         10,000,000               10,103,900

NORTH DAKOTA--2.3%

North Dakota Housing Finance Agency,
  Home Mortgage Revenue

    (Housing Finance Program):

         6.50%, 1/1/2031                                                                      8,395,000                8,968,043

         6.15%, 7/1/2031                                                                      3,150,000                3,318,431

OHIO--5.6%

Cuyahoga County , Revenue 6%, 1/1/2032                                                        2,000,000                2,086,120

Mahoning County, Hospital Facilities Revenue

   (Forum Health Obligation Group) 6%, 11/15/2032                                             7,000,000                7,246,890

Ohio Air Quality Development Authority, PCR

  (Cleveland Electric Illuminating)

   6.10%, 8/1/2020 (Insured; ACA)                                                             3,000,000                3,149,640

Ohio Higher Educational Facility Revenue

   (Kenyon College Project) 4.95%, 7/1/2037                                                   5,000,000                5,205,050

Ohio Housing Finance Agency,
   Residential Mortgage Revenue:

      6.25%, 9/1/2020 (Collateralized; GNMA)                                                  3,730,000                3,991,510

      6.35%, 9/1/2031 (Collateralized; GNMA)                                                  3,730,000                3,988,116

Ohio Water Development Authority, Pollution Control

  Facilities Revenue (Cleveland Electric

   Illuminating) 6.10%, 8/1/2020 (Insured; ACA)                                               4,350,000                4,566,978

OKLAHOMA--2.4%

Oklahoma Industries Authority

   (Health System Obligated Group) 5.75%, 8/15/2029                                          12,230,000               13,147,495

OREGON--1.6%

Port of Portland, International Airport Revenue

  (Portland International Airport)

   5.50%, 7/1/2024 (Insured; AMBAC)                                                           5,000,000                5,294,900

                                                                                                     The Fund

STATEMENT OF INVESTMENTS (Unaudited) (CONTINUED)

                                                                                              Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED)                                                   Amount ($)                Value ($)
------------------------------------------------------------------------------------------------------------------------------------

OREGON (CONTINUED)

Tigard--Tualatin School District No. 23

   5.375%, 6/15/2019 (Insured; MBIA)                                                          3,000,000                3,275,010

PENNSYLVANIA--1.9%

Pennsylvania Housing Financing Authority

   10.544%, 4/1/2025                                                                          6,000,000  (a)           6,245,280

York County Hospital Authority, Revenue

   (Health Center--Lutheran Social Services)
   6.50%, 4/1/2022                                                                            4,250,000                4,117,781

SOUTH CAROLINA--2.7%

Greenville Hospital System, Hospital Facilities Revenue

   5.50%, 5/1/2026 (Insured; AMBAC)                                                           5,000,000                5,283,300

Piedmont Municipal Power Agency, Electric Revenue

   6.55%, 1/1/2016                                                                            1,690,000                1,691,724

Tobacco Settlement Revenue Management Authority,

  Tobacco Settlement Revenue:

      6.375%, 5/15/2028                                                                         305,000                  265,335

      6.375%, 5/15/2030                                                                       8,400,000                7,279,860

TENNESSEE--5.4%

Knox County Health Educational and Housing Facilities

  Board, Hospital Facilities Revenue

  (Baptist Health System of Eastern Tennessee)

   6.50%, 4/15/2031                                                                           4,910,000                5,057,496

Memphis Center City Revenue Finance Corp.,
   Tennessee Sports Facility Revenue
   (Memphis Redbirds) 6.50%, 9/1/2028                                                        10,000,000               10,028,800

Tennessee Housing Development Agency
   (Homeownership Program) 6.40%, 7/1/2031                                                   12,770,000               13,870,774

TEXAS--13.5%

Austin Convention Enterprises Inc., Convention Center

  Hotel Revenue:

      5.75%, 1/1/2016                                                                         5,200,000                5,629,780

      6.70%, 1/1/2028                                                                         4,000,000                4,169,520

      5.75%, 1/1/2032                                                                         6,500,000                6,798,870

      6.70%, 1/1/2032                                                                         3,500,000                3,634,295

Harris County Health Facilities Development Corp., HR

  (Memorial Hermann Hospital System Project)

   6.375%, 6/1/2029                                                                           8,500,000                9,082,760


                                                                                              Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED)                                                   Amount ($)                Value ($)
------------------------------------------------------------------------------------------------------------------------------------

TEXAS (CONTINUED)

Houston Airport System, Special Facilities Revenue,

  Airport Improvement (Continental Airlines):

      6.125%, 7/15/2027                                                                       6,375,000                3,099,844

      6.75%, 7/1/2029                                                                         8,250,000                4,383,060

      5.70%, 7/15/2029                                                                        3,750,000                1,748,250

Sabine River Authority, PCR (TXU Electric Co. Project)

   6.45%, 6/1/2021                                                                            8,300,000                8,089,678

Sam Rayburn Municipal Power Agency, Power Supply

   System Revenue 5.75%, 10/1/2021                                                            6,000,000                6,418,980

Texas Department of Housing and Community Affairs,

   Collateralized Home Mortgage Revenue
   12.35%, 7/2/2024                                                                           3,950,000  (a)           4,847,638

Texas Turnpike Authority, Central Texas Turnpike System
   Revenue 5.75%, 8/15/2038 (Insured; AMBAC)                                                  7,100,000                7,752,277

Tomball Hospital Authority, HR
   (Tomball Regional Hospital)
   6%, 7/1/2025                                                                               4,000,000                4,039,680

Tyler Health Facilities Development Corp., HR

  (East Texas Medical Center Regional Health Care

   System Project) 6.75%, 11/1/2025                                                           3,000,000                2,888,970

UTAH--.8%

Carbon County, SWDR (Sunnyside Cogeneration)

   7.10%, 8/15/2023                                                                           4,536,000                4,432,534

VERMONT--1.1%

Vermont Housing Finance Agency, Single Family Housing

   6.40%, 11/1/2030 (Insured; FSA)                                                            5,540,000                5,894,283

VIRGINIA--2.2%

Greater Richmond Convention Center Authority,
   Hotel Tax Revenue (Convention Center
   Expansion Project) 6.25%, 6/15/2032                                                       10,500,000               11,712,645

WASHINGTON--5.7%

Energy Northwest:

   Electric Revenue 10.20%, 7/1/2018 (Insured; MBIA)                                         10,000,000  (a,b)        12,444,100

   Wind Project Revenue 5.875%, 7/1/2020                                                      3,000,000                3,064,110

Public Utility District No. 1 of Pend Orielle County,
   Electric Revenue 6.375%, 1/1/2015                                                          3,755,000                3,996,784

                                                                                                     The Fund

STATEMENT OF INVESTMENTS (Unaudited) (CONTINUED)

                                                                                              Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED)                                                   Amount ($)                Value ($)
------------------------------------------------------------------------------------------------------------------------------------

WASHINGTON (CONTINUED)

Seattle, Water System Revenue

   6%, 7/1/2029 (Insured; FGIC)                                                              10,000,000               11,320,700

WEST VIRGINIA--3.2%

Braxton County, SWDR (Weyerhaeuser Co. Project):

   6.125%, 4/1/2026                                                                          14,000,000               14,172,200

West Virginia Housing Development Fund,
   Housing Finance 6.50%, 5/1/2028                                                              650,000                  693,945

West Virginia Water Development Authority, Water

   Development Revenue 6.375%, 7/1/2039                                                       2,250,000                2,504,678

WISCONSIN--5.7%

Badger Tobacco Asset Securitization Corp., Tobacco

  Settlement Revenue:

      7%, 6/1/2028                                                                           24,000,000               22,816,080

      6.375%, 6/1/2032                                                                        2,500,000                2,185,650

Wisconsin Health and Educational Facilities Authority,
   Health, Hospital and Nursing Home Revenue

   (Aurora Health Care Inc.) 5.60%, 2/15/2029                                                 5,205,000                4,995,395

Wisconsin Housing and Economic Development Authority

   9.845%, 7/1/2025                                                                             900,000  (a,b)           940,887

WYOMING--.9%

Sweetwater County, SWDR (FMC Corp. Project):

   7%, 6/1/2024                                                                               3,150,000                2,820,321

   6.90%, 9/1/2024                                                                            2,000,000                1,769,580

U. S. RELATED--1.5%

Guam Housing Corp., SFMR

   5.75%, 9/1/2031 (Collateralized; FHLMC)                                                      965,000                1,050,875

Puerto Rico Highway and Transportation Authority,
   Transportation Revenue 6%, 7/1/2039                                                        6,000,000                7,165,380

TOTAL LONG-TERM MUNICIPAL INVESTMENTS

   (cost $778,867,988)                                                                                               787,931,594


                                                                                              Principal
SHORT-TERM MUNICIPAL INVESTMENTS--3.4%                                                        Amount ($)                Value ($)
------------------------------------------------------------------------------------------------------------------------------------

ALASKA--2.3%

Valdez, Marine Terminal Revenue, VRDN (Exxon Mobil

   Pipeline Co. Project) 1.10%                                                               12,600,000  (e)          12,600,000

MASSACHUSETTS--.2%

Massachusetts Health and Educational Facilities Authority,

   Revenue, VRDN (Capital Asset Program) 1.15%                                                1,000,000  (e)           1,000,000

NEW YORK--.2%

New York, VRDN 1.15% (Insured; MBIA)                                                          1,200,000  (e)           1,200,000

TEXAS--.7%

Gulf Coast Waste Disposal Authority, PCR, VRDN

   (Amoco Oil Co. Project) 1.10%                                                              3,600,000  (e)           3,600,000

TOTAL SHORT-TERM MUNICIPAL INVESTMENTS

   (cost $18,400,000)                                                                                                 18,400,000
------------------------------------------------------------------------------------------------------------------------------------

TOTAL INVESTMENTS (cost $797,267,988)                                                             149.7%             806,331,594

CASH AND RECEIVABLES (NET)                                                                          3.2%              17,103,175

PREFERRED STOCK, AT REDEMPTION VALUE                                                              (52.9%)           (285,000,000)

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS                                                      100.0%             538,434,769

                                                                                                     The Fund




STATEMENT OF INVESTMENTS (Unaudited) (CONTINUED)

Summary of Abbreviations

ACA                 American Capital Access

AMBAC               American Municipal Bond Assurance
                    Corporation

COP                 Certificate of Participation

FGIC                Financial Guaranty Insurance
                    Company

FHLMC               Federal Home Loan Mortagage
                    Corporation

FNMA                Federal National Mortgage
                    Association

FSA                 Financial Security Assurance

GNMA                Government National Mortgage
                    Association

HR                  Hospital Revenue

IDR                 Industrial Development Revenue

MBIA                Municipal Bond Investors Assurance
                    Insurance Corporation

PCR                 Pollution Control Revenue

SFMR                Single Family Mortgage Revenue

SWDR                Solid Waste Development Revenue

VRDN                Variable Rate Demand Notes




Summary of Combined Ratings (Unaudited)

Fitch                or          Moody's               or        Standard & Poor's                            Value (%)
------------------------------------------------------------------------------------------------------------------------------------
                                                                                                         
AAA                              Aaa                             AAA                                              37.0

AA                               Aa                              AA                                               13.6

A                                A                               A                                                17.4

BBB                              Baa                             BBB                                              12.8

BB                               Ba                              BB                                                7.6

B                                B                               B                                                 1.7

CCC                              Caa                             CCC                                                .2

CC                               Ca                              CC                                                 .2

F1                               Mig1                            SP1                                               2.3

Not Rated( f)                    Not Rated( f)                   Not Rated( f)                                     7.2

                                                                                                                 100.0

(A)  INVERSE FLOATER SECURITY--THE INTEREST RATE IS SUBJECT TO CHANGE
     PERIODICALLY.

(B)  SECURITIES EXEMPT FROM REGISTRATION UNDER RULE 144A OF THE SECURITIES ACT
     OF 1933. THESE SECURITIES MAY BE RESOLD IN TRANSACTIONS EXEMPT FROM
     REGISTRATION, NORMALLY TO QUALIFIED INSTITUTIONAL BUYERS. AT MARCH 31,
     2003, THESE SECURITIES AMOUNTED TO $35,120,891 OR 6.5% OF NET ASSETS
     APPLICABLE TO COMMON SHAREHOLDERS.

(C)  BONDS WHICH ARE PREREFUNDED ARE COLLATERALIZED BY U.S. GOVERNMENT
     SECURITIES WHICH ARE HELD IN ESCROW AND ARE USED TO PAY PRINCIPAL AND
     INTEREST ON THE MUNICIPAL ISSUE AND TO RETIRE THE BONDS IN FULL AT THE
     EARLIEST REFUNDING DATE.

(D)  NON-INCOME PRODUCING SECURITY--INTEREST PAYMENTS IN DEFAULT.

(E)  SECURITIES PAYABLE ON DEMAND. VARIABLE RATE INTEREST--SUBJECT TO PERIODIC
     CHANGE.

(F)  SECURITIES WHICH, WHILE NOT RATED BY FITCH, MOODY'S AND STANDARD & POOR'S,
     HAVE BEEN DETERMINED BY THE MANAGER TO BE OF COMPARABLE QUALITY TO THOSE
     RATED SECURITIES IN WHICH THE FUND MAY INVEST.




SEE NOTES TO FINANCIAL STATEMENTS.


STATEMENT OF ASSETS AND LIABILITIES

March 31, 2003 (Unaudited)

                                                             Cost         Value
--------------------------------------------------------------------------------

ASSETS ($):

Investments in securities--See Statement of
Investments                                           797,267,988   806,331,594

Cash                                                                     68,628

Interest receivable                                                  13,959,313

Receivable for investment securities sold                             8,862,540

Prepaid expenses                                                        467,876

                                                                    829,689,951
--------------------------------------------------------------------------------

LIABILITIES ($):

Due to The Dreyfus Corporation and affiliates                           527,558

Payable for investment securities purchased                           5,120,730

Dividends payable to preferred shareholders                             247,566

Commissions payable                                                       7,062

Accrued expenses                                                        352,266

                                                                      6,255,182
--------------------------------------------------------------------------------

AUCTION PREFERRED STOCK, Series M, T, W, Th and F
  par value $.001 per share (11,400 shares issued
  and outstanding a $25,000 per share liquidation
  preference)--Note 1                                               285,000,000
--------------------------------------------------------------------------------

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS ($)                    538,434,769
--------------------------------------------------------------------------------

COMPOSITION OF NET ASSETS ($):

Common Stock, par value $.001 per share
  (59,703,072 shares issued and outstanding)                             59,703

Paid-in capital                                                     562,775,495

Accumulated undistributed investment income--net                      9,215,063

Accumulated net realized gain (loss) on investments                 (42,679,098)

Accumulated net unrealized appreciation
  (depreciation) on investments                                       9,063,606
--------------------------------------------------------------------------------

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS                        538,434,769
--------------------------------------------------------------------------------

SHARES OUTSTANDING

(500 million shares of $.001 par value Common Stock authorized)      59,703,072

NET ASSET VALUE PER SHARE OF COMMON STOCK ($)                              9.02

SEE NOTES TO FINANCIAL STATEMENTS.

                                                             The Fund

STATEMENT OF OPERATIONS

Six Months Ended March 31, 2003 (Unaudited)

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

INVESTMENT INCOME ($):

INTEREST INCOME                                                     26,117,645

EXPENSES:

Management fee--Note 3(a)                                            3,086,787

Commission fee--Note 1                                                 374,780

Shareholder servicing costs                                             72,955

Custodian fees--Note 3(b)                                               69,922

Shareholders' reports                                                   47,576

Professional fees                                                       42,485

Directors' fees and expenses--Note 3(c)                                 31,351

Registration fees                                                       25,833

Miscellaneous                                                           24,636

TOTAL EXPENSES                                                       3,776,325

INVESTMENT INCOME--NET                                              22,341,320
--------------------------------------------------------------------------------

REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--NOTE 4 ($):

Net realized gain (loss) on investments                            (13,473,393)

Net unrealized appreciation (depreciation) on investments           (5,868,579)

NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS             (19,341,972)

DIVIDENDS ON PREFERRED STOCK                                        (2,221,606)

NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS                   777,742

SEE NOTES TO FINANCIAL STATEMENTS.


STATEMENT OF CHANGES IN NET ASSETS

                                         Six Months Ended
                                           March 31, 2003            Year Ended
                                               (Unaudited)   September 30, 2002
--------------------------------------------------------------------------------

OPERATIONS ($):

Investment income--net                         22,341,320            47,823,496

Net realized gain (loss) on investments       (13,473,393)          (18,783,774)

Net unrealized appreciation
   (depreciation) on investments               (5,868,579)           (2,508,827)

Dividends on Preferred Stock                   (2,221,606)           (4,821,324)

NET INCREASE (DECREASE) IN NET ASSETS
   RESULTING FROM OPERATIONS                      777,742            21,709,571
--------------------------------------------------------------------------------

DIVIDENDS TO COMMON SHAREHOLDERS FROM ($):

INVESTMENT INCOME--NET                        (21,394,278)          (39,168,624)
--------------------------------------------------------------------------------

CAPITAL STOCK TRANSACTIONS ($):

DIVIDENDS REINVESTED                            4,294,118             6,491,435

TOTAL INCREASE (DECREASE) IN NET ASSETS       (16,322,418)          (10,967,618)
--------------------------------------------------------------------------------

NET ASSETS ($):

Beginning of Period                           554,757,187           565,724,805

END OF PERIOD                                 538,434,769           554,757,187

Undistributed investment income--net            9,215,063            10,145,155
--------------------------------------------------------------------------------

CAPITAL SHARE TRANSACTIONS (SHARES):

SHARES ISSUED FOR DIVIDENDS REINVESTED            468,458               685,471

SEE NOTES TO FINANCIAL STATEMENTS.

                                                             The Fund

FINANCIAL HIGHLIGHTS

The  following table describes the performance for the fiscal periods indicated.
Total return shows how much your investment in the fund would have increased (or
decreased)  during  each  period,  assuming you had reinvested all dividends and
distributions.  These  figures  have  been  derived  from  the  fund's financial
statements and market price data for the fund's common shares.





                                          Six Months Ended

                                            March 31, 2003                            Year Ended September 30,
                                                              ----------------------------------------------------------------------

                                                (Unaudited)         2002(a)       2001          2000           1999          1998
------------------------------------------------------------------------------------------------------------------------------------
                                                                                                          
PER SHARE DATA ($):

Net asset value,
   beginning of period                                9.37          9.66          9.38          9.41          10.22         10.02

Investment Operations:

Investment income--net                                 .38(b)        .81(b)        .82           .71            .56           .59

Net realized and unrealized
   gain (loss) on investments                         (.33)         (.35)          .18           .02           (.80)          .25

Dividends on Preferred Stock
   from net investment income                         (.04)         (.08)         (.16)         (.13)            --            --

Total from
   Investment Operations                               .01           .38           .84           .60           (.24)          .84

Distributions to
   Common Shareholders:

Dividends from investment
   income--net                                        (.36)         (.67)         (.56)         (.55)          (.57)         (.64)

Dividends from net realized
   gain on investments                                  --            --            --          (.02)            --            --

Total Distributions to
   Common Shareholders                                (.36)         (.67)         (.56)         (.57)          (.57)         (.64)

Capital Stock transactions,
   net effect of Preferred
   Stock offerings                                      --            --            --          (.06)            --            --

Net asset value, end of period                        9.02          9.37          9.66          9.38           9.41         10.22

Market value, end of period                           9.56         10.11          9.69        8 9_16              8       10 5_16
------------------------------------------------------------------------------------------------------------------------------------

TOTAL RETURN (%)(C)                                  (1.67)(d)     11.89         20.22         14.76         (17.55)         3.35








                                          Six Months Ended
                                            March 31, 2003                                    Year Ended September 30,
                                                                 -------------------------------------------------------------------

                                      (Unaudited)            2002(a)           2001           2000          1999          1998
------------------------------------------------------------------------------------------------------------------------------------
                                                                                                         
RATIOS/SUPPLEMENTAL
   DATA (%):

Ratio of expenses to average
   net assets applicable
   to Common Stock                          1.40(e,f,g)      1.38(f,g)         1.39(f,g)      1.25(f,g)      .84           .85

Ratio of net investment
   income to average
   net assets applicable
   to Common Stock                          8.29(e,f,g)      8.61(f,g)         8.49(f,g)      7.91(f,g)      5.63         5.78

Portfolio Turnover Rate                    22.96(d)         36.81             10.07          19.03          27.05        20.95

Asset coverage of
   Preferred Stock,
   end of Period                             289              294               299            295             --           --
------------------------------------------------------------------------------------------------------------------------------------

Net Assets, net of
   Preferred Stock,
   end of period ($ x 1,000)             538,435          554,757           565,725        548,939        550,755      595,693

Preferred Stock outstanding,
   end of period ($ x 1,000)             285,000          285,000           285,000        285,000             --           --

(A)  AS REQUIRED, EFFECTIVE OCTOBER 1, 2001, THE FUND HAS ADOPTED THE PROVISIONS
     OF THE AICPA AUDIT AND ACCOUNTING GUIDE FOR INVESTMENT COMPANIES AND BEGAN
     AMORTIZING DISCOUNT OR PERMIUM ON A SCIENTIFIC BASIS FOR DEBT SECURITIES ON
     A DAILY BASIS. THE EFFECT OF THIS CHANGE FOR THE PERIOD ENDED SEPTEMBER 30,
     2002 WAS TO INCREASE NET INVESTMENT INCOME PER SHARE AND DECREASE NET
     REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS BY LESS THAN $.01 AND
     INCREASE THE RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS FROM
     8.58% TO 8.61%. PER SHARE DATA AND RATIOS/SUPPLEMENTAL DATA FOR PERIODS
     PRIOR TO OCTOBER 1, 2001 HAVE NOT BEEN RESTATED TO REFLECT THIS CHANGE IN
     PRESENTATION.

(B)  BASED ON AVERAGE SHARES OUTSTANDING AT EACH MONTH END.

(C)  CALUCULATED BASED ON MARKET VALUE.

(D)  NOT ANNUALIZED.

(E)  ANNUALIZED.

(F)  DOES NOT REFLECT THE EFFECT OF DIVIDENDS TO PREFERRED STOCK SHAREHOLDERS.

(G)  THE RATIO OF EXPENSES TO TOTAL AVERAGE NET ASSETS AND THE RATIO OF NET
     INVESTMENT INCOME TO TOTAL AVERAGE NET ASSETS WERE .92% AND 5.43%,
     RESPECTIVELY, FOR THE SIX MONTHS ENDED MARCH 31, 2003, .91% AND 5.69%,
     RESPECTIVELY, FOR THE YEAR ENDED SEPTEMBER 30, 2002, .92% AND 5.65%,
     RESPECTIVELY, FOR THE YEAR ENDED SEPTEMBER 30, 2001 AND .92% AND 5.79%,
     RESPECTIVELY, FOR THE YEAR ENDED SEPTEMBER 30, 2000.




SEE NOTES TO FINANCIAL STATEMENTS.

                                                             The Fund

NOTES TO FINANCIAL STATEMENTS (Unaudited)

NOTE 1-- Significant Accounting Policies:

Dreyfus  Strategic  Municipals,  Inc.  (the  "fund") is  registered  under  the
Investment  Company  Act  of  1940,  as  amended  (the  "Act"), as a diversified
closed-end  management investment company. The fund's investment objective is to
maximize  current income exempt from federal income tax to the extent consistent
with the preservation of capital. The Dreyfus Corporation (the "Manager") serves
as  the  fund's investment adviser. The Manager is a direct subsidiary of Mellon
Bank,  N.A., which is a wholly-owned subsidiary of Mellon Financial Corporation.
The  fund' s Common Stock trades on the New York Stock Exchange under the ticker
symbol LEO.

The fund has outstanding 2,280 shares of Series M, Series T, Series W, Series TH
and  Series  F  for a total of 11,400 shares of Auction Preferred Stock ("APS"),
with  a  liquidation  preference  of  $25,000 per share (plus an amount equal to
accumulated  but  unpaid  dividends  upon  liquidation). APS dividends rates are
determined  pursuant  to  periodic  auctions.  Bankers  Trust, as Auction Agent,
receives  a fee from the fund for its services in connection with such auctions.
The  fund also compensates broker-dealers generally at an annual rate of .25% of
the  purchase  price  of  the  shares  of  APS placed by the broker-dealer in an
auction.

The  fund  is  subject  to  certain restrictions relating to the APS. Failure to
comply  with  these  restrictions  could  preclude  the  fund from declaring any
distributions  to common shareholders or repurchasing common shares and/or could
trigger the mandatory redemption of APS at liquidation value.

The  holders  of the APS, voting as a separate class, have the right to elect at
least  two  directors.  The  holders of the APS will vote as a separate class on
certain  other  matters,  as  required  by law. The fund has designated Robin R.
Pringle  and John E. Zuccotti to represent holders of APS on the fund's Board of
Directors.

The  fund' s  financial  statements  are  prepared in accordance with accounting
principles generally accepted in the United States, which may require the use of
management  estimates  and  assumptions.  Actual results could differ from those
estimates.


(a)  Portfolio valuation: Investments in municipal securities (excluding options
and  financial  futures on municipal and U.S. Treasury securities) are valued on
the  last  business day of each week and month by an independent pricing service
("Service") approved by the Board of Directors. Investments for which quoted bid
prices  are  readily  available  and  are  representative of the bid side of the
market  in the judgment of the Service are valued at the mean between the quoted
bid  prices  (as  obtained  by  the Service from dealers in such securities) and
asked  prices  (as  calculated  by  the Service based upon its evaluation of the
market  for  such securities). Other investments (which constitute a majority of
the  portfolio  securities)  are  carried  at  fair  value  as determined by the
Service,  based  on  methods which include consideration of: yields or prices of
municipal   securities   of  comparable  quality,  coupon,  maturity  and  type;
indications  as  to  values from dealers; and general market conditions. Options
and  financial  futures  on municipal and U.S. Treasury securities are valued at
the  last  sales  price  on the securities exchange on which such securities are
primarily traded or at the last sales price on the national securities market on
the    last    business    day    of    each    week    and    month.

(b)  Securities  transactions and investment income: Securities transactions are
recorded  on  a  trade  date  basis.  Realized  gain  and  loss  from securities
transactions  are  recorded  on  the  identified  cost  basis.  Interest income,
adjusted for amortization of discount and premium on investments, is earned from
settlement  date  and  recognized  on the accrual basis. Securities purchased or
sold  on  a when-issued or delayed-delivery basis may be settled a month or more
after the trade date.

(c)  Dividends  to  shareholders  of  Common  Stock  ("Common Shareholders(s)"):
Dividends  are  recorded  on  the  ex-dividend  date.  Dividends from investment
income-net  are  declared  and paid monthly. Dividends from net realized capital
gain,  if  any,  are  normally declared and paid annually, but the fund may make
distributions  on a more frequent basis to comply with distribution requirements
of  the  Internal  Revenue  Code of 1986, as amended (the "Code"). To the extent
that  net  realized capital gain can be offset by capital loss carryovers, it is
the policy of the fund not to distribute such gain.

                                                             The Fund

NOTES TO FINANCIAL STATEMENTS (Unaudited) (CONTINUED)

For  Common  Shareholders who elect to receive their distributions in additional
shares  of  the  fund, in lieu of cash, such distributions will be reinvested at
the  lower  of  the market price or net asset value per share (but not less than
95%  of  the  market price) based on the record date's respective prices. If the
net  asset value per share on the record date is lower than the market price per
share, shares will be issued by the fund at the record date's net asset value on
the  payable  date of the distribution. If the net asset value per share is less
than  95%  of  the market value, shares will be issued by the fund at 95% of the
market value. If the market price is lower than the net asset value per share on
the  record  date,  The  Bank  of New York will purchase fund shares in the open
market  commencing on the payable date and reinvest those shares accordingly. As
a  result  of purchasing fund shares in the open market, fund shares outstanding
will not be affected by this form of reinvestment.

On  March  31,  2003,  the Board of Directors declared a cash dividend to Common
Shareholders of $.060 per share from investment income-net, payable on April 28,
2003  to  Common Shareholders of record as of the close of business on April 14,
2003.

(d)  Dividends  to  shareholders  of APS: For APS, dividends are currently reset
every  7 days for Series M and Series Th. The dividend rate for Series T will be
in  effect until July 21, 2003. The dividend rate for Series W will be in effect
until  December  4, 2003. The dividend rate for Series F will be in effect until
February  14,  2005.  The  dividend  rates  in  effect at March 31, 2003 were as
follows:  Series  M-.90% , Series  T-1.75% , Series W-1.65%, Series TH-1.10% and
Series F-1.64%.

(e) Federal income taxes: It is the policy of the fund to continue to qualify as
a  regulated  investment  company, which can distribute tax exempt dividends, by
complying  with  the applicable provisions of the Code and to make distributions
of  income  and  net  realized  capital  gain  sufficient  to  relieve  it  from
substantially all federal income and excise taxes.

The  fund  has unused capital loss carryover of $9,912,633 available for federal
tax   purposes   to   be   applied   against  future  net  securities  profits,

if any, realized subsequent to September 30, 2002. If not applied, $9,836,505 of
the carryover expires in fiscal 2009 and $76,128 expires in fiscal 2010.

The  tax  character of distributions paid to shareholders during the fiscal year
ended  September 30, 2002 was as follows: tax exempt income $43,989,948. The tax
character  of  current  year  distributions will be determined at the end of the
current fiscal year.

NOTE 2--Bank Line of Credit:

The  fund  participates  with  other  Dreyfus-managed  funds  in  a $100 million
unsecured  line  of  credit  primarily to be utilized for temporary or emergency
purposes.  Interest  is  charged to the fund based on prevailing market rates in
effect  at  the  time of borrowings. During the period ended March 31, 2003, the
fund did not borrow under the line of credit.

NOTE 3--Management Fee and Other Transactions With Affiliates:

(a)  Pursuant  to  a  management  agreement  ("Agreement") with the Manager, the
management  fee  is computed at the annual rate of .75 of 1% of the value of the
fund's average weekly net assets and is payable monthly. The Agreement provides
for  an  expense  reimbursement  from  the  Manager  should the fund's aggregate
expenses,   exclusive   of   taxes,   interest   on  borrowings,  brokerage  and
extraordinary  expenses,  in  any  full fiscal year exceed the lesser of (1) the
expense  limitation  of any state having jurisdiction over the fund or (2) 2% of
the  first $10 million, 1 1_2% of the next $20 million and 1% of the excess over
$30  million  of  the  average value of the fund's net assets. During the period
ended  March  31,  2003,  there  was  no  expense  reimbursement pursuant to the
Agreement.

(b)  The fund compensates Boston Safe Deposit and Trust Company, an affiliate of
the  Manager,  under a custody agreement for providing custodial services to the
fund. During the period ended March 31, 2003, $69,922 was charged by Boston Safe
Deposit and Trust Company pursuant to the custody agreement.

                                                             The Fund

NOTES TO FINANCIAL STATEMENTS (Unaudited) (CONTINUED)

(c)  Through January 27th, 2003, each director who is not an "affiliated person"
as  defined  in  the  Act  received from the fund an annual fee of $4,500 and an
attendance  fee  of  $500 per meeting. Each such director also serves as a board
member  of  other  Funds  within  the  Dreyfus  complex (collectively, the "Fund
Group" ). After  January 27th, 2003, Board compensation was changed from a "Fund
by  Fund"  basis  to  a  "Fund  Group"  basis,  such that each such director now
receives  an  annual  fee of $30,000 and an attendance fee of $4,000 for each in
person  meeting  and $500 for telephone meetings. These fees are allocated among
the  funds  in  the Fund Group. The Chairman of the Board receives an additional
25%  of  such  compensation.  Subject to the fund's Emeritus Program Guidelines,
Emeritus  Board  members, if any, receive 50% of the annual retainer fee and per
meeting fee paid at the time the Board member achieves emeritus status.

NOTE 4--Securities Transactions:

The  aggregate amount of purchases and sales of investment securities, excluding
short-term  securities,  during  the  period  ended  March 31, 2003, amounted to
$182,965,922 and $182,708,471, respectively.

At  March  31,  2003, accumulated net unrealized appreciation on investments was
$9,063,606,   consisting   of  $40,965,531  gross  unrealized  appreciation  and
$31,901,925 gross unrealized depreciation.

At  March  31, 2003, the cost of investments for Federal income tax purposes was
substantially  the  same  as  the cost for financial reporting purposes (see the
Statement of Investments).


NOTES

OFFICERS AND DIRECTORS
Dreyfus Strategic Municipals, Inc.

200 Park Avenue
New York, NY 10166

DIRECTORS

Joseph S. DiMartino

David W. Burke

William Hodding Carter, III

Ehud Houminer

Richard C. Leone

Hans C. Mautner

Robin A. Pringle(*)

John E. Zuccotti(*)

* AUCTION PREFERRED STOCK DIRECTORS

OFFICERS

President
      Stephen E. Canter

Vice President
      Mark N. Jacobs

Executive Vice Presidents
      Stephen Byers
      Paul Disdier

Secretary
      John B. Hammalian

Assistant Secretaries
      Steven F. Newman
      Michael A. Rosenberg

Treasurer
      James Windels

Assistant Treasurers
      Gregory S. Gruber
      Kenneth J. Sandgren

Anti-Money Laundering Compliance Officer

      William Germenis

PORTFOLIO MANAGERS:

Joseph P. Darcy

A. Paul Disdier

PORTFOLIO MANAGERS (CONTINUED)

Douglas J. Gaylor

Joseph A. Irace

Colleen A. Meehan

W. Michael Petty

Scott Sprauer

James Welch

Monica S. Wieboldt

INVESTMENT ADVISER

The Dreyfus Corporation

CUSTODIAN

Boston Safe Deposit
and Trust Company

COUNSEL

Stroock & Stroock & Lavan LLP

TRANSFER AGENT,
DIVIDEND DISBURSING AGENT
AND REGISTRAR

The Bank of New York (Common Stock)
Bankers Trust (Auction Preferred Stock)

AUCTION AGENT
Bankers Trust (Auction Preferred Stock)

STOCK EXCHANGE LISTING
NYSE Symbol: LEO

INITIAL SEC EFFECTIVE DATE
9/23/87

THE NET ASSET VALUE APPEARS IN THE  FOLLOWING PUBLICATIONS: BARRON'S, CLOSED-END
BOND FUNDS SECTION UNDER THE HEADING "MUNICIPAL BOND FUNDS" EVERY MONDAY; WALL
STREET JOURNAL, MUTUAL FUNDS SECTION UNDER THE HEADING "CLOSED-END BOND FUNDS"
EVERY MONDAY; NEW YORK TIMES, BUSINESS SECTION UNDER THE HEADING "CLOSED-END
BOND FUNDS--NATIONAL MUNICIPAL BOND FUNDS" EVERY SUNDAY.

NOTICE IS HEREBY GIVEN IN ACCORDANCE WITH SECTION 23(C) OF THE INVESTMENT
COMPANY ACT OF 1940, AS AMENDED, THAT THE FUND MAY PURCHASE SHARES OF ITS COMMON
STOCK IN THE OPEN MARKET WHEN IT CAN DO SO AT PRICES BELOW THE THEN CURRENT NET
ASSET VALUE PER SHARE.

                                                             The Fund


                 For More Information

                        Dreyfus Strategic
                        Municipals, Inc.
                        200 Park Avenue
                        New York, NY 10166

                        Manager

                        The Dreyfus Corporation
                        200 Park Avenue
                        New York, NY 10166

                        Custodian

                        Boston Safe Deposit and
                        Trust Company
                        One Boston Place
                        Boston, MA 02108

                        Transfer Agent &
                        Dividend Disbursing Agent
                        and Registrar
                        (Common Stock)

                        The Bank of New York
                        101 Barclay Street
                        New York, NY 10286

(c) 2003 Dreyfus Service Corporation                                  853SA0303