Edgar Filing: MORGAN STANLEY QUALITY MUNICIPAL INCOME TRUST

N-Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED
MANAGEMENT INVESTMENT COMPANY

Investment Company Act file number: 811-06591

Morgan Stanley Quality Municipal Income Trust

(Exact name of registrant as specified in charter)


522 Fifth Avenue, New York, New York (Address of principal executive offices)		10036 (Zip code)

Randy Takian
522 Fifth Avenue, New York, New York 10036

(Name and address of agent for service)

Registrant’s telephone number, including area code: 212-296-6963

Date of fiscal year end: October 31, 2009

Date of reporting period: January 31, 2009

Item 1. Schedule of Investments.

The Trust’s schedule of investments as of the close of the reporting period prepared pursuant to Rule 12-12 of Regulation S-X is as follows:

Morgan Stanley Quality Municipal Income Trust
Portfolio of Investments January 31, 2009 (unaudited)


PRINCIPAL
AMOUNT IN			COUPON			MATURITY
THOUSANDS			RATE			DATE			VALUE
		Tax-Exempt Municipal Bonds (180.1%)
		Alabama (1.5%)
$	3,700	University of Alabama, Ser 2004-A (MBIA Insd)		5.25	%		07/01/22		$	3,853,661


		Alaska (0.8%)
	4,000	Northern Tobacco Securitization Corporation, Asset Backed Ser 2006 A		5.00			06/01/46			2,086,480


		Arizona (6.1%)
	2,000	Arizona Transportation Board, Highway Refg Ser 2002 A		5.25			07/01/19			2,195,040
	3,000	Phoenix Civic Improvement Corporation, Airport Ser 2002 B (AMT) (FGIC Insd)		5.25			07/01/32			2,470,950
	3,800	Phoenix Civic Improvement Corporation, Jr Lien Water Ser 2002 (FGIC Insd)		5.00			07/01/26			3,730,536
	6,000	Salt River Project Agricultural Improvement & Power District, 2002 Ser B (a)		5.00			01/01/31			6,061,209
	2,000	Surprise Municipal Property Corporation Ser 2007		4.90			04/01/32			1,394,720

										15,852,455


		California (29.4%)
	2,000	California Health Facilities Financing Authority, Cedars-Sinai Medical Center Ser 2005		5.00			11/15/34			1,669,340
	2,000	California Health Facilities Financing Authority, Kaiser Permanente Ser 2006 A		5.25			04/01/39			1,677,920
	5,000	California Infrastructure & Economic Development Bank, Bay Area Toll Bridges First Lien Ser 2003 (a)		5.00			01/01/28	(b)		5,763,487
	3,000	California Infrastructure & Economic Development Bank, The Scripps Research Institute Ser 2005 A		5.00			07/01/29			2,950,860
	6,000	California Pollution Control Financing Authority, Keller Canyon Landfill Co/Browning-Ferris Industries Inc Ser 1992 (AMT)		6.875			11/01/27			5,362,380
	10,000	California State Economic Recovery Ser 2004 A (a)		5.00			07/01/16			10,354,200
	4,000	California Statewide Communities Development, Baptist University Ser 2007 A		5.40			11/01/27			2,552,160
	5,000	California Statewide Communities Development, John Muir Health Ser 2006 A		5.00			08/15/32			4,292,300
	5,000	California, Various Purpose Dtd 05/01/03		5.25			02/01/19			5,201,101
	5,740	California, Various Purpose Dtd 11/01/06		4.50			10/01/36			4,717,476
	6,000	Golden State Tobacco Securitization Corporation, Enhanced Asset Backed Ser 2005 A (AMBAC Insd)		5.00			06/01/29			5,161,320
	4,000	Golden State Tobacco Securitization Corporation, Enhanced Asset Backed Ser 2007 A		5.75			06/01/47			2,416,200
	8,000	Golden State Tobacco Securitization Corporation, Enhanced Asset Backed Ser 2007 A-1		5.125			06/01/47			4,302,720
	4,000	Los Angeles Ser 2004 A (MBIA Insd)		5.00			09/01/24			4,111,600
	4,000	Port of Oakland Ser 2002 L (AMT) (FGIC Insd)		5.00			11/01/32			3,098,760
	1,000	San Diego County, Burnham Institute for Medical Research Ser 2006 (COPs)		5.00			09/01/34			647,080
	3,720	San Diego County Water Authority Ser 2002 A (COPs) (MBIA Insd)		5.00			05/01/27			3,731,011
	960	San Francisco City and County, Laguna Honda Hospital Refg Ser 2008 R3 (AGC Insd) (a)		5.00			06/15/28			958,166
	16,000	Silicon Valley Tobacco Securitization Authority Tobacco Settlement, Santa Clara Tobacco Securitization Corp Ser 2007 (g)		0.00			06/01/36			952,960
	5,000	Tobacco Securitization Authority of Northern California, Sacramento County Tobacco Securitization Corporation Ser 2006 A-1		5.00			06/01/37			2,747,950
	2,760	University of California Ser 2007-J (FSA Insd) (a)		4.50			05/15/31			2,430,235
	2,240	University of California Ser 2007-J (FSA Insd) (a)		4.50			05/15/35			1,936,839

										77,036,065


		Colorado (3.3%)
	1,750	Boulder County, University Corp for Atmospheric Research Ser 2002 (MBIA Insd)		5.375			09/01/18			1,881,004
	1,750	Boulder County, University Corp for Atmospheric Research Ser 2002 (MBIA Insd)		5.375			09/01/21			1,856,173
	2,000	Colorado Educational & Cultural Facilities Authority, Peak to Peak Charter School Refg & Impr Ser 2004 (XLCA Insd)		5.25			08/15/34			1,812,420
	2,000	Colorado Health Facilities Authority, Adventist/Sunbelt Ser 2006 D		5.25			11/15/35			1,677,860
	1,590	Denver Convention Center Hotel Authority, Refg Ser 2006 (XLCA Insd)		5.00			12/01/30			1,216,286


PRINCIPAL
AMOUNT IN			COUPON		MATURITY
THOUSANDS			RATE		DATE		VALUE
	265	Public Authority For Colorado Energy, Natural Gas Ser 2008		6.25		11/15/28		215,315

								8,659,058

		Connecticut (1.6%)
	5,000	Connecticut Housing Finance Authority, SubSer A-2 (AMT)		5.15		05/15/38		4,285,400


		Delaware (0.2%)
	1,000	New Castle County, Newark Charter School Inc Ser 2006		5.00		09/01/36		589,040


		District of Columbia (1.9%)
	6,000	District of Columbia Ballpark Ser 2006 B-1 (FGIC Insd)		5.00		02/01/31		4,911,960


		Florida (6.9%)
	2,000	Broward County School Board, Ser 2001 A (COPs) (FSA Insd)		5.00		07/01/26		1,961,180
	3,000	Highlands County Health Facilities Authority, Adventist Health/Sunbelt Ser 2006 C		5.25		11/15/36		2,537,422
	3,300	Jacksonville Electric Authority, St Johns Power Park Refg Issue 2 Ser 17		5.00		10/01/18		3,415,830
	1,500	Lee County Industrial Development Authority, Shell Point Village/The Alliance Community for Retirement Living Inc, Ser 2006		5.125		11/15/36		806,625
	12,000	South Miami Health Facilities Authority, Baptist Health South Florida Ser 2007		5.00		08/15/42		9,256,320

								17,977,377

		Georgia (4.7%)
	3,000	Atlanta, Airport Ser 2004 J (FSA Insd)		5.00		01/01/34		2,868,180
	6,000	Georgia State Road & Tollway Authority Ser 2004		5.00		10/01/22		6,308,520
	3,000	Georgia State Road & Tollway Authority Ser 2004		5.00		10/01/23		3,128,670

								12,305,370

		Hawaii (7.3%)
	8,000	Hawaii, 1992 Ser BZ		6.00		10/01/11		8,924,960
	10,000	Honolulu City & County Ser 2003 A (MBIA Insd) (a)		5.25		03/01/26		10,138,800

								19,063,760

		Idaho (1.4%)
	50	Idaho Housing Agency, 1992 Ser E (AMT)		6.75		07/01/12		50,098
	760	Idaho Housing & Finance Association, 2000 Ser E (AMT)		6.00		01/01/32		748,706
	2,600	Idaho Housing & Finance Association 2008 Ser A		5.25		07/15/23		2,818,426

								3,617,230

		Illinois (4.7%)
	4,000	Chicago, O’ Hare Int’l Airport Third Lien Ser 2003 B-2 (AMT) (FSA Insd)		5.75		01/01/23		3,917,360
	6,000	Illinois, First Ser 2002 (MBIA Insd)		5.375		07/01/20		6,332,640
	2,000	Schaumburg Ser 2004 B (FGIC Insd)		5.25		12/01/34		2,009,820

								12,259,820

		Indiana (6.1%)
	10,000	Indiana Bond Bank, Revolving Fund Ser 2001 A		5.00		02/01/23		10,306,200
	6,000	Indiana Health & Educational Facility Financing Authority, Clarian Health Ser 2006 A		5.25		02/15/40		4,341,360
	1,400	Marion County Convention & Recreational Facilities Authority, Refg Ser 2003 A (AMBAC Insd)		5.00		06/01/21		1,449,518

								16,097,078

		Kansas (0.9%)
	3,000	University of Kansas Hospital Authority, KU Health Ser 2002		4.50		09/01/32		2,324,370


		Kentucky (1.9%)
	5,000	Louisville & Jefferson County Metropolitan Sewer District, Ser 1999 A (FGIC Insd)		5.75		05/15/33		5,036,600


		Maryland (2.8%)
	2,000	Baltimore County, Oak Crest Village Ser 2007 A		5.00		01/01/37		1,414,120
	3,000	Maryland Health & Higher Educational Facilities Authority, King Farm Presbyterian Community 2006 Ser B		5.00		01/01/17		2,273,250
	2,000	Maryland Health & Higher Educational Facilities Authority, University of Maryland Medical Ser 2006 A		5.00		07/01/41		1,599,760
	2,000	Northeast Maryland Waste Disposal Authority, Montgomery County Ser 2003 (AMT) (AMBAC Insd)		5.50		04/01/16		2,074,980

								7,362,110

		Michigan (5.0%)
	6,000	Michigan Hospital Finance Authority, Henry Ford Health Refg Ser 2006 A		5.25		11/15/46		3,937,500
	5,000	Michigan Strategic Fund, Detroit Edison Co Ser 2001 C (AMT)		5.65		09/01/29		4,202,400
	3,000	Wayne County, Detroit Metropolitan Wayne County Airport Refg Ser 2002 D (AMT) (FGIC Insd)		5.50		12/01/17		3,015,810
	1,855	Wayne State University, Refg Ser 2008 (FSA Insd)		5.00		11/15/25		1,911,522

								13,067,232

		Minnesota (0.7%)


PRINCIPAL
AMOUNT IN			COUPON		MATURITY
THOUSANDS			RATE		DATE		VALUE
	2,000	Western Minnesota Municipal Power Agency, 2003 Ser A (MBIA Insd)		5.00		01/01/30		1,893,160


		Missouri (1.0%)
	2,250	Gravois Bluffs Transportation Development District, Sales Tax Ser 2007		4.75		05/01/32		1,508,603
	1,500	Missouri Health & Educational Facilities Authority, Lutheran Senior Services Ser 2005 A		5.375		02/01/35		1,053,855
	165	Missouri Housing Development Commission, Homeownership Ser 2000 B-1 (AMT)		6.25		03/01/31		170,960

								2,733,418

		Montana (1.1%)
	2,825	Montana Board of Housing, 2000 Ser B (AMT)		6.00		12/01/29		2,861,245


		Nevada (5.0%)
	2,000	Clark County, Airport SubLien Ser 2004 A-1 (AMT) (FGIC Insd)		5.50		07/01/20		1,965,840
	1,000	Clark County, Jet Aviation Fuel Tax Ser 2003 C (AMT) (AMBAC Insd)		5.375		07/01/19		993,260
	1,100	Clark County, Jet Aviation Fuel Tax Ser 2003 C (AMT) (AMBAC Insd)		5.375		07/01/20		1,070,685
	2,000	Clark County, Jet Aviation Fuel Tax Ser 2003 C (AMT) (AMBAC Insd)		5.375		07/01/22		1,873,540
	5,345	Las Vegas Valley Water District, Water Impr Refg Ser 2003 A (FGIC Insd)		5.25		06/01/20		5,639,082
	2,000	Reno, Renown Regional Medical Center Ser 2007 A		5.25		06/01/37		1,456,960

								12,999,367

		New Hampshire (0.2%)
	655	New Hampshire Business Finance Authority, Ser 2009		7.125		07/01/27		656,657


		New Jersey (10.0%)
	2,000	New Jersey Economic Development Authority, Cigarette Tax Ser 2004		5.75		06/15/29		1,496,200
	1,565	New Jersey Housing Mortgage Finance Authority, Home Buyer Ser 2000 CC (AMT) (MBIA Insd)		5.875		10/01/31		1,530,163
	5,000	New Jersey Transportation Trust Fund Authority, 1999 Ser A		5.75		06/15/20		5,741,300
	2,500	New Jersey Turnpike Authority, Ser 2003 A (FGIC Insd) (c)		5.00		01/01/27		2,488,175
	10,000	Passaic Valley Sewerage Commissioners Ser F (FGIC Insd)		5.00		12/01/20		9,549,200
	5,000	Tobacco Settlement Financing Corporation Ser 2007-1 A		4.625		06/01/26		3,192,550
	6,000	Tobacco Settlement Financing Corporation Ser 2007-1 B (g)		0.00		06/01/41		194,520
	2,000	University of Medicine & Dentistry Ser 2004 (COPs) (MBIA Insd)		5.25		06/15/23		1,887,060

								26,079,168

		New Mexico (1.2%)
	3,000	Rio Rancho, Water & Wastewater Refg Ser 1999 (AMBAC Insd)		5.25		05/15/19		3,021,420


		New York (25.1%)
	10,000	Metropolitan Transportation Authority, Transportation Refg Ser 2002 A (FGIC Insd)		5.00		11/15/25		10,006,100
	5,000	Nassau County Tobacco Settlement Corporation Ser 2006 A-3		5.125		06/01/46		3,088,100
	2,380	New York City, 2009 Subser A-1 (a)		5.25		08/15/27		2,373,624
	2,380	New York City, 2009 Subser A-1 (a)		5.25		08/15/28		2,373,624
	3,500	New York City Municipal Water Finance Authority, Ser A-2003		5.375		06/15/19		3,717,350
	18,000	New York City Municipal Water Finance Authority, 2002 Ser B (a)		5.00		06/15/26		18,086,940
	10,000	New York City Municipal Water Finance Authority, 2004 Ser A		5.00		06/15/35		9,589,500
	1,935	New York City Trust for Cultural Resources, Museum of Modern Art Refg Ser 2008 1A (a)		5.00		04/01/26		1,961,658
	2,815	New York City Trust for Cultural Resources, Museum of Modern Art Refg Ser 2008 1A (a)		5.00		04/01/27		2,853,782
	2,000	Seneca Nation of Indians Ser 2007 A (d)		5.00		12/01/23		1,151,720
	5,000	Tobacco Settlement Financing Corporation, State Contingency Ser 2003 B-1C		5.50		06/01/17		5,142,900
	5,000	Triborough Bridge & Tunnel Authority Refg 2002 E (MBIA Insd) (a)		5.25		11/15/22		5,235,954

								65,581,252

		North Carolina (1.8%)
	4,500	Charlotte, Water & Sewer Ser 2001		5.125		06/01/26		4,592,385


		North Dakota (0.7%)
	2,750	Ward County, Trinity Ser 2006		5.125		07/01/29		1,874,400


		Ohio (6.0%)
	5,100	American Municipal Power — Ohio, Inc., Prairie State Energy Campus Ser 2008 A (AGC Insd) (a)		5.25		02/15/33		5,082,814
	5,370	Cuyahoga County, Cleveland Clinic Ser 2003 A		6.00		01/01/32		5,359,743
	3,000	Lorain County, Catholic Healthcare Partners Ser 2001 A		5.625		10/01/17		3,150,480
	2,000	Ohio State University, General Receipts Ser 2002 A		5.125		12/01/31		1,998,520

								15,591,557

		Oklahoma (0.4%)
	1,500	Oklahoma Development Finance Authority, Great Plains Medical Center Ser 2007		5.125		12/01/36		994,440


		Pennsylvania (0.8%)


PRINCIPAL
AMOUNT IN			COUPON			MATURITY
THOUSANDS			RATE			DATE		VALUE
	4,000	Allegheny County Redevelopment Authority, West Penn Allegheny Health Ser 2007 A		5.375			11/15/40		2,087,200

		South Carolina (5.9%)
	3,000	Charleston Educational Excellence Financing Corporation, Charleston County School District Ser 2005		5.25			12/01/29		2,889,420
	70	Lexington County Health Services District, Lexmed Inc, Ser 2007 A		5.00			11/01/16		73,385
	5,000	South Carolina Public Service Authority, Refg Ser 2002 D (FSA Insd)		5.00			01/01/20		5,299,050
	7,000	South Carolina Public Service Authority, Refg Ser 2003 A (AMBAC Insd) (a)		5.00			01/01/22		6,900,440
	345	Richland County, Environmental Improvement, International Paper Company Ser 2007A		4.60			09/01/12		311,563

									15,473,858

		Tennessee (2.9%)
	2,000	Sullivan County Health Educational & Housing Facilities Board, Wellmont Health Ser 2006 C		5.25			09/01/36		1,174,860
	8,000	Tennessee Energy Acquisition Corporation Ser 2006 A		5.25			09/01/19		6,460,400

									7,635,260

		Texas (22.4%)
	2,000	Alliance Airport Authority, Federal Express Corp Refg Ser 2006 (AMT)		4.85			04/01/21		1,503,280
	10,000	Austin, Water & Wastewater Rrfg Sec 2001 A & B (FSA Insd) (a)		5.125			05/15/27		10,053,475
	5,100	Board of Regents of the University of Houston System Ser 2008 (FSA Insd) (a)		5.00			02/15/33		5,015,901
	6,000	Houston, Airport Sub Lien Ser 2000 A (AMT) (FSA Insd)		5.875			07/01/17		6,093,779
	5,000	Houston, Airport Sub Lien Ser 2000 A (AMT) (FSA Insd)		5.625			07/01/30		4,487,000
	12,800	Houston, Combined Utility First Lien Refg 2004 Ser A (FGIC Insd)		5.25			05/15/23		13,005,568
	8,600	North Texas Tollway Authority Refg First Tier Ser 2008 D (g)		0.00			01/01/28		2,679,330
	13,960	San Antonio, Water & Refg Ser 2001 (FGIC Insd)		5.00			05/15/26		13,959,023
	2,000	Tarrant County Cultural Educational Facilities Finance Corp, Air Force Village II Inc Ser 2007		5.125			05/15/37		1,262,580
	530	Taxas Municipal Gas Acquisition and Supply Corp. Ser 2008 D		6.25			12/15/26		442,529

									58,502,465

		Vermont (0.5%)
	2,500	Vermont Economic Development Authority, Wake Robin Corp Ser 2006 A		5.375			05/01/36		1,385,350


		Virginia (1.3%)
	2,000	Fairfax County Economic Development Authority, Goodwin House Inc Ser 2007		5.125			10/01/42		1,140,800
	1,450	Henrico County Economic Development Authority, Residential Care Facility, Westminster Canterbury-Management Corp Ser 2006		5.00			10/01/27		1,064,895
	1,750	Henrico County Economic Development Authority, Residential Care Facility, Westminster Canterbury-Management Corp Ser 2006		5.00			10/01/35		1,161,317

									3,367,012

		Washington (6.6%)
	5,000	Energy Northwest, Columbia Refg Ser 2001 C (MBIA Insd)		5.75			07/01/18		5,458,899
	5,000	Grant County Public Utility District #2, Electric Refg Ser 2001 H (FSA Insd)		5.375			01/01/18		5,319,350
	4,010	Port of Seattle, Passenger Facility Ser 1998 A (MBIA Insd)		5.00			12/01/23		3,867,244
	2,500	Spokane School District #81 Ser 2005 (MBIA Insd) (g)		0.00	(e)		06/01/23		2,605,875

									17,251,368


		Total Tax-Exempt Municipal Bonds (Cost $513,059,760)							470,966,048

NUMBER OF

SHARES (000)

Short-Term Investment (f) (0.9%)

Investment Company

2,390

Morgan Stanley Institutional Liquidity Funds — Tax-Exempt Portfolio — Institutional Class (Cost $2,389,616)

2,389,616

Total Investments
(Cost $515,449,376)

473,355,664


PRINCIPAL
AMOUNT IN
THOUSANDS
			Floating Rate Note and Dealer Trust Obligations Related to Securities Held (-24.2%)
$	(63,194	)	Notes with interest rates ranging from 0.43% to 1.53% at January 31, 2009 and contractual maturities of collateral ranging from 07/01/16 to 05/15/35 (h) (Cost ($63,194,000))				(63,194,000	)


			Total Net Investments (Cost $452,255,376) (i) (j)	156.8	%		410,161,664
			Other Assets in Excess of Liabilities	2.3			5,904,685

			Preferred Shares of Beneficial Interest	(59.1	)		(154,500,000	)


			Net Assets Applicable to Common Shareholders	100.0	%	$	261,566,349

Note: The categories of investments are shown as a percentage of net assets applicable to common shareholders.


	AMT		Alternative Minimum Tax.

	COPs		Certificates of Participation.

	(a)		Underlying security related to inverse floater entered into by the Fund.

	(b)		Prerefunded to call date shown.

	(c)		A portion of this security has been physically segregated in connection with open futures contracts in the amount of $1,450,300.

	(d)		Resale is restricted to qualified institutional investors.

	(e)		Security is a “Step-up” bond where the coupon increases on a predetermined future date.

	(f)		The Fund invests in Morgan Stanley Institutional Liquidity Funds — Tax-Exempt Portfolio — Institutional Class, an open-end management investment company managed by the Investment Adviser. Investment Advisory fees paid by the Fund are reduced by an amount equal to the advisory and administrative service fees paid by Morgan Stanley Institutional Liquidity Funds — Tax-Exempt Portfolio — Institutional Class with respect to assets invested by the Fund in Morgan Stanley Institutional Liquidity Funds — Tax-Exempt Portfolio — Institutional Class .

	(g)		Capital appreciation bond.

	(h)		Floating rate note obligations related to securities held — The Fund enters into transactions in which it transfers to Dealer Trusts (“Dealer Trusts”), fixed rate bonds in exchange for cash and residual interests in the Dealer Trusts’ assets and cash flows, which are in the form of inverse floating rate investments. The Dealer Trusts fund the purchases of the fixed rate bonds by issuing floating rate notes to third parties and allowing the Fund to retain residual interest in the bonds. The Fund enters into shortfall agreements with the Dealer Trusts which commit the Fund to pay the Dealer Trusts, in certain circumstances, the difference between the liquidation value of the fixed rate bonds held by the Dealer Trusts and the liquidation value of the floating rate notes held by third parties, as well as any shortfalls in interest cash flows. The residual interests held by the Fund (inverse floating rate investments) include the right of the Fund (1) to cause the holders of the floating rate notes to tender their notes at par at the next interest rate reset date, and (2) to transfer the municipal bond from the Dealer Trusts to the Fund, thereby collapsing the Dealer Trusts. The Fund accounts for the transfer of bonds to the Dealer Trusts as secured borrowings, with the securities transferred remaining in the Fund’s investment assets, and the related floating rate notes reflected as Fund liabilities. The notes issued by the Dealer Trusts have interest rates that reset weekly and the floating rate note holders have the option to tender their notes to the Dealer Trusts for redemption at par at each reset date. At January 31, 2009, Fund investments with a value of $99,581,148 are held by the Dealer Trusts and serve as collateral for the $63,194,000 in floating rate note obligations outstanding at that date.

	(i)		Securities have been designated as collateral in an amount equal to $134,452,898 in connection with open futures contracts and inverse floating rate municipal obligations.

	(j)		The aggregate cost for federal income tax purposes approximates the aggregate cost for book purposes.

Bond Insurance:


AGC		Assured Guaranty Corporation.

AMBAC		AMBAC Assurance Corporation.

FGIC		Financial Guaranty Insurance Company.

FSA		Financial Security Assurance Inc.

MBIA		Municipal Bond Investors Assurance Corporation.

XLCA		XL Capital Assurance Inc.

Futures Contracts Open at January 31, 2009:


						UNREALIZED
NUMBER OF		DESCRIPTION, DELIVERY	UNDERLYING FACE			APPRECIATION/
CONTRACTS	LONG/SHORT	MONTH AND YEAR	AMOUNT AT VALUE			(DEPRECIATION)

273	Long	U.S. Treasury Notes 10 Year March 2009	$	33,485,156		$	(377,047	)
20	Long	Swap Futures 5 Year March 2009		2,321,563			(7,386	)
63	Short	U.S. Treasury Notes 5 Year March 2009		(7,444,828	)		22,033
35	Short	U.S. Treasury Bond 2 Year March 2009		(7,616,875	)		20,707
127	Short	U.S. Treasury Notes 20 Year March 2009		(16,091,298	)		314,981
500	Short	Swap Futures 10 Year March 2009		(62,398,440	)		632,191

		Net Unrealized Appreciation				$	605,479

MS Quality Municipal Income Trust
Notes to the Portfolio of Investments
FAS 157
1/31/2009

The Fund adopted Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, Fair Value Measurements (“SFAS 157”), effective November 1, 2008. In accordance with SFAS 157, fair value is defined as the price that the Fund would receive to sell an investment or pay to transfer a liability in a timely transaction with an independent buyer in the principal market, or in the absence of a principal market the most advantageous market for the investment or liability. SFAS 157 establishes a three-tier hierarchy to distinguish between (1) inputs that reflect the assumptions market participants would use in pricing an asset or liability developed based on market data obtained from sources independent of the reporting entity (observable inputs) and (2) inputs that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing an asset or liability developed based on the best information available in the circumstances (unobservable inputs) and to establish classification of fair value measurements for disclosure purposes. Various inputs are used in determining the value of the Fund’s investments. The inputs are summarized in the three broad levels listed below.

	•		Level 1 — quoted prices in active markets for identical investments

	•		Level 2 — other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

	•		Level 3 — significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities and the determination of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to each security.

The following is a summary of the inputs used as of January 31, 2009 in valuing the Fund’s investments carried at value:


			Fair Value Measurements at January 31, 2009 Using
			Quoted Prices In		Significant		Significant
			Active Market for		Other Observable		Unobservable
			Identical Assets		Inputs		Inputs
	Total		(Level 1)		(Level 2)		(Level 3)
Investments in Securities	$	473,355,664	$	2,389,616	$	470,966,048		—
Other Financial Instruments*		605,479		605,479		—		—

Total	$	473,961,143	$	2,995,095	$	470,966,048		—


*		Other financial instruments include futures contracts.

Valuation of Investments — (1) portfolio securities are valued by an outside independent pricing service approved by the Trustees. The pricing service uses both a computerized grid matrix of tax-exempt securities and evaluations by its staff, in each case based on information concerning market transactions and quotations from dealers which reflect the mean between the last reported bid and asked price. The portfolio securities are thus valued by reference to a combination of transactions and quotations for the same or other securities believed to be comparable in quality, coupon, maturity, type of issue, call provisions, trading characteristics and other features deemed to be relevant. The Trustees believe that timely and reliable market quotations are generally not readily available for purposes of valuing tax-exempt securities and that the valuations supplied by the pricing service are more likely to approximate the fair value of such securities; (2) futures are valued at the

latest sale price on the commodities exchange on which they trade unless it is determined that such price does not reflect their market value, in which case they will be valued at their fair value as determined in good faith under procedures established by and under the supervision of the Trustees; (3) interest rate swaps are marked- to-market daily based upon quotations from market makers; (4) investments in open-end mutual funds, including the Morgan Stanley Institutional Liquidity Funds, are valued at the net asset value as of the close of each business day; and (5) short-term debt securities having a maturity date of more than sixty days at time of purchase are valued on a mark-to-market basis until sixty days prior to maturity and thereafter at amortized cost based on their value on the 61st day. Short-term debt securities having a maturity date of sixty days or less at the time of purchase are valued at amortized cost.

Item 2. Controls and Procedures.

(a) The Trust’s principal executive officer and principal financial officer have concluded that the Trust’s disclosure controls and procedures are sufficient to ensure that information required to be disclosed by the Trust’s in this Form N-Q was recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, based upon such officers’ evaluation of these controls and procedures as of a date within 90 days of the filing date of the report.

(b) There were no changes in the Trust’s internal control over financial reporting that occurred during the registrant’s fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Trust’s internal control over financial reporting.

Item 3. Exhibits.

(a) A separate certification for each principal executive officer and principal financial officer of the registrant are attached hereto.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Morgan Stanley Quality Municipal Income Trust

/s/ Randy Takian
Randy Takian
Principal Executive Officer
March 19, 2009

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

/s/ Randy Takian
Randy Takian
Principal Executive Officer
March 19, 2009

/s/ Francis Smith
Francis Smith
Principal Financial Officer
March 19, 2009