UNITED STATES

SECURITIES AND
EXCHANGE COMMISSION

Washington, D.C. 20549



FORM N-CSR

> CERTIFIED
>   SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number 811-01728



Nicholas Fund, Inc.

(Exact name of
registrant as specified in charter)



700 North Water
Street, Milwaukee, Wisconsin 53202

(Address of principal
executive offices)          (Zip
code)



Jeffrey T. May, Senior
Vice President, Secretary and Treasurer

700 North Water Street

Milwaukee,
Wisconsin 53202

(Name and address of
agent for service)



Registrant's telephone number,
including area code: 414-272-4650



Date of fiscal year end: 03/31/2008



Date of reporting period: 03/31/2008





Item 1. Report to Stockholders.

`ANNUAL REPORT

                                   March 31, 2008


                                NICHOLAS FUND, INC.

                               700 North Water Street
                             Milwaukee, Wisconsin 53202
                               www.nicholasfunds.com`

May 2008

Report to Fellow Shareholders:

For the first three months of calendar year 2008, Nicholas Fund returned
(8.83)% versus (9.45)% for the Standard & Poor's 500 Index. Since we last
reported as of September 30, 2007, the Fund declined 11.67%, for the six-month
period ending March 31, 2008, compared to a negative 12.46% for the S&P 500.
Other comparisons are shown below including the fiscal year ended March 31,
2008.

Returns for Nicholas Fund, Inc. and selected indices are provided in the
chart below for the period ended March 31, 2008.



|                                                            | Average Annual Total Return
|----------------------------------------------------------- | ---------------------------
|                                                            | 1 Year                     
|Nicholas Fund, Inc.                                         | (6.47)%                    
|Standard & Poor's 500 Index                                 | (5.08)%                    
|Consumer Price Index                                        | 4.00%                      
|Ending value of $10,000
    invested in Nicholas Fund, Inc. | $9,353                     
|Fund Expense Ratio (from
    07/31/07 Prospectus): 0.75%   



* The life of the Fund is 38.7 years from the date of its initial public
  offering, July 14, 1969. Starting time period for the Standard & Poor's 500
  Index and the Consumer Price Index was June 30, 1969.

The Fund's expense ratio for the period ended March 31, 2008 can be found in
the financial highlights included within this report.

Performance data quoted represents past performance and is no guarantee of
future results. The investment return and principal value of an investment will
fluctuate so that an investor's shares, when redeemed, may be worth more or less
than their original cost. Current performance of the Fund may be lower or higher
than the performance quoted. Performance data current to the most recent
month-end may be obtained by visiting www.nicholasfunds.com/returns.html.

The Fund's returns are reduced by expenses, while the market indices are not.
The ending values above illustrate the performance of a hypothetical $10,000
investment made in the Fund over the timeframes listed. Assumes reinvestment of
dividends and capital gains, but does not reflect the effect of any applicable
sales charge or redemption fees. Returns shown do not reflect the deduction of
taxes that a shareholder would pay on Fund distributions or the redemption of
Fund shares.

At March 31, 2008, Nicholas Fund was fully invested with 6.24% cash. The
diversified portfolio consisted of 57 equities. Management is tending to favor
smaller companies rather than larger ones as the 57 holdings compares with 49
from last year at the same time. The Fund's top five holdings were Berkshire
Hathaway, Affiliated Managers Group, O'Reilly Automotive, Thermo Fisher
Scientific and Walgreen Co. These stocks represent 21.29% of the total
portfolio. In terms of sectors, the Fund had 22.49% in financials, 16.66% in
consumer discretionary, 14.28% in industrials, 13.37% in health care and 9.61%
in energy. For the fiscal year ended March 31, 2008, energy stocks helped Fund
performance while financial and consumer staple stocks adversely affected
results.

Whether we are in recession or not, it certainly feels like one. The housing
slump, credit crunch and liquidity crisis have caused business and financial
despair. Near $4.00 per gallon for gas and rising food prices don't help. Our
forecast is for modest GDP growth in coming months. Continued Fed easing and
scheduled tax rebates should help both companies and consumers. Other possible
challenges over the intermediate-term are rising taxes, increasing inflation and
eroding corporate profit margins. Financial risk and financial anxiety remain
high.

Because of the economic situation, the stock market declined nearly 20% from
its October 2007 high to a March 2008 low. We feel this has created more
opportunity in the market, bearing in mind that patience will be needed to
realize capital gains. Very often, short-term fears, such as those today, can
create long-term possibilities. Navigating these treacherous waters will not be
easy.

Finally, we acknowledge again, that to our shareholders all that matters is
outstanding investment performance. We are totally committed to that goal.

Thank you for your continued interest in the Fund.

Sincerely,

/s/ Albert O. Nicholas

Co-Portfolio Manager





The Fund may invest in smaller companies, which involve additional risks such
as limited liquidity and greater volatility.

Please refer to the Schedule of Investments in the report for complete Fund
holdings information. Fund holdings and sector allocations are subject to change
and should not be considered a recommendation to buy or sell any security.

The S&P 500 Index is a broad based unmanaged index of 500 stocks, which is
widely recognized as representative of the equity market in general. The
Consumer Price Index represents changes in prices of all goods and services
purchased for consumption by urban households. One cannot invest directly in an
index.



Must be preceded or accompanied by a prospectus.



The Nicholas Funds are distributed by Quasar Distributors, LLC. (05/08)



COMPARISON OF CHANGE
IN VALUE OF $10,000 INVESTMENT IN

NICHOLAS FUND, INC.
AND S&P 500 INDEX

The line graph which follows compares the initial account value and
subsequent account value at the end of each of the most recently completed ten
fiscal years of the Fund, to the same investment over the same periods in the
S&P 500 Index. The graph assumes a $10,000 investment in the Fund and the index
at the beginning of the period.





|         | Nicholas Fund, Inc. | % Total Return | S&P 500 Index | % Total Return
|-------- | ------------------- | -------------- | ------------- | --------------
|03/31/98 | $10,000.00          |                | $10,000.00    |               
|03/31/99 | 10,013.00           | 0.13%          | 11,845.96     | 18.46%        
|03/31/00 | 10,688.88           | 6.75%          | 13,971.27     | 17.94%        
|03/31/01 | 8,899.56            | (16.74)%       | 10,942.79     | (21.68)%      
|03/31/02 | 8,877.31            | (0.25)%        | 10,969.05     | 0.24%         
|03/31/03 | 6,693.49            | (24.60)%       | 8,253.11      | (24.76)%      
|03/31/04 | 9,324.70            | 39.31%         | 11,150.29     | 35.10%        
|03/31/05 | 10,053.31           | 7.81%          | 11,896.69     | 6.69%         
|03/31/06 | 11,285.34           | 12.25%         | 13,290.99     | 11.72%        
|03/31/07 | 11,572.86           | 2.55%          | 14,863.85     | 11.83%        
|03/31/08 | 10,823.61           | (6.47)%        | 14,109.12     | (5.08)%       



The Fund's average annual total returns for the one-, five- and ten-year
periods ended on the last day of the most recent fiscal year are as follows:



|                            | One Year EndedMarch 31, 2008 | Five Years EndedMarch 31, 2008 | Ten Years Ended March 31, 2008
|--------------------------- | ---------------------------- | ------------------------------ | ------------------------------
|Average Annual Total Return | (6.47)%                      | 10.09%                         | 0.79%                         



Past performance is not predictive of future performance, and the above graph
and table do not reflect deduction of taxes that a shareholder would pay on Fund
distributions or the redemption of Fund shares.

`Financial Highlights (NICSX)
For a share outstanding throughout each period
-------------------------------------------------------------------------

                                         Year Ended March, 31,
                               ------------------------------------------
                                2008     2007     2006     2005     2004
                               ------   ------   ------   ------   ------
NET ASSET VALUE,
 BEGINNING OF PERIOD ........  $57.85   $61.49   $60.05   $56.14   $40.37
  INCOME (LOSS) FROM
  INVESTMENT OPERATIONS
   Net investment income ....     .21      .80      .26      .10      .09
   Net gain (loss) on
    securities (realized and
    unrealized) .............   (2.85)     .71     6.75     4.29    15.77
                               ------   ------   ------   ------   ------
      Total from investment
       operations ...........   (2.64)    1.51     7.01     4.39    15.86
                               ------   ------   ------   ------   ------
   LESS DISTRIBUTIONS
   From net investment
    income ..................    (.23)    (.82)    (.25)    (.07)    (.09)
   From net capital gain ....   (9.95)   (4.33)   (5.32)    (.41)      --
                               ------   ------   ------   ------   ------
      Total distributions ...  (10.18)   (5.15)   (5.57)    (.48)    (.09)
                               ------   ------   ------   ------   ------
NET ASSET VALUE, END
 OF PERIOD ..................  $45.03   $57.85   $61.49   $60.05   $56.14
                               ------   ------   ------   ------   ------
                               ------   ------   ------   ------   ------


TOTAL RETURN ................ (6.47)%    2.55%   12.25%    7.81%   39.31%


SUPPLEMENTAL DATA:
Net assets, end of
 period (millions) ..........$1,690.7 $2,213.5 $2,504.9 $2,434.5 $2,470.8
Ratio of expenses to
 average net assets .........    .75%     .75%     .77%     .75%     .73%
Ratio of net investment
 income to average
 net assets .................    .37%    1.30%     .41%     .17%     .17%
Portfolio turnover rate .....  31.18%   29.96%   32.48%   20.94%   18.18%



The accompanying notes to financial statements are an integral part of these
                                    highlights.


-------------------------------------------------------------------------------
Top Ten Equity Portfolio Holdings
March 31, 2008 (unaudited)
-------------------------------------------------------------------------------

                                                                 Percentage
        Name                                                    of Net Assets
        ----                                                    -------------
        Berkshire Hathaway Inc. - Class A .....................     6.31%
        Affiliated Managers Group, Inc. .......................     4.83%
        O'Reilly Automotive, Inc. .............................     3.46%
        Thermo Fisher Scientific Inc. .........................     3.30%
        Walgreen Co. ..........................................     3.27%
        DaVita, Inc. ..........................................     3.11%
        Yum! Brands, Inc. .....................................     3.08%
        Kinder Morgan Management, LLC .........................     3.05%
        General Dynamics Corporation ..........................     2.96%
        Cardinal Health, Inc. .................................     2.95%
                                                                   ------
        Total of top ten ......................................    36.32%
                                                                   ------
                                                                   ------


-------------------------------------------------------------------------------
Sector Diversification (As a Percentage of Portfolio)
March 31, 2008 (unaudited)
-------------------------------------------------------------------------------

        BAR CHART PLOT POINTS
        Financials ................................................    22.49%
        Consumer Discretionary ....................................    16.66%
        Industrials ...............................................    14.28%
        Health Care ...............................................    13.37%
        Energy ....................................................     9.61%
        Information Technology ....................................     6.24%
        Consumer Staples ..........................................     5.81%
        Short-Term Investments ....................................     5.74%
        Materials .................................................     5.48%
        Telecommunication Services ................................     0.32%



-------------------------------------------------------------------------------
Fund Expenses
For the six month period ended March 31, 2008 (unaudited)
-------------------------------------------------------------------------------
As a shareholder of the Fund, you incur two types of costs: (1) transaction
costs and (2) ongoing costs, including management fees and other operating
expenses.  The following table is intended to help you understand your ongoing
costs (in dollars) of investing in the Fund and to compare these costs with
those of other mutual funds.

The example is based on an investment of $1,000 made at the beginning of the
period and held for the entire period.

The first line of the table below provides information about the actual account
values and actual expenses.  You may use the information in this line, together
with the amount you invested, to estimate the expenses that you paid over the
period.  Simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.6), then multiply the result by the number
in the first line under the heading entitled "Expenses Paid During Period" to
estimate the expenses you paid on your account during this period.

The second line of the table below provides information about hypothetical
account values and hypothetical expenses based on the Fund's actual expense
ratio and an assumed rate of return of 5% per year before expenses, which is
not the Fund's actual return.  The hypothetical account values and expenses may
not be used to estimate the actual ending account balance or expenses you paid
for the period.  You may use this information to compare the ongoing costs of
investing in the Fund with other funds.  To do so, compare this 5% hypothetical
example with the 5% hypothetical examples that appear in the shareholder
reports of other funds.

Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as wire
fees.  Therefore, the second line of the table is useful in comparing ongoing
costs only, and will not help you determine the relative total costs of owning
different funds.  In addition, if these transactional costs were included, your
costs would have been higher.


                      Beginning          Ending             Expenses
                       Account          Account            Paid During
                        Value            Value               Period*
                       09/30/07         03/31/08       10/01/07 - 03/31/08
        ------------------------------------------------------------------
        Actual        $1,000.00         $  883.30              $3.58
        Hypothetical   1,000.00          1,021.20               3.84
         (5% return before expenses)

        * Expenses are equal to the Fund's six-month annualized expense ratio
        of 0.76%, multiplied by the average account value over the period,
        multiplied by 183 then divided by 366 to reflect the one-half year
        period.



Schedule of Investments
March 31, 2008
-------------------------------------------------------------------------------

 Shares or
 Principal
  Amount                                                             Value
-----------                                                     ---------------

COMMON STOCKS - 93.69%
             Consumer Discretionary - Auto &
              Components -- 0.60%
   300,000   Johnson Controls, Inc.                             $   10,140,000
                                                                --------------
             Consumer Discretionary - Consumer Durables &
              Apparel -- 3.59%
   650,000   Fortune Brands, Inc.                                   45,175,000
   929,056   Helen of Troy Limited *                                15,580,269
                                                                --------------
                                                                    60,755,269
                                                                --------------
             Consumer Discretionary - Consumer
              Services -- 0.57%
   201,300   IHOP Corp.                                              9,642,270
                                                                --------------
             Consumer Discretionary - Hotels, Restaurants
              & Leisure -- 4.12%
 1,254,037   California Pizza Kitchen, Inc. *                       16,440,425
   675,000   Six Flags, Inc. *                                       1,107,000
 1,400,000   Yum! Brands, Inc.                                      52,094,000
                                                                --------------
                                                                    69,641,425
                                                                --------------
             Consumer Discretionary - Retail -- 7.67%
   500,000   Best Buy Co., Inc.                                     20,730,000
   330,000   Jos. A. Bank Clothiers, Inc. *                          6,765,000
   700,000   Kohl's Corporation *                                   30,023,000
 2,050,000   O'Reilly Automotive, Inc. *                            58,466,000
   400,000   Penske Automotive Group, Inc.                           7,784,000
   864,100   Sally Beauty Company, Inc. *                            5,962,290
                                                                --------------
                                                                   129,730,290
                                                                --------------
             Consumer Staples - Food & Staple Retail -- 3.27%
 1,450,000   Walgreen Co.                                           55,230,500
                                                                --------------
             Consumer Staples - Food, Beverage &
              Tobacco -- 2.51%
 2,404,800   Constellation Brands, Inc. - Class A *                 42,492,816
                                                                --------------
             Energy -- 9.55%
   400,000   Apache Corporation                                     48,328,000
   631,300   Inergy, L.P.                                           17,619,583
   230,000   Kayne Anderson Energy Development Company               5,727,000
   700,000   Kayne Anderson Energy Total Return Fund, Inc.          17,759,000
   700,000   Kayne Anderson MLP Investment Company                  20,545,000
 1,011,123   Kinder Morgan Management, LLC *                        51,536,921
                                                                --------------
                                                                   161,515,504
                                                                --------------
             Financials - Banks -- 4.59%
   737,257   Bank Mutual Corporation                                 7,918,140
 2,054,126   Marshall & Ilsley Corporation                          47,655,723
 2,092,975   MGIC Investment Corporation                            22,039,027
                                                                --------------
                                                                    77,612,890
                                                                --------------
             Financials - Diversified -- 9.24%
   900,000   Affiliated Managers Group, Inc. *                      81,666,000
   800,000   American Express Company                               34,976,000
    50,000   Leucadia National Corporation                           2,261,000
 1,070,000   Moody's Corporation                                    37,268,100
                                                                --------------
                                                                   156,171,100
                                                                --------------
             Financials - Insurance -- 8.53%
       800   Berkshire Hathaway Inc. - Class A *                   106,720,000
   600,000   Loews Corporation                                      24,132,000
   330,000   Philadelphia Consolidated Holding Corp. *              10,626,000
   100,000   W.R. Berkley Corporation                                2,769,000
                                                                --------------
                                                                   144,247,000
                                                                --------------
             Health Care - Equipment -- 1.33%
   507,500   Covidien Ltd.                                          22,456,875
                                                                --------------
             Health Care - Pharmaceuticals &
              Biotechnology -- 4.97%
   550,000   Gilead Sciences, Inc. *                                28,341,500
   980,688   Thermo Fisher Scientific Inc. *                        55,742,306
                                                                --------------
                                                                    84,083,806
                                                                --------------
             Health Care - Services -- 6.98%
   951,087   Cardinal Health, Inc.                                  49,941,579
 1,100,000   DaVita, Inc. *                                         52,536,000
   570,000   VCA Antech, Inc. *                                     15,589,500
                                                                --------------
                                                                   118,067,079
                                                                --------------
             Industrials - Capital Goods -- 8.38%
   200,000   EMCOR Group, Inc. *                                     4,442,000
   600,000   General Dynamics Corporation                           50,022,000
    50,000   Lincoln Electric Holdings, Inc.                         3,224,500
 1,260,600   Oshkosh Truck Corporation                              45,734,568
   425,000   W.W. Grainger, Inc.                                    32,465,750
   215,000   Woodward Governor Company                               5,744,800
                                                                --------------
                                                                   141,633,618
                                                                --------------
             Industrials - Commercial Services &
              Supplies -- 4.77%
 1,150,000   Brady Corporation                                      38,444,500
   550,000   Copart, Inc. *                                         21,318,000
   200,000   Manpower Inc.                                          11,252,000
   200,000   United Stationers Inc. *                                9,540,000
                                                                --------------
                                                                    80,554,500
                                                                --------------
             Industrials - Transportation -- 1.06%
   700,000   Heartland Express, Inc.                                 9,982,000
   250,000   J.B. Hunt Transport Services, Inc.                      7,857,500
                                                                --------------
                                                                    17,839,500
                                                                --------------
             Information Technology - Hardware &
              Equipment -- 2.30%
 1,950,000   Dell Inc. *                                            38,844,000
                                                                --------------
             Information Technology - Software &
              Services -- 3.90%
   710,000   Fiserv, Inc. *                                         34,143,900
   800,000   Hewitt Associates, Inc. *                              31,816,000
                                                                --------------
                                                                    65,959,900
                                                                --------------
             Materials -- 5.45%
 1,000,000   Bemis Company, Inc.                                    25,430,000
 1,381,901   CEMEX, S.A.B. de C.V.                                  36,095,254
   800,200   Stepan Company +                                       30,591,646
                                                                --------------
                                                                    92,116,900
                                                                --------------
             Telecommunication - Services -- 0.31%
 2,500,000   Level 3 Communications, Inc. *                          5,300,000
                                                                --------------
                  TOTAL COMMON STOCKS
                   (cost $1,194,584,719) ......................  1,584,035,242
                                                                --------------

SHORT-TERM INVESTMENTS - 5.71%
             Commercial Paper - 5.47%
$5,000,000   Travelers Companies Inc. (The) 04/01/08, 3.09%          5,000,000
 5,425,000   Diageo Capital plc 04/02/08, 2.98%                      5,424,551
 3,750,000   H.J. Heinz Finance Company 04/03/08, 2.88%              3,749,400
 5,000,000   Integrys Energy Group, Inc. 04/03/08, 3.20%             4,999,111
 4,000,000   Wisconsin Energy Corporation 04/04/08, 3.40%            3,998,867
 4,000,000   ITT Corporation 04/07/08, 3.00%                         3,998,000
 3,075,000   Kraft Foods Inc. 04/08/08, 2.80%                        3,073,326
 3,850,000   Dow Chemical Company 04/09/08, 3.40%                    3,847,091
 1,050,000   H.J. Heinz Finance Company 04/10/08, 3.39%              1,049,110
 5,000,000   Wisconsin Energy Corporation 04/11/08, 2.75%            4,996,181
   375,000   Wisconsin Energy Corporation 04/11/08, 3.10%              374,677
 2,850,000   Alcoa Inc. 04/14/08, 3.10%                              2,846,810
 5,335,000   Diageo Capital plc 04/15/08, 2.90%                      5,328,983
 3,000,000   CVS Corporation 04/16/08, 3.25%                         2,995,938
 1,600,000   CVS Corporation 04/16/08, 3.30%                         1,597,800
 4,000,000   Home Depot Inc. 04/17/08, 2.90%                         3,994,844
 2,100,000   Fortune Brands, Inc. 04/18/08, 2.80%                    2,097,223
 5,000,000   Home Depot Inc. 04/21/08, 3.15%                         4,991,250
 6,025,000   Travelers Companies Inc. (The) 04/22/08, 2.80%          6,015,159
 5,675,000   ITT Corporation 04/23/08, 3.05%                         5,664,422
 1,000,000   Aetna Inc. 04/24/08, 3.00%                                998,083
 5,000,000   Wisconsin Energy Corporation 04/24/08, 2.85%            4,990,896
 3,000,000   Diageo Capital plc 04/25/08, 3.12%                      2,993,760
 2,825,000   H.J. Heinz Finance Company 04/29/08, 2.80%              2,818,848
 4,675,000   Diageo Capital plc 05/09/08, 2.40%                      4,663,157
                                                                --------------
                                                                    92,507,487
                                                                --------------
             Variable Rate Security - 0.24%
 3,963,746   Wisconsin Corporate Central Credit Union (1)
              04/01/08, 2.32%                                        3,963,746
                                                                --------------
                  TOTAL SHORT-TERM INVESTMENTS
                   (cost $96,471,233) .........................     96,471,233
                                                                --------------

                  TOTAL INVESTMENTS
                   (cost $1,291,055,982) -- 99.40% ............  1,680,506,475
                                                                --------------

             OTHER ASSETS, NET OF LIABILITIES -- 0.60% ........     10,169,961
                                                                --------------

                  TOTAL NET ASSETS
                   (basis of percentages
                   disclosed above) -- 100% ................... $1,690,676,436
                                                                --------------
                                                                --------------

+ This company is affiliated with the Fund as defined in Section 2(a)(3) of the
Investment Company Act of 1940, in that the Fund holds 5% or more of its
outstanding voting securities. (Note 5)
* Non-income producing security.
(1) Subject to a demand feature as defined by the Securities and Exchange
Commission.

The accompanying notes to financial statements are an integral part of this
                                   schedule.`

`Statement of Assets and Liabilities
March 31, 2008
-------------------------------------------------------------------------------

ASSETS
    Investments in securities at value -
         Nonaffiliated issuers (cost $1,266,823,318)-
          see accompanying schedule of investments ............ $1,649,914,829
         Affiliated issuers (cost $24,232,664) -
          see accompanying schedule of investments (Note 5) ...     30,591,646
                                                                --------------
              Total investments ...............................  1,680,506,475
                                                                --------------

    Receivables -
         Investment securities sold ...........................     15,619,484
         Dividend and interest ................................        336,397
                                                                --------------
              Total receivables ...............................     15,955,881
                                                                --------------
    Other .....................................................          9,868
                                                                --------------
              Total assets ....................................  1,696,472,224
                                                                --------------

LIABILITIES
    Payables -
         Investment securities purchased ......................      4,732,434
         Due to adviser -
              Management fee ..................................        874,035
              Accounting and administrative fee ...............         33,464
         Other payables and accrued expense ...................        155,855
                                                                --------------
              Total liabilities ...............................      5,795,788
                                                                --------------
              Total net assets ................................ $1,690,676,436
                                                                --------------
                                                                --------------

NET ASSETS CONSIST OF
    Paid in capital ........................................... $1,135,029,993
    Net unrealized appreciation on investments ................    389,450,493
    Accumulated undistributed
     net realized gain on investments .........................    165,351,368
    Accumulated undistributed net investment income ...........        844,582
                                                                --------------
              Total net assets ................................ $1,690,676,436
                                                                --------------
                                                                --------------


NET ASSET VALUE PER SHARE ($.50 par value,
 200,000,000 shares authorized),
 offering price and redemption price
 (37,541,983 shares outstanding) ..............................         $45.03
                                                                        ------
                                                                        ------



The accompanying notes to financial statements are an integral part of this
                                  statement.`

`Statement of Operations
For the year ended March 31, 2008
-------------------------------------------------------------------------------

INCOME
    Dividend (net of foreign taxes of $4,047) -
         Nonaffiliated issuers ................................  $  14,700,175
         Affiliated issuers (Note 5) ..........................        473,713
    Interest ..................................................      7,675,416
    Other .....................................................         21,222
                                                                 -------------
         Total income .........................................     22,870,526
                                                                 -------------

EXPENSES
    Management fee ............................................     13,278,972
    Transfer agent fees .......................................        966,284
    Accounting and administrative fees ........................        498,226
    Postage and mailing .......................................        185,464
    Custodian fees ............................................        101,320
    Insurance .................................................         87,930
    Printing ..................................................         69,894
    Registration fees .........................................         33,807
    Audit and tax fees ........................................         29,400
    Telephone .................................................         20,788
    Directors' fees ...........................................         17,500
    Accounting system and pricing service fees ................         10,620
    Legal fees ................................................         10,202
    Other operating expenses ..................................          3,529
                                                                 -------------
         Total expenses .......................................     15,313,936
                                                                 -------------
         Net investment income ................................      7,556,590
                                                                 -------------

NET REALIZED GAIN ON INVESTMENTS ..............................    390,895,188
                                                                 -------------

CHANGE IN NET UNREALIZED APPRECIATION/DEPRECIATION
 ON INVESTMENTS ...............................................   (503,554,850)
                                                                 -------------
    Net realized and unrealized loss on investments ...........   (112,659,662)
                                                                 -------------
    Net decrease in net assets resulting from operations ......  $(105,103,072)
                                                                 -------------
                                                                 -------------



The accompanying notes to financial statements are an integral part of this
                                  statement.`

`Statements of Changes in Net Assets
For the years ended March 31, 2008 and 2007
-------------------------------------------------------------------------------
                                                  2008               2007
                                             --------------     --------------
INCREASE (DECREASE) IN NET ASSETS
 FROM OPERATIONS
    Net investment income .................. $    7,556,950     $   30,535,686
    Net realized gain on investments .......    390,895,188        255,941,612
    Change in net unrealized
     appreciation/depreciation
     on investments ........................   (503,554,850)      (230,048,616)
                                             --------------     --------------
         Net increase (decrease) in
          net assets resulting from
          operations .......................   (105,103,072)        56,428,682
                                             --------------     --------------

DISTRIBUTIONS TO SHAREHOLDERS
    From net investment income .............     (8,143,242)       (31,175,873)
    From net realized gain on investments ..   (354,730,242)      (166,426,986)
                                             --------------     --------------
         Total distributions ...............   (362,873,484)      (197,602,859)
                                             --------------     --------------

CAPITAL SHARE TRANSACTIONS
    Proceeds from shares issued
     (261,295 and 388,782
     shares, respectively) .................     14,171,633         23,039,681
    Reinvestment of distributions
     (6,346,478 and 3,133,778
     shares, respectively) .................    334,717,745        181,936,479
    Cost of shares redeemed
     (7,327,761 and 5,994,558
     shares, respectively) .................   (403,767,276)      (355,161,454)
                                             --------------     --------------
         Decrease in net assets
          derived from capital share
          transactions .....................    (54,877,898)      (150,185,294)
                                             --------------     --------------
         Total decrease in net assets ......   (522,854,454)      (291,359,471)
                                             --------------     --------------

NET ASSETS
    Beginning of period ....................  2,213,530,890      2,504,890,361
                                             --------------     --------------
    End of period (including accumulated
     undistributed net investment income
     of $844,582 and $1,431,234,
     respectively) ......................... $1,690,676,436     $2,213,530,890
                                             --------------     --------------
                                             --------------     --------------



The accompanying notes to financial statements are an integral part of these
                                  statements.`

`Notes to Financial Statements
March 31, 2008
------------------------------------------------------------------------------
(1) Summary of Significant Accounting Policies --
    Nicholas Fund, Inc. (the "Fund") is organized as a Maryland corporation and
    is registered as an open-end, diversified management investment company
    under the Investment Company Act of 1940, as amended.  The primary
    objective of the Fund is long-term growth.  The following is a summary of
    the significant accounting policies of the Fund:

    (a)  Equity securities traded on a stock exchange will ordinarily be valued
         on the basis of the last sale price on the date of valuation on the
         securities principal exchange, or if in the absence of any sale on
         that day, the closing bid price.  For securities principally traded on
         the NASDAQ market, the Fund uses the NASDAQ Official Closing Price.
         Debt securities, excluding short-term investments, are valued at their
         current evaluated bid price as determined by an independent pricing
         service, which generates evaluations on the basis of dealer quotes for
         normal, institutional-sized trading units, issuer analysis, bond
         market activity and various other factors.  Securities for which
         market quotations may not be readily available are valued at their
         fair value as determined in good faith by procedures adopted by the
         Board of Directors.  Variable rate demand notes are valued at cost,
         which approximates market value.  U.S. Treasury Bills and commercial
         paper are stated at amortized cost, which approximates market value.
         Investment transactions for financial statement purposes are recorded
         on trade date.

    (b)  Net realized gain (loss) on portfolio securities was computed on the
         basis of specific identification.

    (c)  Dividend income is recorded on the ex-dividend date, and interest
         income is recognized on an accrual basis.  Non-cash dividends, if any,
         are recorded at value on date of distribution.  Generally, discounts
         and premiums on long-term debt security purchases, if any, are
         amortized over the expected lives of the respective securities using
         the effective yield method.

    (d)  Provision has not been made for federal income taxes or excise taxes
         since the Fund has elected to be taxed as a "regulated investment
         company" and intends to distribute substantially all net investment
         income and net realized capital gains on sales of investments to its
         shareholders and otherwise comply with the provisions of Subchapter M
         of the Internal Revenue Code applicable to regulated investment
         companies.

    (e)  Dividends and distributions paid to shareholders are recorded on the
         ex-dividend date.  Distributions from net investment income are
         generally declared and paid semiannually.  Distributions of net
         realized capital gain, if any, are declared and paid at least annually.

         The amount of distributions from net investment income and net
         realized capital gain are determined in accordance with federal income
         tax regulations, which may differ from U.S. generally accepted
         accounting principles.  To the extent these book and tax differences
         are permanent in nature, such amounts are reclassified among paid in
         capital, accumulated undistributed net realized gain (loss) on
         investments and accumulated undistributed net investment income.  At
         March 31, 2008, no reclassifications were recorded.

         The tax character of distributions paid during the years ended March
         31 were as follows:

                                               2008              2007
                                           ------------      ------------
              Distributions paid from:
              Ordinary income ............ $  8,143,242      $ 31,175,873
              Long-term capital gain .....  354,730,242       166,426,986
                                           ------------      ------------
              Total distributions paid ... $362,873,484      $197,602,859
                                           ------------      ------------
                                           ------------      ------------

         As of March 31, 2008, investment cost for federal tax purposes was
         $1,294,111,011 and the tax basis components of net assets were as
         follows:

              Unrealized appreciation ....................... $  520,431,806
              Unrealized depreciation .......................   (134,036,342)
                                                              --------------
              Net unrealized appreciation ...................    386,395,464
                                                              --------------
              Undistributed ordinary income .................     18,115,500
              Accumulated undistributed net realized
               capital gain .................................    151,826,034
              Paid in capital ...............................  1,135,029,993
              Other temporary differences ...................       (690,555)
                                                              --------------
              Net assets .................................... $1,690,676,436
                                                              --------------
                                                              --------------

         The differences between book-basis and tax-basis unrealized
         appreciation (depreciation), undistributed ordinary income and
         accumulated realized capital gain are attributable primarily to the
         tax deferral of losses from wash sales and holdings in partnership
         interests.

         As of March 31, 2008, the Fund has no capital loss carryforward.

         As of March 31, 2008, the Fund realized no post-October losses for tax
         purposes.

         As of March 31, 2008, the Fund had a tax deferral of wash loss sales
         of approximately $3,746,000.

         In July 2006, the Financial Accounting Standards Board ("FASB") issued
         Interpretation No. 48, "Accounting for Uncertainty in Income Taxes"
         ("FIN 48"). FIN 48 addresses the accounting for uncertainty in income
         taxes and establishes for all entities, including pass-through
         entities, such as the Fund, a minimum threshold for financial
         statement recognition of the benefit of positions taken in filing tax
         returns (including whether an entity is taxable in a particular
         jurisdiction).  The Fund recognizes tax benefits only if it is more
         likely than not that a tax position (including the Fund's assertion
         that its income is exempt from tax) will be sustained upon
         examination.  If applicable, the Fund recognizes interest accrued
         related to unrecognized tax benefits in "interest" and penalties in
         "other" expenses on the Statement of Operations.  The Fund adopted FIN
         48 on September 30, 2007.  The Fund had no material uncertain tax
         positions and has not recorded a liability for unrecognized tax
         benefits as of March 31, 2008.  Also, the Fund had recognized no
         interest and penalties related to uncertain tax benefits in 2008.  At
         March 31, 2008, the tax years March 31, 2005 through March 31, 2008
         remain open to examination in the Fund's major tax jurisdictions.

    (f)  The preparation of financial statements in conformity with U.S.
         generally accepted accounting principles requires management to make
         estimates and assumptions that affect the amounts reported in the
         financial statements and accompanying notes.  Actual results could
         differ from estimates.

(2) Related Parties--
    (a)  Investment Adviser and Management Agreement --
         The Fund has an agreement with Nicholas Company, Inc. (with whom
         certain officers and directors of the Fund are affiliated) (the
         "Adviser") to serve as investment adviser and manager.  Under the
         terms of the agreement, a monthly fee is paid to the Adviser based on
         an annualized fee of .75% of the average net asset value up to and
         including $50 million and .65% of the average net asset value in
         excess of $50 million.  Also, the Adviser may be paid for accounting
         and administrative services rendered by its personnel, subject to the
         following guidelines: (i) up to five basis points, on an annual basis,
         of the average net asset value of the Fund up to and including $2
         billion and up to three basis points, on an annual basis, of the
         average net asset value of the Fund greater than $2 billion, based on
         the average net asset value of the Fund as determined by valuations
         made at the close of each business day of each month, and (ii) where
         the preceding calculation results in an annual payment of less than
         $50,000, the Adviser, in its discretion, may charge the Fund up to
         $50,000 for such services.

    (b)  Legal Counsel --
         A director of the Adviser is affiliated with a law firm that provides
         services to the Fund.  The Fund incurred expenses of $5,702 for the
         year ended March 31, 2008 for legal services rendered by this law firm.

(3) Investment Transactions --
    For the year ended March 31, 2008 the cost of purchases and the proceeds
    from sales of investment securities, other than short-term obligations,
    aggregated $590,275,366 and $1,022,898,158, respectively.

(4) Future Adoption of New Accounting Standard --
    In September 2006, FASB issued Statement on Financial Accounting Standards
    No. 157, "Fair Value Measurements" ("FAS 157"). This standard clarifies the
    definition of fair value for financial reporting, establishes a framework
    for measuring fair value and requires additional disclosures about the use
    of fair value measurements.  FAS 157 is effective for financial statements
    issued for fiscal years beginning after November 15, 2007 and interim
    periods within those fiscal years.  As of March 31, 2008, the Fund does not
    believe the adoption of FAS 157 will impact the amounts reported in the
    financial statements, however, additional disclosures will be required
    about the inputs used to develop the measurements of fair value and the
    effect of certain of the measurements reported in the statement of
    operations for a fiscal period.

(5) Transactions with Affiliates -
    Following is a summary of fiscal 2008 transactions with "affiliated
    companies" as defined by the Investment Company Act of 1940:

                                                                                       Amount of
                                                                                       Dividends
                                                       Share Activity                  Credited
                                        --------------------------------------------   to Income
                                         Balance                           Balance     in Fiscal
           Security Name                 03/31/07   Purchases    Sales     03/31/08       2008
           -------------                ----------  ---------  ---------  ----------  -----------
           Stepan Company                355,300     444,900      --       800,200     $473,713
                                                                                       --------
                                                                                       --------



Report of Independent Registered Public Accounting Firm
-------------------------------------------------------------------------------

To the Shareholders and Board of Directors of Nicholas Fund, Inc.:

We have audited the accompanying statement of assets and liabilities of Nicholas Fund, Inc. (the "Fund"),
including the schedule of investments, as of March 31, 2008, and the related statement of operations for the
year then ended, the statements of changes in net assets for each of the two years in the period then ended,
and the financial highlights for each of the five years in the period then ended.  These financial statements
and financial highlights are the responsibility of the Fund's management.  Our responsibility is to express an
opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board
(United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements and financial highlights are free of material misstatement.  We were not
engaged to perform an audit of the Fund's internal control over financial reporting.  Our audits included
consideration of internal control over financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the
Fund's internal control over financial reporting.  Accordingly, we express no such opinion.  An audit also
includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial
statements and financial highlights, assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation.  Our procedures included confirmation
of securities owned as of March 31, 2008, by correspondence with the custodian and brokers or by other
appropriate auditing procedures where replies from brokers were not received.  We believe that our audits
provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all
material respects, the financial position of Nicholas Fund, Inc., as of March 31, 2008, the results of its
operations for the year then ended, the changes in its net assets for each of the two years in the period then
ended, and the financial highlights for each of the five years in the period then ended, in conformity with
U.S. generally accepted accounting principles.



ERNST & YOUNG LLP

Chicago, Illinois,
May 28, 2008`

`Historical Record
(unaudited)
--------------------------------------------------------------------------------------------------
                                     Net Investment                     Dollar        Growth of
                            Net          Income      Capital Gain      Weighted      an Initial
                        Asset Value   Distributions  Distributions  Price/Earnings     $10,000
                         Per Share      Per Share      Per Share       Ratio (2)    Investment (3)
                        -----------  --------------  -------------  --------------  --------------
July, 14 1969 (1) ......  $ 6.59        $  --          $   --             --           $ 10,000
March 31, 1985 .........   29.24         0.6420          1.5760          13.2 times      69,858
March 31, 1986 .........   35.26         0.5750          0.6100          15.8            87,699
March 31, 1987 .........   39.94         0.8820          0.1870          16.3           102,387
March 31, 1988 .........   32.15         1.8400          4.0340          14.1            98,557
March 31, 1989 .........   35.27         1.0250          0.4510          13.2           113,155
March 31, 1990 .........   37.72         0.9240          1.0540          14.9           127,360
March 31, 1991 .........   42.99         0.7900          0.2250          16.9           149,180
March 31, 1992 .........   49.68         0.6790          0.8240          19.4           178,011
March 31, 1993 .........   52.91         0.6790          2.0420          18.5           200,098
March 31, 1994 .........   51.10         0.8175          1.0470          16.7           200,182
March 31, 1995 .........   52.22         0.7070          3.3170          17.2           221,970
March 31, 1996 .........   63.81         0.5650          4.0945          21.0           293,836
March 31, 1997 .........   67.11         0.4179          5.3166          21.7           336,973
March 31, 1998 .........   93.98         0.3616          5.8002          30.0           508,762
March 31, 1999 .........   85.20         0.5880          8.2716          31.7           509,446
March 31, 2000 .........   84.56         0.3114          5.9433          37.3           543,813
March 31, 2001 .........   54.11         0.1900         19.2500          26.6           452,780
March 31, 2002 .........   53.74         0.2360            --            23.8           451,627
March 31, 2003 .........   40.37         0.1585            --            16.4           340,547
March 31, 2004 .........   56.14         0.0905            --            19.4           474,406
March 31, 2005 .........   60.05         0.0678          0.4100          19.4           511,476
March 31, 2006 .........   61.49         0.2512          5.3194          18.4           574,151
March 31, 2007 .........   57.85         0.8173          4.3310          16.6           588,783
March 31, 2008 .........   45.03         0.2283(a)       9.9501(b)       17.4           550,664

(1) Date of Initial Public Offering.
(2) Based on latest 12 months accomplished earnings.
(3) Assuming reinvestment of all distributions.


(a) Paid $0.0837 on June 7, 2007 to shareholders of record on June 6, 2007.
    Paid $0.1446 on December 26, 2007 to shareholders of record on December 24, 2007.

(b) Paid $3.5501 on June 7, 2007 to shareholders of record on June 6, 2007.
    Paid $6.4000 on December 26, 2007 to shareholders of record on December 24, 2007.


Range in quarter end price/earnings ratios since December 31, 1974
               High                     Low
       --------------------      -------------------
       March 31, 2000  37.3      March 31, 1982  8.3`

`Approval of Investment Advisory Contract
(unaudited)
-------------------------------------------------------------------------------
A discussion of the Approval by the Board of Directors of the Fund's Investment
Advisory Contract can be found in the Fund's Semiannual Report dated September
30, 2007.


Tax Information
March 31, 2008 (unaudited)
------------------------------------------------------------------------------
The Fund designates 100% of its ordinary income distribution for the year ended
March 31, 2008 as qualified dividend income under the Jobs and Growth Tax
Relief Reconciliation Act of 2003.

For the year ended March 31, 2008, 100% of the dividends paid from net ordinary
income qualify for the dividends received deduction available to corporate
shareholders.

The Fund hereby designates approximately $354,730,242 as a capital gain
dividend for the year ended March 31, 2008.


Information on Proxy Voting
(unaudited)
-------------------------------------------------------------------------------
A description of the policies and procedures that the Fund uses to determine
how to vote proxies relating to portfolio securities is available, without
charge, upon request by calling 800-544-6547 (toll-free) or 414-276-0535.  It
also appears in the Fund's Statement of Additional Information, which can be
found on the SEC's website, www.sec.gov.  A record of how the Fund voted its
proxies for the most recent twelve-month period ended June 30, also is
available on the Fund's website, www.nicholasfunds.com, and the SEC's website,
www.sec.gov.


Quarterly Portfolio Schedule
(unaudited)
------------------------------------------------------------------------------
The Fund files its complete schedule of investments with the SEC for the first
and third quarters of each fiscal year on Form N-Q.  The Fund's Form N-Q's are
available on the SEC's website at www.sec.gov and may be reviewed and copied at
the SEC's Public Reference Room in Washington, D.C.  Information on the
operation of the Public Reference Room may be obtained by calling 800-SEC-0330.


Directors and Officers of the Fund
(unaudited)
-----------------------------------------------------------------------------------------------------------------------

    The following table sets forth the pertinent information about the Fund's directors and officers as of March 31,
2008.  Unless otherwise listed, the business address of each director and officer is 700 North Water Street, Milwaukee,
WI 53202.

                                                                                             Number of
                                                  Term of                                  Portfolios in      Other
                                                 Office and                                Fund Complex   Directorships
                                Positions Held   Length of      Principal Occupations        Overseen         Held
   Name and Age                    With Fund    Time Served      During Past 5 Years        by Director    by Director
-----------------------------------------------------------------------------------------------------------------------

INTERESTED DIRECTOR
Albert O. Nicholas, 77 (1), (3)  President,     (2), 39 years  Chief Executive Officer,           3            None
                                 Portfolio                     President, Chairman of the
                                 Manager and                   Board, Nicholas Company, Inc.,
                                 Director                      the Adviser to the Fund.
                                                               He is Portfolio Manager of
                                                               Nicholas Equity Income Fund, Inc.
                                                               and the Fund.

DISINTERESTED DIRECTORS
Robert H. Bock, 76               Director       (2), 30 years  Private Investor, Consultant,      6            None
                                                               Dean Emeritus of Business
                                                               Strategy and Ethics, University of
                                                               Wisconsin School of Business,
                                                               1997 to present.

Jay H. Robertson, 56             Director       (2), 5 years   Private Investor, April 2000       7            None
                                                               to present.  Chairman of the
                                                               Board of Robertson-Ryan and
                                                               Associates, Inc., an insurance
                                                               brokerage firm from 1993 to
                                                               March 2000.

OFFICERS
David L. Johnson, 66 (3)         Executive       Annual,       Executive Vice President,
                                 Vice President  28 years      Nicholas Company, Inc., the
                                                               Adviser to the Fund.

Jeffrey T. May, 51               Senior Vice     Annual,       Senior Vice President, Treasurer
                                 President,      15 years      and Chief Compliance Officer, Nicholas
                                 Treasurer,                    Company, Inc., the Adviser to the
                                 Secretary and                 Fund.  He is Portfolio Manager
                                 Chief Compliance              of Nicholas Money Market Fund, Inc.
                                 Officer

David O. Nicholas, 46 (3)        Senior Vice     Annual,       Chief Investment Officer and
                                 President       19 years      Director, Nicholas Company, Inc.,
                                                               the Adviser to the Fund.
                                                               He is Portfolio Manager
                                                               of Nicholas II, Inc. and
                                                               Nicholas Limited Edition, Inc.
                                                               He formerly was Co-Portfolio Manager
                                                               of Nicholas High Income Fund, Inc.,
                                                               Nicholas Equity Income Fund, Inc.
                                                               and the Fund.

Lynn S. Nicholas, 51 (3)         Senior Vice     Annual,       Senior Vice President, Nicholas
                                 President       22 years      Company, Inc. the Adviser to the
                                                               Fund.

Lawrence J. Pavelec, 49          Senior Vice     Annual,       Senior Vice President, Nicholas
                                 President       3 years       Company, Inc., the Adviser to the
                                                               Fund.  He has been Portfolio
                                                               Manager of Nicholas High Income Fund,
                                                               Inc. since April 2008.  He served as
                                                               Co-Portfolio Manager from April 2003
                                                               until April 2008.  He was a portfolio
                                                               manager for Brandes Investment Partners
                                                               from 1999 to April 2003.

Mark J. Giese, 37                Vice President  Annual,       Vice President, Nicholas Company,
                                                 11 years      Inc., the Adviser to the Fund. He is
                                                               Portfolio Manager of Nicholas
                                                               Liberty Fund.

Candace L. Lesak, 50             Vice President  Annual,       Employee, Nicholas Company, Inc.,
                                                 22 years      the Adviser to the Fund.
____________________

(1)     Albert O. Nicholas is the only director of the Fund who is an "interested person" of the Fund,
        as that term is defined in the 1940 Act.  Mr. Nicholas is Chief Executive Officer, President and a Director of
        the Adviser and owns 97% of the outstanding voting securities of the Adviser.
(2)     Until duly elected or re-elected at a subsequent annual meeting of the Fund.
(3)     David O. Nicholas and Lynn S. Nicholas are the son and daughter, respectively, of Albert O.
        Nicholas.  David L. Johnson is a brother-in-law of Albert O. Nicholas.

    The Fund's Statement of Additional Information includes additional information about Fund
directors and is available, without charge, upon request, by calling 800-544-6547 (toll-free)
or 414-276-0535.

Privacy Policy
(unaudited)
-------------------------------------------------------------------------------
      Nicholas Fund, Inc. respects each shareholder's right to privacy.  We are
committed to safeguarding the information that you provide us to maintain and
execute transactions on your behalf.

      We collect the following non-public personal information about you:

      * Information we receive from you on applications or other forms, whether
we receive the form in writing or electronically.  This includes, but is not
limited to, your name, address, phone number, tax identification number, date
of birth, beneficiary information and investment selection.

      * Information about your transactions with us and account history with
us.  This includes, but is not limited to, your account number, balances and
cost basis information.  This also includes transaction requests made through
our transfer agent.

      * Other general information that we may obtain about you such as
demographic information.

              WE DO NOT SELL ANY NON-PUBLIC PERSONAL INFORMATION
                     ABOUT CURRENT OR FORMER SHAREHOLDERS.

                  INFORMATION SHARED WITH OUR TRANSFER AGENT,
                   A THIRD PARTY COMPANY, ALSO IS NOT SOLD.

      We may share, only as permitted by law, non-public personal information
about you with third party companies. Listed below are some examples of third
parties to whom we may disclose non-public personal information.  While these
examples do not cover every circumstance permitted by law, we hope they help
you understand how your information may be shared.

      We may share non-public personal information about you:

      * With companies who work for us to service your accounts or to process
transactions that you may request.  This would include, but is not limited to,
our transfer agent to process your transactions, mailing houses to send you
required reports and correspondence regarding the Fund and its Adviser, the
Nicholas Company, Inc., and our dividend disbursing agent to process fund
dividend checks.

      * With a party representing you, with your consent, such as your broker
or lawyer.

      * When required by law, such as in response to a subpoena or other legal
process.

      The Fund and its Adviser maintain policies and procedures to safeguard
your non-public personal information.  Access is restricted to employees who
the Adviser determines need the information in order to perform their job
duties.  To guard your non-public personal information we maintain physical,
electronic, and procedural safeguards that comply with federal standards.

      In the event that you hold shares of the Fund with a financial
intermediary, including, but not limited to, a broker-dealer, bank, or trust
company, the privacy policy of your financial intermediary would govern how
your non-public personal information would be shared with non-affiliated third
parties.`

`AUTOMATIC INVESTMENT PLAN - AN UPDATE
(unaudited)
-------------------------------------------------------------------------------
The Nicholas Family of Funds' Automatic Investment Plan provides a simple
method to dollar cost average into the fund(s) of your choice.

Dollar cost averaging involves making equal systematic investments over an
extended time period.  A fixed dollar investment will purchase more shares when
the market is low and fewer shares when the market is high.  The automatic
investment plan is an excellent way for you to become a disciplined investor.

The following table illustrates what dollar cost averaging can achieve.  Please
note that past performance is no guarantee of future results.  Nicholas Company
recommends dollar cost averaging as a practical investment method.  It should
be consistently applied for long periods so that investments are made through
several market cycles.  The table will be updated and appear in future
financial reports issued by the Fund.

                                                              Nicholas Fund
                                                           -------------------
      $1,000 initial investment on .......................  07/14/69* 03/31/98
      Number of years investing $100 each month following
       the date of initial investment ....................      38.7        10
      Total cash invested ................................   $47,500   $13,000
      Total dividend and capital gain distributions
       reinvested ........................................  $892,255    $6,388
      Total full shares owned at 03/31/08 ................    18,554       324
      Total market value at 03/31/08 .....................  $835,530   $14,626

The results above assume purchase on the last day of the month.  The Nicholas
Automatic Investment Plan actually invests on the 20th of each month (or on the
alternate date specified by the investor).  Total market value includes
reinvestment of all distributions.

*Date of Initial Public Offering.

Nicholas Funds Services Offered
(unaudited)
-------------------------------------------------------------------------------
*     IRAs
      * Traditional      * SIMPLE
      * Roth             * SEP

*     Coverdell Education Accounts

*     Profit Sharing Plan

*     Automatic Investment Plan

*     Direct Deposit of Dividend and Capital Gain Distributions

*     Systematic Withdrawal Plan with Direct Deposit

*     Monthly Automatic Exchange between Funds

*     Telephone Redemption

*     Telephone Exchange

*     24-hour Automated Account Information (800-544-6547)

*     24-hour Internet Account Access (www.nicholasfunds.com)

Please call a shareholder representative for further information on the above
services or with any other questions you may have regarding the Nicholas Funds
(800-544-6547).

                            Directors and Officers

                  ALBERT O. NICHOLAS, President and Director

                           ROBERT H. BOCK, Director

                          JAY H. ROBERTSON, Director

                  DAVID L. JOHNSON, Executive Vice President

                   DAVID O. NICHOLAS, Senior Vice President

                    LYNN S. NICHOLAS, Senior Vice President

               JEFFREY T. MAY, Senior Vice President, Secretary,
                    Treasurer and Chief Compliance Officer

                  LAWRENCE J. PAVELEC, Senior Vice President

                         MARK J. GIESE, Vice President

                       CANDACE L. LESAK, Vice President

                              Investment Adviser
                            NICHOLAS COMPANY, INC.
                             Milwaukee, Wisconsin
                             www.nicholasfunds.com
                         414-276-0535 or 800-544-6547

                                Transfer Agent
                        U.S. BANCORP FUND SERVICES, LLC
                             Milwaukee, Wisconsin
                         414-276-0535 or 800-544-6547

                                  Distributor
                           QUASAR DISTRIBUTORS, LLC
                             Milwaukee, Wisconsin

                                   Custodian
                                U.S. BANK N.A.
                             Milwaukee, Wisconsin

                 Independent Registered Public Accounting Firm
                               ERNST & YOUNG LLP
                               Chicago, Illinois

                                    Counsel
                         MICHAEL BEST & FRIEDRICH LLP
                             Milwaukee, Wisconsin


This report is submitted for the information of shareholders of the Fund.  It
is not authorized for distribution to prospective investors unless preceded or
accompanied by an effective prospectus.`





Item 2. Code of Ethics.

CODE OF ETHICS FOR
PRINCIPAL EXECUTIVE AND

SENIOR FINANCIAL
OFFICERS

I.    Covered Officers/Purpose of the Code



The Nicholas Family
of Funds code of ethics (this "Code") for the investment companies within the
complex (collectively, "Funds" and each, "Company") applies to the Company's
Principal Executive Officer and Principal Financial Officer (the "Covered
Officers" each of whom are set forth in Exhibit A) for the purpose of promoting:



> * honest and ethical conduct, including the ethical handling
>   of actual or apparent conflicts of interest between personal and professional
>   relationships;* full, fair, accurate, timely and understandable disclosure
>   in reports and documents that a registrant files with, or submits to, the
>   Securities and Exchange Commission ("SEC") and in other public communications
>   made by the Company;* compliance with applicable laws and governmental rules and
>   regulations;* the prompt internal reporting of violations of the Code to
>   an appropriate person or persons identified in the Code; and* accountability for adherence to the Code.



Each Covered Officer should adhere to a
high standard of business ethics and should be sensitive to situations that may
give rise to actual as well as apparent conflicts of interest.



II. Covered Officers Should Handle Ethically Actual
and Apparent Conflicts of Interest



Overview. A "conflict of interest"
occurs when a Covered Officer's private interest interferes with the interests
of, or his service to, the Company. For example, a conflict of interest would
arise if a Covered Officer, or a member of his family, receives improper
personal benefits as a result of his position with the Company.



Certain conflicts of interest arise out of
the relationships between Covered Officers and the Company and already are
subject to conflict of interest provisions in the Investment Company Act of 1940
("Investment Company Act") and the Investment Advisers Act of 1940 ("Investment
Advisers Act"). For example, Covered Officers may not individually engage in
certain transactions (such as the purchase or sale of securities or other
property) with the Company because of their status as "affiliated persons" of
the Company. The Company's and the investment adviser's compliance programs and
procedures are designed to prevent, or identify and correct, violations of these
provisions. This Code does not, and is not intended to, repeat or replace these
programs and procedures, and such conflicts fall outside of the parameters of
this Code.



Although typically not presenting an
opportunity for improper personal benefit, conflicts arise from, or as a result
of, the contractual relationship between the Company and the investment adviser
of which the Covered Officers are also officers or employees. As a result, this
Code recognizes that the Covered Officers will, in the normal course of their
duties (whether formally for the Company or for the adviser, or for both), be
involved in establishing policies and implementing decisions that will have
different effects on the adviser and the Company. The participation of the
Covered Officers in such activities is inherent in the contractual relationship
between the Company and the adviser and is consistent with the performance by
the Covered Officers of their duties as officers of the Company. Thus, if
performed in conformity with the provisions of the Investment Company Act and
the Investment Advisers Act, such activities will be deemed to have been handled
ethically. In addition, it is recognized by the Funds' Boards of Directors
("Boards") that the Covered Officers may also be officers or employees of one or
more other investment companies covered by this or other codes.





Other conflicts of interest are covered by
the Code, even if such conflicts of interest are not subject to provisions in
the Investment Company Act and the Investment Advisers Act. The following list
provides examples of conflicts of interest under the Code, but Covered Officers
should keep in mind that these examples are not exhaustive. The overarching
principle is that the personal interest of a Covered Officer should not be
placed improperly before the interest of the Company.



* * *



Each Covered Officer must:



> * not use his personal influence or personal relationships
>   improperly to influence investment decisions or financial reporting by the
>   Company whereby the Covered Officer would benefit personally to the detriment
>   of the Company;* not cause the Company to take action, or fail to take
>   action, for the individual personal benefit of the Covered Officer rather than
>   the benefit of the Company;* not use material non-public knowledge of portfolio
>   transactions made or contemplated for the Company to trade personally or cause
>   others to trade personally in contemplation of the market effect of such
>   transactions;* report, at least annually:* officer and director positions in corporations, public or
>     private, for profit or not for profit, or in which the Covered Officer or
>     any of his immediate family members holds 5% or more of its outstanding
>     stock;* Positions as a trustee, executor or other fiduciary;* Ownership interest in any broker-dealer or bank;* Transactions between the Covered Officer and any of the
>     Nicholas Family of Funds, the Nicholas Company or any company in which any
>     director of any of the Nicholas Family of Funds is an officer or director.* Situations in which any immediate family member of the
>     Covered Employee is an officer, director or employee of any company in which
>     any officer or director of the Nicholas Company or any of the Nicholas
>     Family of Funds is a director or executive officer.



There are some conflict of interest
situations that should always be discussed with the appropriate officer if
material. If the matter involves Jeffrey T. May, he should discuss the matter
with David O. Nicholas. If the matter involves any other person, that person
should discuss the matter with Jeffrey T. May. In each case, the officer with
whom such matter is discussed is encouraged to review the matter with counsel to
the Company. Examples of these include:



> * service as a director on the board of any public company;* the receipt of any non-nominal gifts;* the receipt of any entertainment from any company with
>   which the Company has current or prospective business dealings unless such
>   entertainment is business-related, reasonable in cost, appropriate as to time
>   and place, and not so frequent as to raise any question of impropriety;* any ownership interest in, or any consulting or employment
>   relationship with, any of the Company's service providers, other than its
>   investment adviser, principal underwriter, administrator or any affiliated
>   person thereof;* a direct or indirect financial interest in commissions,
>   transaction charges or spreads paid by the Company for effecting portfolio
>   transactions or for selling or redeeming shares other than an interest arising
>   from the Covered Officer's employment, such as compensation or equity
>   ownership.





III. Disclosure and Compliance



> * Each Covered Officer should familiarize himself with the
>   disclosure requirements generally applicable to the Company;* each Covered Officer should not knowingly misrepresent, or
>   cause others to misrepresent, facts about the Company to others, whether
>   within or outside the Company, including to the Company's directors and
>   auditors, and to governmental regulators and self-regulatory organizations;* each Covered Officer should, to the extent appropriate
>   within his area of responsibility, consult with other officers and employees
>   of the Funds and the adviser with the goal of promoting full, fair, accurate,
>   timely and understandable disclosure in the reports and documents the Funds
>   files with, or submits to, the SEC and in other public communications made by
>   the Funds; and* it is the responsibility of each Covered Officer to promote
>   compliance with the standards and restrictions imposed by applicable laws,
>   rules and regulations.



IV. Reporting and Accountability



Each Covered Officer must:



> * upon adoption of the Code (or thereafter as applicable,
>   upon becoming a Covered Officer), affirm in writing to the Board that he has
>   received, read, and understands the Code;* annually thereafter affirm to the Board that he has
>   complied with the requirements of the Code;* not retaliate against any other Covered Officer or any
>   employee of the Funds or their affiliated persons for reports of potential
>   violations that are made in good faith; and* notify the appropriate person promptly if he knows of any
>   violation of this Code. Failure to do so is itself a violation of this Code.
>   Each Covered Officer should notify Jeffrey T. May unless the person violating
>   the Code is Jeffrey T. May, in which case such person should notify David O.
>   Nicholas. In each case, each Covered Officer is encouraged to also contact
>   counsel to the Fund.



Jeffrey T. May is responsible for applying
this Code to specific situations in which questions are presented under it and
has the authority to interpret this Code in any particular situation; provided
that if the situation involves Jeffrey T. May directly, then Mr. David O.
Nicholas is responsible for applying the Code to him and he has authority to
interpret the Code with respect to such application. Both Jeffrey T. May and
David O. Nicholas are encouraged to discuss the matter with counsel to the Fund.
However, any approvals or waivers sought by the Principal Executive Officer will
be considered by the Independent Directors (the "Committee").



The Company will follow these procedures
in investigating and enforcing this Code:



> * Jeffrey T. May or David O. Nicholas, with the advice of
>   counsel will take all appropriate action to investigate any potential
>   violations reported to him;* if, after such investigation, the officer making such
>   investigation believes that no violation has occurred, he is not required to
>   take any further action;* any matter that the officer making the investigation
>   believes is a violation will be reported to the independent directors;* if the independent directors concur that a violation has
>   occurred, they will consider appropriate action, which may include review of,
>   and appropriate modifications to, applicable policies and procedures;
>   notification to appropriate personnel of the investment adviser or its board;
>   or a recommendation to dismiss the Covered Officer;* the independent directors will be responsible for granting
>   waivers, as appropriate; and* any changes to or waivers of this Code will, to the extent
>   required, be disclosed as provided by SEC rules.





V. Other Policies and Procedures



This Code shall be the sole code of ethics
adopted by the Funds for purposes of Section 406 of the Sarbanes-Oxley Act and
the rules and forms applicable to registered investment companies thereunder.
Insofar as other policies or procedures of the Funds, the Funds' adviser,
principal underwriter, or other service providers govern or purport to govern
the behavior or activities of the Covered Officers who are subject to this Code,
they are superseded by this Code to the extent that they overlap or conflict
with the provisions of this Code. The Funds' and their investment adviser's
codes of ethics under Rule 17j-1 under the Investment Company Act and the
adviser's more detailed policies and procedures are separate requirements
applying to the Covered Officers and others, and are not part of this Code.



VI. Amendments



Any amendments to this Code, other than
amendments to Exhibit A, must be approved or ratified by a majority vote of the
Board, including a majority of independent directors.



VII. Confidentiality



All reports and records prepared or
maintained pursuant to this Code will be considered confidential and shall be
maintained and protected accordingly. Except as otherwise required by law or
this Code, such matters shall not be disclosed to anyone other than the
appropriate Board and its counsel, the appropriate Company and the Nicholas
Company.



VIII. Internal Use



The Code is intended solely for the
internal use by the Funds and does not constitute an admission, by or on behalf
of any Company, as to any fact, circumstance, or legal conclusion.





Date: November 20, 2003

Affirmed: November 26, 2007



Exhibit A



Persons Covered by this Code of Ethics



The Nicholas
      Company
      Albert O.
      Nicholas
      Jeffrey T. MayNicholas Fund,
      Inc.
      Albert O.
      Nicholas
      Jeffrey T. MayNicholas II,
      Inc.
      David O.
      Nicholas
      Jeffrey T. MayNicholas
      Limited Edition, Inc.
      David O.
      Nicholas
      Jeffrey T. MayNicholas Income
      Fund, Inc.
      David O.
      Nicholas
      Jeffrey T. MayNicholas Equity
      Income Fund, Inc.
      Albert O.
      Nicholas
      Jeffrey T. MayNicholas
      Liberty Fund
      David O.
      Nicholas
      Jeffrey T. MayNicholas Money
      Market Fund, Inc.
      Albert O.
      Nicholas
      Jeffrey T. May








Item 3. Audit Committee Financial
Expert.

The Fund's Board of Directors has
determined that no member of the Board of Directors is an audit committee
financial expert as that term is defined for purposes of this item. The Fund's
Board of Directors routinely holds its meetings with the other six funds in the
Nicholas complex, there is substantial overlap in the boards of each of those
funds, auditors for funds in the Nicholas complex make presentations jointly to
the boards of the funds which they audit and three of those funds have the same
auditor as the Fund. The boards of directors of five of those other funds have
determined that one of their members meets the definition of an audit committee
financial expert; however, that person is not a director of the Fund. The Fund
believes that the joint meetings and presentations with the other funds in the
Nicholas complex and the availability and presence of the board member of other
funds in the Nicholas complex who is an audit committee financial expert gives
the Fund some of the benefit of having a board member who meets the definition
of an audit committee financial expert. The Fund can call upon this person from
time to time should circumstances warrant. The independent members of the Fund's
Board of Directors are considering the possibility of adding that person as an
independent director of the Fund and adding other independent directors;
however, under present SEC rules, such additions may require that the Fund hold
a meeting of the shareholders. Current SEC proposals, if adopted, may change the
required percentage of independent directors for mutual funds. The Board of
Directors of the Fund believes that it is not in the best interest of the Fund
to hold a shareholder meeting until after such SEC proposals are finalized, at
which time the Board can more easily evaluate the resulting requirements, the
methods which will then be available to satisfy those requirements and the
benefit to the Fund of holding a shareholder meeting.





Item 4. Principal Accountant Fees
and Services.

(a) Audit Fees. The aggregate
fees billed for each of the last two fiscal years (the "Reporting Periods") for
professional services rendered by the Fund's principal accountant (the
"Auditor") for the audit of the Fund's annual financial statements, or services
that are normally provided by the Auditor in connection with the statutory and
regulatory filings or engagements for the Reporting Periods, were $24,150 in
2008 and $23,000 in 2007.

(b) Audit-Related Fees. There were no fees billed in each of the last
two fiscal years for assurance and related services rendered by the Auditor to
the Fund that are reasonably related to the performance of the audit of the
Fund's financial statements and are not reported under paragraph (a) of this
Item 4.

(c) Tax Fees. The aggregate fees billed in the Reporting Periods for
professional services rendered by the Auditor for tax compliance, tax advice and
tax planning ("Tax Services") were $5,250 in 2008 and $5,000 in 2007. These
services consisted of (i) review or preparation of U.S. federal, state, local
and excise tax returns; (ii) U.S. federal, state and local tax planning, advice
and assistance regarding statutory, regulatory or administrative developments,
(iii) tax advice regarding tax qualification matters and/or treatment of various
financial instruments held or proposed to be acquired or held.

There were no fees billed in each of the last two fiscal years for Tax
Services by the Auditor to the Fund's investment adviser which required
pre-approval by the Board of Directors as described in paragraph (e)(1) of this
Item 4.

(d) All Other Fees. The aggregate fees billed for professional
services rendered by the Auditor to the Fund's investment adviser were $15,750
in 2007 and $15,000 in 2006.  These services were for the audit of the
investment adviser for the adviser's fiscal years ended 10/31/2007 and
10/31/2006.

There were no fees billed in each of the last two fiscal years for Non-Audit
Services by the Auditor to the Fund's investment adviser which required
pre-approval by the Board of Directors as described in paragraph (e)(1) of this
Item 4.

(e) Audit Committee Pre-Approval Policies and Procedures. The Fund's
Board of Director's has not adopted any pre-approval policies and procedures as
described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.  The Fund's
Board of Directors meets with the Auditors and management to review and
pre-approve the Auditor's engagements for audit and non-audit services to the
Fund and its Adviser prior to each engagement.

(f)  No disclosures are required by this Item 4(f).

(g) There were no non-audit fees billed in each of the last two fiscal years
by the Auditor for services rendered to the Fund or the Fund's investment
adviser that provides ongoing services.

(h)  No disclosures are required by this Item 4(h).



Item 5. Audit Committee of Listed
Registrants.

Not applicable to this filing.



Item 6. Schedule of Investments.

The schedule of investments in
securities of unaffiliated issuers is included as part of the report to
shareholders filed under Item 1.



Item 7. Disclosure of Proxy Voting
Policies and Procedures for Closed-End Management Investment Companies.

Applicable only to annual reports
filed by closed-end funds.



Item 8. Portfolio Managers of Closed-End Management Investment Companies.

Applicable only to annual reports
filed by closed-end funds.



Item 9. Purchases of Equity
Securities by Closed-End Management Investment Companies and Affiliated
Purchasers.

Applicable only to closed-end funds.



Item 10.  Submission of
Matters to a Vote of Security Holders.

Not applicable to this filing.



Item 11. Controls and Procedures.

The Fund's principal executive
officer and principal financial officer have concluded that the Fund's
disclosure controls and procedures are sufficient to ensure that information
required to be disclosed by the Fund in this Form N-CSR 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. There were no significant changes or corrective actions with regard
to significant deficiencies or material weaknesses in the Fund's internal
controls or in other factors that could significantly affect the Fund's internal
controls subsequent to the date of their evaluation.



Item 12. Exhibits.

(a)(1) Code of Ethics -- Any code of
ethics, or amendments thereto, that is the subject of the disclosure required by
Item 2, to the extent that the registrant intends to satisfy the Item 2
requirements through filing of an exhibit.
Not applicable to this filing.



(a)(2) Certifications of Principal
Executive Officer and Principal Financial Officer pursuant to Section 302 of the
Sarbannes-Oxley Act of 2002, attached hereto as part of
EX-99.CERT.



(a)(3)  Any written solicitation
to purchase securities under Rule 23c-1 under the Act sent or given during the
period covered by the report by or on behalf of the registrant to 10 or more
person.



Applicable only to closed-end funds.



(b) Certifications of Principal
Executive Officer and Principal Financial Officer pursuant to Section 906 of the
Sarbannes-Oxley Act of 2002, attached hereto as part of
EX-99.906CERT.





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.



(Registrant) Nicholas Fund, Inc.



By: /s/ Albert O. Nicholas

Name: Albert O. Nicholas

Title: Principal Executive Officer



Date: 05/30/2008



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.



By: /s/ Albert O. Nicholas

Name: Albert O. Nicholas

Title: Principal Executive Officer

Date: 05/30/2008



By: /s/ Jeffrey T. May

Name: Jeffrey T. May

Title: Principal Financial Officer

Date: 05/30/2008