<TABLE> <S> <C>

<ARTICLE> 6
<LEGEND>
This schedule contains summary financial information extracted from Allied
Capital Corporation and subsidiaries' consolidated balance sheet and
consolidated statements of operations, changes in net assets and cash flows and
is qualified in its entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1,000
       
<S>                             <C>
<PERIOD-TYPE>                   9-MOS
<FISCAL-YEAR-END>                          DEC-31-1996
<PERIOD-START>                             JAN-01-1996
<PERIOD-END>                               SEP-30-1996
<INVESTMENTS-AT-COST>                          122,153
<INVESTMENTS-AT-VALUE>                         128,020
<RECEIVABLES>                                        0
<ASSETS-OTHER>                                  33,524
<OTHER-ITEMS-ASSETS>                                 0
<TOTAL-ASSETS>                                 161,544
<PAYABLE-FOR-SECURITIES>                             0
<SENIOR-LONG-TERM-DEBT>                         86,300
<OTHER-ITEMS-LIABILITIES>                        3,042
<TOTAL-LIABILITIES>                             89,342
<SENIOR-EQUITY>                                  7,026
<PAID-IN-CAPITAL-COMMON>                        51,103
<SHARES-COMMON-STOCK>                            7,026
<SHARES-COMMON-PRIOR>                            6,198
<ACCUMULATED-NII-CURRENT>                        1,941
<OVERDISTRIBUTION-NII>                               0
<ACCUMULATED-NET-GAINS>                              0
<OVERDISTRIBUTION-GAINS>                             0
<ACCUM-APPREC-OR-DEPREC>                         5,867
<NET-ASSETS>                                    71,202
<DIVIDEND-INCOME>                                1,144
<INTEREST-INCOME>                               10,240
<OTHER-INCOME>                                     108
<EXPENSES-NET>                                   8,385
<NET-INVESTMENT-INCOME>                          3,107
<REALIZED-GAINS-CURRENT>                         8,376
<APPREC-INCREASE-CURRENT>                      (1,702)
<NET-CHANGE-FROM-OPS>                            9,781
<EQUALIZATION>                                       0
<DISTRIBUTIONS-OF-INCOME>                        5,866
<DISTRIBUTIONS-OF-GAINS>                             0
<DISTRIBUTIONS-OTHER>                                0
<NUMBER-OF-SHARES-SOLD>                            751
<NUMBER-OF-SHARES-REDEEMED>                          0
<SHARES-REINVESTED>                                 77
<NET-CHANGE-IN-ASSETS>                          14,021
<ACCUMULATED-NII-PRIOR>                              0
<ACCUMULATED-GAINS-PRIOR>                      (3,676)
<OVERDISTRIB-NII-PRIOR>                              0
<OVERDIST-NET-GAINS-PRIOR>                           0
<GROSS-ADVISORY-FEES>                            2,192
<INTEREST-EXPENSE>                               5,607
<GROSS-EXPENSE>                                  8,385
<AVERAGE-NET-ASSETS>                            64,191
<PER-SHARE-NAV-BEGIN>                             8.26
<PER-SHARE-NII>                                   0.45
<PER-SHARE-GAIN-APPREC>                           0.98
<PER-SHARE-DIVIDEND>                              0.83
<PER-SHARE-DISTRIBUTIONS>                            0
<RETURNS-OF-CAPITAL>                                 0
<PER-SHARE-NAV-END>                               9.28
<EXPENSE-RATIO>                                   0.13
<AVG-DEBT-OUTSTANDING>                          83,800
<AVG-DEBT-PER-SHARE>                             12.25
        

</TABLE>