<PAGE> 1
		   SECURITIES AND EXCHANGE COMMISSION
			Washington, D.C. 20549
			 ____________________

x            ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF
		     THE SECURITIES EXCHANGE ACT OF 1934

	       For the fiscal year ended December 31, 1996

				   OR

"	          TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF
		    THE SECURITIES EXCHANGE ACT OF 1934

		     For the transition period from     to
			Commission File Number 33-14843

				_________________

	  RURAL ELECTRIC COOPERATIVE GRANTOR TRUST (DESERET) 1988-D1
	     (Exact name of registrant as specified in its charter)

				   NEW YORK
	(State or other jurisdiction of incorporation or organization)

				  36-6878767
		 (I.R.S. Employer Identification Number)

	       2201 Cooperative Way, Herndon, VA 20171-3025
		 (Address of principal executive offices)
    (Registrant's telephone number, including area code, is 703-709-6700)

			      ___________________

      Securities Registered pursuant to Section 12(b) of the Act:  None.

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.

			       Yes   X      No


The Registrant has no common or voting stock.

<PAGE> 2
		  DOCUMENTS INCORPORATED BY REFERENCE:

1.      Form of Trust Agreement
2.      Loan Agreement
3.      Loan Guarantee and Servicing Agreement

Exhibit Index located on page 13.

<PAGE> 3

Part I


Item 3.  Legal Proceedings

	    None.


Item 4.  Submission of Matters to a Vote of Security Holders

	   None.

<PAGE> 4

Part II

Item 5.  Market for the Registrant's Common Equity and Related
	 Stockholder Matters

     a)     There is no established trading market for the certificates
	    representing ownership of the beneficial interest in the Trust.

     b)     As of March 28, 1997 there was one holder of certificates
	    representing ownership of the beneficial interest in the Trust.


Item 8.  Financial Statements and Supplementary Data

	    See attached audited financial statements.


Item 9.  Disagreements on Accounting and Financial Disclosure

	    None.



Part III

Item 13.    Certain Relationships and Related Transactions

	    None.
<PAGE> 5

Part IV

Item 14.    Exhibits, Financial Statement Schedules and Reports
	    on Form 8-K

      a)    The following documents are filed as part of this report:

	    1.      Financial Statements
		    Report of Independent Public Accountants
		    Statement of Assets and Liabilities as of
			December 31, 1996 and 1995
		    Statement of Income and Expenses, for the Years Ended
			December 31, 1996, 1995 and 1994
		    Statement of Cash Flows, for the Years Ended
			December 31, 1996, 1995 and 1994
		    Notes to Financial Statements

	    2.      Financial Statement Schedules are omitted because they
		    are inapplicable.

	    3.      Exhibits

<TABLE>
		    <S>              <C>
		    Exhibit
		    Number           Description of Exhibit

		     4.1             Form of Trust Agreement, including the form of Rural Electric Cooperative
				     Grantor Trust Certificate (incorporated by reference to Exhibit 4.1 to
				     Registration Statement on Form S-1 [No. 33-14843]).

		    10.1             Loan Agreement (incorporated by reference to Exhibit 10.1 to Registration
				     Statement on Form S-1 [No. 33-14843]).

		    10.2             Loan Guarantee and Servicing Agreement (incorporated by reference to Exhibit
				     10.2 to Registration Statement on Form S-1 [No. 33-14843]).
</TABLE>

      b)    Form 8-K dated December 17, 1996.
	    Semi-annual Report to Certificateholders dated December 15, 1996.

<PAGE> 6

Supplemental information to be furnished with reports filed pursuant to
Section 15(d) of the Act by Registrants which have not registered securities
pursuant to Section 12 of the Act.

      No annual report, proxy statement, form of proxy or other proxy
      soliciting material has been sent to Certificateholders, and the
      Registrant does not presently contemplate sending any such material
      subsequent to the filing of this report.

<PAGE> 7


Pursuant to the requirements of Section 13 or 15(d) of the Securities Act
of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized, in the County of
Fairfax, Commonwealth of Virginia on the 28th day of March, 1997.


	RURAL ELECTRIC COOPERATIVE GRANTOR TRUST (DESERET) 1988 D-1

	    By:  NATIONAL RURAL UTILITIES COOPERATIVE
		 FINANCE CORPORATION as Servicer

		 By: /s/ Sheldon C. Petersen
		     Sheldon C. Petersen, Governor and
			Chief Executive Officer






<PAGE> 8

		   RURAL ELECTRIC COOPERATIVE GRANTOR
			TRUST (DESERET) 1988-D1


	   FINANCIAL STATEMENTS AS OF DECEMBER 31, 1996 AND 1995,
	  AND FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
		     TOGETHER WITH AUDITORS' REPORT
























<PAGE> 9




		Report of Independent Public Accountants



To the Trustee of
Rural Electric Cooperative Grantor Trust
	(Deseret) 1988-D1, and

To the Board of Directors of
National Rural Utilities Cooperative
	Finance Corporation:


We have audited the accompanying statements of assets and liabilities of
Rural Electric Cooperative Grantor Trust (Deseret) 1988-D1 as of December 31,
1996 and 1995, and the related statements of income and expenses and cash
flows for each of the three years in the period ended December 31, 1996.
These financial statements are the responsibility of the Trust's management.
Our responsibility is to express an opinion on these financial statements
based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform an audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement.  An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation.  We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Rural Electric Cooperative
Grantor Trust (Deseret) 1988-D1 as of December 31, 1996 and 1995, and the
results of its operations and its cash flows for the years ended December 31,
1996, 1995 and 1994, in conformity with generally accepted accounting
principles.




March 24, 1997
Washington, D. C.

<PAGE> 10
<TABLE>
<CAPTION>
       RURAL ELECTRIC COOPERATIVE GRANTOR TRUST (DESERET) 1988-D1

		  STATEMENTS OF ASSETS AND LIABILITIES

		     AS OF DECEMBER 31, 1996 AND 1995

    _____________________________________________________________________



				  1996                     1995
<S>                          <C>                      <C>

ASSETS

Interest Receivable             $143,156                 $143,156

Note Receivable               19,200,000               19,200,000

     Total Assets            $19,343,156              $19,343,156





LIABILITIES

Interest Payable-
Grantor Trust Certificates      $139,392                 $139,392

Servicer Fees Payable              3,764                    3,764

Rural Electric Cooperative
  Grantor Trust Certificates  19,200,000               19,200,000

     Total Liabilities       $19,343,156              $19,343,156










</TABLE>

	      The accompanying notes are an integral part
		      of these financial statements



<PAGE> 11
<TABLE>
<CAPTION>
	RURAL ELECTRIC COOPERATIVE GRANTOR TRUST (DESERET) 1988-D1

		   STATEMENTS OF INCOME AND EXPENSES

	   FOR THE YEARS ENDED DECEMBER 31, 1996, 1995, AND 1994

    _____________________________________________________________________



				 1996          1995         1994
<S>                           <C>           <C>           <C>
INCOME:
  Interest on note receivable $1,908,749    $1,908,749    $1,908,749


EXPENSES:
  Interest on
  grantor trust certificates   1,858,560     1,858,560     1,858,560
  Servicer fees                   50,189        50,189        50,189

      Total Expenses           1,908,749     1,908,749     1,908,749

      Net Income              $       --    $       --    $       --


</TABLE>


















	       The accompanying notes are an integral part
		     of these financial statements


<PAGE> 12
<TABLE>
<CAPTION>

	 RURAL ELECTRIC COOPERATIVE GRANTOR TRUST (DESERET) 1988-D1

			   STATEMENTS OF CASH FLOWS

	    FOR THE YEARS ENDED DECEMBER 31, 1996, 1995, AND 1994

   _____________________________________________________________________

					     1996          1995          1994
<S>                                     <C>            <C>            <C>
CASH FLOWS FROM
  OPERATING ACTIVITIES:
  Interest received on note receivable   $1,908,749     $1,908,749     $1,908,749
  Interest paid to Certificateholders   ( 1,858,560)   ( 1,858,560)   ( 1,858,560)
  Fees paid to Servicer                 (    50,189)   (    50,189)   (    50,189)

     Net cash provided by
       operating activities                      --             --             --


CASH FLOWS FROM INVESTING ACTIVITIES:
  Proceeds from principal payment on note        --             --             --

    Net cash provided from
     investing activities                        --             --             --


CASH FLOWS FROM FINANCING ACTIVITES:
  Principal payment to Certificateholders        --             --             --

    Net cash used in financing activities        --             --             --

NET CHANGE IN CASH                               --             --             --

CASH, beginning of year                          --             --             --

CASH, end of year                        $       --     $       --     $       --

ACCRUAL TO CASH BASIS RECONCILIATION:
  Accrual basis income                   $       --     $       --     $       --
  Change in accrual accounts:
   Decrease in interest receivable               --             --             --
   Decrease in interest payable                  --             --             --
   Decrease in servicer fees payable             --             --             --

     Total change in accrual accounts            --             --             --

Net cash provided by
  operating activities                   $       --     $       --     $       --



</TABLE>

		 The accompanying notes are an integral part
			  of these financial statements


<PAGE> 13


	RURAL ELECTRIC COOPERATIVE GRANTOR TRUST (DESERET) 1988-D1

		      NOTES TO FINANCIAL STATEMENTS

		     AS OF DECEMBER 31, 1996, 1995 AND 1994


1.  ORGANIZATION AND OPERATIONS

    Rural Electric Cooperative Grantor Trust (Deseret) 1988-D1 (the "Trust")
    was formed under a Trust Agreement dated February 15, 1988 among National
    Rural Utilities Cooperative Finance Corporation ("CFC"), Deseret Generation
    & Transmission Co-operative, Inc. (the "Cooperative") and The First
    National Bank of Chicago (the "Trustee"). On that date, CFC made a loan to
    the Cooperative which issued a note (the "Note"), evidencing the borrowing
    to the Trust.  The Trust issued to CFC Rural Electric Cooperative Grantor
    Trust (Deseret) 9.68% Certificates Due 2002 (the "Certificates") in the
    amount of $19,200,000.  The Certificates are solely the obligations of
    the Trust and are not insured or guaranteed by CFC, the Cooperative,
    the Trustee, the Rural Utilities Service ("RUS") of the United States
    Department of Agriculture ("USDA") nor any other governmental agency.
    Each Certificate represents an undivided fractional interest in the Trust.
    CFC is the depositor of the Trust and acts as Servicer of the Note.
    CFC filed, on behalf of the Trust, a Registration Statement on Form S-1
    (Registration No. 33-14843) which became effective on May 4, 1988, and CFC
    resold the Certificates thereunder.

    The assets of the Trust consist primarily of the Note, bearing interest
    at 9.94% and maturing 2002,  which is guaranteed (the "Guarantee") as
    to timely payment of principal and interest by the United States of
    America, acting through the Administrator of RUS.  The amounts of
    principal and interest payments on the Note held by the Trust are
    sufficient to cover the scheduled principal and interest payments on the
    Certificates issued by the Trust and the scheduled amounts of servicer
    fees.  The General Counsel of the USDA has issued an opinion that the
    Guarantee is supported by the full faith and credit of the United States
    of America.

    Debt service and servicer fee payments on the Note are made to the Trustee
    semi-annually (June 4 and December 4) by the Cooperative or RUS as
    guarantor of the Note.  The Trustee deposits all such receipts in the
    Trust account.  The Trustee is authorized by the Trust Agreement to invest
    all funds in the Trust account at the direction of CFC in certain eligible
    investments that mature no later than the business day next preceding
    the day (June 15 and December 15) such amounts are to be distributed
    to the Certificateholders and the Servicer.  The interest earned on the
    investments is distributed to the Cooperative.  Any funds that are not
    so invested must be held by the Trustee in the Trust account.  The Trustee
    may not reinvest any returns of principal or investment earnings on
    eligible investments and the Trustee may not sell any eligible investment
    prior to its maturity except, at the direction of CFC, to preserve the
    value of the corpus of the Trust.

<PAGE> 14
    On or before five business days after each date on which payments are made
    on the Certificates, the Trustee is obligated to supply the holders of
    such Certificates a report provided by the Servicer, which includes
    certain pertinent information as to how the payment is to be allocated
    to principal, interest, servicer fees and premium, if any, as well as
    the principal balance outstanding after such payment.

    The fiscal year of the Trust is the calendar year.  Within the prescribed
    period of time for tax reporting purposes, after the end of each calendar
    year during the term of the Trust Agreement, the Trustee is obligated
    to prepare and mail to each Certificateholder of record for the Trust,
    at any time during such year, a report setting forth the information as
    is reasonably necessary for the preparation of such Certificateholder's
    Federal income tax return.

    Payments of principal on the Certificates are scheduled to be repaid
    over a period of five years, beginning in 1998.  The principal payments
    over the next 5 years and thereafter are as follows:

<TABLE>
			    <C>            <C>
			    1997           $         0
			    1998             3,100,000
			    1999             3,400,000
			    2000             3,800,000
			    2001             4,200,000
			    Thereafter       4,700,000

			    Total          $19,200,000
</TABLE>

    The Certificates are not subject to redemption prior to December 15, 1997.
    Thereafter, such Certificates are subject to optional redemption, in whole
    and with premium until 2006, upon redemption or purchase of the related
    Note.  The Trust Agreement will terminate after payment in full has been
    made on the Certificates issued thereunder.


2.  TAX STATUS OF THE TRUST

    Milbank, Tweed, Hadley & McCloy, counsel to CFC, has advised CFC with
    respect to the Trust that, in its opinion, (i) the Trust will not be
    classified as an association taxable as a corporation, but will be
    classified as a grantor trust and (ii) each Certificateholder will
    be treated for Federal income tax purposes as the owner of an undivided
    fractional interest in each of the assets held by the Trust.

    It is expected that the Trust will not have any liability for Federal
    or State income taxes for the current or future years.


3.  INTEREST AND SERVICER FEE ACCOUNTING

    The Trust records interest income as it is earned and accrues interest
    expense and servicer fees as they are incurred.  Servicer fees represent
    ten basis points of the outstanding principal balance of the Certificates
    and the Note and recognition of conversion fees over the life of the loan.


<PAGE> 15

4.  FAIR VALUE OF FINANCIAL INSTRUMENTS

    Use Of Estimates

    The preparation of financial statements in conformity with generally
    accepted accounting principles requires management to make estimates
    and assumptions that affect the reported amounts of assets and liabilities
    at the date of the financial statements and the reported amounts of
    expenses during the reported period.  The estimates involve judgments
    with respect to, among other things, various future factors which are
    difficult to predict and are beyond the control of the Trust.  With
    regards to the fair values below, actual amounts could differ from these
    estimates.

    The following disclosure of the estimated fair value of financial
    instruments is made in accordance with FASB Statement No. 107,
    "Disclosure about Fair Value of Financial Instruments."  Whenever possible,
    the estimated fair value amounts have been determined using quoted market
    information as of December 31, 1996 and 1995, along with other valuation
    methodologies which are summarized below.  Below is a summary of
    significant methodologies used in estimating fair value amounts and a
    schedule of fair values at December 31, 1996 and 1995.

    The carrying amounts reported for Interest Receivable, Interest Payable
    - Grantor Trust Certificates, and Servicer Fees Payable approximate
    fair values due to the short term maturity of these instruments.


    Note Receivable

    Fair value is estimated by discounting the future cash flows using
    the current rates at which similar loans would be made to borrowers
    with similar credit ratings and for the same remaining maturities.

    Rural Electric Cooperative Grantor Trust Certificates

    The fair value of the Certificates is estimated using quoted market prices
    for similar notes over the same remaining maturities.

<PAGE> 16
    The carrying and estimated fair values of the Trust's financial
    instruments as of December 31, 1996 and 1995, are as follows:

<TABLE>
<CAPTION>
					     1996                         1995
				   Carrying          Fair        Carrying          Fair
				     Value          Value          Value           Value
<S>                              <C>             <C>            <C>             <C>
Assets:
Interest Receivable                 143,156         143,156        143,156         143,156
Note Receivable                  19,200,000      22,131,385     19,200,000      23,327,630

Liabilities:
Interest Payable-
Grantor Trust Certificates          139,392         139,392        139,392         139,392
Servicer Fees Payable                 3,764           3,764          3,764           3,764
Rural Electric Cooperative
  Grantor Trust Certificates     19,200,000      22,154,222     19,200,000      23,364,584


</TABLE>


<PAGE> 17
<TABLE>
<CAPTION>
	  RURAL ELECTRIC COOPERATIVE GRANTOR TRUST (DESERET) 1988 D-1



			      Exhibit Index

<S>             <C>
Exhibit
Number          Description of Exhibit

 4.1            Form of Trust Agreement, including the form of Rural Electric Cooperative
		Grantor Trust Certificate (incorporated by reference to Exhibit 4.1 to Registration
		Statement on Form S-1 [No. 33-14843]).

10.1            Loan Agreement (incorporated by reference to Exhibit 10.1 to Registration Statement on
		Form S-1 [No. 33-14843]).

10.2            Loan Guarantee and Servicing Agreement (incorporated by reference to Exhibit 10.2 to
		Registration Statement on Form S-1 [No. 33-14843]).


</TABLE>