<PAGE>
 
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                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549
 
                                   FORM 10-K
 
[X]              ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D)
             OF THE SECURITIES EXCHANGE ACT OF 1934 (FEE REQUIRED)
                  For the fiscal year ended December 31, 1995
 
                                      OR
 
[_]        TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                        SECURITIES EXCHANGE ACT OF 1934
 
                         COMMISSION FILE NUMBER 1-8612
 
                             AMERITECH CORPORATION
 
        A DELAWARE CORPORATION                       36-3251481
                                                 I.R.S. EMPLOYER NO.
 
                             30 SOUTH WACKER DRIVE
                            CHICAGO, ILLINOIS 60606
                        TELEPHONE NUMBER 1-800-257-0902
 
SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:
 
                   COMMON STOCK (PAR VALUE $1.00 PER SHARE)
                       PREFERENCE STOCK PURCHASE RIGHTS
 
EXCHANGES ON WHICH REGISTERED:
 
       COMMON STOCK: NEW YORK, CHICAGO, BOSTON, PACIFIC AND PHILADELPHIA
                  PREFERENCE STOCK PURCHASE RIGHTS: NEW YORK
 
SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT: NONE
 
  Based on the average sales price on February 29, 1996, the aggregate market
value of the voting stock held by nonaffiliates was $31,804,315,603.
 
  At February 29, 1996, 555,533,897 common shares and preference stock
purchase rights were outstanding.
 
  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
 
  Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of registrant's knowledge, in a definitive proxy statement or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K [X].
 
                      DOCUMENTS INCORPORATED BY REFERENCE
 
  (1) Portions of the registrant's annual report to security holders for the
year ended December 31, 1995 (Part II).
 
  (2) Portions of the registrant's definitive proxy statement dated March 1,
1996 issued in connection with the annual meeting of shareowners (Part III).
 
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<PAGE>
 
                               TABLE OF CONTENTS
 
<TABLE>
 <C>  <S>                                                                  <C>
                                     PART I
<CAPTION>
 ITEM                                                                      PAGE
 ----                                                                      ----
 <C>  <S>                                                                  <C>
  1.  Business...........................................................    1
  2.  Properties.........................................................   14
  3.  Legal Proceedings..................................................   14
  4.  Submission of Matters to a Vote of Security Holders................   15
      Executive Officers.................................................   15
                                    PART II
      Market for Registrant's Common Equity and Related Stockholder
  5.  Matters............................................................   16
  6.  Selected Financial and Operating Data..............................   16
      Management's Discussion and Analysis of Financial Condition and
  7.  Results of Operations..............................................   16
  8.  Financial Statements and Supplementary Data........................   16
      Changes in and Disagreements with Accountants on Accounting and
  9.  Financial Disclosure...............................................   16
                                    PART III
 10.  Directors and Executive Officers of the Registrant.................   17
 11.  Executive Compensation.............................................   17
 12.  Security Ownership of Certain Beneficial Owners and Management.....   17
 13.  Certain Relationships and Related Transactions.....................   17
                                    PART IV
 14.  Exhibits, Financial Statement Schedules, and Reports on Form 8-K...   17
</TABLE>
 
                                       ii
<PAGE>
 
                                    PART I
 
ITEM 1. BUSINESS.
 
THE COMPANY
 
  Ameritech Corporation (Ameritech or the Company), a holding company
incorporated in 1983 under the laws of the State of Delaware, has its
principal executive offices at 30 South Wacker Drive, Chicago, Illinois 60606
(telephone number 1-800-257-0902). The Company is a leading supplier of full-
service communications and creator of advanced information, entertainment and
interactive services for homes, businesses and governments around the world.
 
  Ameritech operates its business within the framework of customer-specific
business units delivering specialized services to various categories of
customers, each with unique requirements. The functions of the business units,
which include consumer, business, cellular, advertising and leasing services,
as well as services provided to other companies in the communications
industry, overlap the legal entities which form the infrastructure of the
Company. The products and services of all the companies are marketed under the
"Ameritech" brand identity, but the Company's five landline communications
subsidiaries remain responsible within their respective service areas for
providing telephone and other communications services, subject to regulation
by the Federal Communications Commission (FCC) and the respective public
service commissions in Illinois, Indiana, Michigan, Ohio and Wisconsin. In
1995, Ameritech further aligned its business unit and legal entity structure
into three sectors: communications and information products, consumer and
business services and worldwide network systems, to sharpen its strategic
focus and to better position the Company to serve customers and meet the
competition.
 
OPERATIONS UNDER LINE-OF-BUSINESS RESTRICTIONS
 
  Until a new telecommunications law came into effect in February 1996, the
operations of Ameritech and its subsidiaries were subject to the requirements
of a consent decree entitled "Modification of Final Judgment" (Consent Decree)
approved by the United States District Court for the District of Columbia
(Court) in August 1982. The Consent Decree arose out of antitrust litigation
brought by the Department of Justice (DOJ) and required AT&T Corp. (AT&T),
formerly named American Telephone and Telegraph Company, to divest those
assets relating to exchange telecommunications, exchange access functions,
printed directories and cellular communications. The Consent Decree, together
with the Court-approved Plan of Reorganization (Plan), outlined the method of
divestiture and established restrictions on the post-divestiture activities of
the seven regional holding companies (RHCs), including Ameritech, formed to
receive AT&T's divested assets. Effective January 1, 1984, AT&T transferred to
Ameritech its 100% ownership of the exchange telecommunications, exchange
access and printed directory advertising portions of Illinois Bell Telephone
Company; Indiana Bell Telephone Company, Incorporated; Michigan Bell Telephone
Company; The Ohio Bell Telephone Company and Wisconsin Bell, Inc. (referred to
collectively as the "Ameritech landline communications subsidiaries"), as well
as a cellular communications company.
 
  The Consent Decree, as originally approved, prohibited the RHCs from
providing long distance communications services or information services,
manufacturing telecommunications equipment, or providing any product or
service, except exchange telecommunications and exchange access service, that
is not a natural monopoly service actually regulated by tariff. The Consent
Decree allowed the RHCs to provide printed directory advertising and to
provide, but not manufacture, customer premises equipment.
 
  Over time, the Court granted waivers to the RHCs to engage in otherwise
prohibited lines of business upon a showing to the Court that there was no
substantial possibility that the company could use its monopoly power to
impede competition in the market it sought to enter. In decisions handed down
in September 1987 and March 1988, the Court continued prohibitions relating to
equipment manufacturing and long distance services. The rulings allowed
limited provision of information services by transmission of information and
provision of information gateways, but excluded generation or manipulation of
information content. In addition, the rulings
<PAGE>
 
eliminated the need for a waiver for entry into non-telephone related
businesses. In July 1991, the Court lifted the information services ban, but
stayed the effect of the decision pending outcome of the appeals process. Soon
after, the stay was lifted on appeal and in July 1993, the U.S. Court of
Appeals unanimously upheld the Court's order allowing the RHCs to produce and
package information for sale across business and home phone lines. In November
1993, the U.S. Supreme Court declined to review the lower court ruling.
 
  In April 1995, the Court opened the long distance market to the RHCs,
allowing them to offer long distance cellular and other wireless services on
the condition that they demonstrate measurable competition in their own
markets. The ruling allowed the RHCs to resell long distance services provided
by long distance carriers and handle all marketing, billing and discounts, but
imposed a number of conditions which were recently superseded by new
legislation.
 
  On February 8, 1996, the first comprehensive overhaul of telecommunications
legislation in 62 years was signed into law, removing barriers that prevented
the phone, cable TV and broadcast industries from entering each others
businesses. The Telecommunications Act of 1996 addresses various aspects of
competition within, and regulation of, the communications industry. Among other
things, the new law defines the conditions under which Ameritech and the other
RHCs may offer long distance service and provides certain mechanisms intended
to facilitate local exchange competition. The new law removes the Consent
Decree, lifting many prohibitions imposed by the Court, and gives the FCC
responsibility for making new rules governing telephone service. One rule-
making function of the FCC is to determine when the local exchange carriers
have met a 14-step competition test that will allow them to offer long distance
service to their local customers. For the RHCs, immediate relief under the new
law includes permission to provide cellular long distance, in and out of
region, out of region landline long distance and certain other incidental long
distance services. The law eliminates any barriers to companies wishing to
compete against providers of local phone service.
 
AMERITECH'S FULL SERVICE COMMUNICATIONS BUSINESS
 
 Landline Communications Services
 
  Ameritech furnishes a wide variety of advanced communications services,
including local exchange and toll service, network access and communications
products, to approximately 13 million business, residential and communications
company customers in an operating area comprised of 37 Local Access and
Transport Areas (LATAs) in Illinois, Indiana, Michigan, Ohio and Wisconsin.
These LATAs are generally centered on a city or other identifiable community of
interest, and each LATA marks the boundary within which each Ameritech landline
communications company may provide telephone service. The companies provide two
basic types of communications services. First, they transport communications
traffic between a subscriber's equipment and the telephone exchange offices
located within the same LATA (intraLATA service). These services include local
exchange, private line and intraLATA toll services (including 800 and special
services for data, radio and video transport). Second, they provide exchange
access service, which links a subscriber's telephone or other equipment to the
network of transmission facilities of long distance carriers, which in turn
provide communications service between LATAs (interLATA, or long distance,
service). Some sizable areas within the states in which Ameritech operates are
served by nonaffiliated telephone companies. Ameritech does not furnish local
service in the areas served by such companies.
 
  The Company provides directory assistance, local and toll operator services,
including collect calls, third number billing, person-to-person and calling
card calls, and offers such digital network services as voice-mail, on-line
database access and fax messaging, document sharing functions, and video-
conferencing for desktop computers.
 
  Ameritech also provides billing and collection services for several
companies, including billing for long distance services offered by certain long
distance carriers, some of which began billing their own customers in 1996. It
is not possible for the Company to estimate the impact of this change on future
billing and collection revenues due to the uncertainty as to the number of
customers affected, the timing of the billing changeovers and the degree of
acceptance by customers.
 
                                       2
<PAGE>
 
  As of December 31, 1995, 81% of Ameritech's customer lines were served by
digital switches and virtually all its lines had been converted to equal
access. In addition, the Company had installed 1.1 million strand miles of
fiber-optic cable. The number of customer access lines in the Ameritech region
increased by a record 4.5%, from 18.2 million at December 31, 1994 to 19.1
million at December 31, 1995, primarily the result of second line additions as
residential customers installed fax machines, modems and other equipment.
Business lines grew 7.2% from 5.8 million to 6.2 million and residential lines
increased 3.1% from 11.9 million to 12.3 million. Productivity increased 10% to
373 access lines in service per landline communications company employee,
making Ameritech the most productive of the RHCs.
 
  The following table sets forth the number of access lines served by Ameritech
at the end of each of the last five years:
 
                            ACCESS LINES IN SERVICE
                                 (IN THOUSANDS)
 
<TABLE>
<CAPTION>
                                               1995   1994   1993   1992   1991
                                              ------ ------ ------ ------ ------
<S>                                           <C>    <C>    <C>    <C>    <C>
Illinois.....................................  6,258  5,983  5,763  5,586  5,460
Indiana......................................  2,018  1,924  1,855  1,770  1,711
Michigan.....................................  4,979  4,747  4,563  4,431  4,314
Ohio.........................................  3,754  3,609  3,481  3,380  3,314
Wisconsin....................................  2,048  1,976  1,898  1,834  1,785
Total lines.................................. 19,057 18,239 17,560 17,001 16,584
% increase over prior year...................    4.5    3.9    3.3    2.5    1.9
</TABLE>
 
CELLULAR AND OTHER WIRELESS SERVICES
 
  Ameritech provides cellular and other wireless communications to nearly 1.9
million cellular subscribers in Illinois, Indiana, Michigan, Missouri, Ohio and
Wisconsin. Ameritech's cellular business is operated through wholly owned
subsidiaries which are either general or limited partners of partnerships
holding FCC licenses and providing cellular service in the licensed service
area. In 1995, the Company added about 600,000 cellular customers to its base,
a 46% increase over the prior year. In 1996, Ameritech plans to introduce
digital cellular service in the Chicago area. Upon passage of the new
telecommunications law in 1996, the Company began offering long distance
service to its cellular customers in Illinois, northwest Indiana, Michigan,
Ohio, Wisconsin and Missouri.
 
  Subscribers to Ameritech's international wireless joint ventures increased in
1995 to 837,000, more than three times the customer base a year earlier.
Ameritech has formed strategic cellular partnerships in Poland, Norway and
China and has investments in other cellular providers, discussed in the section
on International Growth Opportunities.
 
  The development of the information age has caused an explosion in the market
for managing, storing, processing and using information. Consequently, the
requirement of the network to transport data, in addition to voice messages, is
rapidly increasing. Ameritech's wireless data solutions help mobile workers
respond to their customers faster by enabling such workers to access computer
information at the office, send in information or check a database.
 
  The Company was the first cellular carrier in the country to offer its
customers the ability to use cellular phones in both North America and Europe.
In North America, Ameritech provides national reach to cellular customers
through affiliation with MobileLink, a group of 15 leading cellular companies
serving nearly 85% of the U.S. and Canadian population. The Ameritech Cellular
International Network employs the Global System for Mobile Communications
(GSM), an accepted standard for digital cellular communication. A customer
traveling overseas can make and take calls on a cellular phone much the same as
he or she does domestically. The service can be used in Europe or anywhere GSM
technology is available.
 
                                       3
<PAGE>
 
  The Company currently provides local and nationwide paging services to
customers using approximately 750,000 paging units in Illinois, Indiana,
Michigan, Missouri, Minnesota, Ohio and Wisconsin, an 18% increase over 1994.
In 1994, Ameritech won the narrowband personal communications services (PCS)
regional license to offer two-way paging in the Midwest. The Company plans to
offer 2-way paging to customers regionwide beginning in 1997. The return
paging channel will allow users of two-way pagers to acknowledge a page and,
eventually, to provide a detailed response.
 
  In 1995, Ameritech acquired broadband PCS licenses in the Cleveland and
Indianapolis major trading areas. These licenses cover almost 8 million
potential customers and will provide an effective complement to the Company's
existing cellular and landline networks. Ameritech is currently offering
wireless services to customers in Indianapolis and Cleveland through reselling
agreements and plans to provide facility-based services beginning in 1997.

 Directories and Electronic Advertising Services
 
  Ameritech provides directory and electronic advertising opportunities to
local, regional and national businesses throughout the Great Lakes region and
serves as an advertising and marketing consultant. The Company publishes more
than 430 Ameritech PagesPlus(R) white and yellow pages directories in Indiana,
Wisconsin, Ohio and Michigan and, in partnership with Donnelley Directory, in
Illinois and northwestern Indiana, with a total distribution of over 41
million. Utilizing audiotex technology, Custom Connect(TM) audiotex, available
24 hours a day, 7 days a week, provides consumers and advertisers with a wide
range of information opportunities accessible through special phone numbers.
Consumers can call for up-to-date information including news, sports and
weather, as well as information about specific products or services.
Advertisers can provide consumers with updated messages about their
businesses, such as sales, discounts and special hours.
 
  Ameritech is assessing the role it will play in the emerging world of the
Internet and is currently developing products and services that will include
new content, add leverage to its present content investments and complement
Ameritech's existing product lines.

 Leasing
 
  Ameritech has provided competitive, value-added financing to approximately
5,000 customers in all 50 states, primarily large and medium-sized businesses
and governmental units. The Company has financed more than $1.3 billion worth
of equipment and services since 1984.

NEW SERVICES
 
  Ameritech is developing other products and services to keep up with the
accelerating pace of fast-growing communications markets.

 Cable TV
 
  One year after receiving permission from the FCC to use video dialtone to
transport movies and other video programming to customers' homes, Ameritech
took alternate steps to provide that service. In the face of regulatory
uncertainty over interpretation of video dialtone rules, Ameritech became the
first RHC to enter the video business as a cable TV provider. Rather than
deploy integrated facilities, Ameritech created a separate subsidiary to build
a state-of-the-art two-way video system and develop content. The Company has
secured ten franchise agreements and has initiated discussions with more than
30 other communities in the Chicago, Detroit, Milwaukee, Cleveland and
Columbus areas.
 
  Ameritech, GTE Corporation, The Walt Disney Company, BellSouth Corporation
and SBC Corporation are equal partners in a venture designed to develop,
acquire, package and market traditional and interactive video programming to
millions of consumers nationwide. The Los Angeles-based joint venture, called
Americast, is being funded collectively by the partners with $500 million over
a five-year period. Americast's combined reach
 
                                       4
<PAGE>
 
encompasses some 68 million access lines in 33 states, including some of the
fastest growing regions of the nation. Key potential markets include Atlanta,
Chicago, Cleveland, Columbus, Dallas, Detroit, Houston, Los Angeles, Miami,
Raleigh/Durham, Seattle, St. Louis, Tampa/St. Petersburg and a large portion
of southern California. Initially, the americast(TM) package of programming
delivered by Ameritech will be a comprehensive offering of 80 to 90 channels
which could expand to include several hundred channels in the next few years.
The venture plans to develop a navigator, software that creates an on-screen
viewing environment, to allow customers to access these services with ease.
Ameritech plans to begin offering services to consumers in selected areas in
1996.
 
  While Federal regulations initially prevented the Company from providing its
own programming, the U.S. Supreme Court heard the information age debate on
whether or not local exchange carriers have a free-speech right to offer cable
television programming in their own service areas. Congress decided the issue
first. The new telecommunications law reaffirmed Ameritech's authority to
enter the video marketplace as either a cable TV provider or as a common
carrier platform provider. As a result, the Company continues its aggressive
plans to bring consumers a choice in cable TV.
 
 Security Monitoring
 
  In 1995, Ameritech expanded its presence in the high-growth security
monitoring business by completing the acquisition of The National Guardian
Corporation, headquartered in Greenwich, Connecticut. This strategic move,
together with last year's purchase of SecurityLink, expanded Ameritech's
portfolio of interactive services and ranks the Company, with 340,000
customers coast to coast, as the second largest provider in the United States.
 
  Under the new telecommunications law, Ameritech is prohibited from acquiring
additional equity in alarm monitoring firms for five years. Other RHCs are
barred from entry into the business for five years from the date of enactment
of the law.
 
 Long Distance Services
 
  When Ameritech first unveiled its Customers First plan in 1993, becoming the
first company in the U.S. communications industry to voluntarily offer to open
its local network to competitors, it sought regionwide freedom to compete in
both its existing businesses and long distance services. In exchange, to
facilitate competition in the local exchange business, the Company would allow
other service providers to purchase components of its network and to repackage
them with their own services for resale. Ameritech proposed to change the way
local communications services are provided and regulated and to furnish a
policy framework for advanced universal access to modern communications
services--voice, data and video information. Under the plan, customers would
be able to choose from competitive providers for local service as they now can
choose a provider for long distance service. In 1995, the Company sought
permission to enter the interLATA market on a trial basis in Chicago and Grand
Rapids, Michigan, in order to demonstrate conclusively the substantial
customer and economic benefits of full competition.
 
  Much of the detailed language of the new telecommunications law was based on
Ameritech's plan. Under the law, Ameritech and the other RHCs must comply with
a checklist to ensure competition before they can offer long distance service
to their local landline customers. The FCC will determine whether or not an
RHC's entry into the long distance market serves the public interest. An RHC
is restricted from providing long distance service until a competitor provides
local phone service to its residential and business customers. The FCC will
have to give substantial weight to DOJ recommendations in reviewing RHC entry
into the market. In preparation, the Company has signed and is currently
negotiating local network resale agreements with companies planning to offer
local exchange service in 1996, giving Ameritech a lead in complying with the
competition checklist. The Company expects to offer landline long distance
service in its five-state region in early 1997 beginning in Illinois and
Michigan.
 
                                       5
<PAGE>
 
  Under the law, Ameritech and the other RHCs were allowed to provide long
distance service immediately to their cellular customers, regardless of
location. The Company is currently offering long distance service to its
cellular customers in Illinois, northwest Indiana, Michigan, Ohio, Wisconsin
and Missouri.
 
 Electronic Commerce
 
  Ameritech has invested $472.5 million in GE Information Services (GEIS), a
wholly owned subsidiary of General Electric Company (GE) and a leader in the
global electronic commerce market. Electronic commerce links companies and
internal organizations to each other and to customers, suppliers, banks,
financial services providers and distributors in virtual electronic trading
communities to simplify day-to-day transactions. Typical electronic commerce
applications involve order entry and processing, invoicing, electronic payment,
inventory management, cargo tracking, E-mail, electronic catalogs and point-of-
sale data gathering. Presently, GEIS serves 40,000 customers worldwide.
Ameritech's investment in GEIS is in the form of a four-year interest bearing
convertible debenture which, when certain legal restrictions are removed,
converts into a 30% equity interest in GEIS. The debenture has been guaranteed
as to repayment by GE. The debenture is due on May 2, 1998 and may be extended
by Ameritech by one year under certain circumstances. In 1995, GEIS agreed to
provide MATAV, the primary telecommunications provider in Hungary and in which
Ameritech owns an interest (see International Growth Opportunities), with
electric data interchange technology, thus enabling MATAV to offer its business
and government sector customers enhanced information management capabilities.
 
 On-Line Services
 
  Ameritech is pursuing alliances and partnerships that will position the
Company as a key participant in the emerging interactive video industry,
exploring a variety of services with many different suppliers of traditional
cable TV offerings, video-on-demand, home health care, interactive educational
courses, distance learning, interactive games and shopping and other
entertainment and information services.
 
  Ameritech has invested in Peapod, an interactive home grocery shopping and
delivery service. Using a personal computer, more than 14,300 customers in the
Chicago and San Francisco areas can choose from thousands of grocery items and
schedule home delivery at their convenience. In 1995, Peapod expanded service
by 30%.
 
  The Company has invested in two more companies planning to revolutionize the
way consumers select and purchase entertainment and educational products. The
Company holds an approximate 20% interest in MN Interactive, Inc. which uses
on-line links, CD-ROM, dial-up connections and voice mail to provide music
previewing, ordering and delivery of the latest music CDs from the libraries of
major and independent record producers. MusicNet(TM), MNI's flagship product,
is a personalized, interactive music previewing and shopping service available
on CD-ROM, telephone and, soon, through the Internet. The Company also has an
equity investment in KidSoft, LLC, the leading brand for quality educational
software for kids through on-line and retail channels. Ameritech plans to offer
specialized versions of MNI's and KidSoft's services through its future on-line
and broadband service offerings.
 
  Random House and Ameritech each own more than 40% of Worldview Systems
Corporation, the leading supplier of electronic travel and entertainment
information, with the remainder held by the firm's management team. The
company's product, Fodor's Worldview Travel Update, offers customers, by fax,
on-line information services or mail, time-sensitive destination information
that complements Fodor's extensive catalogue of printed guidebooks. Through
Travelocity (SM), a new Internet service, customers can make reservations, buy
tickets, access entertainment information and buy travel guides on-line.
 
  Over 2,000 doctors, hospitals, pharmacies, laboratories, employers and others
in the health care industry use Ameritech health information networks to share
clinical, demographic, financial and claims data. Patients and providers
benefit from timely and improved communication, less paperwork, reduced
administrative overhead and ease of access. In Wisconsin, in partnership with
Aurora Health Care of Milwaukee, Ameritech
 
                                       6
<PAGE>
 
developed the Wisconsin Health Information Network, recognized by the industry
as the only proven, functional community network in the nation. The Company has
expanded into other U.S. markets with solutions that incorporate networking and
strategic applications.
 
  CivicLink (SM), an innovative service that offers on-line access to publicly
available court records and legal documents, is a product introduced by a joint
venture between Ameritech and British Columbia Systems Corporation (BC
Systems), a Crown corporation of the Province of British Columbia, Canada.
Without replacing the usual method of accessing court information, CivicLink
streamlines the process assuring up-to-date information and saving the public
time and effort. CivicLink is currently in operation in Marion County, Indiana,
Prince George's County, Maryland and Los Angeles County, California. Service is
expected to be available in DuPage County, Illinois in April 1996, followed by
Kane, DeKalb and Kendall Counties, also in Illinois.
 
 Distance Learning
 
  Distance learning employs interactive video, fax machines, electronic
blackboards and other forms of information delivery to enable teachers and
students in a classroom to share lessons and discussions with students and
teachers in distant locations. Ameritech has built interactive distance
learning networks throughout the Midwest. The benefits extend far beyond
remedying the disadvantages of the rural classroom. Distance learning links
geographically dispersed university campuses and connects secondary schools
with institutions of higher learning, broadening the students' learning
experiences.
 
 Library Services
 
  Library automation is also breaking the constraints of time and space.
Ameritech Library Services offers access to the world's greatest research
collections through a full range of automated library management systems, as
well as products that provide access to information databases and networks,
creating virtual libraries which potentially can encompass huge bodies of
knowledge. Ameritech is the worldwide leader in this business, supporting over
3,700 libraries throughout the United States and in 31 other countries.
Customers include the New York Public Library, Microsoft Corporation, Yale and
Harvard universities, The Smithsonian Institute and The Library of Congress.
 
 Managed Services
 
  In 1995, Ameritech and IBM Corporation formed an alliance that establishes
the companies as leaders in the fast-growing $30 billion desktop computing and
communications market. The companies will jointly market integrated voice, data
and video managed desktop services for businesses, providing customers with a
single point of contact for managing every aspect of desktop-based
communications and computing systems, including personal computers, software,
telephones, videoconferencing, PBXs, local area networks and more. The venture
will establish a 24-hour customer service facility to provide technical and
consulting support for these services. The center, which will deliver single
help desk capability currently unavailable from any other provider, will be
built at a site within the Ameritech region.
 
  Williams Telecommunications Systems, Inc. (WilTel) has entered into an
agreement with Ameritech under which the companies will provide managed
services for each others' business customers in certain markets across the
United States. WilTel's nationwide resources will provide additional assistance
to the Company in immediately meeting the growing managed services requirements
of Ameritech's customers on a consistent and efficient basis.
 
INTERNATIONAL GROWTH OPPORTUNITIES
 
  Beginning in 1990, Ameritech has made international investments in such
markets as Germany, New Zealand, Hungary, Poland, and Norway, and has
established offices in China and Belgium. Foreign investments will grow to
nearly $4 billion in value in 1996, including a pending investment in Belgium.
The Company expects to continue to pursue opportunities for global expansion.
 
                                       7
<PAGE>
 
  The Company has invested in two of the world's largest privatizations, in New
Zealand and Hungary, and will invest in a third in Belgium in 1996. In 1990,
Ameritech and Bell Atlantic Corporation (Bell Atlantic) purchased Telecom
Corporation of New Zealand Limited (New Zealand Telecom), New Zealand's state-
owned principal supplier of domestic and international communications services,
including local, long distance, cellular, satellite TV and directory services,
serving 1.8 million customer lines and 344,000 cellular customers. After public
offerings and private sales of the stock of New Zealand Telecom required by the
government at the time of the acquisition, Ameritech and Bell Atlantic each
have a 24.8% interest in the company. During 1995, New Zealand Telecom boosted
its profits by 16%.
 
  Since 1993, Ameritech and its German partner, Deutsche Telekom AG (Deutsche
Telekom), Europe's largest communications carrier, have had an investment in
MATAV, the Hungarian telecommunications company. In 1995, MagyarCom, the
alliance between Ameritech and Deutsche Telekom, increased its investment from
30% to 67% of the company. The Hungarian government owns most of the remaining
33%. MATAV is the principal provider of local, long distance and international
telephone service and the controlling shareowner in a cellular venture using
GSM digital technology. MATAV has approximately 1.8 million access lines in a
country of 10.5 million people. With hundreds of thousands of customers on the
waiting list, MATAV plans to increase the number of lines in service 15.5% in
1996 with a goal of 3 million lines in service by the year 2000.
 
  In 1995, Ameritech and its consortium partners, Tele Danmark A/S and
Singapore Telecommunications Limited (Singapore Telecom) were selected as
strategic partner for Belgacom S.A., the national telecommunications operator
in Belgium. The consortium will pay approximately $2.5 billion for a 49.9%.
interest in Belgacom--Belgium's largest single investment by an American
company and its largest commercial transaction. Ameritech will have a 35%
consortium share, or about 17.5% of Belgacom. Closing with the Belgian
government is scheduled for the first quarter of 1996.
 
  Since 1992, another Ameritech consortium has operated an analog cellular
system, Centertel, in Poland. Ameritech and France Telecom, in partnership with
Telekomunikacja Polska S.A., Poland's state-owned telephone company, created
the joint venture, Polska Telefonia Komorkowa (PTK), to build the nationwide
cellular system. Telekomunikacja Polska owns 51% of the joint venture, with
Ameritech and France Telecom holding equal shares of the remainder. Centertel
provides service to approximately 75,000 of the 36 million people in Poland, in
all major cities and along all major highways. The Company is currently
involved in arbitration with the government of Poland over the government's
failure to award a GSM digital cellular license to Ameritech as agreed in the
1992 contract.
 
  Since 1993, Ameritech and its partners in NetCom GSM have provided digital
cellular service in Norway. In 1992, Ameritech and Singapore Telecom acquired
an equal interest in NetCom totaling an effective 49.9%. Their agreement with
NetCom includes a management service contract under which Ameritech and
Singapore Telecom provide their skills and expertise in operating the system.
In 1995, NetCom tripled its customer base to 235,000 customers. Nationwide
coverage by the NetCom system is expected within two years. Analysts estimate
that the usage of GSM service in Norway could be extended to 700,000 Norwegian
customers over the next decade. At 20%, Norway has the highest per capita use
of cellular telephones in the world.
 
  As a result of a 1995 acquisition, "Wer liefert was?" (Who supplies what?),
Ameritech's business purchasing guide publisher in Europe, now produces and
distributes business-to-business directories to over 70,000 customers in
Germany, Austria, Switzerland, Belgium, Luxembourg, the Netherlands, the Czech
Republic, Croatia, Slovakia and Solenia. "Wer liefert was?" is a market leader
with the ability to provide current information on more than 200,000 companies
in printed book form, on CD-ROM and on-line. Ameritech owns 100% of "Wer
liefert was?," purchased by the Company in 1990.
 
  In 1995, Ameritech opened an office in Beijing and announced a 25-year joint
venture with China Communications System Company Ltd. (Chinacom), a
communications systems and engineering company, to assist the People's Republic
of China in the development of its telecommunications sector. The joint
venture, Ameritech's first in China, and Chinacom's first with a U.S.
communications company, will provide funding, advanced communications
technology and management consulting to assist China in achieving its
 
                                       8
<PAGE>
 
telecommunications development goals. The venture initially will build a GSM
cellular telephone and wireline switched telephone network for Taiyuan, the
capital of Shanxi province. Upon completion, China Unicom, an authorized
carrier, will operate the network. Chinese law officially prohibits foreign
entities from operating communications networks in China. However, there are
indications that the law may change in the future.
 
 Other Business Interests
 
  Ameritech, in an arrangement with Household International, Inc. (Household),
offers a no fee, dual-purpose credit card and calling card, the Ameritech
Complete (SM) Card. The Complete Card is offered as either a Visa or MasterCard.
Consumers may use the card to charge telephone calls as well as goods and
services. The Complete Card has no annual fee and competitive interest rates, a
10% cash back offer from Household for all calling card calls made by dialing
"0" plus the telephone number, and a second cash back feature on credit card
purchases of up to 1% with no limit on how much cash can be earned. Under the
arrangement between the companies, Household owns and finances the credit card
receivables and Ameritech funds certain marketing expenses. Since its
introduction in 1991, the Complete Card has attracted nearly one million
cardholders and membership has grown by 25% annually.
 
  In April 1995, the RHCs announced plans to sell their jointly owned research
arm, Bell Communications Research, Inc. (Bellcore). Ameritech owns an equal
one-seventh interest in the company. Bellcore furnishes the RHCs with technical
support, such as applied research, network planning, engineering and software
development. Bellcore has served as a central point of contact for coordinating
the efforts of the RHCs in meeting national security and emergency preparedness
requirements of the Federal government. A final decision regarding disposition
of the RHC interests in Bellcore will be subject to unanimous agreement on the
structure of the transaction and obtaining necessary regulatory approvals.
Bellcore, based in Morristown, New Jersey, has about 6,100 employees and annual
revenue of about $1 billion.
 
REGULATORY ENVIRONMENT--FEDERAL
 
  The Ameritech landline communications subsidiaries are subject to the
jurisdiction of the FCC with respect to interstate services. The FCC prescribes
for communications companies a uniform system of accounts, rules for
apportioning costs between regulated and nonregulated services, and the
principles and standard procedures (separations procedures) used to separate
regulated property, plant and equipment costs, revenues, expenses, taxes and
reserves between those applicable to interstate services under the jurisdiction
of the FCC and those applicable to intrastate services under the jurisdiction
of the respective state regulatory authorities.
 
 Access Services
 
  Ameritech provides access services that allow long distance carriers and
other companies to originate and terminate interstate and intrastate
communications services using the facilities of the Company. Access charges,
which recover the Company's costs associated with such facilities, consist 
primarily of three types: common line, traffic sensitive and trunking.
 
  Common line charges are recovered through separate charges applied to end
users (monthly subscriber line charges) and long distance carriers. The FCC has
authorized subscriber line charges of up to $3.50 per access line per month for
residential and single line business customers and up to $6.00 per access line
per month for multiple line business customers. The remaining portion of the
interstate common line revenue requirement is recovered by means of usage-based
long distance carrier common line charges.
 
  Traffic sensitive charges are usage-based charges billed to long distance
carriers which are associated with central office switching facilities used in
the provision of access services and cable and wire facilities that connect
customers through common facilities from the Company's end office, where
switching occurs, to the serving wire center, where access is provided.
 
  Trunking services consist of two types: those associated with the local
transport element of switched access and those associated with special access.
Trunking services associated with switched access handle the
 
                                       9
<PAGE>
 
transmission of traffic through dedicated facilities from the Company's end
office where switching occurs to the serving wire center (including the
entrance facilities to the long distance carrier) where access is provided.
Trunking services associated with special access handle the transmission of
interstate private line services using dedicated facilities between any two
customer-designated premises or between a customer-designated premise and an
Ameritech end office where multiplexing, the transmission of two or more
signals over a single channel, occurs. Trunking charges are fixed monthly
charges per access line which in certain cases involve a distance element
associated with the dedicated facilities used to provide the trunking service.
 
  In 1994, the FCC initiated its review of interstate price cap regulation
initially adopted effective January 1, 1991. The FCC's price cap regulatory
scheme sets maximum limits on the prices that local exchange carriers can
charge for access services. The limits are adjusted each year to reflect
inflation, a productivity factor and certain other cost changes. Local
exchange carriers under price caps have increased flexibility to change prices
of existing services within the common line, traffic sensitive and trunking
access revenue categories, as well as for interexchange (interstate intraLATA)
and video dial tone service offerings. In March 1995, the FCC adopted changes
to its price cap plan to be effective August 1, 1995. The new rules include
changes to the measure of inflation, the introduction of new productivity
factor options and changes in the definition of other costs which may be
included in the price cap formula. Under the new rules, local exchange
carriers can annually elect one of three productivity factors: 4.0%, 4.7% or
5.3%. Ameritech's election of the 5.3% productivity factor allowed the Company
to retain all of its earnings, whereas election of a lower factor would
require earnings to be shared with customers. Concurrently, Ameritech filed a
waiver request with the FCC to make an additional downward adjustment of its
indices to apply the 5.3% productivity factor retroactively to January 1,
1995.
 
OTHER MATTERS
 
  In 1995, the FCC set new rules for allowing foreign companies into the U.S.
communications market. U.S. companies' access to foreign markets will now be a
key factor in deciding whether firms from those countries can offer
international calls from the U.S. According to the FCC, approximately 91% of
foreign markets are currently closed to competition, about 7% have limited
competition and 2% are open to competition.
 
REGULATORY ENVIRONMENT--STATE
 
  The Ameritech landline communications subsidiaries are also subject to
regulation by state commissions with respect to certain intrastate rates and
services and other matters.
 
 Illinois
 
  In May 1992, legislation permitting new forms of regulation was passed by
the Illinois General Assembly. The new law enabled the Illinois Commerce
Commission (ICC) to approve alternative regulation of any type, subject to
explicit policy goals.
 
  In October 1994, the ICC largely approved Ameritech's Advantage Illinois
initiative. The ICC order called for an immediate rate reduction of $93.2
million on specified services and set a five-year cap at current levels on
basic residential service rates and residential usage rates. Under the plan,
noncompetitive services are assigned to one of four service categories and
price changes are based on a formula which considers inflation, a
service/quality factor, a productivity offset and a factor to allow for costs
which are outside the Company's control. Additional pricing flexibility
continues to be available for competitive services. The plan also ends the
ICC's oversight of the Company's intrastate depreciation rates. The Company
made a $3 billion infrastructure commitment over a five year period. Ameritech
has appealed this order on several bases, including implementation of $51
million in rate reductions based on revenues imputed for directory
publication. Other parties have also appealed the Commission's decision.
 
  In May 1995, the Company filed tariffs with the ICC to implement the
Company's Customers First Plan to open its local network to competitors. In
August, the Company filed tariffs to allow customers beginning in April 1996
to choose an alternate long distance carrier for intraLATA toll calls by
dialing 1 before the regular phone number (1+ capability).
   
                                      10
<PAGE>
 
 Indiana
 
  In 1994, the Indiana Utility Regulatory Commission (IURC) approved
Ameritech's Opportunity Indiana plan. Under the plan, market based pricing and
flexibility by means of pure price regulation has been instituted for
competitive services, including Centrex, dedicated communications services,
800 service, WATS, operator services and business intraLATA toll service.
Monthly rates for basic local residential service will decrease by more than
two dollars over two years and remain capped until 1998. IURC oversight of
depreciation was suspended for the term of the plan. In addition, Ameritech
will invest up to $120 million in infrastructure over six years to extend
advanced communications links to interested schools, hospitals and major
government centers. Indiana is a national leader in the use of distance
learning to enhance education.
 
 Michigan
 
  Under the Michigan Telecommunications Act of 1991, which expired December
31, 1995, there was no cap on earnings or regulatory oversight of depreciation
rates. The prices of basic services, defined as residence and business access
lines and local calling, were subject to a price cap formula. IntraLATA toll
prices were capped through December 31, 1995 at December 31, 1991 levels.
 
  Beginning January 1, 1996, consumers in certain Ameritech exchange areas
were able to use 1+ capability for intraLATA toll calls. Under the Michigan
Telecommunications Act of 1995, Ameritech was required to designate 10% of its
exchanges for this capability. More customers will be given this capability as
the Company is permitted to offer interLATA long distance service. Further,
the Michigan Public Service Commission is directed to take steps toward
removing interLATA barriers.
 
  Under the new law, the Company is authorized to restructure local exchange,
toll and access rates to address historical subsidies built into rates, ending
rate regulation of intraLATA toll and payphone services and streamlining the
procedures to obtain increases in local exchange rates.
 
 Ohio
 
  In January 1995, Ameritech implemented its Advantage Ohio price regulation
plan following approval by the Public Utility Commission of Ohio (PUCO). Under
the plan, future overall rate changes are subject to price ceilings based on
inflation, a productivity factor, a service/quality factor and significant tax
law or accounting rule changes. Rates for all services were capped in 1995 and
rates for basic access lines and usage were capped for an additional five
years. The plan provides for the ability to flexibly price competitive and
discretionary services. A series of rate reductions totaling $84.4 million
annually are being phased in over a six year period including reductions in
the rates for residential local usage and access lines, reductions in carrier
access charges and the deaveraging of access line rates. Under the plan, the
PUCO no longer oversees depreciation rates or practices. The Company has
committed to meeting certain benchmarks for the deployment of advanced
technology, including interoffice fiber optics and digital switching.
 
  On March 5, 1996, the Ohio Supreme Court released an opinion reversing the
PUCO's order that approved the Advantage Ohio plan and remanding the matter to
the Commission. The court ruled that the Commission exceeded its statutory
authority when it used alternative rate-setting methods to establish
Ameritech's basic local exchange service rates because of the procedure
followed by the Company and the Commission. The outcome of the court's opinion
on alternative regulation and rates cannot be determined at this time.
 
 Wisconsin
 
  In June 1994, the Wisconsin legislature passed a new telecommunications bill
which established a pricing formula for regulated services, including
residential and small business access lines, local calls and basic intraLATA
calls. The formula considers inflation, service quality and infrastructure
investment, plus a productivity offset. Prices for other services are not
subject to Public Service Commission of Wisconsin (PSCW) approval.
Depreciation rates can be set by the Company within a range of rates
established by the PSCW. Ameritech filed tariffs to adopt pure price
regulation effective September 1, 1994. Prices were reduced by $35
   
                                      11
<PAGE>
 
million on an annualized basis. An additional $10 million carrier common line
access charge reduction will be phased in over a two year period ending in
1996. Under the terms of the bill, Ameritech committed to at least $700 million
on new equipment and technology over five years extending fiber optics to
hundreds of secondary schools, technical colleges, universities, hospitals and
federated libraries in the region.
 
  Effective January 1, 1996, 1+ capability began to be implemented in
approximately 10% of the Company's service areas in Wisconsin. Remaining areas
are scheduled for implementation throughout 1996. Ameritech has filed an appeal
of the PSCW 1+ decision, declaring it contrary to public interest and anti-
competitive in view of restrictions on the Company's ability to provide
interLATA service.
 
 Other Matters
 
  In addition, Ameritech is a party to various proceedings pending before the
state commissions which involve, among other things, the terms and conditions
of services provided by the Company, unbundling the local network, number
portability and 911 access.
 
  In 1995, the state commissions in Illinois, Ohio, Michigan and Wisconsin
conducted investigations of the Company's service quality as a result of
Ameritech's failure to meet certain minimum service standards required under
state regulations. The Company's service problems in the summer of 1995
resulted from severe weather that caused service disruptions, as well as
manpower shortages because of an early retirement offer in 1994 and 1995 that
proved more popular than expected. The Company has paid fines to the
commissions and issued bill credits for lost service, and is taking steps
necessary to return service to a high standard, including the addition of 4,000
employees in customer service positions.
 
COMPETITION
 
  The communications industry is undergoing significant changes. Local exchange
carriers and long distance service companies, cable TV companies, cellular
service providers, computer companies and the entertainment and information
services industries are converging, forming alliances and positioning to
provide a variety of services. Market convergence, already a reality,
intensified in 1995. Regulatory, legislative and judicial decisions, and
technological advances, as well as heightened customer interest in advanced
communications services, have expanded the types of available communications
services and products, as well as the number of companies offering such
services.
 
  The primary competitors in Ameritech's core business (local landline
telephone service, wireless service and directories) historically have been
other access providers, other cellular service providers and other advertising
media. AT&T, MCI Communications Corp. and other long distance providers are
ready to offer local phone service in various parts of Ameritech's five-state
region. Companies, such as AT&T and McCaw Cellular Communications, Inc., have
allied to form expanded cellular markets, creating the possibility of a
wireless network with nationwide presence and brand-name recognition. Tele-
Communications, Inc., Comcast Corp. and Cox Cable Communications are part of a
cable company joint venture with Sprint Corporation that plans to offer
alternative wireless service. Various communications groups, including almost
all the nation's largest phone and cable companies, hold licenses to offer PCS
throughout the U.S. Competitors of the directory publishing business are
advertisers using traditional advertising media, such as television, radio,
direct mail, billboards, interactive on-line services, and magazine and
newspaper advertising. Today, many of the companies planning to provide local
telephone service also have directory operations. Increased competition in the
local exchange service business, as well as the technological innovations
rapidly spawned by that business, will further intensify competition.
 
  As the Company expands and diversifies into other areas, including video,
home security, home shopping, the Internet, CD-ROM technology, on-line
services, phone cards and global long distance service, the number and variety
of competitors will grow dramatically. Much of the competition is from
companies with substantial capital, technological and marketing resources, many
of which do not face the same regulatory constraints as the
 
                                       12
<PAGE>
 
Company. In pursuit of business opportunities outside of the United States,
Ameritech faces competition from other RHCs, long distance service providers
and a variety of foreign entities. Notwithstanding the potential for an
adverse effect on many revenue streams of the Company, Ameritech expects to
capture a major share of the expected growth in the communications
marketplace. Building on its strengths, the Company plans to branch into new
services that are a logical extension of its core business, exporting its
expertise to customers throughout the world.
 
  Regulatory reform continues to be one of the most significant issues facing
the communications industry today. The Company believes that relief from
excessive regulation will benefit customers and ultimately shareowners by
enabling the Company to compete effectively and meet customers' expanding
needs. Ameritech is seeking relief before the regulatory agencies from the
restraints, laws and regulations that impose restrictions on its current
business and curtail its future business offerings.
 
  Sweeping new federal legislation signed in February 1996, will radically
alter the U.S. communications business and enhance the Company's ability to
compete abroad in advanced communications services and equipment. Passage of
the new law broadly deregulates the communications industry and allows cable
TV, local phone companies and long distance carriers into each other's
businesses, removing the formal barriers between businesses and reshaping the
information industry.
 
  The Company's competitive strategy includes positioning itself to take
advantage of future opportunities by streamlining its processes to continue to
be the most efficient of the RHCs.
 
PATENTS, TRADEMARKS AND LICENSES
 
  Ameritech and its affiliates own, have licenses to use, and license others
to use various patents, copyrights, trademarks and other intellectual property
which are necessary for them to conduct their present business operations. It
is not anticipated that any such intellectual property will be subject to
expiration or nonrenewal of rights which would materially and adversely affect
Ameritech or its affiliates.
 
EMPLOYEE RELATIONS
 
  As of December 31, 1995, the Ameritech companies employed 65,345 persons, an
increase from 63,594 at December 31, 1994. By year end 1995, approximately
11,500 nonmanagement employees had resigned or retired in response to an early
retirement offer announced in 1994 (2,400 of which left in 1995). Under terms
of agreements between Ameritech, the Communications Workers of America (CWA)
and the International Brotherhood of Electrical Workers (IBEW), Ameritech
implemented an enhancement to the Ameritech pension plan by adding three years
to the age and the net credited service of eligible nonmanagement employees
who left the business during a designated period ending with contract
expiration, a period extended during contract negotiations to the end of the
third quarter of 1995. In addition, certain of the Company's business units
offered financial incentives under terms of the prior contracts with the CWA
and IBEW to selected nonmanagement employees who left the business by contract
expiration. Staff additions offset these departures. New employees were added
to accommodate the Company's growth, to ensure high quality customer service
and to meet staffing requirements for new business opportunities. In 1996, as
a result of a planned consolidation of the Company's data centers and other
reductions, more employees will leave the Company.
 
  In September 1995, members of the CWA and the IBEW ratified new three-year
contracts with Ameritech. The new contract wage increases were retroactive to
the expiration dates of the prior contracts, June 25 for the IBEW and August 6
for the CWA. Both contracts address wages, benefits, pensions, employment
security, child and family care, training and retraining and other conditions
of employment. Base wages were increased approximately 10.9% compounded at the
maximum wage rate over the next three years. In addition all eligible
employees received a lump sum bonus of $500. The new contracts will expire on
June 27, 1998, for the IBEW and August 8, 1998, for the CWA. The two unions
represent more than 40,000 of Ameritech's 65,000 employees. Of those so
represented, about 71% are represented by the CWA and about 29% are
represented by the IBEW, both of which are affiliated with the AFL-CIO.
 
                                      13
<PAGE>
 
ITEM 2. PROPERTIES.
 
  The properties of the Company do not lend themselves to description by
character and location of principal units. At December 31, 1995, the Company's
investment in property, plant and equipment consisted of the following:
 
<TABLE>
      <S>                                                                   <C>
      Land and buildings...................................................  10%
      Central office equipment.............................................  40
      Cable, wiring and conduit............................................  40
      Other................................................................   9
      Under construction...................................................   1
                                                                            ---
                                                                            100%
</TABLE>
 
  Central office equipment includes analog and digital switching equipment,
transmission equipment and related facilities. Buildings are principally
central offices. Cable, wiring and conduit constitute outside plant, and
includes poles as well as cable, conduit and wiring primarily on or under
public roads, highways or streets or on or under private property.
Substantially all of the installations of central office equipment and
administrative offices are located in buildings owned by the Ameritech landline
communications subsidiaries and situated on property they own. Many garages and
business offices and some installations of central office equipment and
administrative offices are in leased quarters.
 
  As a result of an ongoing review of Company assets and an assessment of
future needs, Ameritech sold, or will no longer use in the business, certain
real estate across the region and other assets, thereby reducing costs and
improving asset utilization.
 
  Capital expenditures, the single largest use of Company funds, were as
follows for the last five years:
 
<TABLE>
<CAPTION>
                                                           (DOLLARS IN MILLIONS)
      <S>                                                  <C>
      1991................................................        $2,200
      1992................................................         2,267
      1993................................................         2,108
      1994................................................         1,955
      1995................................................         2,176
</TABLE>
 
  Ameritech plans to maintain capital spending at about $2 billion per year,
which will include capital provided to its long distance, cable TV and security
monitoring businesses. The Company's capital expenditures for property, plant
and equipment for its landline communications company operations decreased
about $30 million in 1995 as capital was deployed more cost effectively and
with greater focus on the requirements of customers and the development of new
services, including cable TV, security monitoring and long distance. Rapid
modernization of the landline communications network continued through 1995.
 
ITEM 3. LEGAL PROCEEDINGS.
 
PRE-DIVESTITURE CONTINGENT LIABILITIES AGREEMENT
 
  The Plan provides for the recognition and payment of liabilities that are
attributable to pre-divestiture events (including transactions to implement the
divestiture) but that do not become certain until after divestiture. These
contingent liabilities relate principally to litigation and other claims with
respect to the former Bell System's rates, taxes, contracts, equal employment
matters, environmental matters and torts (including business torts, such as
alleged violations of the antitrust laws).
 
  With respect to such liabilities, under agreements entered into at
divestiture, AT&T and the former Bell operating companies of AT&T (Bell
Companies) will share the costs of any judgment or other determination of
liability entered by a court or administrative agency, the costs of defending
the claim (including attorneys' fees and court costs) and the cost of interest
or penalties with respect to any such judgment or determination. Except to the
extent that affected parties may otherwise agree, the general rule is that
responsibility for such contingent
 
                                       14
<PAGE>
 
liabilities will be divided among AT&T and the Bell Companies on the basis of
their relative net investment (defined as total assets less reserves for
depreciation) as of the effective date of divestiture. Different allocation
rules apply to liabilities which relate exclusively to pre-divestiture
interstate or intrastate operations.
 
  In January 1995, Ameritech and the other RHCs agreed to terminate the
sharing arrangement among the Bell Companies with respect to pre-divestiture
contingent liabilities for certain matters. AT&T did not enter into the
agreement and, accordingly, the sharing arrangement remains in effect with
respect to AT&T's pre-divestiture liabilities and AT&T's share of Bell Company
pre-divestiture liabilities.
 
  Although complete assurance cannot be given as to the outcome of any
litigation, in the opinion of the Company's management, any monetary liability
or financial impact to which the Company would be subject after final
adjudication of all of the foregoing actions would not be material in amount
to the Company.
 
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
 
  No matter was submitted to a vote of security holders in the fourth quarter
of the fiscal year covered by this report.
 
            EXECUTIVE OFFICERS OF THE COMPANY (AS OF MARCH 1, 1996)
 
  The following table sets forth, as to the executive officers of Ameritech,
their ages, their offices with Ameritech and the period during which they have
held such offices.
<TABLE>
<CAPTION>
                                                                           HELD
NAME                          AGE                 OFFICER                  SINCE
----                          ---                 -------                  -----
<S>                           <C> <C>                                      <C>
Richard C. Notebaert*........  48 Chairman and Chief                       1994
                                   Executive Officer
W. Patrick Campbell..........  49 Executive Vice President--               1994
                                   Corporate Strategy and
                                   Business Development
Thomas P. Hester.............  58 Executive Vice President and             1991
                                   General Counsel
Oren G. Shaffer..............  53 Executive Vice President and             1994
                                   Chief Financial Officer
Barry K. Allen...............  47 Senior Vice President--                  1995
                                   Communications and Information Products
Timothy M. Connolly..........  47 Senior Vice President--                  1995
                                   Worldwide Network Systems
Walter M. Oliver.............  50 Senior Vice President--                  1994
                                   Human Resources
Rita P. Wilson...............  49 Senior Vice President--                  1994
                                   Corporate Communications
Walter S. Catlow.............  51 President--International Business        1995
                                   Development and Operations
Thomas J. Reiman.............  46 President--Product Management            1996
Betty F. Elliott.............  51 Vice President and Comptroller           1991
Joel S. Engel................  60 Vice President--Technology               1993
Gary R. Lytle................  52 Vice President--Federal Relations        1994
Sari L. Macrie...............  39 Vice President--Investor Relations       1994
Richard W. Pehlke............  42 Vice President and Treasurer             1994
Lawrence E. Strickling.......  44 Vice President--Public Policy            1993
Kelly R. Welsh...............  43 Vice President and Associate             1993
                                   General Counsel
Bruce B. Howat...............  51 Secretary                                1983
</TABLE>
--------
*Member of the Board of Directors and Chairman of the Executive Committee
 
                                      15
<PAGE>
 
  Prior to the most recent election to office with Ameritech, the above
officers held high-level managerial positions within Ameritech for more than
the past five years, except for Mr. Welsh, Mr. Campbell, Mr. Shaffer, Ms.
Wilson, Mr. Oliver, Mr. Allen and Mr. Connolly. Before joining Ameritech, Mr.
Welsh was Corporation Counsel of the City of Chicago from 1989 to 1993 and,
prior to that, was an attorney with Mayer, Brown and Platt, a Chicago-based
law firm. Mr. Campbell was President and Chief Executive Officer of Columbia
TriStar Home Video, a Sony Pictures Entertainment Company, from 1989 to 1994.
Previously, Mr. Campbell held a variety of management positions at Norelco,
SCM Corporation and McGraw Edison. Mr. Shaffer served as Chief Financial
Officer and President of Virgo Cap Inc., a private investment firm, from 1992
to 1994. Previously, Mr. Shaffer was Chief Financial Officer, Executive Vice
President and a member of the Board of Directors of The Goodyear Tire & Rubber
Co., from 1968 to 1992. Ms. Wilson was Senior Vice President--Corporate
Communications and a member of the Board of Directors of Allstate Insurance
Company from 1990 to 1994 after serving in various operations positions at
Allstate beginning in 1974. Mr. Allen started his career with Ameritech in
1974, serving as President of Wisconsin Bell from 1987 and President of
Illinois Bell in 1993. He left Ameritech in 1993 to become President and Chief
Operating Officer of Marquette Electronics, Inc. and served in this capacity
until July 1995, when he rejoined Ameritech as President of Ameritech's
enhanced business services unit. Mr. Connolly previously was an executive with
Bell Atlantic Corporation where he served as President of Sorbus, Inc., a unit
that provides computer maintenance services in the United States and in
international markets. From 1985 to 1988, he headed Bell Atlantic's cellular
and paging subsidiaries. In 1989, he became Executive Vice President and Chief
Operating Officer of the Kansas City Chiefs professional football club.
 
  Richard H. Brown, Vice Chairman, resigned effective August 4, 1995 to accept
the position of President and Chief Executive Officer of H&R Block, Inc.,
headquartered in Kansas City, Missouri.
 
  Officers are elected annually but may be removed at any time at the
discretion of the Board of Directors.
 
                                    PART II
 
ITEMS 5 THROUGH 8.
 
  There were 877,937 owners of record of Ameritech Common Stock as of December
31, 1995. Ameritech Common Stock is listed on the New York, Boston, Chicago,
Pacific, Philadelphia, London, Tokyo, Amsterdam, Basel, Geneva and Zurich
stock exchanges. The rest of the information required by these items is
included in the Financial section on pages 22 through 31, pages 33 through 48,
and on page 53 of the Company's annual report to security holders for the year
ended December 31, 1995. Such information is incorporated by reference
pursuant to General Instruction G(2).
 
ITEMS 7 AND 8. SUBSEQUENT EVENTS.
 
  On March 5, 1996, the Ohio Supreme Court released an opinion reversing the
order of the Public Utilities Commission of Ohio (PUCO) that approved the
Advantage Ohio alternative regulation plan and remanding the matter to the
Commission. The court ruled that the Commission exceeded its statutory
authority when it used alternative rate-setting methods to establish
Ameritech's basic local exchange service rates because of the procedure
followed by the Company and the Commission. Advantage Ohio, originally adopted
by the PUCO in November 1994, granted the Company relief from rate-of-return
regulation in Ohio and replaced such regulation with a price cap formula. The
Company implemented certain rate reductions beginning January 9, 1995 as a
result of Advantage Ohio and began making agreed upon grants to public schools
and making Company infrastructure enhancements. The outcome of the court's
opinion on alternative regulation and rates, and other aspects of the
Advantage Ohio plan, cannot be determined at this time.
 
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS AND ACCOUNTING AND
FINANCIAL DISCLOSURE.
 
  No disagreements with accountants on any matter of accounting principles or
practices, financial statement disclosure or auditing scope or procedure
occurred during the period covered by this annual report.
 
                                      16
<PAGE>
 
                                   PART III
 
ITEMS 10 THROUGH 13.
 
 
  Information regarding executive officers required by Item 401 of Regulation
S-K is furnished in a separate disclosure in Part I of this report since the
Company did not furnish such information in its definitive proxy statement
dated March 1, 1996, prepared in accordance with Schedule 14A.
 
  The other information required by these items is included in the Company's
definitive proxy statement on pages 2 through 4, in the section on Officer and
Director Stock Ownership on pages 5 and 6, in the section on Compensation of
Directors on page 6, and in the section on Executive Compensation on pages 10
through 19, and is incorporated herein by reference pursuant to General
Instruction G(3).
 
                                    PART IV
 
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.
 
  (A) Documents filed as a part of the report:
 
<TABLE>
<CAPTION>
                                                                          PAGES
                                                                          ------
<S>                                                                       <C>
(1) Financial Statements:
  Selected Financial and Operating Data..................................    *22
  Report of Independent Public Accountants...............................    *33
  Consolidated Statements of Income......................................    *34
  Consolidated Balance Sheets............................................    *35
  Consolidated Statements of Shareowners' Equity.........................    *36
  Consolidated Statements of Cash Flows..................................    *37
  Notes to Consolidated Financial Statements............................. *38-48
(2) Financial Statement Schedule:
  Report of Independent Public Accountants...............................     24
  II--Valuation and Qualifying Accounts..................................     25
</TABLE>
--------
  *Incorporated herein by reference to the appropriate portions of the
  Company's annual report to security holders for the year ended December 31,
  1995.
 
  Financial statement schedules other than the one listed above have been
omitted because the required information is contained in the financial
statements and notes thereto, or because such schedules are not required or
applicable. Separate financial statements of subsidiaries not consolidated and
50% or less owned persons are omitted since no such entity constitutes a
"significant subsidiary" pursuant to the provisions of Regulation S-X, Article
3-09.
    
                                      17
<PAGE>
 
  Exhibits identified in parentheses below, on file with the SEC, are
incorporated herein by reference as exhibits hereto.
 
<TABLE>
<CAPTION>
      EXHIBIT
      NUMBER
      -------
     <C>       <S>                                                          <C>
      3a       --Certificate of Incorporation of the Company as amended
                on April 26, 1991 (Exhibit 3a to Form 10-K for 1991, File
                No. 1-8612).
      3b       --By-Laws of the Company, as amended on April 15, 1992
                (Exhibit 3b to Form 10-K for 1992, File No. 1-8612).
      4b       --No instrument which defines the rights of holders of
                long and intermediate term debt of the Company and all of
                its consolidated subsidiaries is filed herewith pursuant
                to Regulation S-K, Item 601(b)(4)(iii)(A). Pursuant to
                this regulation, the Company hereby agrees to furnish a
                copy of any such instrument to the SEC upon request.
     10a       --Reorganization and Divestiture Agreement between Ameri-
                can Telephone and Telegraph Company and the Company and
                Affiliates, dated as of November 1, 1983 (Exhibit 10a to
                Form 10-K for 1983, File No. 1-8612).
     10b       --Agreement Concerning Contingent Liabilities, Tax Matters
                and Termination of Certain Agreements, among American
                Telephone and Telegraph Company, Bell System Operating
                Companies, Regional Holding Companies and Affiliates
                dated as of November 1, 1983 (Exhibit 10j to Form 10-K
                for 1983, File No. 1-8612).
     10c       --Ameritech Senior Management Short Term Incentive Plan as
                amended and restated effective as of January 1, 1992 (Ex-
                hibit 10aa to Form 10-K for 1991, File No. 1-8612).
     10d       --Ameritech Long Term Incentive Plan as amended and re-
                stated effective as of January 1, 1992 (Exhibit 10bb to
                Form 10-K for 1991, File No. 1-8612).
     10d-1     --First Amendment to Ameritech Long Term Incentive Plan
                (Exhibit 10bb-1 to Form 10-K for 1993, File No. 1-8612).
     10d-2     --Resolution concerning the exercisability of stock op-
                tions granted under the Ameritech Long Term Incentive
                Plan, approved on January 17, 1996.
     10e       --Ameritech Stock Retirement Plan for Non-Employee Direc-
                tors (Exhibit 10ll to Form 10-K for 1986, File No. 1-
                8612).
     10e-1     --First Amendment of Ameritech Stock Retirement Plan for
                Non-Employee Directors (Exhibit 10ll-1 to Form 10-K for
                1988, File No. 1-8612).
     10e-2     --Second Amendment of Amendment Ameritech Stock Retirement
                Plan for Non-Employee Directors (Exhibit 10ll-2 to Form
                10-K for 1989, File No. 1-8612).
     10f       --Ameritech Senior Management Life Insurance Plan Agree-
                ments (Exhibit 10cc to Form 10-K for 1990, File No. 1-
                8612).
     10g       --Ameritech Perquisite Program (Exhibit 10ff to Form 10-K
                for 1991, File No. 1-8612).
     10h       --Ameritech Deferred Compensation Plan for Non-Employee
                Directors (Exhibit 10gg to Form 10-K for 1985, File No.
                1-8612).
     10h-1     --First Amendment of Deferred Compensation Plan for Non-
                Employee Directors (Exhibit 10gg-1 to Form 10-K for 1986,
                File No. 1-8612).
</TABLE>
 
 
                                       18
<PAGE>
 
<TABLE>
<CAPTION>
      EXHIBIT
      NUMBER
      -------
     <C>       <S>                                                          <C>
     10h-2     --First Amendment of American Information Technologies
                Corporation Deferred Compensation Plan for Non-Employee
                Directors effective as of January 1, 1989 (Exhibit 10gg-2
                to Form 10-K for 1988, File No. 1-8612).
     10h-3     --Second Amendment of American Information Technologies
                Corporation Deferred Compensation Plan for Non-Employee
                Directors (Exhibit 10gg-3 to Form 10-K for 1990, File No.
                1-8612).
     10h-4     --Third Amendment of American Information Technologies
                Corporation Deferred Compensation Plan for Non-Employee
                Directors (Exhibit 10gg-4 to Form 10-K for 1990, File No.
                1-8612).
     10h-5     --Fourth Amendment of American Information Technologies
                Corporation Deferred Compensation Plan for Non-Employee
                Directors (Exhibit 10gg-5 to Form 10-K for 1992, File No.
                1-8612).
     10i       --Ameritech Plan for Non-Employee Directors' Travel Acci-
                dent Insurance (Exhibit 10hh to Registration Statement
                No. 2-87838).
     10j       --Ameritech Management Supplemental Pension Plan as
                amended through the Seventh Amendment (Exhibit 10ii to
                Form 10-K for 1991, File No. 1-8612).
     10j-1     --Eighth Amendment of Ameritech Management Supplemental
                Pension Plan (Exhibit 10ii-1 to Form 10-K for 1991, File
                No. 1-8612).
     10j-2     --Ninth Amendment of Ameritech Management Supplemental
                Pension Plan (Exhibit 10ii-2 to Form 10-K for 1991, File
                No. 1-8612).
     10j-3     --Tenth Amendment to Ameritech Management Supplemental
                Pension Plan (Exhibit 10ii-3 to Form 10-K for 1993, File
                No. 1-8612).
     10j-4     --Eleventh Amendment to Ameritech Management Supplemental
                Pension Plan (Exhibit 10ii-4 to Form 10-K for 1993, File
                No. 1-8612).
     10j-5     --Twelfth Amendment to Ameritech Management Supplemental
                Pension Plan (Exhibit 10ii-5 to Form 10-K for 1993, File
                No. 1-8612).
     10j-6     --Thirteenth Amendment to Ameritech Management Supplemen-
                tal Pension Plan (Exhibit 10j-6 to Form 10-K for 1994,
                File No. 1-8612).
     10k       --Ameritech 1989 Long Term Incentive Plan as amended and
                restated effective as of January 1, 1992 (Exhibit 10oo to
                Form 10-K for 1991, File No. 1-8612).
     10k-1     --First Amendment to 1989 Long Term Incentive Plan (Ex-
                hibit 10oo-1 to Form 10-K for 1993, File No. 1-8612).
     10k-2     --Resolution concerning the exercisability of stock op-
                tions granted under the Ameritech 1989 Long Term Incen-
                tive Plan, approved on January 17, 1996.
     10l       --Ameritech (Subsidiary) Senior Management Short Term In-
                centive Plan as amended and restated effective January 1,
                1992 (Exhibit 10pp to Form 10-K for 1991, File No. 1-
                8612).
     10m       --Ameritech Management Employees Benefit Protection Trust
                as amended through the First Amendment (Exhibit 10uu to
                Form 10-K for 1991, File No. 1-8612).
     10m-1     --Second Amendment to Ameritech Management Employees Bene-
                fit Protection Trust (Exhibit 10uu-1 to Form 10-K for
                1991, File No. 1-8612).
     10n       --Ameritech Senior Management Severance Pay Trust as
                amended through the First Amendment (Exhibit 10tt to Form
                10-K for 1991, File No. 1-8612).
</TABLE>
 
 
                                       19
<PAGE>
 
<TABLE>
<CAPTION>
      EXHIBIT
      NUMBER
      -------
     <C>       <S>                                                          <C>
     10n-1     --Second Amendment to Ameritech Senior Management Sever-
                ance Pay Trust (Exhibit 10tt-1 to Form 10-K for 1991,
                File No. 1-8612)
     10o       --Ameritech Mid-Career Pension Plan (Exhibit 10ff to Form
                10-K for 1994, File No. 1-8612).
     10o-1     --First Amendment to Ameritech Mid-Career Pension Plan
                (Exhibit 10ff-1 to Form 10-K for 1994, File No. 1-8612).
     10o-2     --Second Amendment to Ameritech Mid-Career Pension Plan
                (Exhibit 10ff-2 to Form 10-K for 1994, File No. 1-8612).
     10o-3     --Third Amendment to Ameritech Mid-Career Pension Plan
                (Exhibit 10ff-3 to Form 10-K for 1994, File No. 1-8612).
     10o-4     --Fourth Amendment to Ameritech Mid-Career Pension Plan
                (Exhibit 10ff-4 to Form 10-K for 1994, File No. 1-8612).
     10o-5     --Fifth Amendment to Ameritech Mid-Career Pension Plan
                (Exhibit 10ff-5 to Form 10-K for 1994, File No. 1-8612).
     10o-6     --Sixth Amendment to Ameritech Mid-Career Pension Plan
                (Exhibit 10ff-6 to Form 10-K for 1994, File No. 1-8612).
     10o-7     --Seventh Amendment to Ameritech Mid-Career Pension Plan
                (Exhibit 10ff-7 to Form 10-K for 1994, File No. 1-8612).
     10o-8     --Eighth Amendment to Ameritech Mid-Career Pension Plan
                (Exhibit 10ff-8 to Form 10-K for 1994, File No. 1-8612).
     10o-9     --Ninth Amendment to Ameritech Mid-Career Pension Plan.
     10p       --Agreement Regarding Change in Control dated as of Janu-
                ary 19, 1994 between the Company and Richard C.
                Notebaert, together with a schedule identifying other
                documents (Exhibit 10mm to Form 10-K for 1993, File No.
                1-8612).
     10q       --Agreement Regarding Change in Control dated as of Janu-
                ary 19, 1994 between the Company and Thomas P. Hester
                (Exhibit 10y to Form 10-K for 1994, File No 1-8612).
     10r       --Agreement Regarding Change in Control dated as of Sep-
                tember 9, 1994 between the Company and W. Patrick Camp-
                bell (Exhibit 10z to Form 10-K for 1994, File No. 1-
                8612).
     10s       --Agreement Regarding Change in Control dated as of Sep-
                tember 9, 1994 between the Company and Walter M. Oliver
                (Exhibit 10aa to Form 10-K for 1994, File No. 1-8612).
     10t       --Agreement Regarding Change in Control dated as of Janu-
                ary 1, 1995 between the Company and Oren G. Shaffer (Ex-
                hibit 10bb to Form 10-K for 1994, File No. 1-8612).
     10u       --Agreement Regarding Change in Control dated as of Janu-
                ary 1, 1995 between the Company and Rita P. Wilson (Ex-
                hibit 10cc to Form 10-K for 1994, File No. 1-8612).
     10v       --Agreement Regarding Change in Control dated as of Decem-
                ber 1, 1995 between the Company and Barry K. Allen.
     10w       --Agreement Regarding Change in Control dated as of Decem-
                ber 1, 1995 between the Company and Timothy M. Connolly.
     10x       --Ameritech Key Management Life Insurance Plan as amended
                and restated effective as of December 1, 1995.
</TABLE>
 
 
                                       20
<PAGE>
 
<TABLE>
<CAPTION>
      EXHIBIT
      NUMBER
      -------
     <C>       <S>                                                          <C>
     10y       --Ameritech Estate Preservation Plan as amended and re-
                stated effective as of December 1, 1995.
     10z       --Ameritech Corporate Resource Long Term Disability Plan
                as amended and restated effective as of December 1, 1995.
     10aa      --Ameritech Corporate Resource Transfer Program as amended
                and restated effective as of December 1, 1995.
     10bb      --Ameritech Corporate Resource Supplemental Pension Plan
                as amended and restated effective as of December 1, 1995.
     10cc      --Ameritech Corporate Resource Deferral Plan as amended
                and restated effective as of December 1, 1995.
     10dd      --Ameritech Corporate Resource Severance Pay Plan as
                amended and restated effective as of December 1, 1995.
     10ee      --Ameritech Management Committee Short Term Incentive
                Plan.
     10ff      --Ameritech Senior Management Retirement and Survivor Pro-
                tection Trust dated as of November 30, 1988.
     10ff-1    --First Amendment to Ameritech Senior Management Retire-
                ment and Survivor Protection Trust.
     10ff-2    --Second Amendment to Ameritech Senior Management Retire-
                ment and Survivor Protection Trust.
     10ff-3    --Third Amendment to Ameritech Senior Management Retire-
                ment and Survivor Protection Trust.
     11a       --Statement re: computation of primary earnings per share.
     11b       --Statement re: computation of fully diluted earnings per
                share.
     12        --Computation of ratio of earnings to fixed charges for
                the five years ended December 31, 1995.
     13        --Portions of Ameritech's annual report to security hold-
                ers for the year ended December 31, 1995.
     21        --Subsidiaries of the Company.
     23        --Consent of Arthur Andersen LLP.
     24        --Powers of Attorney.
     27        --Financial Data Schedule for the year ended December 31,
                1995.
     99a       --Form 11-K Annual Report for the fiscal year ended Decem-
                ber 31, 1995 of the Ameritech Savings Plan for Salaried
                Employees, to be filed by amendment.
     99b       --Form 11-K Annual Report for the fiscal year ended Decem-
                ber 31, 1995 of the Ameritech Savings and Security Plan
                (Non-Salaried Employees), to be filed by amendment.
     99c       --Form 11-K Annual Report for the fiscal year ended Decem-
                ber 31, 1995 of the DonTech Profit Participation Plan, to
                be filed by amendment.
</TABLE>
 
  Ameritech will furnish, without charge, to a security holder upon request a
copy of the annual report to security holders and the proxy statement,
portions of which are incorporated by reference, and will furnish any other
exhibit at cost.
 
 
                                      21
<PAGE>
 
(B) Reports on Form 8-K:
 
  On December 26, 1995, Ameritech filed a Current Report on Form 8-K, dated
December 14, 1995 to report on Item 5, Other Events, the Company's pending
investment in Belgacom S.A. and its increased investment in MATAV, the Belgian
and Hungarian telecommunications companies, respectively.
 
  On January 16, 1996, the Company filed another Current Report on Form 8-K,
dated January 16, 1996, to report on Item 7, Financial Statements and
Exhibits, Ameritech's earnings for the fourth quarter and year ended December
31, 1995.
 
                                      22
<PAGE>
 
                                   SIGNATURES
 
  PURSUANT TO THE REQUIREMENTS OF SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934, THE REGISTRANT HAS DULY CAUSED THIS REPORT TO BE SIGNED
ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED.
 
                                          Ameritech Corporation
 
                                                 /s/ Betty F. Elliott
                                          By __________________________________
                                                    (Betty F. Elliott,
                                              Vice President and Comptroller)
 
March 11, 1996
 
  PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1934, THIS REPORT HAS
BEEN SIGNED BELOW BY THE FOLLOWING PERSONS ON BEHALF OF THE REGISTRANT AND IN
THE CAPACITIES AND ON THE DATE INDICATED.
 
Principal Executive Officer:
R. C. Notebaert*
-------------------------------------
Chairman and Chief Executive Officer
 
Principal Financial Officer:
O. G. Shaffer*
-------------------------------------
      Executive Vice President
     and Chief Financial Officer
 
Principal Accounting Officer:                      /s/ Betty F. Elliott
B. F. Elliott                             *By _________________________________
-------------------------------------              (Betty F. Elliott,
   Vice President and Comptroller                  for herself and as
                                                    Attorney-in-Fact)
 
March 11, 1996
 
Directors:
D. C. Clark*
M. R. Goodes*
H. H. Gray*
J. A. Henderson*
S. B. Lubar*
L. M. Martin*
A. C. Martinez*
J. B. McCoy*
R. C. Notebaert*
J. D. Ong*
A. B. Rand*
J. A. Unruh*
 
                                       23
<PAGE>
 
                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
 
Board of Directors
Ameritech Corporation
 
  We have audited in accordance with generally accepted auditing standards the
financial statements included in Ameritech Corporation's annual report to
shareowners incorporated by reference in this Form 10-K, and have issued our
report thereon dated January 17, 1996. Our audits were made for the purpose of
forming an opinion on those statements taken as a whole. The financial
statement schedule listed in Item 14(a)(2) is the responsibility of the
Company's management and is presented for purposes of complying with the
Securities and Exchange Commission's rules and is not part of the basic
financial statements. This schedule has been subjected to the auditing
procedures applied in the audits of the basic financial statements and, in our
opinion, fairly states in all material respects the financial data required to
be set forth therein in relation to the basic financial statements taken as a
whole.
 
                                          Arthur Andersen LLP
 
Chicago, Illinois
January 17, 1996
 
                                       24
<PAGE>
 
                             AMERITECH CORPORATION
 
                SCHEDULE II--VALUATION AND QUALIFYING ACCOUNTS
                         ALLOWANCE FOR UNCOLLECTIBLES
                             (DOLLARS IN MILLIONS)
 
<TABLE>
<CAPTION>
COL. A               COL. B            COL. C              COL. D      COL. E
------             ---------- ------------------------ -------------- ---------
                                     ADDITIONS
                              ------------------------
                   BALANCE AT   CHARGED    CHARGED TO                  BALANCE
                   BEGINNING      TO         OTHER                    AT END OF
CLASSIFICATION     OF PERIOD  EXPENSE (A) ACCOUNTS (B) DEDUCTIONS (C)  PERIOD
--------------     ---------- ----------- ------------ -------------- ---------
<S>                <C>        <C>         <C>          <C>            <C>
Year 1995.........   $147.3     $205.2       $231.1        $417.4      $166.2
Year 1994.........    134.7      171.1        178.1         336.6       147.3
Year 1993.........    126.3      154.3        165.1         311.0       134.7
</TABLE>
--------
(a) Excludes direct charges and credits to expense on the statements of income
    and reinvested earnings related to interexchange carrier receivables.
(b) Includes principally amounts previously written off which were credited
    directly to this account when recovered and amounts related to long
    distance carrier receivables which are being billed by the Company.
(c) Amounts written off as uncollectible.
 
                                      25