UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549  FORM N-CSR  Investment Company Act file number
        811-3657
  DWS State Tax-Free Income Series (Exact Name of Registrant as Specified in Charter)  345 Park Avenue New York, NY 10154-0004 (Address of principal executive offices)             (Zip code)  Registrants Telephone Number, including Area Code:(212) 454-7190  Paul Schubert 345 Park Avenue New York, NY 10154-0004 (Name and Address of Agent for Service)  Date of fiscal year end:
        08/31
  Date of reporting period:
        08/31/08
   ITEM 1.REPORT TO STOCKHOLDERS   
 AUGUST 31, 2008
Annual Report
to ShareholdersDWS New York Tax-Free
Income Fundntf_cover350 Contents 4Performance Summary
10Information About Your Fund's Expenses
12Portfolio Management Review
18Portfolio Summary
19Investment Portfolio
25Financial Statements
30Financial Highlights
34Notes to Financial Statements
43Report of Independent Registered Public Accounting Firm
44Tax Information
45Shareholder Meeting Results
47Summary of Management Fee Evaluation by Independent
Fee Consultant
52Trustees and Officers
56Account Management Resources This report must be preceded or accompanied by a prospectus. To obtain a
prospectus for any of our funds, refer to the Account Management Resources
information provided in the back of this booklet. We advise you to consider the
fund's objectives, risks, charges and expenses carefully before investing. The
prospectus contains this and other important information about the fund. Please
read the prospectus carefully before you invest. Investments in mutual funds involve risk. Some funds have more risk than others. The
fund invests in individual bonds whose yields and market values fluctuate so that your
investment may be worth more or less than its original cost. Bond investments are
subject to interest rate risk such that when interest rates rise, the prices of bonds, and
thus the value of the fund, can decline and the investor can lose principal value.
Additionally, this fund is nondiversified and can take larger positions in fewer issuers,
increasing its overall potential risk. A portion of the fund's returns may be subject to
federal, state, local and alternative minimum tax. Please read this fund's prospectus for
specific details regarding its investments and risk profile. DWS Investments is part of Deutsche Bank's Asset Management division and, within the US,
represents the retail asset management activities of Deutsche Bank AG, Deutsche Bank Trust
Company Americas, Deutsche Investment Management Americas Inc. and DWS Trust
Company. NOT FDIC/NCUA INSURED NO BANK GUARANTEE MAY LOSE VALUE
NOT A DEPOSIT NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY Performance SummaryAugust 31, 2008 Classes A, B and C All performance shown is historical, assumes reinvestment of all dividend and
capital gain distributions, and does not guarantee future results. Investment return
and principal value fluctuate with changing market conditions so that, when
redeemed, shares may be worth more or less than their original cost. Current
performance may be lower or higher than the performance quoted. Please visit
www.dws-investments.com for the Fund's most recent month-end performance. The maximum sales charge for Class A shares is 4.5%. For Class B shares, the
maximum contingent deferred sales charge (CDSC) is 4% within the first year after
purchase, declining to 0% after six years. Class C shares have no front-end sales
charge but redemptions within one year of purchase may be subject to a CDSC of
1%. Unadjusted returns do not reflect sales charges and would have been lower if
they had. The total annual fund operating expense ratios, gross of any fee waivers or expense
reimbursements, as stated in the fee table of the prospectus dated December 1,
2007 are 1.10%, 1.96% and 1.92% for Class A, Class B and Class C shares,
respectively. Please see the Information About Your Fund's Expenses, the Financial
Highlights and Notes to the Financial Statements (Note C, Related Parties) sections
of this report for gross and net expense related disclosure for the period ended
August 31, 2008. To discourage short-term trading, the Fund imposes a 2% redemption fee on
shareholders redeeming shares held less than 15 days, which has the effect of
lowering total return. Returns and rankings during all periods shown reflect a fee waiver and/or expense
reimbursement. Without this waiver/reimbursement, returns and rankings would have
been lower. Performance figures do not reflect the deduction of taxes that a shareholder would pay on
fund distributions or the redemption of fund shares. Returns and rankings may differ by
share class. A portion of the Fund's distributions may be subject to federal, state and local tax and the
alternative minimum tax. Average Annual Total Returns(Unadjusted for Sales Charge) as of 8/31/08DWS New York Tax-FreeIncome Fund
1-Year
3-Year
5-Year
10-YearClass A
2.97%
2.60%
3.56%
4.06%Class B
2.10%
1.86%
2.83%
3.26%Class C
2.09%
1.83%
2.79%
3.26%Lehman Brothers Municipal Bond Index+
4.48%
3.27%
4.43%
4.87% Sources: Lipper Inc. and Deutsche Investment Management Americas Inc. Net Asset Value and Distribution InformationClass A
Class B
Class CNet Asset Value:
8/31/08
$     10.52
$     10.53
$     10.518/31/07
$     10.64
$     10.66
$     10.64Distribution Information:
Twelve Months as of 8/31/08:Income Dividends
$     .43
$     .35
$     .35August Income Dividend
$     .0364
$     .0298
$     .0297SEC 30-day Yield as of 8/31/08++
3.56%
2.99%
2.99%Tax Equivalent Yield as of 8/31/08++
5.88%
4.94%
4.94%Current Annualized Distribution Rate (based on
Net Asset Value) as of 8/31/08++
4.09%
3.34%
3.34% + + The SEC yield is net investment income per share earned over the month ended
August 31, 2008, shown as an annualized percentage of the maximum offering price per
share on the last day of the period. The SEC yield is computed in accordance with a
standardized method prescribed by the Securities and Exchange Commission. The SEC
yields would have been 3.54%, 2.88% and 2.90% for Class A, B and C shares,
respectively, had certain expenses not been reduced. Tax equivalent yield is based on the
Fund's yield and a marginal income tax rate of 39.45% (combined New York state and
federal income tax rate). Current annualized distribution rate is the latest monthly dividend
as an annualized percentage of net asset value on August 31, 2008. Distribution rate simply
measures the level of dividends and is not a complete measure of performance. The
current annualized distribution rate would have been 4.07%, 3.23% and 3.25% for Class A,
B and C shares, respectively, had certain expenses not been reduced. Yields and
distribution rates are historical, not guaranteed, and will fluctuate.  Class A Lipper Rankings  New York Municipal Debt Funds Categoryas of 8/31/08Period
Rank

Number of
Funds Tracked
Percentile
Ranking (%)1-Year
55
of
98
563-Year
27
of
93
295-Year
46
of
92
5010-Year
23
of
68
34 Source: Lipper Inc. Rankings are historical and do not guarantee future results. Rankings
are based on total return unadjusted for sales charges with distributions reinvested. If
sales charges had been included, results might have been less favorable. Rankings are for
Class A shares; other share classes may vary. Growth of an Assumed $10,000 Investment(Adjusted for Maximum Sales Charge)[]DWS New York Tax-Free Income Fund  Class A
[]Lehman Brothers Municipal Bond Index+ntf_g10k2ed0Yearly periods ended August 31 The Fund's growth of an assumed $10,000 investment is adjusted for the maximum sales
charge of 4.5%. This results in a net initial investment of $9,550. Comparative Results(Adjusted for Maximum Sales Charge) as of 8/31/08DWS New York Tax-Free Income Fund
1-Year
3-Year
5-Year
10-YearClass A
Growth of $10,000
$9,834
$10,314
$11,375
$14,214Average annual total return
-1.66%
1.04%
2.61%
3.58%Class B
Growth of $10,000
$9,914
$10,377
$11,401
$13,782Average annual total return
-.86%
1.24%
2.66%
3.26%Class C
Growth of $10,000
$10,209
$10,559
$11,475
$13,787Average annual total return
2.09%
1.83%
2.79%
3.26%Lehman Brothers
Municipal Bond Index+
Growth of $10,000
$10,448
$11,012
$12,421
$16,094Average annual total return
4.48%
3.27%
4.43%
4.87% The growth of $10,000 is cumulative. +  The Lehman Brothers Municipal Bond Index is an unmanaged, market value-weighted
measure of municipal bonds issued across the United States. Index issues have a credit
rating of at least Baa and a maturity of at least two years. Index returns, unlike Fund
returns, do not reflect any fees or expenses. It is not possible to invest directly into an
index. Barclays Capital completed an acquisition of Lehman Brothers' North American
Investment Banking and Capital Markets businesses. As part of the transaction, Lehman
Brothers indices have become part of Barclays Capital.  Class S Class S shares are generally not available to new investors except under certain
circumstances. (Please refer to the Fund's Statement of Additional Information.) All performance shown is historical, assumes reinvestment of all dividend and
capital gain distributions, and does not guarantee future results. Investment return
and principal value fluctuate with changing market conditions so that, when
redeemed, shares may be worth more or less than their original cost. Current
performance may be lower or higher than the performance quoted. Please visit
www.dws-investments.com for the Fund's most recent month-end performance. The total annual fund operating expense ratio, gross of any fee waivers or expense
reimbursements, as stated in the fee table of the prospectus dated December 1,
2007 is 0.96% for Class S shares. Please see the Information About Your Fund's
Expenses, the Financial Highlights and Notes to the Financial Statements (Note C,
Related Parties) sections of this report for gross and net expense related disclosure
for the period ended August 31, 2008. To discourage short-term trading, the Fund imposes a 2% redemption fee on
shareholders redeeming shares held less than 15 days, which has the effect of
lowering total return. Returns and rankings during all periods shown reflect a fee waiver and/or expense
reimbursement. Without this waiver/reimbursement, returns and rankings would have
been lower. Performance figures do not reflect the deduction of taxes that a shareholder would pay on
fund distributions or the redemption of fund shares. Returns and rankings may differ by
share class. A portion of the Fund's distributions may be subject to federal, state and local tax and the
alternative minimum tax. Average Annual Total Returnsas of 8/31/08DWS New York Tax-Free Income Fund
1-Year
3-Year
5-Year
Life of
Class*Class S
3.13%
2.81%
3.76%
4.19%Lehman Brothers Municipal Bond Index+
4.48%
3.27%
4.43%
4.85% Sources: Lipper Inc. and Deutsche Investment Management Americas Inc. * Class S shares commenced operations on June 18, 2001. Index returns began on
June 30, 2001.  Net Asset Value and Distribution InformationClass SNet Asset Value:
8/31/08
$     10.518/31/07
$     10.64Distribution Information:
Twelve Months as of 8/31/08:Income Dividends
$     .46August Income Dividend
$     .0386SEC 30-day Yield as of 8/31/08++
3.99%Tax Equivalent Yield as of 8/31/08++
6.59%Current Annualized Distribution Rate (based on Net Asset Value) as of 8/31/08++
4.34% + + The SEC yield is net investment income per share earned over the month ended
August 31, 2008, shown as an annualized percentage of the maximum offering price per
share on the last day of the period. The SEC yield is computed in accordance with a
standardized method prescribed by the Securities and Exchange Commission. The SEC
yield would have been 3.85% for Class S had certain expenses not been reduced. Tax
equivalent yield is based on the Fund's yield and a marginal income tax rate of 39.45%
(combined New York state and federal income tax rate). Current annualized distribution rate
is the latest monthly dividend as an annualized percentage of net asset value on August 31,
2008. In addition, the current annualized distribution rate would have been 4.20% for Class
S had certain expenses not been reduced. Distribution rate simply measures the level of
dividends and is not a complete measure of performance. Yields and distribution rates are
historical, not guaranteed, and will fluctuate.  Class S Lipper Rankings  New York Municipal Debt Funds Categoryas of
8/31/08Period
Rank

Number of
Funds Tracked
Percentile
Ranking (%)1-Year
46
of
98
473-Year
19
of
93
215-Year
31
of
92
34 Source: Lipper Inc. Rankings are historical and do not guarantee future results. Rankings
are based on total return with distributions reinvested. Rankings are for Class S shares;
other share classes may vary. Growth of an Assumed $10,000 Investment[]DWS New York Tax-Free Income Fund  Class S
[]Lehman Brothers Municipal Bond Index+ntf_g10k2c0Yearly periods ended August 31 Comparative Resultsas of 8/31/08DWS New York Tax-Free Income Fund
1-Year
3-Year
5-Year
Life of
Class*Class S
Growth of $10,000
$10,313
$10,868
$12,029
$13,446Average annual total return
3.13%
2.81%
3.76%
4.19%Lehman Brothers
Municipal Bond Index+
Growth of $10,000
$10,448
$11,012
$12,421
$14,040Average annual total return
4.48%
3.27%
4.43%
4.85% The growth of $10,000 is cumulative. * Class S shares commenced operations on June 18, 2001. Index returns began on
June 30, 2001.  +  The Lehman Brothers Municipal Bond Index is an unmanaged, market value-weighted
measure of municipal bonds issued across the United States. Index issues have a credit
rating of at least Baa and a maturity of at least two years. Index returns, unlike Fund
returns, do not reflect any fees or expenses. It is not possible to invest directly into an
index. Barclays Capital completed an acquisition of Lehman Brothers' North American
Investment Banking and Capital Markets businesses. As part of the transaction, Lehman
Brothers indices have become part of Barclays Capital.  Information About Your Fund's Expenses As an investor of the Fund, you incur two types of costs: ongoing expenses
and transaction costs. Ongoing expenses include management fees,
distribution and service (12b-1) fees and other Fund expenses. Examples of
transaction costs include sales charges (loads), redemption fees and
account maintenance fees, which are not shown in this section. The
following tables are intended to help you understand your ongoing expenses
(in dollars) of investing in the Fund and to help you compare these expenses
with the ongoing expenses of investing in other mutual funds. In the most
recent six-month period, the Fund limited these expenses; had it not done
so, expenses would have been higher. The example in the table is based on
an investment of $1,000 invested at the beginning of the six-month period
and held for the entire period(March 1, 2008 to August 31, 2008). The tables illustrate your Fund's expenses in two ways: •   Actual Fund Return. This helps you estimate the actual dollar amount of
ongoing expenses (but not transaction costs) paid on a $1,000
investment in the Fund using the Fund's actual return during the period.
To estimate the expenses you paid over the period, simply divide your
account value by $1,000 (for example, an $8,600 account value divided
by $1,000 = 8.6), then multiply the result by the number in the
"Expenses Paid per $1,000" line under the share class you hold. •   Hypothetical 5% Fund Return. This helps you to compare your Fund's
ongoing expenses (but not transaction costs) with those of other mutual
funds using the Fund's actual expense ratio and a hypothetical rate of
return of 5% per year before expenses. Examples using a 5%
hypothetical fund return may be found in the shareholder reports of other
mutual funds. The hypothetical account values and expenses may not be
used to estimate the actual ending account balance or expenses you
paid for the period. Please note that the expenses shown in these tables are meant to highlight
your ongoing expenses only and do not reflect any transaction costs. The
"Expenses Paid per $1,000" line of the tables is useful in comparing
ongoing expenses only and will not help you determine the relative total
expense of owning different funds. An account maintenance fee of $6.25
per quarter for Class S shares may apply for certain accounts whose
balances do not meet the applicable minimum initial investment. This fee is
not included in these tables. If it was, the estimate of expenses paid for
Class S shares during the period would be higher, and account value during
the period would be lower, by this amount. Expenses and Value of a $1,000 Investment (including interest expense)*for the six months ended August 31, 2008Actual Fund Return
Class A
Class B
Class C
Class SBeginning Account Value 3/1/08
$       1,000.00
$       1,000.00
$       1,000.00
$       1,000.00Ending Account Value 8/31/08
$       1,047.80
$       1,042.90
$       1,042.90
$       1,048.20Expenses Paid per $1,000**
$       6.38
$       10.22
$       10.22
$       5.10Hypothetical 5% Fund Return
Class A
Class B
Class C
Class SBeginning Account Value 3/1/08
$       1,000.00
$       1,000.00
$       1,000.00
$       1,000.00Ending Account Value 8/31/08
$       1,018.90
$       1,015.13
$       1,015.13
$       1,020.16Expenses Paid per $1,000**
$       6.29
$       10.08
$       10.08
$       5.03 Annualized Expense Ratios
Class A
Class B
Class C
Class SDWS New York Tax-Free Income Fund
1.24%
1.99%
1.99%
.99% Expenses and Value of a $1,000 Investment (excluding interest expense)*for the six months ended August 31, 2008Actual Fund Return
Class A
Class B
Class C
Class SBeginning Account Value 3/1/08
$       1,000.00
$       1,000.00
$       1,000.00
$       1,000.00Ending Account Value 8/31/08
$       1,047.80
$       1,042.90
$       1,042.90
$       1,048.20Expenses Paid per $1,000**
$       4.43
$       8.27
$       8.27
$       3.14Hypothetical 5% Fund Return
Class A
Class B
Class C
Class SBeginning Account Value 3/1/08
$       1,000.00
$       1,000.00
$       1,000.00
$       1,000.00Ending Account Value 8/31/08
$       1,020.81
$       1,017.04
$       1,017.04
$       1,022.07Expenses Paid per $1,000**
$       4.37
$       8.16
$       8.16
$       3.10 * Interest expense represents interest and fees on floating rate notes issued in conjunction
with inverse floating rate securities. Interest income from such transactions is included in
income from investment operations.  ** Expenses are equal to the Fund's annualized expense ratio for each share class, multiplied
by the average account value over the period, multiplied by the number of days in the most
recent six-month period, then divided by 366.  Annualized Expense Ratios
Class A
Class B
Class C
Class SDWS New York Tax-Free Income Fund
.86%
1.61%
1.61%
.61% For more information, please refer to the Fund's prospectus. Portfolio Management Review DWS New York Tax-Free Income Fund: A Team Approach to Investing Deutsche Investment Management Americas Inc. ("DIMA" or the
"Advisor"), which is part of Deutsche Asset Management, is the investment
advisor for DWS New York Tax-Free Income Fund. DIMA and its
predecessors have more than 80 years of experience managing mutual
funds and DIMA provides a full range of investment advisory services to
institutional and retail clients. Deutsche Asset Management is a global asset management organization
that offers a wide range of investing expertise and resources. This
well-resourced global investment platform brings together a wide variety of
experience and investment insight across industries, regions, asset classes
and investing styles. DIMA is an indirect, wholly owned subsidiary of Deutsche Bank AG.
Deutsche Bank AG is a major global banking institution that is engaged in a
wide range of financial services, including investment management, mutual
funds, retail, private and commercial banking, investment banking and
insurance. Portfolio Management Team Philip G. Condon Managing Director of Deutsche Asset Management and Co-Lead Portfolio Manager of the
fund. • Joined Deutsche Asset Management in 1983 and the fund in 2000. • Over 31 years of investment industry experience. • BA and MBA, University of Massachusetts at Amherst. Ashton P. Goodfield, CFA Managing Director of Deutsche Asset Management and Co-Lead Portfolio Manager of the
fund. • Joined Deutsche Asset Management in 1986 and the fund in 1999. • Over 21 years of investment industry experience. • BA, Duke University. Matthew J. Caggiano, CFA Director of Deutsche Asset Management and Portfolio Manager of the fund. • Joined Deutsche Asset Management in 1989 and the fund in 2004. • Over 16 years of investment industry experience. • BS, Pennsylvania State University; MS, Boston College. In the following interview, the portfolio management team discusses
DWS New York Tax-Free Income Fund's performance for the 12-month
period and the market environment for municipal bonds. The views expressed in the following discussion reflect those of the portfolio management
team only through the end of the period of the report as stated on the cover. The management
team's views are subject to change at any time based on market and other conditions and
should not be construed as a recommendation. Past performance is no guarantee of future
results. Q: Can you characterize conditions in the municipal bond market
during the annual period ended August 31, 2008? A:Over the full period, municipal bonds provided positive results,
while modestly underperforming their taxable counterparts. The
municipal bond market, as measured by the Lehman Brothers
Municipal Bond Index, returned 4.48% for the 12-month period
ended August 31, 2008.1 This compared to a positive 5.86% return
for the broad taxable bond market for the same period, as measured
by the Lehman Brothers U.S. Aggregate Index.2 Of course, past
performance is no guarantee of future results. 1 The unmanaged Lehman Brothers Municipal Bond Index is a market-value-weighted
measure of municipal bonds issued across the United States. Index issues have a credit
rating of at least Baa and a maturity of at least two years.  2 The Lehman Brothers U.S. Aggregate Index is an unmanaged index representing domestic
taxable investment-grade bonds, with index components for government and corporate
securities, mortgage pass-through securities and asset-backed securities with average
maturities of one year or more.   Barclays Capital completed an acquisition of Lehman Brothers' North American Investment
Banking and Capital Markets businesses. As part of the transaction, Lehman Brothers
indices have become part of Barclays Capital.  Index returns, unlike fund returns, do not reflect any fees or expenses. It is not possible to
invest directly into an index.  The relationship between supply of and demand for municipal
issues can be an important factor in the performance of this market.
High demand or low supply can drive municipal bond prices higher,
while low demand or high supply can have the reverse effect.
Supply was robust early in the period, but trailed off mid-period in
the wake of concerns over the credit status of leading bond
insurers. Over the latter part of the period, supply spiked upward
dramatically, driven by the conversion of auction-rate issues to
fixed-rate structures. On the demand side, retail interest in individual
bonds was strong, and flows into tax-free mutual funds were
generally positive. Support from insurance companies was in line
with historical levels. Demand was undercut by decreased support
from broker dealers and the unwinding of positions by institutional
investors who had been using leveraging and hedging strategies in
an attempt to benefit from disparities between the tax-free and
taxable markets. These factors contributed to a significant
dislocation between municipal supply and demand that at times
resulted in a severe decline in market liquidity. The US Federal Reserve Board (the Fed) responded to the liquidity
crisis in all of the credit markets by dropping the federal funds rate
 the overnight interbank lending rate and a benchmark for interest
rates generally  seven times over the 12-month period. As a
result, the federal funds rate declined from 5.25% to 2.00%. During
the period, yields on short- and intermediate-term municipals fell
significantly, while yields on longer-term issues ended the period
somewhat higher. Since a bond's yield moves in the opposite
direction of its price, this meant that intermediate-term municipal
bonds generally provided the best returns. The overall result of a decline in short-term yields and an increase in
long-term yields was a steepening of the tax-free yield curve over
the period.3 On the municipal bond curve, yields on two-year issues
fell by 156 basis points while bonds with 30-year maturities
experienced a yield increase of 9 basis points, resulting in a total
steepening of 165 basis points. (100 basis points equals one
percentage point. See the accompanying graph for a depiction of
municipal bond yield changes between the beginning and end of the
period.) 3 The yield curve is a graph with a left-to-right line that shows how high or low yields are,
from the shortest to the longest maturities. Typically (and when the yield curve is
characterized as "steep," this is especially true) the line rises from left to right as investors
who are willing to tie up their money for a longer period are rewarded with higher yields.  Municipal Bond Yield Curve(as of 8/31/07 and 8/31/08)ntf_yield250 Source: Municipal Market Data as of August 31, 2008. For illustrative purposes only; not meant
to represent the performance of any DWS product. With respect to credit quality, conditions in the municipal market
have shown signs of deteriorating in a weakening economy. In
addition, many insured issues, which have historically made up
about half of the municipal market, have been trading on the basis
of the creditworthiness of the underlying issuer, leading to
additional spread widening. During the period, leading insurers
MBIA and AMBAC both lost their AAA ratings and FGIC was
downgraded to junk status by Moody's Investors Services, Inc. and
Standard & Poor's Corporation (S&P).4 In some cases, insured
issues have actually experienced additional weakness as buyers
avoid "headline risk."5 In addition, the proportion of new issues with
insurance has been halved in recent months. The net result has
been an increase in non-AAA product and spread widening. Among
high-yield issues, spread widening was dramatic on tobacco- and,
especially, airline-related bonds. 4 Credit quality is a measure of a bond issuer's ability to repay interest and principal in a
timely manner. Rating agencies assign letter designations such as AAA, AA, and so forth.
The lower the rating, the higher the probability of default. The ratings of Moody's Investors
Service, Inc. (Moody's) and Standard & Poor's Corporation (S&P) represent these
companies' opinions as to the quality of the securities they rate. Ratings are relative and
subjective and are not absolute standards of quality. The fund's credit quality does not
remove market risk.  5 Headline risk is the possibility a negative news story will spread to other media outlets and
cause a significant change in the value of an investment. For example, an unconfirmed
report of a corporate management shakeup might be picked up by competing newspapers
and television networks, thus causing a sharp decline in the company's stock price. The
firm's stock price is likely to be subject to substantial volatility even though the story
eventually proves false.  The bond market's continued flight to quality resulted in lower yields
for Treasury bonds and historically high municipal yields relative to
Treasuries. In fact, at the end of August, municipals were yielding
almost as much, and in some cases, more than Treasuries, even
before taking into account the tax advantage of municipals. For
example, 30-year and 10-year AAA municipals were yielding 106.6%
and 94.5%, respectively, of comparable Treasury issues, before
taking into account the tax advantage of municipals. Q: How did DWS New York Tax-Free Income Fund perform for the
annual period ended August 31, 2008? A:DWS New York Tax-Free Income Fund's Class A shares posted a
return for the period of 2.97% (Returns are unadjusted for sales
charges. If sales charges had been included, returns would have
been lower. Past performance is no guarantee of future results.
Please see pages 4 through 9 for the performance of other share
classes and more complete performance information.) This return
compares to 4.48% for the fund's benchmark, the Lehman Brothers
Municipal Bond Index. The fund outperformed the 2.47% average of
its peer group, the Lipper New York Municipal Debt Funds
category.6 (Please see pages 4 through 9 for the performance of
other share classes and more complete performance information.) 6 The Lipper New York Municipal Debt Funds category is comprised of funds that limit their
assets to those securities that are exempt from taxation in New York City and state. Lipper
figures represent the average of the total returns reported by all of the mutual funds
designated by Lipper Inc. as falling into the Lipper New York Municipal Debt Funds
category. It is not possible to invest in a Lipper category. This category average was 2.47%
(98), 3.57% (92) and 3.83% (68) for the 1-, 5- and 10-year periods, respectively, as of
8/31/08.  Q: How was the fund positioned and how did this positioning
impact performance over the period? A:We do not attempt to predict the direction of interest rates, and
instead seek to maintain a neutral duration and corresponding
sensitivity to interest-rate changes. While we attempt to maintain a
neutral interest-rate posture overall, within this framework we will
make judgments about which maturities present the most attractive
opportunities. Along these lines, for much of the period we
minimized exposure to long-term bonds, as we did not believe they
provided a favorable risk/reward profile. Given a relatively flat yield
curve, we did not view the modest income advantage offered by
long-term issues as attractive. Our maturity positioning helped
performance over the period as the curve steepened dramatically,
driven by both falling short-term yields and rising yields (and falling
prices) on longer-term issues. Given the recent steepening, we have
increasingly been looking for opportunities to move out on the curve
to take advantage of the improved yield differentials available. Our low exposure to tobacco settlement and airline bonds helped
performance. As lower-quality issues have become more attractive
relative to higher-quality issues, we have used intensive credit
analysis to selectively increase exposure to this segment. This shift
has constrained performance to a degree as credit spreads have so
far continued to widen. It is important to note, however, that the
reduction of AAA-rated bonds represented in the fund's portfolio is
primarily the result of downgrades experienced by leading bond
insurers, rather than any shift in fund strategy. We hedged a portion of the fund's assets against interest-rate
changes using LIBOR (London Interbank Offered Rate, a benchmark
for taxable interest rates), and this held back performance as
municipals underperformed the taxable market. We also had
exposure to floating-rate notes with three-month resets tied to
LIBOR, which constrained performance over the period. Q: What is your current assessment of the New York municipal
bond market? A:The state's bonds continue to be rated AA by S&P and Aa3 by
Moody's. The financial industry, a major driver of the state's
economy and revenues, has seen its profitability impacted by recent
market conditions, and revenues to the state have declined as a
result. However, conservative budget management in recent years
allowed the state to benefit from economic strength by building its
reserves. In addition, the governor and legislature recently reopened
the state's budget for the current fiscal year in order to find $1
billion in savings, which should help the state to avoid significantly
drawing down its reserves. While New York has a relatively high per
capita debt burden, the state continues to have a large and broadly
diversified economic base. These positive economic and fiscal
trends have resulted in stable ratings of New York's general
obligation debt, which is backed by the full taxing power of the
state. In addition, New York City continues to be rated at its highest
levels ever by both Standard & Poor's and Moody's, AA and Aa3,
respectively. We believe that the outlook for the state's economy
and overall fiscal health remains stable. Portfolio Summary Asset Allocation(As a % of Investment Portfolio)
8/31/08
8/31/07Revenue Bonds
78%
71%General Obligation Bonds
16%
16%US Government Secured
6%
13%100%
100% Quality
8/31/08
8/31/07AAA
24%
67%AA
35%
16%A
21%
7%BBB
9%
2%BB
4%
2%B
1%
1%Not Rated
6%
5%100%
100% Effective Maturity
8/31/08
8/31/07Less than 1 year
7%
5%1-4.99 years
30%
27%5-9.99 years
47%
56%10-14.99 years
7%
7%15+ years
9%
5%100%
100% Interest Rate Sensitivity
8/31/08
8/31/07Duration
6.4 years
6.6 years Weighted average effective maturity: 7.4 years and 7.3 years, respectively. Asset allocation, quality, effective maturity and interest rate sensitivity are subject to change. The quality ratings represent the lower of Moody's Investors Service, Inc. ("Moody's") or
Standard & Poor's Corporation ("S&P") credit ratings. The ratings of Moody's and S&P
represent their opinions as to the quality of the securities they rate. Ratings are relative and
subjective and are not absolute standards of quality. The Fund's credit quality does not remove
market risk. For more complete details about the Fund's investment portfolio, see page 19. A quarterly Fact
Sheet is available upon request. A complete list of the fund's portfolio holdings is posted as of
the month end on www.dws-investments.com on or about the 15th day of the following
month. More frequent posting of portfolio holdings information may be made from time to time
on www.dws-investments.com. Please see the Account Management Resources section for
contact information. Following the Fund's fiscal first and third quarter-end, a complete portfolio
holdings listing is filed with the SEC on Form N-Q. The form will be available
on the SEC's Web site at www.sec.gov, and it also may be reviewed and
copied at the SEC's Public Reference Room in Washington, D.C. Information
on the operation of the SEC's Public Reference Room may be obtained by
calling (800) SEC-0330. Investment Portfolioas of August 31, 2008 Principal
Amount ($)
Value ($)Municipal Bonds and Notes 93.2%New York 81.5%Albany, NY, Industrial Development Agency, Civic Facility
Revenue, St. Peter's Hospital Project, Series A:5.25%, 11/15/2027
1,000,000
960,2915.75%, 11/15/2022
1,000,000
1,025,120Brookhaven, NY, Hospital & Healthcare Revenue, Industrial
Development Authority, Memorial Hospital Medical Center,
Series A, Prerefunded, 8.25%, 11/15/2030
2,000,000
2,260,520Buffalo, NY, Core City General Obligation, Series A,
5.375%, 2/1/2016 (a)
1,020,000
1,070,480Buffalo, NY, Other General Obligation, School Improvement,
Series D, 5.5%, 12/15/2015 (a)
1,000,000
1,073,490Chautauqua County, NY, County General Obligation, ETM,
7.3%, 4/1/2009 (a)
575,000
594,067Erie County, NY, County General Obligation, Public
Improvement, 6.125%, 1/15/2012 (a)
590,000
644,298Erie County, NY, Public Improvements, Series A,
5.0%, 12/1/2017 (a)
2,615,000
2,786,596Haverstraw-Stony Point, NY, Central School District,
5.0%, 10/15/2021 (a)
4,500,000
4,813,380Liberty, NY, Development Corp. Revenue, Goldman
Sachs Headquarters:5.25%, 10/1/2035
5,000,000
5,065,0505.5%, 10/1/2037
2,500,000
2,623,300Long Island, NY, Electric System Revenue, Power Authority:Zero Coupon, 6/1/2012 (a)
10,000,000
8,891,500Zero Coupon, 6/1/2014 (a)
2,115,000
1,727,722Series 1B, 2.3%*, 5/1/2033, State Street Bank & Trust Co.
(b)
1,900,000
1,900,000Series D, 5.0%, 9/1/2023 (a)
5,000,000
5,099,100Metropolitan Transportation Authority, NY, Revenue, Series A,
5.0%, 11/15/2022 (a)
1,575,000
1,670,335Monroe County, NY, General Obligation, Public Improvement:6.0%, 3/1/2013 (a)
1,050,000
1,187,6876.0%, 3/1/2014 (a)
1,040,000
1,191,9656.0%, 3/1/2015 (a)
1,250,000
1,450,6626.0%, 3/1/2017 (a)
1,410,000
1,668,5236.0%, 3/1/2018 (a)
1,130,000
1,344,067Nassau County, NY, Industrial Development Agency,
Continuing Care Retirement, Amsterdam At Harborside,
Series A, 6.5%, 1/1/2027
1,750,000
1,735,930Nassau County, NY, Sewer & Storm Water Finance Authority
System Revenue, Series B, 5.0%, 10/1/2023 (a)
500,000
511,295New York, Higher Education Revenue, Dormitory Authority:Series C, Prerefunded, 7.375%, 5/15/2010
215,000
223,669Series C, 7.375%, 5/15/2010
230,000
248,566Series B, Prerefunded, 7.5%, 5/15/2011
325,000
345,716Series B, 7.5%, 5/15/2011
295,000
329,887New York, Higher Education Revenue, Dormitory Authority,
Colgate University:6.0%, 7/1/2016 (a)
900,000
1,011,6726.0%, 7/1/2021 (a)
850,000
978,648New York, Higher Education Revenue, Dormitory Authority,
Green Chimneys School, Series A, 5.5%, 7/1/2018 (a)
1,375,000
1,421,227New York, Higher Education Revenue, Dormitory Authority,
New York University, Series A, 5.75%, 7/1/2027 (a) (c)
3,000,000
3,423,180New York, Higher Education Revenue, Dormitory Authority,
Pace University:6.5%, 7/1/2009 (a)
5,000
5,1476.5%, 7/1/2011 (a)
760,000
821,7276.5%, 7/1/2012 (a)
500,000
550,300New York, Higher Education Revenue, Urban
Development Corp., Syracuse University, Center for Science
and Technology:5.5%, 1/1/2015
4,500,000
4,913,3255.5%, 1/1/2017
4,890,000
5,418,658New York, Hospital & Healthcare Revenue, Dormitory
Authority, Mt. Sinai School of Medicine, Series B,
5.7%, 7/1/2011 (a)
1,075,000
1,117,054New York, Hospital & Healthcare Revenue, Dormitory
Authority, Sloan Kettering Institute, Series C, 5.5%, 7/1/2023
(a)
3,000,000
3,204,390New York, Housing Finance Agency, State University
Construction, Series A, ETM, 8.0%, 5/1/2011
140,000
151,169New York, Metropolitan Transportation Authority Revenue,
Series E-2, 1.8%*, 11/1/2035, Fortis Bank SA (b)
550,000
550,000New York, Sales & Special Tax Revenue, Local Government
Assistance Corp.:Series E, 5.25%, 4/1/2016 (a)
1,185,000
1,301,497Series C, 5.5%, 4/1/2017
6,000,000
6,768,960New York, Sales & Special Tax Revenue, Metropolitan
Transportation Authority, Series A, Prerefunded,
5.25%, 4/1/2016 (a)
2,000,000
2,251,640New York, Sales Tax Asset Receivable Corp.:Series A, 5.0%, 10/15/2026 (a)
5,000,000
5,170,200Series A, 5.0%, 10/15/2029 (a)
5,000,000
5,116,200New York, Seneca Nation Indians, Capital Improvements
Authority Revenue, Special Obligation, Series A, 144A,
5.25%, 12/1/2016
2,500,000
2,395,550New York, State Agency General Obligation Lease, Dormitory
Authority, City University System:Series A, 5.625%, 7/1/2016 (a)
1,100,000
1,225,697Series A, 5.75%, 7/1/2009 (a)
440,000
450,815Series A, 5.75%, 7/1/2013 (a)
4,100,000
4,420,4155.75%, 7/1/2018 (a)
2,250,000
2,561,062New York, State Agency Revenue Lease, Urban Development
Corp., Correctional Facilities, Series A, 5.5%, 1/1/2014 (a)
2,000,000
2,168,620New York, State Dormitory Authority Revenue, Series A-1,
5.0%, 8/15/2025 (a)
2,175,000
2,232,420New York, State Dormitory Authority Revenue, Mental Health
Services Facilities Improvement, Series D, 5.0%, 8/15/2018
(a)
3,120,000
3,303,144New York, State Dormitory Authority Revenue, Montefiore
Hospital, 5.0%, 8/1/2023 (a)
3,000,000
2,999,880New York, State Dormitory Authority Revenue, New York
University, Series A, 5.0%, 7/1/2022 (a)
2,000,000
2,067,720New York, State Dormitory Authority Revenue, Non-State
Supported Debt, NYU Hospital Center, Series B,
5.25%, 7/1/2024
1,000,000
973,200New York, State Dormitory Authority Revenue, Non-State
Supported Debt, Orange Regional Medical Center, 6.125%,
12/1/2029
3,000,000
2,930,370New York, State Dormitory Authority Revenue, State Personal
Income Tax, Series A, 5.0%, 3/15/2021
5,000,000
5,306,000New York, State General Obligation Lease, Dormitory
Authority, City University System:Series A, 5.75%, 7/1/2018 (a)
2,000,000
2,240,420Series D, ETM, 7.0%, 7/1/2009
325,000
337,438New York, State General Obligation Lease, Dormitory
Authority, Judicial Facilities, ETM, 7.375%, 7/1/2016 (a)
80,000
93,507New York, State General Obligation Lease, Dormitory
Authority, State University Educational Facilities,
5.875%, 5/15/2017 (a)
2,325,000
2,623,135New York, State General Obligation Lease, Urban Development
Corp., State Facilities, 5.6%, 4/1/2015
2,260,000
2,510,770New York, State General Obligation, Tobacco Settlement
Financing Corp., Series A-1, 5.5%, 6/1/2019
6,000,000
6,364,500New York, State Housing Finance Agency, State Personal
Income Tax Revenue, Economic Development & Housing,
Series A, 5.0%, 9/15/2030 (a)
4,000,000
4,053,360New York, State Thruway Authority Highway & Bridge Trust
Fund, Series B, 5.0%, 4/1/2021 (a)
10,000,000
10,504,500New York, State Urban Development Corp. Revenue, Personal
Income Tax:Series A-1, 5.0%, 12/15/2021 (a)
5,000,000
5,262,600Series B, 5.0%, 3/15/2023
45,000
47,396New York, Tobacco Settlement Financing Corp., Series B-1C,
5.5%, 6/1/2019
5,000,000
5,303,750New York, Transportation/Tolls Revenue, General
Improvements, Triborough Bridge and Tunnel Authority
Revenue, Series B, 5.0%, 11/15/2021
6,000,000
6,241,140New York, Transportation/Tolls Revenue, Metropolitan
Transportation Authority, Series C, Prerefunded,
5.125%, 7/1/2013 (a) (c)
4,000,000
4,376,469New York, Transportation/Tolls Revenue, Triborough Bridge and
Tunnel Authority, Series Y, ETM, 6.125%, 1/1/2021
7,205,000
8,671,650New York, Water & Sewer Revenue, Environmental Facilities
Corp., Riverbank State Park, 6.25%, 4/1/2012 (a)
3,695,000
3,954,906New York, Water & Sewer Revenue, Environmental Facilities
Corp., State Clean Water & Drinking Revolving Funds, Series
C, 5.25%, 6/15/2015
5,330,000
5,680,181New York, Water & Sewer Revenue, Environmental Facilities
Corp., State Water Pollution Control, Series E, 6.5%,
6/15/2014
90,000
90,329New York & New Jersey, Port Authority, Series 2232, AMT,
144A, 2.49%*, 4/15/2015 (a)
8,995,000
8,995,000New York & New Jersey, Port Authority, One Hundred
Forty-Sixth, AMT, 5.0%, 12/1/2021 (a)
5,930,000
5,969,434New York City, NY, Housing Development Corp. Revenue, NYC
Housing Authority Project, Series A, 5.0%, 7/1/2025 (a)
2,100,000
2,108,316New York City, NY, Industrial Development Agency Revenue,
Liberty-7, World Trade Center, Series A, 6.25%, 3/1/2015
2,000,000
2,022,180New York City, NY, Industrial Development Agency, Special
Facility Revenue, American Airlines, JFK International
Airport, AMT, 7.75%, 8/1/2031
3,500,000
3,138,450New York City, NY, Transitional Finance Authority Revenue,
Future Tax Secured, Series C, 5.0%, 5/1/2017
4,000,000
4,107,640New York, NY, Airport Revenue, Industrial Development
Agency, Japan Air Lines, AMT, 6.0%, 11/1/2015 (a)
595,000
602,342New York, NY, Core City General Obligation, Transitional
Finance Authority, Series B, 5.5%, 2/1/2017
480,000
515,645New York, NY, General Obligation:Series H, 5.125%, 8/1/2018 (a)
3,070,000
3,106,871Series C-1, 5.25%, 8/15/2018
3,525,000
3,765,828New York, NY, Hospital & Healthcare Revenue, Industrial
Development Agency, British Airways PLC Project, AMT,
7.625%, 12/1/2032
2,000,000
1,727,880New York, NY, Project Revenue, Industrial Development
Agency, YMCA Greater Project, 5.8%, 8/1/2016
965,000
1,002,876New York, NY, Water & Sewer Revenue, Municipal Water
Finance Authority, Series D, Zero Coupon, 6/15/2017
5,000,000
3,523,950Niagara County, NY, General Obligation, 7.1%, 2/15/2011 (a)
500,000
555,460Niagara County, NY, Industrial Development Revenue,
Industrial Development Agency, Series D,
5.55%, 11/15/2024
3,760,000
3,627,874Niagara Falls, NY, Other General Obligation, Water Treatment
Plant, AMT, 7.25%, 11/1/2011 (a)
215,000
245,532Niagara Falls, NY, Transportation/Tolls Revenue, Bridge
Commission, 5.25%, 10/1/2015 (a)
10,720,000
11,246,674North Babylon, NY, School District General Obligation, Unified
Free School District, 5.25%, 1/15/2016 (a)
1,605,000
1,684,351Oneida-Herkimer, NY, Resource Recovery Revenue, Solid
Waste Management Authority:5.5%, 4/1/2013 (a)
500,000
552,1855.5%, 4/1/2014 (a)
1,000,000
1,113,570Orange County, NY, Senior Care Revenue, Industrial
Development Agency, The Glen Arden Project:5.625%, 1/1/2018
2,000,000
1,892,7605.7%, 1/1/2028
3,250,000
2,813,330Shenendehowa, NY, School District General Obligation, Central
School District, Clifton Park, 6.85%, 6/15/2009 (a)
350,000
364,329262,691,631Puerto Rico 11.7%Commonwealth of Puerto Rico, Aqueduct & Sewer Authority
Revenue, Series A, 6.0%, 7/1/2038
3,000,000
3,145,080Commonwealth of Puerto Rico, Government Development
Bank, Series B, 5.0%, 12/1/2015
1,470,000
1,502,634Commonwealth of Puerto Rico, Highway & Transportation
Authority Revenue:Series K, 5.0%, 7/1/2017
2,000,000
2,008,480Series AA, 5.5%, 7/1/2016 (a)
2,410,000
2,525,391Commonwealth of Puerto Rico, Public Improvement:Series A, 5.5%, 7/1/2017 (a)
6,000,000
6,279,420Series A, 5.5%, 7/1/2020 (a)
6,750,000
7,002,450Puerto Rico, Electric Power Authority Revenue, 6.0%, 7/1/2012
(a)
4,020,000
4,332,153Puerto Rico, Municipal Finance Agency, Series A,
5.25%, 8/1/2024
2,500,000
2,494,550Puerto Rico, Sales & Special Tax Revenue, Highway &
Transportation Authority, Series Z, 6.0%, 7/1/2018 (a) (c)
2,750,000
3,144,212Puerto Rico, State General Obligation, Public Improvements,
5.5%, 7/1/2013 (a)
5,000,000
5,269,35037,703,720Total Municipal Bonds and Notes (Cost $290,497,719)
300,395,351Municipal Inverse Floating Rate Notes (d) 18.8%New York 16.2%New York, State Thruway Authority, Highway and Bridge Trust
Fund, Series B, 5.0%, 4/1/2019 (a) (e)
10,000,000
10,605,300Trust: New York, State Thruway Authority, Highway and
Bridge Trust Fund, Series 1071-1, 144A, 7.46%, 4/1/2019,
Leverage Factor at purchase date: 2 to 1New York, State Urban Development Corp. Revenue, State
Personal Income Tax, Series B, 5.0%, 3/15/2023 (e)
9,900,000
10,427,175Trust: New York, State Urban Development Corp. Revenue,
Series 2887, 144A, 13.4%, 3/15/2023, Leverage Factor at
purchase date: 4 to 1New York & New Jersey Port Authority, One Hundred
Forty-Seventh, AMT, 5.0%, 10/15/2027 (a) (e)
10,000,000
9,794,500Trust: New York & New Jersey Port Authority, Series 2232,
144A, AMT, 25.97%, 10/15/2027, Leverage Factor at
purchase date: 10 to 1New York City, NY, Transitional Finance Authority Revenue,
Series B, 5.0%, 11/1/2023 (e)
10,000,000
10,523,900Trust: New York City, DFA Municipal Trust, Transitional
Finance Authority, Series 3000, 144A, 16.92%, 11/1/2023,
Leverage Factor at purchase date: 5 to 1New York City, NY, Municipal Water Finance Authority, Water
& Sewer System Revenue, Series D, 5.5%, 6/15/2016 (a) (e)
10,000,000
10,821,950Trust: New York City, NY, Municipal Water Finance
Authority, Water & Sewer Revenue, RITES-PA 838,
144A, 8.95%, 6/15/2016, Leverage Factor at purchase date:
2 to 152,172,825Puerto Rico 2.6%Puerto Rico, Electric Power Authority Revenue, Series UU,
2.39%**, 7/1/2029 (a) (e)
10,000,000
8,402,500Trust: Puerto Rico, Electric Power Authority Revenue, Series
1830, 144A, 1.445%, 7/1/2029, Leverage Factor at purchase
date: 4 to 1Total Municipal Inverse Floating Rate Notes (Cost $62,220,766)
60,575,325 % of Net
Assets
Value ($)Total Investment Portfolio(Cost $352,718,485)+
112.0
360,970,676Other Assets and Liabilities, Net
(12.0)
(38,544,982)Net Assets
100.0
322,425,694 * Variable rate demand notes are securities whose interest rates are reset periodically at
market levels. These securities are often payable on demand and are shown at their
current rates as of August 31, 2008.  ** Floating rate notes are securities whose yields vary with a designated market index or
market rate, such as the coupon-equivalent of the US Treasury Bill rate. These securities
are shown at their current rate as of August 31, 2008.  +  The cost for federal income tax purposes was $352,203,529. At August 31, 2008, net
unrealized appreciation for all securities based on tax cost was $8,767,147. This consisted
of aggregate gross unrealized appreciation for all securities in which there was an excess
of value over tax cost of $13,979,293 and aggregate gross unrealized depreciation for all
securities in which there was an excess of tax cost over value of $5,212,146.  (a) Bond is insured by one of these companies:  Insurance Coverage
As a % of Total
Investment PortfolioAmbac Financial Group, Inc.
12.5Financial Guaranty Insurance Company
18.5Financial Security Assurance, Inc.
14.0MBIA Corp.
16.3 (b) Security incorporates a letter of credit from the bank listed.  (c) At August 31, 2008, this security has been pledged, in whole or in part, to cover collateral
for open interest rate swaps.  (d) Securities represent the underlying municipal obligations of inverse floating rate obligations
held by the Fund.  (e) Security forms part of the below tender option bond trust. Principal amount and value
shown take into account the leverage factor.  144A: Security exempt from registration under Rule 144A of the Securities Act of 1933. These
securities may be resold in transactions exempt from registration, normally to qualified
institutional buyers. AMT: Subject to alternative minimum tax. ETM: Bonds bearing the description ETM (escrow to maturity) are collateralized usually by US
Treasury securities which are held in escrow and used to pay principal and interest on bonds so
designated. Prerefunded: Bonds which are prerefunded are collateralized usually by US Treasury securities
which are held in escrow and used to pay principal and interest on tax-exempt issues and to
retire the bonds in full at the earliest refunding date. RITES: Residual Interest Tax Exempt Security At August 31, 2008, open interest rate swaps were as follows: Effective/
Expiration
Date
Notional
Amount ($)
Cash Flows Paid
by the Fund
Cash Flows
Received by the
Fund
Unrealized
Depreciation ($)11/18/2008
11/18/2023
5,400,0001
Fixed  5.261%
Floating  LIBOR
(330,320)9/29/2008
9/29/2027
4,400,0002
Fixed  5.555%
Floating  LIBOR
(434,962)Total unrealized depreciation on interest rate swaps
(765,282)Counterparties:1Goldman Sachs & Co.2JPMorgan ChaseLIBOR: Represents the London InterBank Offered Rate. The accompanying notes are an integral part of the financial statements. Financial Statements Statement of Assets and Liabilitiesas of August 31, 2008AssetsInvestments in securities, at value (cost $352,718,485)
$       360,970,676Cash
43,792Interest receivable
4,498,363Receivable for Fund shares sold
435,687Other assets
29,689Total assets
365,978,207LiabilitiesPayable for floating rate notes issued
41,925,000Dividends payable
222,863Payable for Fund shares redeemed
220,253Unrealized depreciation on interest rate swap contracts
765,282Accrued management fee
161,128Other accrued expenses and payables
257,987Total liabilities
43,552,513Net assets, at value
$    322,425,694Net Assets Consist ofUndistributed net investment income
198,685Net unrealized appreciation (depreciation) on:Investments
8,252,191Interest rate swaps
(765,282)Accumulated net realized gain (loss)
3,056,834Paid-in capital
311,683,266Net assets, at value
$    322,425,694 The accompanying notes are an integral part of the financial statements. Statement of Assets and Liabilitiesas of August 31, 2008 (continued)Net Asset ValueClass A
Net Asset Value, offering and redemption price(a) per share
($121,497,252 ÷ 11,551,628 outstanding shares of beneficial interest,
$.01 par value, 13,550,784 shares authorized)
$    10.52Maximum offering price per share (100 ÷ 95.50 of $10.52)
$    11.02Class B
Net Asset Value, offering and redemption price(a) (subject to contingent
deferred sales charge) per share ($2,073,950 ÷ 196,888 outstanding shares
of beneficial interest, $.01 par value, 609,345 shares authorized)
$    10.53Class C
Net Asset Value, offering and redemption price(a) (subject to contingent
deferred sales charge) per share ($5,179,339 ÷ 492,572 outstanding shares
of beneficial interest, $.01 par value, 547,117 shares authorized)
$    10.51Class S
Net Asset Value, offering and redemption price(a)per share
($193,675,153 ÷ 18,420,375 outstanding shares of beneficial interest,
$.01 par value, 16,881,058 shares authorized)
$    10.51 (a) Redemption price per share for shares held less than 15 days is equal to net asset value
less a 2% redemption fee.  The accompanying notes are an integral part of the financial statements. Statement of Operationsfor the year ended August 31, 2008Investment IncomeIncome:Interest
$       19,732,568Expenses:Management fee
1,981,400Distribution and service fees
324,965Services to shareholders
511,857Custodian fee
16,464Professional fees
88,082Trustees' fees and expenses
51,475Reports to shareholders and shareholder meeting
72,824Registration fees
49,479Interest expense and fees on floating rate notes
1,638,566Other
43,135Total expenses before expense reductions
4,778,247Expense reductions
(503,583)Total expenses after expense reductions
4,274,664Net investment income (loss)
15,457,904Realized and Unrealized Gain (Loss)Net realized gain (loss) from:Investments
3,254,608Futures
(529,400)Interest rate swaps
22,1522,747,360Change in net unrealized appreciation (depreciation) on:Investments
(6,943,208)Futures
182,212Interest rate swaps
(765,282)(7,526,278)Net gain (loss)
(4,778,918)Net increase (decrease) in net assets resulting from operations
$    10,678,986 The accompanying notes are an integral part of the financial statements. Statement of Cash Flowsfor the year ended August 31, 2008Cash Flows from Operating Activities:Investment income received*
$       20,818,430Payment of operating expenses
(2,515,976)Payment of interest expense
(1,638,566)Proceeds from sales and maturities of investments
229,165,273Purchases of investments
(164,598,272)Net receipt (payment) on interest rate swap contracts
22,152Net purchases, sales and maturities of short-term investments
80,446Net receipt (payment) on futures contracts
(317,969)Cash provided (used) by operating activities
$    81,015,518Cash Flows from Financing Activities:Proceeds from shares sold
$       60,419,978Cost of shares redeemed
(133,268,598)Distributions paid (net of reinvestment of distributions)
(7,181,032)Increase (decrease) in payable for floating rate notes issued
(980,000)Cash provided (used) by financing activities
(81,009,652)Increase (decrease) in cash
5,866Cash at beginning of period
37,926Cash at end of period
$    43,792Reconciliation of Net Increase (Decrease) in Net Assets Resulting from Operations to
Cash Provided (Used) by Operating Activities:Net increase (decrease) in net assets resulting from operations
$       10,678,986Net (increase) decrease in cost of investments
64,341,600Net (increase) decrease in unrealized appreciation (depreciation) on
investments
6,943,208(Increase) decrease in interest receivable
735,069(Increase) decrease in other assets
(9,683)Increase (decrease) in payable for investments purchased
(2,588,285)(Increase) decrease in daily variation margin on open futures contracts
29,219(Increase) decrease in unrealized depreciation on interest rate swap
contracts
765,282Increase (decrease) in other accrued expenses and payables
120,122Cash provided (used) by operating activities
$    81,015,518Non-Cash Financing Activities:Reinvestment of distributions
$       8,091,225 * Non-cash activity from market discount accretion and premium amortization in the net
amount of $350,793 has been excluded from the Statement of Cash Flows.  Statement of Changes in Net AssetsIncrease (Decrease) in Net Assets
Years Ended August 31,2008
2007Operations:Net investment income
$       15,457,904
$       15,701,916Net realized gain (loss)
2,747,360
98,466Change in net unrealized appreciation (depreciation)
(7,526,278)
(7,744,534)Net increase (decrease) in net assets resulting from
operations
10,678,986
8,055,848Distributions to shareholders from:Net investment income:Class A
(5,055,727)
(5,214,719)Class B
(77,407)
(123,155)Class C
(180,258)
(190,406)Class S
(10,010,218)
(10,023,937)Net realized gains:Class A

(742,089)Class B

(26,118)Class C

(34,049)Class S

(1,342,218)Total distributions
(15,323,610)
(17,696,691)Fund share transactions:Proceeds from shares sold
60,240,062
68,013,684Reinvestment of distributions
8,091,225
9,656,827Cost of shares redeemed
(133,223,745)
(70,719,624)Redemption fees
2,354
233Net increase (decrease) in net assets from Fund share
transactions
(64,890,104)
6,951,120Increase (decrease) in net assets
(69,534,728)
(2,689,723)Net assets at beginning of period
391,960,422
394,650,145Net assets at end of period (including undistributed net
investment income and distributions in excess of net
investment income of $198,685 and $21,414,
respectively)
$    322,425,694
$    391,960,422 The accompanying notes are an integral part of the financial statements. Financial Highlights Class A
Years Ended August 31,
2008
2007
2006
2005
2004Selected Per Share DataNet asset value, beginning of period
$    10.64
$    10.92
$    11.05
$    11.05
$    10.88Income (loss) from investment operations:
Net investment incomea
.43
.43
.44
.44
.46Net realized and unrealized gain (loss)
(.12)
(.23)
(.12)
.00*
.17Total from investment operations
.31
.20
.32
.44
.63Less distributions from:
Net investment income
(.43)
(.42)
(.43)
(.44)
(.46)Net realized gains

(.06)
(.02)

Total distributions
(.43)
(.48)
(.45)
(.44)
(.46)Redemption fees
.00*
.00*
.00*
.00*
Net asset value, end of period
$    10.52
$    10.64
$    10.92
$    11.05
$    11.05Total Return (%)b
2.97c
1.89c
2.94
4.18
5.86Ratios to Average Net Assets and Supplemental DataNet assets, end of period ($ millions)
121
128
137
150
159Ratio of expenses before expense reductions
(including interest expense) (%)d
1.34
1.10
1.20
1.02
.93Ratio of expenses after expense reductions
(including interest expense) (%)d
1.31
1.07
1.20
1.02
.93Ratio of expenses after expense reductions
(excluding interest expense) (%)
.86
.82
.85
.88
.87Ratio of net investment income (%)
4.07
3.97
4.00
4.01
4.16Portfolio turnover rate (%)
39
37
55
53
21aBased on average shares outstanding during the period.bTotal return does not reflect the effect of any sales charges.cTotal return would have been lower had certain expenses not been reduced.dInterest expense represents interest and fees on short term floating rate notes issued in
conjunction with inverse floating rate securities. Interest income from such transactions is
included in income from investment operations.*Amount is less than $.005. Class B
Years Ended August 31,
2008
2007
2006
2005
2004Selected Per Share DataNet asset value, beginning of period
$    10.66
$    10.93
$    11.07
$    11.07
$    10.90Income (loss) from investment operations:
Net investment incomea
.35
.35
.37
.37
.39Net realized and unrealized gain (loss)
(.13)
(.22)
(.13)
.00***
.17Total from investment operations
.22
.13
.24
.37
.56Less distributions from:
Net investment income
(.35)
(.34)
(.36)
(.37)
(.39)Net realized gains

(.06)
(.02)

Total distributions
(.35)
(.40)
(.38)
(.37)
(.39)Redemption fees
.00*
.00*
.00*
.00*
Net asset value, end of period
$    10.53
$    10.66
$    10.93
$    11.07
$    11.07Total Return (%)b
2.10c
1.18c
2.29c
3.44c
5.18cRatios to Average Net Assets and Supplemental DataNet assets, end of period ($ millions)
2
3
5
7
9Ratio of expenses before expense reductions
(including interest expenses) (%)d
2.19
1.96
2.09
1.87
1.77Ratio of expenses after expense reductions
(including interest expenses) (%)d
2.06
1.87
1.84
1.63
1.57Ratio of expenses after expense reductions
(excluding interest expenses) (%)
1.61
1.62
1.49
1.49
1.51Ratio of net investment income (%)
3.32
3.17
3.36
3.40
3.52Portfolio turnover rate (%)
39
37
55
53
21aBased on average shares outstanding during the period.bTotal return does not reflect the effect of any sales charges.cTotal return would have been lower had certain expenses not been reduced.dInterest expense represents interest and fees on short term floating rate notes issued in
conjunction with inverse floating rate securities. Interest income from such transactions is
included in income from investment operations.*Amount is less than $.005. Class C
Years Ended August 31,
2008
2007
2006
2005
2004Selected Per Share DataNet asset value, beginning of period
$    10.64
$    10.91
$    11.05
$    11.05
$    10.88Income (loss) from investment operations:
Net investment incomea
.35
.35
.36
.37
.38Net realized and unrealized gain (loss)
(.13)
(.22)
(.12)
.00***
.17Total from investment operations
.22
.13
.24
.37
.55Less distributions from:
Net investment income
(.35)
(.34)
(.36)
(.37)
(.38)Net realized gains

(.06)
(.02)

Total distributions
(.35)
(.40)
(.38)
(.37)
(.38)Redemption fees
.00*
.00*
.00*
.00*
Net asset value, end of period
$    10.51
$    10.64
$    10.91
$    11.05
$    11.05Total Return (%)b
2.09c
1.17c
2.22c
3.38c
5.12cRatios to Average Net Assets and Supplemental DataNet assets, end of period ($ millions)
5
6
6
6
5Ratio of expenses before expense
reductions (including interest expense) (%)d
2.15
1.92
2.03
1.82
1.73Ratio of expenses after expense
reductions  (including interest expense) (%)d
2.06
1.88
1.91
1.70
1.62Ratio of expenses after expense reductions
(excluding interest expense) (%)
1.61
1.63
1.56
1.56
1.56Ratio of net investment income (%)
3.32
3.16
3.29
3.33
3.47Portfolio turnover rate (%)
39
37
55
53
21aBased on average shares outstanding during the period.bTotal return does not reflect the effect of any sales charges.cTotal return would have been lower had certain expenses not been reduced.dInterest expense represents interest and fees on short term floating rate notes issued in
conjunction with inverse floating rate securities. Interest income from such transactions is
included in income from investment operations.*Amount is less than $.005. Class S
Years Ended August 31,
2008
2007
2006
2005
2004Selected Per Share DataNet asset value, beginning of period
$    10.64
$    10.91
$    11.05
$    11.05
$    10.88Income (loss) from investment operations:
Net investment incomea
.46
.45
.46
.46
.48Net realized and unrealized gain (loss)
(.13)
(.22)
(.13)
.00***
.18Total from investment operations
.33
.23
.33
.46
.66Less distributions from:
Net investment income
(.46)
(.44)
(.45)
(.46)
(.49)Net realized gains

(.06)
(.02)

Total distributions
(.46)
(.50)
(.47)
(.46)
(.49)Redemption fees
.00*
.00*
.00*
.00*
Net asset value, end of period
$    10.51
$    10.64
$    10.91
$    11.05
$    11.05Total Return (%)
3.13b
2.17b
3.14
4.30
6.12Ratios to Average Net Assets and Supplemental DataNet assets, end of period ($ millions)
194
256
247
187
190Ratio of expenses before expense
reductions (including interest expense) (%)c
1.26
.96
1.01
.81
.71Ratio of expenses after expense
reductions (including interest expense) (%)c
1.06
.90
1.01
.81
.71Ratio of expenses after expense reductions
(excluding interest expense) (%)
.61
.65
.66
.67
65Ratio of net investment income (%)
4.32
4.14
4.19
4.22
4.38Portfolio turnover rate (%)
39
37
55
53
21aBased on average shares outstanding during the period.bTotal return would have been lower had certain expenses not been reduced.cInterest expense represents interest and fees on short term floating rate notes issued in
conjunction with inverse floating rate securities. Interest income from such transactions is
included in income from investment operations.*Amount is less than $.005. Notes to Financial Statements A. Significant Accounting Policies DWS New York Tax-Free Income Fund (the "Fund") is a non-diversified
series of DWS State Tax-Free Income Series (the "Trust") which is
registered under the Investment Company Act of 1940, as amended (the
"1940 Act"), as an open-end management investment company organized
as a Massachusetts business trust. The Fund offers multiple classes of shares which provide investors with
different purchase options. Class A shares are offered to investors subject to
an initial sales charge. Class B shares are offered to investors without an
initial sales charge but are subject to higher ongoing expenses than Class A
shares and a contingent deferred sales charge payable upon certain
redemptions. Class B shares automatically convert to Class A shares six
years after issuance. Class C shares are offered to investors without an
initial sales charge but are subject to higher ongoing expenses than Class A
shares and a contingent deferred sales charge payable upon certain
redemptions within one year of purchase. Class C shares do not convert into
another class. Class S shares are not subject to initial or contingent deferred
sales charges and are generally not available to new investors except under
certain circumstances. Investment income, realized and unrealized gains and losses, and certain
fund-level expenses and expense reductions, if any, are borne pro rata on
the basis of relative net assets by the holders of all classes of shares,
except that each class bears certain expenses unique to that class such as
distribution and service fees, services to shareholders and certain other
class-specific expenses. Differences in class-level expenses may result in
payment of different per share dividends by class. All shares of the Fund
have equal rights with respect to voting subject to class-specific
arrangements. The Fund's financial statements are prepared in accordance with accounting
principles generally accepted in the United States of America which require
the use of management estimates. Actual results could differ from those
estimates. The policies described below are followed consistently by the
Fund in the preparation of its financial statements. Security Valuation. Investments are stated at value determined as of the
close of regular trading on the New York Stock Exchange on each day the
exchange is open for trading. Debt securities are valued by independent
pricing services approved by the Trustees of the Fund. If the pricing services
are unable to provide valuations, the securities are valued at the mean of the
most recent bid quotation or evaluated prices obtained from a broker dealer.
Such services may use various pricing techniques which take into account
appropriate factors such as yield, quality, coupon rate, maturity, type of
issue, trading characteristics and other data, as well as broker quotes. Money market instruments purchased with an original or remaining maturity
of sixty days or less, maturing at par, are valued at amortized cost. Securities and other assets for which market quotations are not readily
available or for which the above valuation procedures are deemed not to
reflect fair value are valued in a manner that is intended to reflect their fair
value as determined in accordance with procedures approved by the
Trustees. New Accounting Pronouncements. In September 2006, the Financial
Accounting Standards Board ("FASB") released Statement of Financial
Accounting Standards No. 157, "Fair Value Measurements" ("FAS 157").
FAS 157 defines fair value, establishes a framework for measuring fair value
and expands disclosures about fair value measurements. FAS 157 is
effective for fiscal years beginning after November 15, 2007. As of
August 31, 2008, management does not believe the adoption of FAS 157
will impact the amounts reported in the financial statements, however,
additional disclosures will be required about the levels of inputs used to
develop the measurements of fair value and the effect of certain of the
measurements reported in the statement of operations for a fiscal period. In addition, in March 2008, the FASB issued Statement of Financial
Accounting Standards No. 161 ("FAS 161"), "Disclosures about Derivative
Instruments and Hedging Activities". FAS 161 requires enhanced disclosure
about an entity's derivative and hedging activities including qualitative
disclosures about the objectives and strategies for using derivatives,
quantitative disclosures about fair value amounts of gains and losses on
derivative instruments, and disclosures about credit-risk-related contingent
features in derivative agreements. FAS 161 is effective for fiscal years and
interim periods beginning after November 15, 2008. Management is
currently evaluating the impact the adoption of FAS 161 will have on the
Fund's financial statement disclosures. Swap Agreements. The Fund may enter into interest rate swap transactions
to reduce the interest rate risk inherent in the Fund's underlying
investments. The use of interest rate swaps is a highly specialized activity
that involves investment techniques and risks different from those
associated with ordinary portfolio security transactions. In an interest rate
swap, the Fund would agree to pay to the other party to the interest rate
swap (which is known as the "counterparty") a fixed rate payment in
exchange for the counterparty agreeing to pay to the Fund a variable rate
payment, or the Fund would agree to receive from the counterparty a fixed
rate payment in exchange for the counterparty agreeing to receive from the
Fund a variable rate payment, the accruals for which would begin at a
specified date in the future (the "effective date"). The payment obligations
would be based on the notional amount of the swap. Certain risks may arise
when entering into swap transactions including counterparty default,
liquidity or unfavorable changes in interest rates. The Fund generally intends,
but is not obligated, to terminate its interest rate swaps before the effective
date. Payments received or made are recorded as realized gain or loss in the
Statement of Operations. The value of the swap is adjusted daily based
upon a price supplied by the counterparty and the change in value is
recorded as unrealized appreciation or depreciation. Inverse Floaters.Inverse floating rate notes are debt instruments with a
weekly floating rate of interest that bears an inverse relationship to changes
in short-term market interest rates. Investments in this type of instrument
involve special risks as compared to investments in a fixed rate municipal
security. The debt instrument in which the Fund may invest is a tender
option bond trust (the "trust") which can be established by the Fund, a
financial institution, or a broker consisting of underlying municipal
obligations with intermediate to long maturities and a fixed interest rate
("underlying bond"). Other investors in the trust usually consist of money
market fund investors receiving weekly floating interest rate payments who
have put options with the financial institutions. The Fund may enter into
shortfall and forbearance agreements by which the Fund agrees to
reimburse the trust, in certain circumstances, for the difference between
the liquidation value of the fixed rate municipal security held by the trust and
the liquidation value of the floating rate notes. These transactions are
considered a form of financing for accounting purposes. As a result, the
Fund includes the underlying bond in its investment portfolio and a
corresponding liability in the statement of assets and liabilities equal to the
floating rate note issued. When a trust is terminated and/or collapsed by
either party, the related fixed rate securities held by the trust are delivered
back to the Fund where they are either held or sold, and the related liability
of the floating rate note issued is adjusted. The Fund does not consider the
Fund's investment in inverse floaters borrowing within the meaning of the
Investment Company Act of 1940. Inverse floating rate notes exhibit added
interest rate sensitivity compared to other bonds with a similar maturity.
Moreover, since these securities are in a trust form, a sale may take longer
to settle than the standard two days after the trade date. The weighted average outstanding daily balance of the floating rate notes
issued during the year ended August 31, 2008 was approximately
$52,243,000, with a weighted average interest rate of 3.14%. Futures Contracts. A futures contract is an agreement between a buyer or
seller and an established futures exchange or its clearinghouse in which the
buyer or seller agrees to take or make a delivery of a specific amount of a
financial instrument at a specified price on a specific date (settlement date).
The Fund may enter into futures contracts as a hedge against anticipated
interest rate or fixed income market changes and for duration management,
risk management and return enhancement purposes. Upon entering into a futures contract, the Fund is required to deposit with a
financial intermediary an amount ("initial margin") equal to a certain
percentage of the face value indicated in the futures contract. Subsequent
payments ("variation margin") are made or received by the Fund dependent
upon the daily fluctuations in the value of the underlying security and are
recorded for financial reporting purposes as unrealized gains or losses by
the Fund. When entering into a closing transaction, the Fund will realize a
gain or loss equal to the difference between the value of the futures
contract to sell and the futures contract to buy. Futures contracts are valued
at the most recent settlement price. Certain risks may arise upon entering into futures contracts, including the
risk that an illiquid secondary market will limit the Fund's ability to close out
a futures contract prior to the settlement date and that a change in the value
of a futures contract may not correlate exactly with the changes in the value
of the securities hedged. When utilizing futures contracts to hedge, the
Fund gives up the opportunity to profit from favorable price movements in
the hedged positions during the term of the contract. Federal Income Taxes. The Fund's policy is to comply with the requirements
of the Internal Revenue Code, as amended, which are applicable to
regulated investment companies, and to distribute all of its taxable and
tax-exempt income to its shareholders. During the year ended August 31, 2008, the Fund utilized approximately
$63,000 of a prior year capital loss carryforward. The Fund has reviewed the tax positions for the open tax years as of August
31, 2008 and has determined that no provision for income tax is required in
the Fund's financial statements. The Fund's federal tax returns for the prior
three fiscal years remain subject to examination by the Internal Revenue
Service. Distribution of Income and Gains. Net investment income of the Fund, if
any, is declared as a daily dividend and distributed to shareholders monthly.
Net realized gains from investment transactions, in excess of available
capital loss carryforwards, would be taxable to the Fund if not distributed,
and, therefore, will be distributed to shareholders at least annually. The timing and characterization of certain income and capital gains
distributions are determined annually in accordance with federal tax
regulations which may differ from accounting principles generally accepted
in the United States of America. These differences primarily relate to
accretion of market discount on debt securities. As a result, net investment
income (loss) and net realized gain (loss) on investment transactions for a
reporting period may differ significantly from distributions during such
period. Accordingly, the Fund may periodically make reclassifications among
certain of its capital accounts without impacting the net asset value of the
Fund. At August 31, 2008 the Fund's components of distributable earnings
(accumulated losses) on a tax basis are as follows: Undistributed tax-exempt income
$       265,954Undistributed taxable income
$       171,936Undistributed long-term capital gains
$       2,700,022Net unrealized appreciation on investments
$       8,767,147 In addition, the tax character of distributions paid to shareholders by the
Fund is summarized as follows: Years Ended August 31,2008
2007Distributions from tax-exempt income
$       15,323,610
$       15,557,356Distributions from ordinary income*
$       
$       1,829,157Distributions from long-term capital gains
$       
$       310,178 * For tax purposes short-term capital gains distributions are considered taxable income
distributions.  Redemption Fees. The Fund imposes a redemption fee of 2% of the total
redemption amount on the Fund shares redeemed or exchanged within 15
days of buying them, either by purchase or exchange. This fee is assessed
and retained by the Fund for the benefit of the remaining shareholders. The
redemption fee is accounted for as an addition to paid-in capital. Expenses. Expenses of the Trust arising in connection with a specific Fund
are allocated to that Fund. Other Trust expenses which cannot be directly
attributed to a Fund are apportioned among the Funds in the Trust. Contingencies. In the normal course of business, the Fund may enter into
contracts with service providers that contain general indemnification
clauses. The Fund's maximum exposure under these arrangements is
unknown as this would involve future claims that may be made against the
Fund that have not yet been made. However, based on experience, the Fund
expects the risk of loss to be remote. Other. Investment transactions are accounted for on a trade date plus one
basis for daily net asset value calculations. However, for financial reporting
purposes, investment security transactions are reported on trade date.
Interest income is recorded on the accrual basis. Realized gains and losses
from investment transactions are recorded on an identified cost basis. All
premiums and discounts are amortized/accreted for financial reporting
purposes. Statement of Cash Flows. Information of financial transactions which have
been settled through the receipt and disbursement of cash is presented in
the Statement of Cash Flows. The end of period cash amount shown in the
Statement of Cash Flows represents the cash position in the Fund's
custodian bank at August 31, 2008. Non-cash activity from market discount
accretion and premium amortization has been excluded from Statement of
Cash Flows. B. Purchases and Sales of Securities During the year ended August 31, 2008, purchases and sales of investment
securities (excluding short-term investments) aggregated $162,000,305 and
$229,165,273, respectively. C. Related Parties Management Agreement. Under the Investment Management Agreement
with Deutsche Investment Management Americas Inc. ("DIMA" or the
"Advisor"), an indirect, wholly owned subsidiary of Deutsche Bank AG, the
Advisor directs the investments of the Fund in accordance with its
investment objectives, policies and restrictions. The Advisor determines the
securities, instruments and other contracts relating to investments to be
purchased, sold or entered into by the Fund. In addition to portfolio
management services, the Advisor provides certain administrative services
in accordance with the Investment Management Agreement. The Fund pays a monthly management fee, computed and accrued daily and
payable monthly at the following annual rates: First $250 million of the Fund's average daily net assets
.55%Next $750 million of such net assets
.52%Next $1.5 billion of such net assets
.50%Next $2.5 billion of such net assets
.48%Next $2.5 billion of such net assets
.45%Next $2.5 billion of such net assets
.43%Next $2.5 billion of such net assets
.41%Over $12.5 billion of such net assets
.40% For the period from September 1, 2007 through September 30, 2007, the
Advisor had contractually agreed to waive all or a portion of its management
fee (excluding certain expenses such as extraordinary expenses, taxes,
brokerage and interest) to the extent necessary to maintain operating
expenses of each class as follows: Class A
.83%Class B
1.63%Class C
1.64%Class S
.64% Effective October 1, 2007 through November 30, 2008, the Advisor has
contractually agreed to waive all or a portion of its management fee and
reimburse or pay certain operating expenses of the Fund (excluding certain
expenses such as extraordinary expenses, taxes, brokerage and interest
expenses) to the extent necessary to maintain the operating expenses of
each class as follows: Class A
.85%Class B
1.60%Class C
1.60%Class S
.60% Accordingly, for the year ended August 31, 2008, the fee pursuant to the
Investment Management Agreement aggregated $1,981,400, of which
$61,142 was waived, resulting in an annual effective rate of 0.52% of the
Fund's average daily net assets. For the year ended August 31, 2008, the Advisor agreed to reimburse the
Fund $339,754 of sub-recordkeeping expenses for Class S shares. Service Provider Fees. DWS Investments Service Company ("DISC"), an
affiliate of the Advisor, is the transfer agent, dividend-paying agent and
shareholder service agent of the Fund. Pursuant to a sub-transfer agency
agreement between DISC and DST Systems, Inc. ("DST"), DISC has
delegated certain transfer agent, dividend-paying agent and shareholder
service agent functions to DST. DISC compensates DST out of the
shareholder servicing fee it receives from the Fund. For the year ended
August 31, 2008, the amounts charged to the Fund by DISC were as
follows: Services to Shareholders
Total
Aggregated
Waived
Unpaid at
August 31, 2008Class A
$       54,062
$       5,273
$       17,342Class B
2,078
2,078
Class C
2,680
2,680
Class S
66,601
66,601
$    125,421
$    76,632
$    17,342 Distribution and Service Fees. Under the Fund's Class B and Class C  12b-1
Plans, DWS Investments Distributors, Inc. ("DIDI"), an affiliate of the
Advisor, receives a fee ("Distribution Fee") of 0.75% of average daily net
assets of each of Class B and C shares. In accordance with the Fund's
Underwriting and Distribution Services Agreement, DIDI enters into related
selling group agreements with various firms at various rates for sales of
Class B and C shares, respectively. For the year ended August 31, 2008, the
Distribution Fee was as follows: Distribution Fee
Total
Aggregated
Unpaid at
August 31, 2008Class B
$       17,696
$       1,355Class C
41,147
3,437$    58,843
$    4,792 In addition, DIDI provides information and administrative services for a fee
("Service Fee") to the Fund at an annual rate of up to 0.25% of average daily
net assets for Class A, B and C shareholders. DIDI in turn has various
agreements with financial services firms that provide these services and
pays these fees based upon the assets of shareholder accounts the firms
service. For the year ended August 31, 2008, the Service Fee was as
follows: Service Fee
Total
Aggregated
Waived
Unpaid at
August 31, 2008
Annual
Effective RateClass A
$       246,718
$       
$       25,825
.20%Class B
5,727
370
462
.23%Class C
13,677
644
864
.24%$    266,122
$    1,014
$    27,151 Underwriting and Contingent Deferred Sales Charge. DIDI is the principal
underwriter for the Fund. Underwriting commissions paid in connection
with the distribution of Class A shares for the year ended August 31, 2008
aggregated $7,857. In addition, DIDI receives any contingent deferred sales charge ("CDSC")
from Class B share redemptions occurring within six years of purchase and
Class C share redemptions occurring within one year of purchase. There is
no such charge upon redemption of any share appreciation or reinvested
dividends. The CDSC is based on declining rates ranging from 4% to 1% for
Class B and 1% for Class C, of the value of the shares redeemed. For the
year ended August 31, 2008, the CDSC for Class B and C shares was
$3,497 and $240, respectively. A deferred sales charge of up to 1% is
assessed on certain redemptions of Class A shares. Typesetting and Filing Service Fees. Under an agreement with DIMA, DIMA
is compensated for providing typesetting and certain regulatory filing
services to the Fund. For the year ended August 31, 2008, the amount
charged to the Fund by DIMA included in the Statement of Operations
under "reports to shareholders and shareholder meeting" aggregated
$28,745, of which $12,996 is unpaid. Trustees' Fees and Expenses. The Fund paid each Trustee not affiliated with
the Advisor retainer fees plus specific amounts for various committee
services and for the Board Chairperson and Vice Chairperson. In connection with the board consolidation on April 1, 2008, of the two DWS
Funds Boards of Trustees, certain Independent Board Members retired prior
to their normal retirement date, and received a one-time retirement benefit.
DIMA has agreed to reimburse the Funds for the cost of this benefit. During
the period ended August 31, 2008, the Fund paid its allocated portion of the
retirement benefit of $19,025 to the non-continuing Independent Board
Members, and the Fund was reimbursed by DIMA for this payment. D. Fee Reductions For the year ended August 31, 2008, the Advisor agreed to reimburse the
Fund $1,819, which represented a portion of the expected fee savings for
the Advisor through December 31, 2007 related to the outsourcing by the
Advisor of certain administrative services to an unaffiliated service provider. In addition, the Fund has entered into an arrangement with its custodian and
transfer agent whereby credits realized as a result of uninvested cash
balances are used to reduce a portion of the Fund's custodian expenses.
During the year ended August 31, 2008, the Fund's custodian fee was
reduced by $845 and $3,352, respectively, for custodian and transfer agent
credits earned. E. Line of Credit The Fund and other affiliated funds (the "Participants") share in a
$490 million revolving credit facility provided by a syndication of banks. The
Fund may borrow for temporary or emergency purposes, including the
meeting of redemption requests that otherwise might require the untimely
disposition of securities. The Participants are charged an annual
commitment fee which is allocated based on net assets, among each of the
Participants. Interest is calculated at the Federal Funds Rate plus
0.35 percent. The Fund may borrow up to a maximum of 33 percent of its
net assets under the agreement. F. Share Transactions The following table summarizes share and dollar activity in the Fund: Year Ended August 31, 2008
Year Ended August 31, 2007Shares
Dollars
Shares
DollarsShares soldClass A
454,873
$       4,832,942
477,902
$       5,166,882Class B
18,400
196,961
13,541
146,763Class C
82,174
876,290
28,806
312,738Class S
5,147,426
54,333,869
5,857,402
62,387,301$    60,240,062

$    68,013,684Shares issued to shareholders in reinvestments of distributionsClass A
323,629
$       3,437,076
377,134
$       4,078,836Class B
4,672
49,721
9,446
102,602Class C
10,476
111,333
13,770
148,982Class S
423,169
4,493,095
492,498
5,326,407$    8,091,225

$    9,656,827Shares redeemedClass A
(1,241,319)
$       (13,182,881)
(1,389,630)
$       (15,020,654)Class B
(74,045)
(792,867)
(225,191)
(2,430,814)Class C
(134,232)
(1,412,617)
(75,119)
(808,074)Class S
(11,188,248)
(117,835,380)
(4,900,780)
(52,460,082)$    (133,223,745)

$    (70,719,624)Redemption fees

$    2,354

$    233Net increase (decrease)Class A
(462,817)
$       (4,912,820)
(534,594)
$       (5,774,936)Class B
(50,973)
(546,185)
(202,204)
(2,181,449)Class C
(41,582)
(424,994)
(32,543)
(346,354)Class S
(5,617,653)
(59,006,105)
1,449,120
15,253,859$    (64,890,104)

$    6,951,120 Report of Independent Registered
Public Accounting Firm To the Trustees of DWS State Tax-Free Income Series and Shareholders of
DWS New York Tax-Free Income Fund: We have audited the accompanying statement of assets and liabilities,
including the investment portfolio, of DWS New York Tax-Free Income Fund
(the "Fund"), one of the series of DWS State Tax-Free Income Series (the
"Trust"), as of August 31, 2008, and the related statements of operations
and cash flows for the year then ended, the statement of changes in net
assets for each of the two years in the period then ended, and the financial
highlights for each of the five years in the period then ended. These financial
statements and financial highlights are the responsibility of the Fund's
management. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audits. We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards
require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements and financial highlights are free of
material misstatement. We were not engaged to perform an audit of the
Fund's internal control over financial reporting. Our audits included
consideration of internal control over financial reporting as a basis for designing
audit procedures that are appropriate in the circumstances, but not for the
purpose of expressing an opinion on the effectiveness of the Fund's internal
control over financial reporting. Accordingly, we express no such opinion. An
audit also includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements and financial highlights,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. Our
procedures included confirmation of securities owned as of August 31,
2008, by correspondence with the custodian and broker. We believe that our
audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
DWS New York Tax-Free Income Fund at August 31, 2008, the results of its
operations and its cash flows for the year then ended, the changes in its net
assets for each of the two years in the period then ended, and the financial
highlights for each of the five years in the period then ended in conformity
with U.S. generally accepted accounting principles. Boston, Massachusetts
October 23, 2008

ntf_eny0 Tax Information(Unaudited) Pursuant to Section 852 of the Internal Revenue Code, the Fund designates
$2,970,000 as capital gain dividends for its year ended August 31, 2008, of
which 100% represents 15% rate gains. Of the dividends paid from net investment income for taxable year ended
August 31, 2008, 100% are designated as exempt interest dividends for
federal income tax purposes. Please consult a tax advisor if you have questions about federal or state
income tax laws, or on how to prepare your tax returns. If you have specific
questions about your account, please call (800) 621-1048. Shareholder Meeting Results(Unaudited) The Special Meeting of Shareholders of DWS New York Tax-Free Income
Fund (the "Fund") was held on March 31, 2008 at the offices of Deutsche
Asset Management, 345 Park Avenue, New York, NY 10154. The following
matters were voted upon by the shareholders of said Fund (the resulting
votes are presented below): 1.       Election of the Board of Trustees. Number of Votes:Trustee
For
WithheldJohn W. Ballantine
27,080,413.3390
1,387,598.9180Henry P. Becton, Jr.
26,978,047.3990
1,489,964.8580Dawn-Marie Driscoll
27,058,088.7550
1,409,923.5020Keith R. Fox
26,968,133.4010
1,499,878.8560Paul K. Freeman
27,076,577.4990
1,391,434.7580Kenneth C. Froewiss
27,077,614.6240
1,390,397.6330Richard J. Herring
26,982,106.9220
1,485,905.3350William McClayton
27,055,440.9900
1,412,571.2670Rebecca W. Rimel
26,971,931.8270
1,496,080.4300William N. Searcy, Jr.
26,988,285.7620
1,479,726.4950Jean Gleason Stromberg
26,980,533.1700
1,487,479.0870Robert H. Wadsworth
27,057,584.6060
1,410,427.6510Axel Schwarzer
27,044,949.0150
1,423,063.2420 The meeting was reconvened on May 1, 2008, at which time the following
matter was voted upon by the shareholders: 4-A.     Approval of Amended and Restated Declarations of Trust. Number of Votes:For
Against
Abstain18,760,425.8070
1,306,017.0430
2,035,846.0710 The meeting was then reconvened on August 15, 2008, at which time the
following matters were voted upon by the shareholders: 2-A.     Approval of an Amended and Restated Investment Management
Agreement. Number of Votes:For
Against
Abstain21,046,176.1710
1,810,193.0520
2,192,988.4640 2-B.     Approval of a Subadvisor Approval Policy. Number of Votes:For
Against
Abstain21,289,350.1260
1,610,836.1470
2,149,173.4140 3.       Approval of a Revised Fundamental Investment Policy Regarding
Commodities. Number of Votes:For
Against
Abstain20,929,252.2560
1,845,382.9450
2,274,724.4860 Summary of Management Fee Evaluation by
Independent Fee Consultant October 26, 2007 Pursuant to an Order entered into by Deutsche Investment Management
Americas and affiliates (collectively, "DeAM") with the Attorney General of
New York, I, Thomas H. Mack, have been appointed the Independent Fee
Consultant for the DWS Scudder Funds. My duties include preparing an
annual written evaluation of the management fees DeAM charges the
Funds, considering among other factors the management fees charged by
other mutual fund companies for like services, management fees DeAM
charges other clients for like services, DeAM's costs of supplying services
under the management agreements and related profit margins, possible
economies of scale if a Fund grows larger, and the nature and quality of
DeAM's services, including fund performance. This report summarizes my
evaluation for 2007, including my qualifications, the evaluation process for
each of the DWS Scudder Funds, consideration of certain complex-level
factors, and my conclusions. Qualifications For more than 30 years I have served in various professional capacities
within the investment management business. I have held investment
analysis and advisory positions, including securities analyst, portfolio
strategist and director of investment policy with a large investment firm. I
have also performed business management functions, including business
development, financial management and marketing research and analysis. Since 1991, I have been an independent consultant within the asset
management industry. I have provided services to over 125 client
organizations, including investment managers, mutual fund boards, product
distributors and related organizations. Over the past several years I have
completed a number of assignments for mutual fund boards, specifically
including assisting boards with management contract renewal. I hold a Master of Business Administration degree, with highest honors,
from Harvard University; and Master of Science and Bachelor of Science
(highest honors) degrees from the University of California at Berkeley. I am
an independent director and audit committee financial expert for two
closed-end mutual funds, serve on the board of directors of a private market
research company, and have served in various leadership and financial
oversight capacities with non-profit organizations. Evaluation of Fees for each DWS Scudder Fund My work focused primarily on evaluating, fund-by-fund, the fees charged to
each of the 136 Fund portfolios in the DWS Scudder Fund family. For each
Fund, I considered each of the key factors mentioned above, as well as any
other relevant information. In doing so I worked closely with the Funds'
Independent Directors in their annual contract renewal process, as well as in
their approval of contracts for several new funds (documented separately). In evaluating each Fund's fees, I reviewed comprehensive materials provided
by or on behalf of DeAM, including expense information prepared by Lipper
Analytical, comparative performance information, profitability data, manager
histories, and other materials. I also accessed certain additional information
from the Lipper, Strategic Insight, and Morningstar databases and drew on
my industry knowledge and experience. To facilitate evaluating this considerable body of information, I prepared for
each Fund a document summarizing the key data elements in each area as
well as additional analytics discussed below. This made it possible to
consider each key data element in the context of the others. In the course of contract renewal, DeAM agreed to implement a number of
fee and expense adjustments requested by the Independent Directors
which will favorably impact future fees and expenses, and my evaluation
includes the effects of these changes. Fees and Expenses Compared with Other Funds The competitive fee and expense evaluation for each fund focused on two
primary comparisons: The Fund's contractual management fee (the advisory fee plus the
administration fee where applicable) compared with those of a group of
typically 12-15 funds in the same Lipper investment category (e.g. Large
Capitalization Growth) having similar distribution arrangements and being
of similar size. The Fund's total expenses compared with a broader universe of funds
from the same Lipper investment category and having similar distribution
arrangements. These two comparisons provide a view of not only the level of the fee
compared with funds of similar scale but also the total expense the Fund
bears for all the services it receives, in comparison with the investment
choices available in the Fund's investment category and distribution channel.
The principal figure-of-merit used in these comparisons was the subject
Fund's percentile ranking against peers. DeAM's Fees for Similar Services to Others DeAM provided management fee schedules for all of its US domiciled fund
and non-fund investment management accounts in any of the investment
categories where there is a DWS Scudder Fund. These similar products
included the other DWS Scudder Funds, non-fund pooled accounts,
institutional accounts and sub-advisory accounts. Using this information, I
calculated for each Fund the fee that would be charged to each similar
product, at the subject Fund's asset level. Evaluating information regarding non-fund products is difficult because there
are varying levels of services required for different types of accounts, with
mutual funds generally requiring considerably more regulatory and
administrative types of service as well as having more frequent cash flows
than other types of accounts. Also, while mutual fund fees for similar fund
products can be expected to be similar, there will be some differences due
to different pricing conditions in different distribution channels (e.g. retail
funds versus those used in variable insurance products), differences in
underlying investment processes and other factors. Costs and Profit Margins DeAM provided a detailed profitability analysis for each Fund. After making
some adjustments so that the presentation would be more comparable to
the available industry figures, I reviewed profit margins from investment
management alone, from investment management plus other fund services
(excluding distribution) provided to the Funds by DeAM (principally
shareholder services), and DeAM profits from all sources, including
distribution. A later section comments on overall profitability. Economies of Scale Economies of scale  an expected decline in management cost per dollar
of fund assets as fund assets grow  are very rarely quantified and
documented because of inherent difficulties in collecting and analyzing
relevant data. However, in virtually every investment category that I
reviewed, larger funds tend to have lower fees and lower total expenses
than smaller funds. To see how each DWS Scudder Fund compares with
this industry observation, I reviewed: The trend in Fund assets over the last five years and the accompanying
trend in total expenses. This shows if the Fund has grown and, if so,
whether total expense (management fees as well as other expenses)
have declined as a percent of assets. Whether the Fund has break-points in its management fee schedule, the
extent of the fee reduction built into the schedule and the asset levels
where the breaks take effect, and in the case of a sub-advised Fund how
the Fund's break-points compare with those of the sub-advisory fee
schedule. How the Fund's contractual fee schedule compares with trends in the
industry data. To accomplish this, I constructed a chart showing how
actual latest-fiscal-year contractual fees of the Fund and of other similar
funds relate to average fund assets, with the subject Fund's contractual
fee schedule superimposed. Quality of Service  Performance The quality-of-service evaluation focused on investment performance, which
is the principal result of the investment management service. Each Fund's
performance was reviewed over the past 1, 3, 5 and 10 years, as applicable,
and compared with that of other funds in the same investment category and
with a suitable market index. In addition, I calculated and reviewed risk-adjusted returns relative to an
index of similar mutual funds' returns and a suitable market index. The
risk-adjusted returns analysis provides a way of determining the extent to
which the Fund's return comparisons are mainly the product of investment
value-added (or lack thereof) or alternatively taking considerably more or less
risk than is typical in its investment category. I also received and considered the history of portfolio manager changes for
each Fund, as this provided an important context for evaluating the
performance results. Complex-Level Considerations While this evaluation was conducted mainly at the individual fund level,
there are some issues relating to the reasonableness of fees that can
alternatively be considered across the whole fund complex: I reviewed DeAM's profitability analysis for all DWS Scudder funds, with a
view toward determining if the allocation procedures used were
reasonable and how profit levels compared with public data for other
investment managers. I considered whether DeAM and affiliates receive any significant ancillary
or "fall-out" benefits that should be considered in interpreting the direct
profitability results. These would be situations where serving as the
investment manager of the Funds is beneficial to another part of the
Deutsche Bank organization. I considered how aggregated DWS Scudder Fund expenses had varied
over the years, by asset class and in the context of trends in asset levels. I reviewed the structure of the DeAM organization, trends in staffing
levels, and information on compensation of investment management and
other professionals compared with industry data. Findings Based on the process and analysis discussed above, which included
reviewing a wide range of information from management and external data
sources and considering among other factors the fees DeAM charges other
clients, the fees charged by other fund managers, DeAM's costs and profits
associated with managing the Funds, economies of scale, possible fall-out
benefits, and the nature and quality of services provided, in my opinion the
management fees charged the DWS Scudder Funds are reasonable. ntf_mack0Thomas H. Mack Trustees and Officers The following table presents certain information regarding the Board
Members and Officers of the Trust as of August 31, 2008. Each Board
Member's year of birth is set forth in parentheses after his or her name.
Unless otherwise noted, (i) each Board Member has engaged in the
principal occupation(s) noted in the table for at least the most recent five
years, although not necessarily in the same capacity; and (ii) the address of
each Independent Board Member is c/o Dawn-Marie Driscoll, PO Box
100176, Cape Coral, FL 33904. Except as otherwise noted below, the term
of office for each Board Member is until the election and qualification of a
successor, or until such Board Member sooner dies, resigns, is removed or
as otherwise provided in the governing documents of the fund. Because the
fund does not hold an annual meeting of shareholders, each Board Member
will hold office for an indeterminate period. The Board Members may also
serve in similar capacities with other funds in the fund complex. The Length
of Time Served represents the year in which the Board Member joined the
board of one or more DWS funds now overseen by the Board. Independent Board MembersName, Year of
Birth, Position
with the Fund
and Length of
Time Served1
Business Experience and Directorships During the
Past Five Years
Number of
Funds in
DWS Fund
Complex
OverseenDawn-Marie
Driscoll (1946)Chairperson since
20042Board Member
since 1987
President, Driscoll Associates (consulting firm); Executive
Fellow, Center for Business Ethics, Bentley College; formerly,
Partner, Palmer & Dodge (1988-1990); Vice President of
Corporate Affairs and General Counsel, Filene's (1978-1988).
Directorships: Trustee of eight open-end mutual funds
managed by Sun Capital Advisers, Inc. (since 2007); Director of
ICI Mutual Insurance Company (since 2007); Advisory Board,
Center for Business Ethics, Bentley College; Trustee,
Southwest Florida Community Foundation (charitable
organization). Former Directorships: Investment Company
Institute (audit, executive, nominating committees) and
Independent Directors Council (governance, executive
committees)
133Paul K. Freeman
(1950)Vice Chairperson
since 2008Board Member
since 1993
Consultant, World Bank/Inter-American Development Bank;
formerly, Project Leader, International Institute for Applied
Systems Analysis (1998-2001); Chief Executive Officer, The
Eric Group, Inc. (environmental insurance) (1986-1998)
133John W.
Ballantine (1946)Board Member
since 1999
Retired; formerly, Executive Vice President and Chief Risk
Management Officer, First Chicago NBD Corporation/The First
National Bank of Chicago (1996-1998); Executive Vice
President and Head of International Banking (1995-1996).
Directorships: Healthways, Inc. (provider of disease and care
management services); Portland General Electric (utility
company); Stockwell Capital Investments PLC (private equity).
Former Directorships: First Oak Brook Bancshares, Inc. and
Oak Brook Bank
133Henry P. Becton,
Jr. (1943)Board Member
since 1990
Vice Chair, WGBH Educational Foundation. Directorships:
Association of Public Television Stations; Becton Dickinson
and Company3 (medical technology company); Belo
Corporation3 (media company); Boston Museum of Science;
Public Radio International. Former Directorships: American
Public Television; Concord Academy; New England Aquarium;
Mass. Corporation for Educational Telecommunications;
Committee for Economic Development; Public Broadcasting
Service
133Keith R. Fox
(1954)Board Member
since 1996
Managing General Partner, Exeter Capital Partners (a series of
private equity funds). Directorships: Progressive Holding
Corporation (kitchen goods importer and distributor); Natural
History, Inc. (magazine publisher); Box Top Media Inc.
(advertising); The Kennel Shop (retailer)
133Kenneth C.
Froewiss (1945)Board Member
since 2001
Clinical Professor of Finance, NYU Stern School of Business
(1997-present); Member, Finance Committee, Association for
Asian Studies (2002-present); Director, Mitsui Sumitomo
Insurance Group (US) (2004-present); prior thereto, Managing
Director, J.P. Morgan (investment banking firm) (until 1996)
133Richard J. Herring
(1946)Board Member
since 1990
Jacob Safra Professor of International Banking and Professor,
Finance Department, The Wharton School, University of
Pennsylvania (since July 1972); Co-Director, Wharton Financial
Institutions Center (since July 2000); Director, Japan Equity
Fund, Inc. (since September 2007), Thai Capital Fund, Inc.
(since September 2007), Singapore Fund, Inc. (since
September 2007). Formerly, Vice Dean and Director, Wharton
Undergraduate Division (July 1995-June 2000); Director,
Lauder Institute of International Management Studies (July
2000-June 2006)
133William
McClayton (1944)Board Member
since 2004
Managing Director, Diamond Management & Technology
Consultants, Inc. (global management consulting firm)
(2001-present); Directorship: Board of Managers, YMCA of
Metropolitan Chicago; formerly: Senior Partner, Arthur
Andersen LLP (accounting) (1966-2001); Trustee, Ravinia
Festival
133Rebecca W.
Rimel (1951)Board Member
since 1995
President and Chief Executive Officer, The Pew Charitable
Trusts (charitable organization) (1994 to present); Trustee,
Thomas Jefferson Foundation (charitable organization) (1994 to
present); Trustee, Executive Committee, Philadelphia Chamber
of Commerce (2001-2007); Trustee, Pro Publica
(2007-present) (charitable organization). Formerly, Executive
Vice President, The Glenmede Trust Company (investment
trust and wealth management) (1983-2004); Board Member,
Investor Education (charitable organization) (2004-2005);
Director, Viasys Health Care3 (January 2007-June 2007)
133William N. Searcy,
Jr. (1946)Board Member
since 1993
Private investor since October 2003; Trustee of eight open-end
mutual funds managed by Sun Capital Advisers, Inc. (since
October 1998). Formerly, Pension & Savings Trust Officer,
Sprint Corporation3 (telecommunications) (November
1989-September 2003)
133Jean Gleason
Stromberg (1943)Board Member
since 1997
Retired. Formerly, Consultant (1997-2001); Director, US
Government Accountability Office (1996-1997); Partner,
Fulbright & Jaworski, L.L.P. (law firm) (1978-1996).
Directorships: The William and Flora Hewlett Foundation;
Service Source, Inc. Former Directorships: Mutual Fund
Directors Forum (2002-2004), American Bar Retirement
Association (funding vehicle for retirement plans) (1987-1990
and 1994-1996)
133Robert H.
Wadsworth(1940)Board Member
since 1999
President, Robert H. Wadsworth & Associates, Inc. (consulting
firm) (1983 to present); Director, The Phoenix Boys Choir
Association
136 Interested Board MemberName, Year of
Birth, Position
with the Fund
and Length of
Time Served1
Business Experience and Directorships During the
Past Five Years
Number of
Funds in
Fund
Complex
OverseenAxel Schwarzer4(1958)Board Member
since 2006
Managing Director5, Deutsche Asset Management; Head of
Deutsche Asset Management Americas; CEO of DWS Investments;
formerly, board member of DWS Investments, Germany
(1999-2005); formerly, Head of Sales and Product Management for
the Retail and Private Banking Division of Deutsche Bank in
Germany (1997-1999); formerly, various strategic and operational
positions for Deutsche Bank Germany Retail and Private Banking
Division in the field of investment funds, tax driven instruments and
asset management for corporates (1989-1996)
133 Officers6Name, Year of Birth,
Position with the Fund and
Length of Time Served7
Principal Occupation(s) During Past 5 Years and Other
Directorships HeldMichael G. Clark8 (1965)President, 2006-present
Managing Director5, Deutsche Asset Management
(2006-present); President of DWS family of funds; Director, ICI
Mutual Insurance Company (since October 2007); formerly,
Director of Fund Board Relations (2004-2006) and Director of
Product Development (2000-2004), Merrill Lynch Investment
Managers; Senior Vice President Operations, Merrill Lynch
Asset Management (1999-2000)John Millette9 (1962)Vice President and Secretary,
1999-present
Director5, Deutsche Asset ManagementPaul H. Schubert8 (1963)Chief Financial Officer,
2004-presentTreasurer, 2005-present
Managing Director5, Deutsche Asset Management (since July
2004); formerly, Executive Director, Head of Mutual Fund
Services and Treasurer for UBS Family of Funds (1998-2004);
Vice President and Director of Mutual Fund Finance at UBS
Global Asset Management (1994-1998)Patricia DeFilippis10(1963)Assistant Secretary,
2005-present
Vice President, Deutsche Asset Management (since June
2005); formerly, Counsel, New York Life Investment
Management LLC (2003-2005); legal associate, Lord, Abbett &
Co. LLC (1998-2003)Elisa D. Metzger10 (1962)Assistant Secretary
2005-present
Director5, Deutsche Asset Management (since September
2005); formerly, Counsel, Morrison and Foerster LLP
(1999-2005)Caroline Pearson9 (1962)Assistant Secretary,
1997-present
Managing Director5, Deutsche Asset ManagementPaul Antosca9 (1957)Assistant Treasurer,
2007-present
Director5, Deutsche Asset Management (since 2006); Vice
President, The Manufacturers Life Insurance Company (U.S.A.)
(1990-2006)Jack Clark9 (1967)Assistant Treasurer,
2007-present
Director5, Deutsche Asset Management (since 2007);
formerly, Vice President, State Street Corporation (2002-2007)Kathleen Sullivan D'Eramo9
(1957)Assistant Treasurer,
2003-present
Director5, Deutsche Asset ManagementDiane Kenneally9(1966)Assistant Treasurer,
2007-present
Director5, Deutsche Asset ManagementJason Vazquez10 (1972)Anti-Money Laundering
Compliance Officer,
2007-present
Vice President, Deutsche Asset Management (since 2006);
formerly, AML Operations Manager for Bear Stearns
(2004-2006), Supervising Compliance Principal and Operations
Manager for AXA Financial (1999-2004)Robert Kloby10 (1962)Chief Compliance Officer,
2006-present
Managing Director5, Deutsche Asset Management
(2004-present); formerly, Chief Compliance Officer/Chief Risk
Officer, Robeco USA (2000-2004); Vice President, The
Prudential Insurance Company of America (1988-2000);
E.F. Hutton and Company (1984-1988)J. Christopher Jackson10
(1951)Chief Legal Officer,
2006-present
Director5, Deutsche Asset Management (2006-present);
formerly, Director, Senior Vice President, General Counsel and
Assistant Secretary, Hansberger Global Investors, Inc.
(1996-2006); Director, National Society of Compliance
Professionals (2002-2005) (2006-2009) 1 The length of time served represents the year in which the Board Member joined the board
of one or more DWS funds currently overseen by the Board.  2 Represents the year Ms. Driscoll was first appointed Chairperson of certain DWS funds.  3 A publicly held company with securities registered pursuant to Section 12 of the Securities
Exchange Act of 1934.  4 The mailing address of Axel Schwarzer is c/o Deutsche Investment Management Americas
Inc., 345 Park Avenue, New York, New York 10154. Mr. Schwarzer is an interested Board
Member by virtue of his positions with Deutsche Asset Management. As an interested
person, Mr. Schwarzer receives no compensation from the fund.  5 Executive title, not a board directorship.  6 As a result of their respective positions held with the Advisor, these individuals are
considered "interested persons" of the Advisor within the meaning of the 1940 Act.
Interested persons receive no compensation from the fund.  7 The length of time served represents the year in which the officer was first elected in such
capacity for one or more DWS funds.  8 Address: 345 Park Avenue, New York, New York 10154.  9 Address: One Beacon Street, Boston, MA 02108.  10 Address: 280 Park Avenue, New York, New York 10017.  The fund's Statement of Additional Information ("SAI") includes additional information about
the Board Members. The SAI is available, without charge, upon request. If you would like to
request a copy of the SAI, you may do so by calling the following toll-free number:
(800) 621-1048. Account Management Resources For More
Information
The automated telephone system allows you to access personalized
account information and obtain information on other DWS funds using
either your voice or your telephone keypad. Certain account types
within Classes A, B, C and S also have the ability to purchase,
exchange or redeem shares using this system.For more information, contact your financial advisor. You may
also access our automated telephone system or speak with a
DWS Investments representative by calling the appropriate
number below:For shareholders of Classes A, B and C:
(800) 621-1048For shareholders of Class S:
(800) 728-3337Web Site
www.dws-investments.com
View your account transactions and balances, trade shares, monitor
your asset allocation, and change your address, 24 hours a day.Obtain prospectuses and applications,blank forms, interactive
worksheets, news about DWS funds, subscription to fund updates by
e-mail, retirement planning information, and more.Written
Correspondence
DWS Investments
PO Box 219151
Kansas City, MO 64121-9151Proxy Voting
The fund's policies and procedures for voting proxies for portfolio
securities and information about how the fund voted proxies related to
its portfolio securities during the 12-month period endedJune 30are
available on our Web site  www.dws-investments.com (click on
"proxy voting"at the bottom of the page)  or on the SEC's Web site
 www.sec.gov. To obtain a written copy of the fund's policies and
procedures without charge, upon request, call us toll free at (800)
621-1048.Principal
Underwriter
If you have questions, comments or complaints, contact:DWS Investments Distributors, Inc.
222 South Riverside Plaza
Chicago, IL 60606-5808(800) 621-1148 Class A
Class B
Class C
Class SNasdaq Symbol
KNTAX
KNTBX
KNTCX
SNWYXCUSIP Number
23337H  504
23337H  603
23337H  702
23337H  801Fund Number
26
226
326
SNWYX ntf_backcover0


ITEM 2.
        CODE OF ETHICSAs of the end of the period, August 31, 2008, DWS New York Tax-Free Income Fund
has a code of ethics, as defined in Item 2 of Form N-CSR, that applies to its Principal Executive Officer and Principal Financial Officer.

There have been no amendments to, or waivers from, a provision of the code of ethics during the period covered by this report that would require disclosure under Item 2.

A copy of the code of ethics is filed as an exhibit to this Form N-CSR.ITEM 3.
        AUDIT COMMITTEE FINANCIAL EXPERTThe Funds audit committee is comprised solely of trustees who are independent (as such term has been defined by the Securities and Exchange Commission (SEC) in regulations implementing Section 407 of the Sarbanes-Oxley Act (the Regulations)). The Funds Board of Trustees has determined that there are several audit committee financial experts (as such term has been defined by the Regulations) serving on the Funds audit committee including Mr. William McClayton, the chair of the Funds audit committee.  The SEC has stated that an audit committee financial expert is not an expert for any purpose, including for purposes of Section 11 of the Securities Act of 1933 and the designation or identification of a person as an audit committee
financial expert pursuant to this Item 3 of Form N-CSR does not impose on such person any duties, obligations or liability that are greater than the duties, obligations and liability imposed on such person as a member of the audit committee and board of directors in the absence of such designation or identification.ITEM 4.
        PRINCIPAL ACCOUNTANT FEES AND SERVICES
 DWS NEW YORK TAX-FREE INCOME FUND FORM N-CSR DISCLOSURE RE: AUDIT FEES The following table shows the amount of fees that Ernst & Young LLP (E&Y), the Funds Independent Registered Public Accountant, billed to the Fund during the Funds last two fiscal years.  The Audit Committee approved in advance all audit services and non-audit services that E&Y provided to the Fund. The Audit Committee has delegated certain pre-approval responsibilities to its Chairman (or, in his absence, any other member of the Audit Committee). Services that the Funds Independent Registered Public Accountant Billed to the Fund Fiscal YearEndedAugust 31,
        Audit Fees Billed to Fund
        Audit-RelatedFees Billed to Fund
        Tax Fees Billed to Fund
        AllOther Fees Billed to Fund2008
        $59,093
        $0
        $8,441
        $02007
        $46,742
        $0
        $6,374
        $0
  The above "Tax Fees" were billed for professional services rendered for tax return preparation.  
 Services that the Funds Independent Registered Public Accountant Billed to the Adviser and Affiliated Fund Service Providers The following table shows the amount of fees billed by E&Y to Deutsche Investment Management Americas, Inc. (DeIM or the Adviser), and any entity controlling, controlled by or under common control with DeIM (Control Affiliate) that provides ongoing services to the Fund (Affiliated Fund Service Provider), for engagements directly related to the Funds operations and financial reporting, during the Funds last two fiscal years.  Fiscal YearEndedAugust 31,
        Audit-RelatedFees Billedto Adviser and Affiliated Fund Service Providers
        Tax Fees Billed to Adviser and Affiliated Fund Service Providers
        AllOther Fees Billed to Adviser and Affiliated Fund Service Providers2008
        $0
        $382,000
        $02007
        $250,000
        $486,614
        $0
  The Audit-Related Fees were billed for services in connection with agreed upon procedures related to fund mergers and the above Tax Fees were billed in connection with tax compliance services and agreed upon procedures. Non-Audit Services The following table shows the amount of fees that E&Y billed during the Funds last two fiscal years for non-audit services. The Audit Committee pre-approved all non-audit services that E&Y provided to the Adviser and any Affiliated Fund Service Provider that related directly to the Funds operations and financial reporting. The Audit Committee requested and received information from E&Y about any non-audit services that E&Y rendered during the Funds last fiscal year to the Adviser and any Affiliated Fund Service Provider.  The Committee considered this information in evaluating E&Ys independence.  Fiscal YearEndedAugust 31,
        TotalNon-Audit Fees Billed to Fund
(A)
        Total Non-Audit Fees billed to Adviser and Affiliated Fund Service Providers (engagements related directly to the operations and financial reporting of the Fund)
(B)
        Total Non-Audit Fees billed to Adviser and Affiliated Fund Service Providers (all other engagements)
(C)
        Total of (A), (B)and (C)2008
        $8,441
        $382,000
        $1,474,733
        $1,865,1742007
        $6,374
        $486,614
        $1,519,326
        $2,012,314
   All other engagement fees were billed for services in connection with internal control reviews, agreed upon procedures and tax compliance for DeIM and other related entities that provide support for the operations of the fund.  *** 
 In connection with the audit of the 2007 and 2008 financial statements, the Fund entered into an engagement letter with E&Y.  The terms of the engagement letter required by E&Y, and agreed to by the Audit Committee, include provisions in which the parties consent to the sole jurisdiction of federal courts in New York, Boston or the Northern District of Illinois, as well as a waiver of right to a trial by jury and an exclusion of punitive damages.  *** E&Y advised the Funds Audit Committee that certain arrangements between the Ernst & Young member firm in Germany (E&Y Germany) and Deutsche Bank AG (DB) had been determined to be inconsistent with the SEC auditor independence rules.  DB is within the Investment Company Complex (as defined by SEC rules) and therefore covered by the SEC auditor independence rules applicable to the Fund.  In 2006 and 2007, DB provided standard overdraft protection on a depository account and a guarantee of certain lease deposits to E&Y Germany.  E&Y advised the Audit Committee that while neither of these arrangements was ever utilized by E&Y Germany, they could constitute lending type arrangements in violation of Rule 2-01 of Regulation S-X.  (Rule 2-01(c)(1)(ii)(A) provides that an accountant is not independent when an
accounting firm has a loan to or from an audit client.)  E&Y advised the Audit Committee that E&Y believes its independence has not been impacted as it relates to the audits of the Fund.  In reaching this conclusion, E&Y noted a number of factors, including that neither of the arrangements was ever utilized and, accordingly, E&Y Germany never had amounts outstanding to DB, these arrangements were immaterial to E&Y Germany and DB and the E&Y professionals responsible for the Funds audits were not aware of these arrangements.  E&Y informed the Audit Committee that E&Y Germany has cancelled the overdraft arrangements and has terminated the guarantee on the lease deposits.  ITEM 5.
        AUDIT COMMITTEE OF LISTED REGISTRANTSNot ApplicableITEM 6.
        SCHEDULE OF INVESTMENTSNot ApplicableITEM 7.
        DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIESNot applicable.ITEM 8.
        PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIESNot applicable.
  ITEM 9.
        PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERSNot Applicable.
  ITEM 10.
        SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERSThe primary function of the Nominating and Governance Committee is to identify and recommend individuals for membership on the Board and oversee the administration of the Board Governance Guidelines. Shareholders may recommend candidates for Board positions by forwarding their correspondence by U.S. mail or courier service to Chairman of the Board, P.O. Box 100176, Cape Coral, FL 33910.
  
  ITEM 11.
        CONTROLS AND PROCEDURES(a)          The Chief Executive and Financial Officers concluded that the Registrants Disclosure Controls and Procedures are effective based on the evaluation of the Disclosure Controls and Procedures as of a date within 90 days of the filing date of this report.(b)          There have been no changes in the registrants internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrants internal controls over financial reporting.ITEM 12.
        EXHIBITS(a)(1)     Code of Ethics pursuant to Item 2 of Form N-CSR is filed and attached hereto as EX-99.CODE ETH.(a)(2)     Certification pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)) is filed and attached hereto as Exhibit 99.CERT.(b)         Certification pursuant to Rule 30a-2(b) under the Investment Company Act of 1940 (17 CFR 270.30a-2(b)) is furnished and attached hereto as Exhibit 99.906CERT.


Form N-CSR Item F  SIGNATURES  Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.  Registrant:
        DWS New York Tax-Free Income Fund, a series of DWS State Tax-Free Income Series
  By:
        /s/Michael G. Clark
 Michael G. Clark
 President  Date:
        October 30, 2008
   Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.  Registrant:
        DWS New York Tax-Free Income Fund, a series of DWS State Tax-Free Income Series
  By:
        /s/Michael G. Clark
 Michael G. Clark
 President  Date:
        October 30, 2008
   By:
        /s/Paul Schubert
 Paul Schubert
 Chief Financial Officer and Treasurer  Date:
        October 30, 2008