UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K

[X]   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934
      for the fiscal year ended December 31, 2008

                                       OR

[ ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934
      for the transition period from     to

                        Commission File Number: 000-17202


                              GOVERNMENT TRUST 1-D
             (Exact name of registrant as specified in its charter)

         Illinois                                            36-6889513
(State or other jurisdiction of                           (I.R.S. Employer
incorporation or organization)                            Identification No.)

The Bank of New York Mellon Trust Company, N.A.
(formerly J.P. Morgan Trust Company, N.A.), Trustee
2 North LaSalle Street, Suite 1020
Chicago, Illinois                                               60602
(Address of Principal Executive Offices)                     (Zip Code)

       Registrant's telephone number, including area code: (312) 827-8617

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

        Securities registered pursuant to Section 12(g) of the Act:
                       Zero Coupon Certificates, Class 1-D

Indicate by check mark if the registrant is a well-known seasoned issuer, as
defined in Rule 405 of the Securities Act.  Yes [ ]  No [X]

Indicate by check mark if the registrant is not required to file reports
pursuant to Section 13 or Section 15(d) of the Act.  Yes [ ]  No [X]

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.  Yes [X]  No [ ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K (229.405 of this chapter) is not contained herein, and will
not be contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. Not Applicable.

Indicate by check mark whether the registrant is a large accelerated filer,
an accelerated filer, a non-accelerated filer, or a smaller reporting company.

See the definitions of "large accelerated filer," "accelerated filer" and
"smaller reporting company" in Rule 12b-2 of the Exchange Act.

       Large accelerated filer [ ]
       Accelerated filer   [ ]
       Non-accelerated filer [X] (Do not check if a smaller reporting company)
       Smaller reporting company [ ]

Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Act).  Yes [ ]  No [X]

State the aggregate market value of the voting and non-voting common equity held
by non-affiliates  computed by reference to the price at which the common equity
was last sold, or the average bid and asked price of such common  equity,  as of
the last business day of the registrant's most recently  completed second fiscal
quarter.  Not Applicable

Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date.  Not Applicable

                      DOCUMENTS INCORPORATED BY REFERENCE

List hereunder the following documents if incorporated by reference and the part
of the Form 10-K (e.g., Part I, Part II, etc.) into which the document is
incorporated:   (1  Any  annual  report  to  security  holders;  (2)  Any  proxy
information statement;  and, (3) Any prospectus filed pursuant to Rule 424(b) or
(c) under the  Securities Act of 1933.  The listed  documents  should be clearly
described for identification  purposes (e.g.,  annual report to security holders
for fiscal year ended date December 24, 1980).    None



<PAGE>

                                     PART I

Item 1.  Business.

         Not Applicable.

Item 1A. Risk Factors.

         Not Applicable.

Item 1B. Unresolved Staff Comments.

         None.

Item 2.  Properties.

         Not Applicable.

Item 3.  Legal Proceedings.

         None.

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

         None.

                                    PART II

Item 5.  Market for Registrant's Common Equity,  Related Stockholder Matters
         and Issuer Purchases of Equity Securities.

         Certificate Holders as of December 31, 2008, Trust 1-D: 1064.

Item 6.  Selected Financial Data.

         Not Applicable.

Item 7.  Management's Discussion and Analysis of Financial Condition and
         Results of Operations.

         Not Applicable.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk.

         Not Applicable.

Item 8.  Financial Statements and Supplementary Data.

         See Item 15. Exhibits, Financial Statement Schedules.

Item 9.  Changes in and Disagreements with Accountants on Accounting and
         Financial Disclosure.

         None.

Item 9A. Controls and Procedures.

         As of the end of the period covered by this report, an evaluation was
         carried  out by Lawrence M. Kusch,  Assistant  Vice  President  of the
         Trustee,  of the effectiveness of the Trust's disclosure  controls and
         procedures as defined in Exchange Act Rules  13a-15(e) and  15d-15(e).
         Based  on that  evaluation,  Mr.  Kusch  concluded  that  the  Trust's
         disclosure   controls  and  procedures  were  effective  because  such
         controls and  procedures did ensure that a report by management on the
         Trust's  internal  control  over  financial  reporting  as  defined in
         Exchange Act Rules 13a-15(f) and 15d-15(f) was included in the Trust's
         Form 10-K for the year 2008. Such report appears below.

         Management  of the  Trustee is  responsible  for  establishing  and
         maintaining adequate internal control over financial reporting for the
         Trust,  as such term is defined in Exchange  Act Rules  13a-15(f)  and
         15d-15(f). Management of the Trustee has assessed the effectiveness of
         the Trust's internal  control over financial  reporting as of December
         31,  2008.  In making this  assessment,  management  used the criteria
         established in Internal  Control - Integrated  Framework issued by the
         Committee of  Sponsoring  Organizations  of the  Treadway  Commission.
         Based upon such  assessment,  management of the Trustee believes that,
         as of December 31, 2008, the Trust's  internal  control over financial
         reporting is effective based upon those  criteria.  This annual report
         does not  include  an  attestation  report of the  Trust's  registered
         public  accounting  firm  regarding  internal  control over  financial
         reporting.  Management's  report was not subject to attestation by the
         Trust's  registered public accounting firm pursuant to temporary rules
         of the  Securities  and Exchange  Commission  that permit the Trust to
         provide only management's report in this annual report.

         There have not been any changes in the Trust's internal controls and
         procedures  for  financial  reporting  as defined in Exchange Act Rule
         13a-15(f)  and 15d-15(f)  during the fourth  quarter of 2008 that have
         materially  affected,  or are reasonably likely to materially  affect,
         the Trust's internal control over financial reporting.

Item 9B. Other Information.

         None.


                                    PART III

Item 10. Directors, Executive Officers and Corporate Governance.

         Not Applicable.

Item 11. Executive Compensation.

         Not Applicable.

Item 12. Security Ownership of Certain Beneficial Owners and Management and
         Related Stockholder Matters.

         Not Applicable.

Item 13. Certain Relationships and Related Transactions, and Director
         Independence.

         None.

Item 14. Principal Accounting Fees and Services.

         Deloitte & Touche LLP 2008 Audit Expense = $26,459.73


                                    PART IV

Item 15. Exhibits, Financial Statement Schedules.

         The following documents are filed as part of this report:

         (1)   The information presented in each semi-annual report.

         (2)   The report of the  independent registered  public accounting firm
               regarding  the annual audit of the  financial  statements  of the
               Trust  required  under  the  Declaration  of  Trust  stating  the
               financial  statements are presented in accordance with accounting
               principles generally accepted in the United States of America.

         (3)   Exhibits:

               31.1    Certification  by  Trustee  pursuant  to  Rule 13a-14  or
                       15d-14 of the Securities Exchange Act of 1934, as adopted
                       pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

               32.1    Certification by Trustee pursuant to Section 906 of the
                       Sarbanes-Oxley Act of 2002
<PAGE>

SIGNATURE

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934,  the  registrant  has duly  caused  this report to be signed on its
behalf by the undersigned, thereunto duly authorized.


               GOVERNMENT TRUST 1-D

          By:  The Bank of New York Mellon Trust Company, N.A.
               (formerly J.P. Morgan Trust Company, N.A.)
               Not in its individual capacity but solely
               as Trustee on behalf of the Government Trust 1-D


          By:  /s/ Lawrence M. Kusch
               -----------------------------------------
        Name:  Lawrence M. Kusch
       Title:  Assistant Vice President

        Date:  March 30, 2009



<PAGE>



                     REPORTS TO HOLDERS OF GOVERNMENT TRUST
                                  May 15, 2008


                                        The Bank of New York Trust Company, N.A.
                                        2 N LaSalle Street, Suite 1020
                                        Chicago, IL 60602
                                        1-800-254-2826

                                        May 15, 2008


To The Holders of
Government Trust Certificates
Zero Coupon Class 1-D



In accordance with Section 4.1 of the Declaration of Trust ("Trust"), The Bank
of New York Trust Company, N.A. (formerly J.P. Morgan Trust Company, N.A.), as
Trustee and not in its individual capacity ("Trustee"), hereby provides the
holders of the above-mentioned certificates this Semi-annual Report relating to
the May 15, 2008 Certificate Payment Date.

Any capitalized terms used herein shall have the meaning assigned to them in the
Trust.

1.   The aggregate dollar amount distributed to holders of Class 1-D
     Certificates: $119,602,177.75

2.   The Principal Balance of the Class 1-D Note after the May 5, 2008
     Note Payment Date: $519,296,000.00

3.   The Deficient amount of the Note Payment:  $-0-

Neither a delinquency in payment under any of the Notes nor an Event of Default
has occurred and is continuing.

I, Lawrence M. Kusch, a Responsible Officer of the Trustee, to the best of my
knowledge and belief, certify that this Semi-annual Report is complete and
accurate. If you have any questions regarding this notice please contact our
Customer Service group directly at (800) 275-2048 for further assistance.


                                 /s/ Lawrence M. Kusch
                                 -------------------------
                                 Lawrence M. Kusch
                                 AVP, Relationship Manager

                                 For The Bank of New York Trust Company, N.A.
                                 (formerly J.P. Morgan Trust Company, N.A.), as
                                 Trustee and not in its individual capacity.

<PAGE>

                     REPORTS TO HOLDERS OF GOVERNMENT TRUST
                                November 17, 2008


                                        2 N LaSalle Street, Suite 1020
                                        Chicago, IL 60602

                                        November 17, 2008


To The Holders of
Government Trust Certificates
Zero Coupon Class 1-D

To The Holders of
Government Trust Certificates
Zero Coupon Class 1-D


In accordance with Section 4.1 of the Declaration of Trust  ("Trust"),  The Bank
of New York Mellon Trust  Company,  N.A.  (formerly  J.P.  Morgan Trust Company,
N.A.),  as  Trustee  and  not in its  individual  capacity  ("Trustee"),  hereby
provides the holders of the above-mentioned certificates this Semi-annual Report
relating to the November 17, 2008 Certificate Payment Date.

Any capitalized terms used herein shall have the meaning assigned to them in the
Trust.

1.   The aggregate dollar amount distributed to holders of Class 1-D
     Certificates: $118,993,224.00

2.   The Principal Balance of the Class 1-D Note after the November 3, 2008
     Note Payment Date: $425,586,000.00

3.   The Deficient amount of the Note Payment:  $-0-

Neither a delinquency in payment under any of the Notes nor an Event of Default
has occurred and is continuing.

I, Lawrence M. Kusch, a Responsible Officer of the Trustee, to the best of my
knowledge and belief, certify that this Semi-annual Report is complete and
accurate. If you have any questions regarding this notice please contact our
Customer Service group directly at (800) 275-2048 for further assistance.


                           /s/ Lawrence M. Kusch
                           -------------------------
                           Lawrence M. Kusch
                           AVP, Relationship Manager

                           For The Bank of New York Mellon Trust Company, N.A.
                           (formerly J.P. Morgan Trust Company, N.A.), as
                           Trustee and not in its individual capacity.


<PAGE>


GOVERNMENT TRUST 1-D

Financial Statements as of and for the
Year Ended December 31, 2008 and Report of
Independent Registered Public Accounting Firm
----------------------------------------------

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Government Trust 1-D

We have audited the accompanying balance sheet of Government Trust 1-D (the
"Trust") as of December 31, 2008, and the related statements of income, cash
flows and changes in Trust balance for the year then ended. These financial
statements are the responsibility of the Trust's management. Our responsibility
is to express an opinion on these financial statements based on our audit.

We conducted our audit 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 are free of material misstatement. The Trust is not required to have,
nor were we engaged to perform, an audit of its internal control over financial
reporting. Our audit 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 Trust'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, assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. Our procedures included confirmation of the securities held by the
Depository as of December 31, 2008 for the account of the Government of Israel,
for the purpose described in Note 4 of the notes to financial statements, by
correspondence with the Depository. We believe that our audit provides a
reasonable basis for our opinion.

In our opinion, such financial statements present fairly, in all material
respects, the financial position of Government Trust 1-D at December 31, 2008,
the results of its operations, cash flows and changes in Trust balance for the
year then ended, in conformity with accounting principles generally accepted in
the United States of America.


/s/ Deloitte & Touche LLP
-------------------------
Chicago, Illinois
March 27, 2009


<PAGE>

GOVERNMENT TRUST 1-D

BALANCE SHEET
AS OF DECEMBER 31, 2008
--------------------------------------

ASSETS

LOAN NOTE RECEIVABLE - at amortized cost,
   inclusive of unamortized premium of $1,112,498              $ 426,698,498

ACCRUED INTEREST RECEIVABLE                                        6,681,819
                                                               --------------

TOTAL                                                          $ 433,380,317
                                                               ==============


LIABILITIES AND TRUST BALANCE

ACCRUED EXPENSES PAYABLE                                       $       5,141

TRUST BALANCE - Comprised of owners'
equity in Government Trust Certificates                          433,375,176
                                                               --------------

TOTAL                                                          $ 433,380,317
                                                               ==============

See notes to financial statements.


<PAGE>

GOVERNMENT TRUST 1-D

STATEMENT OF INCOME
FOR THE YEAR ENDED DECEMBER 31, 2008
--------------------------------------

INTEREST INCOME ON THE LOAN NOTE                                $ 51,174,102

TRUSTEE FEES AND OTHER EXPENSES                                      (39,973)
                                                               --------------
NET INCOME                                                      $ 51,134,129
                                                               ==============

See notes to financial statements.


<PAGE>

GOVERNMENT TRUST 1-D

STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 2008
--------------------------------------

CASH FLOWS FROM OPERATING ACTIVITIES:
 Principal and interest received on the loan note              $ 238,637,722
 Trustee fees and other expenses paid                                (42,320)
                                                               --------------
    Net cash provided by operating activities                    238,595,402
                                                               --------------
CASH FLOWS USED IN FINANCING ACTIVITIES -
 Distributions to certificate owners                            (238,595,402)
                                                               --------------

NET INCREASE IN CASH                                                       -

CASH BALANCE - Beginning of year                                           -
                                                               --------------
CASH BALANCE - End of year                                     $           -
                                                               ==============

RECONCILIATION OF NET INCOME TO NET CASH
 PROVIDED BY OPERATING ACTIVITIES:
  Net income                                                    $ 51,134,129
  Amortization of premium on loan note receivable                    765,347
  Decrease in loan note receivable                               183,650,000
  Decrease in accrued interest receivable                          3,048,273
  Decrease in accrued expenses                                        (2,347)
                                                               --------------
NET CASH PROVIDED BY OPERATING ACTIVITIES                      $ 238,595,402
                                                               ==============

See notes to financial statements.


<PAGE>

GOVERNMENT TRUST 1-D

STATEMENT OF CHANGES IN TRUST BALANCE
FOR THE YEAR ENDED DECEMBER 31, 2008
--------------------------------------


Trust Balance,                          Distributions to       Trust Balance,
January 1, 2008        Net Income       Certificate Owners     December 31, 2008

$   620,836,449      $   51,134,129     $    (238,595,402)     $    433,375,176
===============      ==============     ==================     =================


See notes to financial statements.



<PAGE>

GOVERNMENT TRUST 1-D

NOTES TO FINANCIAL STATEMENTS
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 2008
----------------------------------------------

1 .   ORGANIZATION AND OPERATIONS

      Government Trust 1-D (the "Trust") is a limited purpose trust established
      under the laws of the state of Illinois pursuant to a Declaration of Trust
      (the "Declaration") between the Trust and The Bank of New York Mellon
      Trust Company, N.A. (formerly, The Bank of New York Trust Company, N.A.,
      formerly, JPMorgan Trust Company, N.A., formerly, Bank One Trust Company,
      N.A., formerly, First National Bank of Chicago), as Trustee (the
      "Trustee"). The Trust was created for the sole purpose of the issuance and
      sale of a single class of Zero Coupon Certificates (the "Certificates").
      The assets of the Trust consist of a Promissory Note (a "Loan Note") from
      the Government of Israel ("Israel"). The Loan Note is backed by a full
      faith and credit guaranty (the "Guaranty") issued by the United States of
      America, acting through the Defense Security Assistance Agency of the
      Department of Defense (the DSA), of the due and punctual payment of 90% of
      all payments of principal and interest due on the Loan Note (the
      "Guaranteed Portion") and a security interest in certain collateral,
      consisting of non-callable securities issued or guaranteed by the United
      States Government, sufficient to pay the remaining 10% of all payments of
      principal and interest due on the Loan Note (the "Unguaranteed Secured
      Portion"). The Loan Note and Certificates will not be subject to
      prepayment or acceleration.


2.    LOAN NOTE RECEIVABLE

      The Loan Note in the original principal amount of $1,300,000,000 evidences
      a loan made by the Trust to Israel subject to the terms and conditions of
      a Loan Agreement (the "Loan Agreement") dated as of September 29, 1988,
      between the Trust and Israel. The Loan Note is carried at amortized cost
      on the accompanying Balance Sheet because of the Trust's intent and
      ability to hold the Loan Note to maturity. The proceeds from the Loan Note
      were used to prepay certain loans made to Israel from the Federal
      Financing Bank. Semi-annual payments of interest at an annual rate of
      9.7450% are due on the Loan Note on each May 3 and November 3 (each a
      "Note Payment Date"). On May 3, 2008 and November 3, 2008 Note Payment
      Dates, Israel made its scheduled payments of principal on the Loan Note in
      the amounts of $89,940,000 and $93,710,000, respectively. Scheduled
      principal payments are due on each Note Payment Date as follows:

            Payment         Principal            Payment            Principal
             Date            Payment              Date               Payment

            May 3, 2009    $92,701,000      November 3, 2011       $29,248,000
       November 3, 2009     93,710,000           May 3, 2012        22,773,000
            May 3, 2010     41,800,000      November 3, 2012        16,877,000
       November 3, 2010     47,368,000           May 3, 2013        16,877,000
            May 3, 2011     47,368,000      November 3, 2013        16,864,000

      The Government of the United States, acting through the DSA, has agreed to
      guarantee the repayment of the Guaranteed Portion due to the Trust under
      the Loan Note. Israel has agreed to pledge certain collateral as security
      for the repayment of the Unguaranteed Secured Portion, as more fully
      described in Note 4. The estimated fair value of the Loan Note
      approximates the fair value of the Certificates. The estimated fair value
      of the Certificates at December 31, 2008 was approximately $495,053,000.
      The estimate of the fair value of the Certificates is based upon the
      present values of the cash flows using risk-adjusted spreads to the U.S.
      Treasury curve.

3.    THE ZERO COUPON CERTIFICATES

      On  September 29, 1988, the Trust issued 51 separate series of
      Certificates, Class 1-D. Thirty-nine of such series of Certificates
      matured prior to  December 31, 2007.  Each of the remaining series of
      Certificates will mature on one of the semiannual certificate payment
      dates from  May 15, 2008 to November 15, 2013 (each, a "Maturity
      Date"). Scheduled distributions are due on the Maturity Dates as follows:

            Maturity       Distribution          Maturity        Distribution
              Date            Amount               Date             Amount

            May 15, 2009   $113,421,718      November 15, 2011    $34,245,236
       November 15, 2009    109,917,338           May 15, 2012     26,346,224
            May 15, 2010     53,444,833      November 15, 2012     19,341,464
       November 15, 2010     56,977,695           May 15, 2013     18,519,765
            May 15, 2011     56,671,466      November 15, 2013     17,685,066

      Each of the Certificates evidences an undivided fractional interest in the
      Trust, and represents the right to receive a portion of the semi-annual
      payments due on the Loan Note held by the Trust.
<page>

4.    THE COLLATERAL

      In accordance with the Collateral Depository Agreement (the "Depository
      Agreement") between Israel, the Trustee, and The Bank of New York, as
      depository (the "Depository"), and in order to provide security for the
      payment of the Unguaranteed Secured Portion, Israel has pledged certain
      collateral, consisting of non-callable securities issued or guaranteed by
      the United States Government (together with the proceeds thereof, the
      "Collateral"). The Collateral is of such amounts and has such payment
      dates as to enable the Trustee to receive on or immediately prior to each
      semi-annual Maturity Date an amount sufficient to pay the Unguaranteed
      Secured Portion if timely payment on the Loan Note has not been received
      by the related Note Payment Date. All of the Collateral was deposited with
      the Depository on the date that the loans evidenced by the Loan Note were
      made by the Trust to Israel.

5.    THE TRUSTEE

      Pursuant to the Declaration, the Trustee established a separate trust
      account for the Trust. All payments received with respect to the Loan
      Note, the Guaranty and any relevant Collateral are deposited in the trust
      account for the benefit of the holders of the Certificates after deducting
      fees of the Trustee and any additional expenses of the Trust. Any excess
      funds remaining in the trust account after the payment of principal on the
      Certificates will revert back to Israel to the extent such funds were
      provided by Israel but not needed for the above purpose.

6.    INCOME TAXES

      The Trust is classified as a Grantor Trust and will not be subject to
      Federal income taxes. Each Certificate holder will be treated for Federal
      income tax purposes as the owner of a pro rata undivided fractional
      interest in the assets held by the Trust. The difference between the
      financial reporting and income tax bases of the Trust's assets and
      liabilities is not significant.

      In July 2006, the Financial Accounting Standards Board ("FASB") released
      Accounting for Uncertainty in Income Taxes ("FIN 48"), which is effective
      for fiscal years beginning after December 15, 2006. FIN 48 clarifies
      accounting for income taxes recognized in the financial statements in
      accordance with FASB Statement 109, Accounting for Income Taxes. This
      interpretation prescribes a comprehensive model for how an entity should
      recognize, measure, present and disclose in its financial statements
      uncertain tax positions that the entity has taken or expects to take on a
      tax return. The Trust adopted FIN 48 effective January 1, 2007 for all
      open tax years and has determined that no material uncertain tax positions
      exist. As a result, the Trust has not recorded any liabilities for
      material unrecognized tax benefits as of December 31, 2008.


                                     ******