<TABLE> <S> <C>

<ARTICLE> 6
<CIK> 0000764624
<NAME> SMITH BARNEY INCOME FUNDS
<SERIES>
   <NUMBER> 10
   <NAME> DIVERSIFIED STRATEGIC INCOME FUND, CLASS Z
       
<S>                             <C>
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          JUL-31-1997
<PERIOD-END>                               JUL-31-1997
<INVESTMENTS-AT-COST>                    2,958,029,403
<INVESTMENTS-AT-VALUE>                   3,025,560,107
<RECEIVABLES>                              287,681,729
<ASSETS-OTHER>                                       0
<OTHER-ITEMS-ASSETS>                                 0
<TOTAL-ASSETS>                           3,313,241,836
<PAYABLE-FOR-SECURITIES>                   306,801,256
<SENIOR-LONG-TERM-DEBT>                              0
<OTHER-ITEMS-LIABILITIES>                  114,634,978
<TOTAL-LIABILITIES>                        421,436,234
<SENIOR-EQUITY>                                      0
<PAID-IN-CAPITAL-COMMON>                 2,885,971,116
<SHARES-COMMON-STOCK>                        2,545,737
<SHARES-COMMON-PRIOR>                        2,080,516
<ACCUMULATED-NII-CURRENT>                      946,253
<OVERDISTRIBUTION-NII>                               0
<ACCUMULATED-NET-GAINS>                   (76,038,767)
<OVERDISTRIBUTION-GAINS>                             0
<ACCUM-APPREC-OR-DEPREC>                    80,927,000
<NET-ASSETS>                             2,891,805,602
<DIVIDEND-INCOME>                            5,810,138
<INTEREST-INCOME>                          223,385,797
<OTHER-INCOME>                                       0
<EXPENSES-NET>                              40,328,855
<NET-INVESTMENT-INCOME>                    188,867,080
<REALIZED-GAINS-CURRENT>                    53,421,481
<APPREC-INCREASE-CURRENT>                   45,383,904
<NET-CHANGE-FROM-OPS>                       98,805,385
<EQUALIZATION>                                       0
<DISTRIBUTIONS-OF-INCOME>                    1,572,522
<DISTRIBUTIONS-OF-GAINS>                             0
<DISTRIBUTIONS-OTHER>                                0
<NUMBER-OF-SHARES-SOLD>                        440,488
<NUMBER-OF-SHARES-REDEEMED>                    173,274
<SHARES-REINVESTED>                            198,007
<NET-CHANGE-IN-ASSETS>                     224,196,157
<ACCUMULATED-NII-PRIOR>                     18,374,484
<ACCUMULATED-GAINS-PRIOR>                (115,447,984)
<OVERDISTRIB-NII-PRIOR>                              0
<OVERDIST-NET-GAINS-PRIOR>                           0
<GROSS-ADVISORY-FEES>                       12,546,980
<INTEREST-EXPENSE>                                   0
<GROSS-EXPENSE>                             40,328,855
<AVERAGE-NET-ASSETS>                        18,096,873
<PER-SHARE-NAV-BEGIN>                             7.82
<PER-SHARE-NII>                                   0.60
<PER-SHARE-GAIN-APPREC>                           0.28
<PER-SHARE-DIVIDEND>                              0.69
<PER-SHARE-DISTRIBUTIONS>                            0
<RETURNS-OF-CAPITAL>                                 0
<PER-SHARE-NAV-END>                               8.01
<EXPENSE-RATIO>                                   0.69
<AVG-DEBT-OUTSTANDING>                               0
<AVG-DEBT-PER-SHARE>                                 0
        


</TABLE>