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Pricing Supplement Dated July 10, 2003

(To Offering Circular dated January 23, 2003)

Universal Debt Facility

This Pricing Supplement relates to the Debt Securities described below (the "Notes"). You should read it together with the Offering Circular dated January 23, 2003 (the "Offering Circular"), relating to the Universal Debt Facility of the Federal National Mortgage Association ("Fannie Mae"). Unless defined below, capitalized terms have the meanings we gave to them in the Offering Circular.

The Notes, and interest thereon, are not guaranteed by the United States and do not constitute a debt or obligation of the United States or of any agency or instrumentality thereof other than Fannie Mae.

Certain Securities Terms

1. Title: Fixed/Variable Rate Notes Due July 28, 2008

2. Form: Fed Book-Entry Securities

3. Specified Payment Currency

a. Interest: U.S. dollars

b. Principal: U.S. dollars

4. Aggregate Original Principal Amount: $50,000,000.00

5. Issue Date: July 28, 2003

6. Maturity Date: July 28, 2008

Amount Payable on the Maturity Date: 100.00% of principal amount

7. Subject to Redemption Prior to Maturity Date

__ No

X Yes; in whole or in part, at our option, on January 28, 2004 at a redemption price of 100% of the principal amount redeemed, plus accrued interest thereon to the date of redemption

8. Interest Category: Fixed/Variable Rate Securities

9. Interest

a. Frequency of Interest Payments: semiannually

b. Interest Payment Dates: the 28th day of each January and July

c. First Interest Payment Date: January 28, 2004

d. Interest Rate Determination:

(1) Interest Rate for the period from and including July 28, 2003 to but excluding January 28, 2004:

(a) Interest Rate Formula (as more fully described below):

LIBOR plus 0.50%

(b) Index: LIBOR

(i) Index Currency: U.S. dollars

(ii) Index Maturity: six month

(d) Multiplier: N/A

(e) Initial Interest Rate: N/A

(f) Reset Frequency: semiannually

(g) Reset Dates: 28th day of each January and July

(h) First Reset Date: July 28, 2003

(i) Determination Dates (if other than as described for the applicable index in the Offering Circular): N/A

(j) Maximum interest rate limitation: 24.00% per annum

(k) Minimum interest rate limitation: 0.00% per annum

(l) Accrual method (i.e., day count convention): 30/360

(m) Initial Calculation Agent: Fannie Mae

(2) Interest Rate for the period rom and including January 28, 2004 to but excluding July 28, 2008: 3.75%

Additional Information Relating to the Notes

1. Identification Number(s)

a. CUSIP: 3136F3W69

b. ISIN: N/A

c. Common Code: N/A

2. Listing Application

X No

__ Yes

3. Eligibility for Stripping on the Issue Date

X No

__ Yes

___ Minimum Principal Amount: _____________

4. Additional Tax Information: See Annex 1

Offering

1. Pricing Date: July 10, 2003

2. Method of Distribution: X Principal __ Non-underwritten

3. Dealer: J.P. Morgan Securities Inc.

4. Offering Price:

X Fixed Offering Price: 100.00% of principal amount, plus accrued interest, if any, from the Settlement Date

__ Variable Price Offering

5. Dealer Purchase Price: 99.95% of principal amount

a. Concession: N/A

b. Reallowance: N/A

6. Proceeds to Fannie Mae: $49,975,000.00

Settlement

1. Settlement Date: July 28, 2003

2. Settlement Basis: delivery versus payment

3. Settlement Clearing System: U.S. Federal Reserve Banks

ANNEX 1
To Pricing Supplement dated July 10, 2003
Issue: $50,000,000 Fixed/Variable Rate Notes Due July 28, 2008

The Notes and payments thereon generally are subject to taxation. Therefore, you should consider the tax consequences of owning and receiving payments on a Note before acquiring one.

The following discussion supplements the discussion under the caption “United States Taxation” in the Offering Circular. We have engaged Dewey Ballantine LLP as special tax counsel to review these discussions. They have given us their written legal opinion that, when read together, the two discussions correctly describe the principal U.S. federal income tax consequences applicable to beneficial owners of the Notes. These two discussions do not purport to deal with all U.S. federal tax consequences applicable to all categories of beneficial owners, some of which may be subject to special rules. In addition, these discussions may not apply to your particular circumstances for one of the reasons explained in the Offering Circular. You should consult your own tax advisors regarding the U.S. federal income tax consequences of purchasing, owning and disposing of Notes as well as any tax consequences arising under the laws of any state, local or foreign taxing jurisdiction.

Treatment of the Notes Under the OID Regulations

The Notes will qualify as “variable rate debt instruments” (VRDIs) under the OID Regulations. The rules applicable to VRDIs generally require that, for OID purposes, a VRDI be treated as an equivalent fixed rate debt instrument. For this purpose, the rules assume a fixed rate substitute for each variable rate equal to the value of the variable rate index as of the issue date of the VRDI. Based on our assumption of the value of the applicable variable rate index for the Notes as of the issue date of the Notes and taking into account the actual fixed rate payable on the Notes, the Notes for OID purposes ordinarily would be treated as paying one fixed rate of interest for one or more periods and as paying a higher fixed rate of interest for subsequent periods. The date the higher fixed rate becomes effective coincides with the date that we may redeem (“call”) the Notes. The OID Regulations contain additional rules that apply to Debt Securities, such as the Notes, that we may redeem before their final maturity. See “United States Taxation – U.S. Persons -- Debt Securities That We May Redeem Before Maturity” in the Offering Circular. Under these rules, we will be presumed, solely for OID purposes, to exercise the call right with respect to the Notes, because doing so would lower the yield to maturity of the Notes. If we do not exercise the call right, the Notes will be deemed to be retired and reissued at the call price for purposes of determining subsequent accruals of interest and OID. As a result of these rules, the Notes will not have OID solely as a result of the structure of their interest rates, because the Notes will not be treated as bearing interest at more than one fixed rate.