UNITEDSTATES
SECURITIESANDEXCHANGECOMMISSION
Washington,D.C.20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES

Investment Company Act file number 811-10339

Name of Fund: BlackRock Municipal Income Trust (BFK)

Fund Address: 100 Bellevue Parkway, Wilmington, DE 19809

Name and address of agent for service: John M. Perlowski, Chief Executive Officer, BlackRock
Municipal Income Trust, 55 East 52^nd Street, New York, NY 10055

Registrant’s telephone number, including area code: (800) 882-0052, Option 4

Date of fiscal year end: 04/30/2011

Date of reporting period: 04/30/2011

Item 1 – Report to Stockholders

---

April 30, 2011

Annual Report

BlackRock Investment Quality Municipal Trust Inc. (BKN)

BlackRock Long-Term Municipal Advantage Trust (BTA)

BlackRock Municipal 2020 Term Trust (BKK)

BlackRock Municipal Income Trust (BFK)

BlackRock Pennsylvania Strategic Municipal Trust (BPS)

BlackRock Strategic Municipal Trust (BSD)

Not FDIC Insured • No Bank Guarantee • May Lose Value

---

 

 

---

Dear Shareholder

Time and again, we have seen how various global events and developing trends can have significant influence on financial markets. I hope you find
that the following review of recent market conditions provides additional perspective on the performance of your investments as you read this
shareholder report.

Over the past 12 months, we have seen a sluggish, stimulus-driven economic recovery at long last gain real traction, accelerate, and transition into
a consumption-driven expansion. For the most part, 2010 was plagued with widely fluctuating economic data, but as the year drew to a close, it
became clear that cyclical stimulus had beaten out structural problems as economic data releases generally became more positive and financial
markets showed signs of continuing improvement. Although the sovereign debt crisis in Europe and high inflation in developing markets that troubled
the global economy in 2010 remain challenges today, overall investor confidence has improved considerably. During the first four months of 2011,
that confidence was shaken by political turmoil in the Middle East/North Africa region, soaring prices of oil and other commodities, tremendous natural
disasters in Japan and a change in the ratings outlook for US debt. However, strong corporate earnings prevailed and financial markets resumed their
course while the global economy continued to garner strength.

Equity markets experienced uneven growth and high volatility in 2010, but ended the year with gains. Following a strong start to 2011, the series of
confidence-shaking events brought spurts of heightened volatility to markets worldwide, but was not enough to derail the bull market. Overall, global
equities posted strong returns over the past 12 months. Emerging market equities, which had outperformed developed markets earlier in the period,
fell prey to heightened inflationary pressures and underperformed developed markets later in the period. In the United States, strong corporate earnings
and positive signals from the labor market were sources of encouragement for equity investors, although the housing market did not budge from its slump.
Early in 2011, the US Federal Reserve announced that it would continue its Treasury purchase program (“QE2”) through to completion and keep interest
rates low for an extended period. This compelled investors to continue buying riskier assets, furthering the trend of small cap stocks outperforming
large caps.

While fixed income markets saw yields trend lower (pushing bond prices higher) through most of 2010, the abrupt reversal in investor sentiment and risk
tolerance in the fourth quarter drove yields sharply upward. Global credit markets were surprisingly resilient in the face of recent headwinds and yields
regained relative stability as the period came to a close. Yield curves globally remained steep by historical standards and higher-risk sectors continued to
outperform higher-quality assets. The tax-exempt municipal market enjoyed a powerful rally during the period of low yields in 2010, but when that trend
reversed, the market was dealt an additional blow as it became evident that the Build America Bond program would not be extended. Meanwhile, munici-
pal finance troubles raised credit concerns among investors and tax-exempt mutual funds experienced heavy outflows, resulting in wider spreads and
falling prices. The new year brought relief from these headwinds and a steady rebound in the tax-exempt municipal market.

Cash investments, as represented by the 3-month Treasury bill, returned only a fraction over 0% for the 12-month period as short-term interest rates
remained low. Yields on money market securities remain near all-time lows.

 

While no one can peer into a crystal ball and eliminate the uncertainties presented by the economic landscape and financial markets, BlackRock can
offer investors the next best thing: partnership with the world’s largest asset management firm that delivers consistent long-term investment results with
fewer surprises. For additional market perspective and investment insight, visit www.blackrock.com/shareholdermagazine, where you’ll find the most
recent issue of our award-winning Shareholder® magazine, as well as its quarterly companion newsletter, Shareholder Perspectives.
As always, we thank you for entrusting BlackRock with your investments, and we look forward to your continued partnership in the months and
years ahead.

 

---

Municipal Market Overview

For the Period Ended April 30, 2011

Twelve months ago, the municipal yield curve was much flatter than it is today, as investor concerns were focused on the possibility of deflation and a
double-dip in the US economy. From April through September 2010, rates moved lower (and prices higher) across the curve, reaching historic lows in
August when the yield on 5-year issues touched 1.06%, the 10-year reached 2.18%, and the 30-year was 3.67%. The market took a turn in October, with
yields drifting higher (and prices lower) amid a “perfect storm” of events that ultimately resulted in the worst quarterly performance the municipal market
had seen since the Fed tightening cycle of 1994. Treasury yields lost their support as concerns over the US deficit raised the question whether foreign
investors would continue to purchase Treasury securities at historically low yields. Municipal valuations also suffered a quick and severe setback as it
became evident that the Build America Bond (“BAB”) program would expire at the end of 2010. The program opened the taxable market to municipal
issuers, which had successfully alleviated supply pressure in the traditional tax-exempt marketplace, bringing down yields in that space.

The financial media has been replete with interviews, articles and presentations depicting the stress experienced in municipal finance. This has resulted in a
loss of confidence among retail investors, the traditional buyers of individual municipal bonds and mutual funds. From the middle of November through
year-end, mutual funds specializing in tax-exempt bonds witnessed weekly outflows averaging over $2.5 billion. Long-term and high-yield funds saw the
greatest redemptions, followed by state-specific funds at a slower, yet still significant, pace. Political uncertainty surrounding the midterm elections and the
approach taken by the new Congress on issues such as income tax rates, alternative minimum tax and the previously mentioned BAB expiration exacer-
bated the situation. All these conditions, combined with the seasonal illiquidity surrounding year-end holidays and dealers closing their fiscal books, sapped
willing market participation from the trading community. December brought declining demand for municipal securities with no comparable reduction in sup-
ply. As it became evident that the BAB program would be retired, issuers rushed deals to market in the taxable and, to a lesser degree, traditional tax-
exempt space. This imbalance in the supply/demand technicals provided the classic market reaction: wider quality spreads and higher bond yields.

Demand usually is strong at the beginning of a new year, but retail investors continued to move away from municipal mutual funds, with AMG Data Services
showing $19.9 billion of redemptions in the first four months of 2011. Since mid-November, outflows persisted for 24 consecutive weeks, totaling $33.4
billion. Fortunately, lower supply in 2011 is offsetting the decline in demand. According to Thomson Reuters, through April, year-to-date new issuance was
down 53% compared to the same period last year. Issuers have been reluctant to bring new deals to the market due to a number of factors, including
higher interest rates, fiscal policy changes and a reduced need for municipal borrowing given the acceleration of some issuance into 2010 prior to the BAB
program’s expiration. Accordingly, estimates for 2011 issuance have ratcheted down more than $100 billion since the beginning of the year, when the initial
consensus was $350 billion.

Overall, the municipal yield curve steepened during the period from April 30, 2010 to April 30, 2011. As measured by Thomson Municipal Market Data, 30-
year yields on AAA-rated municipals rose 53 basis points (“bps”) to 4.58%, while yields for 5-year maturities rallied by 22 bps to 1.50%, and 10-year
maturities rallied by 9 bps to 2.85%. With the exception of the 2- to 5-year range, the spread between maturities increased over the past year, with the
greatest increase seen in the 5- to 30-year range, where the spread widened by 75 bps, while overall the slope between 2- and 30-year maturities
increased by 66 bps to 402 bps.

The fundamental picture for municipalities will be subject to scrutiny for months to come, as the challenges to state and local budgets are real and need to
be addressed with significant cuts to expenses and tax revenue increases. The debates around austerity measures needed to succeed in balancing these
budgets are not over whether action needs to be taken, but over the magnitude, approach and political will to accomplish these needs. The heightened
attention on municipal finance has the potential to improve this market for the future, especially if these efforts result in greater means toward disclosure
and accuracy (and timeliness) of reporting. Progress toward these fundamental changes may be tested in the near future, as California, Illinois and Puerto
Rico will soon need to take austerity measures and access financing in the municipal market to address immediate-term fiscal imbalances before their new
fiscal year begins in July. As the economy improves, tax receipts for states are rising and have begun to exceed budget projections. BlackRock maintains a
constructive view of the municipal market as we look beyond the interim challenges faced by states working to close their June 30 year-end shortfalls.

 

---

Trust Summary as of April 30, 2011 BlackRock Investment Quality Municipal Trust Inc

Trust Overview

BlackRock Investment Quality Municipal Trust Inc.’s (BKN) (the “Trust”) investment objective is to provide high current income exempt from regular federal
income tax consistent with the preservation of capital. The Trust seeks to achieve its investment objective by investing at least 80% of its assets in municipal
obligations exempt from federal income taxes (except that the interest may be subject to the federal alternative minimum tax). Under normal market condi-
tions, the Trust invests at least 80% of its assets in securities rated investment grade at the time of investment. The Trust may invest directly in such securi-
ties or synthetically through the use of derivatives.

No assurance can be given that the Trust’s investment objective will be achieved.

Performance

For the 12 months ended April 30, 2011, the Trust returned (0.61)% based on market price and 0.49% based on net asset value (“NAV”). For the same
period, the closed-end Lipper General Municipal Debt Funds (Leveraged) category posted an average return of (0.60)% based on market price and 0.10%
based on NAV. All returns reflect reinvestment of dividends. The Trust's premium to NAV, which narrowed during the period, accounts for the difference
between performance based on price and performance based on NAV. The following discussion relates to performance based on NAV. The Trust’s largest
exposure was in the tax-backed sector, which was among the strongest performing sectors during the period, driving the Trust’s positive performance. Also
beneficial were the Trust’s significant allocations to the corporate sector and pre-refunded debt, as those sectors exhibited strength. Detracting from perform
ance was the Trust’s exposure to the long end of the yield curve as interest rates rose during the period. While the Trust’s holdings of long duration bonds
(those with greater sensitivity to interest rates) and longer maturity bonds provided a higher level of yield, they underperformed shorter-dated securities in
the rising interest rate environment. The Trust’s overexposure to the underperforming health care sector and underexposure to the strong-performing housing
sector also had a negative impact. The Trust uses interest rate futures contracts to hedge portfolio risk related to movements in interest rates. This strategy
had a modestly negative impact on performance during the period.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These
views are not intended to be a forecast of future events and are no guarantee of future results.

¹ Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.
² Tax equivalent yield assumes the maximum federal tax rate of 35%.
³ The distribution rate is not constant and is subject to change.
⁴ Represents Auction Market Preferred Shares (“Preferred Shares”) and tender option bond trusts (“TOBs”) as a percentage of total managed assets, which is the total assets of the
Trust, including any assets attributable to Preferred Shares and TOBs, minus the sum of accrued liabilities. For a discussion of leveraging techniques utilized by the Trust, please see
The Benefits and Risks of Leveraging on page 11.

The table below summarizes the changes in the Trust’s market price and NAV per share:

 

The following charts show the sector and credit quality allocations of the Trust’s long-term investments:

 

⁵ Using the higher of Standard & Poor’s (“S&P’s”) or Moody’s Investors Service
(“Moody’s”) ratings.
⁶ The investment advisor has deemed certain of these securities to be of investment
grade quality. As of April 30, 2011 and April 30, 2010, the market value of these
securities was $8,694,533 representing 2% and $17,071,058 representing 5%,
respectively, of the Trust’s long-term investments.

 

---

Trust Summary as of April 30, 2011 BlackRock Long-Term Municipal Advantage Trust

Trust Overview

BlackRock Long-Term Municipal Advantage Trust’s (BTA) (the “Trust”) investment objective is to provide current income exempt from regular federal income
tax. The Trust seeks to achieve its investment objective by investing, under normal market conditions, at least 80% of its assets in municipal obligations and
derivative instruments with exposure to such municipal obligations, in each case that are exempt from federal income tax (except that the interest may be
subject to the federal alternative minimum tax). The Trust has economic exposure to additional municipal bonds through its ownership of residential interest
in tender option bonds, which are rated investment quality. The Trust invests, under normal market conditions, primarily in long-term municipal bonds with a
maturity of more than ten years at the time of investment and, under normal market conditions, the Trust's municipal bond portfolio will have a dollar-
weighted average maturity of greater than 10 years. The Trust may invest directly in such securities or synthetically through the use of derivatives.

No assurance can be given that the Trust’s investment objective will be achieved.

Performance

For the 12 months ended April 30, 2011, the Trust returned 1.37% based on market price and (0.18)% based on NAV. For the same period, the closed-
end Lipper General Municipal Debt Funds (Leveraged) category posted an average return of (0.60)% based on market price and 0.10% based on NAV.
All returns reflect reinvestment of dividends. The Trust's discount to NAV, which narrowed during the period, accounts for the difference between performance
based on price and performance based on NAV. The following discussion relates to performance based on NAV. As interest rates rose and the yield curve
steepened in the later part of the reporting period, the Trust’s holdings of longer-dated bonds had a negative impact on performance. The Trust’s high expo-
sure to the health care sector and low exposure to tax-backed issues in the Far West and Mid-Atlantic regions also detracted. Contributing positively to
performance were security selection and sector allocation among corporates and transportation as well as tax-backed issues in the Great Lakes region.
Additional benefits were derived from portfolio holdings with shorter remaining terms to their maturity, which exhibited lower price volatility compared to
longer-dated bonds during the period. The Trust uses interest rate futures contracts to hedge portfolio risk related to movements in interest rates. This strat-
egy had a modestly negative impact on performance during the period.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These
views are not intended to be a forecast of future events and are no guarantee of future results.

¹ Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results
² Tax equivalent yield assumes the maximum federal tax rate of 35%.
³ The distribution rate is not constant and is subject to change.
⁴ Represents TOBs as a percentage of total managed assets, which is the total assets of the Trust, including any assets attributable to TOBs, minus the sum of accrued liabilities.
For a discussion of leveraging techniques utilized by the Trust, please see The Benefits and Risks of Leveraging on page 11.

The table below summarizes the changes in the Trust’s market price and NAV per share:

 

The following charts show the sector and credit quality allocations of the Trust’s long-term investments:

 

⁵ Using the higher of S&P’s or Moody’s ratings.
⁶ Through its investment in TOBs, the Trust has economic exposure to investment
grade bonds.
⁷ The investment advisor has deemed certain of these securities to be of investment
grade quality. As of April 30, 2011 and April 30, 2010, the market value of these
securities was $3,226,983 representing 1% and $5,264,180 representing 2%,
respectively, of the Trust’s long-term investments.

 

---

Trust Summary as of April 30, 2011 BlackRock Municipal 2020 Term Trust

Trust Overview

BlackRock Municipal 2020 Term Trust’s (BKK) (the “Trust”) investment objectives are to provide current income exempt from regular federal income tax
and to return $15 per Common Share (the initial offering price per Common Share) to holders of Common Shares on or about December 31, 2020. The
Trust seeks to achieve its investment objectives by investing, under normal market conditions, at least 80% of its assets in municipal bonds exempt from
federal income taxes (except that the interest may be subject to the federal alternative minimum tax). The Trust invests, under normal market conditions, at
least 80% of its assets in municipal bonds that are investment grade quality at the time of investment. The Trust may invest directly in such securities or syn-
thetically through the use of derivatives.

No assurance can be given that the Trust’s investment objective will be achieved.

Performance

For the 12 months ended April 30, 2011, the Trust returned 6.29% based on market price and 5.96% based on NAV. For the same period, the closed-end
Lipper General Municipal Debt Funds (Leveraged) category posted an average return of (0.60)% based on market price and 0.10% based on NAV. All returns
reflect reinvestment of dividends. The Trust's premium to NAV, which widened during the period, accounts for the difference between performance based on
price and performance based on NAV. The following discussion relates to performance based on NAV. The Trust is managed to a 2020 termination date and
therefore maintains a shorter maturity profile than its Lipper category competitors, generally. This shorter maturity profile was the primary driver of the Trust’s
strong performance for the period as interest rates declined in the intermediate range and short end of the yield curve. The Trust has limited exposure to the
long end of the curve, where interest rates rose during the period, and therefore did not experience price declines of the same magnitude as did its Lipper cat-
egory competitors with longer maturity profiles. Detracting from performance was the Trust’s overexposure to the transportation sector, which was among the
weaker performing sectors during the period.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These
views are not intended to be a forecast of future events and are no guarantee of future results.

¹ Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.
² Tax equivalent yield assumes the maximum federal tax rate of 35%.
³ The distribution rate is not constant and is subject to change.
⁴ Represents Preferred Shares and TOBs as a percentage of total managed assets, which is the total assets of the Trust, including any assets attributable to Preferred Shares and
TOBs, minus the sum of accrued liabilities. For a discussion of leveraging techniques utilized by the Trust, please see The Benefits and Risks of Leveraging on page 11.

The table below summarizes the changes in the Trust’s market price and NAV per share:

 

The following charts show the sector and credit quality allocations of the Trust’s long-term investments:

 

⁵ Using the higher of S&P’s or Moody’s ratings.
⁶ The investment advisor has deemed certain of these securities to be of investment
grade quality. As of April 30, 2011 and April 30, 2010, the market value of these
securities was $11,262,007 representing 2% and $11,978,514 representing 3%,
respectively, of the Trust’s long-term investments.

 

---

Trust Summary as of April 30, 2011 BlackRock Municipal Income Trust

Trust Overview

BlackRock Municipal Income Trust’s (BFK) (the “Trust”) investment objective is to provide current income exempt from regular federal income tax. The Trust
seeks to achieve its investment objective by investing primarily in municipal bonds exempt from federal income taxes (except that the interest may be sub-
ject to the federal alternative minimum tax). The Trust invests, under normal market conditions, at least 80% of its assets in municipal bonds that are invest-
ment grade quality at the time of investment. The Trust may invest directly in such securities or synthetically through the use of derivatives.

No assurance can be given that the Trust’s investment objective will be achieved.

Performance

For the 12 months ended April 30, 2011, the Trust returned (1.07)% based on market price and (1.04)% based on NAV. For the same period, the closed-
end Lipper General Municipal Debt Funds (Leveraged) category posted an average return of (0.60)% based on market price and 0.10% based on NAV. All
returns reflect reinvestment of dividends. The Trust's premium to NAV, which narrowed during the period, accounts for the difference between performance
based on price and performance based on NAV. The following discussion relates to performance based on NAV. As interest rates rose and the yield curve
steepened in the later part of the reporting period, the Trust’s holdings of longer-dated bonds had a negative impact on performance. The Trust’s high expo-
sure to the health care sector and low exposure to tax-backed issues in the Far West and Mid-Atlantic regions also detracted. Contributing positively to per-
formance were security selection and sector allocation among corporates and housing as well as tax-backed issues in the South East region. Additional
benefits were derived from seasoned portfolio holdings with shorter remaining terms to their maturity, which exhibited lower price volatility compared to
longer-dated bonds during the period. The Trust uses interest rate futures contracts to hedge portfolio risk related to movements in interest rates. This strat-
egy had a modestly negative impact on performance during the period.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These
views are not intended to be a forecast of future events and are no guarantee of future results.

¹ Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.
² Tax equivalent yield assumes the maximum federal tax rate of 35%.
³ The distribution rate is not constant and is subject to change.
⁴ Represents Preferred Shares and TOBs as a percentage of total managed assets, which is the total assets of the Trust, including any assets attributable to Preferred Shares and
TOBs, minus the sum of accrued liabilities. For a discussion of leveraging techniques utilized by the Trust, please see The Benefits and Risks of Leveraging on page 11.

The table below summarizes the changes in the Trust’s market price and NAV per share:

 

The following charts show the sector and credit quality allocations of the Trust’s long-term investments:

 

⁵ Using the higher of S&P’s or Moody’s ratings.
⁶ The investment advisor has deemed certain of these securities to be of investment
grade quality. As of April 30, 2011 and April 30, 2010, the market value of these
securities was $28,787,350 representing 3% and $16,636,260 representing 2%,
respectively, of the Trust’s long-term investments.

 

---

Trust Summary as of April 30, 2011 BlackRock Pennsylvania Strategic Municipal Trust

Trust Overview

BlackRock Pennsylvania Strategic Municipal Trust’s (BPS) (the “Trust”) investment objectives are to provide current income that is exempt from regular
federal and Pennsylvania income taxes and to invest in municipal bonds that over time will perform better than the broader Pennsylvania municipal bond
market. The Trust seeks to achieve its investment objectives by investing, under normal market conditions, primarily in municipal bonds exempt from federal
income taxes (except that the interest may be subject to the federal alternative minimum tax) and Pennsylvania income taxes. The Trust invests, under nor-
mal market conditions, at least 80% of its assets in municipal bonds that are investment grade quality at the time of investment. The Trust may invest
directly in such securities or synthetically through the use of derivatives.

No assurance can be given that the Trust’s investment objective will be achieved.

Performance

For the 12 months ended April 30, 2011, the Trust returned 0.00% based on market price and 1.07% based on NAV. For the same period, the closed-end
Lipper Pennsylvania Municipal Debt Funds category posted an average return of (0.27)% based on market price and 0.86% based on NAV. All returns
reflect reinvestment of dividends. The Trust moved from a premium to NAV to a discount by period-end, which accounts for the difference between perform-
ance based on price and performance based on NAV. The following discussion relates to performance based on NAV. The Trust’s holdings generated a high
level of income accrual during the period by maintaining a high coupon structure and low level of cash reserves. In addition, the Trust sought investments
with valuations that remain attractive relative to their level of credit risk. Also contributing to performance was capital appreciation in the Trust’s holdings in
the short end and intermediate range of the yield curve, where interest rates declined during the period. Conversely, the Trust’s overall longer duration stance
(greater sensitivity to interest rates) detracted from performance as the municipal market saw long-term interest rates rise and the yield curve steepen due
to credit concerns, the expiration of the Build America Bond program and the general perception among investors that improving economic growth may lead
to higher inflation expectations. The Trust uses interest rate futures contracts to hedge portfolio risk related to movements in interest rates. This strategy had
a modestly negative impact on performance during the period.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These
views are not intended to be a forecast of future events and are no guarantee of future results.

¹ Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.
² Tax equivalent yield assumes the maximum federal tax rate of 35%.
³ The distribution rate is not constant and is subject to change.
⁴ Represents Preferred Shares and TOBs as a percentage of total managed assets, which is the total assets of the Trust, including any assets attributable to Preferred Shares and
TOBs, minus the sum of accrued liabilities. For a discussion of leveraging techniques utilized by the Trust, please see The Benefits and Risks of Leveraging on page 11.

The table below summarizes the changes in the Trust’s market price and NAV per share:

 

The following charts show the sector and credit quality allocations of the Trust’s long-term investments:

 

⁵ Using the higher of S&P’s or Moody’s ratings.
⁶ The investment advisor has deemed certain of these securities to be of investment
grade quality. As of April 30, 2011 and April 30, 2010, the market value of these
securities was $486,340 representing 1% and $2,069,225 representing 5%, respec-
tively, of the Trust’s long-term investments.

 

---

Trust Summary April 30, 2011 BlackRock Strategic Municipal Trust

Trust Overview

BlackRock Strategic Municipal Trust’s (BSD) (the “Trust”) investment objective is to provide current income that is exempt from regular federal income tax
and to invest in municipal bonds that over time will perform better than the broader municipal bond market. The Trust seeks to achieve its investment objec-
tive by investing, primarily in municipal bonds exempt from federal income taxes (except that the interest may be subject to the federal alternative minimum
tax). The Trust invests at least 80% of its assets in investment grade quality securities at the time of investment and, under normal market conditions, prima-
rily invests in municipal bonds with long-term maturities in order to maintain a weighted average maturity of 15 years or more. The Trust may invest directly
in such securities or synthetically through the use of derivatives.

No assurance can be given that the Trust’s investment objective will be achieved.

Performance

For the 12 months ended April 30, 2011, the Trust returned (1.65)% based on market price and 1.19% based on NAV. For the same period, the closed-
end Lipper General Municipal Debt Funds (Leveraged) category posted an average return of (0.60)% based on market price and 0.10% based on NAV. All
returns reflect reinvestment of dividends. The Trust's discount to NAV, which widened during the period, accounts for the difference between performance
based on price and performance based on NAV. The following discussion relates to performance based on NAV. Security selection and sector allocation
among corporates, housing and transportation as well as tax-backed issues in the Great Lakes region drove the Trust’s positive performance. Additional
benefits were derived from seasoned portfolio holdings with shorter remaining terms to their maturity, which exhibited lower price volatility compared to
longer-dated bonds during the period. As interest rates rose and the yield curve steepened in the later part of the period, holdings of longer-dated bonds
detracted from performance. In addition, the Trust’s high exposure to the health care sector and low exposure to tax-backed issues in the Far West and
Mid-Atlantic regions had a negative impact on performance. The Trust uses interest rate futures contracts to hedge portfolio risk related to movements in
interest rates. This strategy had a modestly negative impact on performance during the period.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These
views are not intended to be a forecast of future events and are no guarantee of future results.

¹ Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.
² Tax equivalent yield assumes the maximum federal tax rate of 35%.
³ The distribution rate is not constant and is subject to change.
⁴ Represents Preferred Shares and TOBs as a percentage of total managed assets, which is the total assets of the Trust, including any assets attributable to Preferred Shares and
TOBs, minus the sum of accrued liabilities. For a discussion of leveraging techniques utilized by the Trust, please see The Benefits and Risks of Leveraging on page 11.

The table below summarizes the changes in the Trust’s market price and NAV per share:

 

The following charts show the sector and credit quality allocations of the Trust’s long-term investments:

 

⁵ Using the higher of S&P’s or Moody’s ratings.
⁶ The investment advisor has deemed certain of these securities to be of investment
grade quality. As of April 30, 2011 and April 30, 2010, the market value of these
securities was $3,150,431 representing 2% and $2,354,758 representing 2%,
respectively, of the Trust’s long-term investments.

 

---

The Benefits and Risks of Leveraging

The Trusts may utilize leverage to seek to enhance the yield and NAV of
their common shares (“Common Shares”). However, these objectives can-
not be achieved in all interest rate environments.

To leverage, all the Trusts, except for BTA, issue preferred shares (“Preferred
Shares”), which pay dividends at prevailing short-term interest rates,
and invest the proceeds in long-term municipal bonds. In general, the
concept of leveraging is based on the premise that the cost of assets
to be obtained from leverage will be based on short-term interest rates,
will normally be lower than the income earned by each Trust on its longer-
term portfolio investments. To the extent that the total assets of each
Trust (including the assets obtained from leverage) are invested in higher-
yielding portfolio investments, each Trust’s holders of Common Shares
(“Common Shareholders”) will benefit from the incremental net income.

To illustrate these concepts, assume a Trust’s Common Shares capitalization
is $100 million and it issues Preferred Shares for an additional $50 million,
creating a total value of $150 million available for investment in long-term
municipal bonds. If prevailing short-term interest rates are 3% and long-
term interest rates are 6%, the yield curve has a strongly positive slope.
In this case, the Trust pays dividends on the $50 million of Preferred
Shares based on the lower short-term interest rates. At the same time,
the securities purchased by the Trust with assets received from Preferred
Shares issuance earn the income based on long-term interest rates. In
this case, the dividends paid to holders of Preferred Shares (“Preferred
Shareholders”) are significantly lower than the income earned on the
Trust’s long-term investments, and therefore the Common Shareholders
are the beneficiaries of the incremental net income.

If short-term interest rates rise, narrowing the differential between short-
term and long-term interest rates, the incremental net income pickup on
the Common Shares will be reduced or eliminated completely. Furthermore,
if prevailing short-term interest rates rise above long-term interest rates of
6%, the yield curve has a negative slope. In this case, the Trust pays divi-
dends on the higher short-term interest rates whereas the Trust’s total port-
folio earns income based on lower long-term interest rates.

Furthermore, the value of the Trusts’ portfolio investments generally varies
inversely with the direction of long-term interest rates, although other factors
can influence the value of portfolio investments. In contrast, the redemption
values of the Trusts’ Preferred Shares do not fluctuate in relation to interest
rates. As a result, changes in interest rates can influence the Trusts’ NAVs
positively or negatively in addition to the impact on Trust performance from
leverage from Preferred Shares discussed above.

The Trusts may also leverage their assets through the use of TOBs, as
described in Note 1 of the Notes to Financial Statements. TOB investments
generally will provide the Trusts with economic benefits in periods of
declining short-term interest rates, but expose the Trusts to risks during
periods of rising short-term interest rates similar to those associated with
Preferred Shares issued by the Trusts, as described above. Additionally, fluc-
tuations in the market value of municipal bonds deposited into the TOB
trust may adversely affect each Trust’s NAV per share.

The use of leverage may enhance opportunities for increased returns to the
Trusts and Common Shareholders, but as described above, it also creates
risks as short or long-term interest rates fluctuate. Leverage also will gener-
ally cause greater changes in the Trusts’ NAVs, market prices and dividend
rates than comparable portfolios without leverage. If the income derived
from securities purchased with assets received from leverage exceeds the
cost of leverage, the Trusts’ net income will be greater than if leverage had
not been used. Conversely, if the income from the securities purchased is
not sufficient to cover the cost of leverage, the Trusts’ net income will be
less than if leverage had not been used, and therefore the amount avail-
able for distribution to Common Shareholders will be reduced. Each Trust
may be required to sell portfolio securities at inopportune times or at dis-
tressed values in order to comply with regulatory requirements applicable
to the use of leverage or as required by the terms of leverage instruments,
which may cause a Trust to incur losses. The use of leverage may limit each
Trust’s ability to invest in certain types of securities or use certain types of
hedging strategies, such as in the case of certain restrictions imposed by
ratings agencies that rate Preferred Shares issued by the Trusts. Each Trust
will incur expenses in connection with the use of leverage, all of which
are borne by Common Shareholders and may reduce income to the
Common Shares.

Under the Investment Company Act of 1940, the Trusts are permitted to
issue Preferred Shares in an amount of up to 50% of their total managed
assets at the time of issuance. Under normal circumstances, each Trust
anticipates that the total economic leverage from Preferred Shares and/or
TOBs will not exceed 50% of its total managed assets at the time such
leverage is incurred. As of April 30, 2011, the Trusts had economic leverage
from Preferred Shares and/or TOBs as a percentage of their total managed
assets as follows:

 

Derivative Financial Instruments

The Trusts may invest in various derivative financial instruments, including
financial futures contracts, as specified in Note 2 of the Notes to Financial
Statements, which may constitute forms of economic leverage. Such instru-
ments are used to obtain exposure to a market without owning or taking
physical custody of securities or to hedge market and/or interest rate risks.
Such derivative financial instruments involve risks, including the imperfect
correlation between the value of a derivative instrument and the underlying
asset, possible default of the counterparty to the transaction or illiquidity of
the derivative instrument. The Trusts’ ability to use a derivative instrument
successfully depends on the investment advisor’s ability to predict pertinent
market movements accurately, which cannot be assured. The use of deriva-
tive financial instruments may result in losses greater than if they had not
been used, may require a Trust to sell or purchase portfolio investments at
inopportune times or for distressed values, may limit the amount of appre-
ciation a Trust can realize on an investment, may result in lower dividends
paid to shareholders or may cause a Trust to hold an investment that it
might otherwise sell. The Trusts’ investments in these instruments are dis-
cussed in detail in the Notes to Financial Statements.

 

---

BlackRock Investment Quality Municipal Trust Inc. (BKN)
Schedule of Investments April 30, 2011
(Percentages shown are based on Net Assets)

 

 

 

 

---

BlackRock Investment Quality Municipal Trust Inc. (BKN)
Schedule of Investments (continued)
(Percentages shown are based on Net Assets)

 

 

See Notes to Financial Statements.

 

---

BlackRock Investment Quality Municipal Trust Inc. (BKN)
Schedule of Investments (continued)
(Percentages shown are based on Net Assets)

 

 

See Notes to Financial Statements.

14 ANNUAL REPORT APRIL 30, 2011

---

BlackRock Investment Quality Municipal Trust Inc. (BKN)
Schedule of Investments (continued)
(Percentages shown are based on Net Assets)

 

* The cost and unrealized appreciation (depreciation) of investments as of April 30,
2011, as computed for federal income tax purposes, were as follows:

(a) Represents a zero-coupon bond. Rate shown reflects the current yield as of
report date.
(b) Represents a step-up bond that pays an initial coupon rate for the first period and
then a higher coupon rate for the following periods. Rate shown reflects the current
yield as of report date.
(c) US government securities, held in escrow, are used to pay interest on this security as
well as to retire the bond in full at the date indicated, typically at a premium to par.

See Notes to Financial Statements.

ANNUAL REPORT APRIL 30, 2011 15

---

BlackRock Investment Quality Municipal Trust Inc. (BKN)
Schedule of Investments (concluded)

(d) When-issued security. Unsettled when-issued transactions were as follows:

(e) Security is collateralized by Municipal or US Treasury obligations.
(f) Issuer filed for bankruptcy and/or is in default of interest payments.
(g) Non-income producing security.
(h) Variable rate security. Rate shown is as of report date.
(i) Securities represent bonds transferred to a TOB in exchange for which the Trust
acquired residual interest certificates. These securities serve as collateral in a
financing transaction. See Note 1 of the Notes to Financial Statements for details
of municipal bonds transferred to TOBs.
(j) Investments in companies considered to be an affiliate of the Trust during the
year, for purposes of Section 2(a)(3) of the Investment Company Act of 1940,
as amended, were as follows:

(k) Represents the current yield as of report date.

• Financial futures contracts sold as of April 30, 2011 were as follows:

• Fair Value Measurements — Various inputs are used in determining the fair value of
investments and derivative financial instruments. These inputs are summarized in
three broad levels for financial statement purposes as follows:
• Level 1 — price quotations in active markets/exchanges for identical assets
and liabilities
• Level 2 — other observable inputs (including, but not limited to: quoted prices for
similar assets or liabilities in markets that are active, quoted prices for identical
or similar assets or liabilities in markets that are not active, inputs other than
quoted prices that are observable for the assets or liabilities (such as interest
rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and
default rates) or other market-corroborated inputs)
• Level 3 — unobservable inputs based on the best information available in the
circumstances, to the extent observable inputs are not available (including the
Trust’s own assumptions used in determining the fair value of investments and
derivative financial instruments)

The inputs or methodologies used for valuing securities are not necessarily an
indication of the risk associated with investing in those securities. For information
about the Trust’s policy regarding valuation of investments and derivative financial
instruments and other significant accounting policies, please refer to Note 1 of the
Notes to Financial Statements.

The following tables summarize the inputs used as of April 30, 2011 in determining
the fair valuation of the Trust’s investments and derivative financial instruments:

¹ See above Schedule of Investments for values in each state or
political subdivision.

² Derivative financial instruments are financial futures contracts, which are valued
at the unrealized appreciation/depreciation on the instrument.

See Notes to Financial Statements.

 

---

BlackRock Long-Term Municipal Advantage Trust (BTA)
Schedule of Investments April 30, 2011
(Percentages shown are based on Net Assets)

 

 

See Notes to Financial Statements.

 

---

BlackRock Long-Term Municipal Advantage Trust (BTA)
Schedule of Investments (continued)
(Percentages shown are based on Net Assets)

 

 

See Notes to Financial Statements.

 

---

BlackRock Long-Term Municipal Advantage Trust (BTA)
Schedule of Investments (continued)
(Percentages shown are based on Net Assets)

 

* The cost and unrealized appreciation (depreciation) of investments as of April 30,
2011, as computed for federal income tax purposes, were as follows:

(a) Security exempt from registration under Rule 144A of the Securities Act of 1933.
These securities may be resold in transactions exempt from registration to qualified
institutional investors.
(b) Issuer filed for bankruptcy and/or is in default of interest payments.
(c) Non-income producing security.
(d) Variable rate security. Rate shown is as of report date.
(e) Represents a zero-coupon bond. Rate shown reflects the current yield as of
report date.
(f) Securities represent bonds transferred to a TOB trust in exchange for which the
Trust acquired residual interest certificates. These securities serve as collateral in a
financing transaction. See Note 1 of the Notes to Financial Statements for details of
municipal bonds transferred to TOBs.
(g) Investments in companies considered to be an affiliate of the Trust during the
year, for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as
amended, were as follows:

(h) Represents the current yield as of report date.

• Financial futures contracts sold as of April 30, 2011 were as follows:

 

See Notes to Financial Statements.

 

---

BlackRock Long-Term Municipal Advantage Trust (BTA)
Schedule of Investments (concluded)

• Fair Value Measurements — Various inputs are used in determining the fair value of
investments and derivative financial instruments. These inputs are summarized in
three broad levels for financial statement purposes as follows:
• Level 1 — price quotations in active markets/exchanges for identical assets
and liabilities
• Level 2 — other observable inputs (including, but not limited to: quoted prices for
similar assets or liabilities in markets that are active, quoted prices for identical
or similar assets or liabilities in markets that are not active, inputs other than
quoted prices that are observable for the assets or liabilities (such as interest
rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and
default rates) or other market-corroborated inputs)
• Level 3 — unobservable inputs based on the best information available in the
circumstances, to the extent observable inputs are not available (including the
Trust’s own assumptions used in determining the fair value of investments and
derivative financial instruments)

The inputs or methodologies used for valuing securities are not necessarily an
indication of the risk associated with investing in those securities. For information
about the Trust’s policy regarding valuation of investments and derivative financial
instruments other significant accounting policies, please refer to Note 1 of the
Notes to Financial Statements.

The following tables summarize the inputs used as of April 30, 2011 in determining
the fair valuation of the Trust’s investments and derivative financial instruments:

¹ See above Schedule of Investments for values in each state or
political subdivision.

² Derivative financial instruments are financial futures contracts, which are valued
at the unrealized appreciation/depreciation on the instrument.

See Notes to Financial Statements.

 

---

BlackRock Municipal 2020 Term Trust (BKK)
Schedule of Investments April 30, 2011
(Percentages shown are based on Net Assets)

 

 

See Notes to Financial Statements.

 

---

BlackRock Municipal 2020 Term Trust (BKK)
Schedule of Investments (continued)
(Percentages shown are based on Net Assets)

 

 

See Notes to Financial Statements.

 

---

BlackRock Municipal 2020 Term Trust (BKK)
Schedule of Investments (continued)
(Percentages shown are based on Net Assets)

 

* The cost and unrealized appreciation (depreciation) of investments as of April 30,
2011, as computed for federal income tax purposes, were as follows:

(a) Represents a zero-coupon bond. Rate shown reflects the current yield as of
report date.
(b) US government securities, held in escrow, are used to pay interest on this security as
well as to retire the bond in full at the date indicated, typically at a premium to par.
(c) Security exempt from registration under Rule 144A of the Securities Act of 1933.
These securities may be resold in transactions exempt from registration to qualified
institutional investors.
(d) Issuer filed for bankruptcy and/or is in default of interest payments.
(e) Non-income producing security.
(f) Security represents a beneficial interest in a trust. The collateral deposited into
the trust is federally tax-exempt revenue bonds issued by various state or local
governments, or their respective agencies or authorities. The security is subject to
remarketing prior to its stated maturity.
(g) Security is perpetual in nature and has no stated maturity date.
(h) Variable rate security. Rate shown is as of report date.
(i) Securities represent bonds transferred to a TOB in exchange for which the Trust
acquired residual interest certificates. These securities serve as collateral in a
financing transaction. See Note 1 of the Notes to Financial Statements for details
of municipal bonds transferred to TOBs.
(j) Investments in companies considered to be an affiliate of the Trust during the
year, for purposes of Section 2(a)(3) of the Investment Company Act of 1940,
as amended, were as follows:

(k) Represents the current yield as of report date.

See Notes to Financial Statements.

 

---

BlackRock Municipal 2020 Term Trust (BKK)
Schedule of Investments (concluded)

• Fair Value Measurements — Various inputs are used in determining the fair value
of investments. These inputs are summarized in three broad levels for financial
statement purposes as follows:
• Level 1 — price quotations in active markets/exchanges for identical assets
and liabilities
• Level 2 — other observable inputs (including, but not limited to: quoted prices for
similar assets or liabilities in markets that are active, quoted prices for identical
or similar assets or liabilities in markets that are not active, inputs other than
quoted prices that are observable for the assets or liabilities (such as interest
rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and
default rates) or other market-corroborated inputs)
• Level 3 — unobservable inputs based on the best information available in the
circumstances, to the extent observable inputs are not available (including the
Trust’s own assumptions used in determining the fair value of investments)

The inputs or methodologies used for valuing securities are not necessarily an
indication of the risk associated with investing in those securities. For information
about the Trust’s policy regarding valuation of investments and other significant
accounting policies, please refer to Note 1 of the Notes to Financial Statements.

The following table summarizes the inputs used as of April 30, 2011 in determining
the fair valuation of the Trust’s investments:

¹ See above Schedule of Investments for values in each state or
political subdivision.

See Notes to Financial Statements.

 

---

BlackRock Municipal Income Trust (BFK)
Schedule of Investments April 30, 2011
(Percentages shown are based on Net Assets)

 

 

See Notes to Financial Statements.

 

---

BlackRock Municipal Income Trust (BFK)
Schedule of Investments (continued)
(Percentages shown are based on Net Assets)

 

 

See Notes to Financial Statements.

 

---

BlackRock Municipal Income Trust (BFK)
Schedule of Investments (continued)
(Percentages shown are based on Net Assets)

 

 

See Notes to Financial Statements.

 

---

BlackRock Municipal Income Trust (BFK)
Schedule of Investments (continued)

 

* The cost and unrealized appreciation (depreciation) of investments as of April 30,
2011, as computed for federal income tax purposes, were as follows:

(a) Represents a zero-coupon bond. Rate shown reflects the current yield as of
report date.
(b) US government securities, held in escrow, are used to pay interest on this security as
well as to retire the bond in full at the date indicated, typically at a premium to par.
(c) When-issued security. Unsettled when-issued transactions were as follows:

(d) Issuer filed for bankruptcy and/or is in default of interest payments.
(e) Non-income producing security.
(f) Security exempt from registration under Rule 144A of the Securities Act of 1933.
These securities may be resold in transactions exempt from registration to qualified
institutional investors.
(g) Security represents a beneficial interest in a trust. The collateral deposited into
the trust is federally tax-exempt revenue bonds issued by various state or local
governments, or their respective agencies or authorities. The security is subject to
remarketing prior to its stated maturity.
(h) Variable rate security. Rate shown is as of report date.
(i) Securities represent bonds transferred to a TOB in exchange for which the Trust
acquired residual interest certificates. These securities serve as collateral in a
financing transaction. See Note 1 of the Notes to Financial Statements for details of
municipal bonds transferred to TOBs.
(j) Investments in companies considered to be an affiliate of the Trust during the
year, for purposes of Section 2(a)(3) of the Investment Company Act of 1940,
as amended, were as follows:

(k) Represents the current yield as of report date.

• Financial futures contracts sold as of April 30, 2011 were as follows:

 

See Notes to Financial Statements.

 

---

BlackRock Municipal Income Trust (BFK)
Schedule of Investments (concluded)

• Fair Value Measurements — Various inputs are used in determining the fair value of
investments and derivative financial instruments. These inputs are summarized in
three broad levels for financial reporting purposes as follows:

• Level 1 — price quotations in active markets/exchanges for identical assets
and liabilities
• Level 2 — other observable inputs (including, but not limited to: quoted prices for
similar assets or liabilities in markets that are active, quoted prices for identical
or similar assets or liabilities in markets that are not active, inputs other than
quoted prices that are observable for the assets or liabilities (such as interest
rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and
default rates) or other market-corroborated inputs)
• Level 3 — unobservable inputs based on the best information available in the
circumstances, to the extent observable inputs are not available (including the
Trust's own assumptions used in determining the fair value of investments and
derivative financial instruments)

The inputs or methodologies used for valuing securities are not necessarily an
indication of the risk associated with investing in those securities. For information
about the Trust’s policy regarding valuation of investments and derivative financial
instruments and other significant accounting policies, please refer to Note 1 of the
Notes to Financial Statements.

The following tables summarize the inputs used as of April 30, 2011 in determining
the fair valuation of the Trust’s investments and derivative financial instruments:

¹ See above Schedule of Investments for values in each state or
political subdivision.

² Derivative financial instruments are financial futures contracts, which are valued
at the unrealized appreciation/depreciation on the instrument.

See Notes to Financial Statements.

 

---

BlackRock Pennsylvania Strategic Municipal Trust (BPS)
Schedule of Investments April 30, 2011
(Percentages shown are based on Net Assets)

 

 

See Notes to Financial Statements.

 

---

BlackRock Pennsylvania Strategic Municipal Trust (BPS)
Schedule of Investments (continued)
(Percentages shown are based on Net Assets)

 

* The cost and unrealized appreciation (depreciation) of investments as of April 30,
2011, as computed for federal income tax purposes, were as follows:

(a) Variable rate security. Rate shown is as of report date.
(b) US government securities, held in escrow, are used to pay interest on this security as
well as to retire the bond in full at the date indicated, typically at a premium to par.
(c) When-issued security. Unsettled when-issued transactions were as follows:

(d) Security exempt from registration under Rule 144A of the Securities Act of 1933.
These securities may be resold in transactions exempt from registration to qualified
institutional investors.
(e) Security represents a beneficial interest in a trust. The collateral deposited into
the trust is federally tax-exempt revenue bonds issued by various state or local
governments, or their respective agencies or authorities. The security is subject to
remarketing prior to its stated maturity.
(f) Securities represent bonds transferred to a TOB in exchange for which the Trust
acquired residual interest certificates. These securities serve as collateral in a
financing transaction. See Note 1 of the Notes to Financial Statements for details
of municipal bonds transferred to TOBs.

See Notes to Financial Statements.

 

---

Schedule of Investments (concluded)
BlackRock Pennsylvania Strategic Municipal Trust (BPS)

(g) Investments in companies considered to be an affiliate of the Trust during the
year, for purposes of Section 2(a)(3) of the Investment Company Act of 1940,
as amended, were as follows:

(h) Represents the current yield as of report date.
• For Trust compliance purposes, the Trust’s sector classifications refer to any one
or more of the sector sub-classifications used by one or more widely recognized
market indexes or ratings group indexes, and/or as defined by Trust management.
These definitions may not apply for purposes of this report, which may combine
such sector sub-classifications for reporting ease.

• Financial futures contracts sold as of April 30, 2011 were as follows:

• Fair Value Measurements — Various inputs are used in determining the fair value of
investments and derivative financial instruments. These inputs are summarized in
three broad levels for financial statement purposes as follows:
• Level 1 — price quotations in active markets/exchanges for identical assets
and liabilities
• Level 2 — other observable inputs (including, but not limited to: quoted prices for
similar assets or liabilities in markets that are active, quoted prices for identical
or similar assets or liabilities in markets that are not active, inputs other than
quoted prices that are observable for the assets or liabilities (such as interest
rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and
default rates) or other market-corroborated inputs)
• Level 3 — unobservable inputs based on the best information available in the
circumstances, to the extent observable inputs are not available (including the
Trust’s own assumptions used in determining the fair value of investments and
derivative financial instruments)

The inputs or methodologies used for valuing securities are not necessarily an
indication of the risk associated with investing in those securities. For information
about the Trust’s policy regarding valuation of investments and derivative financial
instruments and other significant accounting policies, please refer to Note 1 of the
Notes to Financial Statements.

The following tables summarize the inputs used as of April 30, 2011 in determining
the fair valuation of the Trust’s investments and derivative financial instruments:

¹ See above Schedule of Investments for values in each sector.

² Derivative financial instruments are financial futures contracts, which are valued
at the unrealized appreciation/depreciation on the instrument.

See Notes to Financial Statements.

 

---

BlackRock Strategic Municipal Trust (BSD)
Schedule of Investments April 30, 2011
(Percentages shown are based on Net Assets)

 

 

See Notes to Financial Statements.

 

---

BlackRock Strategic Municipal Trust (BSD)
Schedule of Investments (continued)
(Percentages shown are based on Net Assets)

 

 

See Notes to Financial Statements.

 

---

BlackRock Strategic Municipal Trust (BSD)
Schedule of Investments (continued)
(Percentages shown are based on Net Assets)

 

 

See Notes to Financial Statements.

 

---

BlackRock Strategic Municipal Trust (BSD)
Schedule of Investments (concluded)
(Percentages shown are based on Net Assets)

* The cost and unrealized appreciation (depreciation) of investments as of April 30,
2011, as computed for federal income tax purposes, were as follows:

(a) Represents a zero-coupon bond. Rate shown reflects the current yield as of
report date.
(b) US government securities, held in escrow, are used to pay interest on this security as
well as to retire the bond in full at the date indicated, typically at a premium to par.
(c) When-issued security. Unsettled when-issued transactions were as follows:

(d) Issuer filed for bankruptcy and/or is in default of interest payments.
(e) Non-income producing security.
(f) Security exempt from registration under Rule 144A of the Securities Act of 1933.
These securities may be resold in transactions exempt from registration to qualified
institutional investors.
(g) Security represents a beneficial interest in a trust. The collateral deposited into
the trust is federally tax-exempt revenue bonds issued by various state or local
governments, or their respective agencies or authorities. The security is subject to
remarketing prior to its stated maturity.
(h) Variable rate security. Rate shown is as of report date.
(i) Securities represent bonds transferred to a TOB in exchange for which the Trust
acquired residual interest certificates. These securities serve as collateral in a
financing transaction. See Note 1 of the Notes to Financial Statements for details of
municipal bonds transferred to TOBs.
(j) Investments in companies considered to be an affiliate of the Trust during the
year, for purposes of Section 2(a)(3) of the Investment Company Act of 1940,
as amended, were as follows:

(k) Represents the current yield as of report date.

• Financial futures contracts sold as of April 30, 2011 were as follows:

• Fair Value Measurements — Various inputs are used in determining the fair value of
investments and derivative financial instruments. These inputs are summarized in
three broad levels for financial reporting purposes as follows:
• Level 1 — price quotations in active markets/exchanges for identical assets
and liabilities
• Level 2 — other observable inputs (including, but not limited to: quoted prices for
similar assets or liabilities in markets that are active, quoted prices for identical
or similar assets or liabilities in markets that are not active, inputs other than
quoted prices that are observable for the assets or liabilities (such as interest
rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and
default rates) or other market-corroborated inputs)
• Level 3 — unobservable inputs based on the best information available in the
circumstances, to the extent observable inputs are not available (including the
Trust’s own assumptions used in determining the fair value of investments and
derivative financial instruments)

The inputs or methodologies used for valuing securities are not necessarily an
indication of the risk associated with investing in those securities. For information
about the Trust’s policy regarding valuation of investments and derivative financial
instruments and other significant accounting policies, please refer to Note 1 of the
Notes to Financial Statements.

The following tables summarize the inputs used as of April 30, 2011 in determining
the fair valuation of the Trust’s investments and derivative financial instruments:

¹ See above Schedule of Investments for values in each state or
political subdivision.

² Derivative financial instruments are financial futures contracts, which are valued
at the unrealized appreciation/depreciation on the instrument.

See Notes to Financial Statements.

 

---

 

See Notes to Financial Statements.

 

---

 

See Notes to Financial Statements.

 

---

 

 

See Notes to Financial Statements.

 

---

 

See Notes to Financial Statements.

 

---

A Statement of Cash Flows is presented when a Trust had a significant amount of borrowing during the period based on the average borrowing outstanding
in relation to total assets.

See Notes to Financial Statements.

 

---

¹ Based on average shares outstanding.
² Total investment returns based on market price, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Where applicable,
total investment returns exclude the effects of any sales charges and include the reinvestment of dividends and distributions.
³ Aggregate total investment return.
⁴ Do not reflect the effect of dividends to Preferred Shareholders.
⁵ Annualized.
⁶ Interest expense and fees related to TOBs. See Note 1 of the Notes to Financial Statements for details of municipal bonds transferred to TOBs.

See Notes to Financial Statements.

 

---

¹ Commencement of operations.
² Net asset value, beginning of period, reflects a deduction of $0.675 per sales charge from the initial offering price of $15.00 per share.
³ Based on average shares outstanding.
⁴ Total investment returns based on market price, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Where applicable,
total investment returns exclude the effects of any sales charges and include the reinvestment of dividends and distributions.
⁵ Aggregate total investment return.
⁶ Annualized.
⁷ Interest expense and fees related to TOBs. See Note 1 of the Notes to Financial Statements for details of municipal bonds transferred to TOBs.

See Notes to Financial Statements.

 

---

¹ Based on average shares outstanding.
² Total investment returns based on market price, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Where applicable,
total investment returns exclude the effects of any sales charges and include the reinvestment of dividends and distributions.
³ Aggregate total investment return.
⁴ Do not reflect the effect of dividends to Preferred Shareholders.
⁵ Annualized.
⁶ Interest expense and fees related to TOBs. See Note 1 of the Notes to Financial Statements for details of municipal bonds transferred to TOBs.

See Notes to Financial Statements.

 

---

¹ Based on average shares outstanding.
² Amount is less than $(0.01) per share.
³ Total investment returns based on market price, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Where applicable,
total investment returns exclude the effects of any sales charges and include the reinvestment of dividends and distributions.
⁴ Aggregate total investment return.
⁵ Do not reflect the effect of dividends to Preferred Shareholders.
⁶ Annualized.
⁷ Interest expense and fees related to TOBs. See Note 1 of the Notes to Financial Statements for details of municipal bonds transferred to TOBs.

See Notes to Financial Statements.

 

---

¹ Based on average shares outstanding.
² Total investment returns based on market price, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Where applicable,
total investment returns exclude the effects of any sales charges and include the reinvestment of dividends and distributions.
³ Aggregate total investment return.
⁴ Do not reflect the effect of dividends to Preferred Shareholders.
⁵ Annualized. Certain expenses incurred during the period January 1, 2009 to April 30, 2009 have been included in the ratio but not annualized. If these expenses were annualized,
the annualized ratio of total expenses, total expenses after fees waived and before fees paid indirectly, total expenses after fees waived and paid indirectly, total expenses after fees
waived and paid indirectly and excluding interest expense and fees, net investment income and net investment income to Common Shareholders would have been 1.91%, 1.89%,
1.89%, 1.89%, 7.09% and 6.53%, respectively.
⁶ Interest expense and fees related to TOBs. See Note 1 of the Notes to Financial Statements for details of municipal bonds transferred to TOBs.

See Notes to Financial Statements.

 

---

¹ Based on average shares outstanding.
² Total investment returns based on market price, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Where applicable,
total investment returns exclude the effects of any sales charges and include the reinvestment of dividends and distributions.
³ Aggregate total investment return.
⁴ Do not reflect the effect of dividends to Preferred Shareholders.
⁵ Annualized. Certain expenses incurred during the period January 1, 2009 to April 30, 2009 have been included in the ratio but not annualized. If these expenses were annualized,
the annualized ratio of total expenses, total expenses after fees waived and before fees paid indirectly, total expenses after fees waived and paid indirectly, total expenses after fees
waived and paid indirectly and excluding interest expense and fees, net investment income and net investment income to Common Shareholders would have been 1.91%, 1.89%,
1.89%, 1.89%, 7.09% and 6.53%, respectively.
⁶ Interest expense and fees related to TOBs. See Note 1 of the Notes to Financial Statements for details of municipal bonds transferred to TOBs.

See Notes to Financial Statements.

 

---

Notes to Financial Statements

1. Organization and Significant Accounting Policies:

BlackRock Investment Quality Municipal Trust Inc. (“BKN”) is organized
as a Maryland corporation. BlackRock Long-Term Municipal Advantage
Trust (“BTA”), BlackRock Municipal 2020 Term Trust (“BKK”), BlackRock
Municipal Income Trust (“BFK”), BlackRock Pennsylvania Strategic
Municipal Trust (“BPS”) and BlackRock Strategic Municipal Trust (“BSD”)
(collectively, together with BKN, the “Trusts” or individually as the “Trust”)
are organized as Delaware statutory trusts. BKN, BKK, BFK and BSD are
registered under the Investment Company Act of 1940, as amended (the
“1940 Act”), as diversified, closed-end management investment compa-
nies. BTA and BPS are registered under the 1940 Act as non-diversified,
closed-end management investment companies. The Trusts’ financial state-
ments are prepared in conformity with accounting principles generally
accepted in the United States of America ("US GAAP"), which may require
management to make estimates and assumptions that affect the reported
amounts and disclosures in the financial statements. Actual results could
differ from those estimates. The Board of Directors and the Board of
Trustees of the Trusts are referred to throughout this report as the “Board
of Trustees” or the “Board”. The Trusts determine and make available for
publication the net asset values of their Common Shares on a daily basis.

The following is a summary of significant accounting policies followed by
the Trusts:

Valuation: US GAAP defines fair value as the price the Trusts would receive
to sell an asset or pay to transfer a liability in an orderly transaction
between market participants at the measurement date. The Trusts fair value
their financial instruments at market value using independent dealers or
pricing services under policies approved by the Board. Municipal invest-
ments (including commitments to purchase such investments on a “when-
issued” basis) are valued on the basis of prices provided by dealers or
pricing services. In determining the value of a particular investment, pricing
services may use certain information with respect to transactions in such
investments, quotations from dealers, pricing matrixes, market transactions
in comparable investments and information with respect to various
relationships between investments. Financial futures contracts traded on
exchanges are valued at their last sale price. Short-term securities with
remaining maturities of 60 days or less may be valued at amortized cost,
which approximates fair value. Investments in open-end registered invest-
ment companies are valued at net asset value each business day.

In the event that application of these methods of valuation results in a
price for an investment which is deemed not to be representative of the
market value of such investment or is not available, the investment will
be valued in accordance with a policy approved by the Board as reflecting
fair value ("Fair Value Assets"). When determining the price for Fair Value
Assets, the investment advisor and/or the sub-advisor seeks to determine
the price that each Trust might reasonably expect to receive from the cur-
rent sale of that asset in an arm’s-length transaction. Fair value determina-
tions shall be based upon all available factors that the investment advisor
and/or sub-advisor deems relevant. The pricing of all Fair Value Assets is
subsequently reported to the Board or a committee thereof.

Zero-Coupon Bonds: The Trusts may invest in zero-coupon bonds, which are
normally issued at a significant discount from face value and do not provide
for periodic interest payments. Zero-coupon bonds may experience
greater volatility in market value than similar maturity debt obligations
which provide for regular interest payments.

Forward Commitments and When-Issued Delayed Delivery Securities: The
Trusts may purchase securities on a when-issued basis and may purchase
or sell securities on a forward commitment basis. Settlement of such trans-
actions normally occurs within a month or more after the purchase or sale
commitment is made. The Trusts may purchase securities under such condi-
tions with the intention of actually acquiring them, but may enter into a
separate agreement to sell the securities before the settlement date. Since
the value of securities purchased may fluctuate prior to settlement, the
Trusts may be required to pay more at settlement than the security is
worth. In addition, the Trusts are not entitled to any of the interest earned
prior to settlement. When purchasing a security on a delayed delivery
basis, the Trusts assume the rights and risks of ownership of the security,
including the risk of price and yield fluctuations. In the event of default by
the counterparty, the Trusts' maximum amount of loss is the unrealized
appreciation of unsettled when-issued transactions, which are shown on
the Schedules of Investments.

Municipal Bonds Transferred to TOBs: The Trusts leverage their assets
through the use of TOBs. A TOB is established by a third party sponsor
forming a special purpose entity, into which one or more funds, or an agent
on behalf of the funds, transfers municipal bonds. Other funds managed by
the investment advisor may also contribute municipal bonds to a TOB into
which a Trust has contributed bonds. A TOB typically issues two classes of
beneficial interests: short-term floating rate certificates, which are sold to
third party investors, and residual certificates (“TOB Residuals”), which are
generally issued to the participating funds that made the transfer. The TOB
Residuals held by a Trust include the right of a Trust (1) to cause the hold-
ers of a proportional share of the short-term floating rate certificates to
tender their certificates at par, including during instances of a rise in short-
term interest rates, and (2) to transfer, within seven days, a corresponding
share of the municipal bonds from the TOB to a Trust. The TOB may also be
terminated without the consent of a Trust upon the occurrence of certain
events as defined in the TOB agreements. Such termination events may
include the bankruptcy or default of the municipal bond, a substantial
downgrade in credit quality of the municipal bond, the inability of the TOB
to obtain quarterly or annual renewal of the liquidity support agreement, a
substantial decline in market value of the municipal bond or the inability to
remarket the short-term floating rate certificates to third party investors.
During the year ended April 30, 2011, no TOBs that the Trusts participated
in have been terminated without the consent of the Trusts.

The cash received by the TOB from the sale of the short-term floating rate
certificates, less transaction expenses, is paid to a Trust, which typically
invests the cash in additional municipal bonds. Each Trust's transfer of the
municipal bonds to a TOB is accounted for as a secured borrowing, there-
fore the municipal bonds deposited into a TOB are presented in the Trusts'
Schedules of Investments and the proceeds from the issuance of the short-
term floating rate certificates are shown as trust certificates in the
Statements of Assets and Liabilities.

 

---

Notes to Financial Statements (continued)

Interest income, including amortization and accretion of premiums and dis-
counts, from the underlying municipal bonds is recorded by the Trusts on
an accrual basis. Interest expense incurred on the secured borrowing and
other expenses related to remarketing, administration and trustee services
to a TOB are shown as interest expense and fees in the Statements of
Operations. The short-term floating rate certificates have interest rates that
generally reset weekly and their holders have the option to tender certifi-
cates to the TOB for redemption at par at each reset date. At April 30,
2011, the aggregate value of the underlying municipal bonds transferred to
TOBs, the related liability for trust certificates and the range of interest
rates on the liability for trust certificates were as follows:

 

For the year ended April 30, 2011, the Trusts' average trust certificates out-
standing and the daily weighted average interest rate, including fees, were
as follows:

 

Should short-term interest rates rise, the Trusts' investments in TOBs
may adversely affect the Trusts' net investment income and dividends to
Common Shareholders. Also, fluctuations in the market values of municipal
bonds deposited into the TOB may adversely affect the Trusts' net asset
values per share.

Segregation and Collateralization: In cases in which the 1940 Act and the
interpretive positions of the Securities and Exchange Commission (“SEC”)
require that the Trusts either deliver collateral or segregate assets in con-
nection with certain investments (e.g., financial futures contracts) the Trusts
will, consistent with SEC rules and/or certain interpretive letters issued by
the SEC, segregate collateral or designate on their books and records cash
or liquid securities having a market value at least equal to the amount that
would otherwise be required to be physically segregated. Furthermore,
based on requirements and agreements with certain exchanges and third
party broker-dealers, each party to such transactions has requirements to
deliver/deposit securities as collateral for certain investments.

Investment Transactions and Investment Income: For financial reporting
purposes, investment transactions are recorded on the dates the transactions
are entered into (the trade dates). Realized gains and losses on
investment transactions are determined on the identified cost basis.
Dividend income is recorded on the ex-dividend dates. Interest income,
including amortization and accretion of premiums and discounts on debt
securities, is recognized on the accrual basis.

Dividends and Distributions: Dividends from net investment income are
declared and paid monthly. Distributions of capital gains are recorded on
the ex-dividend dates. The amount and timing of dividends and distribu-
tions are determined in accordance with federal income tax regulations,
which may differ from US GAAP. Dividends and distributions to Preferred
Shareholders are accrued and determined as described in Note 7.

Income Taxes: It is each Trust's policy to comply with the requirements of
the Internal Revenue Code of 1986, as amended, applicable to regulated
investment companies and to distribute substantially all of its taxable
income to its shareholders. Therefore, no federal income tax provision
is required.

Each Trust files US federal and various state and local tax returns. No
income tax returns are currently under examination. The statute of limita-
tions on the Trusts' US federal tax returns remains open for each of the two
years ended April 30, 2011, the period ended April 30, 2009 and the pre-
ceding taxable year of the respective Trust. The statutes of limitations on
each Trust’s state and local tax returns may remain open for an additional
year depending upon the jurisdiction. Management does not believe there
are any uncertain tax positions that require recognition of a tax liability.

Deferred Compensation and BlackRock Closed-End Share Equivalent
Investment Plan: Under the deferred compensation plan approved by each
Trust's Board, independent Trustees (“Independent Trustees”) may defer a
portion of their annual complex-wide compensation. Deferred amounts
earn an approximate return as though equivalent dollar amounts had been
invested in common shares of certain other BlackRock Closed-End Funds
selected by the Independent Trustees. This has approximately the same
economic effect for the Independent Trustees as if the Independent
Trustees had invested the deferred amounts directly in certain other
certain BlackRock Closed-End Funds.

The deferred compensation plan is not funded and obligations thereunder
represent general unsecured claims against the general assets of each
Trust. Each Trust may, however, elect to invest in common shares of certain
other BlackRock Closed-End Funds selected by the Independent Trustees in
order to match its deferred compensation obligations. Investments to cover
each Trust's deferred compensation liability, if any, are included in other
assets in the Statements of Assets and Liabilities. Dividends and distribu-
tions from the BlackRock Closed-End Fund investments under the plan are
included in income — affiliated in the Statements of Operations.

Other: Expenses directly related to a Trust are charged to that Trust. Other
operating expenses shared by several funds are pro rated among those
funds on the basis of relative net assets or other appropriate methods.
The Trusts have an arrangement with the custodian whereby fees may be
reduced by credits earned on uninvested cash balances, which if applica-
ble are shown as fees paid indirectly in the Statements of Operations. The

 

---

Notes to Financial Statements (continued)

custodian imposes fees on overdrawn cash balances, which can be offset
by accumulated credits earned or may result in additional custody charges.

2. Derivative Financial Instruments:

The Trusts engage in various portfolio investment strategies using derivative
contracts both to increase the returns of the Trusts and to economically
hedge, or protect, their exposure to certain risks such as interest rate risk.
These contracts may be transacted on an exchange.

Losses may arise if the value of the contract decreases due to an unfavor-
able change in the market rates or values of the underlying instrument or if
the counterparty does not perform under the contract. Counterparty risk
related to exchange-traded financial futures contracts is deemed to be
minimal due to the protection against defaults provided by the exchange
on which these contracts trade.

Financial Futures Contracts: The Trusts purchase or sell financial futures
contracts and options on financial futures contracts to gain exposure to, or
economically hedge against, changes in interest rates (interest rate risk).
Financial futures contracts are agreements between the Trusts and a coun-
terparty to buy or sell a specific quantity of an underlying instrument at a
specified price and at a specified date. Depending on the terms of the par-
ticular contract, futures contracts are settled either through physical deliv-
ery of the underlying instrument on the settlement date or by payment of a
cash settlement amount on the settlement date. Pursuant to the contract,
the Trusts agree to receive from or pay to the broker an amount of cash
equal to the daily fluctuation in value of the contract. Such receipts or pay-
ments are known as margin variation and are recorded by the Trusts as
unrealized appreciation or depreciation. When the contract is closed, the
Trusts record a realized gain or loss equal to the difference between the
value of the contract at the time it was opened and the value at the time it
was closed. The use of financial futures contracts involves the risk of an
imperfect correlation in the movements in the price of the financial futures
contracts, interest rates and the underlying assets.

* Includes cumulative appreciation/depreciation on financial futures contracts as reported in the Schedules of Investments. Only current day’s margin variation is reported within
the Statements of Assets and Liabilities.

 

For the year ended April 30, 2011, the average quarterly balances of
outstanding derivative financial instruments were as follows:

 

3. Investment Advisory Agreement and Other Transactions
with Affiliates:

As of April 30, 2011, The PNC Financial Services Group, Inc. ("PNC"), Bank
of America Corporation ("BAC") and Barclays Bank PLC ("Barclays") were
the largest stockholders of BlackRock, Inc. ("BlackRock"). Due to the own-
ership structure, PNC is an affiliate of the Trusts for 1940 Act purposes, but
BAC and Barclays are not.

Each Trust entered into an Investment Advisory Agreement with BlackRock
Advisors, LLC (the “Manager”), the Trusts' investment advisor, an indirect,
wholly owned subsidiary of BlackRock, to provide investment advisory and
administration services. The Manager is responsible for the management
of each Trust's portfolio and provides the necessary personnel, facilities,
equipment and certain other services necessary to the operations of each
Trust. For such services, each Trust pays the Manager a monthly fee at the
following annual rates of each Trust's average weekly net assets as follows:

 

Average weekly net assets for all of the Trusts, except BTA, is the average
weekly value of each Trust’s total assets minus the sum of its accrued lia-
bilities. For BTA, average weekly net assets is the average weekly value of
the Trust's total assets minus the sum of its total liabilities.

 

---

Notes to Financial Statements (continued)

The Manager voluntarily agreed to waive a portion of the investment advi-
sory fees or other expenses as a percentage of its average daily net assets
as follows:

 

For the year ended April 30, 2011, the Manager waived the following
amounts, which are included in fees waived by advisor in the Statements of
Operations:

 

The Manager voluntarily agreed to waive its investment advisory fees by the
amount of investment advisory fees each Trust pays to the Manager indi-
rectly through its investment in affiliated money market funds, however the
Manager does not waive its investment advisory fees by the amount of
investment advisory fees paid through each Trust's investment in other affil-
iated investment companies, if any. These amounts are shown as, or
included in, fees waived by advisor in the Statements of Operations. For the
year ended April 30, 2011, the amounts waived were as follows:

 

The Manager entered into a sub-advisory agreement with BlackRock
Financial Management, LLC (“BFM”), an affiliate of the Manager. The
Manager pays BFM for services it provides, a monthly fee that is a percent-
age of the investment advisory fees paid by each Trust to the Manager.

BKN has an Administration Agreement with the Manager. The administration
fee paid to the Manager is computed at an annual rate of 0.15% of the
Trust’s average weekly net assets including proceeds from the issuance of
Preferred Shares and TOBs.

For the period May 1, 2010 through December 31, 2010, each Trust reim-
bursed the Manager for certain accounting services, which are included in
accounting services in the Statements of Operations. The reimbursements
were as follows:

 

Effective January 1, 2011, the Trusts no longer reimburse the Manager for
accounting services.

Certain officers and/or trustees of the Trusts are officers and/or directors of
BlackRock or its affiliates. The Trusts reimburse the Manager for compensa-
tion paid to the Trusts' Chief Compliance Officer.

4. Investments:

Purchases and sales of investments excluding short-term securities, for the
year ended April 30, 2011, were as follows:

 

5. Income Tax Information:

Reclassifications: US GAAP require that certain components of net assets be adjusted to reflect permanent differences between financial and tax reporting.
These reclassifications have no effect on net assets or net asset values per share. The following permanent differences as of April 30, 2011 attributable to
amortization methods on fixed income securities, income recognized from pass-through entities, distributions received from regulated investment compa-
nies, the expiration of capital loss carryforwards and the sale of bonds received from tender option bond trusts were reclassified to the following accounts:

 

The tax character of distributions paid during the fiscal years ended April 30, 2011 and April 30, 2010 was as follows:

 

 

---

Notes to Financial Statements (continued)

As of April 30, 2011, the tax components of accumulated net earnings (losses) were as follows:

* The differences between book-basis and tax-basis net unrealized losses were attributable primarily to the tax deferral of losses on wash sales, amortization methods for premiums
and discounts on fixed income securities, the deferral of post-October capital losses for tax purposes, the timing and recognition of partnership income, the treatment of residual
interests in tender option bond trusts, the accrual of income on securities in default, the realization for tax purposes of unrealized gains/losses on certain futures contracts and the
deferral of compensation to trustees.

As of April 30, 2011, the Funds had capital loss carryforwards available to offset future realized capital gains through the indicated expiration dates:

 

Under the recently enacted Regulated Investment Company Modernization Act of 2010, capital losses incurred by the Funds after April 30, 2011 will not be
subject to expiration. In addition, these losses must be utilized prior to the losses incurred in pre-enactment taxable years.

6. Concentration, Market and Credit Risk:

The Trusts invest a substantial amount of their assets in issuers located in
a single state or limited number of states. Please see the Schedules of
Investments for concentration in specific states.

Many municipalities insure repayment of their bonds, which may reduce the
potential for loss due to credit risk. The market value of these bonds may
fluctuate for other reasons, including market perception of the value of
such insurance, and there is no guarantee that the insurer will meet its
obligation.

In the normal course of business, the Trusts invest in securities and enter
into transactions where risks exist due to fluctuations in the market (market
risk) or failure of the issuer of a security to meet all its obligations (credit
risk). The value of securities held by the Trusts may decline in response to
certain events, including those directly involving the issuers whose securi-
ties are owned by the Trusts; conditions affecting the general economy;
overall market changes; local, regional or global political, social or eco-
nomic instability; and currency and interest rate and price fluctuations.
Similar to credit risk, the Trusts may be exposed to counterparty risk, or the
risk that an entity with which the Trusts have unsettled or open transactions
may default. The Trusts manage counterparty risk by entering into transac-
tions only with counterparties that they believe have the financial resources
to honor their obligations and by monitoring the financial stability of those
counterparties. Financial assets, which potentially expose the Trusts to
credit and counterparty risks, consist principally of investments and cash
due from counterparties. The extent of the Trusts' exposure to credit and
counterparty risks with respect to these financial assets is generally
approximated by their value recorded in the Trusts' Statements of Assets and
Liabilities, less any collateral held by the Trusts.

As of April 30, 2011, BKN, BFK, BPS and BSD invested a significant portion
of their assets in the health sector. Changes in economic conditions affect-
ing the health sector would have a greater impact on the Trusts and could
affect the value, income and/or liquidity of positions in such securities.

7. Capital Share Transactions:

BKK, BFK, BPS and BSD are authorized to issue an unlimited number of
shares, including Preferred Shares, par value $0.001 per share, all of which
were initially classified as Common Shares. BKN is authorized to issue 200
million shares including Preferred Shares, all of which were initially classi-
fied as Common Shares, par value $0.01 per share. BTA is authorized to
issue an unlimited number of Common Shares, par value $0.001 per
share. BTA is also allowed to issue Preferred Shares but has not done so.
The Board is authorized, however, to reclassify any unissued shares without
approval of Common Shareholders.

Common Shares

At April 30, 2011, the shares owned by an affiliate of the Manager of the
Trusts were as follows:

 

 

---

Notes to Financial Statements (continued)

For the years shown, shares issued and outstanding increased by the fol-
lowing amounts as a result of dividend reinvestment:

 

Shares issued and outstanding remained constant for BKK for the years
ended April 30, 2011 and April 30, 2010.

Preferred Shares

The Preferred Shares are redeemable at the option of each Trust, in whole
or in part, on any dividend payment date at their liquidation preference
per share plus any accumulated and unpaid dividends whether or not
declared. The Preferred Shares are also subject to mandatory redemption
at their liquidation preference plus any accumulated and unpaid dividends,
whether or not declared, if certain requirements relating to the composition
of the assets and liabilities of a Trust, as set forth in each Trust's Articles
Supplementary (the “Governing Instrument”) are not satisfied.

From time to time in the future, each Trust may effect repurchases of its
Preferred Shares at prices below their liquidation preference as agreed
upon by the Trust and seller. Each Trust also may redeem its Preferred
Shares from time to time as provided in the applicable Governing
Instrument. Each Trust intends to effect such redemptions and/or repur-
chases to the extent necessary to maintain applicable asset coverage
requirements or for such other reasons as the Board may determine.

The holders of Preferred Shares have voting rights equal to the holders of
Common Shares (one vote per share) and will vote together with holders
of Common Shares (one vote per share) as a single class. However, the
holders of Preferred Shares, voting as a separate class, are also entitled
to elect two Trustees for each Trust. In addition, the 1940 Act requires that
along with approval by shareholders that might otherwise be required, the
approval of the holders of a majority of any outstanding Preferred Shares,
voting separately as a class would be required to (a) adopt any plan of
reorganization that would adversely affect the Preferred Shares, (b) change
a Trust's sub-classification as a closed-end investment company or change
its fundamental investment restrictions or (c) change its business so as to
cease to be an investment company.

The Trusts had the following series of Preferred Shares outstanding,
effective yields and reset frequency as of April 30, 2011:

 

Dividends on seven-day and 28-day Preferred Shares are cumulative at
a rate which is reset every seven or 28 days, respectively, based on the
results of an auction. If the Preferred Shares fail to clear the auction on an
auction date, each Trust is required to pay the maximum applicable rate on
the Preferred Shares to holders of such shares for successive dividend peri-
ods until such time as the shares are successfully auctioned. The maximum
applicable rate on all series of Preferred Shares is the higher of 110% of
the AA commercial paper rate of 110% of 90% of the Kenny S&P 30-day
High Grade Index rate divided by 1.00 minus the marginal tax rate. The low,
high and average dividend rates on the Preferred Shares for each Trust for
the year ended April 30, 2011 were as follows:

 

Since February 13, 2008, the Preferred Shares of the Trusts failed to clear
any of their auctions. As a result, the Preferred Shares dividend rates were
reset to the maximum applicable rate, which ranged from 0.35% to 0.50%
for the year ended April 30, 2011. A failed auction is not an event of
default for the Trusts but it has a negative impact on the liquidity of
Preferred Shares. A failed auction occurs when there are more sellers of a
Trust's auction rate preferred shares than buyers. A successful auction for
the Trusts' Preferred Shares may not occur for some time, if ever, and even
if liquidity does resume, Preferred Shareholders may not have the ability
to sell the Preferred Shares at their liquidation preference.

 

---

Notes to Financial Statements (concluded)

The Trusts may not declare dividends or make other distributions on
Common Shares or purchase any such shares if, at the time of the
declaration, distribution or purchase, asset coverage with respect to the
outstanding Preferred Shares is less than 200%.

The Trusts pay commissions of 0.15% on the aggregate principal amount of
all shares that fail to clear their auctions and 0.25% on the aggregate prin-
cipal amount of all shares that successfully clear their auctions. Certain
broker dealers have individually agreed to reduce commissions for failed
auctions.

Preferred Shares issued and outstanding remained constant for all Trusts
for the year ended April 30, 2011 and for the year ended April 30, 2010
for BKK.

During the year ended April 30, 2010, the Trusts announced the following
redemptions of Preferred Shares at a price of $25,000 per share plus any
accrued and unpaid dividends through the redemption date:

 

The Trusts financed the Preferred Share redemptions with cash received
from TOB transactions.

8. Subsequent Events:

Management's evaluation of the impact of all subsequent events on the
Trusts' financial statements was completed through the date the financial
statements were issued and the following items were noted:

Each Trust paid a net investment income dividend on June 1, 2011 to
Common Shareholders of record on May 16, 2011 as follows:

 

The dividends declared on Preferred Shares for the period May 1, 2011 to
May 31, 2011 were as follows:

 

Each Trust will pay a net investment income dividend on July 1, 2011 to
Common Shareholders of record on June 15, 2011 as follows:

 

 

---

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Directors/Trustees of:
BlackRock Investment Quality Municipal Trust Inc.
BlackRock Long-Term Municipal Advantage Trust
BlackRock Municipal 2020 Term Trust
BlackRock Municipal Income Trust
BlackRock Pennsylvania Strategic Municipal Trust
BlackRock Strategic Municipal Trust (collectively
the “Trusts”):

We have audited the accompanying statements of assets and liabilities
of BlackRock Investment Quality Municipal Trust Inc., BlackRock Long-
Term Municipal Advantage Trust, BlackRock Municipal 2020 Term Trust,
BlackRock Municipal Income Trust, BlackRock Pennsylvania Strategic
Municipal Trust, and BlackRock Strategic Municipal Trust, including the
schedules of investments, as of April 30, 2011, the related statements
of operations for the year then ended, the statement of cash flows for the
year then ended for BlackRock Long-Term Municipal Advantage Trust, the
statements of changes in net assets for each of the two years in the period
then ended, and the financial highlights for each of the periods presented.
These financial statements and financial highlights are the responsibility of
the Trusts’ 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. The Trusts are not required to have, nor were we
engaged to perform, an audit of their internal control over financial report-
ing. 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 Trusts’ 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 signifi-
cant estimates made by management, as well as evaluating the overall
financial statement presentation. Our procedures included confirmation of
securities owned as of April 30, 2011, by correspondence with the custo-
dian and brokers; where replies were not received from brokers, we per-
formed other auditing procedures. 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 BlackRock Investment Quality Municipal Trust Inc., BlackRock Long-
Term Municipal Advantage Trust, BlackRock Municipal 2020 Term Trust,
BlackRock Municipal Income Trust, BlackRock Pennsylvania Strategic
Municipal Trust, and BlackRock Strategic Municipal Trust as of April 30,
2011, the results of their operations for the year then ended, the cash
flows for the year then ended for BlackRock Long-Term Municipal Advantage
Trust, the changes in their net assets for each of the two years in the period
then ended, and the financial highlights for each of the periods presented,
in conformity with accounting principles generally accepted in the United
States of America.

Deloitte & Touche LLP
Princeton, New Jersey
June 27, 2011

Important Tax Information (Unaudited)

The following table summarizes the taxable per share distributions paid by BKN, BTA, BFK and BSD during the taxable year ended April 30, 2011:

¹ Additionally, all ordinary income distributions consist of Interest Related Dividends and are eligible for exemption from US withholding tax for nonresident aliens and
foreign corporations.

All other net investment income distributions paid by BKN, BTA, BKK, BFK, BPS and BSD during the taxable year ended April 30, 2011 qualify as
tax-exempt interest dividends for federal income tax purposes.

 

---

Automatic Dividend Reinvestment Plans

Pursuant to each Trust’s Dividend Reinvestment Plan (the “Reinvestment
Plan”), Common Shareholders are automatically enrolled to have all distri-
butions of dividends and capital gains reinvested by Computershare Trust
Company, N.A. (the “Reinvestment Plan Agent”) in the respective Trust’s
shares pursuant to the Reinvestment Plan. Shareholders who do not partic-
ipate in the Reinvestment Plan will receive all distributions in cash paid by
check and mailed directly to the shareholders of record (or if the shares
are held in street or other nominee name, then to the nominee) by the
Reinvestment Plan Agent, which serves as agent for the shareholders in
administering the Reinvestment Plan.

After BKN, BTA, BFK, BPS and BSD declare a dividend or determine to
make a capital gain distribution, the Reinvestment Plan Agent will acquire
shares for the participants’ accounts, depending upon the following circum
stances, either (i) through receipt of unissued but authorized shares from
the Trust (“newly issued shares”) or (ii) by purchase of outstanding shares
on the open market, on the Trust’s primary exchange (“open-market pur-
chases”). If, on the dividend payment date, the NAV per share is equal to
or less than the market price per share plus estimated brokerage commis-
sions (such condition often referred to as a “market premium”), the
Reinvestment Plan Agent will invest the dividend amount in newly issued
shares on behalf of the participants. The number of newly issued shares to
be credited to each participant’s account will be determined by dividing
the dollar amount of the dividend by the NAV on the date the shares are
issued. However, if the NAV per share is less than 95% of the market price
on the payment date, the dollar amount of the dividend will be divided by
95% of the market price on the payment date. If, on the dividend payment
date, the NAV per share is greater than the market value per share plus
estimated brokerage commissions (such condition often referred to as a
“market discount”), the Reinvestment Plan Agent will invest the dividend
amount in shares acquired on behalf of the participants in open-market
purchases. If the Reinvestment Plan Agent is unable to invest the full divi-
dend amount in open market purchases, or if the market discount shifts to
a market premium during the purchase period, the Reinvestment Plan
Agent will invest any un-invested portion in newly issued shares.

After BKK declares a dividend or determines to make a capital gain distri-
bution, the Reinvestment Plan Agent will acquire shares for the participants’
account by the purchase of outstanding shares on the open market, on
BKK’s primary exchange (“open market purchases”). BKK will not issue any
new shares under the Reinvestment Plan.

Participation in the Reinvestment Plan is completely voluntary and may be
terminated or resumed at any time without penalty by notice if received
and processed by the Reinvestment Plan Agent prior to the dividend record
date; otherwise such termination or resumption will be effective with
respect to any subsequently declared dividend or other distribution.

The Reinvestment Plan Agent’s fees for the handling of the reinvestment
of dividends and distributions will be paid by each Trust. However, each
participant will pay a pro rata share of brokerage commissions incurred
with respect to the Reinvestment Plan Agent’s open market purchases in
connection with the reinvestment of dividends and distributions. The auto-
matic reinvestment of dividends and distributions will not relieve partici-
pants of any federal income tax that maybe payable on such dividends
or distributions.

Each Trust reserves the right to amend or terminate the Reinvestment Plan.
There is no direct service charge to participants in the Reinvestment Plan;
however, each Trust reserves the right to amend the Reinvestment Plan to
include a service charge payable by the participants. Participants that
request a sale of shares through the Reinvestment Plan Agent are subject
to a $2.50 sales fee and a $0.15 per share sold brokerage commission.
All correspondence concerning the Reinvestment Plan should be directed
to the Reinvestment Plan Agent at P.O. Box 43078, Providence, RI 02940-
3078 or by calling (800) 699-1BFM. All overnight correspondence should
be directed to the Reinvestment Plan Agent at 250 Royall Street, Canton,
MA 02021.

 

---

 

 

---

 

 

---

 

 

Effective November 10, 2010, Ira P. Shapiro became Secretary of the Trusts.

Effective February 11, 2011, John M. Perlowski became President and Chief Executive Officer of the Trusts.

Effective April 14, 2011, Michael Castellano became a Trustee of the Trusts and a Member of the Audit Committee.

 

---

Additional Information

Trust Certification

Those Trusts listed for trading on the New York Stock Exchange (“NYSE”)
have filed with the NYSE their annual chief executive officer certification
regarding compliance with the NYSE’s listing standards. Each Trust filed
with the Securities and Exchange Commission (“SEC”) the certification of
its chief executive officer and chief financial officer required by section 302
of the Sarbanes-Oxley Act.

Dividend Policy

The Trusts’ dividend policy is to distribute all or a portion of their net invest-
ment income to their shareholders on a monthly basis. In order to provide
shareholders with a more stable level of dividend distributions, the Trusts
may at times pay out less than the entire amount of net investment income
earned in any particular month and may at times in any particular month
pay out such accumulated but undistributed income in addition to net
investment income earned in that month. As a result, the dividends
paid by the Trusts for any particular month may be more or less than the
amount of net investment income earned by the Trusts during such month.
The Trusts’ current accumulated but undistributed net investment income,
if any, is disclosed in the Statements of Assets and Liabilities, which com-
prises part of the financial information included in this report.

 

---

Additional Information (continued)

General Information

On July 29, 2010, the Manager announced that a derivative complaint
had been filed by shareholders of BSD and BFK on July 27, 2010 in the
Supreme Court of the State of New York, New York County. The complaint
names the Manager, BlackRock, Inc. and certain of the trustees, officers
and portfolio managers of BSD and BFK (collectively, the “Defendants”)
as defendants. The complaint alleges, among other things, that the
Defendants breached fiduciary duties owed to BSD and BFK and each
of their Common Shareholders by redeeming Preferred Shares at their
liquidation preference. The complaint seeks unspecified damages for losses
purportedly suffered by BSD and BFK as a result of the prior redemptions
and injunctive relief preventing BSD and BFK from redeeming Preferred
Shares at their liquidation preference in the future. The Defendants believe
that the claims asserted in the complaint are without merit and intend to
vigorously defend themselves in the litigation.

The Trusts do not make available copies of their Statements of Additional
Information because the Trusts’ shares are not continuously offered, which
means that the Statement of Additional Information of each Trust has not
been updated after completion of the respective Trust’s offerings and the
information contained in each Trust’s Statement of Additional Information
may have become outdated.

During the period, there were no material changes in the Trusts’ invest-
ment objectives or policies or to the Trusts’ charters or by-laws that were
not approved by shareholders or in the principal risk factors associated
with investment in the Trusts. There have been no changes in the persons
who are primarily responsible for the day-to-day management of the
Trusts’ portfolio.

Quarterly performance, semi-annual and annual reports and other informa-
tion regarding the Trusts may be found on BlackRock’s website, which can
be accessed at http://www.blackrock.com. This reference to BlackRock’s
website is intended to allow investors public access to information regard-
ing the Trusts and does not, and is not intended to, incorporate BlackRock’s
website into this report.

Electronic Delivery

Electronic copies of most financial reports are available on the Trusts’ web-
sites or shareholders can sign up for e-mail notifications of quarterly state-
ments, annual and semi-annual reports by enrolling in the Trusts’ electronic
delivery program.

Shareholders Who Hold Accounts with Investment Advisors, Banks
or Brokerages:

Please contact your financial advisor to enroll. Please note that not all
investment advisors, banks or brokerages may offer this service.

Householding

The Trusts will mail only one copy of shareholder documents, including
annual and semi-annual reports and proxy statements, to shareholders
with multiple accounts at the same address. This practice is commonly
called “householding” and is intended to reduce expenses and eliminate
duplicate mailings of shareholder documents. Mailings of your shareholder
documents may be householded indefinitely unless you instruct us other-
wise. If you do not want the mailing of these documents to be combined
with those for other members of your household, please
call (800) 441-7762.

Availability of Quarterly Schedule of Investments

Each Trust files its complete schedule of portfolio holdings with the SEC
for the first and third quarters of each fiscal year on Form N-Q. The Trusts’
Forms N-Q are available on the SEC’s website at http://www.sec.gov and
may also be reviewed and copied at the SEC’s Public Reference Room in
Washington, DC. Information on how to access documents on the SEC’s
website without charge may be obtained by calling (800) SEC-0330. Each
Trust’s Forms N-Q may also be obtained upon request and without charge
by calling (800) 441-7762.

Availability of Proxy Voting Policies and Procedures

A description of the policies and procedures that the Trusts use to
determine how to vote proxies relating to portfolio securities is avail-
able (1) without charge, upon request, by calling (800) 441-7762;
(2) at http://www.blackrock.com; and (3) on the SEC’s website at
http://www.sec.gov.

Availability of Proxy Voting Record

Information about how the Trusts voted proxies relating to securities
held in the Trusts’ portfolios during the most recent 12-month period
ended June 30 is available upon request and without charge
(1) at http://www.blackrock.com or by calling (800) 441-7762 and
(2) on the SEC’s website at http://www.sec.gov.

Availability of Trust Updates

BlackRock will update performance and certain other data for the Trusts
on a monthly basis on its website in the “Closed-end Funds” section of
http://www.blackrock.com. Investors and others are advised to periodically
check the website for updated performance information and the release of
other material information about the Trusts.

 

---

Additional Information (concluded)

BlackRock Privacy Principles

BlackRock is committed to maintaining the privacy of its current and for-
mer fund investors and individual clients (collectively, “Clients”) and to
safeguarding their non-public personal information. The following infor-
mation is provided to help you understand what personal information
BlackRock collects, how we protect that information and why in certain
cases we share such information with select parties.

If you are located in a jurisdiction where specific laws, rules or regulations
require BlackRock to provide you with additional or different privacy-related
rights beyond what is set forth below, then BlackRock will comply with those
specific laws, rules or regulations.

BlackRock obtains or verifies personal non-public information from and
about you from different sources, including the following: (i) information we
receive from you or, if applicable, your financial intermediary, on applica-
tions, forms or other documents; (ii) information about your transactions
with us, our affiliates, or others; (iii) information we receive from a consumer
reporting agency; and (iv) from visits to our websites.

BlackRock does not sell or disclose to non-affiliated third parties any non-
public personal information about its Clients, except as permitted by law
or as is necessary to respond to regulatory requests or to service Client
accounts. These non-affiliated third parties are required to protect the
confidentiality and security of this information and to use it only for its
intended purpose.

We may share information with our affiliates to service your account or to
provide you with information about other BlackRock products or services
that may be of interest to you. In addition, BlackRock restricts access
to non-public personal information about its Clients to those BlackRock
employees with a legitimate business need for the information. BlackRock
maintains physical, electronic and procedural safeguards that are designed
to protect the non-public personal information of its Clients, including pro-
cedures relating to the proper storage and disposal of such information.

 

---

This report is transmitted to shareholders only. It is not a prospectus. Past performance results shown in this report should not be considered a

representation of future performance. Certain Trusts have leveraged their Common Shares, which creates risks for Common Shareholders, including

the likelihood of greater volatility of net asset value and market price of the Common Shares and the risk that fluctuations in the short-term dividend

rates of the Preferred Shares, currently set at the maximum reset rate as a result of failed auctions, may reduce the Common Shares’ yield.

Statements and other information herein are as dated and are subject to change.

---

Item 2 – Code of Ethics – The registrant (or the “Fund”) has adopted a code of ethics, as of the end
of the period covered by this report, applicable to the registrant’s principal executive officer,
principal financial officer, principal accounting officer, or controller, or persons performing
similar functions. During the period covered by this report, there have been no amendments
to or waivers granted under the code of ethics. A copy of the code of ethics is available
without charge at www.blackrock.com.

Item 3 – Audit Committee Financial Expert – The registrant’s board of directors (the “board of
directors”), has determined that (i) the registrant has the following audit committee financial
experts serving on its audit committee and (ii) each audit committee financial expert is
independent:

Frank J. Fabozzi
James T. Flynn
W. Carl Kester
Karen P. Robards

The registrant’s board of directors has determined that W. Carl Kester and Karen P. Robards
qualify as financial experts pursuant to Item 3(c)(4) of Form N-CSR.

Prof. Kester has a thorough understanding of generally accepted accounting principles,
financial statements and internal control over financial reporting as well as audit committee
functions. Prof. Kester has been involved in providing valuation and other financial
consulting services to corporate clients since 1978. Prof. Kester’s financial consulting
services present a breadth and level of complexity of accounting issues that are generally
comparable to the breadth and complexity of issues that can reasonably be expected to be
raised by the registrant’s financial statements.

Ms. Robards has a thorough understanding of generally accepted accounting principles,
financial statements and internal control over financial reporting as well as audit committee
functions. Ms. Robards has been President of Robards & Company, a financial advisory
firm, since 1987. Ms. Robards was formerly an investment banker for more than 10 years
where she was responsible for evaluating and assessing the performance of companies based
on their financial results. Ms. Robards has over 30 years of experience analyzing financial
statements. She also is a member of the audit committee of one publicly held company and
a non-profit organization.

Under applicable securities laws, a person determined to be an audit committee financial
expert will not be deemed an “expert” for any purpose, including without limitation for the
purposes of Section 11 of the Securities Act of 1933, as a result of being designated or
identified as an audit committee financial expert. The designation or identification as an
audit committee financial expert does not impose on such person any duties, obligations, or
liabilities greater than the duties, obligations, and liabilities imposed on such person as a
member of the audit committee and board of directors in the absence of such designation or
identification. The designation or identification of a person as an audit committee financial
expert does not affect the duties, obligations, or liability of any other member of the audit
committee or board of directors.

---

Item 4 – Principal Accountant Fees and Services

The following table presents fees billed by Deloitte & Touche LLP (“D&T”) in each of the
last two fiscal years for the services rendered to the Fund:

 

The following table presents fees billed by D&T that were required to be approved by the
registrant’s audit committee (the “Committee”) for services that relate directly to the
operations or financial reporting of the Fund and that are rendered on behalf of BlackRock
Advisors, LLC (“Investment Adviser”) and entities controlling, controlled by, or under
common control with BlackRock (not including any sub-adviser whose role is primarily
portfolio management and is subcontracted with or overseen by another investment adviser)
that provide ongoing services to the Fund (“Fund Service Providers”):

 

(e)(1) Audit Committee Pre-Approval Policies and Procedures:
The Committee has adopted policies and procedures with regard to the pre-approval
of services. Audit, audit-related and tax compliance services provided to the registrant on
an annual basis require specific pre-approval by the Committee. The Committee also must
approve other non-audit services provided to the registrant and those non-audit services
provided to the Investment Adviser and Fund Service Providers that relate directly to the
operations and the financial reporting of the registrant. Certain of these non-audit services
that the Committee believes are a) consistent with the SEC’s auditor independence rules and
b) routine and recurring services that will not impair the independence of the independent
accountants may be approved by the Committee without consideration on a specific case-
by-case basis (“general pre-approval”). The term of any general pre-approval is 12 months
from the date of the pre-approval, unless the Committee provides for a different period. Tax
or other non-audit services provided to the registrant which have a direct impact on the
operations or financial reporting of the registrant will only be deemed pre-approved
provided that any individual project does not exceed $10,000 attributable to the registrant or
$50,000 per project. For this purpose, multiple projects will be aggregated to determine if
they exceed the previously mentioned cost levels.

Any proposed services exceeding the pre-approved cost levels will require specific
pre-approval by the Committee, as will any other services not subject to general pre-
approval (e.g., unanticipated but permissible services). The Committee is informed of each
service approved subject to general pre-approval at the next regularly scheduled in-person
board meeting. At this meeting, an analysis of such services is presented to the Committee

---

for ratification. The Committee may delegate to the Committee Chairman the authority to
approve the provision of and fees for any specific engagement of permitted non-audit
services, including services exceeding pre-approved cost levels.

(e)(2) None of the services described in each of Items 4(b) through (d) were approved by
the Committee pursuant to the de minimis exception in paragraph (c)(7)(i)(C) of Rule 2-01
of Regulation S-X.

(f) Not Applicable

(g) The aggregate non-audit fees paid to the accountant for services rendered by the
accountant to the registrant, the Investment Adviser and the Fund Service Providers were:

 

Additionally, SAS No. 70 fees for the current and previous fiscal years of $3,030,000 and
$2,950,000, respectively, were billed by D&T to the Investment Adviser.

(h) The Committee has considered and determined that the provision of non-audit services
that were rendered to the Investment Adviser (not including any non-affiliated sub-adviser
whose role is primarily portfolio management and is subcontracted with or overseen by the
registrant’s investment adviser), and the Fund Service Providers that were not pre-approved
pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with
maintaining the principal accountant’s independence.

Item 5 – Audit Committee of Listed Registrants

(a) The following individuals are members of the registrant’s separately-designated
standing audit committee established in accordance with Section 3(a)(58)(A) of the
Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(58)(A)):

Michael Castellano
Frank J. Fabozzi
James T. Flynn
W. Carl Kester
Karen P. Robards

(b) Not Applicable

Item 6 – Investments
(a) The registrant’s Schedule of Investments is included as part of the Report to
Stockholders filed under Item 1 of this Form.
(b) Not Applicable due to no such divestments during the semi-annual period covered since
the previous Form N-CSR filing.

Item 7 – Disclosure of Proxy Voting Policies and Procedures for Closed-End Management
Investment Companies – The board of directors has delegated the voting of proxies for the
Fund’s portfolio securities to the Investment Adviser pursuant to the Investment Adviser’s
proxy voting guidelines. Under these guidelines, the Investment Adviser will vote proxies

---

related to Fund securities in the best interests of the Fund and its stockholders. From time
time, a vote may present a conflict between the interests of the Fund’s stockholders, on the
one hand, and those of the Investment Adviser, or any affiliated person of the Fund or the
Investment Adviser, on the other. In such event, provided that the Investment Adviser’s
Equity Investment Policy Oversight Committee, or a sub-committee thereof (the “Oversight
Committee”) is aware of the real or potential conflict or material non-routine matter and if
the Oversight Committee does not reasonably believe it is able to follow its general voting
guidelines (or if the particular proxy matter is not addressed in the guidelines) and vote
impartially, the Oversight Committee may retain an independent fiduciary to advise the
Oversight Committee on how to vote or to cast votes on behalf of the Investment Adviser’s
clients. If the Investment Adviser determines not to retain an independent fiduciary, or does
not desire to follow the advice of such independent fiduciary, the Oversight Committee shall
determine how to vote the proxy after consulting with the Investment Adviser’s Portfolio
Management Group and/or the Investment Adviser’s Legal and Compliance Department
and concluding that the vote cast is in its client’s best interest notwithstanding the conflict.
A copy of the Fund’s Proxy Voting Policy and Procedures are attached as Exhibit
99.PROXYPOL. Information on how the Fund voted proxies relating to portfolio securities
during the most recent 12-month period ended June 30 is available without charge, (i) at
www.blackrock.com and (ii) on the SEC’s website at http://www.sec.gov.

Item 8 – Portfolio Managers of Closed-End Management Investment Companies – as of April 30,
2011.

(a)(1) The registrant is managed by a team of investment professionals comprised of
Theodore R. Jaeckel, Jr., CFA, Managing Director at BlackRock, Inc. (“BlackRock”)
and Walter O’Connor, Managing Director at BlackRock. Each is a member of
BlackRock’s municipal tax-exempt management group. Each is jointly responsible
for the day-to-day management of the registrant’s portfolio, which includes setting
the registrant’s overall investment strategy, overseeing the management of the
registrant and/or selection of its investments. Messrs. Jaeckel and O’Connor have
been members of the registrant’s portfolio management team since 2006 and 2006,
respectively.

 

---

(a)(2) As of April 30, 2011:

 

(iv) Potential Material Conflicts of Interest

BlackRock has built a professional working environment, firm-wide compliance culture and
compliance procedures and systems designed to protect against potential incentives that may
favor one account over another. BlackRock has adopted policies and procedures that address
the allocation of investment opportunities, execution of portfolio transactions, personal
trading by employees and other potential conflicts of interest that are designed to ensure that
all client accounts are treated equitably over time. Nevertheless, BlackRock furnishes
investment management and advisory services to numerous clients in addition to the Fund,
and BlackRock may, consistent with applicable law, make investment recommendations to
other clients or accounts (including accounts which are hedge funds or have performance or
higher fees paid to BlackRock, or in which portfolio managers have a personal interest in
the receipt of such fees), which may be the same as or different from those made to the
Fund. In addition, BlackRock, its affiliates and significant shareholders and any officer,
director, shareholder or employee may or may not have an interest in the securities whose
purchase and sale BlackRock recommends to the Fund. BlackRock, or any of its affiliates
or significant shareholders, or any officer, director, shareholder, employee or any member
of their families may take different actions than those recommended to the Fund by
BlackRock with respect to the same securities. Moreover, BlackRock may refrain from
rendering any advice or services concerning securities of companies of which any of
BlackRock’s (or its affiliates’ or significant shareholders’) officers, directors or employees
are directors or officers, or companies as to which BlackRock or any of its affiliates or
significant shareholders or the officers, directors and employees of any of them has any
substantial economic interest or possesses material non-public information. Certain
portfolio managers also may manage accounts whose investment strategies may at times be
opposed to the strategy utilized for a fund. It should also be noted that portfolio managers
may manage certain accounts that are subject to performance fees. In addition, portfolio
managers may assist in managing certain hedge funds and may be entitled to receive a
portion of any incentive fees earned on such funds and a portion of such incentive fees may
be voluntarily or involuntarily deferred. Additional portfolio managers may in the future
manage other such accounts or funds and may be entitled to receive incentive fees.

As a fiduciary, BlackRock owes a duty of loyalty to its clients and must treat each client
fairly. When BlackRock purchases or sells securities for more than one account, the
trades must be allocated in a manner consistent with its fiduciary duties. BlackRock
attempts to allocate investments in a fair and equitable manner among client accounts,
with no account receiving preferential treatment. To this end, BlackRock has adopted
policies that are intended to ensure reasonable efficiency in client transactions and

---

provide BlackRock with sufficient flexibility to allocate investments in a manner that is
consistent with the particular investment discipline and client base, as appropriate.

(a)(3) As of April 30, 2011:

Portfolio Manager Compensation Overview
BlackRock’s financial arrangements with its portfolio managers, its competitive
compensation and its career path emphasis at all levels reflect the value senior management
places on key resources. Compensation may include a variety of components and may vary
from year to year based on a number of factors. The principal components of compensation
include a base salary, a performance-based discretionary bonus, participation in various
benefits programs and one or more of the incentive compensation programs established by
BlackRock.

Base compensation. Generally, portfolio managers receive base compensation based on
their position with the firm.

Discretionary Incentive Compensation
Discretionary incentive compensation is a function of several components: the performance
of BlackRock, the performance of the portfolio manager’s group within BlackRock, the
investment performance, including risk-adjusted returns, of the firm’s assets under
management or supervision by that portfolio manager relative to predetermined
benchmarks, and the individual’s performance and contribution to the overall performance
of these portfolios and BlackRock. In most cases, these benchmarks are the same as the
benchmark or benchmarks against which the performance of the Fund or other accounts
managed by the portfolio managers are measured. BlackRock’s Chief Investment Officers
determine the benchmarks against which the performance of funds and other accounts
managed by each portfolio manager is compared and the period of time over which
performance is evaluated. With respect to the portfolio managers, such benchmarks include
a combination of market-based indices (e.g., Barclays Capital Municipal Bond Index),
certain customized indices and certain fund industry peer groups.

Among other things, BlackRock’s Chief Investment Officers make a subjective
determination with respect to each portfolio manager’s compensation based on the
performance of the Funds and other accounts managed by each portfolio manager relative to
the various benchmarks.

Performance of fixed income funds is measured on both a pre-tax and after-tax basis over
various time periods including 1-, 3-, 5- and 10-year periods, as applicable. With respect to
the performance of the other listed Index and Multi-Asset Funds, performance is measured
on, among other things, a pre-tax basis over various time periods including 1-, 3- and 5-year
periods, as applicable.

---

Distribution of Discretionary Incentive Compensation
Discretionary incentive compensation is distributed to portfolio managers in a combination
of cash and BlackRock restricted stock units which vest ratably over a number of years. For
some portfolio managers, discretionary incentive compensation is also distributed in
deferred cash awards that notionally track the returns of select BlackRock investment
products they manage and that vest ratably over a number of years. The BlackRock
restricted stock units, upon vesting, will be settled in BlackRock, Inc. common stock.
Typically, the cash bonus, when combined with base salary, represents more than 60% of
total compensation for the portfolio managers. Paying a portion of annual bonuses in stock
puts compensation earned by a portfolio manager for a given year “at risk” based on
BlackRock’s ability to sustain and improve its performance over future periods. Providing a
portion of annual bonuses in deferred cash awards that notionally track the BlackRock
investment products they manage provides direct alignment with investment product results.

Long-Term Incentive Plan Awards — From time to time long-term incentive
equity awards are granted to certain key employees to aid in retention, align their interests
with long-term shareholder interests and motivate performance. Equity awards are
generally granted in the form of BlackRock restricted stock units that, once vested, settle in
BlackRock common stock. Messrs. Jaeckel and O’Connor have each received long-term
incentive awards.

Deferred Compensation Program — A portion of the compensation paid to
eligible BlackRock employees may be voluntarily deferred into an account that tracks the
performance of certain of the firm’s investment products. Each participant in the deferred
compensation program is permitted to allocate his deferred amounts among various
BlackRock investment options. All of the portfolio managers have participated in the
deferred compensation program.

Other compensation benefits. In addition to base compensation and discretionary
incentive compensation, portfolio managers may be eligible to receive or participate in one
or more of the following:

Incentive Savings Plans — BlackRock, Inc. has created a variety of incentive
savings plans in which BlackRock employees are eligible to participate, including a
401(k) plan, the BlackRock Retirement Savings Plan (RSP), and the BlackRock Employee
Stock Purchase Plan (ESPP). The employer contribution components of the RSP include a
company match equal to 50% of the first 8% of eligible pay contributed to the plan capped
at $5,000 per year, and a company retirement contribution equal to 3-5% of eligible
compensation. The RSP offers a range of investment options, including registered
investment companies and collective investment funds managed by the firm. BlackRock
contributions follow the investment direction set by participants for their own contributions
or, absent participant investment direction, are invested into an index target date fund that
corresponds to, or is closest to, the year in which the participant attains age 65. The ESPP
allows for investment in BlackRock common stock at a 5% discount on the fair market
value of the stock on the purchase date. Annual participation in the ESPP is limited to the
purchase of 1,000 shares or a dollar value of $25,000. Each portfolio manager is eligible to
participate in these plans.

---

(a)(4) Beneficial Ownership of Securities – As of April 30, 2011.

 

(b) Not Applicable

Item 9 – Purchases of Equity Securities by Closed-End Management Investment Company and
Affiliated Purchasers – Not Applicable due to no such purchases during the period covered
by this report.

Item 10 – Submission of Matters to a Vote of Security Holders – There have been no material
changes to these procedures.

Item 11 – Controls and Procedures

(a) – The registrant’s principal executive and principal financial officers, or persons
performing similar functions, have concluded that the registrant’s disclosure controls and
procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as
amended (the “1940 Act”)) are effective as of a date within 90 days of the filing of this
report based on the evaluation of these controls and procedures required by Rule 30a-3(b)
under the 1940 Act and Rule 13a-15(b) under the Securities Exchange Act of 1934, as
amended.

(b) – There were no changes in the registrant’s internal control over financial reporting (as
defined in Rule 30a-3(d) under the 1940 Act) that occurred during the second fiscal quarter
of the period covered by this report that have materially affected, or are reasonably likely to
materially affect, the registrant’s internal control over financial reporting.

Item 12 – Exhibits attached hereto

(a)(1) – Code of Ethics – See Item 2

(a)(2) – Certifications – Attached hereto

(a)(3) – Not Applicable

(b) – Certifications – Attached hereto

---

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.

BlackRock Municipal Income Trust

By: /S/ John M. Perlowski
John M. Perlowski
Chief Executive Officer (principal executive officer) of
BlackRock Municipal Income Trust

Date: July 5, 2011

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.

By: /S/ John M. Perlowski
John M. Perlowski
Chief Executive Officer (principal executive officer) of
BlackRock Municipal Income Trust

Date: July 5, 2011

By: /S/ Neal J. Andrews
Neal J. Andrews
Chief Financial Officer (principal financial officer) of
BlackRock Municipal Income Trust

Date: July 5, 2011

---