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					                                 The Gabelli Value Fund Inc.
                                              Shareholder Commentary
                                                   June 30, 2006




To Our Shareholders,
     In a difficult market environment, The Gabelli Value Fund posted a total return of 1.03% for the second
quarter of 2006. This compared favorably with a 1.44% decline in the Standard & Poor (S&P) 500 Index, which
was weighed down by rising interest rates, high oil prices, and geopolitical uncertainty. As of June 30, 2006,
the Fund’s annualized total returns for the one year, five year, ten year, fifteen year and since inception periods
were 8.22%, 5.43%, 11.80%, 13.67%, and 12.64%, respectively.

Comparative Results
                                         Average Annual Returns through June 30, 2006*
                                                                                                                   Since
                                                        Year to                                                  Inception
                                             Quarter     Date     1 Year   3 Year   5 Year   10 Year   15 Year   (9/29/89)
 Gabelli Value Fund Class A . . . .           1.03%     8.23%      8.22%   12.56%   5.43%    11.80%    13.67%    12.64%
 S&P 500 Index . . . . . . . . . . . . . . . . (1.44)    2.71      8.62    11.21    2.49      8.32     10.73     10.35
 Dow Jones Industrial Average . . . . 0.93               5.25     11.07     9.95    3.47      9.17     11.87     11.50
 Nasdaq Composite Index . . . . . . . (7.17)            (1.51)     5.60    10.21    0.10      6.25     10.65      9.53
 * Returns represent past performance and do not guarantee future results. Total returns and average annual returns
   reflect changes in share price and reinvestment of distributions and are net of expenses. Investment returns and the
   principal value of an investment will fluctuate. When shares are redeemed, they may be worth more or less than their
   original cost. Current performance may be lower or higher than the data presented. Visit www.gabelli.com for
   performance information as of the most recent month end. Excludes the effect of the maximum 5.5% sales charge at
   the beginning of the period. Investors should carefully consider the investment objectives, risks, charges, and
   expenses of the Fund before investing. The prospectus contains more information about this and other matters
   and should be read carefully before investing. Performance returns for less than one year are not annualized. See
   page 2 for further details about additional classes of shares. The Dow Jones Industrial Average is an unmanaged index
   of 30 large industrial stocks. The S&P 500 Index and the Nasdaq Composite Index are unmanaged indicators of stock
   market performance. Dividends are considered reinvested (except for the Nasdaq Composite Index).


 We have separated the portfolio manager’s commentary from the financial statements and investment portfolio
 due to corporate governance regulations stipulated by the Sarbanes-Oxley Act of 2002. We have done this to
 ensure that the content of the portfolio manager’s commentary is unrestricted. The financial statements and
 investment portfolio are mailed separately from the commentary. Both the commentary and the financial
 statements, including the portfolio of investments, will be available on our website at www.gabelli.com/funds.
INVESTMENT RESULTS (CLASS A SHARES) (a)
                                                                                       Quarter
                                                                           — — — — –––––––— ––––– — — — —
                                                                          — — — — —––––––– —––––— — — —
                                                                           1st     2nd         3rd    4th                     Year
  2006:      Net Asset Value . . . . . . . . . . . . . . . . . . . .      $19.40    $19.60      —             —                —
             Total Return . . . . . . . . . . . . . . . . . . . . . . .     7.1%      1.0%      —             —                —
  2005:      Net Asset Value . . . . . . . . . . . . . . . . . . . .      $19.08    $19.46    $19.87        $18.11          $18.11
             Total Return . . . . . . . . . . . . . . . . . . . . . . .    (2.1)%     2.0%      2.1%         (2.1)%          (0.2)%
  2004:      Net Asset Value . . . . . . . . . . . . . . . . . .          $18.49    $18.41    $17.87        $19.49          $19.49
             Total Return . . . . . . . . . . . . . . . . . . . . .         2.9%     (0.4)%    (2.9)%        13.4%           12.8%
  2003:      Net Asset Value . . . . . . . . . . . . . . . . . .          $13.22    $15.56    $15.90        $17.97          $17.97
             Total Return . . . . . . . . . . . . . . . . . . . . .        (4.3)%    17.7%      2.2%         14.5%           31.9%
  2002:      Net Asset Value . . . . . . . . . . . . . . . . . .          $16.97    $14.43    $12.32        $13.81          $13.81
             Total Return . . . . . . . . . . . . . . . . . . . . .         3.3%    (15.0)%   (14.6)%        12.1%          (16.0)%
  2001:      Net Asset Value . . . . . . . . . . . . . . . . . .          $16.24    $17.63    $15.06        $16.43          $16.43
             Total Return . . . . . . . . . . . . . . . . . . . . .        (0.7)%     8.6%    (14.6)%        12.9%            5.4%
  2000:      Net Asset Value . . . . . . . . . . . . . . . . . .          $18.70    $18.89    $18.44        $16.13          $16.13
             Total Return . . . . . . . . . . . . . . . . . . . . .        (3.9)%     1.0%     (2.4)%        (2.8)%          (7.9)%
  1999:      Net Asset Value . . . . . . . . . . . . . . . . . .          $17.29    $19.58    $18.93        $19.45          $19.45
             Total Return . . . . . . . . . . . . . . . . . . . . .         7.5%     13.2%     (3.3)%        12.1%           31.9%
  1998:      Net Asset Value . . . . . . . . . . . . . . . . . .          $16.43    $16.94    $14.71        $16.08          $16.08
             Total Return . . . . . . . . . . . . . . . . . . . . .        14.9%      3.1%    (13.2)%        19.8%           23.2%
  1997:      Net Asset Value . . . . . . . . . . . . . . . . . .          $11.63    $14.11    $15.73        $14.30          $14.30
             Total Return . . . . . . . . . . . . . . . . . . . . .         1.0%     21.3%     11.5%          8.6%           48.2%
  1996:      Net Asset Value . . . . . . . . . . . . . . . . . .          $12.88    $13.08    $12.63        $11.52          $11.52
             Total Return . . . . . . . . . . . . . . . . . . . . .        10.9%      1.6%     (3.4)%         0.0%            8.7%
  1995:      Net Asset Value . . . . . . . . . . . . . . . . . .          $11.41    $11.75    $12.81        $11.61          $11.61
             Total Return . . . . . . . . . . . . . . . . . . . . .         8.8%      3.0%      9.0%          0.3%           22.5%
  1994:      Net Asset Value . . . . . . . . . . . . . . . . . .          $11.37    $11.55    $12.43        $10.49          $10.49
             Total Return . . . . . . . . . . . . . . . . . . . . .        (6.0)%     1.6%      7.6%         (2.7)%           0.0%
  1993:      Net Asset Value . . . . . . . . . . . . . . . . . .          $11.15    $11.93    $13.92        $12.09          $12.09
             Total Return . . . . . . . . . . . . . . . . . . . . .        10.1%      7.0%     16.7%          1.5%           39.4%
  1992:      Net Asset Value . . . . . . . . . . . . . . . . . .          $10.40     $9.84    $10.04        $10.13          $10.13
             Total Return . . . . . . . . . . . . . . . . . . . . .         9.7%     (5.4)%     2.0%          6.4%           12.7%
  1991:      Net Asset Value . . . . . . . . . . . . . . . . . .           $9.51     $9.50     $9.57         $9.48           $9.48
             Total Return . . . . . . . . . . . . . . . . . . . . .        11.8%     (0.1)%     0.7%          2.5%           15.3%
  1990:      Net Asset Value . . . . . . . . . . . . . . . . . .           $9.23     $9.36     $8.19         $8.51           $8.51
             Total Return . . . . . . . . . . . . . . . . . . . . .        (2.4)%     1.4%    (12.5)%         9.0%           (5.6)%
  1989:      Net Asset Value . . . . . . . . . . . . . . . . . .            —          —        —            $9.58           $9.58
             Total Return . . . . . . . . . . . . . . . . . . . . .         —          —        —             2.1%(b)         2.1%(b)
                                                        Average Annual Returns June 30, 2006 (a)
                                                             Class A Shares        Class B Shares            Class C Shares
                                                              — ––––— — —
                                                            — —–––– — —             — ––––— — —
                                                                                  — —–––– — —                 — ––––— — —
                                                                                                             — —–––– — —
  1 Year . . . . . . . . . . . . . . . . . . . . . .             8.22%                 7.45%                     7.44%
                                                                 2.26(c)               2.45(d)                   6.44(d)
  5 Year . . . . . . . . . . . . . . . . . . . . . .             5.63                  4.63                      4.64
                                                                 4.24(c)               4.30(d)                   4.64(d)
  10 Year . . . . . . . . . . . . . . . . . . . . .             11.80                 11.27                     11.30
                                                                11.17(c)              11.27(d)                  11.30(d)
  Life of Fund (b) . . . . . . . . . . . . . . .                12.65                 12.33                     12.35
                                                                12.27(c)              12.33(d)                  12.35(d)
 (a) Total returns and average annual returns reflect changes in share price and reinvestment of dividends and are net of expenses for
     Class A Shares. Of course, returns represent past performance and do not guarantee future results. Investment returns and the
     principal value of an investment will fluctuate. When shares are redeemed they may be worth more or less than their original cost.
     Current performance may be lower or higher than the data presented. Visit www.gabelli.com for performance information as of the
     most recent month end. The Class A Shares’ net asset values are used to calculate performance for the periods prior to the issuance
     of Class B Shares and Class C Shares on March 15, 2000. The actual performance for the Class B Shares and Class C Shares
     would have been lower due to the additional expenses associated with these classes of shares. Excludes the effect of the maximum
     5.5% sales charge at the beginning of the period. Investors should carefully consider the investment objectives, risks, charges,
     and expenses of the Fund before investing. The prospectus contains more information about this and other matters and
     should be read carefully before investing.
 (b) From commencement of investment operations on September 29, 1989.
 (c) Includes the effect of the maximum 5.5% sales charge at beginning of period.
 (d) Includes the effect of the applicable contingent deferred sales charge at the end of the period shown for Class B and Class C
     Shares, respectively. Class B Shares are not available for new purchases.
                                                                                2
Barron’s 2006 Midyear Roundtable
     Mario Gabelli, our Chief Investment Officer, has appeared in the prestigious Barron’s Roundtable
discussion annually since 1980. Many of our readers enjoyed the inclusion of selected and edited comments
from Barron’s Roundtable in previous reports to shareholders. As is our custom, we are including selected
comments of Mario Gabelli from Barron’s Midyear 2006 Roundtable published on June 17, 2006.


                                                                 BARRON’S
                                                         ROUNDTABLE
                                                                   MARIO GABELLI
                                               Chairman and Chief Investment Officer – Value Portfolios

                                                                   GAMCO Investors, Inc.



                                                       High Anxiety
                                         Churn, baby, churn:
      Our pros see more turmoil ahead for the economy and market – and more inexpensive stocks.
              - I-S-K. That simple four letter         Barron’s: Before we talk about the market, can Q: What does this mean for the U.S. stock



R             word is fine for family magazines,
              but it’s a dirty word of late where
              investments are concerned. With
              interest rates rising, economies cool-
 ing and the U.S. consumer in danger of falling
 down on the job, investors en masse decided in
 recent weeks they’ve had enough of risk, defined
                                                       you tell us about your settlement with the market?
                                                       government over the cellphone-license suit?         Gabelli: We’ll have a very strong fourth quarter,
                                                       Gabelli: In my role as chairman of Lynch as the market looks to recover from a soft landing.
                                                       Interactive [LICT.PK], a small-cap, publicly The market probably will be up 5% to 10% for
                                                       traded rural telephone company, I can’t the year, though you could have an old-fashioned
                                                       comment about that yet. As for the market, 10%-15% correction, as we’re seeing now. There
 as any asset whose price can fall as well as rally.   things are playing out much as we expected at are three wild cards: a potential derivatives
 So they’ve thrown ’em all overboard: U.S. stocks      the beginning of the year. The fourth quarter of meltdown, a geopolitical crisis involving Iran and
 and bonds, emerging market equities, gold, com-       ’05 was not strong. We had a catch-up in the first a possible Democratic landslide in November.
 modities, the whole lot. Even after last week’s       quarter because of the extra spending associated But from a money-management point of view,
 lovely rebound, U.S. stocks have given up just        with Wilma, Katrina and Rita, plus favorable we’re harvesting gains from takeover stocks and
 about all their gains for the year.                   weather. GDP came in at the upper end of even keeping money in liquid alternatives. We
 What happens next? We’re glad you asked. And          our optimistic expectations. Obviously, it’s continue to focus on dividends and deals, the
 who better to supply the answer than the              unsustainable. The economy over the balance of theme we focused on earlier in the year. We are
 members of the Barron’s Roundtable? Our               the year and into the first half of ’07 will remain positioning our portfolios to take advantage of
 midyear update features the investment insights       in positive territory, but grow at a much lower any sharp market correction.
 – and specific stock picks – of the same 12           rate. The dollar weakens, as well. Profit margins Q: What looks appealing now?
 market luminaries who grace our annual                peaked in the first half of ’06. Those are the
                                                                                                           Gabelli: We try to buy good businesses at a
 Roundtable, which last convened Jan. 9. For           issues we’re dealing with domestically.
                                                                                                           discount to their intrinsic value. One area that
 “The Midyear,” as we call it, we rang up each         Bernanke is taking the right approach to start will do well in 2007 is food products.
 and every one, dutifully recording their              his administration as an inflation fighter. And Campbell Soup [CPB] has had good pickup
 divergent views of the economy, the stock             breaking inflation expectations gives him a lot because of internal dynamics. H.J. Heinz
 market and the Federal Reserve’s new man on           of flexibility, because it is hard to quantify what [HNZ] has done well because of external as
 the spot, Ben Bernanke. On one thing, however,        inflation expectations are, except through TIPS well as internal dynamics. We like Cadbury
 our experts all agree: The shares of many good        [Treasury inflation protected securities]. As for Schweppes. The symbol in London is CBRY,
 companies haven’t been this cheap in ages.            the global economy, as the dollar weakens, the and it trades in New York under CSG. In
 Consider this your survival guide to the next six     economies of Japan and Europe remain robust. London it is selling for £5.13, and has an
 months and beyond. Read it, and keep.                 The CRIB countries – China, Russia, India and enterprise value of £14 billion. There are two
                              – Lauren R. Rublin       Brazil – will remain vibrant.                       billion shares outstanding. For 2006 they should

                                                                              3
earn 33 pence. We think those earnings grow by        the company should be broken up. Do you favor       see a cash-rich spinoff with Time Warner.
11% over the next five years, and we’ve got a 15      a breakup, too?                                     When Time Warner buys their stock back from
price-earnings multiple.                              Gabelli: The Company has alternatives,              John, John gets cash and the Atlanta Braves. He
Cadbury is best known for its confectionery           including the repurchase of a big block of stock,   somehow figures a way to spin that off to his
business. In the U.S. it bought the Adams             which I like. Over time, they could do more of      shareholders or he buys back stock.
family of gum from Pfizer [PFE] in ’03, and           that. The shareholders who want to remain will      It’s vintage Malone.
has done a good job with it. They’re also in the      get a bigger piece of a more valuable company.      It’s financial engineering, but it’s no different
beverage business, with Dr Pepper and Snapple.        Q: How much is Tribune worth?                       from what other private-equity firms are doing.
We like the cash-flow characteristics of the                                                              My next pick is Ladbrokes, formerly Hilton
company and management. This is a cheap               Gabelli: Using a 10 multiple on the
                                                      newspapers, and a little more on some of their      Group. It is based in the U.K., and I
stock, and at some point we would expect some                                                             recommended it in January. The stock is trading
kind of financial engineering, such as a spinoff      entertainment and radio assets, we get to $45 to
                                                      $55 a share. That doesn’t mean we’re not going      for £3.90. There are 623 million shares. The
or sale of the beverage business. We still like                                                           company had a reverse split, giving holders six
Danone [DA] and General Mills [GIS].                  to tender at 28-32, but it also doesn’t mean we
                                                      might not buy more. Looking toward 2008,            new shares for every 17 old ones. Ladbrokes
Coca-Cola [KO], too. The whole sector                                                                     [LAD.L] is a great brand and cash generator,
should do well, particularly with a weak dollar.      you’ll get a better regulatory environment for
                                                      media companies. Government regulation in           and at some point they figure out a way to
                                                      this industry is so far behind the technology       leverage their technological skills in the
Mario Gabelli’s Picks                                                                                     gambling business on a global basis,
Company                     Ticker   Price 6/16/06
                                                      dynamics that it can’t get much worse. You
                                                      have to allow companies to consolidate.             particularly in the U.S.
Cadbury Schweppes           CSG          $37.28                                                           Now, to touch on one of my favorite subjects:
Tribune                     TRB           31.92       My third idea is Liberty Media Capital
                                                      [LCAPA]. It was created a month ago as a            demographics. We’ve made a lot of money in
Liberty Media Capital       LCAPA         79.78                                                           dental companies. We like body-parts
Ladbrokes                   LAD.L         £3.72       tracking stock. For every 100 shares of the old
Tredegar                    TG           $14.82       Liberty Media you get five shares of LCAPA.         companies. Today’s subject is incontinence. I’m
                                                      There are about 141 million shares outstanding.     talking about the disposable-diaper market.
Q: How about another name?                                                                                Q: Diapers?
                                                      The stock is trading at 79.56, so it has a market
Gabelli: Tribune [TRB] trades for 30 and has          value of $11 billion. With $4 billion of debt,      Gabelli: The number of people in the U.S. over
a $9 billion market cap. Total enterprise value       enterprise value is $15 billion.                    the age of 65 is going to double in the next 20
[market value plus net debt] is about $10.6                                                               years. The number of people 85 and older is
billion. Our analyst thinks they can earn as          Q: What does it track?
                                                                                                          going to double, assuming no unusual
much as $2 a share this year. Everybody knows         Gabelli: You get a basket of media and              dynamics. Tredegar [TG], in Richmond, Va.,
the argument against old media companies.             telecom securities that are worth about $130 a      provides diaper components. The stock is 14.40
Tribune bought Times Mirror and wound up              share, net of debt. This is a private-equity        a share. Tredegar has a market cap of $560
with a tax issue. It has had circulation problems.    investment in public form, and you’re not           million, and the enterprise value is $650 million.
But we think [Chairman Dennis] FitzSimons             paying the typical 20% management fee.              The company makes various diaper parts, such
did the right thing by announcing a Dutch             You’re getting News Corp. for 50 cents on the       as the plastic outer sheet. They are also in the
auction to buy back 53 million shares in a range      dollar; shares in Time Warner, Sprint,              aluminum-products business, which is not as
of 28 to 32.50. It is absolutely the right strategy   Motorola, Viacom and CBS, and some other            interesting to me. The company was hurt by
to buy back company stock at a 7.5 multiple of        entities. John Malone is working hard to            rising raw-material costs, which it couldn’t pass
EBITDA [earnings before interest, taxes,              unleash value. There could be some kind of a        along. If oil stabilizes at $70 and natural gas
depreciation and amortization].                       transaction with News Corp. down the road so        prices stay down, earnings will stabilize. Plus,
Q: The Chandler family, Tribune’s second-             that he can start spinning off pieces of the        they have secular growth opportunities.
largest holder, opposes the buyback and says          company on a tax-free basis. That’s how you’ll      Interesting. Thanks, Mario.
Mario J. Gabelli is the Chairman and Chief Investment Officer – Value Portfolios of GAMCO Investors, Inc. and Portfolio Manager of The Gabelli Value
Fund. The securities mentioned in the article are not representative of the entire portfolio, and are subject to change at any time. The percentage of net
assets for each security mentioned that is held in Gabelli Value Fund’s portfolio as of 06/30/06 follows: CBS Corp. 3.72%, General Mills Inc. 0.33%, H.J.
Heinz Co. 0.99%, Ladbrokes PLC 0.30%, Liberty Media Capital Corp. 1.80%, Motorola Inc. 0.90%, News Corp. 2.44%, Sprint Nextel Corp. 3.41%, Time
Warner Inc. 2.50%, Tribune Co. 1.23%, and Viacom Inc. 5.04%. Companies mentioned in the article, but not listed here, are not holdings of The Gabelli
Value Fund as of 06/30/06.
A complete listing of the Fund’s holdings as of 06/30/06 is available by calling the distributor, Gabelli & Company, Inc., at 800-GABELLI (800-422-3554)
or by visiting our website at www.gabelli.com. Investors should carefully consider the investment objectives, risks, charges, and expenses of the Fund
before investing. The prospectus, which contains more complete information about this and other matters, should be read carefully before investing.
The views expressed in this article reflect those of the portfolio manager only through 06/17/06. Minor edits were made. The manager’s views are subject
to change at any time based on market and other conditions. Favorable earnings or EBITDA (Earning before Interest, Taxes, Depreciation and Amortization)
growth prospects do not necessarily translate into higher stock prices, but they do express a positive trend, which we believe will develop over time.
                             For more information, visit our website at: www.gabelli.com or call: 800-GABELLI
                                                      •                 •
                                    800-422-3554 914-921-5100 Fax: 914-921-5118 info@gabelli.com•
                              Distributed by Gabelli & Company, Inc. One Corporate Center, Rye, New York 10580
                                                                             4
COMMENTARY
The Economy
      We believe the U.S. economy will ratchet down over the next three quarters, while Japan and Europe will
stay robust. Consumers in the developing CRIB™ countries – China, Russia, India and Brazil – should provide
buoyancy to the global economy.
       In the meantime, the U.S. economy is currently on stable ground. Real GDP growth in the first quarter of
2006 was a high 5.6%, reflecting economic strength as well as spending post Hurricane Katrina. While this
growth will moderate, as interest rate increases have an impact on consumer spending and business activity,
it is still at healthy levels. Rate increases will affect both the economy – cooling it off to prevent inflation – and
the stock market. We keep in mind what we observed last year, that long rates higher than 5.5% cause stocks
to have greater difficulty bouncing off a sell-off, which we are seeing now.

Hunting Season
      Our 2006 theme of “Deals and Dividends” continues to play out. Worldwide, mergers and acquisitions are
set to break 2000’s record pace. Through June, $1.8 trillion worth of deals was announced, up 40% from 2005.
We are seeing transactions across a wide range of industries. In the month of June alone, Anadarko Petroleum
announced the simultaneous acquisitions of Kerr-McGee and Western Gas for a combined $21 billion; Phelps
Dodge announced a $40 billion takeover of nickel mining companies Inco and Falconbridge; and Spanish
construction services firm Grupo Ferrovial said it is buying BAA plc, the British airport operator, for $19 billion
after a bidding war.
     There is plenty of cash still available for this corporate buying spree. Companies have built up liquidity
through internally generated cash flows, and they also have plenty of borrowing power. In addition, leveraged
buyout (LBO) groups (a.k.a. private equity), which announced deals worth $145 billion in the second quarter
alone, are awash with cash and raising more.
     Because of our proprietary Private Market Value with a catalyst approach, we have always looked at a
company’s value from an acquirer’s perspective, emphasizing earnings, cash flows, undervalued or hidden
assets, and strong managements. We remain confident that the increased deal flow we see will continue to
have a favorable impact on our portfolio.

A Bet Pays Off
      Aztar Corporation, a long time Fund holding and the owner of the Tropicana Casino and Resort in Atlantic
City, as well as the Tropicana Resort and Casino on the Las Vegas strip, agreed to be acquired in May by
privately held Columbia Entertainment for $54 per share in cash. The bidding war for the company spanned a
period of two months and saw bids rise from an initial $38 per share in cash, to the winning $54 cash bid that
values Aztar at roughly $2.75 billion. The fierce competition for Aztar heated up as bidders vied for the prize of
a 34 acre parcel of land on the Las Vegas strip, on which the Tropicana now sits. Bidders saw the potential to
acquire the last remaining spot on the Strip on which to establish a new resort-casino. The transaction is subject
to Aztar shareholder, as well as gaming and regulatory approval, and is expected to close by the end of 2006.




                                                          5
Interest Rates
      In its Federal Open Market Committee statement from June 29, the Federal Reserve said that gains in
productivity had contained the rise in wages, keeping inflation expectations under control. The statement shows
that concern remains, however, with high levels of resource utilization in the economy (indicating that it is at or
near capacity) and with energy prices. After raising rates another quarter point, as expected, the Fed could be
at the end of the tightening cycle that began in June of 2004. It has adopted a “wait and see” posture with regard
to further rate hikes.
      There could be an old fashioned 10%-15% correction at any time (which we saw during the second
quarter). As the economy recovers from a “soft landing”, investors will begin to anticipate future growth, leading
to a stronger stock market in the latter part of the year. In such an environment, with numerous crosscurrents
and outcomes, stock selection will remain imperative.

Investment Scorecard
      The second quarter marked a resurgence for a number of media stocks, with holdings Cablevision, News
Corp., Tribune, and CBS Corp. up strongly. Energy and energy related stocks continued to do well. Kerr-McGee, the
subject of a takeover, and Archer-Daniels-Midland, a play on ethanol, contributed meaningfully to second quarter
performance. Gaming stocks Aztar Corp., Las Vegas Sands, and Dover Downs also performed well in the quarter.
     Despite the strength of most media holdings, declines in Viacom and Media General were a drag on
performance. A number of recent winners in the portfolio, including Sequa Corp., GenCorp, and Watts Water
Technologies gave back some of their gains. Sprint Nextel and Champion Enterprises were also weak in the
quarter. We, however, remain confident in the long-term prospects of these businesses.

Let’s Talk Stocks
      The following are stock specifics on selected holdings of our Fund. Favorable earnings prospects do not
necessarily translate into higher stock prices, but they do express a positive trend that we believe will develop
over time. Individual securities mentioned are not necessarily representative of the entire portfolio. The share
prices of the following holdings are stated as of June 30, 2006.
Archer-Daniels-Midland Co. (ADM - $41.28 - NYSE) engages in the procurement, transportation, storing,
processing, and merchandising of agricultural commodities and products. ADM’s core business is corn
processing and oilseed processing, selling corn based sweeteners (such as high fructose corn syrup) and
vegetable oils to the food industry and corn meal to the feed industry. The company has been deriving an
increasing portion of its revenues and profits from the sale of ethanol and other biofuels, as there has been
increased demand for cleaner burning fuels from renewable resources. As the leading ethanol producer in the
U.S., the company stands to benefit from the recent steep increases in ethanol prices.
Cablevision Systems Corp. (CVC - $21.45 - NYSE) is one of the nation’s leading communications and
entertainment companies. Headquartered in Bethpage, N.Y., Cablevision serves 3 million cable customers in
the most important cable TV market – New York. Cablevision also operates and has majority interests in a
number of sports related assets, including Madison Square Garden, the N.Y. Knicks, the N.Y. Rangers, the
MSG network and six other regional sports networks. In addition, Cablevision’s Rainbow Media unit owns high
growth cable networks, including AMC, Women’s Entertainment, and IFC. In June 2005, Cablevision’s
controlling Dolan family made a bid to take the cable operations private at $21 per share while spinning-off the
sports and entertainment holdings to shareholders, but revoked that offer in October 2005. The company

                                                        6
instead made a special $10 per share distribution in April 2006. We think this may be a prelude to the sale of
all or of the company in 2007. We believe the cable systems remain especially attractive to Time Warner Cable
which will become a publicly traded entity upon closure of its acquisition of Adelphia Communications.
Genuine Parts Co. (GPC - $41.66 - NYSE), a Georgia corporation incorporated in 1928, is the premier service
organization engaged in the distribution of automotive and industrial replacement parts, office products, and
electrical/electronic materials. The company’s NAPA automotive parts distribution centers and stores provide
replacement parts for substantially all motor vehicle makes and models in service in the United States,
including imported vehicles, trucks, buses, motorcycles, and recreational and farm vehicles. The Industrial
Parts Group distributes a wide variety of products to its customers, primarily industrial concerns, to maintain
and operate plants, machinery and equipment. The Office Products Group (S. P. Richards Company) is
engaged in the wholesale distribution of a broad line of office and other products that are used in the daily
operation of businesses, schools, offices, and institutions. The Electrical/Electronic Materials Group (“EIS”)
distributes materials for the manufacture and repair of electrical and electronic apparatus.
General Mills Inc. (GIS - $51.31 - NYSE) is a leading producer of packaged food; its brands include Cheerios,
Wheaties and Total cereals, Betty Crocker baking mixes, Yoplait yogurt, and Hamburger Helper. In 2001,
General Mills expanded its portfolio with its purchase of the Pillsbury Company from Diageo for approximately
$10 billion. Pillsbury produces and markets Pillsbury branded refrigerated dough and baked goods, Green
Giant vegetables, Old El Paso Mexican foods, Progresso soup, and a wide range of foodservice products. The
combined company, based in Minneapolis, MN, generates approximately $12 billion of annual revenue.
Griffon Corp. (GFF - $26.10 - NYSE) operates as a diversified manufacturing company in four segments:
Garage Doors, which manufactures residential garage doors; Installation Services, which installs specialty
building products for homebuilders; Specialty Plastic Films, which develops embossed, laminated, and printed
plastic films used in a variety of hygienic, healthcare, and industrial markets; and Electronic Information and
Communication Systems (EICS), which manufactures a variety of electronic systems used in defense and
commercial markets worldwide. Griffon’s EICS segment continues to perform well, driven by increased defense
spending in the U.S. and a greater focus on advanced communication systems. Further, over time, Griffon will
likely divest some of its businesses, generating incremental shareholder value in the process.
Kerr-McGee Corp. (KMG - $69.35 - NYSE) is an oil and gas exploration company that is set to be acquired by
Anadarko Petroleum for a very rich premium in an all cash deal. KMG’s primary focus regions include natural
gas drilling in the Rocky Mountains and deepwater drilling in the Gulf of Mexico, regions in which Anadarko
Petroleum also has a significant presence. Under the influence of large shareholder Carl Icahn, KMG had
streamlined its operations throughout 2005 with the sale of certain non-core assets and the spin-off of its
Tronox chemical business. Such transactions may have readied the company for its now pending sale, which
will likely be approved by shareholders in August.
News Corp. (NWS - $20.18 - NYSE) is a leading global media firm with interests in broadcast television, cable
networks, filmed entertainment, publishing, magazine inserts, global satellite distribution, and British and
Australian newspapers. We expect News Corp. to be among the fastest growing diversified entertainment
companies, with an attractive mix of content and distribution businesses both domestically and internationally. The
company’s recent investments in Internet properties, including its October 2005 purchase of social networking site
MySpace.com for $580 million, appear to be bearing fruit – MySpace became the most visited site in the U.S. in
the first week of July 2006, a trend we expect will continue. CEO Rupert Murdoch and his family control 30% of
the vote at News Corp. while John Malone’s Liberty Media controls 19%. There has been long running speculation
as to how Liberty might dispose of its stake and we think a peaceful resolution to the situation would be a positive
for News Corp. shares.
                                                         7
Sprint Nextel Corp. (S - $19.99 - NYSE) operates the third largest national wireless carrier in the United States,
utilizing CDMA and iDEN network technologies. Together with affiliates and resellers of its wireless service,
Sprint Nextel serves 51 million subscribers. In the second quarter of 2006, the company completed a spin-off
of its wireline communications business, Embarq Corporation (EQ - $40.99 - NYSE), the fifth largest local
phone company in the United States with 7.3 million access lines in 18 states (with the largest presence in
Florida, North Carolina, Nevada, and Ohio). Also during the second quarter, Sprint Nextel finalized the
purchase of its iDEN affiliate, Nextel Partners, adding 2.1 million subscribers, and agreed to acquire its PCS
affiliate Ubiquitel Inc. In 2005, the company entered into a joint venture with several cable companies to develop
converged next generation products for consumers designed to combine many of cable’s core products and
interactive features with wireless technology to deliver a broad range of services, including video, wireless voice
and data services, and high speed Internet and cable phone service.
Time Warner (TWX - $17.30 - NYSE) America’s largest old line media firm is a stock in everyone’s spotlight
due to lethargic performance after Carl Icahn’s failed bid to split it up. Fundamentals are clearly improving.
Warner Brothers is again producing hit films with Superman Returns and the soon to be released Snakes on
a Plane. AOL is in the middle of a surging demand for Internet advertising and the long delayed merger with
Adelphia should close in July. The latter catalyst is key in that a completion of the deal will greatly simplify the
corporate structure and increase exposure to the cable industry, a business that appears extremely well
positioned for the future. Management bought $4 billion of stock in the quarter and the stagnant stock price
should permit similar purchases in the quarter just concluded. These purchases are very accretive to enterprise
value at the current share price and levels of interest rates.

Conclusion
      Despite recent market volatility caused by economic and geopolitical factors, we remain confident that
over the long term stocks will continue to reward patient investors. Strong balance sheets and deal activity
together with continued technological advances and fusion of global economies also bode well for investors.
As markets are becoming more intertwined and complex than they have ever been in history, we believe that
solid research will continue to be relevant for a successful investment.
                                                 Sincerely,




Mario J. Gabelli, CFA                                        Christopher J. Marangi
Portfolio Manager and                                        Associate Portfolio Manager
Chief Investment Officer – Value Portfolios
July 23, 2006
      Note: The views expressed in this Shareholder Commentary reflect those of the Portfolio Managers only
through the end of the period stated in this Shareholder Commentary. The Portfolio Managers’ views are
subject to change at any time based on market and other conditions. The information in this Portfolio Managers’
Shareholder Commentary represents the opinions of the individual Portfolio Managers and is not intended to
be a forecast of future events, a guarantee of future results, or investment advice. Views expressed are those
of the Portfolio Managers and may differ from those of other portfolio managers or of the Firm as a whole. This
Shareholder Commentary does not constitute an offer of any transaction in any securities. Any
recommendation contained herein may not be suitable for all investors. Information contained in this
Shareholder Commentary has been obtained from sources we believe to be reliable, but cannot be guaranteed.
                                                         8
Portfolio Manager Compensation
      Mr. Gabelli’s incentive-based, variable compensation structure and dollar amount have been fully
disclosed each year since April of 2000 in GAMCO Investors, Inc.’s (NYSE: GBL) annual proxy statement.
Mr. Gabelli receives no base salary, no annual bonus, and no options.
      As founder and portfolio manager of the Gabelli Value Fund, Mr. Gabelli received $3,392,622 in calendar
2005. In the Fund’s first twelve months of operation starting in September 1989, Mr. Gabelli received less than
$3,200,000. As beneficial owner, he had $397,751 invested in the Gabelli Value Fund as of 06/30/06, which
includes the holdings of GGCP, Inc., GBL’s parent holding company.

Minimum Initial Investment – $1,000
      The Fund’s minimum initial investment for regular accounts is $1,000. There are no subsequent
investment minimums. No initial minimum is required for those establishing an Automatic Investment Plan.
Additionally, the Fund and other Gabelli/GAMCO Funds are available through the no-transaction fee programs
at many major brokerage firms. The Fund imposes a 2% redemption fee on shares sold in 7 days or less of a
purchase. See the prospectus for more details.

www.gabelli.com
      Please visit us on the Internet. Our homepage at www.gabelli.com contains information about GAMCO
Investors, Inc., the Gabelli/GAMCO Mutual Funds, IRAs, 401(k)s, current and historical quarterly reports,
closing prices, and other current news. We welcome your comments and questions via e-mail at
info@gabelli.com.
      You may sign up for our e-mail alerts at www.gabelli.com and receive early notice of quarterly report
availability, news events, media sightings, and mutual fund prices and performance.
     The Fund’s daily net asset value is available in the financial press and each evening after 6:00 PM
(Eastern Time) by calling 800-GABELLI (800-422-3554). The Fund’s NASDAQ symbol is GABVX for Class A
Shares. Please call us during the business day for further information.



                                              Top Ten Holdings
                                                June 30, 2006
                Cablevision Systems Corp., Cl. A              American Express Co.
                Viacom Inc., Cl. A                            Liberty Media Corp.
                Media General Inc., Cl. A                     Newmont Mining Corp.
                CBS Corp., Cl. A                              Telephone & Data Systems Inc.
                Sprint Nextel Corp.                           Time Warner Inc.




                                                      9
Gabelli Funds and Your Personal Privacy
Who are we?
The Gabelli/GAMCO Funds are investment companies registered with the Securities and Exchange
Commission under the Investment Company Act of 1940. We are managed by Gabelli Funds, LLC and
Gabelli Advisers, Inc., which are affiliated with GAMCO Investors, Inc. GAMCO Investors, Inc. is a
publicly held company that has subsidiaries that provide investment advisory or brokerage services for
a variety of clients.
What kind of non-public information do we collect about you if you become a Gabelli customer?
If you apply to open an account directly with us, you will be giving us some non-public information about
yourself. The non-public information we collect about you is:
• Information you give us on your application form. This could include your name, address,
     telephone number, social security number, bank account number, and other information.
• Information about your transactions with us, any transactions with our affiliates, and
     transactions with the entities we hire to provide services to you. This would include information
     about the shares that you buy or redeem. If we hire someone else to provide services—like a transfer
     agent—we will also have information about the transactions that you conduct through them.
What information do we disclose and to whom do we disclose it?
We do not disclose any non-public personal information about our customers or former customers to
anyone other than our affiliates, our service providers who need to know such information, and as
otherwise permitted by law. If you want to find out what the law permits, you can read the privacy rules
adopted by the Securities and Exchange Commission. They are in volume 17 of the Code of Federal
Regulations, Part 248. The Commission often posts information about its regulations on its web site,
www.sec.gov.
What do we do to protect your personal information?
We restrict access to non-public personal information about you to the people who need to know that
information in order to provide services to you or the Fund and to ensure that we are complying with the
laws governing the securities business. We maintain physical, electronic, and procedural safeguards to
keep your personal information confidential.
                                     G A B E L L I FA M I LY O F F U N D S
VALUE ________________________________________              AGGRESSIVE GROWTH _________________________               GAMCO Gold Fund
Gabelli Asset Fund                                          GAMCO Global Growth Fund                                  Seeks to invest in a global portfolio of equity
Seeks to invest primarily in a diversified portfolio of     Seeks capital appreciation through a disciplined          securities of gold mining and related companies. The
common stocks selling at significant discounts to           investment program focusing on the globalization and      Fund’s objective is long-term capital appreciation.
their private market value. The Fund’s primary              interactivity of the world’s marketplace. The Fund        Investment in gold stocks is considered speculative
objective is growth of capital. (Multiclass)                invests in companies at the forefront of accelerated      and is affected by a variety of world-wide economic,
              Portfolio Manager: Mario J. Gabelli, CFA      growth. The Fund’s primary objective is capital           financial, and political factors. (Multiclass)
                                                            appreciation. (Multiclass)            Team Managed                              Portfolio Manager: Caesar Bryan
Gabelli Blue Chip Value Fund                                                                                         Gabelli Utilities Fund
Seeks long term growth of capital through investment                                                                 Seeks to provide a high level of total return through a
primarily in the common stocks of established
companies which are temporarily out of favor. The           MICRO-CAP ___________________________________ combination of capital appreciation and current
                                                                                                                     income. (Multiclass)                       Team Managed
fund’s objective is to identify a catalyst or sequence of   Westwood Mighty MitesSM Fund
events that will return the company to a higher value.      Seeks to invest in micro-cap companies that have
(Multiclass)                                                market capitalizations of $300 million or less. The MERGER AND ARBITRAGE _____________________
                                                            Fund’s primary objective is long-term capital Gabelli ABC Fund
               Portfolio Manager: Barbara Marcin, CFA       appreciation. (Multiclass)             Team Managed Seeks to invest in securities with attractive oppor-
Westwood Equity Fund                                                                                                 tunities for appreciation or investment income. The
Seeks to invest primarily in the common stock of well-                                                               Fund’s primary objective is total return in various market
seasoned companies that have recently reported              EQUITY INCOME _______________________________ conditions without excessive risk of capital loss.
positive earnings surprises and are trading below           Gabelli Equity Income Fund                               (No-load)       Portfolio Manager: Mario J. Gabelli, CFA
Westwood’s proprietary growth rate estimates. The           Seeks to invest primarily in equity securities with
Fund’s primary objective is capital appreciation.           above market average yields. The Fund pays monthly CONTRARIAN _________________________________
(Multiclass)       Portfolio Manager: Susan M. Byrne        dividends and seeks a high level of total return with an GAMCO Mathers Fund
                                                            emphasis on income. (Multiclass)                         Seeks long-term capital appreciation in various market
FOCUSED VALUE ______________________________                              Portfolio Manager: Mario J. Gabelli, CFA conditions without excessive risk of capital loss.
Gabelli Value Fund
Seeks to invest in securities of companies believed to                                                               (Class AAA-No-load)
be undervalued. The Fund’s primary objective is long-                                                                            Portfolio Manager: Henry Van der Eb, CFA
                                                            Westwood Balanced Fund
term capital appreciation. (Multiclass)                     Seeks to invest in a balanced and diversified portfolio Comstock Capital Value Fund
              Portfolio Manager: Mario J. Gabelli, CFA      of stocks and bonds. The Fund’s primary objective is Seeks capital appreciation and current income. The
                                                            both capital appreciation and current income.            Fund may use either long or short positions to achieve
SMALL CAP VALUE ____________________________                (Multiclass)                                             its objective. (Multiclass)
Gabelli Small Cap Fund                                                 Co-Portfolio Managers: Susan M. Byrne                          Portfolio Manager: Martin Weiner, CFA
Seeks to invest primarily in common stock of smaller                                           Mark Freeman, CFA Comstock Strategy Fund
companies (market capitalizations less than $1
billion) believed to have rapid revenue and earnings                                                                  The Fund emphasizes investments in debt securities,
growth potential. The Fund’s primary objective is                                                                     which maximize total return in light of credit risk,
capital appreciation. (Multiclass)                       Westwood Income Fund                                         interest rate risk, and the risk associated with the
                                                         Seeks to provide a high level of current income as well      length of maturity of debt instruments. (Multiclass)
               Portfolio Manager: Mario J. Gabelli, CFA
                                                         as long-term capital appreciation by investing in                            Portfolio Manager: Martin Weiner, CFA
                                                         income producing equity and fixed income securities.
Westwood SmallCap Equity Fund                            (Multiclass)                            Team Managed
Seeks to invest primarily in smaller capitalization                                                                   FIXED INCOME ________________________________
equity securities – market caps of $2.5 billion or less.                                                              Westwood Intermediate Bond Fund
The Fund’s primary objective is long-term capital                                                                     Seeks to invest in a diversified portfolio of bonds with
appreciation. (Multiclass)               Team Managed SPECIALTY EQUITY ____________________________                   various maturities. The Fund’s primary objective is
                                                         GAMCO Global Convertible Securities Fund                     total return. (Multiclass)
Gabelli Woodland Small Cap Value Fund                    Seeks to invest principally in bonds and preferred                          Portfolio Manager: Mark Freeman, CFA
Seeks to invest primarily in the common stocks of stocks which are convertible into common stock of
smaller companies (market capitalizations less than foreign and domestic companies. The Fund’s primary
$1.5 billion) believed to be undervalued with objective is total return through a combination of                      CASH MANAGEMENT-MONEY MARKET __________
shareholder oriented management teams that are current income and capital appreciation. (Multiclass)                  Gabelli U.S. Treasury Money Market Fund
                                                                                                  Team Managed        Seeks to invest exclusively in short-term U.S. Treasury
employing strategies to grow the company’s value.
The Fund’s primary objective is capital appreciation.                                                                 securities. The Fund’s primary objective is to provide
(Multiclass)                                                                                                          high current income consistent with the preservation
                                                                                                                      of principal and liquidity. (No-load)
              Portfolio Manager: Elizabeth M. Lilly, CFA GAMCO Global Opportunity Fund
                                                         Seeks to invest in common stock of companies which                              Portfolio Manager: Judith A. Raneri
GROWTH ______________________________________ have rapid growth in revenues and earnings and
                                                         potential for above average capital appreciation or are
GAMCO Growth Fund
                                                         undervalued. The Fund’s primary objective is capital
                                                                                                                      An investment in the above Money Market Fund is
Seeks to invest primarily in large cap stocks believed appreciation. (Multiclass)                Team Managed         neither insured nor guaranteed by the Federal Deposit
to have favorable, yet undervalued, prospects for                                                                     Insurance Corporation or any government agency.
earnings growth. The Fund’s primary objective is                                                                      Although the Fund seeks to preserve the value of your
capital appreciation. (Multiclass)
                Portfolio Manager: Howard F. Ward, CFA SECTOR ______________________________________                  investment at $1.00 per share, it is possible to lose
                                                                                                                      money by investing in the Fund.
                                                         GAMCO Global Telecommunications Fund
GAMCO International Growth Fund                          Seeks to invest in telecommunications companies              The Funds may invest in foreign securities which involve
Seeks to invest in the equity securities of foreign throughout the world – targeting undervalued
                                                                                                                      risks not ordinarily associated with investments in
issuers with long-term capital appreciation potential. companies with strong earnings and cash flow
The Fund offers investors global diversification. dynamics. The Fund’s primary objective is capital                   domestic issues, including currency fluctuation,
(Multiclass)           Portfolio Manager: Caesar Bryan appreciation. (Multiclass)                Team Managed         economic, and political risks.

  To receive a prospectus, call 800-GABELLI (422-3554). Investors should carefully consider the investment objectives, risks, charges, and expenses of the Fund
              before investing. The prospectus contains more information about this and other matters and should be read carefully before investing.
             The Gabelli Value Fund Inc.
                     One Corporate Center
                   Rye, New York 10580-1422
                         800-GABELLI                                                    E
                                                                                        P
                                                                                                P
                                                                                                M
                                                                                        S       V
                         800-422-3554
                       fax: 914-921-5118
                website: www.gabelli.com                                                MANAGEMENT

                e-mail: info@gabelli.com                                                CASH FLOW
          Net Asset Value available daily by calling
               800-GABELLI after 6:00 P.M.                                            RE S E A R C H


                       Board of Directors
Mario J. Gabelli, CFA                   Anthony R. Pustorino
Chairman and Chief                      Certified Public Accountant,
Executive Officer                       Professor Emeritus
GAMCO Investors, Inc.                   Pace University

Anthony J. Colavita                     Werner J. Roeder, MD
Attorney-at-Law                         Medical Director
Anthony J. Colavita, P.C.               Lawrence Hospital
                                                                        The
Robert J. Morrissey
Attorney-at-Law
Morrissey, Hawkins & Lynch                                              Gabelli
                             Officers
Bruce N. Alpert
President
                                        James E. McKee
                                        Secretary                       Value
Agnes Mullady                           Peter D. Goldstein
Treasurer

                            Custodian
                                        Chief Compliance Officer
                                                                        Fund
                  Mellon Trust of New England, N.A.

     Transfer Agent and Dividend Disbursing Agent
             State Street Bank and Trust Company
                                                                        Inc.
                          Legal Counsel
                    Willkie Farr & Gallagher LLP

                           Distributor
                      Gabelli & Company, Inc.

This report is submitted for the general information of the
shareholders of The Gabelli Value Fund Inc. It is not authorized for
distribution to prospective investors unless preceded or accompanied   SHAREHOLDER COMMENTARY
by an effective prospectus.
                                                                                   JUNE 30, 2006
GAB409Q206SC
                                    The Gabelli Value Fund Inc.
                                                            Semi-Annual Report
                                                              June 30, 2006
To Our Shareholders,
     During the second quarter of 2006, The Gabelli Value Fund Inc. (the “Fund”) rose 1.0%, while the
Standard & Poor’s (“S&P”) 500 Index declined 1.4% and the Dow Jones Industrials Average rose 0.9%. For the
six month period ended June 30, 2006, the Fund was up 8.2% versus gains of 2.7% and 5.3% for the S&P 500
Index and the Dow Jones Industrial Average, respectively.
      Enclosed are the financial statements and the investment portfolio as of June 30, 2006.
Comparative Results
                                           Average Annual Returns through June 30, 2006 (a)
                                                                                                                               Since
                                                             Year to                                                         Inception
                                             Quarter          Date     1 Year     3 Year     5 Year    10 Year    15 Year    (9/29/89)
 Gabelli Value Fund Class A . . . 1.03%                      8.23%      8.22%     12.56%     5.43%     11.80% 13.67% 12.64%
                                 (4.53)(b)                   2.27(b)    2.26(b)   10.46(b)   4.24(b)   11.17(b) 13.24(b) 12.27(b)
 S&P 500 Index . . . . . . . . . . . . . . (1.44)             2.71      8.62      11.21      2.49       8.32      10.73      10.35
 Dow Jones Industrial Average . . 0.93                        5.25     11.07       9.95      3.47       9.17      11.87      11.50
 Nasdaq Composite Index . . . . . . (7.17)                   (1.51)     5.60      10.21      0.10       6.25      10.65       9.53
 Class B . . . . . . . . . . . . . . . . . . . . 0.81        7.81       7.45      11.73      4.63      11.27      13.31      12.33
                                                (4.19)(c)    2.81(c)    2.45(c)   10.93(c)   4.30(c)   11.27(c)   13.31(c)   12.33(c)
 Class C . . . . . . . . . . . . . . . . . . . . 0.81        7.81       7.44      11.72      4.64      11.30      13.33      12.35
                                                (0.19)(c)    6.81(c)    6.44(c)   11.72(c)   4.64(c)   11.30(c)   13.33(c)   12.35(c)
 (a) Returns represent past performance and do not guarantee future results. Total returns and average annual returns
     reflect changes in share price and reinvestment of distributions and are net of expenses. Investment returns and the
     principal value of an investment will fluctuate. When shares are redeemed, they may be worth more or less than their
     original cost. Performance returns for periods less than one year are not annualized. Current performance may be
     lower or higher than the performance data presented. Visit www.gabelli.com for performance information as of the
     most recent month end. Investors should carefully consider the investment objectives, risks, charges, and
     expenses of the Fund before investing. The prospectus contains more information about this and other
     matters and should be read carefully before investing.
     The Class A Shares’ net asset values are used to calculate performance for the periods prior to the issuance of Class
     B Shares and Class C Shares on March 15, 2000. The actual performance for the Class B Shares and Class C
     Shares would have been lower due to the additional expenses associated with these classes of shares. The Dow
     Jones Industrial Average is an unmanaged index of 30 large capitalization stocks. The S&P 500 Index and the
     Nasdaq Composite Index are unmanaged indicators of stock market performance. Dividends are reinvested except
     for the Nasdaq Composite Index.
 (b) Includes the effect of the maximum 5.5% sales charge at the beginning of the period.
 (c) Includes the effect of the applicable contingent deferred sales charge at the end of the period shown for Class B and
     Class C Shares, respectively. Class B Shares are not available for new purchases.

 We have separated the portfolio manager’s commentary from the financial statements and investment portfolio due to
 corporate governance regulations stipulated by the Sarbanes-Oxley Act of 2002. We have done this to ensure that the
 content of the portfolio manager’s commentary is unrestricted. The financial statements and investment portfolio are
 mailed separately from the commentary. Both the commentary and the financial statements, including the portfolio of
 investments, will be available on our website at www.gabelli.com/funds.
The Gabelli Value Fund Inc.
Disclosure of Fund Expenses (Unaudited)
For the Six Month Period from January 1, 2006 through June 30, 2006                                     Expense Table
We believe it is important for you to understand the         Hypothetical 5% Return: This section provides
impact of fees and expenses regarding your                   information about hypothetical account values and
investment. All mutual funds have operating                  hypothetical expenses based on the Fund’s actual
expenses. As a shareholder of a fund, you incur              expense ratio. It assumes a hypothetical annualized
ongoing costs, which include costs for portfolio             return of 5% before expenses during the period shown.
management,       administrative    services,     and        In this case – because the hypothetical return used is
shareholder reports (like this one), among others.           not the Fund’s actual return – the results do not apply
Operating expenses, which are deducted from a                to your investment and you cannot use the hypothetical
fund’s gross income, directly reduce the investment          account value and expense to estimate the actual
return of a fund. When a fund’s expenses are                 ending account balance or expenses you paid for the
expressed as a percentage of its average net assets,         period. This example is useful in making comparisons
this figure is known as the expense ratio. The               of the ongoing costs of investing in the Fund and other
following examples are intended to help you                  funds. To do so, compare this 5% hypothetical example
understand the ongoing costs (in dollars) of investing       with the 5% hypothetical examples that appear in
in your Fund and to compare these costs with those           shareholder reports of other funds.
of other mutual funds. The examples are based on an
                                                             Please note that the expenses shown in the table are
investment of $1,000 made at the beginning of the
                                                             meant to highlight your ongoing costs only and do
period shown and held for the entire period.                 not reflect any transactional costs such as sales
The Expense Table below illustrates your Fund’s              charges (loads), redemption fees, or exchange fees,
costs in two ways:                                           if any, which are described in the Prospectus. If these
                                                             costs were applied to your account, your costs would
Actual Fund Return: This section provides                    be higher. Therefore, the 5% hypothetical return is
information about actual account values and actual           useful in comparing ongoing costs only, and will not
expenses. You may use this section to help you to            help you determine the relative total costs of owning
estimate the actual expenses that you paid over the          different funds. The “Annualized Expense Ratio”
period after any fee waivers and expense                     represents the actual expenses for the last six
reimbursements. The “Ending Account Value” shown             months and may be different from the expense ratio
is derived from the Fund’s actual return during the          in the Financial Highlights which is for the six months
past six months, and the “Expenses Paid During               ended June 30, 2006.
Period” shows the dollar amount that would have                                Beginning      Ending     Annualized    Expenses
been paid by an investor who started with $1,000 in                          Account Value Account Value Expense      Paid During
                                                                               01/01/06      06/30/06      Ratio        Period*
the Fund. You may use this information, together with
                                                             The Gabelli Value Fund Inc.
the amount you invested, to estimate the expenses
                                                             Actual Fund Return
that you paid over the period.                               Class A         $1,000.00      $1,082.30     1.42%        $ 7.33
                                                             Class B         $1,000.00      $1,078.10     2.17%        $11.18
To do so, simply divide your account value by $1,000         Class C         $1,000.00      $1,078.10     2.17%        $11.18
(for example, an $8,600 account value divided by             Hypothetical 5% Return
$1,000 = 8.6), then multiply the result by the number        Class A         $1,000.00      $1,017.75     1.42%        $ 7.10
given for your Fund under the heading “Expenses              Class B         $1,000.00      $1,014.03     2.17%        $10.84
                                                             Class C         $1,000.00      $1,014.03     2.17%        $10.84
Paid During Period” to estimate the expenses you
                                                             * Expenses are equal to the Fund’s annualized expense ratio for
paid during this period.                                       the last six months multiplied by the average account value over
                                                               the period, multiplied by the number of days in the most recent
                                                               fiscal half-year, then divided by 365.
                                                         2
Summary of Portfolio Holdings (Unaudited)
The following table presents portfolio holdings as a percent of total net assets as of June 30, 2006:

The Gabelli Value Fund Inc.
Entertainment . . . . . . . . . . . . . . . . . . . . .       11.9%       Hotels and Gaming . . . . . . . . . . . . . . . . .                    2.6%
Publishing . . . . . . . . . . . . . . . . . . . . . . . .    10.8%       Consumer Services . . . . . . . . . . . . . . . . .                    2.2%
Cable and Satellite. . . . . . . . . . . . . . . . . .         8.4%       Automotive: Parts and Accessories . . . . .                            2.2%
Telecommunications . . . . . . . . . . . . . . . .             7.5%       Aviation: Parts and Services . . . . . . . . . .                       1.9%
Food and Beverage . . . . . . . . . . . . . . . . .            5.8%       Specialty Chemicals . . . . . . . . . . . . . . . .                    1.2%
Broadcasting . . . . . . . . . . . . . . . . . . . . . .       5.6%       Agriculture . . . . . . . . . . . . . . . . . . . . . . . .            0.9%
Metals and Mining . . . . . . . . . . . . . . . . . .          4.8%       Aerospace . . . . . . . . . . . . . . . . . . . . . . . .              0.9%
Diversified Industrial. . . . . . . . . . . . . . . . .        4.7%       Manufactured Housing. . . . . . . . . . . . . . .                      0.6%
Financial Services . . . . . . . . . . . . . . . . . .         4.3%       Retail . . . . . . . . . . . . . . . . . . . . . . . . . . . .         0.6%
Energy and Utilities . . . . . . . . . . . . . . . . .         3.7%       Machinery . . . . . . . . . . . . . . . . . . . . . . . .              0.6%
Equipment and Supplies . . . . . . . . . . . . .               3.4%       Real Estate . . . . . . . . . . . . . . . . . . . . . . .              0.5%
Electronics . . . . . . . . . . . . . . . . . . . . . . . .    3.1%       Wireless Communications . . . . . . . . . . . .                        0.3%
Consumer Products . . . . . . . . . . . . . . . . .            3.0%       Computer Software and Services . . . . . .                             0.2%
Repurchase Agreements . . . . . . . . . . . . .                2.9%       Business Services . . . . . . . . . . . . . . . . . .                  0.2%
Environmental Services . . . . . . . . . . . . . .             2.7%       Transportation . . . . . . . . . . . . . . . . . . . . .               0.0%
Communications Equipment . . . . . . . . . .                   2.7%       Other Assets and Liabilities (Net) . . . . . .                       (0.2)%
                                                                                                                                            ---------------
                                                                                                                                           ----------------
                                                                                                                                           100.0%
                                                                                                                                            ---------------
                                                                                                                                           ----------------
                                                                                                                                            ---------------
                                                                                                                                           ----------------
The Fund files a complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal
year on Form N-Q, the last of which was filed for the quarter ended March 31, 2006. Shareholders may obtain this
information at www.gabelli.com or by calling the Fund at 800-GABELLI (800-422-3554). The Fund’s Form N-Q is
available on the SEC’s website at www.sec.gov and may also be reviewed and copied at the Commission’s Public
Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained
by calling 1-800-SEC-0330.

Proxy Voting
The Fund files Form N-PX with its complete proxy voting record for the 12 months ended June 30th, no later than
August 31st of each year. A description of the Fund’s proxy voting policies, procedures, and how the Fund voted
proxies relating to portfolio securities is available without charge, upon request, (i) by calling 800-GABELLI
(800-422-3554); (ii) by writing to The Gabelli Funds at One Corporate Center, Rye, NY 10580-1422; and (iii) by
visiting the Securities and Exchange Commission’s website at www.sec.gov.




                                                                      3
The Gabelli Value Fund Inc.
Schedule of Investments — June 30, 2006 (Unaudited)

                                                                                                                        Market                                                                                                                                       Market
  Shares                                                                              Cost                              Value                           Shares                                                          Cost                                         Value
  ——–—                                                                                ——                                ——–—                            ——–—                                                            —     —                                      ——–—
             COMMON STOCKS — 97.3%                                                                                                                       15,000 Liberty Global Inc., Cl. C† . . $                            256,685                    $              308,550
             Aerospace — 0.9%                                                                                                                           302,000 Rogers Communications Inc.,
     1,000   Lockheed Martin Corp. . . . . . $                               25,800 $                                        71,740                                Cl. B . . . . . . . . . . . . . . . . .              2,470,978                                     12,200,800
                                                                                                                                                                                                           ------------------------------------------   -----------------------------------------------
 1,000,000   Rolls-Royce Group plc† . . . .                         7,007,796                                       7,655,750                                                                                       23,590,702                                        73,768,650
53,800,000   Rolls-Royce Group plc, Cl. B                                    55,145                                      101,975                                                                           ------------------------------------------   -----------------------------------------------
                                                       ------------------------------------------ -----------------------------------------------               Communications Equipment — 2.7%
                                                                    7,088,741                                       7,829,465
                                                       ------------------------------------------ -----------------------------------------------       100,000 Agere Systems Inc.† . . . . . .                         1,576,057                                         1,470,000
             Agriculture — 0.9%                                                                                                                         429,000 Corning Inc.† . . . . . . . . . . . .                   3,895,784                                     10,377,510
  185,000    Archer-Daniels-Midland Co. . .                         2,275,910                                       7,636,800                           740,000 Lucent Technologies Inc.† . .                           3,096,298                                         1,790,800
   30,000    Mosaic Co.† . . . . . . . . . . . . .                       373,124                                         469,500                        390,000 Motorola Inc. . . . . . . . . . . . .                   4,128,840                                         7,858,500
                                                       ------------------------------------------ -----------------------------------------------
                                                                    2,649,034                                       8,106,300                           830,000 Nortel Networks Corp.† . . . .                          3,825,530                                         1,859,200
                                                       ------------------------------------------ -----------------------------------------------                                                          ------------------------------------------   -----------------------------------------------
                                                                                                                                                                                                                    16,522,509                                        23,356,010
             Automotive: Parts and Accessories — 2.2%                                                                                                                                                      ------------------------------------------   -----------------------------------------------
   38,000    China Yuchai                                                                                                                                       Computer Software and Services — 0.2%
                International Ltd.† . . . . . .                          300,576                                         277,780                         56,000 Yahoo! Inc.† . . . . . . . . . . . . .                  1,968,559                                         1,848,000
                                                                                                                                                                                                           ------------------------------------------   -----------------------------------------------
  450,000    Dana Corp. . . . . . . . . . . . . . .                 6,036,030                                       1,188,000
                                                                                                                                                                Consumer Products — 3.0%
  250,000    Genuine Parts Co. . . . . . . . .                      6,600,695                                   10,415,000
                                                                                                                                                         85,000 Energizer Holdings Inc.† . . .                          1,992,017                                        4,978,450
  275,000    Navistar International Corp.†                          7,392,667                                       6,767,750
                                                                                                                                                         93,000 Gallaher Group plc, ADR . . .                           2,374,002                                        5,816,220
   28,000    Proliance International Inc.†                               131,723                                         129,360
                                                       ------------------------------------------ -----------------------------------------------           500 Givaudan SA . . . . . . . . . . . . .                        135,440                                       393,645
                                                                20,461,691                                      18,777,890                              130,000 Hartmarx Corp.† . . . . . . . . .                            606,544                                       780,000
                                                       ------------------------------------------ -----------------------------------------------
             Aviation: Parts and Services — 1.9%                                                                                                          6,200 National Presto
   34,000    Curtiss-Wright Corp. . . . . . .                            441,649                                    1,049,920                                      Industries Inc. . . . . . . . . .                         179,358                                           324,136
  350,000    Fairchild Corp., Cl. A† . . . . .                      2,502,891                                            728,000                        175,000 Pactiv Corp.† . . . . . . . . . . . .                   1,690,548                                         4,331,250
  340,000    GenCorp Inc.† . . . . . . . . . . .                    3,135,471                                       5,450,200                           600,000 Swedish Match AB . . . . . . . .                        6,254,604                                         9,671,032
   80,000    Sequa Corp., Cl. A† . . . . . . .                      3,464,314                                       6,520,000                             4,000 Wolverine World Wide Inc. . .                                    38,937                                            93,320
                                                                                                                                                                                                           ------------------------------------------   -----------------------------------------------
   33,000    Sequa Corp., Cl. B† . . . . . . .                      1,673,268                                       2,697,750                                                                                       13,271,450                                        26,388,053
                                                       ------------------------------------------ -----------------------------------------------                                                          ------------------------------------------   -----------------------------------------------
                                                                11,217,593                                      16,445,870                                      Consumer Services — 2.2%
                                                       ------------------------------------------ -----------------------------------------------
             Broadcasting — 5.6%                                                                                                                         90,000 IAC/InterActiveCorp† . . . . . .                        1,685,751                                        2,384,100
 1,200,000   CBS Corp., Cl. A . . . . . . . . . . 21,763,305                                                    32,472,000                              720,000 Liberty Media Holding Corp. -
   132,000   Gray Television Inc. . . . . . . .                     1,558,505                                            764,280                                   Interactive, Cl. A† . . . . . . . 14,491,020                                                       12,427,200
   187,500   Liberty Media Holding Corp. -                                                                                                              205,000 Rollins Inc. . . . . . . . . . . . . . .                1,500,548                                         4,026,200
                                                                                                                                                                                                           ------------------------------------------   -----------------------------------------------
                Capital, Cl. A† . . . . . . . . . 11,537,181                                                    15,706,875                                                                                          17,677,319                                        18,837,500
                                                                                                                                                                                                           ------------------------------------------   -----------------------------------------------
   30,000    Young Broadcasting Inc.,
                                                                                                                                                                Diversified Industrial — 4.7%
                Cl. A† . . . . . . . . . . . . . . . .                   270,342                                             94,200
                                                       ------------------------------------------ -----------------------------------------------        49,000 Ampco-Pittsburgh Corp. . . .                                 245,017                                      1,403,850
                                                                35,129,333                                      49,037,355                               73,000 Cooper Industries Ltd., Cl. A                           4,890,363                                         6,783,160
                                                       ------------------------------------------ -----------------------------------------------
             Business Services — 0.2%                                                                                                                   210,000 Crane Co. . . . . . . . . . . . . . . .                 5,510,883                                         8,736,000
   15,000    ChoicePoint Inc.† . . . . . . . . .                         540,551                                         626,550                         29,000 Griffon Corp.† . . . . . . . . . . .                         644,825                                           756,900
   30,000    Intermec Inc.† . . . . . . . . . . .                        695,161                                         688,200                         50,000 Harbor Global Co. Ltd.† . . . .                                  88,471                                        455,500
   30,000    Nashua Corp.† . . . . . . . . . . .                         258,767                                         206,100                        375,000 Honeywell International Inc. . 11,514,241                                                             15,112,500
                                                       ------------------------------------------ -----------------------------------------------       150,000 ITT Industries Inc. . . . . . . . .                     5,499,219                                         7,425,000
                                                                    1,494,479                                       1,520,850
                                                       ------------------------------------------ -----------------------------------------------       220,000 Katy Industries Inc.† . . . . . .                       1,802,518                                              514,800
             Cable and Satellite — 8.4%                                                                                                                   3,000 Lamson & Sessions Co.† . . .                                     34,956                                            85,080
                                                                                                                                                                                                           ------------------------------------------   -----------------------------------------------
  130,000    Adelphia Communications                                                                                                                                                                                30,230,493                                        41,272,790
                Corp., Cl. A† . . . . . . . . . . .                          91,925                                              5,850                                                                     ------------------------------------------   -----------------------------------------------
 2,175,000   Cablevision Systems Corp.,                                                                                                                         Electronics — 3.1%
                Cl. A† . . . . . . . . . . . . . . . .              6,855,175                                   46,653,750                              220,000 Texas Instruments Inc. . . . . .                        5,563,627                                         6,663,800
  335,000    DIRECTV Group Inc.† . . . . . .                        5,907,032                                       5,527,500                            60,000 Thermo Electron Corp.† . . . .                          1,162,178                                         2,174,400
  120,000    EchoStar Communications                                                                                                                    300,000 Thomas & Betts Corp.† . . . .                           5,345,034                                     15,390,000
                Corp., Cl. A† . . . . . . . . . . .                 3,707,953                                       3,697,200                           110,000 Tyco International Ltd. . . . . .                       3,076,417                                         3,025,000
                                                                                                                                                                                                           ------------------------------------------   -----------------------------------------------
  250,000    Liberty Global Inc., Cl. A† . .                        4,300,954                                       5,375,000                                                                                       15,147,256                                        27,253,200
                                                                                                                                                                                                           ------------------------------------------   -----------------------------------------------
                                                                                           See accompanying notes to financial statements.

                                                                                                                                                    4
The Gabelli Value Fund Inc.
Schedule of Investments (Continued) — June 30, 2006 (Unaudited)

                                                                                                                  Market                                                                                                                                              Market
  Shares                                                                      Cost                                Value                                      Shares                                                                   Cost                            Value
  ——–—                                                                        ——                                  ——–—                                       ——–—                                                                     ——                              ——–—
             COMMON STOCKS (Continued)                                                                                                                               Food and Beverage — 5.8%
             Energy and Utilities — 3.7%                                                                                                                      17,000 Corn Products
    6,000    Allegheny Energy Inc.† . . . . . $                               74,092                 $                      222,420                                     International Inc. . . . . . . . $                    209,567                    $               520,200
   20,000    Chevron Corp. . . . . . . . . . . .                     1,223,550                                         1,241,200                              67,000 Del Monte Foods Co. . . . . . .                          508,135                                    752,410
  195,000    ConocoPhillips . . . . . . . . . . .                    5,417,216                                     12,778,350                                208,000 Diageo plc, ADR . . . . . . . . . .                 7,993,283                                    14,050,400
  110,000    Kerr-McGee Corp. . . . . . . . .                        3,962,186                                         7,628,500                             220,000 Flowers Foods Inc. . . . . . . . .                  1,587,151                                     6,300,800
    5,420    Mirant Corp.† . . . . . . . . . . . .                            25,619                                        145,256                           81,500 Fomento Economico Mexicano
  135,000    Northeast Utilities . . . . . . . . .                   2,589,737                                         2,790,450                                        SA de CV, ADR . . . . . . . . .                  2,988,579                                         6,823,180
   70,000    Southwest Gas Corp. . . . . . .                         1,400,502                                         2,193,800                              56,000 General Mills Inc. . . . . . . . . .                2,795,872                                         2,892,960
   59,600    TransMontaigne Inc.† . . . . . .                             666,308                                           668,116                          210,000 H.J. Heinz Co. . . . . . . . . . . . .              7,326,640                                         8,656,200
   72,755    Western Gas Resources Inc.                              4,349,067                                         4,354,387                              70,000 Kerry Group plc, Cl. A . . . . .                         797,221                                      1,485,524
                                                        ------------------------------------------   -----------------------------------------------
                                                                 19,708,277                                        32,022,479                                380,000 PepsiAmericas Inc. . . . . . . . .                  5,294,953                                         8,401,800
                                                        ------------------------------------------   -----------------------------------------------           3,000 The Hershey Co. . . . . . . . . . .                      145,382                                           165,210
             Entertainment — 11.9%                                                                                                                            15,000 Wm. Wrigley Jr. Co. . . . . . . .                        727,034                                           680,400
    8,570    Chestnut Hill Ventures† (a) . .                              233,241                                          184,031                             3,750 Wm. Wrigley Jr. Co., Cl. B . .                           193,262                                           169,875
  400,000    Discovery Holding Co.,                                                                                                                                                                         ------------------------------------------   -----------------------------------------------
                                                                                                                                                                                                                     30,567,079                                        50,898,959
                Cl. A† . . . . . . . . . . . . . . . .               4,551,612                                        5,852,000                                                                             ------------------------------------------   -----------------------------------------------
    60,000   Dover Motorsports Inc. . . . .                               309,314                                       352,200                                      Hotels and Gaming — 2.6%
 1,300,000   Gemstar-TV Guide                                                                                                                                 18,000 Aztar Corp.† . . . . . . . . . . . . .                   197,676                                          935,280
                International Inc.† . . . . . .                      6,278,509                                         4,576,000                              72,000 Dover Downs Gaming &
   330,000   Grupo Televisa SA, ADR . . . .                          3,045,483                                         6,372,300                                        Entertainment Inc. . . . . . .                        483,202                                      1,414,080
   170,000   The Walt Disney Co. . . . . . . .                       4,427,710                                         5,100,000                             190,000 Gaylord Entertainment Co.† . .                      5,345,735                                         8,291,600
 1,260,000   Time Warner Inc. . . . . . . . . . 18,053,221                                                         21,798,000                                177,500 Hilton Hotels Corp. . . . . . . . .                 1,385,106                                         5,019,700
    34,000   Triple Crown Media Inc.† . . .                               365,718                                           294,780                            3,000 Kerzner International Ltd.† . .                          239,530                                           237,840
 1,225,000   Viacom Inc., Cl. A† . . . . . . . . 34,565,509                                                        44,038,750                                352,941 Ladbrokes plc . . . . . . . . . . . .               3,502,007                                         2,659,606
   450,000   Vivendi SA, ADR . . . . . . . . . .                     6,072,068                                     15,709,500                                 19,000 Las Vegas Sands Corp.† . . .                             670,772                                      1,479,340
                                                        ------------------------------------------   -----------------------------------------------
                                                                 77,902,385                                    104,277,561                                    65,000 MGM Mirage† . . . . . . . . . . .                   1,478,602                                         2,652,000
                                                        ------------------------------------------   -----------------------------------------------                                                        ------------------------------------------   -----------------------------------------------
                                                                                                                                                                                                                     13,302,630                                        22,689,446
             Environmental Services — 2.7%                                                                                                                                                                  ------------------------------------------   -----------------------------------------------
  240,000    Republic Services Inc. . . . . .                        4,425,922                                         9,681,600                                     Machinery — 0.6%
  390,000    Waste Management Inc. . . . .                           9,151,151                                     13,993,200                                 85,800 CNH Global NV . . . . . . . . . . .                 1,604,960                                         2,052,336
                                                        ------------------------------------------   -----------------------------------------------
                                                                 13,577,073                                        23,674,800                                 38,000 Deere & Co. . . . . . . . . . . . . .               1,565,024                                         3,172,620
                                                        ------------------------------------------   -----------------------------------------------                                                        ------------------------------------------   -----------------------------------------------
                                                                                                                                                                                                                         3,169,984                                         5,224,956
             Equipment and Supplies — 3.4%                                                                                                                                                                  ------------------------------------------   -----------------------------------------------
  210,000    CIRCOR International Inc. . .                           2,325,092                                     6,402,900                                         Manufactured Housing — 0.6%
  185,000    Flowserve Corp.† . . . . . . . . .                      2,864,920                                    10,526,500                                 485,000 Champion Enterprises Inc.† . .                      4,782,947                                         5,354,400
                                                                                                                                                                                                            ------------------------------------------   -----------------------------------------------
   95,000    Gerber Scientific Inc.† . . . . .                            650,912                                  1,235,950
                                                                                                                                                                     Metals and Mining — 4.8%
   98,000    GrafTech International Ltd.† . .                        1,196,563                                       568,400
                                                                                                                                                             478,000 Barrick Gold Corp. . . . . . . . .                  7,651,550                                     14,148,800
  330,000    Watts Water Technologies Inc.,
                                                                                                                                                              30,000 Falconbridge Ltd. . . . . . . . . .                 1,546,633                                         1,585,500
                Cl. A . . . . . . . . . . . . . . . . .              4,325,964                                     11,071,500
                                                        ------------------------------------------   -----------------------------------------------         123,133 Kinross Gold Corp.† . . . . . . .                   1,119,195                                         1,340,918
                                                                 11,363,451                                        29,805,250                                471,000 Newmont Mining Corp. . . . .                        9,100,344                                     24,930,030
                                                        ------------------------------------------   -----------------------------------------------                                                        ------------------------------------------   -----------------------------------------------
             Financial Services — 4.3%                                                                                                                                                                               19,417,722                                        42,005,248
                                                                                                                                                                                                            ------------------------------------------   -----------------------------------------------
  530,000    American Express Co. . . . . . 17,244,922                                                             28,206,600
                                                                                                                                                                     Publishing — 10.8%
  100,000    Ameriprise Financial Inc. . . .                         2,346,124                                         4,467,000
                                                                                                                                                             150,000 Belo Corp., Cl. A . . . . . . . . . .               2,592,090                                     2,340,000
   27,000    Deutsche Bank AG . . . . . . . .                        1,569,799                                         3,037,500
                                                                                                                                                             925,000 Media General Inc., Cl. A . . . 18,185,500                                                       38,748,250
  110,000    Phoenix Companies Inc. . . . .                          1,214,393                                         1,548,800
                                                        ------------------------------------------   -----------------------------------------------          70,000 Meredith Corp. . . . . . . . . . . .                1,404,532                                     3,467,800
                                                                 22,375,238                                        37,259,900                              1,110,000 News Corp., Cl. A . . . . . . . . . 16,418,747                                                   21,289,800
                                                        ------------------------------------------   -----------------------------------------------
                                                                                                                                                             332,000 PRIMEDIA Inc.† . . . . . . . . . .                       962,615                                    607,560




                                                                                   See accompanying notes to financial statements.

                                                                                                                                                       5
The Gabelli Value Fund Inc.
Schedule of Investments (Continued) — June 30, 2006 (Unaudited)

                                                                                                               Market                                               Principal                                                                                                                           Market
  Shares                                                                    Cost                               Value                                                Amount                                                                                  Cost                                          Value
  ——–—                                                                      ——                                 ——–—                                                  ——–—                                                                                   —     —                                     ——–—
             COMMON STOCKS (Continued)                                                                                                                                                                        REPURCHASE AGREEMENTS — 2.9%
             Publishing (Continued)                                                                                                                             $25,300,000 Barclays Capital Inc.,
  300,000    Reader’s Digest                                                                                                                                                                                         4.400%, dated 6/30/06,
                Association Inc. . . . . . . . . $ 4,510,861                                      $                 4,188,000                                                                                        due 07/03/06, proceeds at
  300,000    The E.W. Scripps Co., Cl. A . . 10,208,574                                                         12,942,000                                                                                           maturity, $25,309,277 (b) $ 25,300,000 $ 25,300,000
                                                                                                                                                                                                                                               ------------------------------------------ -----------------------------------------------
  330,000    Tribune Co. . . . . . . . . . . . . . . 13,661,669                                                 10,701,900
                                                     ------------------------------------------   -----------------------------------------------                                                             TOTAL
                                                              67,944,588                                        94,285,310                                                                                           INVESTMENTS — 100.2% $ 564,770,603                                             875,148,458
                                                     ------------------------------------------   -----------------------------------------------                                                                                              ------------------------------------------
                                                                                                                                                                                                                                               ------------------------------------------
             Real Estate — 0.5%
                                                                                                                                                                                                              Other Assets and Liabilities (Net) — (0.2)%                                                (1,776,227)
  134,000    Griffin Land &                                                                                                                                                                                                                                                               -----------------------------------------------
                Nurseries Inc.† . . . . . . . . .                 1,587,460                                         4,187,500                                                                                 NET ASSETS — 100.0% . . . . . . . . . . . . . . . $ 873,372,231
                                                     ------------------------------------------   -----------------------------------------------                                                                                                                                         -----------------------------------------------
                                                                                                                                                                                                                                                                                          -----------------------------------------------
             Retail — 0.6%                                                                                                                              --------------------------------------------------------------
   85,000    Ingles Markets Inc., Cl. A . . .                          976,701                                      1,445,000                            (a) Security fair valued under procedures established by the Board of
  145,000    Safeway Inc. . . . . . . . . . . . . .               2,964,686                                         3,770,000                                             Directors. The procedures may include reviewing available financial
    1,820    SUPERVALU Inc. . . . . . . . . .                              54,145                                            55,874                                       information about the company and reviewing the valuation of comparable
                                                     ------------------------------------------   -----------------------------------------------                         securities and other factors on a regular basis. At June 30, 2006, the
                                                                  3,995,532                                         5,270,874
                                                     ------------------------------------------   -----------------------------------------------                         market value of the fair valued security amounted to $184,031 or 0.02%
             Specialty Chemicals — 1.2%                                                                                                                                   of total net assets.
  220,000    Ferro Corp. . . . . . . . . . . . . . .              4,605,734                                         3,511,200                            (b) Collateralized by U.S. Treasury Bond, 7.68%, due 02/15/21, market value
  400,000    Hercules Inc.† . . . . . . . . . . .                 5,049,452                                         6,104,000                                             $25,806,000.
   15,000    Sensient Technologies Corp.                               300,492                                           313,650                         †                Non-income producing security.
    8,065    Tronox Inc., Cl. B . . . . . . . . .                          78,763                                        106,216                         ADR American Depository Receipt
                                                     ------------------------------------------   -----------------------------------------------
                                                              10,034,441                                        10,035,066
                                                     ------------------------------------------   -----------------------------------------------
             Telecommunications — 7.5%
  650,000    Cincinnati Bell Inc.† . . . . . . .                  2,508,755                                        2,665,000
   25,000    Commonwealth Telephone
                Enterprises Inc. . . . . . . . .                       989,702                                       829,000
   74,500    Embarq Corp.† . . . . . . . . . . .                  2,005,804                                        3,053,755
  530,000    Qwest Communications
                International Inc.† . . . . . .                   1,421,227                                     4,287,700
 1,490,000   Sprint Nextel Corp. . . . . . . . . 20,280,904                                                    29,785,100
   425,000   Telephone & Data
                Systems Inc. . . . . . . . . . .                  9,269,310                                    17,595,000
  185,000    Telephone & Data
                Systems Inc., Special . . . .                     4,120,871                                         7,196,500
                                                     ------------------------------------------   -----------------------------------------------
                                                              40,596,573                                        65,412,055
                                                     ------------------------------------------   -----------------------------------------------
             Transportation — 0.0%
   99,000    Grupo TMM SA, Cl. A, ADR†                                 780,160                                           402,930
                                                     ------------------------------------------   -----------------------------------------------
             Wireless Communications — 0.3%
   40,000    United States Cellular Corp.†                        1,880,524                                         2,424,000
                                                     ------------------------------------------   -----------------------------------------------
             TOTAL COMMON STOCKS . . 539,435,223                                                            849,672,667
                                                     ------------------------------------------   -----------------------------------------------
             WARRANTS — 0.0%
             Energy and Utilities — 0.0%
   17,405    Mirant Corp., Ser. A,
                expire 01/03/11† . . . . . . .                             35,380                                        175,791
                                                     ------------------------------------------   -----------------------------------------------




                                                                                See accompanying notes to financial statements.

                                                                                                                                                    6
                                                                   The Gabelli Value Fund Inc.
Statement of Assets and Liabilities                                                              Statement of Operations
June 30, 2006 (Unaudited)                                                                        For the Six Months Ended June 30, 2006 (Unaudited)

Assets:                                                                                          Investment Income:
  Investments, at value (cost $564,770,603) . . .                        $875,148,458              Dividends (net of foreign taxes of $149,781) . .                       $  9,593,048
  Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .            597              Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        683,455
                                                                                                                                                                           –— — —
                                                                                                                                                                          —– — — —
  Receivable for investments sold . . . . . . . . . . .                     1,626,364
                                                                                                    Total Investment Income . . . . . . . . . . . . . . .                   10,276,503
  Dividends and interest receivable . . . . . . . . . .                       620,513                                                                                      –— — —
                                                                                                                                                                          —– — — —
  Receivable for Fund shares sold . . . . . . . . . .                         226,486            Expenses:
  Other assets . . . . . . . . . . . . . . . . . . . . . . . . . .             19,154              Investment advisory fees . . . . . . . . . . . . . . . .                 5,152,146
                                                                          –— — — —
                                                                         —– — — —
   Total Assets . . . . . . . . . . . . . . . . . . . . . . . . . .       877,641,572              Distribution fees – Class A . . . . . . . . . . . . . . .                1,249,376
                                                                          –— — — —
                                                                         —– — — —                  Distribution fees – Class B . . . . . . . . . . . . . . .                   86,763
Liabilities:                                                                                       Distribution fees – Class C . . . . . . . . . . . . . . .                   67,878
  Payable for Fund shares redeemed . . . . . . . .                             1,291,511           Shareholder services fees . . . . . . . . . . . . . . .                    453,983
  Payable for investment advisory fees . . . . . . .                             710,046           Shareholder communications expenses . . . . .                              137,347
  Payable for investments purchased . . . . . . . .                            1,492,811           Custodian fees . . . . . . . . . . . . . . . . . . . . . . . .              68,573
  Payable for shareholder services fees . . . . . .                              348,064           Interest expense . . . . . . . . . . . . . . . . . . . . . . .              59,528
  Payable for distribution fees . . . . . . . . . . . . . .                      195,829           Legal and audit fees . . . . . . . . . . . . . . . . . . . .                34,502
  Payable for shareholder                                                                          Directors’ fees . . . . . . . . . . . . . . . . . . . . . . . . .           34,200
    communications expenses . . . . . . . . . . . . .                         163,908              Registration expenses . . . . . . . . . . . . . . . . . .                   21,642
  Other accrued expenses . . . . . . . . . . . . . . . .                       67,172              Miscellaneous expenses . . . . . . . . . . . . . . . . .                    76,483
                                                                          –— — — —
                                                                         —– — — —                                                                                          –— — —
                                                                                                                                                                          —– — — —
   Total Liabilities . . . . . . . . . . . . . . . . . . . . . . .          4,269,341               Total Expenses . . . . . . . . . . . . . . . . . . . . . . .            7,442,421
                                                                          –— — — —
                                                                         —– — — —
   Net Assets applicable to 44,650,506                                                              Less: Custodian fee credits . . . . . . . . . . . . . .                   (15,603)
                                                                                                                                                                           –— — —
                                                                                                                                                                          —– — — —
     shares outstanding . . . . . . . . . . . . . . . . . . .            $873,372,231               Net Expenses . . . . . . . . . . . . . . . . . . . . . . . .            7,426,818
                                                                          –— — — —
                                                                         —– — — —
                                                                          –— — — —
                                                                         —– — — —                                                                                          –— — —
                                                                                                                                                                          —– — — —
Net Assets Consist of:                                                                              Net Investment Income . . . . . . . . . . . . . . . .                   2,849,685
  Capital stock, each class at $0.001 par value                          $        44,651                                                                                   –— — —
                                                                                                                                                                          —– — — —
  Additional paid-in capital . . . . . . . . . . . . . . . . .               417,319,038         Net Realized and Unrealized Gain (Loss) on
  Accumulated net investment income . . . . . . .                              2,848,796           Investments and Foreign Currency:
  Accumulated net realized gain on investments                                                     Net realized gain on investments . . . . . . . . . .                    148,310,866
    and foreign currency transactions . . . . . . . .                        142,781,681           Net realized gain on foreign
  Net unrealized appreciation on investments . .                             310,377,855             currency transactions . . . . . . . . . . . . . . . . .                  11,867
                                                                                                                                                                           –— — —
                                                                                                                                                                          —– — — —
  Net unrealized appreciation on foreign
                                                                                                    Net realized gain on investments and
    currency translations . . . . . . . . . . . . . . . . . .                     210
                                                                          –— — — —
                                                                         —– — — —                     foreign currency transactions . . . . . . . . . . .                  148,322,733
   Net Assets . . . . . . . . . . . . . . . . . . . . . . . . . . .      $873,372,231               Net change in unrealized appreciation/
                                                                          –— — — —
                                                                          –— — — —
                                                                         —– — — —
                                                                         —– — — —
Shares of Capital Stock:                                                                              depreciation on investments and
  Class A:                                                                                            foreign currency translations . . . . . . . . . . .                  (65,656,373)
                                                                                                                                                                           –— — —
                                                                                                                                                                          —– — — —
  Net Asset Value and redemption price per share                                                    Net Realized and Unrealized Gain (Loss) on
    ($843,355,148 ÷ 43,039,271 shares                                                                 Investments and Foreign Currency . . . . .                            82,666,360
    outstanding; 100,000,000 shares                                                                                                                                        –— — —
                                                                                                                                                                          —– — — —
    authorized) . . . . . . . . . . . . . . . . . . . . . . . . .                $19.60             Net Increase in Net Assets Resulting
                                                                                  –—
                                                                                 —– —
                                                                                  –—
                                                                                 —– —                 from Operations . . . . . . . . . . . . . . . . . . . .             $ 85,516,045
   Maximum offering price per share (NAV ÷ .945,                                                                                                                           –— — —
                                                                                                                                                                          —– — — —
                                                                                                                                                                           –— — —
                                                                                                                                                                          —– — — —
    based on maximum sales charge of 5.50%
    of the offering price) . . . . . . . . . . . . . . . . . .                   $20.74
                                                                                  –—
                                                                                 —– —
                                                                                  –—
                                                                                 —– —
   Class B:
   Net Asset Value and offering price per share
     ($16,900,684 ÷ 907,398 shares outstanding;
     100,000,000 shares authorized) . . . . . . . . .                            $18.63(a)
                                                                                  –—
                                                                                 —– —
                                                                                  –—
                                                                                 —– —
   Class C:
   Net Asset Value and offering price per share
     ($13,116,399 ÷ 703,837 shares outstanding;
     50,000,000 shares authorized) . . . . . . . . . .                           $18.64(a)
                                                                                  –—
                                                                                 —– —
                                                                                  –—
                                                                                 —– —
(a) Redemption price varies based on length of time held.
                                          See accompanying notes to financial statements.

                                                                                             7
                                                            The Gabelli Value Fund Inc.
Statement of Changes in Net Assets

                                                                                                                                             Six Months Ended
                                                                                                                                                 June 30, 2006       Year Ended
                                                                                                                                                  (Unaudited)    December 31, 2005
Operations:                                                                                                                                     — — — — — — — — — — — —
                                                                                                                                             — — — — — — — — — — — —
  Net investment income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $             2,849,685   $       744,617
  Net realized gain on investments and foreign currency transactions . . . . . . . . . . . . . . . . . . . . .                                      148,322,733        77,766,169
  Net change in unrealized appreciation/depreciation on investments and
    foreign currency translations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .               (65,656,373)      (82,512,239)
                                                                                                                                                   — –– — —
                                                                                                                                                — —–— — —           — –– — —
                                                                                                                                                                  — —–— — —
  Net Increase (Decrease) in Net Assets Resulting from Operations . . . . . . . . . . . . . . . . . .                                                85,516,045        (4,001,453)
                                                                                                                                                   — –– — —
                                                                                                                                                — —–— — —           — –– — —
                                                                                                                                                                  — —–— — —
Distributions to Shareholders:
  Net investment income
    Class A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .              —           (666,736)
                                                                                                                                                   — –– — —
                                                                                                                                                — —–— — —           — –– — —
                                                                                                                                                                  — —–— — —
                                                                                                                                                             —           (666,736)
  Net realized gains on investments                                                                                                                — –– — —
                                                                                                                                                — —–— — —           — –– — —
                                                                                                                                                                  — —–— — —
    Class A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .              —        (73,800,544)
    Class B . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .              —         (1,289,884)
    Class C . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .              —         (1,025,214)
                                                                                                                                                   — –– — —
                                                                                                                                                — —–— — —           — –– — —
                                                                                                                                                                  — —–— — —
                                                                                                                                                             —        (76,115,642)
                                                                                                                                                   — –– — —
                                                                                                                                                — —–— — —           — –– — —
                                                                                                                                                                  — —–— — —
  Total Distributions to Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                                —        (76,782,378)
                                                                                                                                                   — –– — —
                                                                                                                                                — —–— — —           — –– — —
                                                                                                                                                                  — —–— — —
Capital Share Transactions
    Class A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    (302,923,749)     (120,095,977)
    Class B . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      (2,235,507)       (1,087,763)
    Class C . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      (1,929,899)       (1,199,523)
                                                                                                                                                   — –– — —
                                                                                                                                                — —–— — —           — –– — —
                                                                                                                                                                  — —–— — —
  Net Decrease in Net Assets from Capital Share Transactions . . . . . . . . . . . . . . . . . . . . . . .                                         (307,089,155)     (122,383,263)
                                                                                                                                                   — –– — —
                                                                                                                                                — —–— — —           — –– — —
                                                                                                                                                                  — —–— — —
  Redemption Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                   1,131            52,322
                                                                                                                                                   — –– — —
                                                                                                                                                — —–— — —           — –– — —
                                                                                                                                                                  — —–— — —
  Net Decrease in Net Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                 (221,571,979)     (203,114,772)
Net Assets:
  Beginning of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,094,944,210           1,298,058,982
                                                                                                                                                   — –– — —
                                                                                                                                                — —–— — —           — –– — —
                                                                                                                                                                  — —–— — —
  End of period (including undistributed net investment income of
    $2,848,796 and $0, respectively) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 873,372,231                    $1,094,944,210
                                                                                                                                                   — –– — —
                                                                                                                                                — —–— — —
                                                                                                                                                — —–— — —
                                                                                                                                                   — –– — —         — –– — —
                                                                                                                                                                  — —–— — —
                                                                                                                                                                    — –– — —
                                                                                                                                                                  — —–— — —
Notes to Financial Statements (Unaudited)

1. Organization. The Gabelli Value Fund Inc. (the “Fund”) was organized on July 20, 1989 as a Maryland
corporation. The Fund is a non-diversified open-end management investment company registered under the
Investment Company Act of 1940, as amended (the “1940 Act”). The Fund’s primary objective is long-term
capital appreciation. The Fund commenced investment operations on September 29, 1989.
2. Significant Accounting Policies. The preparation of financial statements in accordance with United States
(“U.S.”) generally accepted accounting principles requires 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 following is a summary of significant accounting policies followed by the Fund in the
preparation of its financial statements.
Security Valuation. Portfolio securities listed or traded on a nationally recognized securities exchange or traded in
the U.S. over-the-counter market for which market quotations are readily available are valued at the last quoted sale
price or a market’s official closing price as of the close of business on the day the securities are being valued. If
there were no sales that day, the security is valued at the average of the closing bid and asked prices or, if there
were no asked prices quoted on that day, then the security is valued at the closing bid price on that day. If no bid
or asked prices are quoted on such day, the security is valued at the most recently available price or, if the Board
of Directors (the “Board”) so determines, by such other method as the Board shall determine in good faith to reflect
                                                           8
The Gabelli Value Fund Inc.
Notes to Financial Statements (Continued) (Unaudited)

its fair market value. Portfolio securities traded on more than one national securities exchange or market are valued
according to the broadest and most representative market, as determined by Gabelli Funds, LLC (the “Adviser”).
Portfolio securities primarily traded on a foreign market are generally valued at the preceding closing values of
such securities on the relevant market, but may be fair valued pursuant to procedures established by the Board if
market conditions change significantly after the close of the foreign market but prior to the close of business on
the day the securities are being valued. Debt instruments with remaining maturities of 60 days or less that are not
credit impaired are valued at amortized cost, unless the Board determines such amount does not reflect the
securities’ fair value, in which case these securities will be fair valued as determined by the Board. Debt
instruments having a maturity greater than 60 days for which market quotations are readily available are valued
at the average of the latest bid and asked prices. If there were no asked prices quoted on such day, the security
is valued using the closing bid price. Futures contracts are valued at the closing settlement price of the exchange
or board of trade on which the applicable contract is traded.
Securities and assets for which market quotations are not readily available are fair valued as determined by the
Board. Fair valuation methodologies and procedures may include, but are not limited to: analysis and review of
available financial and non-financial information about the company; comparisons to the valuation and changes
in valuation of similar securities, including a comparison of foreign securities to the equivalent U.S. dollar value
ADR securities at the close of the U.S. exchange; and evaluation of any other information that could be
indicative of the value of the security.
Repurchase Agreements. The Fund may enter into repurchase agreements with primary government securities
dealers recognized by the Federal Reserve Board, with member banks of the Federal Reserve System, or with other
brokers or dealers that meet credit guidelines established by the Adviser and reviewed by the Board. Under the terms
of a typical repurchase agreement, the Fund takes possession of an underlying debt obligation subject to an
obligation of the seller to repurchase, and the Fund to resell, the obligation at an agreed-upon price and time, thereby
determining the yield during the Fund’s holding period. The Fund will always receive and maintain securities as
collateral whose market value, including accrued interest, will be at least equal to 102% of the dollar amount invested
by the Fund in each agreement. The Fund will make payment for such securities only upon physical delivery or upon
evidence of book entry transfer of the collateral to the account of the custodian. To the extent that any repurchase
transaction exceeds one business day, the value of the collateral is marked-to-market on a daily basis to maintain
the adequacy of the collateral. If the seller defaults and the value of the collateral declines or if bankruptcy
proceedings are commenced with respect to the seller of the security, realization of the collateral by the Fund may
be delayed or limited. At June 30, 2006, the Fund had an investment of $25,300,000 in a repurchase agreement.
Futures Contracts. The Fund may engage in futures contracts for the purpose of hedging against changes in
the value of its portfolio securities and in the value of securities it intends to purchase. Upon entering into a
futures contract, the Fund is required to deposit with the broker an amount of cash or cash equivalents equal
to a certain percentage of the contract amount. This is known as the “initial margin.” Subsequent payments
(“variation margin”) are made or received by the Fund each day, depending on the daily fluctuations in the value
of the contract, which are included in unrealized appreciation/depreciation on investments and futures
contracts. The Fund recognizes a realized gain or loss when the contract is closed.
There are several risks in connection with the use of futures contracts as a hedging instrument. The change in
value of futures contracts primarily corresponds with the value of their underlying instruments, which may not
correlate with the change in value of the hedged investments. In addition, there is the risk that the Fund may
                                                           9
The Gabelli Value Fund Inc.
Notes to Financial Statements (Continued) (Unaudited)

not be able to enter into a closing transaction because of an illiquid secondary market. At June 30, 2006, there
were no open futures contracts.
Securities Sold Short. The Fund may enter into short sale transactions. Short selling involves selling
securities that may or may not be owned and, at times, borrowing the same securities for delivery to the
purchaser, with an obligation to replace such borrowed securities at a later date. The proceeds received from
short sales are recorded as liabilities and the Fund records an unrealized gain or loss to the extent of the
difference between the proceeds received and the value of an open short position on the day of determination.
The Fund records a realized gain or loss when the short position is closed out. By entering into a short sale,
the Fund bears the market risk of an unfavorable change in the price of the security sold short. Dividends on
short sales are recorded as an expense by the Fund on the ex-dividend date and interest expense is recorded
on the accrual basis. The Fund did not hold any short positions as of June 30, 2006.
Foreign Currency Translations. The books and records of the Fund are maintained in U.S. dollars. Foreign
currencies, investments, and other assets and liabilities are translated into U.S. dollars at the current exchange
rates. Purchases and sales of investment securities, income, and expenses are translated at the exchange rate
prevailing on the respective dates of such transactions. Unrealized gains and losses that result from changes
in foreign exchange rates and/or changes in market prices of securities have been included in unrealized
appreciation/depreciation on investments and foreign currency translations. Net realized foreign currency gains
and losses resulting from changes in exchange rates include foreign currency gains and losses between trade
date and settlement date on investment securities transactions, foreign currency transactions, and the
difference between the amounts of interest and dividends recorded on the books of the Fund and the amounts
actually received. The portion of foreign currency gains and losses related to fluctuation in exchange rates
between the initial trade date and subsequent sale trade date is included in realized gain/(loss) on investments.
Foreign Securities. The Fund may directly purchase securities of foreign issuers. Investing in securities of
foreign issuers involves special risks not typically associated with investing in securities of U.S. issuers. The
risks include possible revaluation of currencies, the ability to repatriate funds, less complete financial
information about companies, and possible future adverse political and economic developments. Moreover,
securities of many foreign issuers and their markets may be less liquid and their prices more volatile than those
of securities of comparable U.S. issuers.
Foreign Taxes. The Fund may be subject to foreign taxes on income, gains on investments, or currency
repatriation, a portion of which may be recoverable. The Fund will accrue such taxes and recoveries as applicable,
based upon its current interpretation of tax rules and regulations that exist in the markets in which it invests.
Securities Transactions and Investment Income. Securities transactions are accounted for on the trade date with
realized gain or loss on investments determined by using the identified cost method. Interest income (including
amortization of premium and accretion of discount) is recorded on the accrual basis. Premiums and discounts on
debt securities are amortized using the effective yield to maturity method. Dividend income is recorded on the ex-
dividend date except for certain dividends which are recorded as soon as the Fund is informed of the dividend.
Determination of Net Asset Value and Calculation of Expenses. Certain administrative expenses are
common to, and allocated among, various affiliated funds. Such allocations are made on the basis of each


                                                       10
The Gabelli Value Fund Inc.
Notes to Financial Statements (Continued) (Unaudited)

Fund’s average net assets or other criteria directly affecting the expenses as determined by the Adviser
pursuant to procedures established by the Board.
In calculating the net asset value (“NAV”) per share of each class, investment income, realized and unrealized
gains and losses, redemption fees, and expenses other than class specific expenses, are allocated daily to
each class of shares based upon the proportion of net assets of each class at the beginning of each day.
Distribution expenses are borne solely by the class incurring the expense.
Custodian Fee Credits. When cash balances are maintained in the custody account, the Fund receives credits
which are used to offset custodian fees. The gross expenses paid under the custody arrangement are included
in custodian fees in the Statement of Operations with the corresponding expense offset, if any, shown as
“custodian fee credits”.
Distributions to Shareholders. Distributions to shareholders are recorded on the ex-dividend date.
Distributions to shareholders are based on income and capital gains as determined in accordance with Federal
income tax regulations, which may differ from income and capital gains as determined under U.S. generally
accepted accounting principles. These differences are primarily due to differing treatments of income and gains
on various investment securities and foreign currency transactions held by the Fund, timing differences, and
differing characterizations of distributions made by the Fund. Distributions from net investment income include
net realized gains on foreign currency transactions. These book/tax differences are either temporary or
permanent in nature. To the extent these differences are permanent, adjustments are made to the appropriate
capital accounts in the period when the differences arise. These reclassifications have no impact on the NAV
of the Fund. For the fiscal year ended December 31, 2005, reclassifications were made to increase
accumulated distributions in excess of net investment income by $78,770 and decrease accumulated
distributions in excess of net realized gain on investments by $78,770.
The tax character of distributions paid during the fiscal year ended December 31, 2005 was as follows:
                Distributions paid from:
                Ordinary income (inclusive of short-term
                  capital gains) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       $ 1,290,094
                Net long-term capital gains . . . . . . . . . . . . . . . . . . . . . . . . . .                 75,492,284
                                                                                                                — –— —
                                                                                                               — —– —
                Total distributions paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .           $76,782,378
                                                                                                                — –— —
                                                                                                               — —– —
                                                                                                                — –— —
                                                                                                               — —– —
Provision for Income Taxes. The Fund intends to continue to qualify as a regulated investment company
under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”). It is the policy of the
Fund to comply with the requirements of the Code applicable to regulated investment companies and to
distribute substantially all of its net investment company taxable income and net capital gains. Therefore, no
provision for Federal income taxes is required.
As of December 31, 2005, the components of accumulated earnings/(losses) on a tax basis were as follows:
                Undistributed ordinary income . . . . . . . . . . . . . . . . . . . . . . . .              $           820
                Undistributed long-term capital gains . . . . . . . . . . . . . . . . . . .                      1,032,106
                Net unrealized appreciation on investments and
                  foreign currency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        369,459,571
                                                                                                           ——–—–———
                Total accumulated gain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         $370,492,497
                                                                                                           ——–—–———
                                                                                                           ——–—–———


                                                                                   11
The Gabelli Value Fund Inc.
Notes to Financial Statements (Continued) (Unaudited)

The following summarizes the tax cost of investments and the related unrealized appreciation/depreciation at
June 30, 2006:
                                                                            Gross          Gross        Net Unrealized
                                                                          Unrealized     Unrealized      Appreciation/
                                                         Cost            Appreciation   Depreciation    (Depreciation)
                                                          ——               — — —
                                                                         — — — —          — — —
                                                                                        — — — —            — — — —
                                                                                                        —— — — —
                 Investments . . . . . . . . . . . . $571,310,253        $334,945,776   $(31,107,571)    $303,838,205

3. Investment Advisory Agreement. The Fund has entered into an investment advisory agreement (the
“Advisory Agreement”) with the Adviser which provides that the Fund will pay the Adviser a fee, computed daily
and paid monthly, at the annual rate of 1.00% of the value of its average daily net assets. In accordance with
the Advisory Agreement, the Adviser provides a continuous investment program for the Fund’s portfolio,
oversees the administration of all aspects of the Fund’s business and affairs, and pays the compensation of all
Officers and Directors of the Fund who are affiliated persons of the Adviser.
4. Distribution Plan. The Fund’s Board has adopted a distribution plan (the “Plan”) for each class of shares pursuant
to Rule 12b-1 under the 1940 Act. Gabelli & Company, Inc. (“Gabelli & Company”), an affiliate of the Adviser, serves
as distributor of the Fund. Under the Class A, Class B, and Class C Share Plans, payments are authorized to Gabelli
& Company at annual rates of 0.25%, 1.00%, and 1.00%, respectively, of the average daily net assets of those
classes, the annual limitations under each Plan. Such payments are accrued daily and paid monthly.
5. Portfolio Securities. Purchases and proceeds from the sales of securities for the six months ended June 30,
2006, other than short-term securities, aggregated $60,635,287 and $331,062,674, respectively.
6.Transactions with Affiliates. During the six months ended June 30, 2006, the Fund paid brokerage commissions
of $337,616 to Gabelli & Company. Additionally, Gabelli & Company informed the Fund that it received $51,305 from
investors representing commissions (sales charges and underwriting fees) on sales and redemptions of Fund
shares.
The cost of calculating the Fund’s NAV per share is a Fund expense pursuant to the Advisory Agreement
between the Fund and the Adviser. During the six months ended June 30, 2006, the Fund paid or accrued
$22,500 to the Adviser in connection with the cost of computing the Fund’s NAV, which is included in
miscellaneous expenses in the Statement of Operations.
7. Capital Stock Transactions. The Fund currently offers three classes of shares — Class A Shares, Class B
Shares, and Class C Shares. Class A Shares are subject to a maximum front-end sales charge of 5.50%. Class B
Shares are subject to a contingent deferred sales charge (“CDSC”) upon redemption within six years of purchase
and automatically convert to Class A Shares approximately eight years after the original purchase. The applicable
CDSC is equal to a declining percentage of the lesser of the NAV per share at the date of the original purchase or
at the date of redemption, based on the length of time held. Class C Shares are subject to a 1.00% CDSC for one
year after purchase. Class B Shares are available only through exchange of Class B Shares of other funds
distributed by Gabelli & Company. The Board has approved Class I Shares which have not been offered publicly.
Effective June 15, 2005, the Fund imposed a redemption fee of 2.00% on Class A Shares, Class B Shares,
and Class C Shares that are redeemed or exchanged on or before the seventh day after the date of a purchase.
(Prior to June 15, 2005, the Fund imposed a redemption fee on shares that were redeemed or exchanged on
or before the sixtieth day after the date of a purchase.) The redemption fee is deducted from the proceeds
otherwise payable to the redeeming shareholders and is retained by the Fund. The redemption fees retained
by the Fund during the six months ended June 30, 2006 and the fiscal year ended December 31, 2005
amounted to $1,131 and $52,322, respectively.
                                                                    12
The Gabelli Value Fund Inc.
Notes to Financial Statements (Continued) (Unaudited)

The redemption fee does not apply to shares purchased through programs that the Adviser determined to have
appropriate short-term trading policies in place. Additionally, certain recordkeepers for qualified and non-
qualified retirement plans that could not collect the redemption fee at the participant level due to systems
limitations have received an extension to implement such systems.
Transactions in shares of capital stock were as follows:
                                                                                           Six Months Ended
                                                                                              June 30, 2006                     Year Ended
                                                                                               (Unaudited)                   December 31, 2005
                                                                                        ————————————
                                                                                      ————————————                      ————————————
                                                                                                                       ————————————
                                                                                       Shares            Amount          Shares            Amount
                                                                                       —————
                                                                                      —————            ——————
                                                                                                     ——————            —————
                                                                                                                        —————           —————
                                                                                                                                          —————
                                                                                                                                       —————
                                                                                                 Class A                          Class A
                                                                                       ————————————
                                                                                      ————————————                      ————————————
                                                                                                                       ————————————
Shares sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     1,928,362    $ 37,112,526        3,107,146     $ 59,989,477
Shares issued upon reinvestment of dividends . . . . . . . . .                                 53               976      3,721,831         67,513,966
Shares redeemed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         (17,591,377)     (340,037,251)   (12,826,666)      (247,599,420)
                                                                                       —————
                                                                                      —————            – ————
                                                                                                        —
                                                                                                     — ————            —————
                                                                                                                        —————           —————
                                                                                                                                          —————
                                                                                                                                       —————
    Net decrease . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      (15,662,962) $(302,923,749)       (5,997,689)    $(120,095,977)
                                                                                      —————
                                                                                      — ————
                                                                                         ————
                                                                                       —————
                                                                                       —               –————
                                                                                                     — ————
                                                                                                     — ————
                                                                                                       –—————
                                                                                                        —              ——————
                                                                                                                       —————
                                                                                                                        — ————
                                                                                                                         ————           —————
                                                                                                                                       —————
                                                                                                                                        —————
                                                                                                                                          —————
                                                                                                                                       —————
                                                                                                                                          —————
                                                                                                 Class B                          Class B
                                                                                       ————————————
                                                                                      ————————————                      ————————————
                                                                                                                       ————————————
Shares sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         2,787    $       52,020         20,985     $      381,787
Shares issued upon reinvestment of dividends . . . . . . . .                                     5               90         60,316          1,043,462
Shares redeemed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .            (125,903)       (2,287,617)      (134,928)        (2,513,012)
                                                                                       —————
                                                                                      —————            – ————
                                                                                                        —
                                                                                                     — ————            —————
                                                                                                                        —————           —————
                                                                                                                                          —————
                                                                                                                                       —————
    Net decrease . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         (123,111) $ (2,235,507)           (53,627)    $ (1,087,763)
                                                                                       —————
                                                                                      —————
                                                                                       —————
                                                                                      —————            –
                                                                                                     — ————
                                                                                                        —————
                                                                                                       –————
                                                                                                     — ————
                                                                                                        —              —————
                                                                                                                        —————
                                                                                                                       —————
                                                                                                                        —————             —————
                                                                                                                                        —————
                                                                                                                                       —————
                                                                                                                                       —————
                                                                                                                                        —————
                                                                                                                                          —————
                                                                                                 Class C                          Class C
                                                                                       ————————————
                                                                                      ————————————                      ————————————
                                                                                                                       ————————————
Shares sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        16,007    $      293,365        119,549     $ 2,220,629
Shares issued upon reinvestment of dividends . . . . . . . .                                    —                —          41,465            717,762
Shares redeemed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .            (122,226)       (2,223,264)      (223,193)        (4,137,914)
                                                                                       —————
                                                                                      —————            – ————
                                                                                                        —
                                                                                                     — ————            —————
                                                                                                                        —————           —————
                                                                                                                                          —————
                                                                                                                                       —————
    Net decrease . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         (106,219) $ (1,929,899)           (62,179)    $ (1,199,523)
                                                                                       —————
                                                                                      —————
                                                                                       —————
                                                                                      —————            – ————
                                                                                                     — ————
                                                                                                        —
                                                                                                     — ————
                                                                                                       – ————
                                                                                                        —               —————
                                                                                                                       —————
                                                                                                                       —————
                                                                                                                        —————          —————
                                                                                                                                        —————
                                                                                                                                          —————
                                                                                                                                        —————
                                                                                                                                          —————
                                                                                                                                       —————
8. Indemnifications. The Fund enters into contracts that contain a variety of indemnifications. The Fund’s
maximum exposure under these arrangements is unknown. However, the Fund has not had prior claims or
losses pursuant to these contracts and expects the risk of loss to be remote.
9. Other Matters. The Adviser and/or affiliates have received subpoenas from the Attorney General of the State
of New York and the SEC requesting information on mutual fund trading practices involving certain funds
managed by the Adviser. GAMCO Investors, Inc. (“GAMCO”), the Adviser’s parent company, is responding to
these requests for documents and testimony. In June 2006, GAMCO began discussions with the SEC regarding
a possible resolution of their inquiry. Since these discussions are ongoing, it cannot be determined at this time
whether they will ultimately result in a settlement of this matter. On a separate matter, in September 2005, the
Adviser was informed by the staff of the SEC that the staff may recommend to the Commission that an
administrative remedy and a monetary penalty be sought from the Adviser in connection with the actions of two
of seven closed-end funds managed by the Adviser relating to Section 19(a) and Rule 19a-1 of the 1940 Act.
These provisions require registered investment companies to provide written statements to shareholders when
a dividend is made from a source other than net investment income. While the two closed-end funds sent
annual statements and provided other materials containing this information, the funds did not send written
statements to shareholders with each distribution in 2002 and 2003. The Adviser believes that all of the funds
are now in compliance. The Adviser believes that these matters would have no effect on the Fund or any
material adverse effect on the Adviser or its ability to manage the Fund.
                                                                                          13
The Gabelli Value Fund Inc.
Financial Highlights

Selected data for a share of capital stock outstanding throughout each period:
                                         Income
                               from Investment Operations                  Distributions                                                   Ratios to Average Net Assets/Supplemental Data
                           —————————————
                          ——————————————                            —————————————————————                                              ———————————————————————————————————
                                              Net
              Net Asset       Net        Realized and     Total                    Net                                    Net Asset                  Net Assets        Net
   Period      Value,     Investment      Unrealized      from          Net      Realized                                  Value,                      End of     Investment                Portfolio
   Ended      Beginning     Income/     Gain/(Loss) on Investment   Investment   Gain on         Total       Redemption    End of       Total          Period       Income/     Operating   Turnover
December 31   of Period    (Loss)(a)     Investments Operations       Income   Investments   Distributions     Fees(a)     Period      Return†       (in 000’s)      (Loss)    Expenses (b)   Rate
——————        —————       —————          —————— —————               ————— ——————             ——————          ——————       —————        ————          —————        —————         — –– —
                                                                                                                                                                               — — – — — —————
Class A
  2006(c)     $18.11       $ 0.05         $ 1.44       $ 1.49      —                —            —           $0.00(d)     $19.60        8.2%     $ 843,355         0.57%(e)     1.42%(e)(f) 6%
  2005         19.49         0.02          (0.05)       (0.03) $(0.01)          $(1.34)      $(1.35)          0.00(d)      18.11       (0.2)      1,063,137        0.08         1.40        3
  2004         17.97        (0.02)          2.31         2.29      —             (0.77)       (0.77)          0.00(d)      19.49       12.8       1,261,293       (0.11)        1.39       12
  2003         13.81        (0.05)          4.45         4.40      —             (0.24)       (0.24)            —          17.97       31.9       1,255,668       (0.35)        1.44(g)     8
  2002         16.43        (0.04)         (2.58)       (2.62)     —                —            —              —          13.81      (16.0)      1,024,452       (0.28)        1.40       16
  2001         16.13        (0.05)          0.93         0.88      —             (0.58)       (0.58)            —          16.43        5.4       1,267,975       (0.30)        1.40       29
Class B
  2006(c)     $17.28       $ 0.00         $ 1.35       $ 1.35          —            —             —          $0.00(d)     $18.63        7.8%     $      16,901    (0.04)%(e)    2.17%(e)(f) 6%
  2005         18.79        (0.12)         (0.05)       (0.17)         —        $(1.34)       $(1.34)         0.00(d)      17.28       (0.9)            17,804    (0.67)        2.15        3
  2004         17.47        (0.15)          2.24         2.09          —         (0.77)        (0.77)         0.00(d)      18.79       12.0             20,366    (0.86)        2.14       12
  2003         13.53        (0.17)          4.35         4.18          —         (0.24)        (0.24)           —          17.47       30.9             18,059    (1.10)        2.19(g)     8
  2002         16.23        (0.14)         (2.56)       (2.70)         —            —             —             —          13.53      (16.6)            10,493    (1.01)        2.16       16
  2001         16.07        (0.18)          0.92         0.74          —         (0.58)        (0.58)           —          16.23        4.6              5,505    (1.10)        2.19       29
Class C
  2006(c)     $17.29       $ 0.00         $ 1.35       $ 1.35          —            —             —          $0.00(d)     $18.64        7.8%     $      13,116    (0.04)%(e)    2.17%(e)(f) 6%
  2005         18.80        (0.12)         (0.05)       (0.17)         —        $(1.34)       $(1.34)         0.00(d)      17.29       (0.9)            14,003    (0.67)        2.15        3
  2004         17.49        (0.15)          2.23         2.08          —         (0.77)        (0.77)         0.00(d)      18.80       11.9             16,400    (0.85)        2.14       12
  2003         13.54        (0.17)          4.36         4.19          —         (0.24)        (0.24)           —          17.49       30.9             14,973    (1.10)        2.19(g)     8
  2002         16.24        (0.14)         (2.56)       (2.70)         —            —             —             —          13.54      (16.6)             8,078    (1.01)        2.16       16
  2001         16.07        (0.18)          0.93         0.75          —         (0.58)        (0.58)           —          16.24        4.6              4,170    (1.08)        2.19       29

  † Total return represents aggregate total return of a hypothetical $1,000 investment at the beginning of the period and sold at the end of the period including
     reinvestment of distributions and does not reflect applicable sales charges. Total return for the period of less than one year is not annualized.
(a) Per share amounts have been calculated using the average shares outstanding method.
(b) The ratios do not include a reduction of expenses for custodian fee credits on cash balances maintained with the custodian. Including such custodian fee
     credits, the expense ratios would have been 1.39% (Class A), 2.18% (Class B), and 2.18% (Class C) for 2001. For the fiscal years ended December 31, 2002
     and 2003, and the six months ended June 30, 2006, the effect of the custodian fee credits were minimal. For the fiscal years ended December 31, 2004 and
     2005, there were no custodian fee credits.
(c) For the period ended June 30, 2006, unaudited.
(d) Amount represents less than $0.005 per share.
(e) Annualized.
 (f) The Fund incurred interest expense during the six months ended June 30, 2006. If interest expense had not been incurred, the ratios of operating expenses
     to average net assets would have been 1.41% (Class A), 2.16% (Class B), and 2.16% (Class C), respectively.
(g) The Fund incurred dividend expense on securities sold short for the year ended December 31, 2003. If dividend expense had not been incurred, the ratios of
     operating expenses to average net assets would have been 1.43% (Class A), 2.18% (Class B), and 2.18% (Class C), respectively.
                                                                      See accompanying notes to financial statements.

                                                                                                    14
                                       The Gabelli Value Fund Inc.
         Board Consideration and Re-Approval of Investment Advisory Agreement (Unaudited)
Section 15(c) of the Investment Company Act of 1940, as amended (the “1940 Act”), contemplates that the
Board of Directors (the “Board”) of The Gabelli Value Fund Inc. (the “Fund”), including a majority of the Directors
who have no direct or indirect interest in the investment advisory agreement and are not “interested persons”
of the Fund, as defined in the 1940 Act (the “independent board members”), are required to annually review
and re-approve the terms of the Fund’s existing investment advisory agreement and approve any newly
proposed terms therein. In this regard, the Board reviewed and re-approved, during the most recent six month
period covered by this report, the Investment Advisory Agreement (the “Advisory Agreement”) with Gabelli
Funds, LLC (the “Adviser”) for the Fund.
More specifically, at a meeting held on February 15, 2006, the independent board members, meeting in
executive session with their counsel, reviewed the written and oral information that had been made available,
and considered the factors and reached the conclusions described below relating to the selection of the Adviser
and the re-approval of the Advisory Agreement.
1. Nature, Extent, and Quality of Services. The independent board members considered the nature, quality,
and extent of administrative and shareholder services performed by the Adviser, including portfolio
management, supervision of Fund operations and compliance and regulatory filings and disclosures to
shareholders, general oversight of other service providers, coordination of Fund marketing initiatives, review of
Fund legal issues, assisting the independent board members in their capacity as directors, and other services.
The independent board members concluded that the services are extensive in nature and that the Adviser
consistently delivered a high level of service.
2. Investment Performance of the Fund and Adviser. The independent board members considered short-
term and long-term investment performance for the Fund over various periods of time as compared to both
relevant equity indices and the performance of the Fund’s Lipper, Inc. peer group, and concluded that the
Adviser was delivering superior performance results over the long term consistent with the long-term
investment strategies being pursued by the Fund.

3. Costs of Services and Profits Realized by the Adviser.
(a) Costs of Services to Fund: Fees and Expenses. The independent board members considered the Fund’s
advisory fee rate and expense ratio relative to industry averages for the Fund’s peer group category and the
advisory fees charged by the Adviser and its affiliates to other fund and non-fund clients. The independent
board members noted that the mix of services under the Advisory Agreement are much more extensive than
those under the advisory agreements for non-fund clients. While the independent board members recognized
that the advisory fee paid by the Fund is generally at the high end of its peer group, they concluded that the
fee is acceptable based upon the qualifications, experience, reputation, and performance of the Adviser and
the moderate overall expense ratio of the Fund.
(b) Profitability and Costs of Services to Adviser. The independent board members considered the
Adviser’s overall profitability and costs, and pro-forma estimates of the Adviser’s profitability and costs
attributable to the Fund (i) as part of the Gabelli fund complex and (ii) assuming the Fund constituted the
Adviser’s only investment company under its management. The independent board members also considered
whether the amount of profit is a fair entrepreneurial profit for the management of the Fund, and noted that the
Adviser has substantially increased its resources devoted to Fund matters in response to recently-enacted
                                                        15
regulatory requirements and new or enhanced Fund policies and procedures. The independent board members
concluded that the Adviser’s profitability was at an acceptable level, particularly in light of the high quality of the
services being provided to the Fund.
4. Extent of Economies of Scale as Fund Grows. The independent board members considered whether
there have been economies of scale with respect to the management of the Fund and whether the Fund has
appropriately benefited from any economies of scale. The independent board members noted that economies
of scale may develop for certain funds as their assets increase and their fund-level expenses decline as a
percentage of assets, but that fund-level economies of scale may not necessarily result in Adviser-level
economies of scale. The Adviser had stated during the main meeting that the expenses incurred by the Adviser
relating to management of the Fund have increased substantially in recent years as a percentage of advisory
fees, rather than declining as might be anticipated as the assets of the Fund increase. The independent board
members agreed that it was possible that Adviser-level expenses incurred in managing the Fund eventually
may level off or decline as a percentage of advisory fees, especially if the assets of the Fund continue to grow
beyond certain thresholds.
5. Whether Fee Levels Reflect Economies of Scale. The independent board members also considered
whether the advisory fee rate is reasonable in relation to the asset size of the Fund and any economies of scale
that may exist, and concluded that it currently was reasonable.

6. Other Relevant Considerations.
(a) Adviser Personnel and Methods. The independent board members considered the size, education, and
experience of the Adviser’s staff, the Adviser’s fundamental research capabilities, and the Adviser’s approach
to recruiting, training, and retaining portfolio managers and other research and management personnel, and
concluded that in each of these areas the Adviser was structured in such a way to support the high level of
services being provided to the Fund.
(b) Other Benefits to the Adviser. The independent board members also considered the character and
amount of other incidental benefits received by the Adviser and its affiliates from its association with the Fund.
The independent board members concluded that potential “fall-out” benefits that the Adviser and its affiliates
may receive, such as greater name recognition or increased ability to obtain research services, appear to be
reasonable, and may in some cases benefit the Fund.
Conclusions. In considering the Advisory Agreement, the independent board members did not identify any factor
as all-important or all-controlling and instead considered these factors collectively in light of the Fund’s
surrounding circumstances. Based on this review, it was the judgment of the independent board members that
shareholders had received very favorable absolute and relative performance at reasonable fees and, therefore,
re-approval of the Agreement was in the best interests of the Fund and its shareholders. As a part of its decision
making process, the independent board members noted that the Adviser has managed the Fund since its
inception, and the independent board members believe that a long-term relationship with a capable, conscientious
adviser is in the best interests of the Fund. The independent board members considered, generally, that
shareholders invested in the Fund knowing that the Adviser managed the Fund and knowing its investment
advisory fee schedule. As such, the independent board members considered, in particular, whether the Adviser
managed the Fund in accordance with its investment objectives and policies as disclosed to shareholders. The
independent board members concluded that the Fund was managed by the Adviser consistent with its investment
objectives and policies. Upon conclusion of their review and discussion, the independent board members
unanimously agreed to recommend the continuation of the Advisory Agreement for the Fund.

                                                          16
Gabelli Funds and Your Personal Privacy
Who are we?
The Gabelli/GAMCO Funds are investment companies registered with the Securities and Exchange
Commission under the Investment Company Act of 1940. We are managed by Gabelli Funds, LLC and
Gabelli Advisers, Inc., which are affiliated with GAMCO Investors, Inc. GAMCO Investors, Inc. is a
publicly held company that has subsidiaries that provide investment advisory or brokerage services for
a variety of clients.
What kind of non-public information do we collect about you if you become a Gabelli customer?
If you apply to open an account directly with us, you will be giving us some non-public information about
yourself. The non-public information we collect about you is:
• Information you give us on your application form. This could include your name, address,
     telephone number, social security number, bank account number, and other information.
• Information about your transactions with us, any transactions with our affiliates, and
     transactions with the entities we hire to provide services to you. This would include information
     about the shares that you buy or redeem. If we hire someone else to provide services—like a transfer
     agent—we will also have information about the transactions that you conduct through them.
What information do we disclose and to whom do we disclose it?
We do not disclose any non-public personal information about our customers or former customers to
anyone other than our affiliates, our service providers who need to know such information, and as
otherwise permitted by law. If you want to find out what the law permits, you can read the privacy rules
adopted by the Securities and Exchange Commission. They are in volume 17 of the Code of Federal
Regulations, Part 248. The Commission often posts information about its regulations on its web site,
www.sec.gov.
What do we do to protect your personal information?
We restrict access to non-public personal information about you to the people who need to know that
information in order to provide services to you or the Fund and to ensure that we are complying with the
laws governing the securities business. We maintain physical, electronic, and procedural safeguards to
keep your personal information confidential.
                                     G A B E L L I FA M I LY O F F U N D S
VALUE ________________________________________              AGGRESSIVE GROWTH _________________________               GAMCO Gold Fund
Gabelli Asset Fund                                          GAMCO Global Growth Fund                                  Seeks to invest in a global portfolio of equity
Seeks to invest primarily in a diversified portfolio of     Seeks capital appreciation through a disciplined          securities of gold mining and related companies. The
common stocks selling at significant discounts to           investment program focusing on the globalization and      Fund’s objective is long-term capital appreciation.
their private market value. The Fund’s primary              interactivity of the world’s marketplace. The Fund        Investment in gold stocks is considered speculative
objective is growth of capital. (Multiclass)                invests in companies at the forefront of accelerated      and is affected by a variety of world-wide economic,
              Portfolio Manager: Mario J. Gabelli, CFA      growth. The Fund’s primary objective is capital           financial, and political factors. (Multiclass)
                                                            appreciation. (Multiclass)            Team Managed                              Portfolio Manager: Caesar Bryan
Gabelli Blue Chip Value Fund                                                                                         Gabelli Utilities Fund
Seeks long term growth of capital through investment                                                                 Seeks to provide a high level of total return through a
primarily in the common stocks of established
companies which are temporarily out of favor. The           MICRO-CAP ___________________________________ combination of capital appreciation and current
                                                                                                                     income. (Multiclass)                       Team Managed
fund’s objective is to identify a catalyst or sequence of   Westwood Mighty MitesSM Fund
events that will return the company to a higher value.      Seeks to invest in micro-cap companies that have
(Multiclass)                                                market capitalizations of $300 million or less. The MERGER AND ARBITRAGE _____________________
                                                            Fund’s primary objective is long-term capital Gabelli ABC Fund
               Portfolio Manager: Barbara Marcin, CFA       appreciation. (Multiclass)             Team Managed Seeks to invest in securities with attractive oppor-
Westwood Equity Fund                                                                                                 tunities for appreciation or investment income. The
Seeks to invest primarily in the common stock of well-                                                               Fund’s primary objective is total return in various market
seasoned companies that have recently reported              EQUITY INCOME _______________________________ conditions without excessive risk of capital loss.
positive earnings surprises and are trading below           Gabelli Equity Income Fund                               (No-load)       Portfolio Manager: Mario J. Gabelli, CFA
Westwood’s proprietary growth rate estimates. The           Seeks to invest primarily in equity securities with
Fund’s primary objective is capital appreciation.           above market average yields. The Fund pays monthly CONTRARIAN _________________________________
(Multiclass)       Portfolio Manager: Susan M. Byrne        dividends and seeks a high level of total return with an GAMCO Mathers Fund
                                                            emphasis on income. (Multiclass)                         Seeks long-term capital appreciation in various market
FOCUSED VALUE ______________________________                              Portfolio Manager: Mario J. Gabelli, CFA conditions without excessive risk of capital loss.
Gabelli Value Fund
Seeks to invest in securities of companies believed to                                                               (Class AAA-No-load)
be undervalued. The Fund’s primary objective is long-                                                                            Portfolio Manager: Henry Van der Eb, CFA
                                                            Westwood Balanced Fund
term capital appreciation. (Multiclass)                     Seeks to invest in a balanced and diversified portfolio Comstock Capital Value Fund
              Portfolio Manager: Mario J. Gabelli, CFA      of stocks and bonds. The Fund’s primary objective is Seeks capital appreciation and current income. The
                                                            both capital appreciation and current income.            Fund may use either long or short positions to achieve
SMALL CAP VALUE ____________________________                (Multiclass)                                             its objective. (Multiclass)
Gabelli Small Cap Fund                                                 Co-Portfolio Managers: Susan M. Byrne                          Portfolio Manager: Martin Weiner, CFA
Seeks to invest primarily in common stock of smaller                                           Mark Freeman, CFA Comstock Strategy Fund
companies (market capitalizations less than $1
billion) believed to have rapid revenue and earnings                                                                  The Fund emphasizes investments in debt securities,
growth potential. The Fund’s primary objective is                                                                     which maximize total return in light of credit risk,
capital appreciation. (Multiclass)                       Westwood Income Fund                                         interest rate risk, and the risk associated with the
                                                         Seeks to provide a high level of current income as well      length of maturity of debt instruments. (Multiclass)
               Portfolio Manager: Mario J. Gabelli, CFA
                                                         as long-term capital appreciation by investing in                            Portfolio Manager: Martin Weiner, CFA
                                                         income producing equity and fixed income securities.
Westwood SmallCap Equity Fund                            (Multiclass)                            Team Managed
Seeks to invest primarily in smaller capitalization                                                                   FIXED INCOME ________________________________
equity securities – market caps of $2.5 billion or less.                                                              Westwood Intermediate Bond Fund
The Fund’s primary objective is long-term capital                                                                     Seeks to invest in a diversified portfolio of bonds with
appreciation. (Multiclass)               Team Managed SPECIALTY EQUITY ____________________________                   various maturities. The Fund’s primary objective is
                                                         GAMCO Global Convertible Securities Fund                     total return. (Multiclass)
Gabelli Woodland Small Cap Value Fund                    Seeks to invest principally in bonds and preferred                          Portfolio Manager: Mark Freeman, CFA
Seeks to invest primarily in the common stocks of stocks which are convertible into common stock of
smaller companies (market capitalizations less than foreign and domestic companies. The Fund’s primary
$1.5 billion) believed to be undervalued with objective is total return through a combination of                      CASH MANAGEMENT-MONEY MARKET __________
shareholder oriented management teams that are current income and capital appreciation. (Multiclass)                  Gabelli U.S. Treasury Money Market Fund
                                                                                                  Team Managed        Seeks to invest exclusively in short-term U.S. Treasury
employing strategies to grow the company’s value.
The Fund’s primary objective is capital appreciation.                                                                 securities. The Fund’s primary objective is to provide
(Multiclass)                                                                                                          high current income consistent with the preservation
                                                                                                                      of principal and liquidity. (No-load)
              Portfolio Manager: Elizabeth M. Lilly, CFA GAMCO Global Opportunity Fund
                                                         Seeks to invest in common stock of companies which                              Portfolio Manager: Judith A. Raneri
GROWTH ______________________________________ have rapid growth in revenues and earnings and
                                                         potential for above average capital appreciation or are
GAMCO Growth Fund
                                                         undervalued. The Fund’s primary objective is capital
                                                                                                                      An investment in the above Money Market Fund is
Seeks to invest primarily in large cap stocks believed appreciation. (Multiclass)                Team Managed         neither insured nor guaranteed by the Federal Deposit
to have favorable, yet undervalued, prospects for                                                                     Insurance Corporation or any government agency.
earnings growth. The Fund’s primary objective is                                                                      Although the Fund seeks to preserve the value of your
capital appreciation. (Multiclass)
                Portfolio Manager: Howard F. Ward, CFA SECTOR ______________________________________                  investment at $1.00 per share, it is possible to lose
                                                                                                                      money by investing in the Fund.
                                                         GAMCO Global Telecommunications Fund
GAMCO International Growth Fund                          Seeks to invest in telecommunications companies              The Funds may invest in foreign securities which involve
Seeks to invest in the equity securities of foreign throughout the world – targeting undervalued
                                                                                                                      risks not ordinarily associated with investments in
issuers with long-term capital appreciation potential. companies with strong earnings and cash flow
The Fund offers investors global diversification. dynamics. The Fund’s primary objective is capital                   domestic issues, including currency fluctuation,
(Multiclass)           Portfolio Manager: Caesar Bryan appreciation. (Multiclass)                Team Managed         economic, and political risks.

  To receive a prospectus, call 800-GABELLI (422-3554). Investors should carefully consider the investment objectives, risks, charges, and expenses of the Fund
              before investing. The prospectus contains more information about this and other matters and should be read carefully before investing.
             The Gabelli Value Fund Inc.
                     One Corporate Center
                   Rye, New York 10580-1422
                         800-GABELLI                                                E
                                                                                    P
                                                                                            P
                                                                                            M
                                                                                    S       V
                         800-422-3554
                       fax: 914-921-5118
                website: www.gabelli.com                                            MANAGEMENT

                e-mail: info@gabelli.com                                            CASH FLOW
          Net Asset Value available daily by calling
               800-GABELLI after 6:00 P.M.                                        RE S E A R C H


                       Board of Directors
Mario J. Gabelli, CFA                   Anthony R. Pustorino
Chairman and Chief                      Certified Public Accountant,
Executive Officer                       Professor Emeritus
GAMCO Investors, Inc.                   Pace University

Anthony J. Colavita                     Werner J. Roeder, MD
Attorney-at-Law                         Medical Director
Anthony J. Colavita, P.C.               Lawrence Hospital
                                                                       The
Robert J. Morrissey
Attorney-at-Law
Morrissey, Hawkins & Lynch                                             Gabelli
                             Officers
Bruce N. Alpert
President
                                        James E. McKee
                                        Secretary                      Value
Agnes Mullady                           Peter D. Goldstein
Treasurer

                            Custodian
                                        Chief Compliance Officer
                                                                       Fund
                  Mellon Trust of New England, N.A.

     Transfer Agent and Dividend Disbursing Agent
             State Street Bank and Trust Company
                                                                       Inc.
                          Legal Counsel
                    Willkie Farr & Gallagher LLP

                           Distributor
                      Gabelli & Company, Inc.

This report is submitted for the general information of the
shareholders of The Gabelli Value Fund Inc. It is not authorized for
distribution to prospective investors unless preceded or accompanied
                                                                         SEMI-ANNUAL REPORT
by an effective prospectus.
                                                                                JUNE 30, 2006
GAB409Q206SR

				
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