SIGNATURES

FORM N-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED

MANAGEMENT INVESTMENT COMPANY

Investment Company Act file number 811-8709

Western Asset High Income Fund II Inc.

(Exact name of registrant as specified in charter)

125 Broad Street, New York, NY 10004

(Address of principal executive offices) (Zip code)

Robert I. Frenkel, Esq.

Legg Mason & Co., LLC

300 First Stamford Place, 4^th Floor

Stamford, CT 06902

(Name and address of agent for service)

Registrant’s telephone number, including area code: 1-800-451-2010

Date of fiscal year end: April 30

Date of reporting period: January 31, 2007

WESTERN ASSET HIGH INCOME FUND II INC.

January 31, 2007

ITEM 1. SCHEDULE OF INVESTMENTS

Western Asset High Income Fund II Inc.

Schedule of Investments (unaudited)

January 31, 2007

Face Amount†		Security	Value
CORPORATE BONDS & NOTES — 84.2%
Aerospace & Defense — 1.4%
$	1,555,000	Alliant Techsystems Inc., Senior Subordinated Notes, 6.750% due 4/1/16	$	1,555,000
4,200,000		Argo-Tech Corp., Senior Notes, 9.250% due 6/1/11	4,567,500
		DRS Technologies Inc., Senior Subordinated Notes:
1,535,000		6.625% due 2/1/16	1,527,325
3,350,000		7.625% due 2/1/18	3,425,375
106,119		Kac Acquisition Co., Subordinated Notes, 1.000% due 4/26/26 (a)(b)	0
5,500,000		L-3 Communications Corp., Senior Subordinated Notes, 7.625% due 6/15/12	5,699,375
		Total Aerospace & Defense	16,774,575
Airlines — 1.0%
		Continental Airlines Inc.:
770,000		Notes, 8.750% due 12/1/11	775,775
		Pass-Through Certificates:
373,027		Series 1998-1, Class C, 6.541% due 9/15/08	371,395
1,299,217		Series 2000-2, Class C, 8.312% due 10/2/12	1,313,021
		Delta Air Lines Inc., Pass-Through Certificates, Series 01-1:
1,395,954		6.619% due 3/18/11 (c)	1,396,827
6,135,000		7.111% due 9/18/11 (c)	6,200,185
2,135,000		7.711% due 9/18/11 (c)	2,117,653
		Total Airlines	12,174,856
Auto Components — 1.1%
3,335,000		Keystone Automotive Operations Inc., Senior Subordinated Notes, 9.750% due 11/1/13	3,309,988
		TRW Automotive Inc.:
1,439,000		Senior Notes, 9.375% due 2/15/13	1,546,925
150,000		Senior Subordinated Notes, 11.000% due 2/15/13	165,000
		Visteon Corp., Senior Notes:
4,535,000		8.250% due 8/1/10	4,557,675
3,670,000		7.000% due 3/10/14	3,247,950
		Total Auto Components	12,827,538
Automobiles — 2.3%
		Ford Motor Co.:
		Debentures:
1,880,000		8.875% due 1/15/22	1,706,100
1,150,000		8.900% due 1/15/32	1,035,000
20,255,000		Notes, 7.450% due 7/16/31	16,533,144
		General Motors Corp.:
5,320,000		Notes, 7.200% due 1/15/11 (d)	5,200,300
2,375,000		Senior Debentures, 8.250% due 7/15/23 (d)	2,262,187
		Total Automobiles	26,736,731
Building Products — 1.5%
6,960,000		Associated Materials Inc., Senior Discount Notes, step bond to yield 12.785% due 3/1/14	5,133,000
2,130,000		Jacuzzi Brands Inc., Senior Secured Notes, 9.625% due 7/1/10	2,273,775
1,750,000		Nortek Inc., Senior Subordinated Notes, 8.500% due 9/1/14	1,745,625
11,025,000		NTK Holdings Inc., Senior Discount Notes, step bond to yield 11.457% due 3/1/14 (d)	8,158,500
		Total Building Products	17,310,900
Capital Markets — 0.6%
3,304,000		BCP Crystal U.S. Holdings Corp., Senior Subordinated Notes, 9.625% due 6/15/14	3,667,440

See Notes to Schedule of Investments.

Western Asset High Income Fund II Inc.

Schedule of Investments (unaudited) (continued)

January 31, 2007

Face Amount†		Security	Value
Capital Markets — 0.6% (continued)
$	3,000,000	E*TRADE Financial Corp., Senior Notes, 7.375% due 9/15/13	$	3,127,500
		Total Capital Markets	6,794,940
Chemicals — 2.7%
2,800,000		Borden Chemicals & Plastics LP, Notes, 9.500% due 9/18/11 (a)(b)(c)	42,000
715,000		Chemtura Corp., Senior Notes, 6.875% due 6/1/16	697,125
3,500,000		Equistar Chemicals LP, Senior Notes, 10.625% due 5/1/11	3,727,500
5,260,000		Georgia Gulf Corp., Senior Notes, 9.500% due 10/15/14 (e)	5,233,700
2,390,000		Huntsman International LLC, Senior Subordinated Notes, 7.875% due 11/13/14 (e)	2,473,650
		Lyondell Chemical Co.:
		Senior Notes:
1,400,000		8.000% due 9/15/14	1,463,000
1,155,000		8.250% due 9/15/16	1,230,075
		Senior Secured Notes:
1,300,000		11.125% due 7/15/12	1,405,625
100,000		10.500% due 6/1/13	110,875
3,075,000		Methanex Corp., Senior Notes, 8.750% due 8/15/12	3,367,125
3,550,000		Millennium America Inc., Senior Notes, 9.250% due 6/15/08	3,709,750
4,475,000		Montell Finance Co. BV, Debentures, 8.100% due 3/15/27 (e)	4,340,750
2,251,000		Rhodia SA, Senior Notes, 10.250% due 6/1/10	2,577,395
1,255,000		Westlake Chemical Corp., Senior Notes, 6.625% due 1/15/16	1,236,175
		Total Chemicals	31,614,745
Commercial Banks — 0.6%
440,000		Banco Mercantil del Norte SA, Subordinated Bonds, 6.135% due 10/13/16 (e)(f)	442,453
1,154,000		ICICI Bank Ltd., Bonds, 6.375% due 4/30/22 (e)(f)	1,148,411
2,650,000		Russian Agricultural Bank, Notes, 7.175% due 5/16/13 (e)	2,765,275
2,785,000		TuranAlem Finance BV, 8.250% due 1/22/37 (e)	2,826,775
		Total Commercial Banks	7,182,914
Commercial Services & Supplies — 2.6%
630,000		Aleris International Inc., Senior Subordinated Notes, 10.000% due 12/15/16 (e)	655,200
2,100,000		Allied Security Escrow Corp., Senior Subordinated Notes, 11.375% due 7/15/11	2,163,000
		Allied Waste North America Inc., Senior Notes, Series B:
250,000		8.500% due 12/1/08	261,875
757,000		9.250% due 9/1/12	805,259
5,885,000		7.375% due 4/15/14	5,899,712
1,050,000		7.250% due 3/15/15	1,056,563
		Aramark Corp., Senior Notes:
2,690,000		8.500% due 2/1/15 (e)	2,767,337
650,000		8.860% due 2/1/15 (e)(f)	666,250
3,200,000		Brand Services Inc., Senior Notes, 12.000% due 10/15/12 (d)	3,522,080
4,495,000		DynCorp International LLC/DIV Capital Corporation, Senior Subordinated Notes, Series B, 9.500% due 2/15/13	4,742,225
		Interface Inc.:
2,875,000		Senior Notes, 10.375% due 2/1/10	3,191,250
1,500,000		Senior Subordinated Notes, 9.500% due 2/1/14	1,605,000
3,000,000		Rental Services Corp., Senior Bonds, 9.500% due 12/1/14 (e)	3,150,000
		Total Commercial Services & Supplies	30,485,751
Communications Equipment — 0.5%
6,100,000		Lucent Technologies Inc., Debentures, 6.450% due 3/15/29	5,581,500

See Notes to Schedule of Investments.

Western Asset High Income Fund II Inc.

Schedule of Investments (unaudited) (continued)

January 31, 2007

Face Amount†		Security	Value
Consumer Finance — 3.7%
		Ford Motor Credit Co.:
		Notes:
$	3,075,000	7.875% due 6/15/10	$	3,122,426
3,320,000		7.000% due 10/1/13	3,171,244
		Senior Notes:
4,248,000		10.610% due 6/15/11 (e)(f)	4,623,417
1,950,000		9.875% due 8/10/11	2,089,745
1,210,000		8.110% due 1/13/12 (f)	1,216,447
2,490,000		8.000% due 12/15/16	2,448,952
		General Motors Acceptance Corp.:
17,300,000		Bonds, 8.000% due 11/1/31 (d)	19,528,897
6,890,000		Notes, 6.875% due 8/28/12 (d)	7,010,258
		Total Consumer Finance	43,211,386
Containers & Packaging — 2.0%
4,960,000		Graham Packaging Co. Inc., Senior Subordinated Notes, 9.875% due 10/15/14	5,133,600
4,470,000		Graphic Packaging International Corp., Senior Subordinated Notes, 9.500% due 8/15/13	4,760,550
3,750,000		JSG Funding PLC, Senior Notes, 9.625% due 10/1/12	4,003,125
		Owens-Brockway Glass Container Inc., Senior Secured Notes:
1,050,000		8.875% due 2/15/09	1,078,875
4,349,000		8.750% due 11/15/12	4,620,813
1,490,000		Plastipak Holdings Inc., Senior Notes, 8.500% due 12/15/15 (e)	1,564,500
1,975,000		Radnor Holdings Corp., Senior Notes, 11.000% due 3/15/10 (c)	17,281
2,355,000		Smurfit-Stone Container Enterprises Inc., Senior Notes, 8.375% due 7/1/12	2,378,550
		Total Containers & Packaging	23,557,294
Diversified Consumer Services — 0.4%
		Education Management LLC/Education Management Corp.:
1,965,000		8.750% due 6/1/14	2,073,075
290,000		10.250% due 6/1/16	313,200
		Service Corp. International:
650,000		Debentures, 7.875% due 2/1/13	672,750
1,200,000		Senior Notes, 7.625% due 10/1/18	1,266,000
		Total Diversified Consumer Services	4,325,025
Diversified Financial Services — 2.3%
4,060,000		Basell AF SCA, Senior Secured Subordinated Second Priority Notes, 8.375% due 8/15/15 (e)	4,212,250
2,110,000		CCM Merger Inc., Notes, 8.000% due 8/1/13 (e)	2,107,362
		CitiSteel USA Inc., Senior Secured Notes:
1,255,000		12.949% due 9/1/10 (f)	1,302,063
870,000		15.000% due 10/1/10 (e)(g)	1,030,950
135,000		El Paso Performance-Linked Trust Certificates, Notes, 7.750% due 7/15/11 (e)	141,075
3,025,000		Idearc Inc., Senior Notes, 8.000% due 11/15/16 (e)	3,089,281
2,055,000		Milacron Escrow Corp., Senior Secured Notes, 11.500% due 5/15/11	1,972,800
1,360,000		TNK-BP Finance SA, 7.500% due 7/18/16 (e)	1,423,512
1,460,000		UCAR Finance Inc., Senior Notes, 10.250% due 2/15/12	1,540,300
2,055,000		UGS Corp., Senior Subordinated Notes, 10.000% due 6/1/12	2,260,500
4,130,000		Vanguard Health Holdings Co. I LLC, Senior Discount Notes, step bond to yield 9.967% due 10/1/15	3,334,975
4,425,000		Vanguard Health Holdings Co. II LLC, Senior Subordinated Notes, 9.000% due 10/1/14	4,552,219
		Total Diversified Financial Services	26,967,287

See Notes to Schedule of Investments.

Western Asset High Income Fund II Inc.

Schedule of Investments (unaudited) (continued)

January 31, 2007

Face Amount†		Security		Value
Diversified Telecommunication Services — 6.7%
$	3,770,000	Axtel SA de CV, Senior Notes, 7.625% due 2/1/17 (e)		$	3,787,304
		Cincinnati Bell Inc.:
3,240,000		Senior Notes, 7.000% due 2/15/15		3,256,200
1,040,000		Senior Subordinated Notes, 8.375% due 1/15/14		1,071,200
1,260,000		Cincinnati Bell Telephone Co., Senior Debentures, 6.300% due 12/1/28		1,146,600
		Citizens Communications Co., Senior Notes:
1,585,000		7.875% due 1/15/27 (e)		1,612,738
2,055,000		9.000% due 8/15/31		2,224,537
		Hawaiian Telcom Communications Inc.:
175,000		Senior Notes, Series B, 10.889% due 5/1/13 (f)		180,688
6,121,000		Senior Subordinated Notes, Series B, 12.500% due 5/1/15		6,687,192
2,725,000		Inmarsat Finance PLC, 7.625% due 6/30/12		2,827,187
		Intelsat Bermuda Ltd., Senior Notes:
1,485,000		8.872% due 1/15/15 (e)(f)		1,518,413
4,315,000		9.250% due 6/15/16 (e)		4,757,287
6,440,000		11.250% due 6/15/16 (e)		7,309,400
490,000		Intelsat Ltd., Notes, 7.625% due 4/15/12		474,688
1,915,000		Level 3 Communications Inc., Senior Notes, 11.500% due 3/1/10		2,072,987
		Level 3 Financing Inc., Senior Notes:
1,275,000		11.800% due 3/15/11 (f)		1,357,875
1,320,000		9.250% due 11/1/14 (e)		1,356,300
2,820,000		Nordic Telephone Co. Holdings, Senior Secured Notes, 8.875% due 5/1/16 (e)		3,045,600
		NTL Cable PLC, Senior Notes:
140,000		8.750% due 4/15/14 (d)		145,950
4,220,000		9.125% due 8/15/16 (d)		4,483,750
1,355,000		PanAmSat Corp., Senior Notes, 9.000% due 8/15/14		1,466,788
		Qwest Communications International Inc., Senior Notes:
365,000		7.500% due 2/15/14		378,688
900,000		Series B, 7.500% due 2/15/14		933,750
		Qwest Corp.:
3,878,000		Debentures, 6.875% due 9/15/33		3,703,490
7,325,000		Notes, 8.875% due 3/15/12		8,167,375
3,640,000		Southwestern Bell Telephone Co., Debentures, 7.000% due 11/15/27		3,706,776
4,770,000		Telcordia Technologies Inc., Senior Subordinated Notes, 10.000% due 3/15/13 (e)		4,507,650
6,000,000		^MXN	Telefonos de Mexico SA de CV, Senior Notes, 8.750% due 1/31/16	542,018
610,000		Wind Acquisition Finance SA, Senior Bond, 10.750% due 12/1/15 (e)		706,075
5,110,000		Windstream Corp., 8.625% due 8/1/16		5,601,837
		Total Diversified Telecommunication Services		79,030,343
Electric Utilities — 0.7%
		Enersis SA:
1,295,000		Bonds, 7.375% due 1/15/14		1,391,514
487,000		Notes, 7.400% due 12/1/16		535,321
1,665,000		IPALCO Enterprises Inc., Secured Notes, 8.625% due 11/14/11		1,810,687
1,106,110		Midwest Generation LLC, Pass-Through Certificates, Series B, 8.560% due 1/2/16		1,217,413
2,570,000		Orion Power Holdings Inc., Senior Notes, 12.000% due 5/1/10		2,961,925
		Total Electric Utilities		7,916,860
Electronic Equipment & Instruments — 0.3%
		NXP BV/NXP Funding LLC:
795,000		Senior Notes, 9.500% due 10/15/15 (e)		825,806
2,420,000		Senior Secured Bond, 7.875% due 10/15/14 (e)		2,510,750
		Total Electronic Equipment & Instruments		3,336,556

See Notes to Schedule of Investments.

Western Asset High Income Fund II Inc.

Schedule of Investments (unaudited) (continued)

January 31, 2007

Face
Amount†		Security	Value
Energy Equipment & Services — 0.9%
$	3,115,000	Complete Production Services Inc., Senior Notes, 8.000% due 12/15/16 (e)	$	3,169,513
1,605,000		Geokinetics Inc., Secured Notes, 11.860% due 12/15/12 (d)(e)(f)	1,621,050
650,000		GulfMark Offshore Inc., Senior Subordinated Notes, 7.750% due 7/15/14	659,750
3,175,000		Hanover Compressor Co., Senior Notes, 9.000% due 6/1/14	3,397,250
1,210,000		Pride International Inc., Senior Notes, 7.375% due 7/15/14	1,234,200
400,000		Southern Natural Gas Co., Senior Notes, 8.000% due 3/1/32	464,978
		Total Energy Equipment & Services	10,546,741
Food Products — 0.4%
		Dole Food Co. Inc.:
1,600,000		Debentures, 8.750% due 7/15/13	1,584,000
		Senior Notes:
2,065,000		7.250% due 6/15/10	2,005,631
1,050,000		8.875% due 3/15/11	1,050,000
		Total Food Products	4,639,631
Gas Utilities — 0.5%
5,625,000		Suburban Propane Partners LP/Suburban Energy Finance Corp., Senior Notes, 6.875% due 12/15/13	5,498,438
Health Care Providers & Services — 4.0%
4,425,000		AmeriPath Inc., Senior Subordinated Notes, 10.500% due 4/1/13	4,823,250
4,885,000		DaVita Inc., Senior Subordinated Notes, 7.250% due 3/15/15	4,970,487
		HCA Inc.:
3,880,000		Debentures, 7.500% due 11/15/95	2,979,351
2,100,000		Notes, 6.375% due 1/15/15	1,790,250
7,210,000		Senior Notes, 6.500% due 2/15/16	6,110,475
		Senior Secured Notes:
3,065,000		9.250% due 11/15/16 (e)	3,264,225
2,510,000		9.625% due 11/15/16 (e)	2,701,388
4,800,000		IASIS Healthcare LLC/IASIS Capital Corp., Senior Subordinated Notes, 8.750% due 6/15/14	4,926,000
		Tenet Healthcare Corp., Senior Notes:
6,000,000		7.375% due 2/1/13	5,580,000
4,560,000		9.875% due 7/1/14	4,645,500
1,500,000		6.875% due 11/15/31	1,181,250
4,550,000		Triad Hospitals Inc., Senior Subordinated Notes, 7.000% due 11/15/13	4,675,125
		Total Health Care Providers & Services	47,647,301
Hotels, Restaurants & Leisure — 6.3%
		Boyd Gaming Corp., Senior Subordinated Notes:
600,000		7.750% due 12/15/12	620,250
1,000,000		6.750% due 4/15/14	985,000
2,535,000		Buffets Inc., 12.500% due 11/1/14 (d)	2,630,062
		Caesars Entertainment Inc., Senior Subordinated Notes:
700,000		9.375% due 2/15/07	700,875
4,500,000		8.875% due 9/15/08	4,719,375
3,000,000		8.125% due 5/15/11	3,191,250
2,725,000		Carrols Corp., Senior Subordinated Notes, 9.000% due 1/15/13	2,820,375
1,150,000		Choctaw Resort Development Enterprise, Senior Notes, 7.250% due 11/15/19 (e)	1,173,000
4,725,000		Denny’s Holdings Inc., Senior Notes, 10.000% due 10/1/12	5,049,844
1,475,000		El Pollo Loco Inc., Senior Notes, 11.750% due 11/15/13	1,607,750
4,150,000		Herbst Gaming Inc., Senior Subordinated Notes, 7.000% due 11/15/14	4,015,125
4,070,000		Inn of the Mountain Gods Resort & Casino, Senior Notes, 12.000% due 11/15/10	4,456,650

See Notes to Schedule of Investments.

Western Asset High Income Fund II Inc.

Schedule of Investments (unaudited) (continued)

January 31, 2007

Face
Amount†		Security	Value
Hotels, Restaurants & Leisure — 6.3% (continued)
$	4,800,000	Isle of Capri Casinos Inc., Senior Subordinated Notes, 7.000% due 3/1/14	$	4,764,000
3,850,000		Las Vegas Sands Corp., Senior Notes, 6.375% due 2/15/15	3,763,375
		MGM MIRAGE Inc.:
		Senior Notes:
355,000		8.500% due 9/15/10	382,513
955,000		6.750% due 9/1/12	952,612
3,485,000		7.625% due 1/15/17	3,524,206
		Senior Subordinated Notes:
2,760,000		9.750% due 6/1/07	2,804,850
455,000		8.375% due 2/1/11	480,594
		Mohegan Tribal Gaming Authority, Senior Subordinated Notes:
1,100,000		7.125% due 8/15/14	1,130,250
2,475,000		6.875% due 2/15/15	2,490,469
620,000		Penn National Gaming Inc., Senior Subordinated Notes, 6.750% due 3/1/15	600,625
4,700,000		Pinnacle Entertainment Inc., Senior Subordinated Notes, 8.250% due 3/15/12	4,835,125
3,930,000		Pokagon Gaming Authority, Senior Notes, 10.375% due 6/15/14 (e)	4,332,825
415,000		River Rock Entertainment Authority, Senior Notes, 9.750% due 11/1/11	445,088
		Sbarro Inc., Senior Notes:
2,825,000		11.000% due 9/15/09	2,890,907
465,000		10.375% due 2/1/15 (e)	476,625
		Snoqualmie Entertainment Authority:
840,000		Notes, 9.125% due 2/1/15 (e)	854,700
885,000		Senior Notes, 9.150% due 2/1/14 (e)(f)	894,956
		Station Casinos Inc.:
		Senior Notes:
40,000		6.000% due 4/1/12	38,050
3,885,000		7.750% due 8/15/16	3,982,125
		Senior Subordinated Notes:
80,000		6.875% due 3/1/16	73,600
1,355,000		6.625% due 3/15/18	1,189,012
1,000,000		Wynn Las Vegas LLC/Wynn Las Vegas Capital Corp., 6.625% due 12/1/14	995,000
		Total Hotels, Restaurants & Leisure	73,871,063
Household Durables — 1.9%
310,000		American Greetings Corp., Senior Notes, 7.375% due 6/1/16	320,075
		Beazer Homes USA Inc., Senior Notes:
295,000		6.875% due 7/15/15	285,413
1,920,000		8.125% due 6/15/16	2,006,400
4,000,000		Holt Group Inc., Senior Notes, 9.750% due 1/15/06 (a)(b)(c)*	0
		K Hovnanian Enterprises Inc., Senior Notes:
2,605,000		7.500% due 5/15/16	2,618,025
4,480,000		8.625% due 1/15/17	4,748,800
2,590,000		Norcraft Cos. LP/Norcraft Finance Corp., Senior Subordinated Notes, 9.000% due 11/1/11	2,687,125
5,765,000		Norcraft Holdings LP/Norcraft Capital Corp., Senior Discount Notes, step bond to yield 9.952% due 9/1/12	5,102,025
4,150,000		Sealy Mattress Co., Senior Subordinated Notes, 8.250% due 6/15/14	4,378,250
		Total Household Durables	22,146,113
Household Products — 0.3%
		Nutro Products Inc.:
435,000		Senior Notes, 9.400% due 10/15/13 (e)(f)	451,313
1,530,000		Senior Subordinated Notes, 10.750% due 4/15/14 (e)	1,683,000
1,890,000		Visant Holding Corp., Senior Notes, 8.750% due 12/1/13	1,993,950
		Total Household Products	4,128,263

See Notes to Schedule of Investments.

Western Asset High Income Fund II Inc.

Schedule of Investments (unaudited) (continued)

January 31, 2007

Face
Amount†		Security	Value
Independent Power Producers & Energy Traders — 4.0%
$	2,710,000	AES China Generating Co., Ltd., Class A, 8.250% due 6/26/10	$	2,711,469
		AES Corp.:
		Senior Notes:
1,325,000		9.500% due 6/1/09	1,411,125
1,900,000		9.375% due 9/15/10	2,061,500
250,000		8.875% due 2/15/11	268,750
4,225,000		7.750% due 3/1/14	4,467,937
730,000		Senior Secured Notes, 9.000% due 5/15/15 (e)	784,750
2,500,000		Calpine Generating Co. LLC, Senior Secured Notes, 14.370% due 4/1/11 (c)(f)	2,662,500
8,350,000		Dynegy Holdings Inc., Senior Debentures, 7.625% due 10/15/26 (d)	8,141,250
		Edison Mission Energy, Senior Notes:
4,575,000		7.730% due 6/15/09	4,735,125
445,000		7.500% due 6/15/13	463,913
2,600,000		7.750% due 6/15/16	2,762,500
4,235,000		Mirant North America LLC, Senior Notes, 7.375% due 12/31/13	4,340,875
		NRG Energy Inc., Senior Notes:
1,675,000		7.250% due 2/1/14 (d)	1,683,375
8,770,000		7.375% due 2/1/16 (d)	8,802,887
1,800,000		7.375% due 1/15/17 (d)	1,804,500
		Total Independent Power Producers & Energy Traders	47,102,456
Industrial Conglomerates — 0.1%
680,000		Koppers Inc., Senior Notes, 9.875% due 10/15/13	741,200
2,750,000		Moll Industries Inc., Senior Subordinated Notes, 10.500% due 7/1/08 (a)(b)(c)*	0
940,000		Sequa Corp., Senior Notes, 9.000% due 8/1/09	1,001,100
		Total Industrial Conglomerates	1,742,300
Insurance — 0.5%
6,005,000		Crum & Forster Holdings Corp., Senior Notes, 10.375% due 6/15/13	6,515,425
Internet & Catalog Retail — 0.3%
1,160,000		Brookstone Co. Inc., Senior Secured Notes, 12.000% due 10/15/12 (d)	1,180,300
2,218,000		FTD Inc., Senior Subordinated Notes, 7.750% due 2/15/14	2,234,635
		Total Internet & Catalog Retail	3,414,935
IT Services — 0.6%
		SunGard Data Systems Inc.:
2,900,000		Senior Notes, 9.125% due 8/15/13	3,066,750
3,230,000		Senior Subordinated Notes, 10.250% due 8/15/15	3,488,400
		Total IT Services	6,555,150
Leisure Equipment & Products — 0.2%
2,810,000		WMG Acquisition Corp., Senior Subordinated Notes, 7.375% due 4/15/14	2,781,900
Machinery — 0.6%
1,850,000		Case New Holland Inc., Senior Notes, 7.125% due 3/1/14	1,905,500
641,000		Mueller Group Inc., Senior Subordinated Notes, 10.000% due 5/1/12 (d)	695,485
4,814,000		Mueller Holdings Inc., Senior Discount Notes, step bond to yield 14.392% due 4/15/14 (d)	4,404,810
		Total Machinery	7,005,795
Media — 10.3%
		Affinion Group Inc.:
4,465,000		Senior Notes, 10.125% due 10/15/13	4,822,200
2,025,000		Senior Subordinated Notes, 11.500% due 10/15/15	2,187,000
		AMC Entertainment Inc.:

See Notes to Schedule of Investments.

Western Asset High Income Fund II Inc.

Schedule of Investments (unaudited) (continued)

January 31, 2007

Face
Amount†		Security	Value
Media — 10.3% (continued)
$	20,000	Senior Notes, Series B, 8.625% due 8/15/12	$	21,125
6,905,000		Senior Subordinated Notes, 11.000% due 2/1/16	7,837,175
		CCH I Holdings LLC, Senior Notes:
2,100,000		13.500% due 1/15/14 (d)	2,089,500
156,000		11.000% due 10/1/15	161,460
3,000,000		CCH I Holdings LLC/CCH I Holdings Capital Corp., Senior Accreting Notes, Step bond to yield 17.441% due 1/15/15 (d)	2,887,500
5,040,000		CCH I LLC/CCH Capital Corp., Senior Secured Notes, 11.000% due 10/1/15 (d)	5,229,000
		CCH II LLC/CCH II Capital Corp., Senior Notes:
4,390,000		10.250% due 9/15/10 (d)	4,582,062
3,032,000		10.250% due 10/1/13 (d)	3,259,400
1,395,000		Charter Communications Holdings LLC, Senior Discount Notes, 12.125% due 1/15/12	1,346,175
		Charter Communications Holdings LLC/Charter Communications Holdings Capital Corp., Senior Discount Notes:
325,000		9.920% due 4/1/11	310,375
1,325,000		11.750% due 5/15/11	1,291,875
925,000		Charter Communications Operating LLC, Second Lien Senior Notes, 8.375% due 4/30/14 (e)	966,625
1,375,000		Chukchansi Economic Development Authority, Senior Notes, 8.000% due 11/15/13 (e)	1,430,000
3,270,000		CMP Susquehanna Corp., Senior Subordinated Notes, 9.875% due 5/15/14 (e)	3,368,100
		CSC Holdings Inc.:
4,210,000		Senior Debentures, Series B, 8.125% due 8/15/09 (d)	4,383,663
		Senior Notes, Series B:
280,000		8.125% due 7/15/09	291,550
3,400,000		7.625% due 4/1/11	3,519,000
813,000		Dex Media East LLC/Dex Media East Finance Co., Senior Notes, Series B, 12.125% due 11/15/12	896,333
3,350,000		Dex Media Inc., Discount Notes, step bond to yield 8.367% due 11/15/13	3,056,875
2,344,000		Dex Media West LLC/Dex Media Finance Co., Senior Subordinated Notes, Series B, 9.875% due 8/15/13	2,560,820
4,441,000		DIRECTV Holdings LLC/DIRECTV Financing Co. Inc., Senior Notes, 8.375% due 3/15/13	4,668,601
		EchoStar DBS Corp., Senior Notes:
4,410,000		7.000% due 10/1/13	4,437,562
8,010,000		7.125% due 2/1/16	8,080,087
1,950,000		Interep National Radio Sales Inc., Senior Subordinated Notes, Series B, 10.000% due 7/1/08	1,677,000
930,000		ION Media Networks Inc., Senior Secured Notes, 11.610% due 1/15/13 (e)(f)	971,850
4,200,000		Kabel Deutschland GmbH, Senior Notes, 10.625% due 7/1/14	4,709,250
2,760,000		Lamar Media Corp., Senior Subordinated Notes, 6.625% due 8/15/15	2,732,400
3,520,000		LodgeNet Entertainment Corp., Senior Subordinated Notes, 9.500% due 6/15/13	3,792,800
2,615,000		Primedia Inc., Senior Notes, 8.875% due 5/15/11	2,680,375
1,255,000		Quebecor Media Inc., Senior Notes, 7.750% due 3/15/16	1,280,100
		R.H. Donnelley Corp.:
		Senior Discount Notes:
1,000,000		Series A-1, 6.875% due 1/15/13	962,500
2,200,000		Series A-2, 6.875% due 1/15/13	2,117,500
5,200,000		Senior Notes, Series A-3, 8.875% due 1/15/16	5,473,000
900,000		R.H. Donnelley Finance Corp. I, Senior Subordinated Notes, 10.875% due 12/15/12 (e)	983,250
3,475,000		Radio One Inc., Senior Subordinated Notes, Series B, 8.875% due 7/1/11	3,622,688
4,885,000		Rainbow National Services LLC, Senior Notes, 8.750% due 9/1/12 (e)	5,226,950
		Rogers Cable Inc.:

See Notes to Schedule of Investments.

Western Asset High Income Fund II Inc.

Schedule of Investments (unaudited) (continued)

January 31, 2007

Face Amount†		Security			Value
Media — 10.3% (continued)
$	1,455,000	Secured Notes, 5.500% due 3/15/14			$	1,398,675
		Senior Secured Second Priority Notes:
1,340,000		6.250% due 6/15/13			1,348,375
760,000		6.750% due 3/15/15			784,175
4,117,000		Sinclair Broadcast Group Inc., Senior Subordinated Notes, 8.000% due 3/15/12			4,250,803
750,000		Videotron Ltee., Senior Notes, 6.375% due 12/15/15			731,250
		XM Satellite Radio Inc., Senior Notes:
860,000		9.871% due 5/1/13 (f)			844,950
2,180,000		9.750% due 5/1/14			2,201,800
		Total Media			121,473,754
Metals & Mining — 1.7%
275,000		Chaparral Steel Co., Senior Notes, 10.000% due 7/15/13			308,000
2,810,000		Metals USA Holdings Corp., Senior Notes, 11.365% due 1/15/12 (e)(f)			2,760,825
5,685,000		Metals USA Inc., Senior Secured Notes, 11.125% due 12/1/15			6,303,244
1,305,000		RathGibson Inc., Senior Notes, 11.250% due 2/15/14			1,389,825
5,000,000		Republic Technologies International LLC/RTI Capital Corp., Senior Secured Notes, 13.750% due 7/15/09 (a)(b)(c)*			0
1,950,000		Tube City IMS Corp., Senior Subordinated Notes, 9.750% due 2/1/15 (e)			2,008,500
		Vale Overseas Ltd., Notes:
383,000		6.250% due 1/23/17			384,677
1,284,000		8.250% due 1/17/34			1,530,714
5,826,000		6.875% due 11/21/36			5,944,041
		Total Metals & Mining			20,629,826
Multiline Retail — 0.7%
		Neiman Marcus Group Inc.:
1,760,000		Senior Notes, 9.000% due 10/15/15 (d)			1,936,000
4,455,000		Senior Subordinated Notes, 10.375% due 10/15/15 (d)			5,000,737
1,543,000		Saks Inc., Notes, 9.875% due 10/1/11			1,730,089
		Total Multiline Retail			8,666,826
Oil, Gas & Consumable Fuels — 9.8%
5,145,000		Belden & Blake Corp., Secured Notes, 8.750% due 7/15/12			5,273,625
		Chesapeake Energy Corp., Senior Notes:
5,675,000		6.625% due 1/15/16			5,547,312
3,725,000		6.500% due 8/15/17			3,576,000
925,000		6.250% due 1/15/18			875,281
5,127,000		Cimarex Energy Co., Senior Notes, 9.600% due 3/15/12			5,389,759
1,005,000		Compagnie Generale de Geophysique SA, Senior Notes, 7.500% due 5/15/15			1,012,538
		El Paso Corp.:
		Medium-Term Notes:
5,025,000		7.800% due 8/1/31			5,389,312
7,525,000		7.750% due 1/15/32			8,070,562
5,200,000		Notes, 7.875% due 6/15/12			5,525,000
2,250,000		Enterprise Products Operating LP, Junior Subordinated Notes, 8.375% due 8/1/66 (f)			2,462,027
4,610,000		EXCO Resources Inc., Senior Notes, 7.250% due 1/15/11			4,702,200
		Gazprom:
		Bonds:
104,590,000		^RUB		Series A7, 6.790% due 10/29/09	3,949,882
34,860,000		^RUB		Series A8, 7.000% due 10/27/11	1,313,214
5,290,000		Loan Participation Notes, 6.212% due 11/22/16 (e)			5,231,810
50,960,000		^RUB	OAO, Series A6, 6.950% due 8/6/09		1,930,273
2,325,000		Inergy LP/Inergy Finance Corp., Senior Notes, 8.250% due 3/1/16			2,412,188

See Notes to Schedule of Investments.

Western Asset High Income Fund II Inc.

Schedule of Investments (unaudited) (continued)

January 31, 2007

Face Amount†		Security	Value
Oil, Gas & Consumable Fuels — 9.8% (continued)
$	3,705,000	International Coal Group Inc., Senior Notes, 10.250% due 7/15/14	$	3,667,950
1,465,000		Mariner Energy Inc., Senior Notes, 7.500% due 4/15/13	1,428,375
995,000		Northwest Pipeline Corp., Senior Notes, 7.000% due 6/15/16	1,042,263
490,000		OMI Corp., Senior Notes, 7.625% due 12/1/13	499,800
1,905,000		OPTI Canada Inc., Senior Secured Notes, 8.250% due 12/15/14 (e)	2,000,250
		Pemex Project Funding Master Trust:
1,846,000		6.125% due 8/15/08	1,857,076
250,000		7.375% due 12/15/14	271,250
1,298,000		Senior Notes, 5.970% due 12/3/12 (e)(f)	1,310,007
3,015,000		Petrohawk Energy Corp., Senior Notes, 9.125% due 7/15/13	3,135,600
		Petrozuata Finance Inc.:
4,544,000		8.220% due 4/1/17 (e)	4,289,149
		Pogo Producing Co., Senior Subordinated Notes:
1,130,000		7.875% due 5/1/13	1,144,125
2,000,000		Series B, 8.250% due 4/15/11	2,042,500
5,665,000		SemGroup LP, Senior Notes, 8.750% due 11/15/15 (e)	5,707,487
160,000		SESI LLC, Senior Notes, 6.875% due 6/1/14	157,600
3,715,000		Stone Energy Corp., Senior Subordinated Notes, 8.250% due 12/15/11	3,649,987
1,000,000		Swift Energy Co., Senior Subordinated Notes, 9.375% due 5/1/12	1,055,000
		Whiting Petroleum Corp., Senior Subordinated Notes:
2,550,000		7.250% due 5/1/12	2,543,625
1,975,000		7.000% due 2/1/14	1,955,250
		Williams Cos. Inc.:
90,000		Debentures, Series A, 7.500% due 1/15/31	94,050
		Notes:
3,650,000		7.875% due 9/1/21	3,942,000
6,225,000		8.750% due 3/15/32	7,112,062
3,700,000		Senior Notes, 7.625% due 7/15/19	3,968,250
		Total Oil, Gas & Consumable Fuels	115,534,639
Paper & Forest Products — 1.4%
		Appleton Papers Inc.:
395,000		Senior Notes, 8.125% due 6/15/11	408,825
4,685,000		Senior Subordinated Notes, Series B, 9.750% due 6/15/14	4,895,825
		NewPage Corp.:
		Senior Secured Notes:
1,110,000		10.000% due 5/1/12 (d)	1,215,450
4,290,000		11.621% due 5/1/12 (d)(f)	4,719,000
2,520,000		Senior Subordinated Notes, 12.000% due 5/1/13 (d)	2,759,400
1,000,000		Smurfit Capital Funding PLC, Debentures, 7.500% due 11/20/25	1,015,000
		Verso Paper Holdings LLC:
15,000		Senior Secured Notes, 9.125% due 8/1/14 (e)	15,825
1,500,000		Senior Subordinated Notes, 11.375% due 8/1/16 (e)	1,597,500
		Total Paper & Forest Products	16,626,825
Pharmaceuticals — 0.5%
4,020,000		Leiner Health Products Inc., Senior Subordinated Notes, 11.000% due 6/1/12	4,200,900
1,915,000		Valeant Pharmaceuticals International, Senior Notes, 7.000% due 12/15/11	1,847,975
		Total Pharmaceuticals	6,048,875
Real Estate Investment Trusts (REITs) — 1.1%
130,000		Forest City Enterprises Inc., Senior Notes, 7.625% due 6/1/15	134,225
		Host Marriott LP, Senior Notes:
2,500,000		7.125% due 11/1/13	2,550,000
3,400,000		Series O, 6.375% due 3/15/15	3,336,250

See Notes to Schedule of Investments.

Western Asset High Income Fund II Inc.

Schedule of Investments (unaudited) (continued)

January 31, 2007

Face Amount†		Security	Value
Real Estate Investment Trusts (REITs) — 1.1% (continued)
$	2,275,000	Kimball Hill Inc., Senior Subordinated Notes, 10.500% due 12/15/12	$	2,246,563
		Ventas Realty LP/Ventas Capital Corp., Senior Notes:
1,070,000		7.125% due 6/1/15	1,110,125
665,000		6.500% due 6/1/16	668,325
2,615,000		6.750% due 4/1/17	2,667,300
		Total Real Estate Investment Trusts (REITs)	12,712,788
Real Estate Management & Development — 0.1%
1,375,000		Ashton Woods USA LLC/Ashton Woods Finance Co., Senior Subordinated Notes, 9.500% due 10/1/15	1,326,875
Road & Rail — 1.6%
		Grupo Transportacion Ferroviaria Mexicana SA de CV, Senior Notes:
4,850,000		9.375% due 5/1/12	5,201,625
160,000		12.500% due 6/15/12	173,600
		Hertz Corp.:
3,930,000		8.875% due 1/1/14	4,195,275
7,165,000		10.500% due 1/1/16	8,096,450
910,000		Kansas City Southern de Mexico, Senior Notes, 7.625% due 12/1/13 (e)	914,550
840,000		Kansas City Southern Railway, Senior Notes, 7.500% due 6/15/09	855,750
		Total Road & Rail	19,437,250
Semiconductors & Semiconductor Equipment — 0.4%
5,035,000		Freescale Semiconductor Inc., Senior Notes, 8.875% due 12/15/14 (e)	5,035,000
Software — 0.5%
2,695,000		Activant Solutions Inc., Senior Subordinated Notes, 9.500% due 5/1/16 (e)	2,627,625
2,951,792		UGS Capital Corp. II, Senior Notes, 10.348% due 6/1/11 (e)(f)(g)	3,025,587
		Total Software	5,653,212
Specialty Retail — 0.6%
		AutoNation Inc., Senior Notes:
745,000		7.360% due 4/15/13 (f)	754,313
830,000		7.000% due 4/15/14	838,300
2,525,000		Blockbuster Inc., Senior Subordinated Notes, 9.000% due 9/1/12	2,531,312
1,995,000		Eye Care Centers of America, Senior Subordinated Notes, 10.750% due 2/15/15	2,221,931
1,370,000		Linens ‘n Things Inc., Senior Secured Notes, 10.985% due 1/15/14 (f)	1,335,750
		Total Specialty Retail	7,681,606
Textiles, Apparel & Luxury Goods — 0.8%
6,785,000		Levi Strauss & Co., Senior Notes, 9.750% due 1/15/15	7,361,725
2,950,000		Simmons Co., Senior Discount Notes, step bond to yield 9.995% due 12/15/14	2,433,750
		Total Textiles, Apparel & Luxury Goods	9,795,475
Tobacco — 0.2%
1,970,000		Alliance One International Inc., Senior Notes, 11.000% due 5/15/12	2,137,450
Trading Companies & Distributors — 1.0%
2,165,000		Ashtead Capital Inc., Notes, 9.000% due 8/15/16 (e)	2,327,375
2,755,000		H&E Equipment Services Inc., Senior Notes, 8.375% due 7/15/16	2,927,187
3,790,000		Penhall International Corp., Senior Secured Notes, 12.000% due 8/1/14 (e)	4,159,525
		TransDigm Inc., Senior Subordinated Notes:
1,810,000		7.750% due 7/15/14 (e)	1,831,293
775,000		7.750% due 7/15/14	794,375
		Total Trading Companies & Distributors	12,039,755

See Notes to Schedule of Investments.

Western Asset High Income Fund II Inc.

Schedule of Investments (unaudited) (continued)

January 31, 2007

Face Amount†		Security			Value
Wireless Telecommunication Services — 2.5%
$	1,825,000	American Tower Corp., Senior Notes, 7.500% due 5/1/12			$	1,895,719
4,180,000		Nextel Communications Inc., Senior Notes, Series D, 7.375% due 8/1/15			4,287,949
440,000		Rogers Wireless Communications Inc., Senior Secured Notes, 7.250% due 12/15/12			465,300
1,040,000		Rogers Wireless Inc., Senior Subordinated Notes, 8.000% due 12/15/12			1,099,800
		Rural Cellular Corp.:
1,090,000		Secured Notes, 8.250% due 3/15/12			1,141,775
2,590,000		Senior Notes, 9.875% due 2/1/10			2,758,350
11,050,000		True Move Co., Ltd., 10.750% due 12/16/13 (e)			10,939,500
3,900,000		UbiquiTel Operating Co., Senior Notes, 9.875% due 3/1/11			4,193,073
2,220,000		UBS Luxembourg SA, Notes, 8.250% due 5/23/16			2,345,763
		Total Wireless Telecommunication Services			29,127,229
		TOTAL CORPORATE BONDS & NOTES
		(Cost — $968,900,913)			993,352,097
ASSET-BACKED SECURITY — 0.0%
Diversified Financial Services — 0.0%
1,975,400		Airplanes Pass-Through Trust, Subordinated Notes, Series D, 10.875% due 3/15/19 (a)(b)(c)*
		(Cost - $2,052,466)			0
CONVERTIBLE BOND & NOTE — 0.1%
Automobiles — 0.1%
1,110,000		Ford Motor Co., Senior Notes, 4.250% due 12/15/36
		(Cost - $1,110,000)			1,265,400
MORTGAGE-BACKED SECURITY — 5.2%
FNMA — 5.2%
63,900,000		Federal National Mortgage Association (FNMA), 5.000% due 2/12/37 (h)
		(Cost - $61,084,406)			61,324,063
SOVEREIGN BONDS — 6.9%
Argentina — 0.6%
		Republic of Argentina:
1,400,000		^EUR	9.250% due 10/21/02 (c)		582,355
300,000		^EUR	9.000% due 6/20/03 (c)		128,690
250,000		^EUR	10.250% due 1/26/07 (c)		111,304
275,000		^EUR	8.000% due 2/26/08 (c)		120,200
664,500			5.590% due 8/3/12 (f)		631,616
6,634,286		^ARS	Bonds, 2.000% due 1/3/10 (f)		4,511,496
97,000		^EUR	GDP Linked Securities, 0.000% due 12/15/35 (f)		16,833
			Medium-Term Notes:
1,175,000		^EUR		7.000% due 3/18/04 (a)(c)	507,855
600,000		^EUR		8.125% due 10/4/04 (c)	249,581
525,000		^EUR		9.000% due 5/24/05 (c)(e)	226,061
		Total Argentina			7,085,991
Brazil — 1.5%
		Federative Republic of Brazil:
8,894,000		11.000% due 8/17/40 (d)			11,702,280
		Collective Action Securities:
2,005,000		8.750% due 2/4/25 (d)			2,469,659
3,449,000		Notes, 8.000% due 1/15/15 (d)			3,811,145
		Total Brazil			17,983,084

See Notes to Schedule of Investments.

Western Asset High Income Fund II Inc.

Schedule of Investments (unaudited) (continued)

January 31, 2007

Face Amount†		Security	Value
Colombia — 0.4%
		Republic of Colombia:
$	51,000	10.375% due 1/28/33	$	72,203
4,615,000		7.375% due 9/18/37	4,901,130
		Total Colombia	4,973,333
Ecuador — 0.1%
2,100,000		Republic of Ecuador, 10.000% due 8/15/30 (e)	1,648,500
El Salvador — 0.2%
		Republic of El Salvador:
1,300,000		7.750% due 1/24/23 (e)	1,488,500
270,000		8.250% due 4/10/32 (e)	322,650
		Total El Salvador	1,811,150
Indonesia — 0.1%
400,000		Republic of Indonesia, 8.500% due 10/12/35 (e)	490,000
Mexico — 1.2%
		United Mexican States:
50,000		11.375% due 9/15/16	71,000
		Medium-Term Notes:
1,579,000		6.750% due 9/27/34	1,678,477
		Series A:
1,944,000		5.875% due 1/15/14	1,971,216
8,795,000		8.000% due 9/24/22	10,575,987
		Total Mexico	14,296,680
Panama — 0.2%
		Republic of Panama:
1,285,000		9.625% due 2/8/11	1,461,688
350,000		7.250% due 3/15/15	376,250
		Total Panama	1,837,938
Peru — 0.4%
		Republic of Peru:
708,000		8.750% due 11/21/33	910,134
168,000		FLIRB, 5.000% due 3/7/17 (e)(f)	167,622
198,000		Global Bonds, 7.350% due 7/21/25	218,097
		PDI:
3,085,600		5.000% due 3/7/17 (f)	3,076,343
256,120		5.000% due 3/7/17 (e)(f)	255,864
		Total Peru	4,628,060
Philippines — 0.2%
1,975,000		Republic of the Philippines, 9.500% due 2/2/30	2,613,123
Russia — 0.4%
		Russian Federation:
330,561		8.250% due 3/31/10 (e)	344,196
244,000		12.750% due 6/24/28 (e)	436,760
3,372,000		5.000% due 3/31/30 (e)	3,753,458
		Total Russia	4,534,414
South Africa — 0.1%
		Republic of South Africa:
575,000		9.125% due 5/19/09	618,700
725,000		6.500% due 6/2/14	760,344
		Total South Africa	1,379,044

See Notes to Schedule of Investments.

Western Asset High Income Fund II Inc.

Schedule of Investments (unaudited) (continued)

January 31, 2007

Face
Amount†		Security	Value
Turkey — 0.6%
		Republic of Turkey:
$	2,106,000	11.500% due 1/23/12	$	2,569,317
315,000		11.000% due 1/14/13	385,402
490,000		7.000% due 6/5/20	491,225
335,000		11.875% due 1/15/30	511,713
594,000		Bonds, 7.000% due 9/26/16	602,019
1,464,000		Collective Action Securities, Notes, 9.500% due 1/15/14	1,701,900
587,000		Notes, 6.875% due 3/17/36	556,916
		Total Turkey	6,818,492
Uruguay — 0.1%
1,026,307		Republic of Uruguay, Bonds, 7.625% due 3/21/36	1,104,306

Venezuela — 0.8%
		Bolivarian Republic of Venezuela:
10,246,000		5.750% due 2/26/16	9,387,897
241,000		7.650% due 4/21/25	251,544
183,000		Collective Action Securities, Notes, 10.750% due 9/19/13	220,058
		Total Venezuela	9,859,499
		TOTAL SOVEREIGN BONDS
		(Cost — $77,351,271)	81,063,614
LOAN PARTICIPATION — 0.1%
United States — 0.1%
1,500,000		Verso Paper Holdings Term Loan, 1.000% due 2/1/12
		(Cost - $1,500,000)	1,503,750
Shares
COMMON STOCKS — 0.0%
CONSUMER DISCRETIONARY — 0.0%
Household Durables — 0.0%
10,685,938		Home Interiors & Gifts Inc. (a)(b)(c)*	106,859
52,472		Mattress Discounters Corp. (a)(b)*	0
		TOTAL CONSUMER DISCRETIONARY	106,859
CONSUMER STAPLES — 0.0%
Food Products — 0.0%
3,784		Imperial Sugar Co.	117,872
		TOTAL COMMON STOCKS
		(Cost — $7,846,354)	224,731
PREFERRED STOCKS — 0.5%
CONSUMER DISCRETIONARY — 0.4%
Automobiles — 0.1%
65,000		Ford Motor Co., 7.400%	1,180,400
1,800		Ford Motor Co., 8.000%	35,100
1,800		Ford Motor Co., Series F, 7.550%	32,670
		Total Automobiles	1,248,170
Media — 0.3%
387		ION Media Networks Inc., 13.250% (g)	2,941,200
		TOTAL CONSUMER DISCRETIONARY	4,189,370
FINANCIALS — 0.1%
Diversified Financial Services — 0.1%
12,100		Preferred Plus, Series FRD-1, 7.400%	220,220
8,200		Preferred Plus, Series FMC1 Trust, Senior Debentures, Series LMG-3, 8.250%	168,920

See Notes to Schedule of Investments.

Western Asset High Income Fund II Inc.

Schedule of Investments (unaudited) (continued)

January 31, 2007

Shares	Security	Value
Diversified Financial Services — 0.1% (continued)
44,100	Saturns, Series F 2003-5, 8.125%	$	863,478
17,552	TCR Holdings Corp., Class B Shares (a)(b)*	17
9,654	TCR Holdings Corp., Class C Shares (a)(b)*	10
25,451	TCR Holdings Corp., Class D Shares (a)(b)*	25
52,657	TCR Holdings Corp., Class E Shares (a)(b)*	53
	TOTAL FINANCIALS	1,252,723
	TOTAL PREFERRED STOCKS
	(Cost — $5,156,455)	5,442,093
CONVERTIBLE PREFERRED STOCKS — 0.1%
ENERGY — 0.1%
Oil, Gas & Consumable Fuels — 0.1%
5,355	Chesapeake Energy Corp., Convertible, 6.250%
	(Cost - $1,345,637)	1,365,525
ESCROWED SHARES — 0.0%
8,800,000	Breed Technologies Inc. (a)(b)(c)*	0
2,025,000	Pillowtex Corp. (a)(b)(c)*	0
2,648,056	Vlasic Foods International Inc. (a)(b)(c)*	52,961
	TOTAL ESCROWED SHARES
	(Cost — $0)	52,961

Warrants
WARRANTS — 0.1%
18,500	Bolivarian Republic of Venezuela, Oil-linked payment obligations, Expires 4/15/20*	629,000
3,500	Brown Jordan International Inc., Expires 8/15/07(a)(e)*	35
30,928,049	ContiFinancial Corp., Liquidating Trust, Units of Interest (Represents interest in a trust in the liquidation of ContiFinancial Corp. and its affiliates)(a)(c)*	93
2,750	Leap Wireless International Inc., Expires 4/15/10(a)(b)(e)*	0
3,500	Mattress Discounters Co., Expires 7/15/07(a)(b)(e)*	0
13,614	Pillowtex Corp., Expires 11/24/09(a)(b)*	0
5,000	UbiquiTel Inc., Expires 4/15/10(a)(b)(e)*	50
	TOTAL WARRANTS
	(Cost — $538,361)	629,178
	TOTAL INVESTMENTS BEFORE SHORT-TERM INVESTMENTS
	(Cost — $1,126,885,863)	1,146,223,412

Face
Amount†
SHORT-TERM INVESTMENTS — 2.8%
Certificate of Deposit (Yankee) — 0.1%
$	1,800,000	UBS AG Jersey Branch, Medium-Term Notes, 7.684% due 4/12/07
		(Cost - $1,806,480)		1,806,480
Sovereign Bonds — 1.2%
		Egypt Treasury Bills:
5,500,000		^EGP	Zero coupon bond to yield 9.724% due 4/17/07	946,706
47,100,000		^EGP	Zero coupon bond to yield 9.643% due 10/30/07	7,721,724
33,275,000		^EGP	Zero coupon bond to yield 9.307% due 11/6/07	5,447,911
		Total Sovereign Bonds
		(Cost — $14,039,486)		14,116,341
Repurchase Agreement — 1.5%
17,200,000		Nomura Securities International Inc. repurchase agreement dated 1/31/07, 5.240% due 2/1/07; Proceeds at maturity - $17,202,504; (Fully collateralized by various U.S. government agency obligations, 4.250% to 5.500% due 5/16/08 to 1/23/12; Market value - $17,548,789)
		(Cost - $17,200,000) (d)		17,200,000

See Notes to Schedule of Investments.

Western Asset High Income Fund II Inc.

Schedule of Investments (unaudited) (continued)

January 31, 2007

*	Non-income producing security.
†	Face amount denominated in U.S. dollars, unless otherwise noted.
(a)	Illiquid security.
(b)	Security is valued in good faith at fair value by or under the direction of the Board of Directors (See Note 1).
(c)	Security is currently in default.
(d)	All or a portion of this security is segregated for extended settlements, reverse repurchase agreements and TBA’s.
(e)	Security is exempt from registration under Rule 144A of the Securities Act of 1933. This security may be resold in transactions that are exempt from registration, normally to qualified institutional buyers. This security has been deemed liquid pursuant to guidelines approved by the Board of Directors, unless otherwise noted.
(f)	Variable rate security. Interest rate disclosed is that which is in effect at January 31, 2007.
(g)	Payment-in-kind security for which part of the income earned may be paid as additional principal.
(h)	This security is traded on a to-be-announced (“TBA”) basis (See Note 1).
#	Aggregate cost for federal income tax purposes is substantially the same.

	Abbreviations used in this schedule:
	ARS - Argentine Peso
	EGP - Egyptian Pound
	EUR - Euro
	FLIRB - Front-Loaded Interest Reduction Bonds
	GDP - Gross Domestic Product
	MXN - Mexican Peso
	PDI - Past Due Interest
	RUB - Russian Ruble

See Notes to Schedule of Investments.

Notes to Schedule of Investments (unaudited)

1. Organization and Significant Accounting Policies

Western Asset High Income Fund II Inc. (the “Fund”) was incorporated in Maryland and is registered as a diversified, closed-end management investment company under the Investment Company Act of 1940, as amended, (the “1940 Act”). The Fund seeks to maximize current income by investing at least 80% of its net assets plus any borrowings for investment purposes in high yield debt securities. As a secondary objective, the Fund seeks capital appreciation to the extent consistent with its objective of seeking to maximize current income.

The following are significant accounting policies consistently followed by the Fund and are in conformity with U.S. generally accepted accounting principles (“GAAP”).

(a) Investment Valuation. Debt securities are valued at the mean between the bid and asked prices provided by an independent pricing service that are based on transactions in debt obligations, quotations from bond dealers, market transactions in comparable securities and various other relationships between securities. Equity securities for which market quotations are available are valued at the last sale price or official closing price on the primary market or exchange on which they trade. Publicly traded foreign government debt securities are typically traded internationally in the over-the-counter market, and are valued at the mean between the bid and asked prices as of the close of business of that market. When prices are not readily available, or are determined not to reflect fair value, such as when the value of a security has been significantly affected by events after the close of the exchange or market on which the security is principally traded, but before the Fund calculates its net asset value, the Fund may value these investments at fair value as determined in accordance with the procedures approved by the Fund’s Board of Directors. Short-term obligations with maturities of 60 days or less are valued at amortized cost, which approximates market value.

(b) Repurchase Agreements. When entering into repurchase agreements, it is the Fund’s policy that its custodian or a third party custodian take possession of the underlying collateral securities, the market value of which at least equals the principal amount of the repurchase transaction, including accrued interest. To the extent that any repurchase transaction exceeds one business day, the value of the collateral is marked-to-market to ensure the adequacy of the collateral. If the seller defaults, and the market 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.

(c) Reverse Repurchase Agreements. The Fund may enter into reverse repurchase agreements in which the Fund sells portfolio securities and agrees to repurchase them from the buyer at a specified date and price. Whenever the Fund enters into a reverse repurchase agreement, the Fund’s custodian delivers liquid assets to the counterparty in an amount at least equal to the repurchase price (including accrued interest). The Fund pays interest on amounts obtained pursuant to reverse repurchase agreements. Reverse repurchase agreements are considered to be borrowings, which may create leverage risk to the Fund.

(d) Securities Traded on a To-Be-Announced Basis. The Fund may trade securities on a to-be-announced (“TBA”) basis. In a TBA transaction, the Fund commit to purchasing or selling securities, which have not yet been issued by the issuer and for which specific information is not known, such as the face amount and maturity date and the underlying pool of investments in U.S. government agency mortgage pass-through transactions. Securities purchased on a TBA basis are not settled until they are delivered to the Fund, normally 15 to 45 days later. Beginning on the date the Fund enter into a TBA transaction, cash, U.S. government securities or other liquid high-grade debt obligations are segregated in an amount equal in value to the purchase price of the TBA security. These transactions are subject to market fluctuations and their current value is determined in the same manner as for other securities.

(e) Loan Participations. The Fund may invest in loans arranged through private negotiation between one or more financial institutions. The Fund’s investment in any such loan may be in the form of a participation in or an assignment of the loan. In connection with purchasing participations, the Fund generally will have no right to enforce compliance by the borrower with the terms of the loan agreement relating to the loan, nor any rights of set-off against the borrower and the Fund may not benefit directly from any collateral supporting the loan in which it has purchased the participation.

The Fund assumes the credit risk of the borrower, the lender that is selling the participation and any other persons interpositioned between the Fund and the borrower. In the event of the insolvency of the lender selling the participation, the Fund may be treated as a general creditor of the lender and may not benefit from any set-off between the lender and the borrower.

Notes to Schedule of Investments (unaudited) (continued)

(f) Credit and Market Risk. The Fund invests in high yield and emerging market instruments that are subject to certain credit and market risks. The yields of high yield and emerging market debt obligations reflect, among other things, perceived credit and market risks. The Fund’s investment in securities rated below investment grade typically involve risks not associated with higher rated securities including, among others, greater risk related to timely and ultimate payment of interest and principal, greater market price volatility and less liquid secondary market trading. The consequences of political, social, economic or diplomatic changes may have disruptive effects on the market prices of investments held by the Fund. The Fund’s investment in non-dollar denominated securities may also result in foreign currency losses caused by devaluations and exchange rate fluctuations.

(g) Foreign Currency Translation. Investment securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts based upon prevailing exchange rates on the date of valuation. Purchases and sales of investment securities and income and expense items denominated in foreign currencies are translated into U.S. dollar amounts based upon prevailing exchange rates on the respective dates of such transactions.

Foreign security and currency transactions may involve certain considerations and risks not typically associated with those of U.S. dollar denominated transactions as a result of, among other factors, the possibility of lower levels of governmental supervision and regulation of foreign securities markets and the possibility of political or economic instability.

(h) Security Transactions. Security transactions are accounted for on a trade date basis.

2. Investments

At January 31, 2007, the aggregate gross unrealized appreciation and depreciation of investments for federal income tax purposes were substantially as follows:

Gross unrealized appreciation	$	47,916,499
Gross unrealized depreciation	(28,502,095		)
Net unrealized appreciation	$	19,414,404

Transactions in reverse repurchase agreements for the Fund during the period ended January 31, 2007 were as follows:

Average		Weighted		Maximum
Daily		Average		Amount
Balance		Interest Rate		Outstanding
$	63,634,084	5.185	%	$	90,229,562

Interest rates on reverse repurchase agreements ranged from 1.00% to 5.400% during the period ended January 31, 2007.

At January 31, 2007, the Fund had the following reverse repurchase agreements outstanding:

FACE
AMOUNT		SECURITY	VALUE
$	1,565,602	Reverse Repurchase Agreement with Credit Suisse First Boston, dated 11/21/06 bearing 5.350% to be repurchased at $1,582,586 on 2/2/07, collateralized by: $1,464,000 Republic of Turkey, 9.500% due 1/15/14; Market value (including accrued interest) - $1,708,431.	$	1,565,602

2,380,201		Reverse Repurchase Agreement with Credit Suisse First Boston, dated 11/21/06 bearing 5.350% to be repurchased at $2,407,438 on 2/6/07, collateralized by: $2,106,000 Republic of Turkey, 11.500% due 1/23/12; Market value (including accrued interest) - $2,575,339.	2,380,201

4,706,513		Reverse Repurchase Agreement with Credit Suisse First Boston, dated 1/22/07 bearing 5.250% to be repurchased at $4,714,063 on 2/02/07, collateralized by: $5,290,000 Gazprom, 6.212% due 11/22/16; Market value (including accrued interest) - $5,296,266.	4,706,513

Notes to Schedule of Investments (unaudited) (continued)

$	1,026,990	Reverse Repurchase Agreement with Credit Suisse First Boston, dated 1/9/07 bearing 5.350% to be repurchased at $1,031,111 on 2/5/07, collateralized by: $900,000 Republic of Venezuela, 10.750% due 9/19/13; Market value (including accrued interest) - $1,146,253	$	1,026,990

3,740,054		Reverse Repurchase Agreement with Credit Suisse First Boston, dated 1/18/07 bearing 1.50% to be repurchased at $3,742,859 on 2/5/07, collateralized by: $3,169,000 Republic of Venezuela, 9.375% due 1/13/34; Market value (including accrued interest) - $4,171,856.	3,740,054

2,439,325		Reverse Repurchase Agreement with Credit Suisse First Boston, dated 11/9/06 bearing 5.250% to be repurchased at an amount and date to be determined, collateralized by: $2,650,000 Russian Agricultural bank, 7.175% due 5/16/13; Market value (including accrued interest) - $2,805,719.	2,439,325

1,699,243		Reverse Repurchase Agreement with Credit Suisse First Boston, dated 11/9/06 bearing 5.250% to be repurchased at an amount and date to be determined, collateralized by: $1,846,000 Pemex Project Funding Master Trust, 6.125% due 8/15/08; Market value (including accrued interest) - $1,909,308.	1,699,243

2,347,287		Reverse Repurchase Agreement with Credit Suisse First Boston, dated 11/9/06 bearing 5.250% to be repurchased at an amount and date to be determined, collateralized by: $1,975,000 Republic of the Philippines, 10.625% due 3/16/25; Market value (including accrued interest) - $2,706,425.	2,347,287

9,695,608		Reverse Repurchase Agreement with Credit Suisse First Boston, dated 11/22/06 bearing 5.300% to be repurchased at $9,792,672 on 1/29/07, collateralized by: $8,795,000 United Mexican States, Medium-Term Notes, 8.000% due 9/24/22; Market value (including accrued interest) - $10,828,662	9,695,608

4,888,779		Reverse Repurchase Agreement with Credit Suisse First Boston, dated 11/24/06 bearing 5.300% to be repurchased at $4,941,320 on 2/5/07, collateralized by: $5,145,000 Republic of Colombia, 7.375% due 9/18/37; Market value (including accrued interest) - $5,027,750.	4,888,779

936,915		Reverse Repurchase Agreement with Credit Suisse First Boston, dated 11/21/06 bearing 5.350% to be repurchased at an amount and date to be determined, collateralized by: $1,050,000 Petrozuata Finance Inc, 8.220% due 4/1/17; Market value (including accrued interest) - $1,018,737.	936,915

860,297		Reverse Repurchase Agreement with JPMorgan Chase & Co., dated 11/21/06 bearing 5.350% to be repurchased at an amount and date to be determined, collateralized by: $965,000 Republic of Turkey, 11.875% due 1/15/30; Market value (including accrued interest) - $981,960.	860,297

4,703,530		Reverse Repurchase Agreement with Credit Suisse First Boston, dated 11/30/06 bearing 5.400% to be repurchased at an amount and date to be determined, collateralized by: $4,850,000 Grupo Transportacion Ferroviaria Mexicana SA de CV, 9.375% due 5/1/12; Market value (including accrued interest) - $5,317,181.	4,703,530

1,323,416		Reverse Repurchase Agreement with Credit Suisse First Boston, dated 11/30/06 bearing 5.350% to be repurchased at an amount and date to be determined, collateralized by: $1,360,000 TNK–BP Finance SA, 7.500% due 7/18/16; Market value (including accrued interest) - $1,427,457.	1,323,416

Notes to Schedule of Investments (unaudited) (continued)

$	2,778,664	Reverse Repurchase Agreement with Credit Suisse First Boston, dated 11/30/06 bearing 5.350% to be repurchased at an amount and date to be determined, collateralized by: $4,060,000 Republic of Peru, 5.000% due 8/7/17; Market value (including accrued interest) - $3,138,993.	$	2,778,664

1,372,410		Reverse Repurchase Agreement with Credit Suisse First Boston, dated 12/4/06 bearing 5.250% to be repurchased at an amount and date to be determined, collateralized by: $1,300,000 Republic of EL Salvador, 7.750% due 1/24/23; Market value (including accrued interest)	$		1,372,410

1,358,334		Reverse Repurchase Agreement with Credit Suisse First Boston, dated 12/14/06 bearing 5.350% to be repurchased at $1,369,033 on 2/5/07, collateralized by: $1,020,000 United Mexican States, 11.375% due 9/15/16; Market value (including accrued interest) - $1,531,920.	1,358,334

1,297,331		Reverse Repurchase Agreement with Credit Suisse First Boston, dated 12/14/06 bearing 5.250% to be repurchased at an amount and date to be determined, collateralized by: $1,295,000 Enersis SA, 7.375% due 1/15/14; Market value (including accrued interest) - $1,410,765.	1,297,331

2,305,149		Reverse Repurchase Agreement with Credit Suisse First Boston, dated 1/8/07 bearing 5.350% to be repurchased at an amount and date to be determined, collateralized by: $2,005,000 Federative Republic of Brazil, 8.750% due 2/4/25; Market value (including accrued interest) - $2,555,947.	2,305,149

790,778		Reverse Repurchase Agreement with Credit Suisse First Boston, dated 1/24/07 bearing 5.250% to be repurchased at an amount and date to be determined, collateralized by: $668,000 Republic of Peru, 8.750% due 11/21/33; Market value (including accrued interest) - $870,339.	790,778

2,863,757		Reverse Repurchase Agreement with Credit Suisse First Boston, dated 1/25/07 bearing 5.350% to be repurchased at $2,875,248 on 2/21/07, collateralized by: $2,795,000 Russian Federation, 5.000% due 3/31/30; Market value (including accrued interest) - $3,158,792.	2,863,757

15,409,746		Reverse Repurchase Agreement with Credit Suisse First Boston, dated 1/31/07 bearing 5.250% to be repurchased at $15,420,982 on 2/5/07, collateralized by: $12,564,000 Federative Republic of Brazil, 11.000% due 8/17/40; Market value (including accrued interest) - $17,342,719.	15,409,746

3,424,857		Reverse Repurchase Agreement with Credit Suisse First Boston, dated 1/31/07 bearing 5.300% to be repurchased at an amount and date to be determined, collateralized by: $3,449,000 Federative Republic of Brazil, 8.000% due 1/15/15; Market value (including accrued interest) - $3,824,103.	3,424,857

2,644,827		Reverse Repurchase Agreement with Credit Suisse First Boston, dated 1/31/07 bearing 5.250% to be repurchased at $2,647,141 on 2/06/07, collateralized by: $2,894,000 United Mexican States, 8.875% due 1/15/14; Market value (including accrued interest) - $2,942,479.	2,644,827

Notes to Schedule of Investments (unaudited) (continued)

$	1,362,375	Reverse Repurchase Agreement with Credit Suisse First Boston, dated 1/31/07 bearing 5.250% to be repurchased at an amount and date to be determined, collateralized by: $2,100,000 Republic Of Ecuador, 10.000% due 8/15/30; Market value (including accrued interest) - $1,745,511.		$		1,362,375

8,525,697		Reverse Repurchase Agreement with Credit Suisse First Boston, dated 1/31/07 bearing 5.350% to be repurchased at an amount and date to be determined, collateralized by: $10,246,000 Republic of Venezuela, 5.750% due 2/26/16; Market value (including accrued interest) - $9,642,333.		8,525,697

		Total Reverse Repurchase Agreements
		(Proceeds - $86,447,685)	$		86,447,685

3. Loan

At January 31, 2007, the Fund had a $125,000,000 loan outstanding pursuant to a revolving credit and security agreement among the Fund, CIESCO, LLC and Citibank, N.A.. The loan generally bears interest at a variable rate based on the weighted average interest rates of the underlying commercial paper or LIBOR plus any applicable margin. Securities held by the Fund are subject to a lien, granted to the lender, to the extent of the borrowings outstanding and any additional expenses.

ITEM 2.	CONTROLS AND PROCEDURES.

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

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

ITEM 3.	EXHIBITS.

	Certifications pursuant to Rule 30a-2(a) under the Investment Company Act of 1940, as amended, are attached hereto.

TOTAL SHORT-TERM INVESTMENTS

(Cost — $33,045,966)

TOTAL INVESTMENTS — 100.0% (Cost — $1,159,931,829#)

1,179,346,233

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Western Asset High Income Fund II Inc.

By:	/s/ R. Jay Gerken
R. Jay Gerken
Chief Executive Officer

Date:		March 29, 2007

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By:	/s/ R. Jay Gerken
R. Jay Gerken
Chief Executive Officer

Date:		March 29, 2007

By:	/s/ Frances M. Guggino
Frances M. Guggino
Chief Financial Officer

Date:		March 29, 2007