Fannie Mae Redemption

WASHINGTON, July 25, 2011 -

Fannie Mae (OTC Bulletin Board: FNMA) will redeem the principal
amounts indicated for the following securities issues on the
redemption dates indicated below at a redemption price equal to 100
percent of the principal amount redeemed, plus accrued interest
thereon to the date of redemption:

      Principal  Security Interest                              Redemption
       Amount      Type     Rate    Maturity Date     CUSIP        Date
     $50,000,000   MTN    2.500%   August 4, 2016   3136FM3F9  August 4, 2011
    $100,000,000   MTN    1.500%   August 4, 2015   3136FM5D2  August 4, 2011
    $100,000,000   MTN    1.830%  February 4, 2015  3136FM5X8  August 4, 2011
    $100,000,000   MTN    1.320%  February 4, 2014  3136FM5Y6  August 4, 2011
    $100,000,000   MTN    1.600%   August 4, 2014   3136FM5Z3  August 4, 2011
     $75,000,000   MTN    1.750%   August 4, 2014   3136FM6B5  August 4, 2011
     $50,000,000   MTN    1.900%  February 4, 2015  3136FM6M1  August 4, 2011
     $50,000,000   MTN    3.000%   August 4, 2015   3136FMX33  August 4, 2011
     $50,000,000   MTN    1.500%  February 4, 2016  3136FP4W4  August 4, 2011
     $50,000,000   MTN    2.050%  February 4, 2021  3136FP5T0  August 4, 2011
     $50,000,000   MTN    1.750%   August 4, 2014   3136FP5V5  August 4, 2011

Fannie Mae exists to expand affordable housing and bring
global capital to local communities in order to serve the U.S.
housing market. Fannie Mae has a federal charter and operates in
America’s secondary mortgage market to enhance the liquidity of the
mortgage market by providing funds to mortgage bankers and other
lenders so that they may lend to home buyers. Our job is to help
those who house America.

This press release does not
constitute an offer to sell or the solicitation of an offer to buy
securities of Fannie Mae. Nothing in this press release constitutes
advice on the merits of buying or selling a particular investment.
Any investment decision as to any purchase of securities referred
to herein must be made solely on the basis of information contained
in Fannie Mae’s applicable Offering Circular, and that no reliance
may be placed on the completeness or accuracy of the information
contained in this press release.

You should not deal in securities
unless you understand their nature and the extent of your exposure
to risk. You should be satisfied that they are suitable for you in
light of your circumstances and financial position. If you are in
any doubt you should consult an appropriately qualified financial
advisor.

Katherine Constantinou, Fannie Mae, +1-202-752-5403