Fannie Mae Redemption

WASHINGTON, January 7, 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    Maturity      CUSIP     Redemption
       Amount      Type      Rate        Date                    Date

    $250,000,000    MTN     4.000%    January 18,  31398ALB6   January 18,
                                         2013                     2011
     $50,000,000    MTN     1.125%      July 19,   3136FMQ80   January 19,
                                         2013                     2011
     $50,000,000    MTN     2.000%      July 19,   3136FMS70   January 19,
                                         2013                     2011
    $500,000,000    MTN     4.060%    January 19,  31398AD58   January 19,
                                         2017                     2011
    $500,000,000    MTN     1.500%      July 19,   31398AV82   January 19,
                                         2013                     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 the light of your circumstances and financial
position. If you are in any doubt you should consult an appropriately
qualified financial advisor.

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