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 811-09191 Name of Fund: BlackRock MuniHoldings Insured Fund II, Inc. (MUE) Fund Address: 100 Bellevue Parkway, Wilmington, DE 19809 Name and address of agent for service: Donald C. Burke, Chief Executive Officer, BlackRock MuniHoldings Insured Fund II, Inc., 800 Scudders Mill Road, Plainsboro, NJ 08536. Mailing address: P.O. Box 9011, Princeton, NJ 08543-9011 Registrant's telephone number, including area code: (800) 882-0052, Option 4 Date of fiscal year end: 07/31/2009 Date of reporting period: 08/01/2008 - 10/31/2008 Item 1 - Schedule of Investments BlackRock MuniHoldings Insured Fund II, Inc. Schedule of Investments October 31, 2008 (Unaudited) (Percentages shown are based on Net Assets) Par State Municipal Bonds (000) Value ----------------------------------------------------------------------------------------------------------------------------------- Alabama - 1.2% Jefferson County, Alabama, Limited Obligation School Warrants, Series A, 5.50%, 1/01/22 $ 3,580 $ 3,004,730 ----------------------------------------------------------------------------------------------------------------------------------- Alaska - 1.4% Anchorage, Alaska, Water Revenue Refunding Bonds, 6%, 9/01/24 (a) 1,630 1,672,266 Matanuska-Susitna Boro, Alaska, GO, Series A, 6%, 3/01/10 (b)(c) 1,700 1,783,147 -------------- 3,455,413 ----------------------------------------------------------------------------------------------------------------------------------- Arkansas - 4.4% Arkansas State Development Finance Authority, M/F Mortgage Revenue Refunding Bonds, Series C, 5.35%, 12/01/35 (c)(d) 12,215 10,644,517 ----------------------------------------------------------------------------------------------------------------------------------- California - 19.3% California State Various Purpose, GO, 5.25%, 12/01/22 (e) 2,935 2,940,635 California State Veterans, GO, Refunding, AMT, Series BZ, 5.35%, 12/01/21 (c) 9,350 8,506,724 Dixon, California, Unified School District, GO (Election of 2002), 5.20%, 8/01/44 (e) 2,405 2,196,943 Eastern Municipal Water District, California, Water and Sewer, COP, Series H, 5%, 7/01/35 1,175 1,030,839 Los Angeles County, California, Metropolitan Transportation Authority, Sales Tax Revenue Refunding Bonds, Proposition C, VRDN, Second Senior Series A, 8%, 7/01/20 (c)(f)(g) 5,000 5,000,000 Modesto, California, Schools Infrastructure Financing Agency, Special Tax Bonds, 5.50%, 9/01/36 (a) 4,240 3,731,666 Port of Oakland, California, Revenue Bonds, AMT, Series K, 5.75%, 11/01/21 (c)(h) 3,000 2,703,900 Port of Oakland, California, Revenue Refunding Bonds, AMT, Series L, 5.375%, 11/01/27 (c)(h) 5,000 4,146,450 Roseville, California, Joint Union High School District, GO (Election of 2004), Series A, 5%, 8/01/29 (c)(h) 2,985 2,773,513 Sacramento, California, City Financing Authority, Capital Improvement Revenue Bonds, 5%, 12/01/27 (a) 150 139,357 Sacramento County, California, Airport System Revenue Bonds, AMT, Senior Series B, 5.25%, 7/01/39 (e) 5,350 4,052,892 San Diego, California, Community College District, GO (Election of 2002), 5%, 5/01/30 (e) 1,485 1,390,272 San Francisco, California, City and County Airport Commission, International Airport, Special Facilities Lease Revenue Bonds (SFO Fuel Company LLC), AMT, Series A, 6.10%, 1/01/20 (e) 1,250 1,189,663 Stockton, California, Public Financing Revenue Bonds (Redevelopment Projects), Series A, 5.25%, 9/01/31 (i) 495 408,613 Portfolio Abbreviations To simplify the listings of portfolio holdings in the Schedule of Investments, the names and descriptions of many of the securities have been abbreviated according to the list below. AMT Alternative Minimum Tax (subject to) CABS Capital Appreciation Bonds COP Certificates of Participation EDA Economic Development Authority GO General Obligation Bonds HFA Housing Finance Agency IDA Industrial Development Authority M/F Multi-Family PCR Pollution Control Revenue Bonds S/F Single-Family VRDN Variable Rate Demand Notes BlackRock MuniHoldings Insured Fund II, Inc. Schedule of Investments October 31, 2008 (Unaudited) (Percentages shown are based on Net Assets) Par State Municipal Bonds (000) Value ----------------------------------------------------------------------------------------------------------------------------------- Stockton, California, Public Financing Revenue Bonds (Redevelopment Projects), Series A, 5.25%, 9/01/34 (i) $ 2,930 $ 2,365,448 Vista, California, COP (Community Projects), 5%, 5/01/37 (c) 5,400 4,538,268 -------------- 47,115,183 ----------------------------------------------------------------------------------------------------------------------------------- Colorado - 4.6% Aurora, Colorado, COP, 5.75%, 12/01/10 (a)(b) 6,285 6,705,718 Colorado HFA, Revenue Refunding Bonds (S/F Program), AMT, Senior Series A-2, 7.50%, 4/01/31 190 200,095 Colorado Health Facilities Authority, Hospital Revenue Refunding Bonds (Poudre Valley Health Care), Series A, 5.75%, 12/01/09 (b)(e) 4,000 4,212,520 -------------- 11,118,333 ----------------------------------------------------------------------------------------------------------------------------------- Connecticut - 0.6% Connecticut State, GO, Refunding, Series D, 5%, 12/01/24 (c) 1,520 1,525,472 ----------------------------------------------------------------------------------------------------------------------------------- District of Columbia - 0.9% District of Columbia, Deed Tax Revenue Bonds (Housing Production Trust Fund - New Communities Project), Series A, 5%, 6/01/32 (c) 2,500 2,161,125 ----------------------------------------------------------------------------------------------------------------------------------- Florida - 33.2% Brevard County, Florida, Health Facilities Authority, Healthcare Facilities Revenue Bonds (Health First, Inc. Project), 5%, 4/01/34 2,600 1,726,842 Broward County, Florida, HFA, S/F Mortgage Revenue Refunding Bonds, AMT, Series E, 5.90%, 10/01/39 (j)(k)(l) 2,310 2,144,050 Broward County, Florida, School Board, COP, Series A, 5.25%, 7/01/33 (e) 5,600 5,095,832 Hillsborough County, Florida, HFA, S/F Mortgage Revenue Bonds, AMT, Series 1, 5.375%, 10/01/49 (j)(k)(l) 3,385 2,873,323 Hillsborough County, Florida, IDA, Hospital Revenue Bonds (H. Lee Moffitt Cancer Center Project), Series A, 5.25%, 7/01/37 4,700 3,404,774 Hillsborough County, Florida, IDA, PCR, Refunding (Tampa Electric Company Project), Series B, 5.15%, 9/01/25 1,200 1,188,300 Jacksonville, Florida, Health Facilities Authority, Hospital Revenue Bonds (Baptist Medical Center Project), 5%, 8/15/37 (e) 7,740 6,770,333 Jacksonville, Florida, Port Authority Revenue Bonds, AMT, 6%, 11/01/38 (m) 6,250 5,562,812 Lee Memorial Health System, Florida, Hospital Revenue Bonds, Series A, 5%, 4/01/32 (a) 5,000 4,392,250 Miami, Florida, Special Obligation Revenue Bonds (Street and Sidewalk Improvement Program), 5%, 1/01/37 (c) 2,900 2,442,351 Miami-Dade County, Florida, Aviation Revenue Bonds, AMT, Series A, 5%, 10/01/33 (e) 6,730 5,063,719 Miami-Dade County, Florida, Aviation Revenue Refunding Bonds (Miami International Airport), AMT, Series A, 5.25%, 10/01/41 (e) 13,800 10,343,790 Miami-Dade County, Florida, Aviation Revenue Refunding Bonds (Miami International Airport), AMT, Series A, 5.50%, 10/01/41 (e) 6,700 5,251,125 Miami-Dade County, Florida, School Board, COP, Refunding, Series B, 5.25%, 5/01/28 (m) 5,000 4,788,250 Miami-Dade County, Florida, School Board, COP, Refunding, Series B, 5.25%, 5/01/31 (m) 3,600 3,404,772 Miami-Dade County, Florida, Special Obligation Revenue Bonds, Sub-Series A, 5.24%, 10/01/37 (c)(n) 3,670 518,865 Orlando, Florida, Senior Tourist Development Tax Revenue Bonds (6th Cent Contract Payments), Series A, 5.25%, 11/01/38 (m) 4,000 3,625,960 Pasco County, Florida, Half-Cent Sales Tax Revenue Bonds, 5.125%, 12/01/28 (a) 6,300 5,560,758 BlackRock MuniHoldings Insured Fund II, Inc. Schedule of Investments October 31, 2008 (Unaudited) (Percentages shown are based on Net Assets) Par State Municipal Bonds (000) Value ----------------------------------------------------------------------------------------------------------------------------------- Saint Johns County, Florida, Water and Sewer Revenue Bonds, CABS, 5.352%, 6/01/31 (a)(n) $ 5,065 $ 1,189,362 Seminole County, Florida, Water and Sewer Revenue Bonds, 5%, 10/01/31 6,250 5,731,250 -------------- 81,078,718 ----------------------------------------------------------------------------------------------------------------------------------- Idaho - 0.2% Idaho Housing and Finance Association, S/F Mortgage Revenue Bonds, AMT, Series E, 6%, 1/01/32 360 360,108 ----------------------------------------------------------------------------------------------------------------------------------- Illinois - 3.2% Chicago, Illinois, O'Hare International Airport, General Airport Revenue Refunding Bonds, Third Lien, AMT, Series A, 5.75%, 1/01/19 (c) 3,125 2,928,000 Chicago, Illinois, O'Hare International Airport, General Airport Revenue Refunding Bonds, Third Lien, Series A, 5%, 1/01/31 (c) 1,430 1,236,964 Illinois State Finance Authority, Revenue Refunding Bonds (Central DuPage Health System), VRDN, Series B, 1.25%, 11/01/38 (f)(g) 3,500 3,500,000 Lake, Cook, Kane and McHenry Counties, Illinois, Community Unit School District Number 220, GO, 6%, 12/01/20 (h) 125 130,429 -------------- 7,795,393 ----------------------------------------------------------------------------------------------------------------------------------- Indiana - 5.4% Indiana Municipal Power Agency, Power Supply System Revenue Bonds, Series A, 5%, 1/01/37 (c) 8,000 6,672,800 Indiana Municipal Power Agency, Power Supply System Revenue Bonds, Series A, 5%, 1/01/42 (c) 8,000 6,489,120 -------------- 13,161,920 ----------------------------------------------------------------------------------------------------------------------------------- Kansas - 2.5% Kansas State Development Finance Authority, Health Facilities Revenue Bonds (Sisters of Charity Leavenworth), Series J, 6.125%, 12/01/20 3,510 3,527,620 Sedgwick and Shawnee Counties, Kansas, S/F Mortgage Revenue Bonds, AMT, Series A-2, 6.20%, 12/01/33 (j)(l) 2,615 2,635,005 -------------- 6,162,625 ----------------------------------------------------------------------------------------------------------------------------------- Kentucky - 0.4% Kentucky Economic Development Financing Authority, Louisville Arena Project Revenue Bonds (Louisville Arena Authority, Inc.), Sub-Series A-1, 6%, 12/01/38 (m) 1,150 1,085,933 ----------------------------------------------------------------------------------------------------------------------------------- Louisiana - 3.1% Louisiana Public Facilities Authority Revenue Bonds (CHRISTUS Health Project), VRDN, Series C, 9.90%, 7/01/47 (c)(f)(g) 6,250 6,250,000 Louisiana State Gas and Fuels Tax Revenue Bonds, Series A, 5%, 5/01/41 (c)(h) 1,600 1,386,640 -------------- 7,636,640 ----------------------------------------------------------------------------------------------------------------------------------- Michigan - 4.1% Michigan State Hospital Finance Authority, Revenue Refunding Bonds (Mercy-Mount Clemens), Series A, 6%, 5/15/09 (b)(c) 1,000 1,029,510 Michigan State Strategic Fund, Limited Obligation Revenue Refunding Bonds (Detroit Edison Company Pollution Control Project), AMT, Series A, 5.50%, 6/01/30 (o) 2,000 1,639,640 Michigan State Strategic Fund, Limited Obligation Revenue Refunding Bonds (Detroit Edison Company Pollution Control Project), AMT, Series C, 5.65%, 9/01/29 (o) 5,000 4,250,650 Saint Clair County, Michigan, Economic Revenue Refunding Bonds (Detroit Edison Co. Project), Series AA, 6.40%, 8/01/24 (a) 3,000 3,065,520 -------------- 9,985,320 ----------------------------------------------------------------------------------------------------------------------------------- BlackRock MuniHoldings Insured Fund II, Inc. Schedule of Investments October 31, 2008 (Unaudited) (Percentages shown are based on Net Assets) Par State Municipal Bonds (000) Value ----------------------------------------------------------------------------------------------------------------------------------- Minnesota - 5.5% Prior Lake, Minnesota, Independent School District Number 719, GO, 5.50%, 2/01/16 (e) $ 2,555 $ 2,646,188 Prior Lake, Minnesota, Independent School District Number 719, GO, 5.50%, 2/01/17 (e) 1,830 1,895,313 Prior Lake, Minnesota, Independent School District Number 719, GO, 5.50%, 2/01/18 (e) 3,570 3,697,413 Prior Lake, Minnesota, Independent School District Number 719, GO, 5.50%, 2/01/19 (e) 2,840 2,941,360 Sauk Rapids, Minnesota, Independent School District Number 47, GO, Series A, 5.625%, 2/01/18 (c) 2,185 2,306,683 -------------- 13,486,957 ----------------------------------------------------------------------------------------------------------------------------------- Nevada - 4.7% Clark County, Nevada, Airport Revenue Bonds (Jet Aviation Fuel Tax), AMT, Series C, 5.375%, 7/01/20 (a) 1,200 1,069,896 Clark County, Nevada, Water Reclamation District, Limited Tax, GO, 6%, 7/01/38 10,000 10,182,500 Nevada Housing Division, S/F Mortgage Revenue Bonds, AMT, Series A-2, 6.30%, 4/01/22 (c) 95 95,753 -------------- 11,348,149 ----------------------------------------------------------------------------------------------------------------------------------- New Jersey - 5.4% New Jersey EDA, Motor Vehicle Surcharge Revenue Bonds, Series A, 5.25%, 7/01/33 (c) 11,000 10,306,340 New Jersey State Turnpike Authority, Turnpike Revenue Bonds, Series C, 5%, 1/01/30 (e) 3,000 2,860,410 -------------- 13,166,750 ----------------------------------------------------------------------------------------------------------------------------------- New York - 6.1% Nassau Health Care Corporation, New York, Health System Revenue Bonds, 5.75%, 8/01/09 (b)(e) 12,300 12,871,212 Tobacco Settlement Financing Corporation of New York Revenue Bonds, Series A-1, 5.25%, 6/01/21 (a) 2,000 1,919,840 -------------- 14,791,052 ----------------------------------------------------------------------------------------------------------------------------------- North Carolina - 0.4% North Carolina HFA, Home Ownership Revenue Bonds, AMT, Series 14-A, 5.35%, 1/01/22 (a) 1,235 1,096,668 ----------------------------------------------------------------------------------------------------------------------------------- Ohio - 1.2% Aurora, Ohio, City School District, COP, 6.10%, 12/01/09 (b)(c) 1,745 1,844,238 Kent State University, Ohio, University Revenue Bonds, 6%, 5/01/24 (a) 1,000 1,016,170 -------------- 2,860,408 ----------------------------------------------------------------------------------------------------------------------------------- Oklahoma - 1.1% Claremore, Oklahoma, Public Works Authority, Capital Improvement Revenue Refunding Bonds, Series A, 5.25%, 6/01/14 (b)(e) 2,385 2,611,170 ----------------------------------------------------------------------------------------------------------------------------------- Pennsylvania - 0.1% Washington County, Pennsylvania, Capital Funding Authority Revenue Bonds (Capital Projects and Equipment Program), 6.15%, 12/01/29 (a) 305 260,275 ----------------------------------------------------------------------------------------------------------------------------------- Rhode Island - 4.1% Providence, Rhode Island, Redevelopment Agency Revenue Refunding Bonds (Public Safety and Municipal Buildings), Series A, 5.75%, 4/01/10 (a)(b) 5,555 5,876,690 Rhode Island State Health and Educational Building Corporation Revenue Bonds (Rhode Island School of Design), Series D, 5.50%, 8/15/31 (o) 4,685 4,213,455 -------------- 10,090,145 ----------------------------------------------------------------------------------------------------------------------------------- South Carolina - 6.0% South Carolina Housing Finance and Development Authority, Mortgage Revenue Refunding Bonds, AMT, Series A-2, 6.35%, 7/01/19 (e) 1,335 1,345,373 South Carolina State Public Service Authority, Revenue Refunding Bonds, Series A, 5%, 1/01/42 (a) 15,000 13,161,000 -------------- 14,506,373 ----------------------------------------------------------------------------------------------------------------------------------- BlackRock MuniHoldings Insured Fund II, Inc. Schedule of Investments October 31, 2008 (Unaudited) (Percentages shown are based on Net Assets) Par State Municipal Bonds (000) Value ----------------------------------------------------------------------------------------------------------------------------------- Tennessee - 1.5% Metropolitan Government of Nashville and Davidson County, Tennessee, Health and Education Facilities Board, Revenue Refunding Bonds (Ascension Health Credit), Series A, 5.875%, 11/15/09 (a)(b) $ 3,500 $ 3,681,965 ----------------------------------------------------------------------------------------------------------------------------------- Texas - 15.8% Dallas-Fort Worth, Texas, International Airport, Joint Revenue Bonds, AMT, Series B, 6%, 11/01/23 (c) 1,300 1,181,570 Dallas-Fort Worth, Texas, International Airport Revenue Refunding and Improvement Bonds, AMT, Series A, 5.875%, 11/01/17 (c)(h) 1,835 1,756,334 Dallas-Fort Worth, Texas, International Airport Revenue Refunding and Improvement Bonds, AMT, Series A, 5.875%, 11/01/18 (c)(h) 2,150 2,029,407 Dallas-Fort Worth, Texas, International Airport Revenue Refunding and Improvement Bonds, AMT, Series A, 5.875%, 11/01/19 (c)(h) 2,390 2,227,169 El Paso, Texas, Water and Sewer Revenue Refunding and Improvement Bonds, Series A, 6%, 3/01/15 (e) 115 123,049 El Paso, Texas, Water and Sewer Revenue Refunding and Improvement Bonds, Series A, 6%, 3/01/16 (e) 170 181,898 El Paso, Texas, Water and Sewer Revenue Refunding and Improvement Bonds, Series A, 6%, 3/01/17 (e) 180 192,598 Katy, Texas, Independent School District, GO, Series C, 5%, 2/15/38 6,300 5,792,283 North Texas Tollway Authority, System Revenue Refunding Bonds, First Tier, 5.75%, 1/01/40 (c) 14,750 13,684,902 North Texas Tollway Authority, System Revenue Refunding Bonds, First Tier, Series B, 5.75%, 1/01/40 (c) 1,000 927,790 North Texas Tollway Authority, System Revenue Refunding Bonds, Series A, 5.625%, 1/01/33 (c) 10,975 10,345,803 -------------- 38,442,803 ----------------------------------------------------------------------------------------------------------------------------------- Washington - 2.7% Chelan County, Washington, Public Utility District Number 001, Consolidated Revenue Bonds (Chelan Hydro System), AMT, Series A, 5.45%, 7/01/37 (a) 3,840 2,992,550 Lewis County, Washington, GO, Refunding, 5.75%, 12/01/09 (a)(b) 1,805 1,883,716 Lewis County, Washington, GO, Refunding, 5.75%, 12/01/24 (a) 1,640 1,672,866 -------------- 6,549,132 ----------------------------------------------------------------------------------------------------------------------------------- Wisconsin - 0.4% Wisconsin State Health and Educational Facilities Authority Revenue Bonds (Blood Center of Southeastern Wisconsin Project), 5.75%, 6/01/34 1,250 1,053,413 ----------------------------------------------------------------------------------------------------------------------------------- Puerto Rico - 2.1% Puerto Rico Commonwealth, Public Improvement, GO, 5.125%, 7/01/30 (e) 5,725 5,140,707 ----------------------------------------------------------------------------------------------------------------------------------- Total Municipal Bonds - 141.6% 345,377,397 ----------------------------------------------------------------------------------------------------------------------------------- Municipal Bonds Transferred to Tender Option Bond Trusts (p) ----------------------------------------------------------------------------------------------------------------------------------- California - 9.1% Palomar Pomerado Health Care District, California, GO (Election of 2004), Series A, 5.125%, 8/01/37 (c) 7,360 6,862,611 San Jose, California, GO (Libraries, Parks and Public Safety Projects), 5%, 9/01/30 (c) 3,805 3,560,051 Sequoia, California, Unified High School District, GO, Refunding, Series B, 5.50%, 7/01/35 (e) 5,189 5,138,414 Tustin, California, Unified School District, Senior Lien Special Tax Bonds (Community Facilities District Number 97-1), Series A, 5%, 9/01/32 (e) 2,920 2,609,721 Tustin, California, Unified School District, Senior Lien Special Tax Bonds (Community Facilities District Number 97-1), Series A, 5%, 9/01/38 (e) 4,620 4,039,220 -------------- 22,210,017 ----------------------------------------------------------------------------------------------------------------------------------- BlackRock MuniHoldings Insured Fund II, Inc. Schedule of Investments October 31, 2008 (Unaudited) (Percentages shown are based on Net Assets) Municipal Bonds Transferred to Par State Tender Option Bond Trusts (p) (000) Value ----------------------------------------------------------------------------------------------------------------------------------- Colorado - 3.4% Colorado Health Facilities Authority Revenue Bonds (Catholic Health), Series C-3, 5.10%, 10/01/41 (e) $ 9,410 $ 8,309,406 ----------------------------------------------------------------------------------------------------------------------------------- Florida - 4.1% Lee County, Florida, HFA, S/F Mortgage Revenue Bonds (Multi-County Program), AMT, Series A-2, 6%, 9/01/40 (j)(k)(l) 4,500 4,348,575 Saint Petersburg, Florida, Public Utilities Revenue Refunding Bonds, 5%, 10/01/35 (c) 6,493 5,822,069 -------------- 10,170,644 ----------------------------------------------------------------------------------------------------------------------------------- Georgia - 2.5% Augusta, Georgia, Water and Sewer Revenue Bonds, 5.25%, 10/01/34 (e) 6,290 6,167,471 ----------------------------------------------------------------------------------------------------------------------------------- Illinois - 6.9% Chicago, Illinois, O'Hare International Airport, General Airport Revenue Refunding Bonds, Third Lien, AMT, Series A, 5%, 1/01/38 (e) 15,000 13,155,225 Chicago, Illinois, Water Revenue Refunding Bonds, Second Lien, 5.25%, 11/01/33 (e) 3,969 3,652,994 -------------- 16,808,219 ----------------------------------------------------------------------------------------------------------------------------------- Massachusetts - 4.0% Massachusetts Bay Transportation Authority, Sales Tax Revenue Refunding Bonds, Senior Series A, 5%, 7/01/35 5,535 4,999,710 Massachusetts State School Building Authority, Dedicated Sales Tax Revenue Bonds, Series A, 5%, 8/15/30 (e) 4,994 4,733,354 -------------- 9,733,064 ----------------------------------------------------------------------------------------------------------------------------------- New York - 2.8% New York City, New York, Sales Tax Asset Receivable Corporation Revenue Bonds, Series A, 5.25%, 10/15/27 (a) 6,750 6,770,317 ----------------------------------------------------------------------------------------------------------------------------------- Washington - 2.8% Bellevue, Washington, GO, Refunding, 5.50%, 12/01/39 (c) 6,883 6,753,198 ----------------------------------------------------------------------------------------------------------------------------------- Total Municipal Bonds Transferred to Tender Option Bond Trusts - 35.6% 86,922,336 ----------------------------------------------------------------------------------------------------------------------------------- Total Long-Term Investments (Cost - $478,500,290) - 177.2% 432,299,733 ----------------------------------------------------------------------------------------------------------------------------------- Short-Term Securities Shares ----------------------------------------------------------------------------------------------------------------------------------- Merrill Lynch Institutional Tax-Exempt Fund, 1.63% (q)(r) 6,289,380 6,289,380 ----------------------------------------------------------------------------------------------------------------------------------- Total Short-Term Securities (Cost - $6,289,380) - 2.6% 6,289,380 ----------------------------------------------------------------------------------------------------------------------------------- Total Investments (Cost - $484,789,670*) - 179.8% 438,589,113 Other Assets Less Liabilities - 0.8% 2,054,100 Liability for Trust Certificates, Including Interest Expense and Fees Payable - (21.0)% (51,348,057) Preferred Shares, at Redemption Value - (59.6)% (145,374,948) -------------- Net Assets Applicable to Common Shares - 100.0% $ 243,920,208 ============== * The cost and unrealized appreciation (depreciation) of investments as of October 31, 2008, as computed for federal income tax purposes, were as follows: Aggregate cost $ 428,354,697 ============= Gross unrealized appreciation $ 4,713,843 Gross unrealized depreciation (45,342,669) ------------- Net unrealized depreciation $ (40,628,826) ============= (a) AMBAC Insured. (b) U.S. government securities, held in escrow, are used to pay interest on this security as well as to retire the bond in full at the date indicated, typically at a premium to par. (c) MBIA Insured. (d) FHA Insured. BlackRock MuniHoldings Insured Fund II, Inc. Schedule of Investments October 31, 2008 (Unaudited) (e) FSA Insured. (f) Variable rate security. Rate shown is as of report date. Maturity shown is the final maturity date. (g) Security may have a maturity of more than one year at the time of issuance, but has variable rate and demand features that qualify it as a short-term security. (h) FGIC Insured. (i) Radian Insured. (j) GNMA Collateralized. (k) FHLMC Collateralized. (l) FNMA Collateralized. (m) Assured Guaranty Insured. (n) Represents a zero-coupon bond. Rate shown reflects the effective yield at the time of purchase. (o) XL Capital Insured. (p) Securities represent bonds transferred to a tender option bond trust in exchange for which the Fund acquired residual interest certificates. These securities serve as collateral in a financing transaction. (q) Represents the current yield as of report date. (r) Investments in companies considered to be an affiliate of the Fund, for purposes of Section 2(a)(3) of the Investment Company Act of 1940, were as follows: -------------------------------------------------------------------------- Affiliate Net Activity Income -------------------------------------------------------------------------- Merrill Lynch Institutional Tax-Exempt Fund (18,529,084) $ 72,865 -------------------------------------------------------------------------- o Effective August 1, 2008, the Fund adopted Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, "Fair Value Measurements" ("FAS 157"). FAS 157 clarifies the definition of fair value, establishes a framework for measuring fair values and requires additional disclosures about the use of fair value measurements. Various inputs are used in determining the fair value of investments, which are as follows: o Level 1 - price quotations in active markets/exchanges for identical securities o Level 2 - other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks, and default rates) or other market-corroborated inputs) o Level 3 - unobservable inputs based on the best information available in the circumstance, to the extent observable inputs are not available (including the Fund's own assumption used in determining the fair value of investments) The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For information about the Fund's policy regarding valuation of investments and other significant accounting policies, please refer to the Fund's most recent financial statements as contained in its annual report. The following table summarizes the inputs used as of October 31, 2008 in determining the fair valuation of the Fund's investments: -------------------------------------------------------------------------- Valuation Investments in Inputs Securities -------------------------------------------------------------------------- Level 1 $ 6,289,380 Level 2 432,299,733 Level 3 -- -------------------------------------------------------------------------- Total $ 438,589,113 ============== Item 2 - Controls and Procedures 2(a) - The registrant's principal executive and principal financial officers or persons performing similar functions have concluded that the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the "1940 Act")) are effective as of a date within 90 days of the filing of this report based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rule 13a-15(b) under the Securities Exchange Act of 1934, as amended. 2(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 reasonably likely to materially affect, the registrant's internal control over financial reporting. Item 3 - Exhibits Certifications - Attached hereto Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. BlackRock MuniHoldings Insured Fund II, Inc. By: /s/ Donald C. Burke -------------------------------- Donald C. Burke Chief Executive Officer of BlackRock MuniHoldings Insured Fund II, Inc. Date: December 19, 2008 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/ Donald C. Burke -------------------------------- Donald C. Burke Chief Executive Officer (principal executive officer) of BlackRock MuniHoldings Insured Fund II, Inc. Date: December 19, 2008 By: /s/ Neal J. Andrews -------------------------------- Neal J. Andrews Chief Financial Officer (principal financial officer) of BlackRock MuniHoldings Insured Fund II, Inc. Date: December 19, 2008