Edgar Filing: TEMPLETON EMERGING MARKETS FUND

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-CSR/A

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number 811-04985
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TEMPLETON EMERGING MARKETS FUND
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(Exact name of registrant as specified in charter)

500 EAST BROWARD BLVD., SUITE 2100, FORT LAUDERDALE, FL 33394-3091
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(Address of principal executive offices) (Zip code)

CRAIG S. TYLE, ONE FRANKLIN PARKWAY, SAN MATEO, CA 94403-1906
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(Name and address of agent for service)

Registrant's telephone number, including area code: (954) 527-7500
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Date of fiscal year end: 8/31
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Date of reporting period: 8/31/07
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ITEM 1. REPORTS TO STOCKHOLDERS.

[GRAPHIC OMITTED]

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AUGUST 31, 2007
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ANNUAL REPORT INTERNATIONAL
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TEMPLETON
EMERGING MARKETS FUND

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[LOGO](R)
FRANKLIN TEMPLETON
INVESTMENTS

Franklin o TEMPLETON o Mutual Series

FRANKLIN TEMPLETON INVESTMENTS

GAIN FROM OUR PERSPECTIVE(R)

Franklin Templeton's distinct multi-manager
structure combines the specialized expertise of
three world-class investment management groups--
Franklin, Templeton and Mutual Series.

SPECIALIZED EXPERTISE Each of our portfolio management groups operates
autonomously, relying on its own research and
staying true to the unique investment disciplines
that underlie its success.

FRANKLIN. Founded in 1947, Franklin is a recognized
leader in fixed income investing and also brings
expertise in growth- and value-style U.S. equity
investing.

TEMPLETON. Founded in 1940, Templeton pioneered
international investing and, in 1954, launched what
has become the industry's oldest global fund. Today,
with offices in over 25 countries, Templeton offers
investors a truly global perspective.

MUTUAL SERIES. Founded in 1949, Mutual Series is
dedicated to a unique style of value investing,
searching aggressively for opportunity among what it
believes are undervalued stocks, as well as
arbitrage situations and distressed securities.

TRUE DIVERSIFICATION Because our management groups work independently and
adhere to different investment approaches, Franklin,
Templeton and Mutual Series funds typically have
distinct portfolios. That's why our funds can be
used to build truly diversified allocation plans
covering every major asset class.

RELIABILITY YOU CAN TRUST At Franklin Templeton Investments, we seek to
consistently provide investors with exceptional
risk-adjusted returns over the long term, as well as
the reliable, accurate and personal service that has
helped us become one of the most trusted names in
financial services.

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MUTUAL FUNDS | RETIREMENT PLANS | 529 COLLEGE SAVINGS PLANS | SEPARATE ACCOUNTS
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[GRAPHIC OMITTED]

Not part of the annual report

Contents

ANNUAL REPORT

Templeton Emerging Markets Fund ........................................... 1

Performance Summary ....................................................... 6

Important Notice to Shareholders .......................................... 7

Financial Highlights and Statement of Investments ......................... 8

Financial Statements ...................................................... 13

Notes to Financial Statements ............................................. 16

Report of Independent Registered Public Accounting Firm ................... 23

Tax Designation ........................................................... 24

Annual Meeting of Shareholders ............................................ 26

Dividend Reinvestment and Cash Purchase Plan .............................. 27

Board Members and Officers ................................................ 29

Shareholder Information ................................................... 34

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ANNUAL REPORT

TEMPLETON EMERGING MARKETS FUND

YOUR FUND'S GOAL AND MAIN INVESTMENTS: Templeton Emerging Markets Fund seeks
long-term capital appreciation by investing, under normal market conditions, at
least 80% of its net assets in emerging country equity securities.

GEOGRAPHIC BREAKDOWN
Based on Total Net Assets as of 8/31/07

[THE FOLLOWING TABLE WAS REPRESENTED BY A BAR CHART IN THE PRINTED MATERIAL.]

Asia 49.8%
Europe 27.8%
Latin America 18.0%
Middle East & Africa 4.1%
Short-Term Investments & Other Net Assets 0.3%

Dear Shareholder:

This annual report for Templeton Emerging Markets Fund covers the fiscal year
ended August 31, 2007.

PERFORMANCE OVERVIEW

Templeton Emerging Markets Fund delivered cumulative total returns of +41.62%
based on market price and +47.12% based on net asset value for the 12 months
under review.

ECONOMIC AND MARKET OVERVIEW

Emerging markets performed well for the 12 months under review. Early in the
period, emerging markets maintained an upward trend. After some minor
profit-taking at the beginning of 2007, a 9% drop in China's domestic Shanghai A
and Shenzhen A share markets at the end of February and worries about the
possibly overheated Chinese economy triggered widespread

THE DOLLAR VALUE, NUMBER OF SHARES OR PRINCIPAL AMOUNT, AND NAMES OF ALL
PORTFOLIO HOLDINGS ARE LISTED IN THE FUND'S STATEMENT OF INVESTMENTS (SOI). THE
SOI BEGINS ON PAGE 9.

Annual Report | 1

TOP 10 COUNTRIES
Based on Equity Investments as of 8/31/07

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% OF TOTAL
NET ASSETS
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China 16.9%
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Brazil 15.2%
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South Korea 9.2%
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Turkey 8.8%
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Russia 8.7%
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Thailand 7.8%
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India 5.3%
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Taiwan 4.8%
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Hungary 4.7%
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South Africa 4.1%
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selling across the globe. 1 (The Fund cannot invest in Shanghai A and Shenzhen A
share markets.) The correction, however, was short-lived, and investors returned
to the markets in March. With abundant market liquidity, stock prices resumed
their previous upward trend for most of the second half of the Fund's fiscal
year. A brief period of uncertainty occurred in August as a result of widespread
concerns over financial corporations' exposure to U.S. subprime mortgages. The
possibility of tightening liquidity around the world contributed to significant
selling in global stock and bond markets. Although emerging market companies
generally had little exposure to U.S. subprime loans, they were not immune to
the global sell-off.

A decision by the U.S. Federal Reserve Board (Fed) in August to cut the discount
rate -- the rate at which the U.S. Fed lends money to banks -- by 50 basis
points, from 6.25% to 5.75%, eventually calmed markets. This availability of
funds to American companies alleviated the immediate credit crunch and helped
many global markets to rebound. Largely as a result, liquidity improved and
markets appreciated almost as rapidly as they corrected.

Regionally, Latin American markets were among the top performers as net fund
inflows continued and major regional currencies strengthened against the U.S.
dollar during the period. In Asia, China and India outperformed their emerging
market counterparts despite concerns about their economies overheating. The
China H and Red Chip markets, composed of Chinese companies listed in Hong Kong.
were largely driven by the Chinese government's plan to allow domestic investors
to invest in those markets directly. 2 Prices of these Hong Kong-listed shares
increased amid expectations of significant fund inflows from mainland China.

Key emerging European markets such as Turkey, Poland and Hungary recorded robust
performances, while Russia underperformed its peers and ended years of
double-digit returns during the reporting period. Negative international press,
an unsuccessful Russia-European Union summit and greater friction with the U.S.
led investors to stay on the sidelines. Despite a gain of about 30% during the
reporting period, South Africa's equity market lagged its peers as a result of
higher interest rates. 3

1. "Shanghai A" and "Shenzhen A" denote shares of companies listed in China's
Shanghai and Shenzhen markets that are reserved for domestic investors and
certain qualified foreign institutional investors.

2. "China H" denotes shares of China-incorporated, Hong Kong-listed companies
with most businesses in China. "Red Chip" denotes shares of Hong Kong-listed
companies with significant exposure to China. China H and Red Chip shares are
traded on the Hong Kong Stock Exchange.

3. Source: Standard & Poor's Micropal.

2 | Annual Report

INVESTMENT STRATEGY

Our investment strategy employs a bottom-up, value-oriented, long-term approach.
We focus on the market price of a company's securities relative to our
evaluation of the company's long-term earnings, asset value and cash flow
potential. As we look for investments, we focus on specific companies and
undertake in-depth research to construct an action list from which we make our
buy decisions. Before we make a purchase, we look at the company's potential for
earnings and growth over a five-year horizon. During our analysis, we also
consider the company's position in its sector, the economic framework and
political environment.

MANAGER'S DISCUSSION

During the 12 months under review, sectors that contributed significantly to
Fund performance were materials, energy, banks and telecommunication services. 4
In the materials sector, Fund holdings Chalco (Aluminum Corp. of China) and
Brazil's CVRD (Companhia Vale do Rio Doce) helped performance, while in the
energy sector, PetroChina and Brazil's Petrobras (Petroleo Brasileiro) were
among the largest contributors to performance. Higher commodity prices and
greater demand for oil, coal and metals in rapidly growing economies such as
China, India and other emerging markets benefited these companies.

Banks that experienced significant price appreciation during the reporting
period included Akbank (Turkey), Banco Bradesco (Brazil) and Unibanco - Uniao de
Bancos Brasileiros (Brazil). Telecommunication holdings Maxis Communications
(Malaysia), Turkcell Iletisim Hizmetleri (Turkey) and Mobile TeleSystems
(Russia) also performed well. We took advantage of a generous tender offer and
sold the Fund's position in Maxis during the reporting period.

From a geographic perspective, investments in China, Brazil and Turkey
contributed significantly to performance during the Fund's fiscal year. In
addition to stocks discussed earlier, Sinopec (China Petroleum and Chemical),
the country's largest refiner and petrochemical producer; Tupras-Turkiye Petrol
Rafinerileri, Turkey's largest oil refiner; and Arcelik, Turkey's largest
household appliances manufacturer, also boosted Fund returns.

4. The materials sector comprises construction materials, and metals and mining
in the SOI. The energy sector comprises energy equipment and services; and oil,
gas and consumable fuels in the SOI. The banks sector comprises commercial banks
in the SOI. The telecommunication services sector comprises diversified
telecommunication services and wireless telecommunication services in the SOI.

Annual Report | 3

TOP 10 HOLDINGS
8/31/07
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COMPANY % OF TOTAL
SECTOR/INDUSTRY, COUNTRY NET ASSETS
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Chalco (Aluminum Corp. of China Ltd.), H 6.4%
METALS & MINING, CHINA
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CVRD (Companhia Vale do Rio Doce),
ADR, pfd., A 4.8%
METALS & MINING, BRAZIL
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Petrobras (Petroleo Brasileiro) SA,
ADR, pfd. 4.3%
OIL, GAS & CONSUMABLE FUELS, BRAZIL
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Akbank TAS 4.2%
COMMERCIAL BANKS, TURKEY
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PetroChina Co. Ltd., H & 144A 4.1%
OIL, GAS & CONSUMABLE FUELS, CHINA
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SK Energy Co. Ltd. 2.6%
OIL, GAS & CONSUMABLE FUELS,
SOUTH KOREA
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Banco Bradesco SA, ADR, pfd. 2.5%
COMMERCIAL BANKS, BRAZIL
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LUKOIL, ADR 2.4%
OIL, GAS & CONSUMABLE FUELS, RUSSIA
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Remgro Ltd. 2.4%
DIVERSIFIED FINANCIAL SERVICES,
SOUTH AFRICA
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Norilsk Nickel (Mining and
Metallurgical Co. Norilsk Nickel) 2.4%
METALS & MINING, RUSSIA
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It is important to recognize the effect of currency movements on the Fund's
performance. In general, if the value of the U.S. dollar goes up compared with a
foreign currency, an investment traded in that foreign currency will go down in
value because it will be worth fewer U.S. dollars. This can have a negative
effect on Fund performance. Conversely, when the U.S. dollar weakens in relation
to a foreign currency, an investment traded in that foreign currency will
increase in value, which can contribute to Fund performance. For the 12 months
ended August 31, 2007, the U.S. dollar declined in value relative to most
non-U.S. currencies. As a result, the Fund's performance was positively affected
by the portfolio's investment predominantly in securities with non-U.S. currency
exposure. However, one cannot expect the same result in future periods.

Only one sector, pharmaceuticals, had a negative impact on Fund returns, and
detractors included Croatia's Pliva and Hungary's Richter Gedeon. The Fund
realized gains on its Pliva holding early in the reporting period after the
company was the target of a takeover battle that led to share price appreciation
exceeding our sell limit. We took advantage of a price correction in Richter
Gedeon to add to our existing position because we remained confident in the
company's fundamentals and expected it to benefit from merger and acquisition
activity in the pharmaceuticals industry.

To raise funds for the income and capital gains distribution in November 2006,
we sold a number of holdings. These sales also allowed us to focus on stocks we
considered relatively more attractively valued within our investment universe.
We sold select positions in Malaysia, Taiwan, South Africa and South Korea as
stocks reached sale price targets. As a result, the Fund's exposure to the
industrial conglomerates, wireless telecommunication services, and
semiconductors and semiconductor equipment industries fell.

With commodity prices expected to stay at relatively high levels, we increased
our investments in aluminum companies and the oil, gas and consumable fuels
industry. 5 Coupled with growing global energy demand, we believed companies in
the energy sector and metals and mining industry could experience higher
corporate earnings and subsequently higher equity prices. Purchases included
Lotos (Grupa Lotos) and PKN Orlen (Polski Koncern Naftowy Orlen), which are
Poland's leading companies in the refining and marketing of oil products and
petrochemicals; Austria's OMV, a major oil and gas company in Central and
Eastern Europe; and SK Energy, a South Korean oil refiner.

5. Aluminum companies are in the metals and mining industry in the SOI.

4 | Annual Report

We also made purchases in Pakistan, India and Thailand as we continued to search
for what we believed were attractively valued stocks that could benefit from
developments in emerging markets. Additions included Faysal Bank, a Pakistani
bank with solid growth potential; Sesa Goa, one of India's dominant iron ore
exporters; and Kiatnakin Bank, a banking and finance company in Thailand. In
our analysis, the financial sector's continued liberalization in emerging
markets such as Pakistan and Thailand could unlock value and allow banks to
benefit from consumers' growing financial needs.

Thank you for your continued participation in Templeton Emerging Markets Fund.
We look forward to serving your future investment needs.

Sincerely,

[PHOTO OMITTED]

/s/ Mark Mobius
Mark Mobius
Executive Chairman
Templeton Asset Management Limited

THE FOREGOING INFORMATION REFLECTS OUR ANALYSIS, OPINIONS AND PORTFOLIO HOLDINGS
AS OF AUGUST 31, 2007, THE END OF THE REPORTING PERIOD. THE WAY WE IMPLEMENT OUR
MAIN INVESTMENT STRATEGIES AND THE RESULTING PORTFOLIO HOLDINGS MAY CHANGE
DEPENDING ON FACTORS SUCH AS MARKET AND ECONOMIC CONDITIONS. THESE OPINIONS MAY
NOT BE RELIED UPON AS INVESTMENT ADVICE OR AN OFFER FOR A PARTICULAR SECURITY.
THE INFORMATION IS NOT A COMPLETE ANALYSIS OF EVERY ASPECT OF ANY MARKET,
COUNTRY, INDUSTRY, SECURITY OR THE FUND. STATEMENTS OF FACT ARE FROM SOURCES
CONSIDERED RELIABLE, BUT THE INVESTMENT MANAGER MAKES NO REPRESENTATION OR
WARRANTY AS TO THEIR COMPLETENESS OR ACCURACY. ALTHOUGH HISTORICAL PERFORMANCE
IS NO GUARANTEE OF FUTURE RESULTS, THESE INSIGHTS MAY HELP YOU UNDERSTAND OUR
INVESTMENT MANAGEMENT PHILOSOPHY.

Annual Report | 5

Performance Summary as of 8/31/07

Your dividend income will vary depending on dividends or interest paid by
securities in the Fund's portfolio, adjusted for operating expenses. Capital
gain distributions are net profits realized from the sale of portfolio
securities. Total return reflects reinvestment of the Fund's dividends and
capital gain distributions, if any, and any unrealized gains or losses. Total
returns do not reflect any sales charges paid at inception or brokerage
commissions paid on secondary market purchases. The performance table does not
reflect any taxes that a shareholder would pay on Fund dividends, capital gain
distributions, if any, or realized gains on the sale of Fund shares.

PRICE AND DISTRIBUTION INFORMATION

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SYMBOL: EMF CHANGE 8/31/07 8/31/06
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Net Asset Value (NAV) +$2.58 $23.14 $20.56
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Market Price (NYSE) +$1.62 $20.56 $18.94
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DISTRIBUTIONS (9/1/06-8/31/07)
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Dividend Income $0.6365
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Short-Term Capital Gain $0.5162
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Long-Term Capital Gain $4.0999
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TOTAL $5.2526
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PERFORMANCE

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1-YEAR 5-YEAR 10-YEAR
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Cumulative Total Return 1
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Based on change in NAV 2 +47.12% +306.89% +210.65%
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Based on change in market price 3 +41.62% +293.60% +147.99%
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Average Annual Total Return 1
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Based on change in NAV 2 +47.12% +32.41% +12.00%
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Based on change in market price 3 +41.62% +31.53% +9.51%
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PERFORMANCE DATA REPRESENT PAST PERFORMANCE, WHICH DOES NOT GUARANTEE FUTURE
RESULTS. INVESTMENT RETURN AND PRINCIPAL VALUE WILL FLUCTUATE, AND YOU MAY HAVE
A GAIN OR LOSS WHEN YOU SELL YOUR SHARES. CURRENT PERFORMANCE MAY DIFFER FROM
FIGURES SHOWN.

ENDNOTES

SPECIAL RISKS ARE ASSOCIATED WITH FOREIGN INVESTING, INCLUDING CURRENCY
VOLATILITY, ECONOMIC INSTABILITY AND POLITICAL DEVELOPMENTS OF COUNTRIES WHERE
THE FUND INVESTS. EMERGING MARKETS INVOLVE HEIGHTENED RISKS RELATED TO THE SAME
FACTORS, IN ADDITION TO THOSE ASSOCIATED WITH THEIR RELATIVELY SMALL SIZE AND
LESSER LIQUIDITY.

1. Total return calculations represent the cumulative and average annual changes
in value of an investment over the periods indicated.

2. Assumes reinvestment of distributions based on net asset value.

3. Assumes reinvestment of distributions based on the dividend reinvestment and
cash purchase plan.

6 | Annual Report

Important Notice to Shareholders

SHARE REPURCHASE PROGRAM

The Fund's Board previously authorized management to implement an open-market
share repurchase program pursuant to which the Fund may purchase Fund shares,
from time to time, in open-market transactions, at the discretion of management.
This authorization remains in effect.

Annual Report | 7

Templeton Emerging Markets Fund

FINANCIAL HIGHLIGHTS

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YEAR ENDED AUGUST 31,
2007 2006 2005 2004 2003
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PER SHARE OPERATING PERFORMANCE
(for a share outstanding throughout the year)
Net asset value, beginning of year ................ $ 20.56 $ 17.98 $ 13.40 $ 10.82 $ 8.76
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Income from investment operations:
Net investment income a ........................ 0.37 0.33 0.32 0.22 0.18
Net realized and unrealized gains (losses) ..... 7.47 4.25 4.51 2.59 2.03
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Total from investment operations .................. 7.84 4.58 4.83 2.81 2.21
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Less distributions from:
Net investment income .......................... (0.64) (0.39) (0.25) (0.23) (0.15)
Net realized gains ............................. (4.62) (1.61) -- -- --
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Total distributions ............................... (5.26) (2.00) (0.25) (0.23) (0.15)
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Net asset value, end of year ...................... $ 23.14 $ 20.56 $ 17.98 $ 13.40 $ 10.82
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Market value, end of year b ....................... $ 20.56 $ 18.94 $ 18.31 $ 14.24 $ 11.84
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Total return (based on market value per share) .... 41.62% 15.01% 30.66% 22.62% 50.83%

RATIOS TO AVERAGE NET ASSETS
Expenses .......................................... 1.55% c 1.58% c 1.57% c 1.63% c 1.84%
Net investment income ............................. 1.86% 1.66% 2.00% 1.70% 1.94%

SUPPLEMENTAL DATA
Net assets, end of year (000's) ................... $418,213 $366,549 $318,240 $236,848 $191,076
Portfolio turnover rate ........................... 33.15% 43.03% 36.04% 67.63% 48.69%

a Based on average daily shares outstanding.

b Based on the last sale on the New York Stock Exchange.

c Benefit of expense reduction rounds to less than 0.01%.

8 | The accompanying notes are an integral part of these financial statements.
| Annual Report

Templeton Emerging Markets Fund

STATEMENT OF INVESTMENTS, AUGUST 31, 2007

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INDUSTRY SHARES/RIGHTS VALUE
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LONG TERM INVESTMENTS 99.7%
COMMON STOCKS AND RIGHTS 86.6%
AUSTRIA 1.3%
OMV AG ........................................... Oil, Gas & Consumable Fuels 89,020 $ 5,524,343
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BRAZIL 2.1%
Centrais Eletricas Brasileiras SA ................ Electric Utilities 317,988 4,115,043
Souza Cruz SA .................................... Tobacco 229,973 4,804,584
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8,919,627
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CHINA 16.9%
Aluminum Corp. of China Ltd., H .................. Metals & Mining 9,792,000 26,810,539
China Petroleum and Chemical Corp., H ............ Oil, Gas & Consumable Fuels 7,874,000 8,583,227
Chiwan Wharf Holdings Ltd., B .................... Transportation Infrastructure 991,000 2,554,500
CNOOC Ltd. ....................................... Oil, Gas & Consumable Fuels 6,512,000 7,958,726
Denway Motors Ltd. ............................... Automobiles 16,432,730 7,691,992
PetroChina Co. Ltd., H ........................... Oil, Gas & Consumable Fuels 9,832,000 14,374,177
a PetroChina Co. Ltd., H, 144A ..................... Oil, Gas & Consumable Fuels 1,856,000 2,713,433
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70,686,594
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HONG KONG 1.8%
Dairy Farm International Holdings Ltd. ........... Food & Staples Retailing 1,595,100 6,890,832
Tack Fat Group International Ltd. ................ Textiles, Apparel & Luxury Goods 5,192,000 832,302
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7,723,134
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HUNGARY 4.7%
Magyar Telekom PLC ............................... Diversified Telecommunication Services 616,974 3,096,755
MOL Hungarian Oil and Gas Nyrt. .................. Oil, Gas & Consumable Fuels 56,975 8,170,645
Richter Gedeon Nyrt. ............................. Pharmaceuticals 41,694 8,254,912
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19,522,312
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INDIA 5.3%
Gail India Ltd. .................................. Gas Utilities 295,286 2,246,978
Hindalco Industries Ltd. ......................... Metals & Mining 791,800 3,076,408
National Aluminium Co. Ltd. ...................... Metals & Mining 613,230 3,910,398
Oil & Natural Gas Corp. Ltd. ..................... Oil, Gas & Consumable Fuels 250,395 5,283,618
a Oil & Natural Gas Corp. Ltd., 144A ............... Oil, Gas & Consumable Fuels 45,645 963,161
Sesa Goa Ltd. .................................... Metals & Mining 135,814 6,496,949
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21,977,512
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INDONESIA 1.6%
PT Astra International Tbk ....................... Automobiles 1,409,000 2,678,450
PT Bank Central Asia Tbk ......................... Commercial Banks 6,424,500 4,105,112
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6,783,562
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Annual Report | 9

Templeton Emerging Markets Fund

STATEMENT OF INVESTMENTS, AUGUST 31, 2007 (CONTINUED)

LONG TERM INVESTMENTS (CONTINUED)
COMMON STOCKS AND RIGHTS (CONTINUED)
MEXICO 2.8%
Kimberly Clark de Mexico SAB de CV, A ............ Household Products 1,572,800 $ 6,771,138
Telefonos de Mexico SAB de CV (Telmex),
L, ADR ........................................ Diversified Telecommunication Services 133,674 4,724,039
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11,495,177
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PAKISTAN 2.4%
Faysal Bank Ltd. ................................. Commercial Banks 4,166,000 5,105,426
MCB Bank Ltd. .................................... Commercial Banks 589,450 3,019,584
Pakistan Telecommunications Corp., A ............. Diversified Telecommunication Services 2,538,000 2,035,918
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10,160,928
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POLAND 3.1%
Grupa Lotos SA ................................... Oil, Gas & Consumable Fuels 306,000 4,766,508
b Polski Koncern Naftowy Orlen SA .................. Oil, Gas & Consumable Fuels 404,750 8,281,256
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13,047,764
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RUSSIA 8.7%
Gazprom .......................................... Oil, Gas & Consumable Fuels 2 21
Gazprom, ADR ..................................... Oil, Gas & Consumable Fuels 231,422 9,685,010
LUKOIL, ADR ...................................... Oil, Gas & Consumable Fuels 36,510 2,712,693
LUKOIL, ADR (London Exchange) .................... Oil, Gas & Consumable Fuels 101,006 7,487,070
Mining and Metallurgical Co. Norilsk Nickel ...... Metals & Mining 44,679 10,008,096
Mobile TeleSystems, ADR .......................... Wireless Telecommunication Services 77,300 5,114,168
OAO TMK, GDR ..................................... Energy Equipment & Services 41,000 1,568,250
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36,575,308
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SOUTH AFRICA 4.1%
Imperial Holdings Ltd. ........................... Air Freight & Logistics 84,630 1,696,159
JD Group Ltd. .................................... Specialty Retail 163,080 1,593,087
MTN Group Ltd. ................................... Wireless Telecommunication Services 241,400 3,681,054
Remgro Ltd. ...................................... Diversified Financial Services 389,570 10,045,828
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17,016,128
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SOUTH KOREA 9.2%
Avista Inc. ...................................... Textiles, Apparel & Luxury Goods 152,530 2,601,098
Hyundai Development Co. .......................... Construction & Engineering 104,630 9,367,354
Kangwon Land Inc. ................................ Hotels, Restaurants & Leisure 330,008 7,913,861
Neopharm Co. Ltd. ................................ Household Products 174,065 2,931,230
b SK Energy Co. Ltd. ............................... Oil, Gas & Consumable Fuels 78,859 10,800,300
SK Holdings Co. Ltd. ............................. Industrial Conglomerates 32,210 4,960,666
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38,574,509
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SWEDEN 1.2%
Oriflame Cosmetics SA, SDR ....................... Personal Products 91,120 4,994,180
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10 | Annual Report

Templeton Emerging Markets Fund

STATEMENT OF INVESTMENTS, AUGUST 31, 2007 (CONTINUED)

LONG TERM INVESTMENTS (CONTINUED)
COMMON STOCKS AND RIGHTS (CONTINUED)
TAIWAN 4.8%
MediaTek Inc. .................................... Semiconductors & Semiconductor Equipment 210,094 $ 3,565,232
Siliconware Precision Industries Co. ............. Semiconductors & Semiconductor Equipment 1,280,778 2,580,962
Taiwan Mobile Co. Ltd. ........................... Wireless Telecommunication Services 5,208,372 6,628,837
Taiwan Semiconductor Manufacturing Co. Ltd. ...... Semiconductors & Semiconductor Equipment 3,878,007 7,368,213
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20,143,244
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THAILAND 7.8%
Amata Corp. Public Co. Ltd., fgn. ................ Real Estate Management & Development 4,557,300 1,979,125
Bangkok Bank Public Co. Ltd., fgn. ............... Commercial Banks 618,000 2,143,457
Kasikornbank Public Co. Ltd., fgn. ............... Commercial Banks 2,251,200 5,183,468
Kiatnakin Bank Public Co. Ltd., fgn. ............. Consumer Finance 6,640,700 5,661,337
Land and Houses Public Co. Ltd., fgn. ............ Household Durables 6,872,332 1,592,394
PTT Exploration and Production Public Co.
Ltd., fgn. .................................... Oil, Gas & Consumable Fuels 1,226,600 4,468,814
PTT Public Co. Ltd., fgn. ........................ Oil, Gas & Consumable Fuels 578,000 4,919,149
Siam Cement Public Co. Ltd., fgn. ................ Construction Materials 608,620 4,505,668
Siam Commercial Bank Public Co. Ltd., fgn. ....... Commercial Banks 918,100 2,167,476
b True Corp. Public Co. Ltd., fgn., rts., 3/28/08 .. Diversified Telecommunication Services 246,818 --
-------------
32,620,888
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TURKEY 8.8%
Akbank TAS ....................................... Commercial Banks 2,723,231 17,380,766
Tupras-Turkiye Petrol Rafineleri AS .............. Oil, Gas & Consumable Fuels 427,186 9,772,604
Turkcell Iletisim Hizmetleri AS .................. Wireless Telecommunication Services 957,217 6,955,824
Turkiye Vakiflar Bankasi T.A.O., D ............... Commercial Banks 864,159 2,471,969
-------------
36,581,163
-------------
TOTAL COMMON STOCKS AND RIGHTS
(COST $218,121,650) ........................... 362,346,373
-------------
PREFERRED STOCKS 13.1%
BRAZIL 13.1%
Banco Bradesco SA, ADR, pfd. ..................... Commercial Banks 416,148 10,270,533
Companhia Vale do Rio Doce, ADR, pfd., A ......... Metals & Mining 483,150 20,171,512
Petroleo Brasileiro SA, ADR, pfd. ................ Oil, Gas & Consumable Fuels 335,160 17,840,567
Unibanco - Uniao de Bancos Brasileiros SA,
GDR, pfd. ..................................... Commercial Banks 56,700 6,326,586
-------------
TOTAL PREFERRED STOCKS
(COST $21,348,294) ............................ 54,609,198
-------------
TOTAL LONG TERM INVESTMENTS
(COST $239,469,944) ........................... 416,955,571
-------------

Annual Report | 11

Templeton Emerging Markets Fund

STATEMENT OF INVESTMENTS, AUGUST 31, 2007 (CONTINUED)

-----------------------------------------------------------------------------------------------------------------------------------
SHARES VALUE
-----------------------------------------------------------------------------------------------------------------------------------

SHORT TERM INVESTMENT (COST $485,545) 0.1%
MONEY MARKET FUND 0.1%
UNITED STATES 0.1%
c Franklin Institutional Fiduciary Trust Money
Market Portfolio, 4.98% ....................... 485,545 $ 485,545
-------------
TOTAL INVESTMENTS (COST $239,955,489) 99.8% ...... 417,441,116
OTHER ASSETS, LESS LIABILITIES 0.2% .............. 771,667
-------------
NET ASSETS 100.0% ................................ $418,212,783
=============

SELECTED PORTFOLIO ABBREVIATIONS

ADR - American Depository Receipt
GDR - Global Depository Receipt
SDR - Swedish Depository Receipt

a Security was purchased pursuant to Rule 144A under the Securities Act of 1933
and may be sold in transactions exempt from registration only to qualified
institutional buyers or in a public offering registered under the Securities Act
of 1933. These securities have been deemed liquid under guidelines approved by
the Fund's Board of Trustees. At August 31, 2007, the aggregate value of these
securities was $3,676,594, representing 0.88% of net assets.

b Non-income producing for the twelve months ended August 31, 2007.

c See Note 7 regarding investments in the Franklin Institutional Fiduciary Trust
Money Market Portfolio. The rate shown is the annualized seven-day yield at
period end.

12 | The accompanying notes are an integral part of these financial statements.
| Annual Report

Templeton Emerging Markets Fund

FINANCIAL STATEMENTS

STATEMENT OF ASSETS AND LIABILITIES
August 31, 2007

Assets:
Investments in securities:
Cost - Unaffiliated issuers ................................................................................. $ 239,469,944
Cost - Sweep Money Fund (Note 7) ............................................................................ 485,545
--------------
Total cost of investments ................................................................................... $ 239,955,489
==============
Value - Unaffiliated issuers ................................................................................ $ 416,955,571
Value - Sweep Money Fund (Note 7) ........................................................................... 485,545
--------------
Total value of investments .................................................................................. 417,441,116
Cash ........................................................................................................... 146
Foreign currency, at value (cost $666,122) ..................................................................... 668,346
Receivables:
Dividends ................................................................................................... 1,491,004
Foreign tax ................................................................................................. 45,761
--------------
Total assets ............................................................................................. 419,646,373
--------------
Liabilities:
Payables:
Investment securities purchased ............................................................................. 462,098
Affiliates .................................................................................................. 471,132
Deferred tax ................................................................................................ 327,188
Accrued expenses and other liabilities ......................................................................... 173,172
--------------
Total liabilities ........................................................................................ 1,433,590
--------------
Net assets, at value .................................................................................. $ 418,212,783
==============
Net assets consist of:
Paid-in capital ................................................................................................ $ 212,252,728
Distributions in excess of net investment income ............................................................... (3,100,238)
Net unrealized appreciation (depreciation) ..................................................................... 177,169,141
Accumulated net realized gain (loss) ........................................................................... 31,891,152
--------------
Net assets, at value .................................................................................. $ 418,212,783
==============
Shares outstanding ............................................................................................. 18,073,033
==============
Net asset value per share ...................................................................................... $ 23.14
==============

Annual Report |
The accompanying notes are an integral part of these financial statements. | 13

Templeton Emerging Markets Fund

FINANCIAL STATEMENTS (CONTINUED)

STATEMENT OF OPERATIONS
for the year ended August 31, 2007

Investment income:
Dividends (net of foreign taxes of $921,076)
Unaffiliated issuers ........................................................................................ $ 11,944,159
Sweep Money Fund (Note 7) ................................................................................... 385,603
Interest (net of foreign taxes of $5,443) ...................................................................... 29,425
--------------
Total investment income .................................................................................. 12,359,187
--------------
Expenses:
Management fees (Note 3a) ...................................................................................... 4,501,655
Administrative fees (Note 3b) .................................................................................. 543,399
Transfer agent fees ............................................................................................ 84,141
Custodian fees (Note 4) ........................................................................................ 311,376
Reports to shareholders ........................................................................................ 44,193
Registration and filing fees ................................................................................... 28,092
Professional fees .............................................................................................. 51,107
Trustees' fees and expenses .................................................................................... 33,928
Other .......................................................................................................... 12,927
--------------
Total expenses ........................................................................................... 5,610,818
Expense reductions (Note 4) .............................................................................. (1,501)
--------------
Net expenses .......................................................................................... 5,609,317
--------------
Net investment income .............................................................................. 6,749,870
--------------
Realized and unrealized gains (losses):
Net realized gain (loss) from:
Investments (includes foreign tax refund of $14,301 and net foreign taxes of $28,235) ....................... 60,647,158
Foreign currency transactions ............................................................................... 86,477
--------------
Net realized gain (loss) .............................................................................. 60,733,635
--------------
Net change in unrealized appreciation (depreciation) on:
Investments ................................................................................................. 73,985,202
Translation of assets and liabilities denominated in foreign currencies ..................................... 45,535
Change in deferred taxes on unrealized appreciation ......................................................... (325,014)
--------------
Net change in unrealized appreciation (depreciation) ........................................................... 73,705,723
--------------
Net realized and unrealized gain (loss) ........................................................................... 134,439,358
--------------
Net increase (decrease) in net assets resulting from operations ................................................... $ 141,189,228
==============

14 | The accompanying notes are an integral part of these financial statements.
| Annual Report

Templeton Emerging Markets Fund

FINANCIAL STATEMENTS (CONTINUED)

STATEMENTS OF CHANGES IN NET ASSETS

------------------------------
YEAR ENDED AUGUST 31,
2007 2006
------------------------------

Increase (decrease) in net assets:
Operations:
Net investment income ....................................................................... $ 6,749,870 $ 5,809,366
Net realized gain (loss) from investments and foreign currency transactions ................. 60,733,635 58,749,675
Net change in unrealized appreciation (depreciation) on investments, translation of assets
and liabilities denominated in foreign currencies, and deferred taxes .................... 73,705,723 16,706,575
------------------------------
Net increase (decrease) in net assets resulting from operations ....................... 141,189,228 81,265,616
------------------------------

Distributions to shareholders from:
Net investment income ....................................................................... (11,407,091) (6,873,880)
Net realized gains .......................................................................... (82,673,975) (28,486,651)
------------------------------
Total distributions to shareholders ............................................................ (94,081,066) (35,360,531)
------------------------------

Capital share transactions: (Note 2) ........................................................... 4,555,295 2,403,830
------------------------------

Net increase (decrease) in net assets ................................................. 51,663,457 48,308,915
Net assets:
Beginning of year .............................................................................. 366,549,326 318,240,411
------------------------------
End of year .................................................................................... $ 418,212,783 $ 366,549,326
==============================
Undistributed net investment income (distributions in excess of net investment income)
included in net assets:
End of year .................................................................................... $ (3,100,238) $ 868,049
==============================

Annual Report |
The accompanying notes are an integral part of these financial statements. | 15

Templeton Emerging Markets Fund

NOTES TO FINANCIAL STATEMENTS

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

Templeton Emerging Markets Fund (the Fund) is registered under the Investment
Company Act of 1940, as amended, (the 1940 Act) as a diversified, closed-end
investment company.

The following summarizes the Fund's significant accounting policies.

A. SECURITY VALUATION

Securities listed on a securities exchange or on the NASDAQ National Market
System are valued at the last quoted sale price or the official closing price of
the day, respectively. Over-the-counter securities and listed securities for
which there is no reported sale are valued within the range of the most recent
quoted bid and ask prices. Securities that trade in multiple markets or on
multiple exchanges are valued according to the broadest and most representative
market. Investments in open-end mutual funds are valued at the closing net asset
value.

Foreign securities are valued as of the close of trading on the foreign stock
exchange on which the security is primarily traded, or the NYSE, whichever is
earlier. If no sale is reported at that time, the foreign security will be
valued within the range of the most recent quoted bid and ask prices. The value
is then converted into its U.S. dollar equivalent at the foreign exchange rate
in effect at the close of the NYSE on the day that the value of the foreign
security is determined.

The Fund has procedures to determine the fair value of individual securities and
other assets for which market prices are not readily available or which may not
be reliably priced. Methods for valuing these securities may include:
fundamental analysis, matrix pricing, discounts from market prices of similar
securities, or discounts applied due to the nature and duration of restrictions
on the disposition of the securities. Due to the inherent uncertainty of
valuations of such securities, the fair values may differ significantly from the
values that would have been used had a ready market for such investments
existed. Occasionally, events occur between the time at which trading in a
security is completed and the close of the NYSE that might call into question
the availability (including the reliability) of the value of a portfolio
security held by the Fund. The investment manager monitors price movements
following the close of trading in foreign stock markets through a series of
country specific market proxies (such as baskets of American Depository
Receipts, futures contracts and exchange traded funds). These price movements
are measured against established trigger thresholds for each specific market
proxy to assist in determining if an event has occurred. If such an event
occurs, the securities may be valued using fair value procedures, which may
include the use of independent pricing services. All security valuation
procedures are approved by the Fund's Board of Trustees.

16 | Annual Report

Templeton Emerging Markets Fund

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

B. FOREIGN CURRENCY TRANSLATION

Portfolio securities and other assets and liabilities denominated in foreign
currencies are translated into U.S. dollars based on the exchange rate of such
currencies against U.S. dollars on the date of valuation. Purchases and sales of
securities, income and expense items denominated in foreign currencies are
translated into U.S. dollars at the exchange rate in effect on the transaction
date. Occasionally, events may impact the availability or reliability of foreign
exchange rates used to convert the U.S. dollar equivalent value. If such an
event occurs, the foreign exchange rate will be valued at fair value using
procedures established and approved by the Fund's Board of Trustees.

The Fund does not separately report the effect of changes in foreign exchange
rates from changes in market prices on securities held. Such changes are
included in net realized and unrealized gain or loss from investments on the
Statement of Operations.

Realized foreign exchange gains or losses arise from sales of foreign
currencies, currency gains or losses realized between the trade and settlement
dates on securities transactions and the difference between the recorded amounts
of dividends, interest, and foreign withholding taxes and the U.S. dollar
equivalent of the amounts actually received or paid. Net unrealized foreign
exchange gains and losses arise from changes in foreign exchange rates on
foreign denominated assets and liabilities other than investments in securities
held at the end of the reporting period.

C. FOREIGN CURRENCY CONTRACTS

When the Fund purchases or sells foreign securities it may enter into foreign
exchange contracts to minimize foreign exchange risk from the trade date to the
settlement date of the transactions. A foreign exchange contract is an agreement
between two parties to exchange different currencies at an agreed upon exchange
rate at a future date. Realized and unrealized gains and losses on these
contracts are included in the Statement of Operations.

The risks of these contracts include movement in the values of the foreign
currencies relative to the U.S. dollar and the possible inability of the
counterparties to fulfill their obligations under the contracts, which may be in
excess of the amount reflected in the Statement of Assets and Liabilities.

D. INCOME AND DEFERRED TAXES

No provision has been made for U.S. income taxes because it is the Fund's policy
to qualify as a regulated investment company under the Internal Revenue Code and
to distribute to shareholders substantially all of its taxable income and net
realized gains.

Foreign securities held by the Fund may be subject to foreign taxation on
dividend and interest income received. Foreign taxes, if any, are recorded based
on the tax regulations and rates that exist in the foreign markets in which the
Fund invests.

Annual Report | 17

Templeton Emerging Markets Fund

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

D. INCOME AND DEFERRED TAXES (CONTINUED)

The Fund may be subject to a tax imposed on net realized gains on securities of
certain foreign countries. The Fund records an estimated deferred tax liability
for net unrealized gains on these securities in an amount that would be payable
if the securities were disposed of on the valuation date.

E. SECURITY TRANSACTIONS, INVESTMENT INCOME, EXPENSES AND DISTRIBUTIONS

Security transactions are accounted for on trade date. Realized gains and losses
on security transactions are determined on a specific identification basis.
Interest income and estimated expenses are accrued daily. Dividend income is
recorded on the ex-dividend date except that certain dividends from foreign
securities are recognized as soon as the Fund is notified of the ex-dividend
date. Distributions to shareholders are recorded on the ex-dividend date and are
determined according to income tax regulations (tax basis). Distributable
earnings determined on a tax basis may differ from earnings recorded in
accordance with accounting principles generally accepted in the United States of
America. These differences may be permanent or temporary. Permanent differences
are reclassified among capital accounts to reflect their tax character. These
reclassifications have no impact on net assets or the results of operations.
Temporary differences are not reclassified, as they may reverse in subsequent
periods.

F. ACCOUNTING ESTIMATES

The preparation of financial statements in accordance with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the amounts of income
and expenses during the reporting period. Actual results could differ from those
estimates.

G. GUARANTEES AND INDEMNIFICATIONS

Under the Fund's organizational documents, its officers and trustees are
indemnified by the Fund against certain liabilities arising out of the
performance of their duties to the Fund. Additionally, in the normal course of
business, the Fund enters into contracts with service providers that contain
general indemnification clauses. The Fund's maximum exposure under these
arrangements is unknown as this would involve future claims that may be made
against the Fund that have not yet occurred. Currently, the Fund expects the
risk of loss to be remote.

18 | Annual Report

Templeton Emerging Markets Fund

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

2. SHARES OF BENEFICIAL INTEREST

At August 31, 2007, there were an unlimited number of shares authorized (without
par value). During the year ended August 31, 2007, 243,729 shares were issued
for $4,555,295 from reinvested distributions. During the year ended August 31,
2006, 132,985 shares were issued for $2,403,830 from reinvested distributions.

The Fund's Board of Trustees previously authorized an open-market share
repurchase program pursuant to which the Fund may repurchase, from time to time,
Fund shares in open-market transactions, at the discretion of management. This
authorization remains in effect. Through August 31, 2007, no shares have been
repurchased by the Fund.

3. TRANSACTION WITH AFFILIATES

Franklin Resources, Inc. is the holding company for various subsidiaries that
together are referred to as Franklin Templeton Investments. Certain officers and
trustees of the Fund are also officers and/or directors of the following
subsidiaries:

--------------------------------------------------------------------------------
SUBSIDIARY AFFILIATION
--------------------------------------------------------------------------------
Templeton Asset Management Ltd. (TAML) Investment manager
Franklin Templeton Services, LLC (FT Services) Administrative manager

A. MANAGEMENT FEES

The Fund pays an investment management fee to TAML based on the average daily
net assets of the Funds as follows:

--------------------------------------------------------------------------
ANNUALIZED FEE RATE NET ASSETS
--------------------------------------------------------------------------
1.250% Up to and including $1 billion
1.200% Over $1 billion, up to and including $5 billion
1.150% Over $5 billion, up to and including $10 billion
1.100% Over $10 billion, up to and including $15 billion
1.050% Over $15 billion, up to and including $20 billion
1.000% In excess of $20 billion

B. ADMINISTRATIVE FEES

The Fund pays an administrative fee to FT Services of 0.15% per year of the
average daily net assets of the Fund.

Annual Report | 19

Templeton Emerging Markets Fund

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

4. EXPENSE OFFSET ARRANGEMENT

The Fund has entered into an arrangement with its custodian whereby credits
realized as a result of uninvested cash balances are used to reduce a portion of
the Fund's custodian expenses. During the year ended August 31, 2007, the
custodian fees were reduced as noted in the Statement of Operations.

5. INCOME TAXES

The tax character of distributions paid during the years ended August 31, 2007
and 2006, was as follows:

---------------------------
2007 2006
---------------------------
Distributions paid from:
Ordinary income ........................... $20,614,355 $ 6,873,880
Long term capital gain .................... 73,466,711 28,486,651
---------------------------
$94,081,066 $ 35,360,531
===========================

At August 31, 2007, the cost of investments, net unrealized appreciation
(depreciation), undistributed ordinary income and undistributed long term
capital gains for income tax purposes were as follows:

Cost of investments ......................................... $248,033,818
=============

Unrealized appreciation ..................................... $170,559,632
Unrealized depreciation ..................................... (1,152,334)
-------------
Net unrealized appreciation (depreciation) .................. $169,407,298
=============

Undistributed ordinary income ............................... $ 11,203,671
Undistributed long term capital gains ....................... 25,665,572
-------------
Distributable earnings ...................................... $ 36,869,243
=============

Net investment income differs for financial statement and tax purposes primarily
due to differing treatments of foreign currency transactions, and passive
foreign investment company shares.

Net realized gains (losses) differ for financial statement and tax purposes
primarily due to differing treatments of wash sales, foreign currency
transactions, passive foreign investment company shares, and foreign taxes on
the sales of securities.

6. INVESTMENT TRANSACTIONS

Purchases and sales of investments (excluding short term securities) for the
year ended August 31, 2007, aggregated $118,551,324 and $198,185,794,
respectively.

20 | Annual Report

Templeton Emerging Markets Fund

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

7. INVESTMENTS IN FRANKLIN INSTITUTIONAL FIDUCIARY TRUST MONEY MARKET PORTFOLIO

The Fund may invest in the Franklin Institutional Fiduciary Trust Money Market
Portfolio (the Sweep Money Fund), an open-end investment company managed by
Franklin Advisers, Inc. (an affiliate of the investment manager). Management
fees paid by the Fund are reduced on assets invested in the Sweep Money Fund, in
an amount not to exceed the management and administrative fees paid by the Sweep
Money Fund.

8. CONCENTRATION OF RISK

Investing in foreign securities may include certain risks and considerations not
typically associated with investing in U.S. securities, such as fluctuating
currency values and changing local and regional economic, political and social
conditions, which may result in greater market volatility. In addition, certain
foreign securities may not be as liquid as U.S. securities.

9. REGULATORY AND LITIGATION MATTERS

As part of various investigations by a number of federal, state, and foreign
regulators and governmental entities, including the Securities and Exchange
Commission ("SEC"), relating to certain practices in the mutual fund industry,
including late trading, market timing and marketing support payments to
securities dealers who sell fund shares ("marketing support"), Franklin
Resources, Inc. and certain of its subsidiaries (collectively, the "Company"),
entered into settlements with certain of those regulators and governmental
entities. Specifically, the Company entered into settlements with the SEC, among
others, concerning market timing and marketing support.

On June 23, 2006, the SEC approved the proposed plan of distribution for the
marketing support settlement, and disbursement of the settlement monies to the
designated funds, in accordance with the terms and conditions of that settlement
and plan, was completed in September 2006. The Fund did not participate in that
settlement.

On June 6, 2007, the SEC posted for public comment the proposed plan of
distribution for the market timing settlement. Once the SEC approves the final
plan of distribution, disbursements of settlement monies will be made promptly
to individuals who were shareholders of the designated funds during the relevant
period, in accordance with the terms and conditions of the settlement and plan.

In addition, the Company, as well as most of the mutual funds within Franklin
Templeton Investments and certain current or former officers, Company directors,
fund directors, and employees, have been named in private lawsuits (styled as
shareholder class actions, or as derivative actions on behalf of either the
named funds or Franklin Resources, Inc.). The lawsuits relate to the industry
practices referenced above.

Annual Report | 21

Templeton Emerging Markets Fund

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

9. REGULATORY AND LITIGATION MATTERS (CONTINUED)

The Company and fund management believe that the claims made in each of the
private lawsuits referenced above are without merit and intend to defend against
them vigorously. The Company cannot predict with certainty the eventual outcome
of these lawsuits, nor whether they will have a material negative impact on the
Company. If it is determined that the Company bears responsibility for any
unlawful or inappropriate conduct that caused losses to the Fund, it is
committed to making the Fund or its shareholders whole, as appropriate.

10. NEW ACCOUNTING PRONOUNCEMENTS

In July 2006, the Financial Accounting Standards Board (FASB) issued FASB
Interpretation No. 48, "Accounting for Uncertainty in Income Taxes -- an
Interpretation of FASB Statement No. 109" ("FIN 48"), which clarifies the
accounting for uncertainty in tax positions taken or expected to be taken in a
tax return. FIN 48 provides guidance on the measurement, recognition,
classification and disclosure of tax positions, along with accounting for the
related interest and penalties. FIN 48 is effective for fiscal years beginning
after December 15, 2006, and is to be applied to all open tax years as of the
date of effectiveness. On December 22, 2006, the SEC extended the implementation
date to no later than the last net asset value calculation in the first
semi-annual reporting period beginning after December 15, 2006. The Fund
believes the adoption of FIN 48 will have no material impact on its financial
statements.

In September 2006, FASB issued FASB Statement No. 157, "Fair Value Measurement"
("SFAS 157"), which defines fair value establishes a framework for measuring
fair value, and expands disclosures about fair value meaurements. SFAS 157 is
effective for fiscal years beginning after November 15, 2007, and interim
periods within those fiscal years. The Fund believes the adoption of SFAS 157
will have no material impact on its financial statements.

22 | Annual Report

Templeton Emerging Markets Fund

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF TEMPLETON EMERGING MARKETS FUND

In our opinion, the accompanying statement of assets and liabilities, including
the statement of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of Templeton Emerging Markets Fund
(the "Fund") at August 31, 2007, the results of its operations for the year then
ended, the changes in its net assets for each of the two years in the period
then ended and the financial highlights for each of the five years in the period
then ended, in conformity with accounting principles generally accepted in the
United States of America. These financial statements and financial highlights
(hereafter referred to as "financial statements") are the responsibility of the
Fund's management. Our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits of these
financial statements in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits, which included confirmation of securities at August
31, 2007 by correspondence with the custodian and brokers, provide a reasonable
basis for our opinion.

PricewaterhouseCoopers LLP

San Francisco, California
October 18, 2007

Annual Report | 23

Templeton Emerging Markets Fund

TAX DESIGNATION (UNAUDITED)

Under Section 852(b)(3)(C) of the Internal Revenue Code (Code), the Fund
designates the maximum amount allowable but no less than $52,980,615 as a long
term capital gain dividend for the fiscal year ended August 31, 2007.

Under Section 871(k)(2)(C) of the Code, the Fund designates the maximum amount
allowable but no less than $6,741,628 as a short term capital gain dividend for
purposes of the tax imposed under Section 871(a)(1)(A) of the Code for the
fiscal year ended August 31, 2007.

Under Section 854(b)(2) of the Code, the Fund designates the maximum amount
allowable but no less than $8,093,124 as qualified dividends for purposes of the
maximum rate under Section 1(h)(11) of the Code for the fiscal year ended August
31, 2007. In January 2008, shareholders will receive Form 1099-DIV which will
include their share of qualified dividends distributed during the calendar year
2007. Shareholders are advised to check with their tax advisors for information
on the treatment of these amounts on their individual income tax returns.

Under Section 871(k)(1)(C) of the Code, the Fund designates the maximum amount
allowable but no less than $267,760 as interest related dividends for purposes
of the tax imposed under Section 871(a)(1)(A) of the Code for the fiscal year
ended August 31, 2007.

At August 31, 2007, more than 50% of the Templeton Emerging Markets Fund's total
assets were invested in securities of foreign issuers. In most instances,
foreign taxes were withheld from dividends paid to the Fund on these
investments. As shown in the table below, the Fund designates to shareholders
the foreign source income and foreign taxes paid, pursuant to Section 853 of the
Code. This designation will allow shareholders of record on (Date), to treat
their proportionate share of foreign taxes paid by the Fund as having been paid
directly by them. The shareholder shall consider these amounts as foreign taxes
paid in the tax year in which they receive the Fund distribution.

The following table provides a detailed analysis, by country, of foreign tax
paid, foreign source income, and foreign qualified dividends as designated by
the Fund, to shareholders of record.

RECORD DATE: 11/02/2007

-------------------------------------------------------------------------------
FOREIGN TAX FOREIGN FOREIGN
PAID SOURCE INCOME QUALIFIED DIVIDENDS
COUNTRY PER SHARE PER SHARE PER SHARE
-------------------------------------------------------------------------------
Austria .................... $0.0010 $0.0050 $0.0050
Brazil ..................... 0.0087 0.0767 0.0072
China ...................... 0.0000 0.0623 0.0395
Hong Kong .................. 0.0000 0.0156 0.0000
Hungary .................... 0.0000 0.0311 0.0311
India ...................... 0.0003 0.0169 0.0143
Indonesia .................. 0.0010 0.0048 0.0048
Malaysia ................... 0.0000 0.0103 0.0000
Mexico ..................... 0.0000 0.0317 0.0317
Pakistan ................... 0.0007 0.0051 0.0051

24 | Annual Report

Templeton Emerging Markets Fund

TAX DESIGNATION (UNAUDITED) (CONTINUED)

-------------------------------------------------------------------------------
FOREIGN TAX FOREIGN FOREIGN
PAID SOURCE INCOME QUALIFIED DIVIDENDS
COUNTRY PER SHARE PER SHARE PER SHARE
-------------------------------------------------------------------------------
Panama ..................... $0.0000 $0.0004 $0.0004
Philippines ................ 0.0002 0.0005 0.0005
Poland ..................... 0.0003 0.0015 0.0015
Russia ..................... 0.0049 0.0331 0.0324
South Africa ............... 0.0000 0.0230 0.0134
South Korea ................ 0.0051 0.0223 0.0223
Sweden ..................... 0.0010 0.0049 0.0000
Taiwan ..................... 0.0136 0.0451 0.0000
Thailand ................... 0.0050 0.0403 0.0403
Turkey ..................... 0.0095 0.0714 0.0714
United Kingdom ............. 0.0000 0.0109 0.0000
------------------------------------------------
TOTAL ...................... $0.0513 $0.5129 $0.3209
================================================

Foreign Tax Paid Per Share (Column 1) is the amount per share available to you,
as a tax credit (assuming you held your shares in the Fund for a minimum of 16
days during the 31-day period beginning 15 days before the ex-dividend date of
the Fund's distribution to which the foreign taxes relate), or, as a tax
deduction.

Foreign Source Income Per Share (Column 2) is the amount per share of income
dividends paid to you that is attributable to foreign securities held by the
Fund, plus any foreign taxes withheld on these dividends. The amounts reported
include foreign source qualified dividends that have not been adjusted for the
rate differential applicable to such dividend income. 1

Foreign Qualified Dividends Per Share (Column 3) is the amount per share of
foreign source qualified dividends the Fund paid to you, plus any foreign taxes
withheld on these dividends. These amounts represent the portion of the Foreign
Source Income reported to you in column 2 that were derived from qualified
foreign securities held by the Fund. 1

In January 2008, shareholders will receive Form 1099-DIV which will include
their share of taxes paid and foreign source income distributed during the
calendar year 2007. The Foreign Source Income reported on Form 1099-DIV has not
been adjusted for the rate differential on foreign source qualified dividend
income. Shareholders are advised to check with their tax advisors for
information on the treatment of these amounts on their 2007 individual income
tax returns.

1 Qualified dividends are taxed at a maximum rate of 15% (5% for those in the
10% and 15% income tax brackets). In determining the amount of foreign tax
credit that may be applied against the U.S. tax liability of individuals
receiving foreign source qualified dividends, adjustments may be required to the
foreign tax credit limitation calculation to reflect the rate differential
applicable to such dividend income. The rules however permit certain individuals
to elect not to apply the rate differential adjustments for capital gains and/or
dividends for any taxable year. Please consult your tax advisor and the
instructions to Form 1116 for more information.

Annual Report | 25

Templeton Emerging Markets Fund

ANNUAL MEETING OF SHAREHOLDERS, FEBRUARY 23, 2007 (UNAUDITED)

The Annual Meeting of Shareholders of the Fund was held at the Fund's offices,
500 East Broward Blvd., Fort Lauderdale, Florida, on February 23, 2007. The
purpose of the meeting was to elect five Trustees of the Fund. At the meeting,
the following persons were elected by the shareholders to serve as Trustees of
the Fund: Charles B. Johnson, Gregory E. Johnson, Frank A. Olson, Constantine D.
Tseretopoulos and Robert E. Wade.* No other business was transacted at the
meeting.

The results of the voting at the Annual Meeting are as follows:

The election of five (5) Trustees:

----------------------------------------------------------------------------------------------
% OF % OF
SHARES SHARES
% OF PRESENT % OF PRESENT
OUTSTANDING AND OUTSTANDING AND
TERM EXPIRING 2010 FOR SHARES VOTING WITHHELD SHARES VOTING
----------------------------------------------------------------------------------------------

Charles B. Johnson ......... 13,179,614 72.92% 95.37% 639,207 3.54% 4.63%
Gregory E. Johnson ......... 13,171,170 72.88% 95.31% 647,651 3.58% 4.69%
Frank A. Olson ............. 13,147,124 72.74% 95.14% 671,697 3.72% 4.86%
Constantine D.
Tseretopoulos ........... 13,174,653 72.90% 95.34% 644,168 3.56% 4.66%

----------------------------------------------------------------------------------------------
TERM EXPIRING 2009
----------------------------------------------------------------------------------------------

Robert E. Wade ............. 13,188,661 72.97% 95.44% 630,160 3.49% 4.56%

* Harris J. Ashton, Frank J. Crothers, Edith E. Holiday, David W. Niemiec,
and Larry D. Thompson are Trustees of the Fund who are currently serving
and whose terms of office continued after the Annual Meeting of
Shareholders.

26 | Annual Report

Templeton Emerging Markets Fund

DIVIDEND REINVESTMENT AND CASH PURCHASE PLAN

The Fund offers a Dividend Reinvestment and Cash Purchase Plan (the "Plan") with
the following features:

Shareholders must affirmatively elect to participate in the Plan; share
dividends and capital gains distributions will be reinvested automatically;
Mellon Investor Services, P.O. Box 358035, Pittsburgh, PA 15252-8035, will
provide additional Plan information upon request.

Whenever the Fund declares dividends in either cash or shares of the Fund, if
the market price is equal to or exceeds net asset value at the valuation date,
the participant will receive the dividends entirely in shares at a price equal
to the net asset value, but not less than 95% of the then current market price
of the Fund's shares. If the market price is lower than net asset value or if
dividends and/or capital gains distributions are payable only in cash, the
participant will receive shares purchased on the New York Stock Exchange or
otherwise on the open market.

A participant has the option of submitting additional cash payments to Mellon
Bank, N.A. (the "Plan Administrator"), in any amounts of at least $100, up to a
maximum of $5,000 per month, for the purchase of Fund shares for his or her
account. These payments shall be made by check or money order payable to "Mellon
Bank, N.A." and sent to Mellon Investor Services, P.O. Box 382009, Pittsburgh,
PA 15250-8009, Attention: Templeton Emerging Markets Fund. The Plan
Administrator shall apply such payments (less a $5.00 service charge and less a
pro rata share of trading fees) to purchases of Fund shares on the open market.

The automatic reinvestment of dividends and/or capital gains does not relieve
the participant of any income tax that may be payable on dividends or
distributions.

Whenever shares are purchased on the New York Stock Exchange or otherwise on the
open market, each participant will pay a pro rata portion of trading fees.
Trading fees will be deducted from amounts to be invested. The Plan
Administrator's fee for a sale of shares through the Plan are $15.00 per
transaction plus a $0.12 per share trading fee.

A participant may withdraw from the Plan without penalty at any time by written
notice to the Plan Administrator sent to Mellon Investor Services, P.O. Box
358035, Pittsburgh, PA 15252-8035. Upon withdrawal, the participant will
receive, without charge, share certificates issued in the participant's name for
all full shares held by the Plan Administrator; or, if the participant wishes,
the Plan Administrator will sell the shares and send the proceeds to the
participant, less a service charge of $15.00 and less trading fees of $0.12 per
share.

DIRECT DEPOSIT SERVICE FOR REGISTERED SHAREHOLDERS

Cash distributions can now be electronically credited to a checking or saving
account at any financial institution that participates in the Automated Clearing
House ("ACH") system. The Direct Deposit service is provided for registered
shareholders at no charge. To enroll in the service, access your account online
by going to www.melloninvestor.com/isd or dial 1-800-416-5585 (toll free) and
follow the instructions. Direct Deposit will begin with the next scheduled
distribution payment date following enrollment in the service.

Annual Report | 27

Templeton Emerging Markets Fund

TRANSFER AGENT

Mellon Investor Services LLC
P.O. Box 358015
Pittsburgh, PA 15252-8015
1-800-416-5585
www.melloninvestor.com

DIRECT REGISTRATION

If you are a registered shareholder of the Fund, purchases of shares of the Fund
can be electronically credited to your Fund account at Mellon Investor Services
LLC through Direct Registration. This service provides shareholders with a
convenient way to keep track of shares through book entry transactions, to
electronically move book-entry shares between broker-dealers, transfer agents
and DRS eligible issuers, and eliminates the possibility of lost certificated.
For additional information, please contact Mellon Investor Services at
1-800-416-5585.

SHAREHOLDER INFORMATION

Shares of Templeton Emerging Markets Fund are traded on the New York Stock
Exchange under the symbol "EMF." Information about the net asset value and the
market price is published each Monday in the WALL STREET JOURNAL, weekly in
BARRON'S and each Saturday in THE NEW YORK TIMES and other newspapers. Daily
market prices for the Fund's shares are published in the "New York Stock
Exchange Composite Transactions" section of newspapers.

For current information about dividends and shareholder accounts, call
1-800-416-5585. Registered shareholders can access their Fund account on-line
with Investor ServiceDirect(R). For information go to Mellon Investor Services'
web site at https://vault.melloninvestor.com/isd and follow the instructions.

The daily closing net asset value as of the previous business day may be
obtained when available by calling Franklin Templeton Fund Information after 7
a.m. Pacific time any business day at 1-800/DIAL BEN(R) (1-800/342-5236). The
Fund's net asset value and dividends are also listed on the NASDAQ Stock Market,
Inc.'s Mutual Fund Quotation Service ("NASDAQ MFQS").

Shareholders not receiving copies of reports to shareholders because their
shares are registered in the name of a broker or a custodian can request that
they be added to the Fund's mailing list, by writing Templeton Emerging Markets
Fund, 100 Fountain Parkway, P.O. Box 33030, St. Petersburg, FL 33733-8030.

28 | Annual Report

Templeton Emerging Markets Fund

BOARD MEMBERS AND OFFICERS

The name, year of birth and address of the officers and board members, as well
as their affiliations, positions held with the Fund, principal occupations
during the past five years and number of U.S. registered portfolios overseen in
the Franklin Templeton Investments fund complex are shown below. Generally, each
board member serves a three-year term that continues until that person's
successor is elected and qualified.

INDEPENDENT BOARD MEMBERS

------------------------------------------------------------------------------------------------------------------------------------
NUMBER OF PORTFOLIOS IN
NAME, YEAR OF BIRTH LENGTH OF FUND COMPLEX OVERSEEN
AND ADDRESS POSITION TIME SERVED BY BOARD MEMBER* OTHER DIRECTORSHIPS HELD
------------------------------------------------------------------------------------------------------------------------------------

HARRIS J. ASHTON (1932) Trustee Since 1992 139 Bar-S Foods (meat packing
500 East Broward Blvd. company).
Suite 2100
Fort Lauderdale, FL 33394-3091

PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Director of various companies; and FORMERLY, Director, RBC Holdings, Inc. (bank holding company) (until 2002); and President, Chief
Executive Officer and Chairman of the Board, General Host Corporation (nursery and craft centers) (until 1998).
------------------------------------------------------------------------------------------------------------------------------------
FRANK J. CROTHERS (1944) Trustee Since 1999 19 Fortis, Inc. (utility holding
500 East Broward Blvd. company), Nuinsco Resources Limited
Suite 2100 (mineral exploration), Fidelity
Fort Lauderdale, FL 33394-3091 Merchant Bank & Trust (Cayman)
Limited (financial services), C.A.
Bancorp Inc. (financial services),
Victory Nickel Inc. (mineral
exploration), ABACO Markets Limited
(retail distributors) and Belize
Electricity Limited (electric
utility).

PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Chairman, Island Corporate Holdings Ltd.; Director and Vice Chairman, Caribbean Utilities Company Ltd.; Director, Provo Power
Company Ltd.; director of various other business and nonprofit organizations; and FORMERLY, Chairman, Atlantic Equipment & Power
Ltd. (1977-2003).
------------------------------------------------------------------------------------------------------------------------------------
EDITH E. HOLIDAY (1952) Trustee Since 1996 139 Hess Corporation (exploration and
500 East Broward Blvd. refining of oil and gas), H.J.
Suite 2100 Heinz Company (processed foods and
Fort Lauderdale, FL 33394-3091 allied products), RTI International
Metals, Inc. (manufacture and
distribution of titanium), Canadian
National Railway (railroad) and
White Mountains Insurance Group,
Ltd. (holding company).

PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Director or Trustee of various companies and trusts; and FORMERLY, Assistant to the President of the United States and Secretary of
the Cabinet (1990-1993); General Counsel to the United States Treasury Department (1989-1990); and Counselor to the Secretary and
Assistant Secretary for Public Affairs and Public Liaison-United States Treasury Department (1988-1989).
------------------------------------------------------------------------------------------------------------------------------------

Annual Report | 29

DAVID W. NIEMIEC (1949) Trustee Since 2005 19 Emeritus Corporation (assisted
500 East Broward Blvd. living) and OSI Pharmaceuticals,
Suite 2100 Inc. (pharmaceutical products).
Fort Lauderdale, FL 33394-3091

PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Advisor, Saratoga Partners (private equity fund); Director, various private companies; and FORMERLY, Managing Director, Saratoga
Partners (1998-2001) and SBC Warburg Dillon Read (investment banking) (1997-1998); Vice Chairman, Dillon, Read & Co. Inc.
(investment banking) (1991-1997); and Chief Financial Officer, Dillon, Read & Co. Inc. (1982-1997).
------------------------------------------------------------------------------------------------------------------------------------
FRANK A. OLSON (1932) Trustee Since 2003 139 Hess Corporation (exploration and
500 East Broward Blvd. refining of oil and gas) and
Suite 2100 Sentient Jet (private jet service).
Fort Lauderdale, FL 33394-3091

PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Chairman Emeritus, The Hertz Corporation (car rental) (since 2000) (Chairman of the Board (1980-2000) and Chief Executive Officer
(1977-1999)); and FORMERLY, Chairman of the Board, President and Chief Executive Officer, UAL Corporation (airlines).
------------------------------------------------------------------------------------------------------------------------------------
LARRY D. THOMPSON (1945) Trustee Since 2005 139 None
500 East Broward Blvd.
Suite 2100
Fort Lauderdale, FL 33394-3091

PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Senior Vice President - Government Affairs, General Counsel and Secretary, PepsiCo, Inc. (consumer products); and FORMERLY,
Director, Delta Airlines (aviation) (2003-2005) and Providian Financial Corp. (credit card provider) (1997-2001); Senior Fellow of
The Brookings Institution (2003-2004); Visiting Professor, University of Georgia School of Law (2004); and Deputy Attorney General,
U.S. Department of Justice (2001-2003).
------------------------------------------------------------------------------------------------------------------------------------
CONSTANTINE D. TSERETOPOULOS Trustee Since 1999 19 None
(1954)
500 East Broward Blvd.
Suite 2100
Fort Lauderdale, FL 33394-3091

PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Physician, Lyford Cay Hospital (1987-present); director of various nonprofit organizations; and FORMERLY, Cardiology Fellow,
University of Maryland (1985-1987) and Internal Medicine Resident, Greater Baltimore Medical Center (1982-1985).
------------------------------------------------------------------------------------------------------------------------------------
ROBERT E. WADE (1946) Trustee Since 2006 33 El Oro and Exploration Co., p.l.c.
500 East Broward Blvd. (investments) and ARC Wireless
Suite 2100 Solutions, Inc. (wireless
Fort Lauderdale, FL 33394-3091 components and network products).

PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Practicing attorney.
------------------------------------------------------------------------------------------------------------------------------------

30 | Annual Report

INTERESTED BOARD MEMBERS AND OFFICERS

**CHARLES B. JOHNSON (1933) Trustee, Trustee and 139 None
One Franklin Parkway Chairman of Chairman of the
San Mateo, CA 94403-1906 the Board and Board since 1995
Vice President and Vice President
since 1992

PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Chairman of the Board, Member - Office of the Chairman and Director, Franklin Resources, Inc.; Director, Templeton Worldwide, Inc.;
and officer and/or director or trustee, as the case may be, of some of the other subsidiaries of Franklin Resources, Inc. and of 42
of the investment companies in Franklin Templeton Investments.
------------------------------------------------------------------------------------------------------------------------------------
**GREGORY E. JOHNSON (1961) Trustee Since 91 None
One Franklin Parkway February 2007
San Mateo, CA 94403-1906

PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Director, President and Chief Executive Officer, Franklin Resources, Inc.; President, Templeton Worldwide, Inc.; Director, Templeton
Asset Management Ltd.; and officer and/or director or trustee, as the case may be, of some of the other subsidiaries of Franklin
Resources, Inc. and of 33 of the investment companies in Franklin Templeton Investments.
------------------------------------------------------------------------------------------------------------------------------------
JAMES M. DAVIS (1952) Chief Chief Compliance Not Applicable Not Applicable
One Franklin Parkway Compliance Officer since 2004
San Mateo, CA 94403-1906 Officer and and Vice President
Vice President - AML Compliance
- AML since 2006
Compliance

PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Director, Global Compliance, Franklin Resources, Inc.; officer of some of the other subsidiaries of Franklin Resources, Inc. and of
46 of the investment companies in Franklin Templeton Investments; and FORMERLY, Director of Compliance, Franklin Resources, Inc.
(1994-2001).
------------------------------------------------------------------------------------------------------------------------------------
JEFFREY A. EVERETT (1964) Vice President Since 2001 Not Applicable Not Applicable
PO Box N-7759
Lyford Cay, Nassau, Bahamas

PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Chairman, President and Director, Templeton Global Advisors Limited; and officer of 14 of the investment companies in Franklin
Templeton Investments.
------------------------------------------------------------------------------------------------------------------------------------
JIMMY D. GAMBILL (1947) Senior Vice Since 2002 Not Applicable Not Applicable
500 East Broward Blvd. President and
Suite 2100 Chief Executive
Fort Lauderdale, FL 33394-3091 Officer -
Finance and
Administration

PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
President, Franklin Templeton Services, LLC; Senior Vice President, Templeton Worldwide, Inc.; and officer of some of the other
subsidiaries of Franklin Resources, Inc. and of 46 of the investment companies in Franklin Templeton Investments.
------------------------------------------------------------------------------------------------------------------------------------
DAVID P. GOSS (1947) Vice President Since 2000 Not Applicable Not Applicable
One Franklin Parkway
San Mateo, CA 94403-1906

PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Senior Associate General Counsel, Franklin Templeton Investments; officer and director of one of the subsidiaries of Franklin
Resources, Inc.; and officer of 46 of the investment companies in Franklin Templeton Investments.
------------------------------------------------------------------------------------------------------------------------------------

Annual Report | 31

RUPERT H. JOHNSON, JR. (1940) Vice President Since 1996 Not Applicable Not Applicable
One Franklin Parkway
San Mateo, CA 94403-1906

PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Vice Chairman, Member - Office of the Chairman and Director, Franklin Resources, Inc.; Director, Franklin Advisers, Inc. and
Templeton Worldwide, Inc.; Senior Vice President, Franklin Advisory Services, LLC; and officer and/or director or trustee, as the
case may be, of some of the other subsidiaries of Franklin Resources, Inc. and of 44 of the investment companies in Franklin
Templeton Investments.
------------------------------------------------------------------------------------------------------------------------------------
JOHN R. KAY (1940) Vice President Since 1994 Not Applicable Not Applicable
500 East Broward Blvd.
Suite 2100
Fort Lauderdale, FL 33394-3091

PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Vice President, Templeton Worldwide, Inc.; Senior Vice President, Franklin Templeton Services, LLC; and officer of some of the other
subsidiaries of Franklin Resources, Inc. and of 32 of the investment companies in Franklin Templeton Investments; and FORMERLY,
Vice President and Controller, Keystone Group, Inc.
------------------------------------------------------------------------------------------------------------------------------------
MARK MOBIUS (1936) President and President since Not Applicable Not Applicable
17th Floor, The Chater House Chief Executive 1987 and Chief
8 Connaught Road Officer - Executive
Central Hong Kong Investment Officer -
Management Investment
Management
since 2002

PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Portfolio Manager of various Templeton advisory affiliates; Managing Director, Templeton Asset Management Ltd.; and officer and/or
director, as the case may be, of some of the other subsidiaries of Franklin Resources, Inc. and of six of the investment companies
in Franklin Templeton Investments; and FORMERLY, President, International Investment Trust Company Limited (investment manager of
Taiwan R.O.C. Fund) (1986-1987); and Director, Vickers da Costa, Hong Kong (1983-1986).
------------------------------------------------------------------------------------------------------------------------------------
ROBERT C. ROSSELOT (1960) Secretary Since 2004 Not Applicable Not Applicable
500 East Broward Blvd.
Suite 2100
Fort Lauderdale, FL 33394-3091

PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Senior Associate General Counsel, Franklin Templeton Investments; Assistant Secretary, Franklin Resources, Inc.; Vice President and
Assistant Secretary, Templeton Investment Counsel, LLC; Vice President, Secretary and Trust Officer, Fiduciary Trust International
of the South; and officer of 14 of the investment companies in Franklin Templeton Investments.
------------------------------------------------------------------------------------------------------------------------------------
GREGORY R. SEWARD (1956) Treasurer Since 2004 Not Applicable Not Applicable
500 East Broward Blvd.
Suite 2100
Fort Lauderdale, FL 33394-3091

PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Vice President, Franklin Templeton Services, LLC; officer of 16 of the investment companies in Franklin Templeton Investments; and
FORMERLY, Vice President, JPMorgan Chase (2000-2004) and American General Financial Group (1991-2000).
------------------------------------------------------------------------------------------------------------------------------------

32 | Annual Report

CRAIG S. TYLE (1960) Vice President Since 2005 Not Applicable Not Applicable
One Franklin Parkway
San Mateo, CA 94403-1906

PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
General Counsel and Executive Vice President, Franklin Resources, Inc.; officer of some of the other subsidiaries of Franklin
Resources, Inc. and of 46 of the investment companies in Franklin Templeton Investments; and FORMERLY, Partner, Shearman & Sterling,
LLP (2004-2005); and General Counsel, Investment Company Institute (ICI) (1997-2004).
------------------------------------------------------------------------------------------------------------------------------------
GALEN VETTER (1951) Chief Financial Since 2004 Not Applicable Not Applicable
500 East Broward Blvd. Officer and
Suite 2100 Chief
Fort Lauderdale, FL 33394-3091 Accounting
Officer

PRINCIPAL OCCUPATION DURING PAST 5 YEARS:
Senior Vice President, Franklin Templeton Services, LLC; officer of 46 of the investment companies in Franklin Templeton
Investments; and FORMERLY, Managing Director, RSM McGladrey, Inc. (1999-2004); and Partner, McGladrey & Pullen, LLP (1979-1987 and
1991-2004).
------------------------------------------------------------------------------------------------------------------------------------

* We base the number of portfolios on each separate series of the U.S.
registered investment companies within the Franklin Templeton Investments fund
complex. These portfolios have a common investment manager or affiliated
investment managers.

** Charles B. Johnson is considered to be an interested person of the Fund under
the federal securities laws due to his position as officer and director and
major shareholder of Franklin Resources, Inc. (Resources), which is the parent
company of the Fund's investment manager. Gregory E. Johnson is considered to be
an interested person of the Fund under the federal securities laws due to his
position as officer and director of Resources.

Note 1: Charles B. Johnson and Rupert H. Johnson, Jr. are brothers and the
father and uncle, respectively, of Gregory E. Johnson.

Note 2: Officer information is current as of the date of this report. It is
possible that after this date, information about officers may change.

Note 3: Prior to August 31, 2007, Harmon E. Burns ceased to be a trustee of the
Fund.

THE SARBANES-OXLEY ACT OF 2002 AND RULES ADOPTED BY THE U.S. SECURITIES AND
EXCHANGE COMMISSION REQUIRE THE FUND TO DISCLOSE WHETHER THE FUND'S AUDIT
COMMITTEE INCLUDES AT LEAST ONE MEMBER WHO IS AN AUDIT COMMITTEE FINANCIAL
EXPERT WITHIN THE MEANING OF SUCH ACT AND RULES. THE FUND'S BOARD OF TRUSTEES
HAS DETERMINED THAT THERE IS AT LEAST ONE SUCH FINANCIAL EXPERT ON THE AUDIT
COMMITTEE AND HAS DESIGNATED EACH OF FRANK A. OLSON AND DAVID W. NIEMIEC AS AN
AUDIT COMMITTEE FINANCIAL EXPERT. THE BOARD BELIEVES THAT MESSRS. OLSON AND
NIEMIEC QUALIFY AS SUCH AN EXPERT IN VIEW OF THEIR EXTENSIVE BUSINESS BACKGROUND
AND EXPERIENCE. MR. OLSON HAS SERVED AS A MEMBER OF THE FUND AUDIT COMMITTEE
SINCE 2003. HE CURRENTLY SERVES AS CHAIRMAN EMERITUS OF THE HERTZ CORPORATION
AND WAS FORMERLY ITS CHAIRMAN OF THE BOARD FROM 1980 TO 2000 AND ITS CHIEF
EXECUTIVE OFFICER FROM 1977 TO 1999. MR. OLSON IS ALSO A DIRECTOR AND AUDIT
COMMITTEE MEMBER OF HESS CORPORATION, A FORMER DIRECTOR AND AUDIT COMMITTEE
MEMBER OF WHITE MOUNTAINS INSURANCE GROUP, LTD. AND A FORMER CHAIRMAN, PRESIDENT
AND CHIEF EXECUTIVE OFFICER OF UAL CORPORATION. MR. NIEMIEC HAS SERVED AS A
MEMBER OF THE FUND AUDIT COMMITTEE SINCE 2005, CURRENTLY SERVES AS AN ADVISOR TO
SARATOGA PARTNERS AND WAS FORMERLY ITS MANAGING DIRECTOR FROM 1998 TO 2001. MR.
NIEMIEC IS A DIRECTOR OF EMERITUS CORPORATION AND OSI PHARMACEUTICALS, INC. AND
VARIOUS PRIVATE COMPANIES, AND WAS FORMERLY MANAGING DIRECTOR OF SBC WARBURG
DILLON READ FROM 1997 TO 1998, AND WAS VICE CHAIRMAN FROM 1991 TO 1997 AND CHIEF
FINANCIAL OFFICER FROM 1982 TO 1997 OF DILLON, READ & CO. INC. AS A RESULT OF
SUCH BACKGROUND AND EXPERIENCE, THE BOARD OF TRUSTEES BELIEVES THAT MR. OLSON
AND MR. NIEMIEC HAVE EACH ACQUIRED AN UNDERSTANDING OF GENERALLY ACCEPTED
ACCOUNTING PRINCIPLES AND FINANCIAL STATEMENTS, THE GENERAL APPLICATION OF SUCH
PRINCIPLES IN CONNECTION WITH THE ACCOUNTING ESTIMATES, ACCRUALS AND RESERVES,
AND ANALYZING AND EVALUATING FINANCIAL STATEMENTS THAT PRESENT A BREADTH AND
LEVEL OF COMPLEXITY OF ACCOUNTING ISSUES GENERALLY COMPARABLE TO THOSE OF THE
FUND, AS WELL AS AN UNDERSTANDING OF INTERNAL CONTROLS AND PROCEDURES FOR
FINANCIAL REPORTING AND AN UNDERSTANDING OF AUDIT COMMITTEE FUNCTIONS. MESSRS.
OLSON AND NIEMIEC ARE INDEPENDENT TRUSTEES AS THAT TERM IS DEFINED UNDER THE
APPLICABLE U.S. SECURITIES AND EXCHANGE COMMISSION RULES AND RELEASES OR THE
LISTING STANDARDS APPLICABLE TO THE FUND.

Annual Report | 33

Templeton Emerging Markets Fund

SHAREHOLDER INFORMATION

BOARD REVIEW OF INVESTMENT MANAGEMENT AGREEMENT

At a meeting held May 22, 2007, the Board of Trustees (Board), including a
majority of non-interested or independent Trustees, approved renewal of the
investment management agreement for the Fund. In reaching this decision, the
Board took into account information furnished throughout the year at regular
Board meetings, as well as information prepared specifically in connection with
the annual renewal review process. Information furnished and discussed
throughout the year included investment performance reports on the Fund,
information on its share price discount to net asset value, and other related
financial information, as well as periodic reports on legal, compliance,
pricing, brokerage commissions and execution and other services provided by the
Investment Manager (Manager) and its affiliates. Information furnished
specifically in connection with the renewal process included a report prepared
by Lipper, Inc. (Lipper), an independent organization, as well as a Fund
profitability analysis report prepared by management. The Lipper reports
compared the Fund's investment performance and expenses with those of other
funds deemed comparable to the Fund as selected by Lipper. The Fund
profitability analysis report discussed the profitability to Franklin Templeton
Investments from its overall U.S. fund operations, as well as on an individual
fund-by-fund basis. Included with such profitability analysis report was
information on a fund-by-fund basis listing portfolio managers and other
accounts they manage, as well as information on management fees charged by the
Manager and its affiliates including management's explanation of differences
where relevant, and a three-year expense analysis with an explanation for any
increase in expense ratios. Additional material accompanying such report was a
memorandum prepared by management describing project initiatives and capital
investments relating to the services provided to the Fund by the Franklin
Templeton Investments organization, as well as a memorandum relating to
economies of scale.

In considering such materials, the independent Trustees received assistance and
advice from and met separately with independent counsel. In approving
continuance of the investment management agreement for the Fund, the Board,
including a majority of independent Trustees, determined that the existing
management fee structure was fair and reasonable and that continuance of the
investment management agreement was in the best interests of the Fund and its
shareholders. While attention was given to all information furnished, the
following discusses some primary factors relevant to the Board's decision.

NATURE, EXTENT AND QUALITY OF SERVICE. The Board was satisfied with the nature
and quality of the overall services provided by the Manager and its affiliates
to the Fund and its shareholders. In addition to investment performance and
expenses discussed later, the Board's opinion was based, in part, upon periodic
reports furnished them showing that the investment policies and restrictions for
the Fund were consistently complied with as well as other reports periodically
furnished the Board covering matters such as the compliance of portfolio
managers and other management personnel with the code of ethics adopted
throughout the Franklin Templeton fund complex, the adherence to fair value
pricing procedures established by the Board, and the accuracy of net asset value
calculations. Favorable consideration was given to management's continuous
efforts and expenditures in establishing back-up systems and recovery

34 | Annual Report

Templeton Emerging Markets Fund

SHAREHOLDER INFORMATION (CONTINUED)

BOARD REVIEW OF INVESTMENT MANAGEMENT AGREEMENT (CONTINUED)

procedures to function in the event of a natural disaster, it being noted that
such systems and procedures had functioned smoothly during the Florida
hurricanes and blackouts experienced in recent years. Among other factors taken
into account by the Board were the Manager's best execution trading policies,
including a favorable report by an independent portfolio trading analytical
firm. Consideration was also given to the experience of the Fund's portfolio
management team, the number of accounts managed and general method of
compensation. In this latter respect, the Board noted that a primary factor in
management's determination of the level of a portfolio manager's bonus
compensation was the relative investment performance of the funds he or she
managed and that a portion of such bonus was required to be invested in a
predesig-nated list of funds within such person's fund management area so as to
be aligned with the interests of Fund shareholders.

INVESTMENT PERFORMANCE. The Board placed significant emphasis on the investment
performance of the Fund in view of its importance to shareholders. While
consideration was given to performance reports and discussions with portfolio
managers at Board meetings during the year, particular attention in assessing
performance was given to the Lipper reports furnished for the agreement
renewals. The Lipper report for the Fund showed its investment performance for
the one-year period ended February 28, 2007, as well as the previous 10 years
ended that date in comparison to a seven-fund Lipper performance universe
consisting of the Fund and all other closed-end emerging markets funds as
selected by Lipper. Such report considers total return on a fund net asset value
basis without regard to market discounts or premiums to accurately reflect
investment performance. The Lipper report showed the Fund's total return for the
one-year period and on an annualized basis for each of the previous three-,
five- and 10-year periods to be the second lowest among the funds comprising
such universe. In discussing such performance, management explained that to a
large extent such performance reflected the Fund's adherence to a bottom-up
value-oriented approach in stock selection in a period of rising emerging market
stock markets and discussed certain investment weightings that had impacted
relative performance. The Board found the Fund's performance to be acceptable in
view of management's explanation and the Fund's actual level of performance
which, as shown in the Lipper report, was 13.29% for the one-year period and
23.81%, 24.55% and 9.99%, respectively, for the previous three-, five- and
10-year periods on an annualized basis.

COMPARATIVE EXPENSES. Consideration was given to a comparative analysis of the
management fees and total expense ratios of the Fund compared with a Lipper
selected expense group consisting of the Fund and the four other closed-end
emerging markets funds. Prior to making such comparison, the Board relied upon a
survey showing that the scope of management advisory services covered under the
Fund's contractual investment management agreement was similar to those provided
by fund managers to other fund groups. In reviewing comparative costs, emphasis
was given to each Fund's contractual investment management fee in comparison
with the investment contractual management fee that would have been charged by
the other four funds within the Lipper expense group assuming they were similar
in size to the Fund, as well as the actual total expenses of the Fund in
comparison with those of the other four funds.

Annual Report | 35

Templeton Emerging Markets Fund

SHAREHOLDER INFORMATION (CONTINUED)

BOARD REVIEW OF INVESTMENT MANAGEMENT AGREEMENT (CONTINUED)

The Lipper contractual investment management fee analysis considers
administrative fees to be part of management fees and the results of such
expense comparison showed the Fund's contractual investment management fee rate
to be the highest of such expense group, but within 10 basis points of the group
median, while its total actual expenses to be the second highest of such group,
but within eight basis points of the group median. The Board found the Fund's
contractual investment management fee and expenses in comparison to those of the
expense group to be acceptable in view of the factors relating to the Fund's
operation, such as the background and experience of its portfolio managers and
research staff and their physical presence and coverage in the geographical
areas in which the Fund invests.

MANAGEMENT PROFITABILITY. The Board also considered the level of profits
realized by the Manager and its affiliates in connection with the operation of
the Fund. In this respect, the Board reviewed the Fund profitability analysis
that addresses the overall profitability of Franklin Templeton's U.S. fund
business, as well as its profits in providing management and other services to
the Fund. Specific attention was given to the methodology followed in allocating
costs to the Fund, it being recognized that allocation methodologies are
inherently subjective and various allocation methodologies may each be
reasonable while producing different results. In this respect, the Board noted
that, while being continuously refined and reflecting changes in the manager's
own cost accounting, the allocation methodology was consistent with that
followed in profitability report presentations made in prior years and that the
Fund's independent registered public accounting firm had been engaged by the
Manager to perform certain procedures on a biennial basis, specified and
approved by the Manager and the Fund's Board solely for their purposes and use
in reference to the profitability analysis. In reviewing and discussing such
analysis, management discussed with the Board its belief that costs incurred in
establishing the infrastructure necessary for the type of fund operations
conducted by the Manager and its affiliates may not be fully reflected in the
expenses allocated to the Fund in determining its profitability, as well as the
fact that the level of profits, to a certain extent, reflected operational cost
savings and efficiencies initiated by management. In addition, the Board
considered a third-party study comparing the profitability of the Manager's
parent on an overall basis as compared to other publicly held managers broken
down to show profitability from management operations exclusive of distribution
expenses, as well as profitability including distribution expenses. The Board
also considered the extent to which the Manager and its affiliates might derive
ancillary benefits from fund operations, as well as potential benefits resulting
from allocation of fund brokerage and the use of "soft" commission dollars to
pay for research. Based upon its consideration of all these factors, the Board
determined that the level of profits realized by the Manager and its affiliates
from providing services to the Fund was not excessive in view of the nature,
quality and extent of services provided.

36 | Annual Report

Templeton Emerging Markets Fund

SHAREHOLDER INFORMATION (CONTINUED)

BOARD REVIEW OF INVESTMENT MANAGEMENT AGREEMENT (CONTINUED)

ECONOMIES OF SCALE. The Board also considered whether the Manager realizes
economies of scale as the Fund grows larger and the extent to which any such
benefit is shared with the Fund and its shareholders. The Board believed that a
manager's ability to realize economies of scale and the sharing of such benefit
is a more relevant consideration in the case of an open-end fund whose size
increases as a result of the continuous sale of its shares. A closed-end
investment company such as the Fund does not continuously offer shares, and
growth following its initial public offering will primarily result from market
appreciation, which benefits its shareholders. While believing economies of
scale to be less of a factor in the context of a closed-end fund, the Board
believes at some point an increase in size may lead to economies of scale that
should be shared with the Fund and its shareholders and intends to monitor
future growth of the Fund accordingly. The Board also noted that it had
previously added a breakpoint to the Fund's investment management fee at the $1
billion level.

PROXY VOTING POLICIES AND PROCEDURES

The Fund has established Proxy Voting Policies and Procedures (Policies) that
the Fund uses to determine how to vote proxies relating to portfolio securities.
Shareholders may view the Fund's complete Policies online at
franklintempleton.com. Alternatively, shareholders may request copies of the
Policies free of charge by calling the Proxy Group collect at 1-954/527-7678 or
by sending a written request to: Franklin Templeton Companies, LLC, 500 East
Broward Boulevard, Suite 1500, Fort Lauderdale, FL 33394, Attention: Proxy
Group. Copies of the Fund's proxy voting records are also made available online
at franklintempleton.com and posted on the U.S. Securities and Exchange
Commission's website at sec.gov and reflect the most recent 12-month period
ended June 30.

QUARTERLY STATEMENT OF INVESTMENTS

The Fund files a complete statement of investments with the U.S. Securities and
Exchange Commission for the first and third quarters for each fiscal year on
Form N-Q. Shareholders may view the filed Form N-Q by visiting the Commission's
website at sec.gov. The filed form may also be viewed and copied at the
Commission's Public Reference Room in Washington, DC. Information regarding the
operations of the Public Reference Room may be obtained by calling
1-800/SEC-0330.

Annual Report | 37

Templeton Emerging Markets Fund

SHAREHOLDER INFORMATION (CONTINUED)

CERTIFICATIONS

The Fund's Chief Executive Officer - Finance and Administration is required by
the New York Stock Exchange's Listing Standards to file annually with the
Exchange a certification that he is not aware of any violation by the Fund of
the Exchange's Corporate Governance Standards applicable to the Fund. The Fund
has filed such certification.

In addition, the Fund's Chief Executive Officer - Finance and Administration and
Chief Financial Officer and Chief Accounting Officer are required by the rules
of the U.S. Securities and Exchange Commission to provide certain certifications
with respect to the Fund's Form N-CSR and Form N-CSRS (which include the Fund's
annual and semiannual reports to shareholders) that are filed semiannually with
the Commission. The Fund has filed such certifications with its Form N-CSRS for
the six months ended February 28, 2007. Additionally, the Fund expects to file,
on or about October 30, 2007, such certifications with its Form N-CSR for the
year ended August 31, 2007.

38 | Annual Report

This page intentionally left blank.

Literature Request

LITERATURE REQUEST. TO RECEIVE A BROCHURE AND PROSPECTUS, PLEASE CALL US AT
1-800/DIAL BEN(R) (1-800/342-5236) OR VISIT FRANKLINTEMPLETON.COM. INVESTORS
SHOULD CAREFULLY CONSIDER A FUND'S INVESTMENT GOALS, RISKS, CHARGES AND EXPENSES
BEFORE INVESTING. THE PROSPECTUS CONTAINS THIS AND OTHER INFORMATION. PLEASE
CAREFULLY READ THE PROSPECTUS BEFORE INVESTING. To ensure the highest quality of
service, we may monitor, record and access telephone calls to or from our
service departments. These calls can be identified by the presence of a regular
beeping tone.

FRANKLIN TEMPLETON FUNDS

INTERNATIONAL

Mutual European Fund
Templeton BRIC Fund
Templeton China World Fund
Templeton Developing Markets Trust
Templeton Emerging Markets Small Cap Fund
Templeton Foreign Fund
Templeton Foreign Smaller Companies Fund 1

GLOBAL

Mutual Discovery Fund
Templeton Global Long-Short Fund
Templeton Global Opportunities Trust
Templeton Global Smaller Companies Fund 1
Templeton Growth Fund
Templeton World Fund

GROWTH

Franklin Aggressive Growth Fund
Franklin Capital Growth Fund
Franklin Flex Cap Growth Fund
Franklin Small Cap Growth Fund II 2
Franklin Small-Mid Cap Growth Fund

VALUE

Franklin Balance Sheet Investment Fund 1
Franklin Equity Income Fund
Franklin Large Cap Value Fund
Franklin MicroCap Value Fund 1
Franklin MidCap Value Fund
Franklin Small Cap Value Fund
Mutual Beacon Fund
Mutual Qualified Fund
Mutual Recovery Fund 3
Mutual Shares Fund

BLEND

Franklin Balanced Fund
Franklin Convertible Securities Fund
Franklin Growth Fund
Franklin Rising Dividends Fund

SECTOR

Franklin Biotechnology Discovery Fund
Franklin DynaTech Fund
Franklin Global Communications Fund
Franklin Global Health Care Fund
Franklin Global Real Estate Fund
Franklin Gold and Precious Metals Fund
Franklin Natural Resources Fund
Franklin Real Estate Securities Fund
Franklin Technology Fund
Franklin Utilities Fund
Mutual Financial Services Fund

ASSET ALLOCATION

Franklin Templeton Corefolio(R) Allocation Fund
Franklin Templeton Founding Funds Allocation Fund
Franklin Templeton Perspectives Allocation Fund
Franklin Templeton Conservative Target Fund
Franklin Templeton Growth Target Fund
Franklin Templeton Moderate Target Fund
Franklin Templeton 2015 Retirement Target Fund
Franklin Templeton 2025 Retirement Target Fund
Franklin Templeton 2035 Retirement Target Fund
Franklin Templeton 2045 Retirement Target Fund

INCOME

Franklin Adjustable U.S. Government
Securities Fund 4
Franklin Floating Rate Daily Access Fund
Franklin High Income Fund 5
Franklin Income Fund
Franklin Limited Maturity
U.S. Government Securities Fund 4
Franklin Low Duration Total Return Fund
Franklin Real Return Fund
Franklin Strategic Income Fund
Franklin Strategic Mortgage Portfolio
Franklin Templeton Hard Currency Fund
Franklin Total Return Fund
Franklin U.S. Government Securities Fund 4
Templeton Global Bond Fund
Templeton Income Fund

TAX-FREE INCOME 6

NATIONAL FUNDS

Double Tax-Free Income Fund
Federal Tax-Free Income Fund
High Yield Tax-Free Income Fund
Insured Tax-Free Income Fund 7

LIMITED-TERM FUNDS

California Limited-Term Tax-Free Income Fund
Federal Limited-Term Tax-Free Income Fund
New York Limited-Term Tax-Free Income Fund

INTERMEDIATE-TERM FUNDS

California Intermediate-Term Tax-Free Income Fund
Federal Intermediate-Term Tax-Free Income Fund
New York Intermediate-Term Tax-Free Income Fund

STATE-SPECIFIC

Alabama
Arizona
California 8
Colorado
Connecticut
Florida 8
Georgia
Kentucky
Louisiana
Maryland
Massachusetts 7
Michigan 7
Minnesota 7
Missouri
New Jersey
New York 8
North Carolina
Ohio 7
Oregon
Pennsylvania
Tennessee
Virginia

INSURANCE FUNDS

Franklin Templeton Variable Insurance
Products Trust 9

1. The fund is open only to existing shareholders and select retirement plans.

2. The fund is closed to new investors. Existing shareholders can continue
adding to their accounts.

3. The fund is a continuously offered, closed-end fund. Shares may be purchased
daily; there is no daily redemption. However, each quarter, pending board
approval, the fund will authorize the repurchase of 5%-25% of the outstanding
number of shares. Investors may tender all or a portion of their shares during
the tender period.

4. An investment in the fund is neither insured nor guaranteed by the U.S.
government or by any other entity or institution.

5. Effective 10/1/06, Franklin's AGE High Income Fund changed its name to
Franklin High Income Fund. The fund's investment goal and strategy remained the
same.

6. For investors subject to the alternative minimum tax, a small portion of fund
dividends may be taxable. Distributions of capital gains are generally taxable.

7. The fund invests primarily in insured municipal securities.

8. These funds are available in two or more variations, including long-term
portfolios, portfolios of insured securities, a high-yield portfolio (CA) and
limited-term, intermediate-term and money market portfolios (CA and NY).

9. The funds of the Franklin Templeton Variable Insurance Products Trust are
generally available only through insurance company variable contracts.

05/07 Not part of the annual report

[LOGO](R) 100 Fountain Parkway
FRANKLIN TEMPLETON P.O. Box 33030
INVESTMENTS St. Petersburg, FL 33733-8030

ANNUAL REPORT

TEMPLETON EMERGING MARKETS FUND

INVESTMENT MANAGER

Templeton Asset Management Ltd.

TRANSFER AGENT

Mellon Investor Services LLC
P.O. Box 358015
Pittsburgh, PA 15252-8015
Toll free number: 1-800/416-5585
Hearing Impaired phone number: 1-800/231-5469
Foreign Shareholders phone number: 201/680-6578
www.melloninvestor.com/isd

FUND INFORMATION

1-800/342-5236

Investors should be aware that the value of investments made for the Fund may go
down as well as up. Like any investment in securities, the value of the Fund's
portfolio will be subject to the risk of loss from market, currency, economic,
political and other factors. The Fund and its investors are not protected from
such losses by the investment manager. Therefore, investors who cannot accept
this risk should not invest in shares of the Fund.

To ensure the highest quality of service, telephone calls to or from our service
departments may be monitored, recorded and accessed. These calls can be
identified by the presence of a regular beeping tone.

TLEMF A2007 10/07

ITEM 2. CODE OF ETHICS.

(a) The Registrant has adopted a code of ethics that applies to its principal
executive officers and principal financial and accounting officer.

(d) N/A

(f) Pursuant to Item 12(a)(1), the Registrant is attaching as an exhibit a
copy of its code of ethics that applies to its principal executive
officers and principal financial and accounting officer.

ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.

(a)(1) The Registrant has an audit committee financial expert serving on its
audit committee.

(2) The audit committee financial expert is David W. Niemiec, he is
"independent" as defined under the relevant Securities and Exchange Commission
Rules and Releases.

ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

(a) Audit Fees

The aggregate fees paid to the principal accountant for professional services
rendered by the principal accountant for the audit of the registrant's annual
financial statements or for services that are normally provided by the principal
accountant in connection with statutory and regulatory filings or engagements
were $28,019 for the fiscal year ended August 31, 2007 and $33,461 for the
fiscal year ended August 31, 2006.

(b) Audit-Related Fees

There were no fees paid to the principal accountant for assurance and related
services rendered by the principal accountant to the registrant that are
reasonably related to the performance of the audit of the registrant's financial
statements and are not reported under paragraph (a) of Item 4.

There were no fees paid to the principal accountant for assurance and related
services rendered by the principal accountant to the registrant's investment
adviser and any entity controlling, controlled by or under common control with
the investment adviser that provides ongoing services to the registrant that are
reasonably related to the performance of the audit of their financial
statements.

There were no fees paid to the principal accountant for professional services
rendered by the principal accountant to the registrant for tax compliance, tax
advice and tax planning.

The aggregate fees paid to the principal accountant for professional services
rendered by the principal accountant to the registrant's investment adviser and
any entity controlling, controlled by or under common control with the
investment adviser that provides ongoing services to the registrant for tax
compliance, tax advice and tax planning were $46,000 for the fiscal year ended
August 31, 2007 and $3,961 for the fiscal year ended August 31, 2006. The
services for which these fees were paid included tax compliance and advice.

(d) All Other Fees

The aggregate fees paid to the principal accountant for products and services
rendered by the principal accountant to the registrant not reported in
paragraphs (a)-(c) of Item 4 were $0 for the fiscal year ended August 31, 2007
and $204 for the fiscal year ended August 31, 2006. The services for which these
fees were paid included review of materials provided to the fund Board in
connection with the investment management contract renewal process.

The aggregate fees paid to the principal accountant for products and services
rendered by the principal accountant to the registrant's investment adviser and
any entity controlling, controlled by or under common control with the
investment adviser that provides ongoing services to the registrant not reported
in paragraphs (a)-(c) of Item 4 were $0 for the fiscal year ended August 31,
2007 and $175,657 for the fiscal year ended August 31, 2006. The services for
which these fees were paid included review of materials provided to the fund
Board in connection with the investment management contract renewal process.

(e) (1) The registrant's audit committee is directly responsible for approving
the services to be provided by the auditors, including:

(i) pre-approval of all audit and audit related services;

(ii) pre-approval of all non-audit related services to be provided to
the Fund by the auditors;

(iii) pre-approval of all non-audit related services to be provided to
the registrant by the auditors to the registrant's investment adviser or to any
entity that controls, is controlled by or is under common control with the
registrant's investment adviser and that provides ongoing services to the
registrant where the non-audit services relate directly to the operations or
financial reporting of the registrant; and

(iv) establishment by the audit committee, if deemed necessary or
appropriate, as an alternative to committee pre-approval of services to be
provided by the auditors, as required by paragraphs (ii) and (iii) above, of
policies and procedures to permit such services to be pre-approved by other
means, such as through establishment of guidelines or by action of a designated
member or members of the committee; provided the policies and procedures are
detailed as to the particular service and the committee is informed of each
service and such policies and procedures do not include delegation of audit
committee responsibilities, as contemplated under the Securities Exchange Act of
1934, to management; subject, in the case of (ii) through (iv), to any waivers,
exceptions or exemptions that may be available under applicable law or rules.

(e) (2) None of the services provided to the registrant described in paragraphs
(b)-(d) of Item 4 were approved by the audit committee pursuant to paragraph
(c)(7)(i)(C) of Rule 2-01 of regulation S-X.

(f) No disclosures are required by this Item 4(f).

(g) The aggregate non-audit fees paid to the principal accountant for services
rendered by the principal accountant to the registrant and the registrant's
investment adviser and any entity controlling, controlled by or under common
control with the investment adviser that provides ongoing services to the
registrant were $46,000 for the fiscal year ended August 31, 2007 and $179,822
for the fiscal year ended August 31, 2006.

(h) The registrant's audit committee of the board has considered whether the
provision of non-audit services that were rendered to the registrant's
investment adviser (not including any sub-adviser whose role is primarily
portfolio management and is subcontracted with or overseen by another investment
adviser), and any entity controlling, controlled by, or under common control
with the investment adviser that provides ongoing services to the registrant
that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of
Regulation S-X is compatible with maintaining the principal accountant's
independence.

ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.

Members of the Audit Committee are: Ann Torre-Bates, Frank J. Crothers, David W.
Niemiec and Constantine D. Tseretopoulos.

ITEM 6. SCHEDULE OF INVESTMENTS. N/A

ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.

The board of trustees of the Fund has delegated the authority to vote proxies
related to the portfolio securities held by the Fund to the Fund's manager
Templeton Asset Management Limited in accordance with the Proxy Voting Policies
and Procedures (Policies) adopted by the manager.

The manager has delegated its administrative duties with respect to the voting
of proxies to the Proxy Group within Franklin Templeton Companies, LLC (Proxy
Group), an affiliate and wholly owned subsidiary of Franklin Resources, Inc. All
proxies received by the Proxy Group will be voted based upon the manager's
instructions and/or policies.

To assist it in analyzing proxies, the manager subscribes to RiskMetrics Group
(RiskMetrics), an unaffiliated third party corporate governance research service
that provides in-depth analyses of shareholder meeting agendas, vote
recommendations, recordkeeping and vote disclosure services. In addition, the
manager subscribes to Glass, Lewis & Co., LLC (Glass Lewis), an unaffiliated
third party analytical research firm, to receive analyses and vote
recommendations on the shareholder meetings of publicly held U.S. companies.
Although RiskMetrics' and/or Glass Lewis' analyses are thoroughly reviewed and
considered in making a final voting decision, the manager does not consider
recommendations from RiskMetrics, Glass Lewis or any other third party to be
determinative of the manager,s ultimate decision. The manager votes proxies
solely in the interests of the Fund and its shareholders. As a matter of policy,
the officers, directors/trustees and employees of the Fund, the manager and the
Proxy Group will not be influenced by outside sources whose interests conflict
with the interests of the Fund and its shareholders. Efforts are made to resolve
all conflicts in the interests of the manager's clients. Material conflicts of
interest are identified by the Proxy Group based upon analyses of client, broker
and vendor lists, information periodically gathered from directors and officers,
and information derived from other sources, including public filings. In
situations where a material conflict of interest is identified, the Proxy Group
may defer to the voting recommendation of RiskMetrics, Glass Lewis or those of
another independent third party provider of proxy services; or send the proxy
directly to the Fund with a recommendation regarding the vote for approval. If
the conflict is not resolved by the Fund, the Proxy Group may refer the matter,
along with the recommended course of action by the manager to an
interdepartmental Proxy Review Committee (which may include portfolio managers
and/or research analysts employed by the manager), for evaluation and voting
instructions. The Proxy Review Committee may defer to the voting recommendation
of RiskMetrics, Glass Lewis or those of another independent third party provider
of proxy services; or send the proxy directly to the Fund. Where the Proxy Group
or the Proxy Review Committee refers a matter to the Fund, it may rely upon the
instructions of a representative of the Fund, such as the board of trustees or a
committee of the board.

Where a material conflict of interest has been identified, but the items on
which the manager's vote recommendations differ from Glass Lewis, RiskMetrics,
or another independent third party provider of proxy services relate
specifically to (1) shareholder proposals regarding social or environmental
issues or political contributions, (2) "Other Business" without describing the
matters that might be considered, or (3) items the manager wishes to vote in
opposition to the recommendations of an issuer's management, the Proxy Group may
defer to the vote recommendations of the manager rather than sending the proxy
directly to the Fund for approval.

To avoid certain potential conflicts of interest, the manager will employ echo
voting, if possible, in the following instances: (1) when the Fund invests in an
underlying fund in reliance on Sections 12(d)(1) of the 1940 Act, or pursuant to
an SEC exemptive order; (2) when the Fund invests uninvested cash in affiliated
money market funds pursuant to an SEC exemptive order ("cash sweep
arrangement"); or (3) when required pursuant to the Fund's governing documents
or applicable law. Echo voting means that the Investment Manager will vote the
shares in the same proportion as the vote of all of the other holders of the
fund's shares.

The recommendation of management on any issue is a factor which the manager
considers in determining how proxies should be voted, but is not determinative
of the manager's ultimate decision. As a matter of practice, the votes with
respect to most issues are cast in accordance with the position of the company's
management. Each issue, however, is considered on its own merits, and the
manager will not support the position of the company's management in any
situation where it deems that the ratification of management's position would
adversely affect the investment merits of owning that company's shares.

MANAGER'S PROXY VOTING POLICIES AND PRINCIPLES The manager has adopted general
proxy voting guidelines, which are summarized below. These guidelines are not an
exhaustive list of all the issues that may arise and the manager cannot
anticipate all future situations. In all cases, each proxy will be considered
based on the relevant facts and circumstances.

BOARD OF DIRECTORS. The manager supports an independent board of directors, and
prefers that key committees such as audit, nominating, and compensation
committees be comprised of independent directors. The manager will generally
vote against management efforts to classify a board and will generally support
proposals to declassify the board of directors. The manager may withhold votes
from directors who have attended less than 75% of meetings without a valid
reason. While generally in favor of separating Chairman and CEO positions, the
manager will review this issue as well as proposals to restore or provide for
cumulative voting on a case-by-case basis, taking into consideration factors
such as the company's corporate governance guidelines or provisions and
performance.

RATIFICATION OF AUDITORS OF PORTFOLIO COMPANIES. In light of several high
profile accounting scandals, the manager will closely scrutinize the role and
performance of auditors. On a case-by-case basis, the manager will examine
proposals relating to non-audit relationships and non-audit fees. The manager
will also consider, on a case-by-case basis, proposals to rotate auditors, and
will vote against the ratification of auditors when there is clear and
compelling evidence of accounting irregularities or negligence.

MANAGEMENT AND DIRECTOR COMPENSATION. A company's equity-based compensation plan
should be in alignment with its shareholders' long-term interests. The manager
believes that executive compensation should be directly linked to the
performance of the company. The manager evaluates plans on a case-by-case basis
by considering several factors to determine whether the plan is fair and
reasonable, including the RiskMetrics quantitative model utilized to assess such
plans and/or the Glass Lewis evaluation of the plans. The manager will generally
oppose plans that have the potential to be excessively dilutive, and will almost
always oppose plans that are structured to allow the repricing of underwater
options, or plans that have an automatic share replenishment "evergreen"
feature. The manager will generally support employee stock option plans in which
the purchase price is at least 85% of fair market value, and when potential
dilution is 10% or less.

Severance compensation arrangements will be reviewed on a case-by-case basis,
although the manager will generally oppose "golden parachutes" that are
considered to be excessive. The manager will normally support proposals that
require a percentage of directors' compensation to be in the form of common
stock, as it aligns their interests with those of shareholders. The manager will
review on a case-by-case basis any shareholder proposals to adopt policies on
expensing stock option plans.

ANTI-TAKEOVER MECHANISMS AND RELATED ISSUES. The manager generally opposes
anti-takeover measures since they tend to reduce shareholder rights. On
occasion, the manager may vote with management when the research analyst has
concluded that the proposal is not onerous and would not harm the Fund or its
shareholders' interests. The manager generally supports proposals that require
shareholder rights' plans ("poison pills") to be subject to a shareholder vote
and will closely evaluate such plans on a case-by-case basis to determine
whether or not they warrant support. The manager will generally vote against any
proposal to issue stock that has unequal or subordinate voting rights. The
manager generally opposes any supermajority voting requirements as well as the
payment of "greenmail." The manager generally supports "fair price" provisions
and confidential voting.

CHANGES TO CAPITAL STRUCTURE. The manager will review, on a case-by-case basis,
proposals by companies to increase authorized shares and the purpose for the
increase and proposals seeking preemptive rights. The manager will generally not
vote in favor of dual-class capital structures to increase the number of
authorized shares where that class of stock would have superior voting rights.
The manager will generally vote in favor of the issuance of preferred stock in
cases where the company specifies the voting, dividend, conversion and other
rights of such stock and the terms of the preferred stock issuance are deemed
reasonable.

MERGERS AND CORPORATE RESTRUCTURING. Mergers and acquisitions will be subject to
careful review by the research analyst to determine whether each will be
beneficial to shareholders. The manager will analyze various economic and
strategic factors in making the final decision on a merger or acquisition.
Corporate restructuring and reincorporation proposals are also subject to a
thorough examination on a case-by-case basis.

SOCIAL AND CORPORATE POLICY ISSUES. The manager will generally give management
discretion with regard to social, environmental and ethical issues, although the
manager may vote in favor of those that are believed to have significant
economic benefits or implications for the Fund and its shareholders.

GLOBAL CORPORATE GOVERNANCE. Many of the tenets discussed above are applied to
proxy voting decisions for international companies. However, the manager must be
more flexible in these instances and must be mindful of the varied market
practices of each region.

The manager will attempt to process every proxy it receives for all domestic and
foreign issuers. However, there may be situations in which the manager cannot
process proxies, for example, where a meeting notice was received too late, or
sell orders preclude the ability to vote. If a security is on loan, the manager
may determine that it is not in the best interests of the Fund to recall the
security for voting purposes. Also, the manager may abstain from voting under
certain circumstances or vote against items such as "Other Business" when the
manager is not given adequate information from the company.

Shareholders may view the complete Policies online at franklintempleton.com.
Alternatively, shareholders may request copies of the Policies free of charge by
calling the Proxy Group collect at 1-954/527-7678 or by sending a written
request to: Franklin Templeton Companies, LLC, 500 East Broward Boulevard, Suite
1500, Fort Lauderdale, FL 33394, Attention: Proxy Group. Copies of the Fund's
proxy voting records are available online at franklintempleton.com and posted on
the SEC website at WWW.SEC.GOV. The proxy voting records are updated each year
by August 31 to reflect the most recent 12-month period ended June 30.

ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANY AND
AFFILIATED PURCHASERS.

(a)(1) As of January 25, 2008, the portfolio managers of the Fund are as
follows:

MARK MOBIUS, PH.D, MANAGING DIRECTOR OF TEMPLETON ASSET MANAGEMENT LTD.

Dr. Mobius has been a manager of the Fund since its inception. He has primary
responsibility for the investments of the Fund. He has final authority over all
aspects of the Fund's investment portfolio, including but not limited to,
purchases and sales of individual securities, portfolio risk assessment, and the
management of daily cash balances in accordance with anticipated management
requirements. The degree to which he may perform these functions, and the nature
of these functions, may change from time to time. He joined Franklin Templeton
Investments in 1987.

DENNIS LIM, CO-CHIEF EXECUTIVE OFFICER AND DIRECTOR OF TEMPLETON ASSET
MANAGEMENT LTD.

Based in Singapore, Mr. Lim has been a manager of the Fund since 2000, providing
research and advice on the purchases and sales of individual securities, and
portfolio risk assessment. He joined Franklin Templeton Investments in 1990.

TOM WU, DIRECTOR OF TEMPLETON ASSET MANAGEMENT LTD.

Based in Hong Kong, Mr. Wu has been a manager of the Fund since its inception,
providing research and advice on the purchases and sales of individual
securities, and portfolio risk assessment. He joined Franklin Templeton
Investments in 1987.

(a)(2) This section reflects information about the portfolio managers as of the
fiscal year ended August 31, 2007.

The following table shows the number of other accounts managed by each portfolio
manager and the total assets in the accounts managed within each category:

-------------------------------------------------------------------------------
NAME NUMBER ASSETS NUMBER ASSETS NUMBER ASSETS
OF OTHER OF OTHER OF OTHER OF OTHER OF OF
REGISTERED REGISTERED POOLED POOLED OTHER OTHER
INVESTMENT INVESTMENT INVESTMENT INVESTMENT ACCOUNTS ACCOUNTS
COMPANIES COMPANIES VEHICLES VEHICLES MANAGED/1 MANAGED
MANAGED MANAGED MANAGED/1 MANAGED (X $1
(X $1 (X $1 MILLION)/1
MILLION) MILLION)/1
-------------------------------------------------------------------------------
Mark
Mobius 7 13,237.3 22 22,366.3 5 2,062.5
-------------------------------------------------------------------------------
Dennis
Lim 4 10,528.1 5 1,636.4 2 589.2
-------------------------------------------------------------------------------

Tom Wu 4 10,528.1 5 2,663.9 2 589.2
------------------------------------------------------------------------------
1. The various pooled investment vehicles and accounts listed are managed by a
team of investment professionals. Accordingly, the individual managers listed
would not be solely responsible for managing such listed amounts.

Portfolio managers that provide investment services to the Fund may also provide
services to a variety of other investment products, including other funds,
institutional accounts and private accounts. The advisory fees for some of such
other products and accounts may be different than that charged to the Fund and
may include performance based compensation. This may result in fees that are
higher (or lower) than the advisory fees paid by the Fund. As a matter of
policy, each fund or account is managed solely for the benefit of the beneficial
owners thereof. As discussed below, the separation of the trading execution
function from the portfolio management function and the application of
objectively based trade allocation procedures helps to mitigate potential
conflicts of interest that may arise as a result of the portfolio managers
managing accounts with different advisory fees.

CONFLICTS. The management of multiple funds, including the Fund, and accounts
may also give rise to potential conflicts of interest if the funds and other
accounts have different objectives, benchmarks, time horizons, and fees as the
portfolio manager must allocate his or her time and investment ideas across
multiple funds and accounts. The manager seeks to manage such competing
interests for the time and attention of portfolio managers by having portfolio
managers focus on a particular investment discipline. Most other accounts
managed by a portfolio manager are managed using the same investment strategies
that are used in connection with the management of the Fund. Accordingly,
portfolio holdings, position sizes, and industry and sector exposures tend to be
similar across similar portfolios, which may minimize the potential for
conflicts of interest. As noted above, the separate management of the trade
execution and valuation functions from the portfolio management process also
helps to reduce potential conflicts of interest. However, securities selected
for funds or accounts other than the Fund may outperform the securities selected
for the Fund. Moreover, if a portfolio manager identifies a limited investment
opportunity that may be suitable for more than one fund or other account, the
Fund may not be able to take full advantage of that opportunity due to an
allocation of that opportunity across all eligible funds and other accounts. The
manager seeks to manage such potential conflicts by using procedures intended to
provide a fair allocation of buy and sell opportunities among funds and other
accounts.

The structure of a portfolio manager's compensation may give rise to potential
conflicts of interest. A portfolio manager's base pay and bonus tend to increase
with additional and more complex responsibilities that include increased assets
under management. As such, there may be an indirect relationship between a
portfolio manager's marketing or sales efforts and his or her bonus.

Finally, the management of personal accounts by a portfolio manager may give
rise to potential conflicts of interest. While the funds and the manager have
adopted a code of ethics which they believe contains provisions reasonably
necessary to prevent a wide range of prohibited activities by portfolio managers
and others with respect to their personal trading activities, there can be no
assurance that the code of ethics addresses all individual conduct that could
result in conflicts of interest.

The manager and the Fund have adopted certain compliance procedures that are
designed to address these, and other, types of conflicts. However, there is no
guarantee that such procedures will detect each and every situation where a
conflict arises.

COMPENSATION. The manager seeks to maintain a compensation program that is
competitively positioned to attract, retain and motivate top-quality investment
professionals. Portfolio managers receive a base salary, a cash incentive bonus
opportunity, an equity compensation opportunity, and a benefits package.
Portfolio manager compensation is reviewed annually and the level of
compensation is based on individual performance, the salary range for a
portfolio manager's level of responsibility and Franklin Templeton guidelines.
Portfolio managers are provided no financial incentive to favor one fund or
account over another. Each portfolio manager's compensation consists of the
following three elements:

BASE SALARY Each portfolio manager is paid a base salary.

ANNUAL BONUS Annual bonuses are structured to align the interests of
the portfolio manager with those of the Fund's shareholders. Each
portfolio manager is eligible to receive an annual bonus. Bonuses
generally are split between cash (50% to 65%) and restricted shares of
a Franklin Templeton fund which vest over a three-year period (17.5% to
25%) and other mutual fund shares (17.5% to 25%). The deferred
equity-based compensation is intended to build a vested interest of the
portfolio manager in the financial performance of both Franklin
Resources and mutual funds advised by the manager. The bonus plan is
intended to provide a competitive level of annual bonus compensation
that is tied to the portfolio manager achieving consistently strong
investment performance, which aligns the financial incentives of the
portfolio manager and Fund shareholders. The Chief Investment Officer
of the manager and/or other officers of the manager, with
responsibility for the Fund, have discretion in the granting of annual
bonuses to portfolio managers in accordance with Franklin Templeton
guidelines. The following factors are generally used in determining
bonuses under the plan:

|X| INVESTMENT PERFORMANCE. Primary consideration is given to the
historic investment performance over the 1, 3 and 5 preceding
years of all accounts managed by the portfolio manager. The
pre-tax performance of each fund managed is measured relative to a
relevant peer group and/or applicable benchmark as appropriate.

|X| NON-INVESTMENT PERFORMANCE. The more qualitative contributions of
a portfolio manager to the manager's business and the investment
management team, including business knowledge, contribution to
team efforts, mentoring of junior staff, and contribution to the
marketing of the Fund, are evaluated in determining the amount of
any bonus award.

|X| RESEARCH. Where the portfolio management team also has research
responsibilities, each portfolio manager is evaluated on the
number and performance of recommendations over time.

|X| RESPONSIBILITIES. The characteristics and complexity of funds
managed by the portfolio manager are factored in the manager's
appraisal.

ADDITIONAL LONG-TERM EQUITY-BASED COMPENSATION Portfolio managers may
also be awarded restricted shares or units of one or more mutual funds,
and options to purchase common shares of a Franklin Templeton fund.
Awards of such deferred equity-based compensation typically vest over
time, so as to create incentives to retain key talent.

Portfolio managers also participate in benefit plans and programs available
generally to all employees of the manager.

OWNERSHIP OF FUND SHARES. The manager has a policy of encouraging portfolio
managers to invest in the funds they manage. Exceptions arise when, for example,
a fund is closed to new investors or when tax considerations or jurisdictional
constraints cause such an investment to be inappropriate for the portfolio
manager. The following is the dollar range of Fund shares beneficially owned by
each portfolio manager (such amounts may change from time to time):

Dollar Range of Fund
Shares Beneficially
Portfolio Manager Owned
----------------------------------------------------------------------
Mark Mobius None
----------------------------------------------------------------------
Dennis Lim None
----------------------------------------------------------------------
Tom Wu None
----------------------------------------------------------------------

Note: Because the portfolio managers are all foreign nationals, they do not hold
shares in this U.S. registered fund, however they own shares in other similar
Franklin Templeton funds managed by them, registered offshore and appropriate
for foreign nationals.

ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS. N/A

ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

There have been no changes to the procedures by which shareholders may recommend
nominees to the Registrant's Board of Trustees that would require disclosure
herein.

ITEM 11. CONTROLS AND PROCEDURES.

(A) EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES. The Registrant maintains
disclosure controls and procedures that are designed to ensure that information
required to be disclosed in the Registrant's filings under the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 is recorded,
processed, summarized and reported within the periods specified in the rules and
forms of the Securities and Exchange Commission. Such information is accumulated
and communicated to the Registrant's management, including its principal
executive officer and principal financial officer, as appropriate, to allow
timely decisions regarding required disclosure. The Registrant's management,
including the principal executive officer and the principal financial officer,
recognizes that any set of controls and procedures, no matter how well designed
and operated, can provide only reasonable assurance of achieving the desired
control objectives.

Within 90 days prior to the filing date of this Shareholder Report on Form
N-CSR, the Registrant had carried out an evaluation, under the supervision and
with the participation of the Registrant's management, including the
Registrant's principal executive officer and the Registrant's principal
financial officer, of the effectiveness of the design and operation of the
Registrant's disclosure controls and procedures. Based on such evaluation, the
Registrant's principal executive officer and principal financial officer
concluded that the Registrant's disclosure controls and procedures are
effective.

(B) CHANGES IN INTERNAL CONTROLS. There have been no significant changes in the
Registrant's internal controls or in other factors that could significantly
affect the internal controls subsequent to the date of their evaluation in
connection with the preparation of this Shareholder Report on Form N-CSR.

ITEM 12. EXHIBITS.

(a)(1) Code of Ethics

(a)(2) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
of Jimmy D. Gambill, Chief Executive Officer - Finance and Administration, and
Galen G. Vetter, Chief Financial Officer

(b) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of
Jimmy D. Gambill, Chief Executive Officer - Finance and Administration, and
Galen G. Vetter, Chief Financial Officer

SIGNATURES

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.

TEMPLETON EMERGING MARKETS FUND

By /s/JIMMY D. GAMBILL
--------------------
Jimmy D. Gambill
Chief Executive Officer - Finance and Administration
Date: January 24, 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/JIMMY D. GAMBILL
--------------------
Jimmy D. Gambill
Chief Executive Officer - Finance and Administration
Date: January 24, 2008

By /s/GALEN G. VETTER
-------------------
Galen G. Vetter
Chief Financial Officer
Date: January 24, 2008