UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM N-Q QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED MANAGEMENT INVESTMENT COMPANY Investment Company Act File number 811-7083 Name of Fund: MuniYield Arizona Fund, Inc. Fund Address: P.O. Box 9011 Princeton, NJ 08543-9011 Name and address of agent for service: Robert C. Doll, Jr., Chief Executive Officer, MuniYield Arizona Fund, Inc., 800 Scudders Mill Road, Plainsboro, NJ, 08536. Mailing address: P.O. Box 9011, Princeton, NJ, 08543-9011 Registrant's telephone number, including area code: (609) 282-2800 Date of fiscal year end: 10/31/2006 Date of reporting period: 05/01/06 - 07/31/06 Item 1 - Schedule of Investments MuniYield Arizona Fund, Inc. Schedule of Investments as of July 31, 2006 (in Thousands) Face Amount Municipal Bonds Value Arizona - 139.4% $ 1,000 Arizona Educational Loan Marketing Corporation, Educational Loan Revenue Refunding Bonds, AMT, Junior Sub-Series, 6.30% due 12/01/2008 $ 1,009 1,800 Arizona Health Facilities Authority, Hospital System Revenue Bonds (Phoenix Children's Hospital), Series A, 6.125% due 11/15/2022 1,874 1,785 Arizona Health Facilities Authority Revenue Bonds (Catholic Healthcare West), Series A, 6.625% due 7/01/2020 1,965 4,335 Arizona State University Revenue Bonds, DRIVERS, Series 270, 7.024% due 7/01/2021 (e)(k) 5,090 3,285 Arizona Student Loan Acquisition Authority, Student Loan Revenue Refunding Bonds, AMT, Junior Subordinated Series B-1, 6.15% due 5/01/2029 3,483 1,000 Arizona Student Loan Acquisition Authority, Student Loan Revenue Refunding Bonds, AMT, Senior Series A-1, 5.90% due 5/01/2024 1,051 1,000 Arizona Tourism and Sports Authority, Tax Revenue Bonds (Baseball Training Facilities Project), 5% due 7/01/2016 1,016 2,000 Arizona Tourism and Sports Authority, Tax Revenue Bonds (Multi-Purpose Stadium Facility), Series A, 5.375% due 7/01/2023 (b) 2,137 1,000 Cottonwood, Arizona, Senior Lien Water System Revenue Bonds, 5% due 7/01/2035 (h) 1,028 750 Downtown Phoenix Hotel Corporation, Arizona, Revenue Bonds, Senior Series A, 5.25% due 7/01/2025 (e) 798 1,500 Downtown Phoenix Hotel Corporation, Arizona, Revenue Bonds, Senior Series A, 5% due 7/01/2036 (e) 1,536 2,000 Downtown Phoenix Hotel Corporation, Arizona, Revenue Bonds, Sub-Series B, 5% due 7/01/2036 (e) 2,054 750 Gladden Farms Community Facilities District, Arizona, GO, 5.50% due 7/15/2031 750 3,000 Greater Arizona Development Authority, Infrastructure Revenue Bonds, Series B, 5% due 8/01/2030 (b) 3,101 1,670 Maricopa County, Arizona, Hospital Revenue Refunding Bonds (Sun Health Corporation), 6.125% due 4/01/2007 (i) 1,729 735 Maricopa County, Arizona, Hospital Revenue Refunding Bonds (Sun Health Corporation), 6.125% due 4/01/2018 756 900 Maricopa County, Arizona, IDA, Education Revenue Bonds (Arizona Charter Schools Project 1), Series A, 6.625% due 7/01/2020 897 2,400 Maricopa County, Arizona, IDA, Hospital Facility Revenue Refunding Bonds (Samaritan Health Services), Series A, 7% due 12/01/2016 (b)(d) 2,910 Portfolio Abbreviations To simplify the listings of MuniYield Arizona Fund, Inc.'s portfolio holdings in the Schedule of Investments, we have abbreviated the names of many of the securities according to the list below. AMT Alternative Minimum Tax (subject to) COP Certificates of Participation DRIVERS Derivative Inverse Tax-Exempt Receipts GO General Obligation Bonds IDA Industrial Development Authority PCR Pollution Control Revenue Bonds RIB Residual Interest Bonds RITR Residual Interest Trust Receipts S/F Single-Family MuniYield Arizona Fund, Inc. Schedule of Investments as of July 31, 2006 (concluded) (in Thousands) Face Amount Municipal Bonds Value Arizona $ 1,000 Maricopa County, Arizona, Peoria Unified School District Number 11, GO, Second (concluded) Series, 5% due 7/01/2025 (e) $ 1,042 1,485 Maricopa County, Arizona, Pollution Control Corporation, PCR, Refunding (Public Service Company of New Mexico Project), Series A, 6.30% due 12/01/2026 1,530 2,250 Maricopa County, Arizona, Public Finance Corporation, Lease Revenue Bonds, RIB, Series 511X, 7.09% due 7/01/2014 (a)(k) 2,567 1,825 Maricopa County, Arizona, Scottsdale Unified School District Number 48, GO, 6.60% due 7/01/2012 2,085 500 Maricopa County, Arizona, Tempe Elementary Unified School District Number 3, GO, Refunding, 7.50% due 7/01/2010 (e) 566 1,000 Maricopa County, Arizona, Unified School District Number 090, School Improvement, GO (Saddle Mountain), Series A, 5% due 7/01/2014 1,022 1,000 Mesa, Arizona, IDA Revenue Bonds (Discovery Health Systems), Series A, 5.625% due 1/01/2010 (b)(i) 1,065 1,000 Nogales, Arizona, Municipal Development Authority, Inc., Revenue Bonds, 5% due 6/01/2030 (a) 1,031 4,500 Northern Arizona University System Revenue Bonds, 5.50% due 6/01/2034 (e) 4,834 3,325 Phoenix, Arizona, Civic Improvement Corporation, Excise Tax Revenue Bonds (Civic Plaza Expansion Project), Sub-Series A, 5% due 7/01/2035 (e) 3,431 500 Phoenix, Arizona, Civic Improvement Corporation, Senior Lien Airport Revenue Bonds, AMT, Series B, 5.25% due 7/01/2032 (e) 513 2,500 Phoenix, Arizona, Civic Improvement Corporation, Water System Revenue Refunding Bonds, Junior Lien, 5.50% due 7/01/2020 (e) 2,683 2,000 Phoenix, Arizona, Civic Improvement Corporation, Water System Revenue Refunding Bonds, Junior Lien, 5% due 7/01/2029 (b) 2,073 750 Pima County, Arizona, IDA, Education Revenue Bonds (Arizona Charter Schools Project), Series C, 6.70% due 7/01/2021 787 1,000 Pima County, Arizona, IDA, Education Revenue Bonds (Arizona Charter Schools Project), Series C, 6.75% due 7/01/2031 1,041 985 Pima County, Arizona, IDA, Education Revenue Refunding Bonds (Arizona Charter Schools Project II), Series A, 6.75% due 7/01/2021 1,036 1,000 Pima County, Arizona, IDA, Revenue Refunding Bonds (Health Partners), Series A, 5.625% due 4/01/2014 (b) 1,030 3,050 Pima County, Arizona, Unified School District Number 1, Tucson, GO, Refunding, 7.50% due 7/01/2009 (e) 3,356 1,250 Pinal County, Arizona, COP, 5% due 12/01/2026 1,272 1,250 Pinal County, Arizona, COP, 5% due 12/01/2029 1,269 1,000 Pinal County, Arizona, IDA, Correctional Facilities Contract Revenue Bonds (Florence West Prison Project), Series A, 5.25% due 10/01/2023 (c) 1,035 500 Pinal County, Arizona, IDA, Wastewater Revenue Bonds (San Manuel Facilities Project), AMT, 6.25% due 6/01/2026 537 2,500 Salt River Project, Arizona, Agriculture Improvement and Power District, Electric System Revenue Refunding Bonds, Series A, 5% due 1/01/2035 2,589 2,250 Scottsdale, Arizona, IDA, Hospital Revenue Bonds (Scottsdale Healthcare), 5.80% due 12/01/2011 (i) 2,471 1,000 Scottsdale, Arizona, Municipal Property Corporation, Excise Tax Revenue Bonds, 5% due 7/01/2029 1,039 1,500 Scottsdale, Arizona, Municipal Property Corporation, Excise Tax Revenue Bonds, 5% due 7/01/2030 1,559 1,195 Show Low, Arizona, IDA, Hospital Revenue Bonds (Navapache Regional Medical Center), 5% due 12/01/2035 (j) 1,214 1,500 South Campus Group LLC, Arizona Student Housing Revenue Bonds (Arizona State University South Campus Project), Series 2003, 5.625% due 9/01/2035 (b) 1,618 340 Tucson and Pima County, Arizona, IDA, S/F Mortgage Revenue Refunding Bonds (Mortgage-Backed Securities Program), AMT, Series A-1, 6% due 7/01/2021 (f)(g) 342 1,000 Tucson, Arizona, IDA, Senior Living Facilities Revenue Bonds (Christian Care Tucson Inc. Project), Series A, 6.125% due 7/01/2024 (j) 1,077 1,105 University of Arizona, COP, Refunding, Series A, 5.125% due 6/01/2029 (a) 1,144 2,000 University of Arizona, COP, Series B, 5% due 6/01/2028 (a) 2,050 1,275 Vistancia Community Facilities District, Arizona, GO, 6.75% due 7/15/2022 1,365 750 Vistancia Community Facilities District, Arizona, GO, 5.75% due 7/15/2024 767 500 Watson Road Community Facilities District, Arizona, Special Assessment Revenue Bonds, 6% due 7/01/2030 516 2,000 Yavapai County, Arizona, IDA, Hospital Facility Revenue Bonds (Yavapai Regional Medical Center), Series A, 6% due 8/01/2033 2,127 Guam - 1.6% 1,000 Guam Government Waterworks Authority, Water and Wastewater System, Revenue Refunding Bonds, 5.875% due 7/01/2035 1,044 Puerto Rico - 19.8% 500 Puerto Rico Commonwealth, GO, Refunding, RITR, Class R, Series 3, 7.503% due 7/01/2016 (b)(k) 570 1,700 Puerto Rico Commonwealth Highway and Transportation Authority, Transportation Revenue Bonds, Series G, 5% due 7/01/2033 1,713 2,000 Puerto Rico Commonwealth, Public Improvement, GO, Series A, 5.125% due 7/01/2031 2,025 1,000 Puerto Rico Electric Power Authority, Power Revenue Bonds, Series II, 5.25% due 7/01/2031 1,034 1,500 Puerto Rico Electric Power Authority, Power Revenue Bonds, Series NN, 5.125% due 7/01/2029 1,540 1,000 Puerto Rico Electric Power Authority, Power Revenue Bonds, Series NN, 5% due 7/01/2032 (b) 1,031 1,500 Puerto Rico Industrial, Tourist, Educational, Medical and Environmental Control Facilities Revenue Bonds (Cogeneration Facility-AES Puerto Rico Project), AMT, 6.625% due 6/01/2026 1,631 2,000 Puerto Rico Public Buildings Authority, Government Facilities Revenue Refunding Bonds, Series I, 5.25% due 7/01/2033 2,067 1,000 Puerto Rico Public Finance Corporation, Commonwealth Appropriation Revenue Bonds, Series E, 5.50% due 8/01/2029 1,046 Total Municipal Bonds (Cost - $99,433) - 160.8% 102,568 Shares Held Short-Term Securities 1,504 CMA Arizona Municipal Money Fund, 2.96% (l)(m) 1,504 Total Short-Term Securities (Cost - $1,504) - 2.4% 1,504 Total Investments (Cost - $100,938*) - 163.2% 104,072 Other Assets Less Liabilities - 0.0% 21 Preferred Stock, at Redemption Value - (63.2%) (40,322) ----------- Net Assets Applicable to Common Stock - 100.0% $ 63,771 =========== * The cost and unrealized appreciation (depreciation) of investments as of July 31, 2006, as computed for federal income tax purposes, were as follows: Aggregate cost $ 100,946 ================== Gross unrealized appreciation $ 3,289 Gross unrealized depreciation (163) ------------------ Net unrealized appreciation $ 3,126 ================== (a) AMBAC Insured. (b) MBIA Insured. (c) ACA Insured. (d) Escrowed to maturity. (e) FGIC Insured. (f) FHLMC Collateralized. (g) FNMA/GNMA Collateralized. (h) XL Capital Insured. (i) Prerefunded. (j) Radian Insured. (k) The rate disclosed is that currently in effect. This rate changes periodically and inversely based upon prevailing market rates. (l) Investments in companies considered to be an affiliate of the Fund, for purposes of Section 2(a)(3) of the Investment Company Act of 1940, were as follows: Net Dividend Affiliate Activity Income CMA Arizona Municipal Money Fund $ (103) $ 17 (m) Represents the current yield as of July 31, 2006. Item 2 - Controls and Procedures 2(a) - The registrant's certifying officers have reasonably designed such disclosure controls and procedures to ensure material information relating to the registrant is made known to us by others particularly during the period in which this report is being prepared. The registrant's certifying officers have determined that the registrant's disclosure controls and procedures are effective based on our evaluation of these controls and procedures as of a date within 90 days prior to the filing date of this report. 2(b) - There were no changes in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Act (17 CFR 270.30a-3(d)) that occurred during the last fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. Item 3 - Exhibits Certifications - Attached hereto Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. MuniYield Arizona Fund, Inc. By: /s/ Robert C. Doll, Jr. ----------------------- Robert C. Doll, Jr. Chief Executive Officer MuniYield Arizona Fund, Inc. Date: September 20, 2006 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/ Robert C. Doll, Jr. ----------------------- Robert C. Doll, Jr. Chief Executive Officer MuniYield Arizona Fund, Inc. Date: September 20, 2006 By: /s/ Donald C. Burke ----------------------- Donald C. Burke Chief Financial Officer MuniYield Arizona Fund, Inc. Date: September 20, 2006