Unassociated Document



 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED MANAGEMENT INVESTMENT COMPANY
 
Investment Company Act file number 811-21153
 
Nuveen Maryland Dividend Advantage Municipal Fund 3
(Exact name of registrant as specified in charter)
 
Nuveen Investments
        333 West Wacker Drive, Chicago, Illinois 60606         
(Address of principal executive offices) (Zip code)
 

Kevin J. McCarthy
Vice President and Secretary
        333 West Wacker Drive, Chicago, Illinois 60606         
(Name and address of agent for service)
 
Registrant's telephone number, including area code:         312-917-7700        
 
Date of fiscal year end:            5/31          
 
Date of reporting period:         8/31/10         
 
Form N-Q is to be used by management investment companies, other than small business investment companies registered on Form N-5 (§§ 239.24 and 274.5 of this chapter), to file reports with the Commission, not later than 60 days after the close of the first and third fiscal quarters, pursuant to rule 30b1-5 under the Investment Company Act of 1940 (17 CFR 270.30b1-5). The Commission may use the information provided on Form N-Q in its regulatory, disclosure review, inspection, and policymaking roles.
 
A registrant is required to disclose the information specified by Form N-Q, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-Q unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to the Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.

 
 
 
 
Item 1. Schedule of Investments
 

           
   
Portfolio of Investments (Unaudited)
      
   
   Nuveen Maryland Dividend Advantage Municipal Fund 3 (NWI)
      
   
   August 31, 2010
      
Principal
    
Optional Call
    
Amount (000)
  
Description (1)
Provisions (2)
Ratings (3)
Value
   
Consumer Discretionary – 3.8% (2.6% of Total Investments)
      
$    2,385 
  
Baltimore, Maryland, Senior Lien Convention Center Hotel Revenue Bonds, Series 2006A, 5.250%, 
9/16 at 100.00 
Baa3 
$   2,183,229 
   
9/01/39 – SYNCORA GTY Insured 
      
380 
  
Baltimore, Maryland, Subordinate Lien Convention Center Hotel Revenue Bonds, Series 2006B, 
9/16 at 100.00 
Ba1 
362,539 
   
5.875%, 9/01/39 
      
700 
  
Maryland Economic Development Corporation, Revenue Bonds, Chesapeake Bay Hyatt Conference 
12/16 at 100.00 
N/R 
527,254 
   
Center, Series 2006A, 5.000%, 12/01/31 
      
3,465 
  
Total Consumer Discretionary 
    
3,073,022 
   
Consumer Staples – 2.8% (1.9% of Total Investments)
      
2,280 
  
Puerto Rico, The Children’s Trust Fund, Tobacco Settlement Asset-Backed Refunding Bonds, 
5/12 at 100.00 
BBB 
2,269,444 
   
Series 2002, 5.375%, 5/15/33 
      
   
Education and Civic Organizations – 13.0% (8.9% of Total Investments)
      
225 
  
Anne Arundel County, Maryland, Economic Development Revenue Bonds, Community College 
9/12 at 102.00 
A2 
234,907 
   
Project, Series 2002, 5.125%, 9/01/22 
      
625 
  
Frederick County, Maryland, Educational Facilities Revenue Bonds, Mount Saint Mary’s College, 
9/16 at 100.00 
BBB– 
624,563 
   
Series 2006, 5.625%, 9/01/38 
      
690 
  
Hartford County, Maryland, Economic Development Revenue Bonds, Battelle Memorial Institute, 
4/14 at 100.00 
A+ 
699,405 
   
Series 2004, 5.250%, 4/01/34 
      
165 
  
Maryland Health and HIgher Edcuational Facilities Authority, Revenue Bonds, Patterson Park 
7/20 at 100.00 
BBB– 
171,282 
   
Public Charter School Issue, Series 2010, 6.000%, 7/01/40 
      
625 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Goucher College, 
7/14 at 100.00 
A– 
633,738 
   
Series 2004, 5.125%, 7/01/34 
      
1,000 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Johns Hopkins 
7/12 at 100.00 
AA 
1,057,150 
   
University, Series 2002A, 5.000%, 7/01/32 
      
735 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Johns Hopkins 
No Opt. Call 
AA 
857,047 
   
University, Series 2004, Inverse 1003, 13.147%, 1/01/13 (IF) 
      
925 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Maryland Institute 
6/16 at 100.00 
Baa1 
935,286 
   
College of Art, Series 2006, 5.000%, 6/01/30 
      
625 
  
Maryland Industrial Development Financing Authority, Revenue Bonds, Our Lady of Good Counsel 
5/15 at 100.00 
N/R 
626,700 
   
High School, Series 2005A, 6.000%, 5/01/35 
      
710 
  
Montgomery County Revenue Authority, Maryland, Lease Revenue Bonds, Montgomery College 
5/15 at 100.00 
Aa3 
792,978 
   
Arts Center Project, Series 2005A, 5.000%, 5/01/18 
      
1,000 
  
Morgan State University, Maryland, Student Tuition and Fee Revenue Bonds, Academic Fees and 
7/13 at 100.00 
Aa3 
1,023,250 
   
Auxiliary Facilities, Series 2003A, 5.000%, 7/01/32 – FGIC Insured 
      
985 
  
University of Maryland, Auxiliary Facility and Tuition Revenue Bonds, Series 2001B, 
4/11 at 100.00 
AA+ 
1,010,541 
   
4.625%, 4/01/21 
      
800 
  
University of Maryland, Auxiliary Facility and Tuition Revenue Bonds, Series 2006A, 
10/16 at 100.00 
AA+ 
913,656 
   
5.000%, 10/01/22 
      
890 
  
Westminster, Maryland, Educational Facilities Revenue Bonds, McDaniel College, Series 2006, 
11/16 at 100.00 
BBB+ 
899,817 
   
5.000%, 11/01/31 
      
10,000 
  
Total Education and Civic Organizations 
    
10,480,320 
   
Health Care – 28.9% (19.7% of Total Investments)
      
445 
  
Maryland Health and Higher Education Facilities Authority, Revenue Bonds, University of 
7/19 at 100.00 
A 
463,743 
   
Maryland Medical System Issue, Series 2010, 5.125%, 7/01/39 
      
700 
  
Maryland Health and Higher Education Facilities Authority, Revenue Bonds, University of 
7/16 at 100.00 
A 
718,459 
   
Maryland Medical System, Series 2006, 5.000%, 7/01/31 
      
300 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds Doctors Community 
No Opt. Call 
Baa3 
301,089 
   
Hospital, Refunding Series 2010, 5.750%, 7/01/38 
      
335 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Anne Arundel 
7/19 at 100.00 
A– 
347,325 
   
Health System, Series 2010, 5.000%, 7/01/40 
      
1,000 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Anne Arundel 
1/11 at 100.00 
AAA 
1,000,940 
   
Medical Center, Series 1998, 5.125%, 7/01/33 – AGM Insured 
      
775 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Calvert Memorial 
7/14 at 100.00 
A3 
803,613 
   
Hospital, Series 2004, 5.500%, 7/01/36 
      
1,250 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Carroll County 
7/12 at 100.00 
A3 
1,277,100 
   
General Hospital, Series 2002, 5.800%, 7/01/32 
      
1,750 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Carroll Hospital 
7/16 at 100.00 
A3 
1,765,733 
   
Center, Series 2006, 5.000%, 7/01/40 
      
1,070 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Civista Medical 
7/14 at 100.00 
N/R 
914,187 
   
Center, Series 2005, 5.000%, 7/01/37 – RAAI Insured 
      
885 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Doctors Community 
7/17 at 100.00 
Baa3 
872,203 
   
Hospital, Series 2007A, 5.000%, 7/01/29 
      
700 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Frederick Memorial 
7/12 at 100.00 
Baa1 
695,569 
   
Hospital, Series 2002, 5.125%, 7/01/35 
      
800 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Greater Baltimore 
7/11 at 100.00 
A+ 
802,408 
   
Medical Center, Series 2001, 5.000%, 7/01/34 
      
1,000 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Johns Hopkins 
5/11 at 100.00 
Aa3 
1,012,550 
   
Hospital, Series 2001, 5.000%, 5/15/21 
      
1,000 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Kennedy Krieger 
7/13 at 100.00 
Baa3 
1,005,380 
   
Institute, Series 2003, 5.500%, 7/01/33 
      
595 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, LifeBridge Health 
7/17 at 100.00 
AAA 
636,662 
   
System, Series 2008, 5.000%, 7/01/28 – AGC Insured 
      
900 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, MedStar Health, 
8/14 at 100.00 
A2 
942,498 
   
Series 2004, 5.375%, 8/15/24 
      
1,690 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, MedStar Health, 
5/16 at 100.00 
AA+ 
1,749,944 
   
Series 2007, 5.250%, 5/15/46 – BHAC Insured 
      
   
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Mercy Medical 
      
   
Center Project, Series 2007A: 
      
525 
  
5.000%, 7/01/37 
7/17 at 100.00 
BBB 
506,184 
340 
  
5.500%, 7/01/42 
7/17 at 100.00 
BBB 
342,859 
650 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Mercy Medical 
7/11 at 100.00 
BBB 
652,542 
   
Center, Series 2001, 5.625%, 7/01/31 
      
850 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Peninsula Regional 
7/16 at 100.00 
A 
876,376 
   
Medical Center, Series 2006, 5.000%, 7/01/36 
      
1,000 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, The Johns Hopkins 
5/20 at 100.00 
Aa3 
1,059,890 
   
Health System Obligated Group Issue, Series 2010, 5.000%, 5/15/40 
      
1,845 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Union Hospital of 
7/12 at 100.00 
A3 
1,876,789 
   
Cecil County, Series 2002, 5.625%, 7/01/32 
      
1,220 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Washington County 
1/18 at 100.00 
BBB– 
1,248,438 
   
Hospital, Series 2008, 5.750%, 1/01/38 
      
775 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Refunding Bonds, 
1/13 at 101.00 
Baa2 
793,298 
   
Adventist Healthcare, Series 2003A, 5.750%, 1/01/25 
      
900 
  
Prince George’s County, Maryland, Revenue Bonds, Dimensions Health Corporation, Series 1994, 
1/11 at 100.00 
B3 
624,600 
   
5.300%, 7/01/24 (4) 
      
23,300 
  
Total Health Care 
    
23,290,379 
   
Housing/Multifamily – 7.6% (5.2% of Total Investments)
      
980 
  
Maryland Community Development Administration, Housing Revenue Bonds, Series 2002B, 4.950%, 
7/12 at 100.00 
Aa2 
983,597 
   
7/01/32 (Alternative Minimum Tax) 
      
1,250 
  
Maryland Economic Development Corporation, Senior Lien Student Housing Revenue Bonds, 
10/13 at 100.00 
B3 
957,125 
   
University of Maryland – Baltimore, Series 2003A, 5.625%, 10/01/23 
      
   
Maryland Economic Development Corporation, Student Housing Revenue Bonds, Sheppard Pratt 
      
   
University Village, Series 2001: 
      
20 
  
5.875%, 7/01/21 – ACA Insured 
7/11 at 101.00 
N/R 
19,368 
150 
  
6.000%, 7/01/33 – ACA Insured 
7/11 at 101.00 
N/R 
136,493 
475 
  
Maryland Economic Development Corporation, Student Housing Revenue Refunding Bonds, 
6/16 at 100.00 
Baa2 
473,043 
   
University of Maryland College Park Projects, Series 2006, 5.000%, 6/01/33 – CIFG Insured 
      
   
Montgomery County Housing Opportunities Commission, Maryland, Multifamily Housing 
      
   
Development Bonds, Series 2002B: 
      
515 
  
5.100%, 7/01/33 (Alternative Minimum Tax) 
7/12 at 100.00 
Aaa 
517,915 
3,000 
  
5.200%, 7/01/44 (Alternative Minimum Tax) 
7/12 at 100.00 
Aaa 
3,016,440 
6,390 
  
Total Housing/Multifamily 
    
6,103,981 
   
Housing/Single Family – 7.7% (5.2% of Total Investments)
      
1,280 
  
Maryland Community Development Administration Department of Housing and Community 
9/18 at 100.00 
Aa2 
1,363,392 
   
Development, Residential Revenue Bonds, Series 2008C, 5.375%, 9/01/39 
      
   
Maryland Community Development Administration, Department of Housing and Community 
      
   
Development, Residential Revenue Bonds, Series 2006: 
      
1,200 
  
4.875%, 9/01/26 (Alternative Minimum Tax) (UB) 
3/16 at 100.00 
Aa2 
1,221,708 
595 
  
4.900%, 9/01/26 (Alternative Minimum Tax) (UB) 
9/15 at 100.00 
Aa2 
605,097 
815 
  
4.900%, 9/01/31 (Alternative Minimum Tax) (UB) 
9/16 at 100.00 
Aa2 
829,833 
   
Maryland Community Development Administration, Department of Housing and Community 
      
   
Development, Residential Revenue Bonds, Series 2007: 
      
350 
  
5.000%, 9/01/27 (Alternative Minimum Tax) (UB) 
3/17 at 100.00 
Aa2 
358,974 
620 
  
4.850%, 9/01/37 (Alternative Minimum Tax) (UB) 
3/17 at 100.00 
Aa2 
624,464 
1,160 
  
Maryland Community Development Administration, Department of Housing and Community 
9/14 at 100.00 
Aa2 
1,164,048 
   
Development, Residential Revenue Bonds, Series 2005, 4.900%, 9/01/36 (Alternative 
      
   
Minimum Tax) (UB) 
      
6,020 
  
Total Housing/Single Family 
    
6,167,516 
   
Industrials – 3.3% (2.3% of Total Investments)
      
1,090 
  
Maryland Economic Development Corporation, Economic Development Revenue Bonds, 
6/20 at 100.00 
Baa3 
1,144,653 
   
Transportation Facilities Project, Series 2010A, 5.750%, 6/01/35 
      
510 
  
Maryland Economic Development Corporation, Solid Waste Disposal Revenue Bonds, Waste 
4/12 at 101.00 
BBB 
518,175 
   
Management Inc., Series 2002, 4.600%, 4/01/16 (Alternative Minimum Tax) 
      
1,000 
  
Northeast Maryland Waste Disposal Authority, Baltimore, Resource Recovery Revenue Bonds, 
1/11 at 100.00 
BBB 
1,007,150 
   
RESCO Retrofit Project, Series 1998, 4.750%, 1/01/12 (Alternative Minimum Tax) 
      
2,600 
  
Total Industrials 
    
2,669,978 
   
Long-Term Care – 3.8% (2.6% of Total Investments)
      
1,050 
  
Baltimore County, Maryland, Revenue Bonds, Oak Crest Village, Series 2007A, 5.000%, 1/01/37 
1/17 at 100.00 
BBB+ 
991,263 
380 
  
Gaithersburg, Maryland, Economic Development Revenue Bonds, Asbury Methodist Homes Inc., 
1/20 at 100.00 
N/R 
408,622 
   
Series 2009B, 6.000%, 1/01/23 
      
400 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Edenwald, Series 
7/16 at 100.00 
N/R 
390,328 
   
2006A, 5.400%, 1/01/31 
      
   
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, King Farm 
      
   
Presbyterian Community, Series 2007A: 
      
280 
  
5.000%, 1/01/17 
No Opt. Call 
N/R 
263,575 
520 
  
5.250%, 1/01/27 
1/17 at 100.00 
N/R 
447,153 
540 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Mercy Ridge 
7/17 at 100.00 
A– 
526,424 
   
Retirement Community, Series 2007, 4.750%, 7/01/34 
      
3,170 
  
Total-Long Term Care 
    
3,027,365 
   
Tax Obligation/General – 16.5% (11.2% of Total Investments)
      
1,000 
  
Annapolis, Maryland, General Obligation Public Improvement Refunding Bonds, Series 2002, 
4/12 at 101.00 
Aa1 
1,053,490 
   
4.375%, 4/01/17 
      
380 
  
Carroll County, Maryland, Consolidated Public Improvement Bonds, Series 2005A, 5.000%, 12/01/16 
12/15 at 100.00 
AA+ 
451,356 
1,260 
  
Charles County, Maryland, Consolidated General Obligation Public Improvement Bonds, Series 
1/12 at 101.00 
Aa1 
1,344,193 
   
2002, 4.400%, 1/15/16 
      
710 
  
Frederick, Maryland, General Obligation Bonds, Series 2005, 5.000%, 8/01/16 – NPFG Insured 
8/15 at 100.00 
AA 
833,902 
1,000 
  
Maryland National Capital Park Planning Commission, Prince George’s County, General Obligation 
1/14 at 100.00 
AAA 
1,132,200 
   
Bonds, Park Acquisition and Development, Series 2004EE-2, 5.000%, 1/15/17 
      
1,850 
  
Montgomery County, Maryland, Consolidated General Obligation Public Improvement Bonds, Series 
No Opt. Call 
AAA 
2,201,667 
   
2005A, 5.000%, 7/01/15 
      
1,440 
  
Montgomery County, Maryland, Consolidated General Obligation Public Improvement Bonds, Series 
No Opt. Call 
AAA 
1,734,682 
   
2006A, 5.000%, 5/01/16 
      
1,000 
  
Prince George’s County, Maryland, General Obligation Consolidated Public Improvement Bonds, 
No Opt. Call 
AAA 
1,060,130 
   
Series 2004C, 5.000%, 12/01/11 
      
1,000 
  
St. Mary’s County, Maryland, General Obligation Hospital Bonds, Series 2002, 5.000%, 10/01/12 
No Opt. Call 
AA 
1,098,090 
1,000 
  
Washington Suburban Sanitary District, Montgomery and Prince George’s Counties, Maryland, 
6/15 at 100.00 
AAA 
1,183,150 
   
Sewerage Disposal Bonds, Series 2005, 5.000%, 6/01/16 
      
1,000 
  
Washington Suburban Sanitary District, Montgomery and Prince George’s Counties, Maryland, 
6/15 at 100.00 
AAA 
1,183,150 
   
Water Supply Bonds, Series 2005, 5.000%, 6/01/16 
      
11,640 
  
Total Tax Obligation/General 
    
13,276,010 
   
Tax Obligation/Limited – 30.7% (20.9% of Total Investments)
      
185 
  
Anne Arundel County, Maryland, Special Obligation Bonds, National Business Park - North 
7/18 at 102.00 
N/R 
189,098 
   
Project, Series 2010, 6.100%, 7/01/40 
      
1,000 
  
Baltimore Board of School Commissioners, Maryland, Revenue Bonds, City Public School System, 
5/13 at 100.00 
AA+ 
1,119,470 
   
Series 2003A, 5.000%, 5/01/15 
      
135 
  
Frederick County, Maryland, Lake Linganore Village Community Development Special Obligation 
7/12 at 100.00 
N/R 
136,322 
   
Bonds, Series 2001A, 5.600%, 7/01/20 – RAAI Insured 
      
450 
  
Hyattsville, Maryland, Special Obligation Bonds, University Town Center Project, Series 2004, 
7/14 at 102.00 
N/R 
435,236 
   
5.750%, 7/01/34 
      
5,000 
  
Maryland Department of Transportation, Consolidated Transportation Revenue Bonds, Series 2002, 
No Opt. Call 
AAA 
6,100,750 
   
5.500%, 2/01/16 
      
2,200 
  
Maryland Economic Development Corporation, Lease Revenue Bonds, Department of Transportation 
6/12 at 100.50 
AAA 
2,331,846 
   
Headquarters Building, Series 2002, 4.750%, 6/01/22 
      
450 
  
Maryland Economic Development Corporation, Lease Revenue Bonds, Montgomery County Town 
9/12 at 100.00 
AA+ 
491,414 
   
Square Parking Garage, Series 2002A, 5.000%, 9/15/13 
      
2,935 
  
Maryland Economic Development Corporation, Lease Revenue Bonds, Montgomery County Wayne 
9/12 at 100.00 
AA+ 
3,178,106 
   
Avenue Parking Project, Series 2002A, 5.250%, 9/15/16 
      
   
Maryland Stadium Authority, Lease Revenue Bonds, Montgomery County Conference Center 
      
   
Facilities, Series 2003: 
      
1,465 
  
5.000%, 6/15/21 
6/13 at 100.00 
AA+ 
1,619,982 
1,620 
  
5.000%, 6/15/23 
6/13 at 100.00 
AA+ 
1,777,772 
1,210 
  
Prince George’s County, Maryland, Special Obligation Bonds, National Harbor Project, Series 
7/15 at 100.00 
N/R 
1,122,650 
   
2005, 5.200%, 7/01/34 
      
575 
  
Prince George’s County, Maryland, Special Tax District Bonds, Victoria Falls Project, Series 
7/13 at 100.00 
N/R 
520,318 
   
2005, 5.250%, 7/01/35 
      
1,200 
  
Puerto Rico Highway and Transportation Authority, Highway Revenue Bonds, Series 2007N, 5.250%, 
No Opt. Call 
A3 
1,312,224 
   
7/01/31 – AMBAC Insured 
      
   
Puerto Rico Public Buildings Authority, Guaranteed Government Facilities Revenue Bonds, 
      
   
Series 2002G: 
      
1,000 
  
5.250%, 7/01/17 
7/12 at 100.00 
A3 
1,030,410 
1,205 
  
5.250%, 7/01/20 
7/12 at 100.00 
A3 
1,230,341 
1,275 
  
5.250%, 7/01/21 
7/12 at 100.00 
A3 
1,297,415 
700 
  
Puerto Rico, Highway Revenue Bonds, Highway and Transportation Authority, Series 2003AA, 
No Opt. Call 
A 
794,451 
   
5.500%, 7/01/19 – NPFG Insured 
      
22,605 
  
Total Tax Obligation/Limited 
    
24,687,805 
   
Transportation – 3.0% (2.1% of Total Investments)
      
2,210 
  
Maryland Transportation Authority, Revenue Bonds, Transportation Facilities Projects, Series 
7/17 at 100.00 
AAA 
2,431,685 
   
2007, 5.000%, 7/01/30 – AGM Insured (UB) 
      
   
U.S. Guaranteed – 18.6% (12.7% of Total Investments) (5)
      
255 
  
Baltimore, Maryland, Wastewater Project Revenue Bonds, Series 2006C, 5.000%, 7/01/31 
7/16 at 100.00 
AA (5) 
307,275 
   
(Pre-refunded 7/01/16) – AMBAC Insured 
      
280 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Collington 
4/11 at 101.00 
N/R (5) 
293,236 
   
Episcopal Life Care Community Inc., Series 2001A, 6.750%, 4/01/23 (Pre-refunded 4/01/11) 
      
285 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Helix Health, 
No Opt. Call 
N/R (5) 
325,530 
   
Series 1997, 5.000%, 7/01/17 – AMBAC Insured (ETM) 
      
725 
  
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, LifeBridge Health 
7/14 at 100.00 
A2 (5) 
840,899 
   
System, Series 2004A, 5.125%, 7/01/34 (Pre-refunded 7/01/14) 
      
680 
  
Maryland Transportation Authority, Revenue Refunding Bonds, Transportation Facilities 
No Opt. Call 
AAA 
801,992 
   
Projects, First Series 1978, 6.800%, 7/01/16 (ETM) 
      
4,860 
  
Prince George’s County Housing Authority, Maryland, GNMA Collateralized Mortgage Revenue 
11/12 at 100.00 
AAA 
5,278,543 
   
Bonds, Fairview and Hillside Projects, Series 2002A, 4.700%, 11/20/22 (Pre-refunded 11/20/12) 
      
3,500 
  
Puerto Rico Infrastructure Financing Authority, Special Obligation Bonds, Series 2000A, 
10/10 at 101.00 
AAA 
3,550,470 
   
5.500%, 10/01/40 (Pre-refunded 10/01/10) 
      
1,000 
  
Puerto Rico Public Finance Corporation, Commonwealth Appropriation Bonds, Series 1998A, 
No Opt. Call 
AAA 
1,171,440 
   
5.125%, 6/01/24 – AMBAC Insured (ETM) 
      
235 
  
Puerto Rico Public Finance Corporation, Commonwealth Appropriation Bonds, Series 2002E, 
2/12 at 100.00 
AAA 
251,825 
   
5.500%, 8/01/29 (Pre-refunded 2/01/12) 
      
2,000 
  
University of Maryland, Auxiliary Facility and Tuition Revenue Bonds, Series 2002A, 5.125%, 
4/12 at 100.00 
AA+ (5) 
2,153,799 
   
4/01/22 (Pre-refunded 4/01/12) 
      
25 
  
Washington Suburban Sanitary District, Montgomery and Prince George’s Counties, Maryland, 
6/11 at 101.00 
AAA 
26,155 
   
General Obligation Construction Bonds, Second Series 2001, 5.000%, 6/01/17 
      
   
(Pre-refunded 6/01/11) 
      
13,845 
  
Total U.S. Guaranteed 
    
15,001,164 
   
Utilities – 1.6% (1.1% of Total Investments)
      
1,250 
  
Maryland Energy Financing Administration, Revenue Bonds, AES Warrior Run Project, Series 1995, 
9/10 at 100.00 
N/R 
1,250,774 
   
7.400%, 9/01/19 (Alternative Minimum Tax) 
      
   
Water and Sewer – 5.2% (3.6% of Total Investments)
      
2,570 
  
Baltimore, Maryland, Revenue Refunding Bonds, Wastewater Projects, Series 2002A, 5.125%, 
7/12 at 100.00 
AA 
2,610,708 
   
7/01/42 – NPFG Insured 
      
345 
  
Baltimore, Maryland, Wastewater Project Revenue Bonds, Series 2006C, 5.000%, 7/01/31 – 
7/16 at 100.00 
AA 
373,493 
   
AMBAC Insured 
      
660 
  
Baltimore, Maryland, Wastewater Project Revenue Bonds, Series 2007D, 5.000%, 7/01/32 – 
7/17 at 100.00 
AA 
701,724 
   
AMBAC Insured 
      
430 
  
Maryland Water Quality Financing Administration, Revolving Loan Fund Revenue Bonds, Series 
No Opt. Call 
AAA 
513,238 
   
2005A, 5.000%, 9/01/15 
      
4,005 
  
Total Water and Sewer 
    
4,199,163 
$   112,780 
  
Total Investments (cost $113,060,986) – 146.5% 
    
117,928,606 
   
Floating Rate Obligations – (5.3)% 
    
(4,255,000)
   
MuniFund Term Preferred Shares, at Liquidation Value – (25.7)% (6) 
    
(20,700,000)
   
Other Assets Less Liabilities – 2.9% 
    
2,355,100 
   
Auction Rate Preferred Shares, at Liquidation Value – (18.4)% (6) 
    
(14,825,000)
   
Net Assets Applicable to Common Shares – 100% 
    
$   80,503,706 
 
 
 
 
 
 
 
 
 

 
Fair Value Measurements
 
 
In determining the value of the Fund’s investments, various inputs are used. These inputs are summarized in the three broad levels listed below:
 
 
  Level 1 – Quoted prices in active markets for identical securities.
 
 
  Level 2 – Other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.).
 
 
  Level 3 – Significant unobservable inputs (including management’s assumptions in determining the fair value of investments).
 
 
The inputs or methodologies used for valuing securities are not an indication of the risk associated with investing in those securities. The following is a summary of the Fund’s fair value measurements as of August 31, 2010:
 
         
 
Level 1
Level 2
Level 3
Total
Investments: 
        
Municipal Bonds 
$ — 
$117,304,006 
$624,600 
$117,928,606 
 
 
The following is a reconciliation of the Fund’s Level 3 investments held at the beginning and end of the measurement period:
 
   
 
Level 3
 
Municipal
 
Bonds
Balance at the beginning of period 
$623,070 
Gains (losses): 
  
  Net realized gains (losses) 
— 
  Net change in unrealized appreciation (depreciation) 
1,219 
Net purchases at cost (sales at proceeds) 
— 
Net discounts (premiums) 
311 
Net transfers in to (out of) at end of period fair value 
— 
Balance at the end of period 
$624,600 
 
 
Income Tax Information
 
 
The following information is presented on an income tax basis. Differences between amounts for financial statement and federal income tax purposes are primarily due to timing differences in recognizing taxable market discount, timing differences in recognizing certain gains and losses on investment transactions and the treatment of investments in inverse floating rate securities reflected as financing transactions, if any. To the extent that differences arise that are permanent in nature, such amounts are reclassified within the capital accounts on the Statement of Assets and Liabilities presented in the annual report, based on their federal tax basis treatment; temporary differences do not require reclassification. Temporary and permanent differences do not impact the net asset value of the Fund.
 
 
At August 31, 2010, the cost of investments was $109,125,432.
 
 
Gross unrealized appreciation and gross unrealized depreciation of investments at August 31, 2010, were as follows:
 
   
Gross unrealized: 
  
  Appreciation 
$ 6,262,099 
  Depreciation 
(1,713,850)
Net unrealized appreciation (depreciation) of investments 
$ 4,548,249 
 
   
(1) 
All percentages shown in the Portfolio of Investments are based on net assets applicable to Common 
 
shares unless otherwise noted. 
(2) 
Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. 
 
There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities 
 
may be subject to periodic principal paydowns. 
(3) 
Ratings: Using the highest of Standard & Poor’s Group (“Standard & Poor’s”), Moody’s Investor Service, Inc. 
 
(“Moody’s”) or Fitch, Inc. (“Fitch”) rating. Ratings below BBB by Standard & Poor’s, Baa by Moody’s or BBB 
 
by Fitch are considered to be below investment grade. Holdings designated N/R are not rated by any of 
 
these national rating agencies. 
(4) 
For fair value measurement disclosure purposes, investment categorized as Level 3. 
(5) 
Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities, 
 
which ensure the timely payment of principal and interest. Such investments are normally considered to 
 
be equivalent to AAA rated securities. 
(6) 
MuniFund Term Preferred Shares and Auction Rate Preferred Shares, at Liquidation Value as a percentage 
 
of Total Investments are 17.5% and 12.6%, respectively. 
N/R 
Not rated. 
(ETM) 
Escrowed to maturity. 
(IF) 
Inverse floating rate investment. 
(UB) 
Underlying bond of an inverse floating rate trust reflected as a financing transaction. 
 
 
 
 
 
Item 2. Controls and Procedures.

a.  
The registrant's principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the "1940 Act") (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of this report that includes the disclosure required by this paragraph, based on their evaluation of the controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rule 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934 (17 CFR 240.13a-15(b) or 240.15d-15(b)).
 
 
b.  
There were no changes in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR 270.30a-3(d)) that occurred during the registrant's last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting.
 
Item 3. Exhibits.

File as exhibits as part of this Form a separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the 1940 Act (17 CFR 270.30a-2(a)), exactly as set forth below: See EX-99 CERT attached hereto.

 
 
 
 
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.
 
(Registrant)  Nuveen Maryland Dividend Advantage Municipal Fund 3 
 
By (Signature and Title)     /s/ Kevin J. McCarthy                    
                                                   Kevin J. McCarthy
                                                   Vice President and Secretary
 
Date         October 29, 2010        
 
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 (Signature and Title)     /s/ Gifford R. Zimmerman                    
                                                    Gifford R. Zimmerman
                                                  Chief Administrative Officer (principal executive officer) 
 
Date         October 29, 2010        
 
By (Signature and Title)     /s/ Stephen D. Foy                              
                                                   Stephen D. Foy
                                                  Vice President and Controller (principal financial officer) 
 
Date         October 29, 2010