in the squadron in the shape of a steamer has a gun of some kind mounted on her, and our vessels pass up and down without molestation.

The vessels now here are the Black Hawk, Benton, Baron de Kalb, Carondelet, Louisville, Cincinnati, Mound City, Lexington, Tyler, Signal, Romeo, Juliet, Forest Rose, Rattler, Marmora; rams Monarch, Queen of the West, Swityerland, Liouness; store shift Sovereign; ordnance vessels Judge Torrence and Great Western; floating smothery Samson; tug-boat Champion, and six small tugs and two mortars, water-logged.

The health of the squadron is improving. The hospital ship is on her way down here.

I have the honor to be, very respectfully, your obedient servant,

DAVID D. PORTER,

Acting Rear-Admiral, Commanding Mississippi Squadron.

[Inclosure Numbers 3.]

UNITED STATES MISSISSIPPI SQUADRON,

Yazoo River, January 3, 1863.

Honorable GIDEON WELLES,

Secretary of the Navy, Washington, D. C.:

SIR: The army has changed its position, which it was obliged to do, owing to the heavy rains. The men have been without shelter for five days, the rain at times coming down in torrents. It was impossible for any army to work under the circumstances. They failed in the first assault only because the supporting division did not come up to this work, and the reserve fired (it is said) int our own men. Could the first division have held the batteries which they took for three minutes longer, our army could have commanded the hills back of Vicksburg. So desperate were the rebels that they fired grape and canister into and through their own retreating men, and mowed them down by the dozens. The point of attack, at one time practicable, was no longer os after the assault of our army. It was rendered impassable by abatis and stockades. It was then determined by General Sherman and myself to attempt the forts on the Yazoo, at Drumgould' Bluff, by a night attack. Ten thousand men were to have been thrown right at the foot of the cliffs, risking the loss of the transports, while all the iron-clads were to open fire on the batteries and try and since them temporarily. The ram Lioness, under Colonel Ellet, was fitted with an apparatus for breaking torpedo wires, and was to go ahead and clear the way. Colonel Ellet was also provided with fifteen torpedoes, to blow up the raft and enable the vessels to get by, if possible. This desperate duty he took upon himself cheerfully, and no doubt would have performed it well had the opportunity occurred.

The details of the expedition were left to me, and it was all ready to start at 3.30 a. m. A dense fog unfortunately set in at midnight and lasted until morning, when it was too late to start. It was so thick that vessels could not move; men could not see each other at 10 paces. The river is too weir for operations in clear weather, much less in a fog. After the fog, there was, in the afternoon, every indication of a long and heavy rain. The general very wisely embarked his whole army, without being disturbed by the enemy, and is now lying 5 miles above Vicksburg, waiting for good weather and for McClernand to take command. The latter arrived before the army left its position, and approved the change. As we left, the rain poured down in torrents, and will continue to do so for some time longer rendering land operations perfectly impracticable. While the army leaders are deciding what to