Abstract: An insulated wall system for a basement with foundation concrete walls that are nearly adjacently disposed to masonry block or concrete walls. The insulated wall system has a plurality of vertical metal studs with C or U-shaped cross-sections forming a plurality of cavities nearly adjacent to the interior concrete walls. There is also a plurality of fiberglass insulation sections that are frictionally fit in the plurality of cavities and a plurality of fire retardant sheets or skrims of drywall that are attached to the plurality of vertical metal studs thereby holding the plurality of fiberglass insulation sections within the insulated wall system.