The schooner Albion, of Nassau, N. P., formerly the Lucy R. Waring, of Baltimore, Md., arrived at New York, a prize to the U. S. gunboat Pengain, which captured her while attempting to run the blockade of Charleston. She was laden with arms, ammunition, salt, fruit, provisions, oils, tin, copper, saddles, bridles, and cavalry equipments, and valued at one hundred thousand dollars. On the morning of the 25th ult., she was observed endeavoring to work into the inlet near Edisto Island, and after a chase of three hours was overhauled and captured. The schooner was in command of Captains Christy and Stevens, who admitted that they were residents of Savannah, Ga. They were also part owners of the vessel. The captains and crew were put on board the U. S. steamer Penguin. Master's mate George N. Hood was put on board the Albion with a prize crew, and ordered to proceed North.
This morning, a party of Union men from Whitley County, Ky., headed by George W. Lyttle, marched into the town of Huntsville, Tennessee, after having travelled through the night from Williamsburg, Ky., a distance of near fifty miles, and about twenty-five miles  into the Southern Confederacy; tore down the flag of rebellion, erected the Stars and Stripes, and captured five rebel troops, and bore them in triumph to Camp Calvert, with a number of good horses and rigging, also some splendid fire-arms, knives, &c.1 Those composing the little patriotic band, were R. Bird, Speed Faris, Samuel Freeman, J. W. Smith, Clint. Roe, Ples. Jones, Joe Cain, S. C. Cain, Wm. Ellison, Frank and Abel Bryant, G. W. Lyttle, S. Stanfield, Jeremiah Meadors, R. and J. Pemberton, and some others, making between twenty and thirty in number.--Frankfort Commonwealth (Ky.), Dec. 9.
A party of Unionists attacked the Confederate pickets at Morristown, East Tennessee, killing a large number of them, and putting the rest to flight.--Memphis Avalanche, Dec. 2.
Simon Cameron, the Secretary of War, in his report, proposed that the limits of Virginia be so altered, as to make her boundaries consist of the Blue Ridge on the east, and Pennsylvania on the north, leaving those on the south and west as at present. Thus Alleghany and Washington counties, of Maryland, would be transferred to Virginia, while all that portion of Virginia lying between the Blue Ridge and Chesapeake Bay, could be added to Maryland, and that portion of the peninsula between the Chesapeake and the Atlantic, could be incorporated into the States of Delaware.