SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549

                                   FORM 10-Q
(Mark One)

  X  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
-----
     EXCHANGE ACT OF 1934.

For the quarterly period ended June 30, 1998
                               ------------- 
                                      OR

     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
-----
     EXCHANGE ACT OF 1934.

For the transition period from              to             
                               ------------    ------------
Commission file number 0-13357
                       -------

                        BALCOR EQUITY PROPERTIES-XVIII
                       A REAL ESTATE LIMITED PARTNERSHIP
            ------------------------------------------------------
            (Exact name of registrant as specified in its charter)

          Illinois                                      36-3274349    
-------------------------------                     -------------------
(State or other jurisdiction of                      (I.R.S. Employer  
incorporation or organization)                      Identification No.)

2355 Waukegan Rd., Bannockburn, Illinois                   60015    
----------------------------------------            ------------------- 
(Address of principal executive offices)                (Zip Code)

Registrant's telephone number, including area code (847) 267-1600
                                                   --------------
Indicate by  check  mark whether  the  Registrant  (1) has  filed  all  reports
required to be filed by Section 13  or 15(d) of the Securities Exchange Act  of
1934 during  the preceding  12 months  (or  for such  shorter period  that  the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

Yes   X    No     
    -----     -----
<PAGE>
                        BALCOR EQUITY PROPERTIES-XVIII
                       A REAL ESTATE LIMITED PARTNERSHIP
                       (An Illinois Limited Partnership)

                                BALANCE SHEETS
                      June 30, 1998 and December 31, 1997
                                  (Unaudited)

                                    ASSETS

                                                  1998           1997
                                             -------------- --------------
Cash and cash equivalents                    $   1,643,668  $   1,684,046
Accounts and accrued interest receivable             7,400          7,951
                                             -------------- --------------
                                             $   1,651,068  $   1,691,997
                                             ============== ==============


                        LIABILITIES AND PARTNERS' CAPITAL

Accounts payable                             $      20,922  $      15,410
Due to affiliates                                   38,793         28,315
                                             -------------- --------------
     Total liabilities                              59,715         43,725
                                             -------------- --------------
Commitments and contingencies

Limited Partners' capital (52,811
  Interests issued and outstanding)              1,710,778      1,710,778
General Partner's deficit                         (119,425)       (62,506)
                                             -------------- --------------
     Total partners' capital                     1,591,353      1,648,272
                                             -------------- --------------
                                             $   1,651,068  $   1,691,997
                                             ============== ==============
                                                
The accompanying notes are an integral part of the financial statements.
<PAGE>
                        BALCOR EQUITY PROPERTIES-XVIII
                       A REAL ESTATE LIMITED PARTNERSHIP
                       (An Illinois Limited Partnership)

                       STATEMENTS OF INCOME AND EXPENSES
                for the six months ended June 30, 1998 and 1997
                                  (Unaudited)

                                                  1998           1997
                                             -------------- --------------
Income:
  Rental                                                    $     602,642
  Service                                                          11,890
  Interest on short-term investments         $      44,317         65,882
                                             -------------- --------------
    Total income                                    44,317        680,414
                                             -------------- --------------

Expenses:
  Interest on mortgage notes payable                              218,671
  Depreciation                                                    121,902
  Amortization of deferred expenses                                11,324
  Property operating                                              574,437
  Real estate taxes                                                93,493
  Property management fees                                         30,355
  Administrative                                   101,236        124,442
                                             -------------- --------------
    Total expenses                                 101,236      1,174,624
                                             -------------- --------------
Net loss                                     $     (56,919) $    (494,210)
                                             ============== ==============
Net loss allocated to General Partner        $     (56,919) $    (110,961)
                                             ============== ==============
Net loss allocated to Limited Partners               None   $    (383,249)
                                             ============== ==============
Net loss per Limited Partnership Interest
  (52,811 issued and outstanding) - 
  Basic and Diluted                                  None   $       (7.26)
                                             ============== ==============
Distributions to Limited Partners                    None   $   8,463,491
                                             ============== ==============
Distributions per Limited Partnership 
  Interest                                           None   $      160.26
                                             ============== ==============

The accompanying notes are an integral part of the financial statements.
<PAGE>
                        BALCOR EQUITY PROPERTIES-XVIII
                       A REAL ESTATE LIMITED PARTNERSHIP
                       (An Illinois Limited Partnership)

                       STATEMENTS OF INCOME AND EXPENSES
                 for the quarters ended June 30, 1998 and 1997
                                  (Unaudited)

                                                  1998           1997
                                             -------------- --------------
Income:
  Rental                                                    $     290,898
  Service                                                           7,288
  Interest on short-term investments         $      22,105         21,527
                                             -------------- --------------
    Total income                                    22,105        319,713
                                             -------------- --------------

Expenses:
  Interest on mortgage notes payable                              109,199
  Depreciation                                                     60,951
  Amortization of deferred expenses                                 5,662
  Property operating                                              331,744
  Real estate taxes                                                43,441
  Property management fees                                         14,436
  Administrative                                    41,643         68,423
                                             -------------- --------------
    Total expenses                                  41,643        633,856
                                             -------------- --------------
Net loss                                     $     (19,538) $    (314,143)
                                             ============== ==============
Net loss allocated to General Partner        $     (19,538) $     (11,817)
                                             ============== ==============
Net loss allocated to Limited Partners               None   $    (302,326)
                                             ============== ==============
Net loss per Limited Partnership Interest
  (52,811 issued and outstanding) - 
  Basic and Diluted                                  None   $       (5.73)
                                             ============== ==============
Distribution to Limited Partners                     None   $     145,758
                                             ============== ==============
Distribution per Limited Partnership 
  Interest                                           None   $        2.76
                                             ============== ==============

The accompanying notes are an integral part of the financial statements.
<PAGE>
                        BALCOR EQUITY PROPERTIES-XVIII
                       A REAL ESTATE LIMITED PARTNERSHIP
                       (An Illinois Limited Partnership)

                           STATEMENTS OF CASH FLOWS
                for the six months ended June 30, 1998 and 1997
                                  (Unaudited)

                                                  1998           1997
                                             -------------- --------------
Operating activities:
  Net loss                                   $     (56,919) $    (494,210)
  Adjustments to reconcile net loss
    to net cash used in operating activities:
     Depreciation of properties                                   121,902
     Amortization of deferred expenses                             11,324
       Net change in:
         Escrow deposits                                           81,761
         Accounts and accrued interest
           receivable                                  551         94,022
         Note receivable                                           31,878
         Prepaid expenses                                          17,314
         Accounts payable                            5,512        (39,957)
         Due to affiliates                          10,478        (32,362)
         Accrued liabilities                                      (80,272)
         Security deposits                                            419
                                             -------------- --------------
  Net cash used in operating activities            (40,378)      (288,181)
                                             -------------- --------------
Financing activities:
  Distributions to Limited Partners                            (8,463,491)
  Principal payments on mortgage note payable                     (25,549)
                                                            --------------
  Cash used in financing activities                            (8,489,040)
                                             -------------- --------------

Net change in cash and cash equivalents            (40,378)    (8,777,221)
Cash and cash equivalents at beginning
  of period                                      1,684,046     10,272,801
                                             -------------- --------------
Cash and cash equivalents at end of period   $   1,643,668  $   1,495,580
                                             ============== ==============
                                                
The accompanying notes are an integral part of the financial statements.
<PAGE>
                        BALCOR EQUITY PROPERTIES-XVIII
                       A REAL ESTATE LIMITED PARTNERSHIP
                       (An Illinois Limited Partnership)

                         NOTES TO FINANCIAL STATEMENTS


1. Accounting Policies:

(a) The loss allocation  between the Limited Partners  and the General  Partner
has been adjusted for  financial statement purposes in  order that the  capital
account balances more accurately reflect their remaining economic interests  as
provided for in the Partnership Agreement.

(b) In  the  opinion  of  management, all  adjustments  necessary  for  a  fair
presentation have been made to the  accompanying statements for the six  months
and quarter ended June 30, 1998, and  all such adjustments are of a normal  and
recurring nature.

2. Partnership Termination:

The Partnership Agreement provides for the dissolution of the Partnership  upon
the occurrence of certain events, including the disposition of all interests in
real estate.  During 1997,  the Partnership  sold its  remaining property.  The
Partnership has  retained a  portion of  the cash  from the  property sales  to
satisfy obligations  of the  Partnership as  well as  establish a  reserve  for
contingencies. The  timing of  the  termination of  the Partnership  and  final
distribution of cash will depend upon the nature and extent of liabilities  and
contingencies which exist or  may arise. Such  contingencies may include  legal
and other fees  and costs  stemming from litigation  involving the  Partnership
including, but not limited to, the lawsuits discussed in Note 5 of Notes to the
Financial Statements.  Due to  this  litigation, the  Partnership will  not  be
dissolved and reserves will be held by the Partnership until the conclusion  of
all contingencies.  There  can  be no  assurances  as  to the  time  frame  for
conclusion of these contingencies.

3. Interest Expense:

During the six months  ended June 30, 1997,  the Partnership incurred and  paid
interest expense on mortgage note payable of $218,671.

4. Transactions with Affiliates:

Fees and expenses paid and payable by the Partnership to affiliates during  the
six months and quarter ended June 30, 1998 are:

                                               
                                           Paid
                                   -------------------------
                                     Six Months     Quarter    Payable
                                    ------------   ---------  ---------
<PAGE>
   Reimbursement of expenses to
     the General Partner, at cost    $ 9,038       $ 3,662    $ 38,793


5. Contingency:

The Partnership is currently involved  in two lawsuits whereby the  Partnership
and certain affiliates  have been  named as  defendants alleging  substantially
similar claims involving  certain state  securities and  common law  violations
with regard to the property acquisition process of the Partnership, and to  the
adequacy and  accuracy of  disclosures of  information concerning,  as well  as
marketing efforts related to, the offering of the Limited Partnership Interests
of the  Partnership.  The  defendants  continue  to  vigorously  contest  these
actions. A plaintiff  class has  not been certified  in either  action and,  no
determinations of the  merits have been  made. It is  not determinable at  this
time whether  or not  an unfavorable  decision in  either action  would have  a
material adverse  impact on  the  financial position  of the  Partnership.  The
Partnership believes it has meritorious defenses to contest the claims.
<PAGE>
                        BALCOR EQUITY PROPERTIES-XVIII
                       A REAL ESTATE LIMITED PARTNERSHIP
                       (An Illinois Limited Partnership)

                     MANAGEMENT'S DISCUSSION AND ANALYSIS

Balcor  Equity  Properties-XVIII  A   Real  Estate  Limited  Partnership   (the
"Partnership") is a limited partnership formed in 1984 to invest in and operate
income-producing real property. The Partnership raised $52,811,000 through  the
sale of Limited Partnership  Interests and utilized  these proceeds to  acquire
four real property  investments and a  minority joint venture  interest in  one
additional real  property.  As  of  June  30,  1998,  the  Partnership  has  no
properties remaining in its portfolio.

Inasmuch as the management's discussion and analysis below relates primarily to
the time period since the end of the last fiscal year, investors are encouraged
to review the financial statements and the management's discussion and analysis
contained in the annual  report for 1997 for  a more complete understanding  of
the Partnership's financial position.

Operations
----------

Summary of Operations
---------------------

The operations of the Partnership in 1998 consisted primarily of the payment of
administrative expenses which were partially  offset by interest income  earned
on short-term investments. During  July 1997, the  Partnership sold the  Canyon
Pointe Apartments which was generating a loss from operations.  Primarily as  a
result of the sale of the Canyon Pointe Apartments, the Partnership's net  loss
decreased during the six months and quarter ended June 30, 1998 as compared  to
the same periods in 1997. Further discussion of the Partnership's operations is
summarized below.

1998 Compared to 1997
---------------------

Unless otherwise noted, discussions of fluctuations between 1998 and 1997 refer
to both the six months and quarters ended June 30, 1998 and 1997.

As a result of the  sale of the Canyon Pointe  Apartments in July 1997,  rental
and service income,  interest expense on  mortgage notes payable,  depreciation
expense, amortization expense, property operating, real estate tax expense  and
property management fees expense ceased during 1997.

The proceeds from  the October 1996  sale of the  Knollwood Village  Apartments
were not distributed to Limited Partners until January 1997. As a result,   the
Partnership earned higher interest income on short-term investments during  the
six months ended June 30, 1997 as compared to the same period in 1998.

Primarily as a result of lower portfolio management, accounting and bank  fees,
administrative expenses decreased during 1998 as compared to 1997.
<PAGE>
Liquidity and Capital Resources
-------------------------------

The cash position of the Partnership  decreased by approximately $40,000 as  of
June 30,  1998  as  compared  to  December 31,  1997  due  to  the  payment  of
administrative expenses which were partially  offset by interest income  earned
on short-term investments.

The Partnership Agreement provides for the dissolution of the Partnership  upon
the occurrence of certain events, including the disposition of all interests in
real estate.  During 1997,  the Partnership  sold its  remaining property.  The
Partnership has  retained a  portion of  the cash  from the  property sales  to
satisfy obligations  of the  Partnership as  well as  establish a  reserve  for
contingencies. The  timing of  the  termination of  the Partnership  and  final
distribution of cash will depend upon the nature and extent of liabilities  and
contingencies which exist or  may arise. Such  contingencies may include  legal
and other fees  and costs  stemming from litigation  involving the  Partnership
including, but not limited to, the lawsuits discussed in Note 5 of Notes to the
Financial Statements.  Due to  this  litigation, the  Partnership will  not  be
dissolved and reserves will be held by the Partnership until the conclusion  of
all contingencies.  There  can  be no  assurances  as  to the  time  frame  for
conclusion of these contingencies.

To date, Limited Partners have received  distributions of Net Cash Receipts  of
$288.00 and Net Cash Proceeds of $428.26, totaling $716.26 per $1,000 Interest,
as well as certain tax benefits. No additional distributions are anticipated to
be made prior to  termination of the Partnership.  However, after paying  final
partnership expenses, any remaining cash reserves will be distributed.  Limited
Partners will not recover all of their original investment.
<PAGE>
                        BALCOR EQUITY PROPERTIES-XVIII
                       A REAL ESTATE LIMITED PARTNERSHIP
                       (An Illinois Limited Partnership)

                          PART II - OTHER INFORMATION


Item 6.  Exhibits and Reports on Form 8-K 
-----------------------------------------

(a) Exhibits:

(4) Form  of  Subscription  Agreement,  previously  filed  as  Exhibit  4.1  to
Amendment No. 1 to Registrant's Registration  Statement on Form S-11 dated  May
15, 1984  (Registration  No.  2-89380),  and  Form  of  Confirmation  regarding
Interests in the Registrant set forth as Exhibit 4.2 to the Registrant's Report
on Form 10-Q  for the quarter ended June 30, 1992  (Commission File  No.
0-13357) are incorporated herein by reference.

(10) Material Contracts:

(i) Agreement of Sale and attachment thereto relating to the sale of the Canyon
Pointe Apartments, San Antonio,  Texas previously filed as  Exhibit (2) to  the
Registrant's Current Report on  Form 8-K dated June  11, 1997, is  incorporated
herein by reference.

(ii) First Amendment to Agreement of Sale and Escrow Agreement relating to  the
sale of the Canyon Pointe Apartments,  San Antonio, Texas, previously filed  as
Exhibit (10)(d)(ii) to the Registrant's Quarterly  Report on Form 10-Q for  the
quarter ended September 30, 1997 is incorporated herein by reference.

(iii) Second Amendment to  Agreement of Sale and  Escrow Agreement relating  to
the sale of the Canyon Pointe Apartments, San Antonio, Texas, previously  filed
as Exhibit (10)(d)(iii) to the Registrant's  Quarterly Report on Form 10-Q  for
the quarter ended September 30, 1997 is incorporated herein by reference.

(27) Financial Data Schedule of the  Registrant for the six months ending  June
30, 1998 is attached hereto.

(b)  Reports on Form  8-K: There were no reports  filed on Form 8-K during  the
quarter ended June 30, 1998. 
<PAGE>
SIGNATURES

Pursuant to  the requirements  of  the Securities  Exchange  Act of  1934,  the
Registrant has  duly caused  this report  to be  signed on  its behalf  by  the
undersigned, thereunto duly authorized.


                                    BALCOR EQUITY PROPERTIES - XVIII
                                    A REAL ESTATE LIMITED PARTNERSHIP


                                    By:   /s/ Thomas E. Meador
                                           --------------------------
                                          Thomas E. Meador
                                          President and Chief Executive
                                          Officer (Principal Executive
                                          Officer) of Balcor Equity 
                                          Partners - XVIII, the General 
                                          Partner


                                    By:   /s/ Jayne A. Kosik
                                          -----------------------------
                                          Jayne A. Kosik
                                          Senior Managing Director and
                                          Chief Financial Officer
                                          (Principal Accounting Officer) 
                                          of Balcor Equity Partners 
                                          - XVIII, the General Partner


Date:
     -----------------
<PAGE>