UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549

                                   FORM 10-Q


[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 #0-16783


                    Inland Mortgage Investors Fund, L.P.-II
            (Exact name of registrant as specified in its charter)



         Delaware                                     #36-3495248
  (State or other jurisdiction      (I.R.S. Employer Identification Number) 
of incorporation or organization)



       2901 Butterfield Road, Oak Brook, Illinois         60523
        (Address of principal executive office)         (Zip Code)


    Registrant's telephone number, including area code:  630-218-8000


                                   N/A                        
                (Former name, former address and former fiscal
                      year, if changed since last report)


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   






                                      -1-



                    INLAND MORTGAGE INVESTORS FUND, L.P.-II
                            (a limited partnership)

                                Balance Sheets

                      June 30, 1998 and December 31, 1997
                                  (unaudited)

                                    Assets
                                    ------
                                                       1998          1997
                                                       ----          ----
Cash and cash equivalents (Note 1)................ $   514,396       169,895
Accrued interest receivable.......................      21,504        35,419
Mortgage loans receivable (Note 3)................   2,207,305     2,664,745
Miscellaneous receivable..........................      96,065          -
                                                   ------------  ------------
    Total assets.................................. $ 2,839,270     2,870,059
                                                   ============  ============


                       Liabilities and Partners' Capital
                       ---------------------------------
Liabilities:
  Due to affiliates (Note 2)......................         738         1,544
  Unearned income (Note 1)........................         470         1,044
                                                   ------------  ------------
    Total liabilities.............................       1,208         2,588
                                                   ------------  ------------
Partners' capital (Notes 1 and 2):
  General Partner:
    Capital contribution..........................         500           500
    Cumulative net income.........................     252,474       251,346
    Supplemental Capital Contribution.............     102,528        77,871
    Supplemental distributions to Limited Partners    (102,528)      (77,871)
    Cumulative cash distributions.................    (244,958)     (244,958)
                                                   ------------  ------------
                                                         8,016         6,888
  Limited Partners:                                ------------  ------------
    Units of $500. Authorized 40,000 Units,
      18,776.32 outstanding (net of
      offering costs of $1,072,632, of which
      $89,040 was paid to Affiliates).............   8,315,526     8,315,526
    Cumulative net income.........................   5,711,018     5,599,307
    Supplemental Capital Contributions from
      General Partner.............................     102,528        77,871
    Cumulative cash distributions................. (11,299,026)  (11,132,121)
                                                   ------------  ------------
                                                     2,830,046     2,860,583
                                                   ------------  ------------
    Total Partners' capital.......................   2,838,062     2,867,471
                                                   ------------  ------------
Total liabilities and Partners' capital........... $ 2,839,270     2,870,059
                                                   ============  ============


                See accompanying notes to financial statements.


                                      -2-



                    INLAND MORTGAGE INVESTORS FUND, L.P.-II
                            (a limited partnership)

                           Statements of Operations

           For the three and six months ended June 30, 1998 and 1997
                                  (unaudited)

                                         Three months           Six months
                                            ended                 ended
                                           June 30,              June 30,
                                           --------              --------
                                       1998       1997       1998       1997
Income:                                ----       ----       ----       ----
  Interest and fees on mortgage
    loans receivable (Note 3)       $  63,735     69,782    128,512    132,870
  Interest on investments..........     4,041      3,296      8,188      6,882
  Other income.....................    10,246      3,715     13,850      8,266
                                    ---------- ---------- ---------- ----------
                                       78,022     76,793    150,550    148,018
                                    ---------- ---------- ---------- ----------
Expenses:
  Professional services to
    Affiliates.....................     1,066      1,373      2,395      3,744
  Professional services to
    non-affiliates.................     5,130      2,878     21,230     21,748
  General and administrative
    expenses to Affiliates.........     6,297      5,366      9,458     19,050
  General and administrative
    expenses to non-affiliates.....     2,273      2,201      4,628      4,927
                                    ---------- ---------- ---------- ----------
                                       14,766     11,818     37,711     49,469
                                    ---------- ---------- ---------- ----------
    Net income..................... $  63,256     64,975    112,839     98,549
                                    ========== ========== ========== ==========

Net income allocated to:
  General Partner..................       632        649      1,128        985
  Limited Partners.................    62,624     64,326    111,711     97,564
                                    ---------- ---------- ---------- ----------
    Net income..................... $  63,256     64,975    112,839     98,549
                                    ========== ========== ========== ==========

Net income allocated to the one
  General Partner Unit............. $     632        649      1,128        985
                                    ========== ========== ========== ==========

Net income per Unit, basic and
  diluted, allocated to Limited
  Partners per Limited Partnership
  Units of 18,776.32............... $    3.34       3.43       5.95       5.20
                                    ========== ========== ========== ==========



                See accompanying notes to financial statements.


                                      -3-



                    INLAND MORTGAGE INVESTORS FUND, L.P.-II
                            (a limited partnership)

                           Statements of Cash Flows

                For the six months ended June 30, 1998 and 1997
                                  (unaudited)



                                                       1998          1997
                                                       ----          ----
Cash flows from operating activities:
  Net income...................................... $   112,839        98,549
  Adjustments to reconcile net income to net cash
      provided by operating activities:
    Changes in assets and liabilities:
      Accrued interest receivable.................      13,915         2,671
      Accounts payable............................        -            1,531
      Due to Affiliates...........................        (806)        2,202
      Unearned income.............................        (574)         (574)
                                                   ------------  ------------
Net cash provided by operating activities.........     125,374       104,379
                                                   ------------  ------------
Cash flows from investing activities:
  Miscellaneous receivables.......................     (96,065)         -
  Principal payments collected....................     457,440        46,376
                                                   ------------  ------------
Net cash provided by investing activities.........     361,375        46,376
                                                   ------------  ------------
Cash flows from financing activities:
  Supplemental capital contribution...............      24,657        21,477
  Distributions paid..............................    (166,905)     (195,995)
                                                   ------------  ------------
Net cash used in financing activities.............    (142,248)     (174,518)
                                                   ------------  ------------
Net increase (decrease) in cash and
  cash equivalents................................     344,501       (23,763)
Cash and cash equivalents at beginning of period..     169,895       177,482
                                                   ------------  ------------
Cash and cash equivalents at end of period........ $   514,396       153,719
                                                   ============  ============













                See accompanying notes to financial statements.


                                      -4-



                    INLAND MORTGAGE INVESTORS FUND, L.P.-II
                            (a limited partnership)

                         Notes to Financial Statements

                                 June 30, 1998
                                  (unaudited)



Readers of this  Quarterly  Report  should  refer  to the Partnership's audited
financial statements for the  fiscal  year  ended  December 31, 1997, which are
included  in  the  Partnership's  1997   Annual  Report,  as  certain  footnote
disclosures which would substantially duplicate those contained in such audited
financial statements have been omitted from this Report.

(1) Organization and Basis of Accounting

Inland Mortgage Investors  Fund,  L.P.-II  (the  "Partnership"),  was formed on
December 24, 1986 pursuant to  the Delaware Revised Uniform Limited Partnership
Act to make or acquire  loans  collateralized  by mortgages on improved, income
producing properties.   On  February  10,  1987,  the  Partnership commenced an
Offering of 40,000 Limited Partnership  Units  (the  "Units") at $500 per Unit,
pursuant to a Registration Statement on  Form  S-11 under the Securities Act of
1933.   The  Offering  terminated  on  August  10,  1988,  with  total sales of
18,776.32 Units, resulting in gross offering proceeds of $9,388,158, which does
not include the General Partner's contribution of  $500.  All of the holders of
these Units were admitted to  the  Partnership.   Inland Real Estate Investment
Corporation is the General Partner.

The preparation of financial  statements  in conformity with generally accepted
accounting principles requires  management  to  make  estimates and assumptions
that affect the reported amounts  of  assets  and liabilities and disclosure of
contingent assets and liabilities at  the  date of the financial statements and
the reported amounts of  revenues  and  expenses  during the reporting periods.
Actual results could differ from those estimates.

Offering costs have been offset against the Limited Partners' capital accounts.

Loan assumption fees received  are  deferred  as  unearned income and amortized
over the remaining life of the related loan.

The Partnership  considers  all  highly  liquid  investments  purchased with an
original maturity of three months or less to be cash equivalents.

The Partnership sold participations in mortgage receivables which may yield the
Partnership a return which  is  greater  than  the  return  based on the stated
interest rate of the instrument.   The differential between the stated rate and
the interest rate paid to the participant is recognized as income over the term
of the mortgage loan.







                                      -5-



                    INLAND MORTGAGE INVESTORS FUND, L.P.-II
                            (a limited partnership)

                         Notes to Financial Statements
                                  (continued)

                                 June 30, 1998
                                  (unaudited)


Interest income on  mortgage  loans  receivable  is  accrued  when earned.  The
accrual of interest, on loans that are in default, is discontinued when, in the
opinion of the General Partner, the  borrower  has not complied with loan work-
out arrangements. Once a loan has been placed on a non-accrual status, all cash
received is applied against the outstanding loan balance until such time as the
borrower has demonstrated an ability  to  make  payments under the terms of the
original or renegotiated loan  agreement.    The  General Partner evaluates the
collectibility of the mortgage  loans  on  a  quarterly basis.  This evaluation
includes determining the valuation of the underlying operating property subject
to the mortgage.  Should a  portion  of  the  principal of the mortgage loan be
considered unrecoverable either through  collection or foreclosure, a provision
would be made  to  reduce  the  carrying  amount  of  the  mortgage loans.  The
Partnership intends to pursue collection of  all amounts currently due from the
borrowers. 

The Partnership believes that the  interest  rates associated with the mortgage
receivable approximate the market  interest  rates,  and  as such, the carrying
amount of the mortgages receivable approximate their fair value.

Statement of Financial Accounting  Standards  No.  128 "Earnings per Share" was
adopted by the Partnership for the  year  ended  December 31, 1997 and has been
applied to all prior  earnings  periods  presented in the financial statements.
The Partnership has no dilutive securities.

No provision for Federal income taxes  has  been made as the liability for such
taxes is that of the Partners rather than the Partnership.

In  the  opinion  of  management,  the  financial  statements  contain  all the
adjustments necessary, which  are  of  a  normal  recurring  nature, to present
fairly the financial position and  results  of operations.  Interim periods are
not necessarily indicative of results to be expected for the year.


(2) Transactions with Affiliates

The General  Partner  and  its  Affiliates  are  entitled  to reimbursement for
salaries and expenses of employees  of  the  General Partner and its Affiliates
relating to the administration of the  Partnership.  Such costs are included in
professional services to Affiliates and  general and administrative expenses to
Affiliates, of which $738  and  $1,544  remained  unpaid  at  June 30, 1998 and
December 31, 1997, respectively.






                                      -6-



                    INLAND MORTGAGE INVESTORS FUND, L.P.-II
                            (a limited partnership)

                         Notes to Financial Statements
                                  (continued)

                                 June 30, 1998
                                  (unaudited)


Inland Mortgage Servicing  Corporation,  a  subsidiary  of the General Partner,
services the Partnership's  mortgage  loans  receivable.   Its services include
processing mortgage collections  and  escrow  deposits  and maintaining related
records.  For these services, the  Partnership  is  obligated to pay fees at an
annual rate equal to 1/4  of  1%  of the outstanding mortgage loans receivables
balance of the Partnership.  Such fees  of $4,026 and $3,361 for the six months
ended June 30, 1998 and 1997, respectively,  have been incurred and paid to the
subsidiary of the General Partner and are included in the Partnership's general
and administrative expenses to Affiliates.

The General Partner is required  to make Supplemental Capital Contributions, if
necessary, from time to time in  sufficient amounts to allow the Partnership to
make distributions to the Limited Partners  amounting  to at least 7% per annum
on their Invested Capital.  The  cumulative amount of such Supplemental Capital
Contributions at June 30, 1998 is $102,528, all of which has been received from
the General Partner.


(3) Mortgage Loans Receivable

Mortgage loans  receivable  are  collateralized  by  first  mortgages  and wrap
mortgages on multi-family residential  properties  located in Chicago, Illinois
or its surrounding metropolitan  area,  except  for the Evanston, Illinois loan
which is collateralized  by  a  multi-use  retail  and  office building and the
Richton Park, Illinois loan which  is  collateralized  by  a shopping mall.  As
additional collateral, the Partnership holds assignments of rents and leases or
personal guarantees  of  the  borrowers.    Generally,  the  mortgage notes are
payable in equal  monthly  installments  based  on  20  or 30 year amortization
periods.


(4) Subsequent Events

In July 1998, the Partnership paid a  distribution of $507,872 all of which was
distributed to Limited Partners,  including  $442,657 of repayment proceeds and
$65,215 of operating cash flow contribution.











                                      -7-



Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations

Certain statements in this  "Management's  Discussion and Analysis of Financial
Condition and Results of Operations" and  elsewhere in this quarterly report on
Form 10-Q constitute  "forward-looking  statements"  within  the meaning of the
Federal Private Securities  Litigation  Reform  Act  of  1995.   These forward-
looking statements involve  known  and  unknown  risks, uncertainties and other
factors which  may  cause  the  Partnership's  actual  results, performance, or
achievements to be materially  different  from any future results, performance,
or achievements  expressed  or  implied  by  these  forward-looking statements.
These factors include, among other things, federal, state or local regulations;
adverse changes in general economic  or local conditions; inability of borrower
to meet financial  obligations;  uninsured  losses;  and potential conflicts of
interest between the  Partnership  and  its  Affiliates,  including the General
Partner.

Liquidity and Capital Resources

On February 10, 1987, the  Partnership  commenced an Offering of 40,000 Limited
Partnership Units, pursuant to a Registration  Statement on Form S-11 under the
Securities Act of 1933.   The  Offering  terminated  on August 10, 1988, with a
total of 18,776.32 Units being sold to the public at $500 per Unit resulting in
$9,388,158 gross offering  proceeds,  which  were  received by the Partnership,
which  does  not  include  the   General  Partner's  $500  contribution.    The
Partnership funded fifteen loans between  December 1987 and June 1992 utilizing
$8,131,884 of capital proceeds collected,  net  of  participations.  As of June
30, 1998, cumulative distributions to  Limited Partners totaled $11,299,026.  A
total of $6,468,169 of mortgage  receivables  has  been repaid by borrowers, of
which $966,160 was reloaned,  $5,495,672  was  repayment proceeds and principal
amortization distributed to Limited  Partners  and  $6,337 was added to working
capital reserve.

At June 30, 1998,  the  Partnership  had  cash and cash equivalents aggregating
$514,396, which will be utilized  for  future distributions to partners and for
working capital requirements.  The source of future liquidity and distributions
is expected to be  through  cash  generated  by earnings from the Partnership's
mortgage investments and through  the  repayment  of  such investments.  To the
extent that  cash  flow  is  insufficient  to  meet  the  minimum 7% annualized
distribution  to  investors,  as  well   as  any  other  financial  needs,  the
Partnership may rely  on  Supplemental  Capital  Contributions from the General
Partner, advances from Affiliates  of  the  General Partner or other short-term
financing.

At June 30, 1998, the  Partnership  had four mortgage loans receivable totaling
$2,207,305.  The  maturity  dates  range  from  October  1997  to July 2001. In
October 1997, the  loan  collateralized  by  the  property located at 1549-1571
Sherman Avenue was extended on  a  month  to  month basis to allow the borrower
time to  proceed  with  refinancing.    In  October  1997,  Inland  Real Estate
Investment  Corporation,  the  General  Partner,  purchased  the  participating
interest in the loan  from  an  unaffiliated  third  party and has accepted the
terms of the month to month extension.    All other terms remain the same. When
and as the Partnership receives Repayment  Proceeds  as a result of the sale or
repayment  of  a  loan,  the   Repayment   Proceeds  which  are  available  for
distribution will be distributed to the  Limited  Partners.  When the loans are
repaid, cash flows from operating activities  will  decrease as a result of the
decrease in interest income earned by the Partnership.


                                      -8-



Results of Operations

Interest and fee income on mortgage loans receivable decreased slightly for the
three and six months ended  June  30,  1998,  as  compared to the three and six
months ended June 30, 1997.   This  is  due  primarily to the prepayment of the
mortgage loan receivable  collateralized  by  the  property  located at 7409-13
Seeley, Chicago, Illinois and the partial  paydowns throughout 1997 and 1998 on
the mortgage loan receivable  collateralized  by  the  property located at 7432
Washington, Forest Park, Illinois.

The increase in other income for the  three and six months ended June 30, 1998,
as compared to the three  and  six  months  ended  June  30, 1997, is due to an
increase in late charge income collected on mortgage loans receivable.

Professional services to  Affiliates  decreased  for  the  three and six months
ended June 30, 1998, as compared  to  the  three  and six months ended June 30,
1997, due  to  decreases  in  legal  and  accounting  services  required by the
Partnership. 

General and administrative expenses to  Affiliates  decreased for the three and
six months ended June 30, 1998, as  compared  to the three and six months ended
June 30, 1997, due  primarily  to  a  decrease  in data processing and investor
service expenses.

Year 2000 Compliance

The  Partnership  has  reviewed  its  current  computer  systems  and  does not
anticipate any future problems relating to the year 2000.





                          PART II - Other Information

Items 1 through 6 (b) are  omitted  because  of the absence of conditions under
which they are required.

Item 7.  Exhibits and Reports on Form 8-K

     (a) Exhibits:
     
         (27) Financial Data Schedule

     (b) Reports on Form 8-K:

         None










                                      -9-



                                  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.



                            INLAND MORTGAGE INVESTORS FUND, L.P.-II

                            By:   Inland Real Estate Investment Corporation
                                  General Partner


                                  /S/ ROBERT D. PARKS

                            By:   Robert D. Parks
                                  Chairman
                            Date: August 6, 1998


                                  /S/ MARK ZALATORIS

                            By:   Mark Zalatoris
                                  Vice President
                            Date: August 6, 1998


                                  /S/ KELLY TUCEK

                            By:   Kelly Tucek
                                  Principal Financial Officer and 
                                  Principal Accounting Officer
                            Date: August 6, 1998





















                                     -10-