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

                  FORM 10-Q

(Mark One)

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

For the quarterly period ended    September
30, 1997

                     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          0-14378      
 


  Krupp Institutional Mortgage Fund Limited
Partnership


          Massachusetts                      
               04-2860302
(State or other jurisdiction of              
                  (IRS employer
incorporation or organization)               
             identification no.)

470 Atlantic Avenue, Boston, Massachusetts   
                         02210
(Address of principal executive offices)     
                         (Zip Code)


               (617) 423-2233
  (Registrant's telephone number, including
area code)



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      

The total number of pages in this document is 11.
<PAGE>
                 PART I.  FINANCIAL INFORMATION

Item 1.                                 FINANCIAL STATEMENTS

This Form 10-Q contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section
21E of the Securities Exchange Act of 1934.  Actual results could
differ materially from those projected in the forward-looking
statements as a result of a number of factors, including those
identified herein.

      KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED PARTNERSHIP

                         BALANCE SHEETS
<TABLE>
<CAPTION>
                                      

                             ASSETS


                                        September 30,December 31,
                                            1997       1996    

<S>                                     <C>         <C>     
Mortgage notes receivable, net of loan loss
  reserve of $16,524,000 (Notes 3 and 4)$ 6,949,839 $ 6,973,754
Cash and cash equivalents (Note 2)        1,110,363      1,112,524 
Accrued interest receivable - mortgage notes,
  net of reserve for uncollectible interest of
  $13,997,634 and $12,225,634, respectively              
  (Notes 3 and 4)                           118,642     115,272
Due from affiliates (Note 6)                   -         16,250
Other assets                                  1,865       1,672

     Total assets                       $ 8,180,709  $ 8,219,472
                                                    


                LIABILITIES AND PARTNERS' EQUITY

Liabilities                             $    19,150 $    25,274

Partners' equity (deficit) (Note 5):
Limited Partners (30,059 Units outstanding)8,379,548  8,411,861
  General Partners                         (217,989)   (217,663)

Total Partners' equity                    8,161,559   8,194,198

Total liabilities and Partners' equity  $ 8,180,709 $ 8,219,472

</TABLE>













             The accompanying notes are an integral
                part of the financial statements.
<PAGE>
      KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED PARTNERSHIP

                      STATEMENTS OF INCOME
                                      

<TABLE>
<CAPTION>

                       For the Three Months   For the Nine Months
                       Ended September 30,    Ended September 30, 
                         1997          1996       1997     1996  

<S>                     <C>          <C>        <C>       <C>    
Interest income:
  Mortgage notes receivable
     (Notes 3 and 4)    $140,876     $ 73,737   $445,796  $359,284
  Cash equivalents (Note 2)  15,949    16,793    46,035     62,650

     Total interest income  156,825    90,530    491,831   421,934

Expenses:
  Expense reimbursements 
     (Note 6)                 9,156    12,951     25,739    36,644
  General and administrative   7,949    7,384     43,292    44,794

     Total expenses          17,105    20,335     69,031    81,438

Net income                 $139,720  $ 70,195   $422,800  $340,496


Allocation of net income 
     (Note 5):

  Limited Partners (30,059 
     Units outstanding)    $138,323  $ 69,493   $418,572  $337,091

  Limited Partners Per Unit $   4.61 $   2.31   $  13.93  $  11.21

  General Partners         $  1,397  $    702   $  4,228  $  3,405

</TABLE>























The accompanying notes are an integral
                part of the financial statements.
<PAGE>
      KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED PARTNERSHIP

                    STATEMENTS OF CASH FLOWS
                                       
<TABLE>
<CAPTION>
                                             For the Nine Months 
                                              Ended September 30, 
                                              1997      1996    
  <S>                                     <C>        <C>
Operating activities:
  Net income                              $  422,800 $  340,496
  Adjustments to reconcile net income to
     net cash provided by operating activities:
       Changes in assets and liabilities:
          Decrease (increase) in accrued interest
            receivable-mortgage notes         (3,370)      61,575
          Decrease in due from affiliates     16,250       1,081
          Decrease (increase) in other assets  (193)         148
          Increase (decrease) in liabilities    (6,124)    54,361

            Net cash provided by operating
               activities                    429,363     457,661

Investing activities: 
  Principal collections from mortgage         
     notes receivable                         23,915     21,648
  Principal collections from mortgage notes 
     receivable due to sale of properties       -      4,792,959

            Net cash provided by investing
               activities                     23,915   4,814,607

Financing activity:
  Distributions                             (455,439) (5,296,760)

Net decrease in cash and cash equivalents    (2,161)     (24,492)

Cash and cash equivalents, beginning of period 1,112,524 1,260,798

Cash and cash equivalents, end of period  $1,110,363  $1,236,306

</TABLE>




















             The accompanying notes are an integral
                part of the financial statements.
<PAGE>
      KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED PARTNERSHIP

                  NOTES TO FINANCIAL STATEMENTS
                                     

(1)Accounting Policies

Certain information and footnote disclosures
normally included in financial statements
prepared in accordance with generally accepted
accounting principles have been condensed or
omitted in this report on Form 10-Q pursuant
to the Rules and Regulations of the Securities
and Exchange Commission.  In the opinion of
The Krupp Corporation and The Krupp Company
Limited Partnership-III ("Krupp Co.-III"), the
General Partners of Krupp Institutional
Mortgage Fund Limited Partnership (the
"Partnership"/"KIMF"), the disclosures
contained in this report are adequate to make
the information presented not misleading.  See
Notes to Financial Statements in the
Partnership's Annual Report on Form 10-K for
the year ended December 31, 1996 for
additional information relevant to significant
accounting policies followed by the
Partnership.

In the opinion of the General Partners of the
Partnership, the accompanying unaudited
financial statements reflect all adjustments
necessary to present fairly the Partnership's
financial position as of September 30, 1997,
its results of operations for the three and
nine months ended September 30, 1997 and 1996,
and cash flows for the nine months ended
September 30, 1997 and 1996.  Certain prior
year balances have been reclassified to
conform with current year financial statement
presentation.

The results of operations for the three and
nine months ended September 30, 1997 are not
necessarily indicative of the results which
may be expected for the full year.  See
Management's Discussion and Analysis of
Financial Condition and Results of Operations
included in this report.

(2)   Cash and Cash Equivalents

   Cash and cash equivalents consisted of the following:
<TABLE>
<CAPTION>
                                      September 30, December 31, 
                                          1997          1996     

      <S>                             <C>           <C>
      Cash and money market accounts  $    315,221  $   316,317
      Commercial paper                     795,142      796,207
   
                                      $  1,110,363  $ 1,112,524
</TABLE>

At September 30, 1997, commercial paper
represents corporate issues maturing in the
fourth quarter of 1997.  At September 30,
1997, the carrying value of the Partnership's
investment in commercial paper approximates
fair value.

(3)Krupp Equity Limited Partnership ("KELP")
                            
The Partnership made loans to KELP, an
affiliate of the Partnership, as provided
under the Master Loan Agreement and Collateral
Pledge Agreement.  Pursuant to the Agreements,
the mortgage notes receivable are cross
collateralized by the KELP properties.  The
purpose of KELP is to acquire, manage, operate
and sell real estate and personal property;
and to borrow funds from the Partnership and
other sources to finance the acquisition,
management and operation of real estate and
personal property related thereto.  Condensed
financial statements of KELP are as follows:
                            




Continued
<PAGE>
      KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED PARTNERSHIP

            NOTES TO FINANCIAL STATEMENTS, Continued
                                     


(3)   Krupp Equity Limited Partnership ("KELP") - Continued

KRUPP EQUITY LIMITED PARTNERSHIP
                    CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
                                     
                             ASSETS
                                        September 30,December 31,
                                            1997         1996    
   <S>                                  <C>          <C>
   Real estate assets:
      Real estate, at cost              $ 12,749,857 $ 12,716,122 
      Property valuation provision        (5,000,000)   (5,000,000)
      Accumulated depreciation            (3,972,535)   (3,795,870)

          Total real estate assets         3,777,322      3,920,252
 
      Other assets                           287,710        305,538

          Total assets                  $  4,065,032 $  4,225,790
 
                LIABILITIES AND PARTNERS' DEFICIT
                                                     
Mortgage notes payable to the Partnership$ 28,266,798  $ 28,290,713
   Notes payable to an affiliate             300,000        300,000
   Accrued interest payable to                          
      affiliates (A)                       9,677,093     7,880,286
   Due to affiliates                         716,966        666,702
   Other liabilities                         346,477      386,780

          Total liabilities               39,307,334   37,524,481

   Partners' deficit                     (35,242,302)(33,298,691)
          Total liabilities and Partners'
            deficit                     $  4,065,032 $ 4,225,790
</TABLE>

                KRUPP EQUITY LIMITED PARTNERSHIP
               CONDENSED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
                                      
          For the Three Months        For the Nine Months
           Ended September 30,         Ended September 30,   
            1997       1996            1997          1996    

<S>           <C>         <C>                <C>          <C>
Revenue (A)(B)$ 254,830   $ 257,067          $ 1,160,346$ 1,459,430
   Property operating
      expenses  (62,248)    (70,704)            (316,281)   (637,314)
Depreciation and
amortization (A)(B)(61,924) (58,966)            (356,637) (724,149)
Interest (B) (754,227)     (754,808)        (2,541,770)(2,411,839)
Loss before gain on sale
of properties and         
extinguishment of debt(623,569) (627,411) (2,054,342)(2,313,872)
   Gain:
Sale of properties (A)    -        -                -     1,661,996
      Extinguishment of
       debt (B)     -          -                 108,711       -   

Net loss$(623,569)        $(627,411)         $(1,945,631)$(651,876)
</TABLE>

Continued
<PAGE>
      KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED PARTNERSHIP

            NOTES TO FINANCIAL STATEMENTS, Continued
                                     


(3)Krupp Equity Limited Partnership ("KELP") -
Continued

(A)On March 5, 1996, KELP sold Village Green
Apartments to an  unaffiliated third party for
$5,200,000.  On May 16, 1996, KELP sold North
Salado to an unaffiliated third party for
$7,350,000.  KELP remitted available sale
proceeds of $4,792,959 to the Partnership. 
For KELP's financial reporting purposes, sales
proceeds paid to KIMF of $4,792,959 were
applied against accrued interest in 1996.

(B)On May 13, 1997, KELP acquired all of the
beneficial interests in four Delaware business
trusts and a 99% member interest in a limited
liability company (collectively referred to as
the "Entities") for an aggregate purchase
price of $32,025,603.  KELP acquired the
Entities for cash of $3,309,761, subject to
their outstanding mortgage balances as of May
13, 1997, totaling $28,715,842.  KELP obtained
the cash used in the exchange through the
proceeds of a loan made by KCLP III ("KCLP III
Note"), its general partner and limited
partner.  Each of the Entities acquired owns
real property, which is net leased to a
national retail franchise.  On June 23, 1997,
KELP admitted KGP-II Inc. as a limited
partner.  Subsequently, on June 30, 1997, KELP
distributed its interests in the Entities to
KCLP III in full satisfaction of the KCLP III
Note and in exchange for its entire
partnership interest in KELP.  The promissory
notes due KIMF from KCLP III, which total
$2,767,388 and are pledged as collateral on
the participating promissory notes
("Participating Notes"), remain as an
obligation of KCLP III.

The above transactions had no effect on KELP's
net loss and there was no positive or negative
cash flow which resulted from the operations
of the Entities.  Accordingly, the transaction
had no impact on KELP's ability to make the
required quarterly cash flow payment to KIMF,
the holder of its Participating Notes, or its
ability to meet other obligations with respect
to the Participating Notes. 

(4)Provision for Credit Losses and Accrued
Interest Reserves

The General Partners of the Partnership have
recorded a cumulative provision for credit
losses of $16,524,000 on its mortgage notes
receivable as of September 30, 1997 and
December 31, 1996.  Additionally, the
Partnership has recorded cumulative provisions
for uncollectible interest of $13,997,634 and
$12,225,634 as of September 30, 1997 and
December 31, 1996, respectively.  These
cumulative provisions are recorded against the
carrying value of the assets in order to
reflect management's current estimates of the
underlying property values which, given the
inherent uncertainty of real estate valuation
in the current market, could differ from the
ultimate value obtained upon sale of such
properties.




Continued
  KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED
PARTNERSHIP

  NOTES TO FINANCIAL STATEMENTS, Continued
                           


(5) Summary of Change in Partners' Equity  
<TABLE>
<CAPTION>
    A summary of changes in Partners' equity (deficit) for the nine
    months ended September 30, 1997 is as follows:
                                Total
                               Limited    General    Partners'
                               Partners   Partners    Equity   
<S>                           <C>         <C>       <C>
Balance at
December 31, 1996             $ 8,411,861 $(217,663)$ 8,194,198
Net income                        418,572     4,228      422,800 
Distributions                    (450,885)   (4,554)   (455,439)
     Balance at 
       September 30, 1997     $ 8,379,548 $(217,989)$ 8,161,559
</TABLE>

(6)Related Party Transactions

The Partnership reimburses affiliates of the
General Partners for certain expenses incurred
in connection with the activities of the
Partnership, including communications,
bookkeeping and clerical work necessary in
maintaining relations with Limited Partners,
and accounting, tax and computer services
necessary for the maintenance of the books and
records of the Partnership.

Due from affiliates consisted of expense
reimbursements of $16,250 at  December 31,
1996.  



 




























  KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED
PARTNERSHIP
                           


Item 2.MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Management's Discussion and Analysis of
Financial Condition and Results of Operations
contains forward-looking statements including
those concerning Management's expectations
regarding the future financial performance and
future events.  These forward-looking
statements involve significant risk and
uncertainties, including those described
herein.  Actual results may differ materially
from those anticipated by such forward-looking
statements.

Liquidity and Capital Resources

Currently, the Partnership has sufficient
liquidity to meet its operating needs.  The
most significant demand on the Partnership's
capital is distributions to investors. 
Distributions are dependent on the
Partnership's current capital cash resources
and on cash flow received from KELP's interest
payments on the Participating Notes.  These
cash flow payments are based upon the cash
flow generated by the underlying properties. 
Due to fluctuations in the cash flow payments
received from KELP and its effect on the
Partnership's liquidity, the Partnership may
need to periodically adjust its distribution
rate.  Therefore, sustaining the current
distribution rate is mainly dependent upon the
future cash flow payments received from KELP. 
 

KELP's properties have not generated cash flow
sufficient to meet the terms of their existing
obligations.  Recently, the remaining
properties have generated a consistent level
of operating cash flow.  The Partners of KELP
have made cumulative capital contributions of
approximately $4,673,000 to cover prior
operating deficits and have arranged for
certain short-term borrowings.  Additionally,
the affiliated management agent has not
received payment of management fees since
1991.  The General Partners of the Partnership
have not commenced foreclosure proceedings
because they believe that it is in the
Partnership's best interest to continue to
permit KELP to hold the properties, attempt to
increase cash flows and selectively sell the
properties, as the market deems appropriate.

Operations

Total revenue increased for the three and nine
months ended September 30, 1997, as compared
to the three and nine months ended September
30, 1996, as a result of the increase in
interest income earned on mortgage notes due
to increased cash flow interest payments
received from KELP's properties.  This
increase was partially offset by a decrease in
interest income earned on cash equivalents
which was attributable to lower average cash
and cash equivalents available for investment.

Total expenses decreased for the three and
nine months ended September 30, 1997, as
compared to the same periods in 1996, due to a
decrease in expense reimbursements. The
decrease in expense reimbursements is due to
decreased costs incurred in connection with
the preparation and mailing of reports and
other investor communications.

KELP Operations

Net loss, after giving effect to the sales of
Village Green Apartments and North Salado
Shopping Center and the acquisition and
distribution of the Entities (as described in
Note 3), remained stable for the three and
nine months ended September 30, 1997, when
compared to the same periods in 1996, as total
revenue and total expenses remained relatively
constant. 
<PAGE>



  KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED
PARTNERSHIP

         PART II - OTHER INFORMATION
                            



Item 1. 
  Legal Proceedings
  Response:  None

Item 2.
  Changes in Securities
  Response:  None

Item 3.
  Defaults upon Senior Securities
  Response:  None

Item 4.
  Submission of Matters to a Vote of Security
Holders
  Response:  None

Item 5.
  Other Information
  Response:  None

Item 6.
  Exhibits and Reports on Form 8-K
  Response:  None







                   <PAGE>
                  SIGNATURE

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.



Krupp Institutional Mortgage Fund Limited
Partnership
                          (Registrant)


BY:      /s/Wayne H. Zarozny                 
     
         Wayne H. Zarozny
         Treasurer and Chief Accounting
         Officer of The Krupp Corporation, 
         a General Partner.



DATE: November 12, 1997