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               September 30, 2000
                               -------------------------------------------------

                                       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                         0-17589
                       ---------------------------------------------------------

                            NTS-PROPERTIES VII, LTD.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

                 Florida                                         61-1119232
---------------------------------------------              ---------------------
(State or other jurisdiction of incorporation               (I.R.S. Employer
or organization)                                             Identification No.)

         10172 Linn Station Road
          Louisville, Kentucky                                      40223
---------------------------------------------              ---------------------
(Address of principal executive offices)                         (Zip Code)

                                 (502) 426-4800
--------------------------------------------------------------------------------
              (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,  and (2) has been subject to such filing  requirements
for the past 90 days.
                                                        [X] Yes           [ ] No

<PAGE>

                                TABLE OF CONTENTS
                                -----------------

                                     PART I
                                     ------

                                                                           Pages
                                                                           -----

Item 1. Financial Statements

        Balance Sheets as of September 30, 2000 and December 31, 1999          3

        Statement of Partners' Equity as of September 30, 2000                 3

        Statements of Operations for the three months and nine months ended
          September 30, 2000 and 1999                                          4

        Statements of Cash Flows for the nine months ended
          September 30, 2000 and 1999                                          5

        Notes to Financial Statements                                       6-13

Item 2. Management's Discussion and Analysis of Financial Condition
          and Results of Operations                                        14-19

Item 3. Quantitative and Qualitative Disclosures About Market Risk            20


                                     PART II
                                     -------

Item 1. Legal Proceedings                                                     21

Item 2. Changes in Securities                                                 21

Item 3. Defaults Upon Senior Securities                                       21

Item 4. Submission of Matters to a Vote of Security Holders                   21

Item 5. Other Information                                                     21

Item 6. Exhibits and Reports on Form 8-K                                      21

Signatures                                                                    22

                                        2

<PAGE>

PART I. FINANCIAL INFORMATION
-----------------------------
Item 1. Financial Statements
----------------------------

<TABLE>

                            NTS-PROPERTIES VII, LTD.
                            ------------------------
                                 BALANCE SHEETS
                                 --------------

<CAPTION>
                                                                            As of                      As of
                                                                        September 30,               December 31
                                                                             2000                      1999*
                                                                     -------------------        -------------------
                                                                         (UNAUDITED)

ASSETS
------
<S>                                                                   <C>                       <C>
Cash and equivalents                                                  $          432,454        $           400,262
Cash and equivalents - restricted                                                 42,195                     40,080
Accounts receivable                                                               16,895                     21,771
Land, buildings and amenities, net                                             9,462,999                  9,688,537
Other assets                                                                     142,947                    116,993
                                                                       -----------------         ------------------

     TOTAL ASSETS                                                     $       10,097,490        $        10,267,643
                                                                       =================         ==================

LIABILITIES AND PARTNERS' EQUITY
--------------------------------
Mortgages payable                                                     $        4,667,088        $         4,854,355
Accounts payable                                                                  96,289                     97,355
Distributions payable                                                             27,941                          -
Security deposits                                                                 26,850                     26,475
Other liabilities                                                                113,805                     24,646
                                                                       -----------------         ------------------

     TOTAL LIABILITIES                                                         4,931,973                  5,002,831

COMMITMENTS AND CONTINGENCIES (Note 9)

PARTNERS' EQUITY                                                               5,165,517                  5,264,812
                                                                       -----------------         ------------------

TOTAL LIABILITIES AND PARTNERS' EQUITY                                $       10,097,490        $        10,267,643
                                                                       =================         ==================

</TABLE>

<TABLE>

                          STATEMENT OF PARTNERS' EQUITY
                          -----------------------------

<CAPTION>

                                                     Limited Partners        General Partner             Total
                                                   --------------------    --------------------  ---------------------
PARTNERS' EQUITY/(DEFICIT)
-------------------------
<S>                                                 <C>                    <C>                    <C>
Capital contributions, net of  offering costs       $        10,935,700    $               100    $         10,935,800
Net loss - prior years                                       (2,569,539)               (25,954)             (2,595,493)
Net loss - current year                                            (217)                    (2)                   (219)
Cash distributions declared to date                          (2,717,046)               (27,445)             (2,744,491)
Repurchase of Limited Partnership Units                        (430,080)                     -                (430,080)
                                                     ------------------     ------------------     -------------------

BALANCES AT September 30, 2000                      $         5,218,818    $           (53,301)   $          5,165,517
                                                     ==================     ==================     ===================

</TABLE>

*    Reference is made to the audited financial statements in Form 10-K as filed
     with the Securities and Exchange Commission on March 29, 2000.

The  accompanying  notes to financial  statements  are an integral part of these
statements.

                                        3

<PAGE>

<TABLE>

                            NTS-PROPERTIES VII, LTD.
                            ------------------------
                            STATEMENTS OF OPERATIONS
                            ------------------------
                                   (UNAUDITED)
                                   -----------
<CAPTION>

                                                         Three Months Ended                Nine Months Ended
                                                           September 30,                      September 30,
                                                  --------------------------------   ------------------------------
                                                       2000             1999             2000             1999
                                                  ---------------  ---------------   -------------   --------------

REVENUES
--------
<S>                                                <C>               <C>               <C>              <C>
Rental income                                      $      489,468    $     514,892     $ 1,431,741      $ 1,460,339
Interest and other income                                  11,003            4,505          24,820           17,602
Gain on sale of assets                                          -                -           4,118                -
                                                    -------------     ------------      ----------       ----------

     TOTAL REVENUES                                       500,471          519,397       1,460,679        1,477,941
                                                    -------------     ------------      ----------       ----------

EXPENSES
--------
Operating expenses                                        145,835          118,014         314,587          301,766
Operating expenses - affiliated                            64,695           65,684         186,414          197,637
Loss on disposal of assets                                 34,690                -          54,608                -
Interest expense                                           89,524           94,775         270,724          286,203
Management fees                                            26,348           27,728          76,268           76,514
Real estate taxes                                          29,854           27,136          84,439           81,407
Professional and administrative expenses                   13,983           31,454          66,546           79,956
Professional and administrative
   expenses - affiliated                                   21,423           17,614          63,667           53,549
Depreciation and amortization                             115,321          115,989         343,645          357,830
                                                    -------------     ------------      ----------       ----------

     TOTAL EXPENSES                                       541,673          498,394       1,460,898        1,434,862
                                                    -------------     ------------      ----------       ----------

Net (loss) income                                  $      (41,202)   $      21,003     $      (219)     $    43,079
                                                    =============     ============      ==========       ==========

Net (loss) income allocated to the
   Limited Partners                                $      (40,790)   $      20,793     $      (217)     $    42,648
                                                    =============     ============      ==========       ==========

Net (loss)  income per Limited
   Partnership Unit                                $        (0.07)   $        0.04     $    ( 0.00)     $      0.08
                                                    =============     ============      ==========       ==========

Weighted average number of  Limited
   Partnership Units                                      554,622          565,736         555,362          568,300
                                                    =============     ============      ==========       ==========

</TABLE>

The  accompanying  notes to financial  statements  are an integral part of these
statements.

                                        4

<PAGE>

<TABLE>

                            NTS-PROPERTIES VII, LTD.
                            ------------------------
                            STATEMENTS OF CASH FLOWS
                            ------------------------
                                   (UNAUDITED)
                                   -----------

<CAPTION>

                                                                                       Nine Months Ended
                                                                                         September 30,
                                                                          --------------------------------------------
                                                                                2000                       1999
                                                                          -----------------          -----------------

CASH FLOWS FROM OPERATING ACTIVITIES
------------------------------------
<S>                                                                       <C>                        <C>
Net (loss) income                                                         $            (219)         $          43,079
Adjustments to reconcile net income to net cash provided
  by operating activities:
    Loss on disposal of assets                                                       54,608                          -
    Gain on sale of assets                                                           (4,118)                         -
    Depreciation and amortization                                                   343,645                    357,830
    Changes in assets and liabilities:
      Cash and equivalents - restricted                                              (2,115)                    44,898
      Accounts receivable                                                             4,876                    (12,269)
      Other assets                                                                  (30,234)                     8,656
      Accounts payable                                                               (1,066)                    17,356
      Security deposits                                                                 375                      2,398
      Other liabilities                                                              89,159                     49,835
                                                                           ----------------           ----------------

     Net cash provided by operating activities                                      454,911                    511,783
                                                                           ----------------           ----------------

CASH FLOWS FROM INVESTING ACTIVITIES
------------------------------------
Proceeds from sale of assets                                                          6,934                          -
Additions to land, buildings and amenities                                         (171,251)                   (73,745)
                                                                           ----------------           ----------------

     Net cash used in investing activities                                         (164,317)                   (73,745)
                                                                           ----------------           ----------------

CASH FLOWS FROM FINANCING ACTIVITIES
------------------------------------
Cash and equivalents - restricted                                                         -                    (60,000)
Principal payment on mortgages payable                                             (187,267)                  (173,543)
Cash distributions                                                                  (56,135)                   (86,222)
Repurchase of Limited Partnership Units                                             (15,000)                   (60,000)
                                                                           ----------------           ----------------

     Net cash used in financing activities                                         (258,402)                  (379,765)
                                                                           ----------------           ----------------

     Net increase in cash and equivalents                                            32,192                     58,273

CASH AND EQUIVALENTS, beginning of period                                           400,262                    398,001
                                                                           ----------------           ----------------

CASH AND EQUIVALENTS, end of period                                       $         432,454          $         456,274
                                                                           ================           ================

Interest paid on a cash basis                                             $         272,124          $         286,203
                                                                           ================           ================

</TABLE>

The  accompanying  notes to financial  statements  are an integral part of these
statements.

                                        5

<PAGE>

                            NTS-PROPERTIES VII, LTD.
                            ------------------------
                          NOTES TO FINANCIAL STATEMENTS
                          -----------------------------

The unaudited financial statements included herein should be read in conjunction
with the Partnership's  1999 Form 10-K as filed with the Securities and Exchange
Commission  on March 29,  2000.  In the  opinion  of the  General  Partner,  all
adjustments (only consisting of normal recurring  accruals) necessary for a fair
presentation  have been made to the  accompanying  financial  statements for the
nine months ended September 30, 2000 and 1999.

1.   Use of Estimates in the Preparation of Financial Statements
     -----------------------------------------------------------

     The  preparation  of financial  statements  in  conformity  with  Generally
     Accepted  Accounting   Principles  ("GAAP")  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  period.  Actual  results could differ from
     those estimates.

2.   Concentration of Credit Risk
     ----------------------------

     NTS-Properties  VII,  Ltd. owns and operates,  through a joint  venture,  a
     commercial  rental  property  in  Louisville,  Kentucky.  A  single  tenant
     occupies this commercial  property.  The Partnership also owns and operates
     residential rental properties in Louisville and Lexington, Kentucky.

     It is the  Partnership's  understanding  that SHPS, Inc. does not intend to
     continue to occupy the space at Blankenbaker Business Center 1A through the
     duration of its lease, ending in July 2005. The Partnership's proportionate
     share of the rental income from this property  accounted for  approximately
     14% of the Partnership's total revenues for the nine months ended September
     30, 2000. The Partnership has not yet determined the effect, if any, on the
     Partnership's  operations,  given the fact SHPS,  Inc. is under lease until
     July 2005 and no official notice of termination has been received.

3.   Reclassifications of 1999 Financial Statements
     ----------------------------------------------

     Certain  reclassifications  have  been  made  to  the  September  30,  1999
     financial   statements   to   conform   with   the   September   30,   2000
     classifications.  These  reclassifications  have no  effect  on  previously
     reported operations.

4.   Cash and Equivalents - Restricted
     ---------------------------------

     Cash and equivalents - restricted represents funds received for residential
     security  deposits,  funds which have been escrowed with mortgage companies
     for  property  taxes in  accordance  with the loan  agreements,  and  funds
     reserved by the Partnership for the purchase of Limited  Partnership  Units
     through tender offers (See Notes to Financial Statements - Note 7).

                                        6

<PAGE>

5.   Basis of Property and Depreciation
     ----------------------------------

     Land,   buildings  and  amenities  are  stated  at  historical  cost,  less
     accumulated  depreciation,  to the Partnership.  Costs directly  associated
     with  the  acquisition,  development  and  construction  of a  project  are
     capitalized.  Depreciation is computed using the straight-line  method over
     the  estimated  useful  lives of the  assets  which are 7-30 years for land
     improvements,  5-30 years for  buildings and  improvements,  5-30 years for
     amenities and the applicable lease term for tenant improvements.

     Statement of Financial  Accounting  Standards ("SFAS") No. 121, "Accounting
     for the  Impairment of Long-Lived  Assets and for  Long-Lived  Assets to be
     Disposed Of," specifies  circumstances in which certain  long-lived  assets
     must be reviewed for impairment. If the carrying amount of an asset exceeds
     the sum of its expected future cash flows,  the asset's carrying value must
     be written down to fair value.  Application  of this standard by management
     during the periods ended  September 30, 2000 and 1999 did not result in any
     impairment loss.

6.   Mortgages Payable
     -----------------

     Mortgages payable consist of the following:

<TABLE>

                                                                     September 30, 2000             December 31, 1999
                                                                ----------------------------    --------------------------
     <S>                                                        <C>                             <C>
     Mortgage  payable to an insurance  company, bearing
     interest at a fixed rate of 7.37%, due October 15,
     2012, secured by land and buildings.                        $                 3,787,716     $               3,876,398

     Mortgage payable to an insurance company, bearing
     interest at a fixed rate of 8.5%, due November 15,
     2005, secured by land and buildings.                                            879,372                       977,957
                                                                  --------------------------      ------------------------

                                                                 $                 4,667,088     $               4,854,355
                                                                  ==========================      ========================

</TABLE>

     Based on the borrowing  rates  currently  available to the  Partnership for
     mortgages  with  similar  terms and average  maturities,  the fair value of
     long-term debt is approximately $4,522,000.

7.   Tender Offer
     ------------

     On March 24,  2000,  the  Partnership  and ORIG,  LLC, an  affiliate of the
     Partnership  (the  "Offerors"),  filed a tender  offer (the  "Third  Tender
     Offer") with the  Securities and Exchange  Commission,  commencing on March
     27, 2000, to purchase 5,000 of the Partnership's  Limited Partnership Units
     at a price of $6.00  per Unit.  The  Third  Tender  Offer  stated  that the
     Partnership  would  purchase the first 2,500 Units  tendered and would fund
     its purchases and its portion of the expenses from cash  reserves.  If more
     than 2,500 Units were tendered ORIG, LLC would purchase up to an additional
     2,500 Units.  If more than 5,000 Units were tendered,  the Offerors had the
     option to  acquire  the  additional  Units on a pro rata  basis.  The Third
     Tender Offer was scheduled to expire on June 27, 2000.

                                        7

<PAGE>

7.   Tender Offer - Continued
     ------------------------

     On June 23, 2000, the  Partnership  and ORIG, LLC filed an amendment to the
     Third Tender Offer which extended the  expiration  date of the Third Tender
     Offer to August 15, 2000.

     On August 15, 2000 the Third Tender Offer expired.  A total of 39,220 Units
     were tendered and the Offerors accepted all Units tendered. The Partnership
     repurchased 2,500 Units at a cost of $15,000 and ORIG, LLC purchased 36,720
     Units at a cost of $220,320.  The expenses associated with the Third Tender
     Offer were approximately  $19,040 of which the Partnership  incurred $1,257
     and ORIG  incurred  $17,783.  Units  acquired  by the  Partnership  will be
     retired.  Units  acquired  by  ORIG,  LLC will be held by it.  The  General
     Partner,  NTS-Properties  Associates  VII, did not participate in the Third
     Tender Offer.

8.   Related Party Transactions
     --------------------------

     Pursuant to an agreement with the Partnership,  NTS Development Company, an
     affiliate  of the General  Partner of the  Partnership,  receives  property
     management fees on a monthly basis. The fees are paid in an amount equal to
     5% of the gross  revenues  from the  residential  properties  and 6% of the
     gross revenues from the commercial property. Also pursuant to an agreement,
     NTS Development Company receives a repair and maintenance fee equal to 5.9%
     of costs  incurred which relate to capital  improvements.  These repair and
     maintenance fees are capitalized as part of land, buildings and amenities.

     The  Partnership  was charged the  following  amounts from NTS  Development
     Company  for the nine  months  ended  September  30,  2000 and 1999.  These
     charges  include  items which have been  expensed as  operating  expenses -
     affiliated or  professional  and  administrative  expenses - affiliated and
     items which have been capitalized as other assets or as land, buildings and
     amenities.

<TABLE>

                                                                                       Nine Months Ended
                                                                                         September 30,
                                                                          -------------------------------------------
                                                                                 2000                     1999
                                                                          ------------------       ------------------
<S>                                                                        <C>                      <C>
Property management fees                                                   $          76,268        $          76,514
                                                                            ----------------         ----------------

     Total property management fees                                                   76,268                   76,514
                                                                            ----------------         ----------------

Property management                                                                  111,250                  106,202
Leasing                                                                               18,952                   30,049
Administrative - operating                                                            55,111                   61,161
Other                                                                                  1,101                      225
                                                                            ----------------         ----------------

     Total operating expenses -affiliated                                            186,414                  197,637
                                                                            ----------------         ----------------

Administrative - professional                                                         63,667                   53,549
                                                                            ----------------         ----------------

     Total professional and administrative expenses - affiliated                      63,667                   53,549
                                                                            ----------------         ----------------

Repairs and maintenance fee                                                            7,774                    4,295
Construction management                                                                  116                        -
                                                                            ----------------         ----------------

     Total related party transactions capitalized                                      7,890                    4,295
                                                                            ----------------         ----------------

     Total related party transactions                                      $         334,239        $         331,995
                                                                            ================         ================

</TABLE>

                                       8

<PAGE>

8.   Related Party Transactions - Continued
     --------------------------------------

     On February 7, 2000, ORIG, LLC (the "Affiliate") purchased Interests in the
     Partnership  and pursuant to an Agreement,  Bill of Sale and  Assignment by
     and  among  the  Affiliate  and  four  investors  in the  Partnership  (the
     "Purchase  Agreement").  The  Affiliate  purchased  2,251  Interests in the
     Partnership  for a total  consideration  of $15,082 or an average  price of
     $6.70 per Interest.  The Affiliate paid these investors a premium above the
     purchase price  previously  offered for Interests  pursuant to prior tender
     offers because this purchase allowed the Affiliate to purchase  substantial
     numbers of Interests  without  incurring the significant  expenses involved
     with a tender offer and multiple transfers.

9.   Commitments and Contingencies
     -----------------------------
     The  Partnership,  as an  owner  of real  estate,  is  subject  to  various
     environmental laws of the federal and local governments.  Compliance by the
     Partnership with existing laws has not had a material adverse effect on the
     Partnership's  financial condition and results of operations.  However, the
     Partnership cannot predict the impact of new or changed laws or regulations
     on its  current  properties  or on  properties  that it may  acquire in the
     future.

     The Partnership does not believe there is any litigation threatened against
     the Partnership other than routine  litigation  arising out of the ordinary
     course of business,  some of which is expected to be covered by  insurance,
     none  of  which  is  expected  to have a  material  adverse  effect  on the
     consolidated financial statements of the Partnership.

     The Partnership  plans to replace the roofs at Park Place  Apartments Phase
     II (17 buildings) all of which were installed using shingles  produced by a
     single manufacturer. The shingles appear to contain defects which may cause
     them  to  fail  before  the  end of  their  expected  useful  life.  As the
     manufacturer has declared bankruptcy, the Partnership does not expect to be
     able to recover any of the costs of the roof replacements.  The Partnership
     does  not  have  sufficient  working  capital  to  make  all  of  the  roof
     replacements at once and intends to make the replacements  over the next 36
     months.  The total costs of  replacing  all of the roofs is estimated to be
     $340,000  ($20,000  per  building).  As of  September  30,  2000,  no  roof
     replacements have been started.

10.  Segment Reporting
     -----------------

     The Partnership's  reportable  operating  segments include  residential and
     commercial real estate operations. The residential operations represent the
     Partnership's   ownership  and  operating  results  relative  to  apartment
     communities  known as The Park at the  Willows  and Park  Place  Apartments
     Phase II. The commercial  operations represent the Partnership's  ownership
     and operating results relative to suburban commercial office space known as
     Blankenbaker Business Center 1A.

                                       9

<PAGE>

10.  Segment Reporting - Continued
     -----------------------------

     The financial information of the operating segments has been prepared using
     a management  approach,  which is  consistent  with the basis and manner in
     which the Partnership's management internally reports financial information
     for  the  purposes  of  assisting  in  making  operating   decisions.   The
     Partnership's   management  evaluated   performance  based  on  stand-alone
     operating segment net income.

<TABLE>

                                                                   Three Months Ended September 30, 2000
                                                          -------------------------------------------------------

                                                            Residential         Commercial            Total
                                                          ---------------    ----------------   -----------------
<S>                                                         <C>                 <C>                  <C>
Rental income                                               $     417,577       $      71,891        $    489,468
Interest and other income                                           4,257                  48               4,305
                                                             ------------        ------------         -----------

     Total net revenues                                     $     421,834       $      71,939        $    493,773
                                                             ------------        ------------         -----------

Operating expenses and operating expenses -
  affiliated                                                $     200,271       $      10,259        $    210,530
Loss on disposal of assets                                         34,690                   -              34,690
Interest expense                                                   70,474              19,050              89,524
Management fees                                                    21,910               4,438              26,348
Real estate taxes                                                  21,925               7,929              29,854
Depreciation and amortization                                      88,728              22,889             111,617
                                                             ------------        ------------         -----------

     Total expenses                                         $     437,998       $      64,565        $    502,563
                                                             ------------        ------------         -----------

     Net (loss)  income                                     $     (16,164)      $       7,374        $     (8,790)
                                                             ============        ============         ===========

</TABLE>

<TABLE>

                                                                   Three Months Ended September 30, 1999
                                                          --------------------------------------------------------

                                                            Residential          Commercial            Total
                                                          ---------------     -----------------   ----------------
<S>                                                         <C>                   <C>                 <C>
Rental income                                               $     443,241         $      71,651       $    514,892
Interest and other income                                           1,069                     -              1,069
                                                             ------------          ------------        -----------

     Total net revenues                                     $     444,310         $      71,651       $    515,961
                                                             ------------          ------------        -----------

Operating expenses and operating expenses -
  affiliated                                                $     173,157         $      10,541       $    183,698
Interest expense                                                        -                21,896             21,896
Management fees                                                    23,525                 4,203             27,728
Real estate taxes                                                  22,710                 4,426             27,136
Depreciation and amortization                                      89,385                22,902            112,287
                                                             ------------          ------------        -----------

     Total expenses                                         $     308,777         $      63,968       $    372,745
                                                             ------------          ------------        -----------

     Net income                                             $     135,533         $       7,683       $    143,216
                                                             ============          ============        ===========

</TABLE>

                                        10

<PAGE>

10.  Segment Reporting  - Continued
     ------------------------------

<TABLE>

                                                                   Nine Months Ended September 30, 2000
                                                          -------------------------------------------------------

                                                            Residential         Commercial            Total
                                                          ---------------    ----------------   -----------------
<S>                                                          <C>                 <C>                  <C>
Rental income                                                $  1,219,186        $    212,555         $ 1,431,741
Interest and other income                                           7,132                  98               7,230
Gain on sale of assets                                              4,118                   -               4,118
                                                              -----------         -----------          ----------

     Total net revenues                                      $  1,230,436        $    212,653         $ 1,443,089
                                                              -----------         -----------          ----------

Operating expenses and operating expenses -
  affiliated                                                 $    474,362        $     26,639         $   501,001
Loss on disposal of assets                                         54,532                  76              54,608
Interest expense                                                  211,470              59,254             270,724
Management fees                                                    63,630              12,638              76,268
Real estate taxes                                                  67,580              16,859              84,439
Depreciation and amortization                                     263,648              68,676             332,324
                                                              -----------         -----------          ----------

     Total expenses                                          $  1,135,222        $    184,142         $ 1,319,364
                                                              -----------         -----------          ----------

     Net income                                              $     95,214        $     28,511         $   123,725
                                                              ===========         ===========          ==========

</TABLE>

<TABLE>

                                                                   Nine Months Ended September 30, 1999
                                                          -------------------------------------------------------

                                                            Residential         Commercial            Total
                                                          ---------------    ----------------   -----------------
<S>                                                          <C>                 <C>                 <C>
Rental income                                                $  1,239,560        $    220,779        $  1,460,339
Interest and other income                                           7,068                   7               7,075
                                                              -----------         -----------          ----------

     Total net revenues                                      $  1,246,628        $    220,786        $  1,467,414
                                                              -----------         -----------          ----------

Operating expenses and operating expenses -
  affiliated                                                 $    467,653        $     31,750        $    499,403
Interest expense                                                        -              67,612              67,612
Management fees                                                    63,596              12,918              76,514
Real estate taxes                                                  68,130              13,277              81,407
Depreciation and amortization                                     279,379              68,707             348,086
                                                              -----------         -----------         -----------

     Total expenses                                          $    878,758        $    194,264        $  1,073,022
                                                              -----------         -----------         -----------

     Net income                                              $    367,870        $     26,522        $    394,392
                                                              ===========         ===========         ===========

</TABLE>

                                       11

<PAGE>

10.  Segment Reporting  - Continued
     ------------------------------

     A reconciliation  of the totals reported for the operating  segments to the
     applicable  line items in the  consolidated  financial  statements  for the
     three months and nine months ended September 30, 2000 and 1999 is necessary
     given amounts  recorded at the  Partnership  level and not allocated to the
     operating properties for internal reporting purposes.

<TABLE>

                                                                            Three Months Ended September 30,
                                                                        -----------------------------------------
                                                                               2000                   1999
                                                                        ------------------     ------------------
NET REVENUES
------------
<S>                                                                     <C>                    <C>
Total revenues for reportable segments                                  $          493,773     $          515,961
Other income for Partnership                                                         6,698                  3,436
                                                                         -----------------      -----------------

     Total consolidated net revenues                                    $          500,471     $          519,397
                                                                         =================      =================

INTEREST EXPENSE
----------------
Interest expense for reportable segments                                $           89,524     $           21,896
Interest expense for Partnership                                                         -                 72,879
                                                                         -----------------      -----------------

     Total interest expense                                             $           89,524     $           94,775
                                                                         =================      =================

DEPRECIATION AND AMORTIZATION
-----------------------------
Total depreciation and amortization for reportable segments             $          111,617     $          112,287
Depreciation and amortization for Partnership                                        7,633                  7,624
Eliminations                                                                        (3,929)                (3,922)
                                                                         -----------------      -----------------

     Total depreciation and amortization                                $          115,321     $          115,989
                                                                         =================      =================

NET INCOME (LOSS)
----------------
Total net (loss) income for reportable segments                         $           (8,790)    $          143,216
Net loss for Partnership                                                           (28,967)              (118,453)
Eliminations                                                                        (3,445)                (3,760)
                                                                         -----------------      -----------------

     Total net (loss) income                                            $          (41,202)    $           21,003
                                                                         =================      =================

</TABLE>

                                       12

<PAGE>

10.  Segment Reporting  - Continued
     ------------------------------

<TABLE>

                                                                            Nine Months Ended September 30,
                                                                      -------------------------------------------
                                                                              2000                   1999
                                                                      --------------------    -------------------
NET REVENUES
------------
<S>                                                                   <C>                      <C>
Total revenues for reportable segments                                $          1,443,089     $        1,467,414
Other income for Partnership                                                        17,590                 10,527
                                                                       -------------------      -----------------

     Total consolidated net revenues                                  $          1,460,679     $        1,477,941
                                                                       ===================      =================

INTEREST EXPENSE
----------------
Interest expense for reportable segments                              $            270,724     $           67,612
Interest expense for Partnership                                                         -                218,591
                                                                       -------------------      -----------------

     Total interest expense                                           $            270,724     $          286,203
                                                                       ===================      =================

DEPRECIATION AND AMORTIZATION
-----------------------------
Total depreciation and amortization for reportable segments           $            332,324     $          348,086
Depreciation and amortization for Partnership                                       23,087                 21,508
Eliminations                                                                       (11,766)               (11,764)
                                                                       -------------------      -----------------

     Total depreciation and amortization                              $            343,645     $          357,830
                                                                       ===================      =================

NET INCOME (LOSS)
----------------
Total net income for reportable segments                              $            123,725     $          394,392
Net loss for Partnership                                                          (107,199)              (336,554)
Eliminations                                                                       (16,745)               (14,759)
                                                                       -------------------      -----------------

     Total net (loss)  income                                         $               (219)    $           43,079
                                                                       ===================      =================

</TABLE>

11.  Recent Accounting Pronouncement
     -------------------------------

     The  Emerging  Issues  Task  Force  ("EITF")  of the  Financial  Accounting
     Standards  Board  ("FASB")  has  reached a  consensus  on Issue  No.  00-1,
     "Applicability  of the Pro Rata Method of  Consolidation  to Investments in
     Certain  Partnerships  and Other  Unincorporated  Joint Ventures." The EITF
     reached  a  consensus  that  a  proportionate   gross  financial  statement
     presentation   (referred  to  as   "proportionate   consolidation"  in  the
     Partnership's  1999  Form  10-K  Notes  to  Financial  Statements)  is  not
     appropriate for an investment in an  unincorporated  legal entity accounted
     for by the equity  method of  accounting,  unless the investee is in either
     the  construction  industry  or an  extractive  industry  where  there is a
     longstanding practice of its use.

     The  consensus is  applicable to financial  statements  for annual  periods
     ending  after  June  15,  2000.  Upon  application  of the  consensus,  all
     comparative  financial  statements  shall be restated  to conform  with the
     consensus.  The  application  of  this  consensus  will  not  result  in  a
     restatement  of  previously   reported   partners'  equity  or  results  of
     operations,  but will result in a recharacterization or reclassification of
     certain financial  statements'  captions and amounts. The Partnership plans
     to restate its financial  statements using the equity method to account for
     its joint venture investments for the year ending December 31, 2000.

                                       13

<PAGE>

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

Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations  ("MD&A") is  structured  in four major  sections.  The first section
provides  information  related to  occupancy  levels and rental and other income
generated  by the  Partnership's  properties.  The  second  analyzes  results of
operations on a consolidated basis. The final sections address consolidated cash
flows and  financial  condition.  A  discussion  of  certain  market  risks also
follows.  MD&A should be read in  conjunction  with the Financial  Statements in
Item 1 and the Cautionary Statements below.

Cautionary Statements
---------------------

Some  of  the  statements  included  in  this  Item 2 may  be  considered  to be
"forward-looking  statements" since such statements relate to matters which have
not yet occurred.  For example,  phrases such as "the Partnership  anticipates,"
"believes"  or   "expects,"   indicate  that  it  is  possible  that  the  event
anticipated,  believed or expected  may not occur.  Should such event not occur,
then the result which the Partnership  expected also may not occur or occur in a
different  manner,  which may be more or less favorable to the Partnership.  The
Partnership does not undertake any obligations to publicly release the result of
any revision to these forward-looking statements that may be made to reflect any
future events or circumstances.

Any  forward-looking  statements  included in MD&A, or elsewhere in this report,
which reflect management's best judgement, based on factors known, involve risks
and uncertainties. Actual results could differ materially from those anticipated
in any  forward-looking  statements as a result of a number of factors including
but not  limited  to those  discussed  below.  Any  forward-looking  information
provided by the  Partnership  pursuant to the safe harbor  established by recent
securities legislation should be evaluated in the context of these factors.

The  Partnership's  liquidity,  capital  resources and results of operations are
subject to a number of risks and uncertainties including, but not limited to the
following:  the ability of the  Partnership  to achieve  planned  revenues;  the
ability of the Partnership to make payments due under its debt  agreements;  the
ability of the  Partnership  to negotiate  and  maintain  terms with vendors and
service providers for operating expenses;  competitive pressures from other real
estate  companies,  including  large  commercial  and  residential  real  estate
companies,  which may  affect  the nature  and  viability  of the  Partnership's
business  strategy;  trends in the economy as a whole which may affect  consumer
confidence and demand for the types of rental property held by the  Partnership;
the  ability of the  Partnership  to predict  the  demand  for  specific  rental
properties;  the  ability  of the  Partnership  to attract  and retain  tenants;
availability  and costs of management and labor employed;  real estate occupancy
and  development  costs,   including  the  substantial  fixed  investment  costs
associated with renovations  necessary to obtain new tenants and retain existing
tenants;  and the risk of a major commercial  tenant defaulting on its lease due
to risks  generally  associated  with real estate,  many of which are beyond the
control of the  Partnership,  including  general or local  economic  conditions,
competition, interest rates, real estate tax rates, other operating expenses and
acts of God.

                                       14

<PAGE>

Results of Operations
---------------------

The occupancy levels at the Partnership's  properties as of September 30 were as
follows:

<TABLE>
                                                                                 Nine Months Ended September 30,
                                                                         -----------------------------------------------
                                                                                2000                        1999
                                                                         -------------------         -------------------
Wholly-owned Properties
-----------------------
<S>                                                                              <C>                         <C>
The Park at the Willows                                                          92%                         90%
Park Place Apartments Phase II (1)                                               83%                         92%

Property Owned in Joint Venture with NTS-Properties IV and
----------------------------------------------------------
NTS-Properties Plus, Ltd. (Ownership % at September 30, 2000)
-------------------------------------------------------------

Blankenbaker Business Center 1A (31.34%)                                        100%                        100%

</TABLE>

(1)  In the opinion of the General Partner of the  Partnership,  the decrease in
     occupancy  is  only a  temporary  fluctuation  and  does  not  represent  a
     permanent downward occupancy trend.

The average  occupancy levels at the  Partnership's  properties during the three
months and nine months ended September 30 were as follows:

<TABLE>
                                                                         Three Months Ended             Nine Months Ended
                                                                           September 30,                  September 30,
                                                                    ----------------------------    --------------------------
                                                                        2000            1999           2000           1999
                                                                    ------------     -----------    -----------    -----------
Wholly-owned Properties
-----------------------
<S>                                                                    <C>              <C>            <C>            <C>
The Park at the Willows (1)                                             86%              89%            77%            91%
Park Place Apartments Phase II (1)                                      85%              91%            85%            86%

Property Owned in Joint Venture with NTS-Properties IV and
----------------------------------------------------------
NTS-Properties Plus, Ltd. (Ownership % at September 30,
-------------------------------------------------------
2000)
-----

Blankenbaker Business Center 1A (31.34%)                                100%            100%           100%           100%

</TABLE>

(1)  In the opinion of the General Partner of the  Partnership,  the decrease in
     average occupancy is only a temporary  fluctuation and does not represent a
     permanent downward occupancy trend.

Rental and other income generated by the Partnership's  properties for the three
months and nine months ended September 30 were as follows:

<TABLE>
                                                                    Three Months Ended         Nine Months Ended
                                                                      September 30,              September 30,
                                                                 ------------------------  -------------------------
                                                                    2000         1999          2000         1999
                                                                 ----------  ------------  ------------ ------------
Wholly-owned Properties
-----------------------
<S>                                                              <C>         <C>           <C>          <C>
The Park at the Willows                                          $   76,514  $     83,292  $    222,837 $    256,704
Park Place Apartments Phase II                                   $  345,320  $    361,019  $  1,007,598 $    989,924

Property Owned in Joint Venture with NTS-Properties IV
and NTS-Properties Plus, Ltd. (Ownership % at
September 30, 2000)

Blankenbaker Business Center 1A (31.34%) (1)                     $   71,939  $     71,651  $    212,653 $    220,786

</TABLE>

(1)  Revenues shown in this table represent the Partnership's  share of revenues
     generated by Blankenbaker Business Center 1A. The Partnership's  percentage
     interest in the Joint  Venture was 31.34%  during the three months and nine
     months ended September 30, 2000 and 1999.

                                       15

<PAGE>

Results of Operations - Continued
---------------------------------

Current  occupancy  levels are considered  adequate to continue the operation of
the Partnership's  properties without the need of any additional financing.  See
the  Consolidated  Cash Flows and  Financial  Condition  section of Item 2 for a
discussion  regarding the cash  requirements of the  Partnership's  current debt
financings.

It is the  Partnership's  understanding  that  SHPS,  Inc.  does not  intend  to
continue  to occupy the space at  Blankenbaker  Business  Center 1A through  the
duration  of its lease,  ending in July 2005.  The  Partnership's  proportionate
share of the rental income from this property accounted for approximately 14% of
the  Partnership's  total revenues for the nine months ended September 30, 2000.
The Partnership has not yet determined the effect,  if any, on the Partnership's
operations,  given the fact SHPS,  Inc.  is under  lease  until July 2005 and no
official notice of termination has been received.

The  following is an analysis of material  changes in the results of  operations
for the periods  ending  September 30, 2000 and 1999.  Items that did not have a
material  impact on operations  for the periods  listed above have been excluded
from this discussion.

Other income  increased  approximately  $6,500 or 144% and $7,200 or 41% for the
three months and nine months ended September 30, 2000, respectively, as compared
to the same periods in 1999, mainly as a result of increased  interest earned on
bank accounts.

Operating expenses increased  approximately  $27,800 or 24% for the three months
ended  September 30, 2000,  as compared to the same period in 1999,  mainly as a
result of increased repair and maintenance  costs at Park Place Apartments Phase
II, which consisted of increased wood replacement  partially offset by decreased
roof  repairs and floor  covering.  The  increase is also a result of  increased
landscaping  costs at Park Place Apartments  Phase II and Blankenbaker  Business
Center  1A and  increased  pool  maintenance  at The  Park at the  Willows.  The
increase is partially offset by decreased cable expense at Park Place Apartments
Phase II  (starting in the year 2000  residents  are  responsible  for their own
cable) and decreased landscaping at The Park at the Willows.

Operating expenses - affiliated  decreased  approximately  $11,200 or 6% for the
nine months ended September 30, 2000, as compared to the same period in 1999, as
a result of decreased personnel costs at Park Place Apartments Phase II due to a
portion of these costs being allocated to Park Place Apartments Phase III, which
was not in full  operation  as of  September  30,  1999.  The decrease is also a
result of decreased overhead costs allocated at Blankenbaker  Business Center 1A
due to personnel  status changes.  Operating  expenses - affiliated are expenses
incurred for services  performed by  employees of NTS  Development  Company,  an
affiliate of the General Partner.

The loss on  disposal  of assets of  approximately  $54,608  for the nine months
ended  September 30, 2000,  is the result of the  retirement of assets that were
not fully depreciated. The retirements were the result of a clubhouse renovation
project at Park Place Apartments  Phase II and exterior  renovations at The Park
at The Willows. The loss on disposal of assets of approximately  $34,690 for the
three months ended  September 30, 2000, is a result of the clubhouse  renovation
project at Park Place Apartments Phase II.

                                       16

<PAGE>

Results of Operations - Continued
---------------------------------

Interest expense decreased approximately $5,300 or 6% and $15,500 or 5 % for the
three months and nine months ended September 30, 2000, respectively, as compared
to the same periods in 1999. This decrease is due to principal  payments made on
mortgages payable.

Professional and administrative  expenses decreased approximately $17,500 or 56%
and $13,400 or 17% for the three  months and nine  months  ended  September  30,
2000,  respectively,  as compared to the same periods in 1999.  This decrease is
due  primarily  to  decreased  legal  fees  related  to tender  offers,  outside
accounting fees and printing expense related to tender offers.

Professional and administrative  expenses - affiliated  increased  approximately
$3,800 or 22% and  $10,100  or 19% for the three  months and nine  months  ended
September  30,  2000,  respectively,  as compared  to the same  periods in 1999,
primarily  as a  result  of  increased  finance  and  accounting  salary  costs.
Professional and administrative  expenses - affiliated are expenses incurred for
services performed by employees of NTS Development  Company, an affiliate of the
General Partner.

Depreciation and amortization expense decreased  approximately $14,200 or 4% for
the nine months  ended  September  30,  2000,  as compared to the same period in
1999, as a result of assets with shorter lives at the Partnership's  residential
properties having become fully depreciated. The decrease is also a result of the
sale of clubhouse  furniture,  of which some was not fully depreciated,  at Park
Place  Apartments  Phase II. The decrease is partially offset by the addition of
clubhouse renovation costs, fitness center renovation costs,  landscaping costs,
and the cost of a traffic light at Park Place  Apartments Phase II, and exterior
renovation costs at The Park at the Willows.

Depreciation  is computed  using the  straight-line  method  over the  estimated
useful  lives of the  assets  which are 7-30 years for land  improvements,  5-30
years  for  buildings  and  improvements,  5-30  years  for  amenities  and  the
applicable  lease  term  for  tenant  improvements.  The  aggregate  cost of the
Partnership's properties for Federal tax purposes is approximately $13,920,000.

Consolidated Cash Flows and Financial Condition
-----------------------------------------------
Cash flows provided by (used in):

<TABLE>

                                                                            Nine Months Ended September 30,
                                                                    ------------------------------------------------
                                                                            2000                        1999
                                                                    ---------------------       --------------------
<S>                                                                 <C>                         <C>
Operating activities                                                $              454,911      $            511,783
Investing activities                                                              (164,317)                  (73,745)
Financing activities                                                              (258,402)                 (379,765)
                                                                     ---------------------       -------------------

     Net increase in cash and equivalents                           $               32,192      $             58,273
                                                                     =====================       ===================

</TABLE>

Net cash provided by operating activities decreased approximately $56,900 or 11%
for the nine months ended  September 30, 2000, as compared to the same period in
1999.  The  decrease in net cash  provided by  operating  activities  was driven
primarily by decreased  net income,  increased  prepaid  expenses and  decreased
accounts payable in 2000. The decrease is partially offset by increased property
tax payable, which is included in other liabilities, and increased collection of
accounts receivable.

                                       17

<PAGE>

Consolidated Cash Flows and Financial Condition - Continued
-----------------------------------------------------------

The increase in net cash used in investing  activities for the nine months ended
September  30,  2000,  as compared  to the same  period in 1999,  was mainly the
result of increased capital  expenditures for the clubhouse,  fitness center and
exterior  renovation  projects  at Park  Place  Apartments  Phase II and  studio
renovations at The Park at the Willows.

The decrease in net cash used in financing  activities for the nine months ended
September 30, 2000, as compared to the same period in 1999,  was mainly a result
of 1) a decrease in cash  restricted for the  repurchase of Limited  Partnership
Units,  2) a decrease in  distributions  paid (3rd  Quarter  2000  distributions
declared were not paid until October  2000),  and 3) a decrease in the number of
Limited  Partnership  Units  repurchased.  The decrease is  partially  offset by
increased principal payments made on mortgages payable.

During the nine months ended September 30, 2000 and 1999, the  Partnership  used
cash flow from  operations  and cash on hand to declare a 1%  (annualized)  cash
distribution of $84,076 (2000) and $85,718 (1999), respectively.  The annualized
distribution   rate  is  calculated  as  a  percent  of  the  original   capital
contribution. The Limited Partners received 99% and the General Partner received
1%  of  these  distributions.   The  primary  source  of  future  liquidity  and
distributions is expected to be derived from cash generated by the Partnership's
properties  after  adequate cash reserves are  established  for future  leasing,
renovations and tenant finish costs. It is anticipated  that the cash flows from
operations  and  cash  reserves  will be  sufficient  to meet  the  needs of the
Partnership. Cash reserves (which are unrestricted cash and equivalents as shown
on the Partnership's balance sheet) were $432,454 at September 30, 2000.

The table below  presents  that portion of the  distributions  that  represent a
return of capital on a GAAP basis for the nine months ended  September  30, 2000
and 1999.

<TABLE>

                                                       Net Income            Cash Distributions            Return of
                                                        Allocated                 Declared                  Capital
                                                  ---------------------    ----------------------    ----------------------
Limited Partners:
                    <S>                           <C>                      <C>                       <C>
                    2000                          $                (217)   $               83,235    $               83,235
                    1999                          $              42,648    $               84,861    $               42,213

General Partner:
                    2000                          $                  (2)   $                  841    $                  841
                    1999                          $                 431    $                  857    $                  426

</TABLE>

The demand on future  liquidity  is  anticipated  to increase as a result of the
replacement of the roofs at Park Place Apartments Phase II (17 buildings) all of
which were  installed  using  shingles  produced by a single  manufacturer.  The
shingles  appear to contain  defects which may cause them to fail before the end
of their expected useful life. As the manufacturer has declared bankruptcy,  the
Partnership  does not expect to be able to recover  any of the costs of the roof
replacements.  The Partnership does not have sufficient  working capital to make
all of the roof  replacements at once and intends to make the replacements  over
the next 36 months.  The total costs of replacing  all of the roofs is estimated
to be $340,000  ($20,000  per  building).  As of  September  30,  2000,  no roof
replacements have been started.

                                       18

<PAGE>

Consolidated Cash Flows and Financial Condition - Continued
-----------------------------------------------------------

On  March  24,  2000,  the  Partnership  and  ORIG,  LLC,  an  affiliate  of the
Partnership  (the  "Offerors"),  filed a tender offer (the "Third Tender Offer")
with the  Securities and Exchange  Commission,  commencing on March 27, 2000, to
purchase  5,000 of the  Partnership's  Limited  Partnership  Units at a price of
$6.00 per  Unit.  The Third  Tender  Offer  stated  that the  Partnership  would
purchase  the first 2,500 Units  tendered  and would fund its  purchase  and its
portion  of the  expenses  from cash  reserves.  If more than  2,500  Units were
tendered, ORIG, LLC would purchase up to an additional 2,500 Units. If more than
5,000 Units were tendered, the Offerors had the option to acquire the additional
Units on a pro rata basis.  The Third  Tender  Offer was  scheduled to expire on
June 27, 2000.

On June 23, 2000, the  Partnership and ORIG, LLC filed an amendment to the Third
Tender  Offer which  extended the  expiration  date of the Third Tender Offer to
August 15, 2000.

On August 15, 2000 the Third Tender Offer expired.  A total of 39,220 Units were
tendered  and  the  Offerors  accepted  all  Units  tendered.   The  Partnership
repurchased  2,500 Units at a costs of $15,000 and ORIG,  LLC  purchased  36,720
Units at a cost of $220,320. The expenses associated with the Third Tender Offer
were  approximately  $19,040 of which the  Partnership  incurred $1,257 and ORIG
incurred  $17,783.  Units  acquired by the  Partnership  will be retired.  Units
acquired by ORIG,  LLC will be held by it. The General  Partner,  NTS-Properties
Associates VII, did not participate in the Third Tender Offer.

In an  effort to  continue  to  improve  occupancy  levels at the  Partnership's
residential  properties,  the Partnership has an on-site leasing staff,  who are
employees of NTS Development Company, at each of the apartment communities.  The
staff  handles all on-site  visits from  potential  tenants,  coordinates  local
advertising  with NTS Development  Company's  marketing  staff,  makes visits to
local  companies to promote fully  furnished  apartments  and works with current
residents on lease renewals.

The  lease at  Blankenbaker  Business  Center  1A  provides  for the  tenant  to
contribute toward the payment of common area expenses, insurance and real estate
taxes.  This lease provision,  along with the fact that  residential  leases are
generally for a period of one year, should protect the Partnership's  operations
from the impact of inflation and changing prices.

                                       19

<PAGE>

Item 3. Quantitative and Qualitative Disclosures About Market Risk
        ----------------------------------------------------------

Our primary risk  exposure  with regard to financial  instruments  is changes in
interest rates. All of the Partnership's debt bears interest at a fixed rate. At
September 30, 2000, a  hypothetical  100 basis point  increase in interest rates
would result in an approximate $234,000 decrease in the fair value of debt.

                                       20

<PAGE>

PART II.          OTHER INFORMATION
                  -----------------

Item 1.           Legal Proceedings
                  -----------------

                  Not applicable.

Item 2.           Changes in Securities
                  ---------------------

                  Not applicable.

Item 3.           Defaults Upon Senior Securities
                  -------------------------------

                  Not applicable.

Item 4.           Submission of Matters to a Vote of Security Holders
                  ---------------------------------------------------

                  Not applicable.

Item 5.           Other Information
                  -----------------

                  Not applicable.

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

                  a)       Exhibits:

                           Exhibit 27. Financial Data Schedule

                  b)       Reports on Form 8-K:

                           Not applicable.

                                       21

<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.

                                             NTS-Properties VII, Ltd.
                                 -----------------------------------------------
                                                  (Registrant)

                                 By:      NTS-Properties Associates VII,
                                          General Partner
                                          By:      NTS Capital Corporation,
                                                   General Partner



                                 /s/ Gregory A. Wells
                                 -----------------------------------------------
                                 Gregory A. Wells
                                 Senior Vice President and
                                 Chief Financial Officer of
                                 NTS Capital Corporation



Date: November 13, 2000

                                       22

<PAGE>