FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

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

               For the quarterly period ended September 30, 2001
   --------------------------------------------------------------------------

                                       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
                                     0-19139
                     ---------------------------------------


                           CNL Income Fund VIII, Ltd.
------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


         Florida                                        59-2963338
------------------------------------           -------------------------------
(State or other jurisdiction of                       (I.R.S. Employer
incorporation or organization)                       Identification No.)


450 South Orange Avenue
Orlando, Florida                                           32801
------------------------------------           -------------------------------
(Address of principal executive offices)                (Zip Code)


Registrant's telephone number
(including area code)                                 (407) 540-2000
                                               -------------------------------


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by  Sections  13 or 15(d)  of the  Securities  Exchange  Act of 1934
during the preceding 12 months (or for such shorter  period that the  registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for the past 90 days. Yes X No _________




<PAGE>


                                    CONTENTS




                                                                       Page
Part I.

     Item 1.      Financial Statements:

                      Condensed Balance Sheets                          1

                      Condensed Statements of Income                    2

                      Condensed Statements of Partners' Capital         3

                      Condensed Statements of Cash Flows                4

                      Notes to Condensed Financial Statements           5-8

     Item 2.      Management's Discussion and Analysis of Financial
                      Condition and Results of Operations               9-14

     Item 3.      Quantitative and Qualitative Disclosures About
                      Market Risk                                       14

Part II.

     Other Information                                                  15-16

<PAGE>
                           CNL INCOME FUND VIII, LTD.
                         (A Florida Limited Partnership)
                            CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>


                                                                  September 30,             December 31,
                                                                       2001                     2000
                                                                -------------------      -------------------

 <c>
                               ASSETS

   Land and buildings on operating leases, net                        $ 16,205,561             $ 16,275,305
   Net investment in direct financing leases                             5,208,244                6,439,056
   Investment in joint ventures                                          4,628,988                4,075,551
   Mortgage notes receivable                                               939,193                1,424,436
   Cash and cash equivalents                                             2,426,454                1,226,635
   Certificate of deposit                                                  108,749                  461,394
   Receivables, less allowance for doubtful accounts
       of $57,263 and $459, respectively                                    50,100                  105,075
   Due from related parties                                                    133                   30,010
   Prepaid expenses                                                         15,096                   26,288
   Accrued rental income                                                 1,494,666                1,710,973
   Other assets                                                             52,671                   52,671
                                                                -------------------      -------------------

                                                                      $ 31,129,855             $ 31,827,394
                                                                ===================      ===================

                  LIABILITIES AND PARTNERS' CAPITAL

   Accounts payable                                                     $    9,085               $   34,293
   Accrued and escrowed real estate taxes payable                           28,624                   12,501
   Distributions payable                                                   787,501                  787,501
   Due to related parties                                                  113,015                   59,401
   Rents paid in advance                                                    25,355                   72,646
                                                                -------------------      -------------------
       Total liabilities                                                   963,580                  966,342

   Minority interest                                                       107,431                  108,518

   Partners' capital                                                    30,058,844               30,752,534
                                                                -------------------      -------------------

                                                                      $ 31,129,855             $ 31,827,394
                                                                ===================      ===================
</TABLE>
           See accompanying notes to condensed financial statements.

<PAGE>


                           CNL INCOME FUND VIII, LTD.
                         (A Florida Limited Partnership)
                         CONDENSED STATEMENTS OF INCOME

<TABLE>
<CAPTION>
                                                                     Quarter Ended                 Nine Months Ended
                                                                     September 30,                   September 30,
                                                                 2001              2000           2001           2000
                                                             -------------     -------------  -------------  -------------

 <c>
Revenues:
    Rental income from operating leases                         $ 478,329         $ 481,549    $ 1,473,937     $1,470,044
    Adjustments to accrued rental income                               --                --       (211,335 )     (123,370 )
    Earned income from direct financing leases                    163,806           216,819        525,349        663,305
    Contingent rental income                                        5,129             6,153         22,097         23,331
    Interest and other income                                      61,696            79,421        236,399        206,839
                                                             -------------     -------------  -------------  -------------
                                                                  708,960           783,942      2,046,447      2,240,149
                                                             -------------     -------------  -------------  -------------

Expenses:
    General operating and administrative                           45,476            54,720        241,280        146,847
    Professional services                                          13,166                --         41,319         28,439
    Real estate taxes                                               3,074             2,032         20,962          7,708
    State and other taxes                                             119                --         51,819         18,228
    Depreciation                                                   82,355            75,338        238,195        225,432
    Transaction costs                                                  --                --             --         67,801
                                                             -------------     -------------  -------------  -------------
                                                                  144,190           132,090        593,575        494,455
                                                             -------------     -------------  -------------  -------------

Income Before Minority Interest in Income of
    Consolidated Joint Venture, Equity in Earnings of
    Unconsolidated Joint Ventures, Gain on Sale of
    Assets, and Provision for Loss on Assets                      564,770           651,852      1,452,872      1,745,694

Minority Interest in Income of Consolidated
    Joint Venture                                                  (3,246 )          (3,350 )       (9,800 )       (9,971 )

Equity in Earnings of Unconsolidated Joint Ventures               107,815            75,397        285,584        213,951

Gain on Sale of Assets                                                 --           612,693         28,301        612,693

Provision for Loss on Assets                                           --                --        (88,144 )           --
                                                             -------------     -------------  -------------  -------------

Net Income                                                      $ 669,339        $1,336,592    $ 1,668,813     $2,562,367
                                                             =============     =============  =============  =============

Allocation of Net Income:
    General partners                                               $   --            $   --         $   --         $   --
    Limited partners                                              669,339         1,336,592      1,668,813      2,562,367
                                                             -------------     -------------  -------------  -------------

                                                                $ 669,339        $1,336,592    $ 1,668,813     $2,562,367
                                                             =============     =============  =============  =============

Net Income Per Limited Partner Unit                             $   0.019         $   0.038       $  0.048      $   0.073
                                                             =============     =============  =============  =============

Weighted Average Number of Limited Partner
    Units Outstanding                                          35,000,000        35,000,000     35,000,000     35,000,000
                                                             =============     =============  =============  =============
</TABLE>
           See accompanying notes to condensed financial statements.

<PAGE>


                           CNL INCOME FUND VIII, LTD.
                         (A Florida Limited Partnership)
                    CONDENSED STATEMENTS OF PARTNERS' CAPITAL
<TABLE>
<CAPTION>
                                                    Nine Months Ended                Year Ended
                                                      September 30,                 December 31,
                                                           2001                         2000
                                                 -------------------------        -----------------

 <c>
General partners:
    Beginning balance                                        $    286,349               $  286,349
    Net income                                                         --                       --
                                                 -------------------------        -----------------
                                                                  286,349                  286,349
                                                 -------------------------        -----------------

Limited partners:
    Beginning balance                                          30,466,185               30,029,018
    Net income                                                  1,668,813                3,587,171
    Distributions ($0.068 and $0.090 per
       limited partner unit, respectively                      (2,362,503 )             (3,150,004 )
                                                 -------------------------        -----------------
                                                               29,772,495               30,466,185
                                                 -------------------------        -----------------

Total partners' capital                                     $  30,058,844             $ 30,752,534
                                                 =========================        =================
</TABLE>
           See accompanying notes to condensed financial statements.

<PAGE>

                           CNL INCOME FUND VIII, LTD.
                         (A Florida Limited Partnership)
                       CONDENSED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
                                                                        Nine Months Ended
                                                                          September 30,
                                                                    2001                2000
                                                                --------------     ---------------

 <c>
Increase (Decrease) in Cash and Cash Equivalents

    Net Cash Provided by Operating Activities                      $2,496,805          $2,411,275
                                                                --------------     ---------------

    Cash Flows from Investing Activities:
       Additions to assets on operating leases                             --          (2,452,976 )
       Proceeds from sale of assets                                   877,000           3,822,716
       Investment in joint ventures                                  (865,942 )          (960,068 )
       Liquidating distribution from joint venture                    236,740                  --
       Collections on mortgage notes receivable                       481,210              36,036
       Redemption of certificates of deposit                          347,396                  --
       Increase in restricted cash                                         --            (417,928 )
                                                                --------------     ---------------
          Net cash provided by investing activities                 1,076,404              27,780
                                                                --------------     ---------------

    Cash Flows from Financing Activities:
       Distributions to limited partners                           (2,362,503 )        (2,362,503 )
       Distributions to holder of minority interest                   (10,887 )            (9,966 )
                                                                --------------     ---------------
          Net cash used in financing activities                    (2,373,390 )        (2,372,469 )
                                                                --------------     ---------------

Net Increase in Cash and Cash Equivalents                           1,199,819              66,586

Cash and Cash Equivalents at Beginning of Period                    1,226,635           1,503,989
                                                                --------------     ---------------

Cash and Cash Equivalents at End of Period                         $2,426,454          $1,570,575
                                                                ==============     ===============

Supplemental Schedule of Non-Cash Financing
    Activities:

       Distributions declared and unpaid at end of
          period                                                    $ 787,501           $ 787,501
                                                                ==============     ===============
</TABLE>
           See accompanying notes to condensed financial statements.

<PAGE>
                           CNL INCOME FUND VIII, LTD.
                         (A Florida Limited Partnership)
                     NOTES TO CONDENSED FINANCIAL STATEMENTS
           Quarters and Nine Months Ended September 30, 2001 and 2000


1.   Basis of Presentation:
     ---------------------

     The  accompanying   unaudited  condensed  financial  statements  have  been
     prepared  in  accordance  with  the  instructions  to Form  10-Q and do not
     include all of the information and note  disclosures  required by generally
     accepted  accounting  principles.  The  financial  statements  reflect  all
     adjustments,  consisting of normal recurring adjustments, which are, in the
     opinion of management, necessary to a fair statement of the results for the
     interim  periods  presented.  Operating  results  for the  quarter and nine
     months ended  September  30, 2001 may not be indicative of the results that
     may be  expected  for the year  ending  December  31,  2001.  Amounts as of
     December 31, 2000, included in the financial statements,  have been derived
     from audited financial statements as of that date.

     These unaudited financial statements should be read in conjunction with the
     financial  statements and notes thereto included in Form 10-K of CNL Income
     Fund VIII, Ltd. (the "Partnership") for the year ended December 31, 2000.

     The Partnership accounts for its approximate 88 percent interest in Woodway
     Joint Venture using the consolidation method.  Minority interest represents
     the minority joint venture partner's  proportionate  share of the equity in
     the Partnership's  consolidated joint venture. All significant intercompany
     accounts and transactions have been eliminated.

2.   Reclassification:
     ----------------

     Certain  items  in  the  prior  year's   financial   statements  have  been
     reclassified to conform to 2001 presentation.  These  reclassifications had
     no effect on total partners' capital or net income.

3.   Land and Buildings on Operating Leases:
     --------------------------------------

     In May 2001,  the  Partnership  sold its  property  in  Statesville,  North
     Carolina, and received net sales proceeds of $877,000,  resulting in a gain
     of approximately $28,300 for financial reporting purposes (see Note 4).


<PAGE>

                           CNL INCOME FUND VIII, LTD.
                         (A Florida Limited Partnership)
                     NOTES TO CONDENSED FINANCIAL STATEMENTS
           Quarters and Nine Months Ended September 30, 2001 and 2000


4.   Net Investment in Direct Financing Leases:
     -----------------------------------------

     The  following  lists  the  components  of the  net  investment  in  direct
     financing leases at:
<TABLE>
<CAPTION>
                                                September 30,          December 30,
                                                    2001                   2000
                                             --------------------   -------------------

 <c>
       Minimum lease payments receivable            $  7,721,337          $ 10,334,143
       Estimated residual values                       1,838,111             2,152,532
       Less unearned income                           (4,351,204 )          (6,047,619 )
                                             --------------------   -------------------

       Net investment in direct financing
            leases                                  $  5,208,244          $  6,439,056
                                             ====================   ===================
</TABLE>

     In May 2001,  the  Partnership  sold a  property,  for  which the  building
     portion had been  classified  as a direct  financing  lease.  In connection
     therewith,  the gross investment (minimum lease payments receivable and the
     estimated residual value) and unearned income relating to the building were
     removed  from the  accounts  and the gain from the sale of the property was
     reflected in income (see Note 3).

     At June 30, 2001, the Partnership established a provision for impairment in
     carrying  value in the amount of  $88,144  for its  property  in North Fort
     Myers,  Florida,  due to the fact that the  tenant  ceased  operations  and
     vacated this property. The provision represented the difference between the
     carrying value of the net investment in the direct  financing lease and the
     general  partners'  estimated net realizable value of the investment in the
     direct  financing lease at June 30, 2001.  During July 2001, this lease was
     terminated  due to the fact that the tenant vacated the property and ceased
     restaurant operations.  As a result, the Partnership reclassified the lease
     from direct financing leases to land and buildings on operating  leases. In
     accordance  with the  Statement of Financial  Accounting  Standards No. 13,
     "Accounting for Leases," the Partnership recorded the reclassified lease at
     the lower of original cost, present fair value, or present carrying amount.
     No loss on the termination of the direct  financing leases was recorded for
     financial reporting purposes.

5.   Investment in Joint Ventures:
     ----------------------------

     In March 2001,  Middleburg  Joint Venture,  in which the Partnership owns a
     12.46%  interest,  sold its property to the tenant,  in accordance with the
     purchase option under the lease agreement, for $1,900,000.  Due to the fact
     that the joint venture had recorded  accrued  rental  income,  representing
     non-cash amounts that the joint venture had

<PAGE>



                           CNL INCOME FUND VIII, LTD.
                         (A Florida Limited Partnership)
                     NOTES TO CONDENSED FINANCIAL STATEMENTS
           Quarters and Nine Months Ended September 30, 2001 and 2000


5.   Investment in Joint Ventures - Continued:
     ----------------------------------------

     recognized  as income  since the  inception  of the lease  relating  to the
     straight-lining  of future  scheduled  rent  increases in  accordance  with
     generally accepted accounting  principles,  a loss of approximately $61,900
     was recorded by the joint venture for financial reporting purposes in March
     2001. The property was originally  contributed to Middleburg  Joint Venture
     in May 1996 and had a total  cost of  approximately  $1,878,860,  excluding
     acquisition fees and miscellaneous  acquisition  expenses.  The Partnership
     dissolved  the joint  venture and did not  recognize  any  gain/loss on the
     dissolution of the joint venture.  As a result,  the  Partnership  received
     approximately $236,700 as a return of capital for its pro-rata share of the
     net sales proceeds.  The Partnership  reinvested the proceeds received as a
     return of capital from  Middleburg  Joint  Venture in another joint venture
     arrangement, as described below.

     In April 2001, the Partnership  reinvested the amounts received as a return
     of  capital  from  Middleburg   Joint  Venture  in  another  joint  venture
     arrangement, CNL VIII, X, XII Kokomo Joint Venture, with CNL Income Fund X,
     Ltd. and CNL Income Fund XII, Ltd., both Florida limited  partnerships  and
     affiliates of the general partners.  The Partnership acquired this interest
     from CNL BB Corp., an affiliate of the general partners (see Note 6). As of
     September 30, 2001, the Partnership had contributed  approximately $211,200
     and has an approximate 10 percent interest in the profits and losses of the
     joint venture.  The  Partnership  accounts for its investment in this joint
     venture under the equity method since the  Partnership  shares control with
     affiliates.

     In June 2001,  the  Partnership  reinvested a portion of the sales proceeds
     from the property in Statesville,  North Carolina,  described  above, in an
     additional  property in Walker,  Louisiana  as  tenants-in-common  with CNL
     Income Fund XVI, Ltd., a Florida  limited  partnership and affiliate of the
     general partners. As of September 30, 2001, the Partnership had contributed
     approximately  $232,300  for a 17 percent  interest  in the  property.  The
     Partnership  accounts for its  investment  in this joint  venture under the
     equity method since the Partnership shares control with an affiliate.

     In July 2001, the  Partnership  reinvested the remaining  sales proceeds it
     received from the sale of the property in Statesville,  North Carolina,  in
     an additional property in Denver, Colorado, as tenants-in-common,  with CNL
     Income Fund XVIII, Ltd., a Florida limited partnership and affiliate of the
     general partners. As of September 30, 2001, the Partnership had contributed
     approximately  $422,600 for a 19.30%  interest in the profits and losses of
     the property.  The Partnership accounts for its investment in this property
     under the  equity  method  since the  Partnership  shares  control  with an
     affiliate.

<PAGE>
                           CNL INCOME FUND VIII, LTD.
                         (A Florida Limited Partnership)
                     NOTES TO CONDENSED FINANCIAL STATEMENTS
           Quarters and Nine Months Ended September 30, 2001 and 2000


5.   Investment in Joint Ventures - Continued:
     ----------------------------------------

     The following presents the combined,  condensed  financial  information for
     all of the Partnerships investments in joint ventures at:
<TABLE>
<CAPTION>
                                                            September 30,             December 31,
                                                                 2001                     2000
                                                           --------------------    -------------------

 <c>
           Land and buildings on operating leases, net          $   14,062,267           $  8,714,670
           Net investment in direct financing lease                    349,548              1,280,255
           Cash                                                         30,853                117,189
           Receivables                                                  16,349                 28,510
           Prepaid expenses                                                587                    566
           Accrued rental income                                       237,412                247,527
           Liabilities                                                   4,841                 80,916
           Partners' capital                                        14,692,175             10,307,801
           Revenues                                                  1,047,330              1,128,453
           Net income                                                  828,428                903,843
</TABLE>

     The Partnership  recognized  income totaling  $285,584 and $213,951 for the
     nine months ended  September  30, 2001 and 2000,  respectively,  from these
     joint  ventures  and  the  properties   held  as   tenants-in-common   with
     affiliates,  $107,815  and $75,397 of which was earned  during the quarters
     ended September 30, 2001 and 2000, respectively.

6.   Related Party Transactions:
     --------------------------

     During the nine months ended  September  30,  2001,  the  Partnership,  CNL
     Income Fund X, Ltd., and CNL Income Fund XII, Ltd., through a joint venture
     agreement,  acquired an interest in a Golden  Corral  property  from CNL BB
     Corp.,  an  affiliate  of the  general  partners,  for a purchase  price of
     $2,112,011.  CNL Income  Fund X, Ltd.  and CNL Income Fund XII,  Ltd.,  are
     Florida limited partnerships and affiliates of the general partners. CNL BB
     Corp. had purchased and temporarily held title to this property in order to
     facilitate the acquisition of the property by the Partnership. The purchase
     price paid by the Partnership represents the costs incurred by CNL BB Corp.
     to acquire and carry the property, including closing costs.


<PAGE>


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

        CNL Income Fund VIII,  Ltd.  (the  "Partnership")  is a Florida  limited
partnership  that was  organized on August 18, 1989 to acquire for cash,  either
directly or through  joint  venture  arrangements,  both newly  constructed  and
existing  restaurants,  as  well  as  land  upon  which  restaurants  were to be
constructed  (the  "Properties"),  which are leased  primarily  to  operators of
national and regional  fast-food and family-style  restaurant chains. The leases
are  triple-net  leases,  with  the  lessees  responsible  for all  repairs  and
maintenance,  property taxes, insurance and utilities. As of September 30, 2001,
the Partnership owned 37 Properties, including interests in ten Properties owned
by joint ventures in which the Partnership is a co-venturer and three Properties
owned with an affiliate as tenants-in-common.

Capital Resources

        The  Partnership's  primary  source of capital for the nine months ended
September  30,  2001 and 2000 was cash  from  operations  (which  includes  cash
received from tenants, distributions from joint ventures, and interest and other
income  received,  less  cash  paid for  expenses).  Cash  from  operations  was
$2,496,805 and $2,411,275 for the nine months ended September 30, 2001 and 2000,
respectively.  The  increase in cash from  operations  for the nine months ended
September  30,  2001 was  primarily  a result of  changes  in the  Partnership's
working capital.

        Other sources and uses of capital included the following during the nine
months ended September 30, 2001.

        In March 2001, Middleburg Joint Venture, in which the Partnership owns a
12.46%  interest,  sold its Property to the tenant in accordance with the option
under its lease agreement to purchase the Property,  for $1,900,000.  Due to the
fact that the joint venture had recorded  accrued  rental  income,  representing
non-cash  amounts  that the joint  venture had  recognized  as income  since the
inception of the lease relating to the  straight-lining of future scheduled rent
increases in accordance with generally accepted accounting principles, a loss of
approximately  $61,900 was recorded for  financial  reporting  purposes in March
2001.  Middleburg  Joint  Venture was  dissolved  in  accordance  with the joint
venture  agreement and no gain or loss on the  dissolution  of the joint venture
was recorded. As a result, the Partnership received  approximately $236,700 as a
return of capital for its  pro-rata  share of the net sales  proceeds.  In April
2001, the Partnership  reinvested the net sales proceeds it received as a return
of capital from Middleburg Joint Venture, in another joint venture  arrangement,
CNL VIII,  X, XII Kokomo  Joint  Venture,  with CNL Income Fund X, Ltd.  and CNL
Income Fund XII,  Ltd.,  Florida  limited  partnerships  and  affiliates  of the
general partners,  to purchase and hold one restaurant Property, at a total cost
of approximately $2,112,000. The joint venture acquired the Property from CNL BB
Corp., an affiliate of the general  partners,  who had purchased and temporarily
held  title to this  Property  in order to  facilitate  the  acquisition  of the
Property by the joint  venture.  As of September 30, 2001, the  Partnership  had
contributed approximately $211,200 and had an approximate 10 percent interest in
the profits and losses of the joint venture.

        In May 2001, the  Partnership  sold its Property in  Statesville,  North
Carolina,  and received net sales  proceeds of $877,000,  resulting in a gain of
approximately  $28,300  for  financial  reporting  purposes.  In June 2001,  the
Partnership  reinvested  a portion  of these  sales  proceeds  in an  additional
Property in Walker,  Louisiana  as  tenants-in-common  with CNL Income Fund XVI,
Ltd., a Florida limited partnership and affiliate of the general partners. As of
September 30, 2001, the Partnership had contributed approximately $232,300 for a
17 percent interest in the Property.

        In addition, in July 2001, the Partnership  reinvested the remaining net
sales proceeds it received from the sale of the property in  Statesville,  North
Carolina in a Bennigan's  property in Denver,  Colorado,  as  tenants-in-common,
with CNL Income Fund XVIII, Ltd., a Florida limited partnership and an affiliate
of  the  general  partners.  As of  September  30,  2001,  the  Partnership  had
contributed  approximately  $422,600  for a 19.30%  interest  in the profits and
losses of the Property.

        Currently,  rental income from the Partnership's  Properties is invested
in money market accounts or other short-term,  highly liquid investments such as
demand  deposit  accounts  at  commercial  banks,   money  market  accounts  and
certificates  of deposit  with less than a 90-day  maturity  date,  pending  the
Partnership's  use  of  such  funds  to  pay  Partnership  expenses  or to  make
distributions  to the  partners.  At September  30, 2001,  the  Partnership  had
$2,426,454 invested in such short-term investments, as compared to $1,226,635 at
December 31, 2000.  The increase in cash and cash  equivalents  at September 30,
2001,  as compared to December 31, 2000,  was  attributable  to the  Partnership
receiving proceeds from the sale of the Property in Statesville, North Carolina,
receiving a return of capital from Middleburg Joint Venture,  as described above
and collecting the outstanding balance of approximately $400,000 relating to two
promissory  notes.  The  increase  was also  attributable  to the fact  that the
Partnership redeemed several certificates of deposit. The increase was partially
offset by the fact that the  Partnership  used a portion  of these  proceeds  to
invest in CNL VIII,  X, XII Kokomo Joint Venture and to acquire an interest in a
Property  in  Walker,  Louisiana,  and an  interest  in a  Property  in  Denver,
Colorado,  as  tenants-in-common,  with affiliates of the general  partners,  as
described  above.  The funds  remaining at September 30, 2001,  after payment of
distributions  and  other  liabilities,  will be used to meet the  Partnership's
working capital needs.

Short-Term Liquidity

        The Partnership's short-term liquidity requirements consist primarily of
the operating expenses of the Partnership.

        The Partnership's  investment strategy of acquiring  Properties for cash
and  leasing  them under  triple-net  leases to  operators  who  generally  meet
specified financial  standards  minimizes the Partnership's  operating expenses.
The general partners believe that the leases will continue to generate cash flow
in excess of operating expenses.

        The general  partners have the right,  but not the  obligation,  to make
additional capital  contributions if they deem it appropriate in connection with
the operations of the Partnership.

        The Partnership  generally  distributes  cash from operations  remaining
after the payment of the operating  expenses of the  Partnership,  to the extent
that  the  general  partners   determine  that  such  funds  are  available  for
distribution.   Based  on  cash  from  operations,   the  Partnership   declared
distributions  to limited  partners  of  $2,362,503  for each of the nine months
ended  September  30, 2001 and 2000  ($787,501  for each of the  quarters  ended
September 30, 2001 and 2000). This represents  distributions for each applicable
nine months of $0.068 per unit ($0.023 per unit for each applicable quarter). No
distributions were made to the general partners for the quarters and nine months
ended  September  30,  2001 and 2000.  No  amounts  distributed  to the  limited
partners for the nine months ended  September  30, 2001 and 2000 are required to
be or have been treated by the  Partnership  as a return of capital for purposes
of  calculating  the  limited   partners'   return  on  their  adjusted  capital
contributions. The Partnership intends to continue to make distributions of cash
available for distribution to the limited partners on a quarterly basis.

        Total liabilities of the Partnership,  including  distributions payable,
decreased to $963,580 at September 30, 2001, from $966,342 at December 31, 2000.
The general partners believe that the Partnership has sufficient cash on hand to
meet its current working capital needs.

Long-Term Liquidity

        The  Partnership  has no  long-term  debt or other  long-term  liquidity
requirements.

Results of Operations

        During the nine months ended September 30, 2000, the Partnership and its
consolidated  joint venture,  Woodway Joint Venture,  owned and leased 29 wholly
owned  Properties  (including  four  Properties  which were sold during 2000) to
operators of  fast-food  and  family-style  restaurant  chains.  During the nine
months ended  September 30, 2001, the  Partnership  and its  consolidated  joint
venture,  Woodway  Joint  Venture,  owned and leased 26 wholly owned  Properties
(including  one  Property  sold  during  2001) to  operators  of  fast-food  and
family-style restaurant chains. In connection therewith,  during the nine months
ended  September 30, 2001 and 2000,  the  Partnership  and Woodway Joint Venture
earned $1,787,951 and $2,009,979,  respectively, in rental income from operating
leases (net of  adjustments  of accrued  rental  income) and earned  income from
direct  financing  leases,  $642,135 and $698,368 of which was earned during the
quarters ended September 30, 2001 and 2000, respectively. The decrease in rental
and earned income  during the quarter and nine months ended  September 30, 2001,
as  compared  to the  quarter and nine months  ended  September  30,  2000,  was
partially  attributable  to a decrease of  approximately  $38,700  and  $245,600
during the quarter and nine months ended  September 30, 2001,  respectively,  in
rental  and  earned  income,  due to the fact  that the  Partnership  sold  four
Properties  during 2000 and one during  2001.  The decrease in rental and earned
income  during the  quarter  and nine  months  ended  September  30,  2001,  was
partially  offset by an  increase in rental and earned  income of  approximately
$36,800 and  $204,500,  during the quarter and nine months ended  September  30,
2001,  respectively,  as a result of the  Partnership  reinvesting  a portion of
these net sales proceeds in two  Properties in Deerfield,  Illinois and Hialeah,
Florida.

        The  decrease  in rental and earned  income  during the quarter and nine
months ended  September 30, 2001,  was partially due to the fact that the tenant
of the Property in Statesville,  North Carolina defaulted under the terms of its
lease,  discontinued  the operations of the restaurant and vacated the Property.
As a result,  the  Partnership  reversed  previously  accrued  rental  income of
approximately $117,700 relating to the Property in Statesville,  North Carolina.
The accrued  rental  income was the  accumulated  amount of non-cash  accounting
adjustments  previously  recorded in order to recognize  future  scheduled  rent
increases as income evenly over the term of the lease. The Partnership sold this
Property in May 2001, as describe above in "Capital Resources."

        Rental and earned  income  decreased  during the quarter and nine months
ended September 30, 2001, by  approximately  $25,500 and $27,700,  respectively,
due to the fact that  during the quarter and nine  months  ended  September  30,
2001,  the tenant of the  Property  in North Fort  Myers,  Florida,  vacated the
Property and ceased making rental  payments on this Property.  Rental and earned
income  also  decreased  due to the fact  that the  Partnership  established  an
allowance  for  doubtful  accounts of  approximately  $5,300 and $41,700 for the
quarter and nine months ended  September 30, 2001 for past due amounts billed to
the tenant prior to the tenant  vacating the  Property.  No such  allowance  was
recorded for the quarter and nine months ended  September 30, 2000.  The general
partners will continue to pursue  collection of past due rental amounts relating
to this  Property.  In addition,  rental and earned income  decreased due to the
fact that the Partnership reversed  approximately  $93,700 in previously accrued
rental income  relating to this Property  during the nine months ended September
30,  2001.  The accrued  rental  income was the  accumulated  amount of non-cash
accounting   adjustments  previously  recorded  in  order  to  recognize  future
scheduled  rent  increases as income evenly over the term of the lease.  No such
amounts were  reversed  during the nine months  ended  September  30,  2000.  In
September 2001, the  Partnership  entered into a new lease with a new tenant for
this Property for which rental payments will commence in December 2001.

        During  the  nine  months  ended   September  30,  2001  and  2000,  the
Partnership  also earned  $236,399 and $206,839,  respectively,  in interest and
other  income.  The increase in interest and other income during the nine months
ended  September 30, 2001 was  primarily  due to the fact that during 2001,  the
Partnership  received and recorded as income  additional  amounts  relating to a
settlement  from the Florida  Department  of  Transportation  for a right of way
taking  relating to a parcel of land on its  Property in  Brooksville,  Florida,
which was sold in 2000.

        During  the  nine  months  ended   September  30,  2001  and  2000,  the
Partnership  owned and leased nine Properties  indirectly  through joint venture
arrangements  (including  one  Property  which  was sold  during  2001)  and one
Property  with  affiliates  of the  general  partners as  tenants-in-common.  In
addition, during the nine months ended September 30, 2001, the Partnership owned
and leased one additional  Property through a joint venture  arrangement and two
additional   Properties   with   affiliates   of   the   general   partners   as
tenants-in-common.  In  connection  therewith,  during  the  nine  months  ended
September  30, 2001 and 2000,  the  Partnership  earned  $285,584 and  $213,951,
respectively,  attributable to net income earned by these  unconsolidated  joint
ventures,  $107,815 and $75,397 of which was earned  during the  quarters  ended
September 30, 2001 and 2000,  respectively.  Net income earned by unconsolidated
joint ventures  increased during the quarter and nine months ended September 30,
2001,  primarily due to the fact that in August 2000, the  Partnership  acquired
one Property,  as  tenants-in-common,  and during 2001, the Partnership acquired
two  Properties,   as  tenants-in-common,   and  invested  in  a  joint  venture
arrangement.

        The  increase in net income  earned by these joint  ventures  during the
quarter and nine months  ended  September  30,  2001 was  partially  offset by a
decrease in net income earned by these joint ventures as a result of the sale of
the Property  owned by Middleburg  Joint Venture in March 2001. In addition,  in
conjunction with the sale of the Property,  Middleburg  Joint Venture,  in which
the  Partnership  owns a 12.46%  interest,  recognized  a loss of  approximately
$61,900 for financial reporting purposes as a result of the sale of its Property
in March 2001, as described above in "Capital Resources."

        Operating expenses,  including  depreciation  expense, were $593,575 and
$494,455 for the nine months ended September 30, 2001 and 2000, respectively, of
which $144,090 and $132,090 were incurred  during the quarters  ended  September
30, 2001 and 2000,  respectively.  The increase in operating expenses during the
nine months  ended  September  30,  2001,  as compared to the nine months  ended
September  30,  2000,  was  primarily  attributable  to an increase in the costs
incurred for  administrative  expenses for  servicing  the  Partnership  and its
Properties, as permitted by the Partnership agreement. In addition, the increase
in  operating  expenses  during the nine  months  ended  September  30, 2001 was
partially due to the Partnership incurring additional state taxes due to changes
in tax laws of a state in which the Partnership conducts business.

        In addition,  the Partnership incurred real estate taxes during the nine
months ended  September 30, 2001,  relating to the Property in North Fort Myers,
Florida,  due to the tenant vacating the Property.  The Partnership  will pursue
collection of these real estate taxes and will  recognize such amounts as income
if  collected.  The  Partnership  entered into a new lease with a new tenant for
this Property. In accordance with the terms of the lease, the new tenant will be
responsible  for  such  expenses  commencing  December  2001;   therefore,   the
Partnership does not expect to continue incurring these expenses.

        The  increase  in  operating  expenses,  during  the nine  months  ended
September 30, 2001, was partially offset by the fact that during the nine months
ended September 30, 2000 the Partnership  incurred $67,801 in transaction  costs
related to the general partners retaining financial and legal advisors to assist
them in  evaluating  and  negotiating  the  proposed  merger  with CNL  American
Properties  Fund, Inc.  ("APF").  On March 1, 2000, the general partners and APF
mutually  agreed to terminate the merger.  No such expenses were incurred during
the nine months ended September 30, 2001.

        During the nine months ended  September 30, 2001, the  Partnership  sold
its Property in  Statesville,  North Carolina and received net sales proceeds of
approximately  $877,000,  resulting  in a  gain  of  approximately  $28,300  for
financial reporting purposes.

        As a result of the sale of several Properties,  the Partnership recorded
total gains of approximately  $612,700 for financial  reporting  purposes during
the quarter and nine months ended September 30, 2000.

        During  the nine  months  ended  September  30,  2001,  the  Partnership
recorded a provision  for loss on assets in the amount of $88,144 for  financial
reporting purposes relating to the Property in North Fort Myers, Florida, due to
the fact that the tenant  ceased  operations  and  vacated  this  Property.  The
provision  represented the difference between the carrying value of the Property
and the general  partners'  estimated  net  realizable  value of the Property at
September 30, 2001.


ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

        No  material  changes in the  Partnership's  market risk  occurred  from
December  31,  2000,  through  September  30, 2001.  Information  regarding  the
Partnership's  market risk at December 31, 2000 is included in its Annual Report
on Form 10-K for the year ended December 31, 2000.


<PAGE>


                           PART II. OTHER INFORMATION



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

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

Item 3.  Defaults upon Senior Securities.  Inapplicable.
         -------------------------------

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

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

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

         (a)  Exhibits

              3.1     Affidavit and  Certificate  of Limited  Partnership of CNL
                      Income  Fund  VIII,  Ltd.  (Included  as  Exhibit  3.2  to
                      Registration  Statement  No.  33-31482  on Form  S-11  and
                      incorporated herein by reference.)

              4.1     Affidavit and  Certificate  of Limited  Partnership of CNL
                      Income  Fund  VIII,  Ltd.  (Included  as  Exhibit  3.2  to
                      Registration  Statement  No.  33-31482  on Form  S-11  and
                      incorporated herein by reference.)

              4.2     Amended and Restated  Agreement of Limited  Partnership of
                      CNL Income  Fund VIII,  Ltd.  (Included  as Exhibit 4.2 to
                      Form  10-K  filed  with  the   Securities   and   Exchange
                      Commission on April 1, 1996,  and  incorporated  herein by
                      reference.)

              10.1    Management  Agreement  between CNL Income Fund VIII,  Ltd.
                      and CNL  Investment  Company  (Included as Exhibit 10.1 to
                      Form  10-K  filed  with  the   Securities   and   Exchange
                      Commission on April 1, 1996,  and  incorporated  herein by
                      reference.)

              10.2    Assignment of  Management  Agreement  from CNL  Investment
                      Company to CNL Income Fund  Advisors,  Inc.  (Included  as
                      Exhibit  10.2 to Form 10-K filed with the  Securities  and
                      Exchange  Commission on March 30, 1995,  and  incorporated
                      herein by reference.)

              10.3    Assignment  of Management  Agreement  from CNL Income Fund
                      Advisors,  Inc. to CNL Fund  Advisors,  Inc.  (Included as
                      Exhibit  10.3 to Form 10-K filed with the  Securities  and
                      Exchange  Commission  on April 1, 1996,  and  incorporated
                      herein by reference.)

              10.4    Assignment of Management Agreement from CNL Fund Advisors,
                      Inc. to CNL APF Partners, LP. (Included as Exhibit 10.4 to
                      Form  10-Q  filed  with  the   Securities   and   Exchange
                      Commission on August 9, 2001, and  incorporated  herein by
                      reference.)

              (b)     Reports on Form 8-K

                      No reports on Form 8-K were filed during the quarter ended
                      September 30, 2001.



<PAGE>




                                   SIGNATURES



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

         DATED this 7th day of November, 2001.


                                        CNL INCOME FUND VIII, LTD.

                                        By: CNL REALTY CORPORATION
                                            General Partner


                                            By: /s/ James M. Seneff, Jr.
                                                ------------------------------
                                                JAMES M. SENEFF, JR.
                                                Chief Executive Officer
                                                (Principal Executive Officer)


                                            By: /s/ Robert A. Bourne
                                                ------------------------------
                                                ROBERT A. BOURNE
                                                President and Treasurer
                                                (Principal Financial and
                                                Accounting Officer)