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================================================================
                        UNITED STATES
                                
               SECURITIES AND EXCHANGE COMMISSION
                                
                     Washington, D.C.  20549
                     -----------------------           
                            FORM 10-Q
(Mark One)

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

     For the quarterly period ended March 31, 1997
                                    --------------
                               OR
/ /  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
     SECURITIES EXCHANGE ACT OF 1934

     For the transition period from __________ to __________

             --------------------------------
             Commission file number:  0-25600
             --------------------------------

          OXFORD TAX EXEMPT FUND II LIMITED PARTNERSHIP
     ------------------------------------------------------
     (Exact name of registrant as specified in its charter)
                                
          Maryland                         52-1394232
-------------------------------        -------------------
(State or other jurisdiction of        (I.R.S. Employer
incorporation or organization)         Identification No.)

   7200 Wisconsin Avenue, 11th floor, Bethesda, Maryland 20814
   -----------------------------------------------------------
     (Address of principal executive offices)     (Zip Code)

Registrant's telephone number, including area code (301) 654-3100

Securities registered pursuant to Section 12(b) of the Act:  NONE
Securities registered pursuant to Section 12(g) of the Act:
Beneficial Assignee Interests

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

The Beneficial Assignee Interests of limited partnership interest
of  the Partnership (the "OTEF II BACs") are not currently  being
traded  in any public market.  Therefore, the BACs had neither  a
market selling price nor an average bid or asked price within the
60 days prior to the date of this filing.

Index to Exhibits is found on page 3.                             
=================================================================
<PAGE> 2

          OXFORD TAX EXEMPT FUND II LIMITED PARTNERSHIP
                                
                            FORM 10-Q
                                
                   PART I-FINANCIAL INFORMATION

Item 1.  Financial Statements.
           
    The  financial statements of the Partnership are incorporated
herein   by   reference   to   sequentially   numbered  pages  15
through 18 of OTEF II's Quarterly Report (Unaudited).
         
Item 2.  Management's   Discussion  and   Analysis  of  Financial
         Condition and Results of Operations.
           
    A  discussion of OTEF II's financial condition and results of
operations  for the three-month period ended March  31,  1997  is
incorporated  herein by reference to sequentially numbered  pages     
6  through  14  entitled  "Report  of   Management"  included  in
OTEF II's Quarterly Report (Unaudited).

                   PART II-OTHER INFORMATION

Item 1.  Legal Proceedings.

    Information responsive to this Item regarding putative  class
and derivative lawsuits is contained  in   Note  8  to  Financial
Statements  of the Form 10-K for the year ended December 31, 1996
filed by OTEF II.

Item 2.  Changes in Securities.
    None.

Item 3.  Defaults Upon Senior Securities.
    None.

Item 4.  Submission of Matters to a Vote of Security Holders.
    None.
     
Item 5.  Other Information.
    None.
    
Item 6.  Exhibits and Reports on Form 8-K.
    (a)  Exhibits.
   
    For  a  list  of  Exhibits  as  required  by  Item  601   of    
    Regulation  S-K,  see  Exhibit  Index  on  page  3  of  this
    report.

    (b)  Reports on Form 8-K.
    None.

    No other items were applicable.





<PAGE> 3
                                
          OXFORD TAX EXEMPT FUND II LIMITED PARTNERSHIP
                                
                            FORM 10-Q
                                
                          EXHIBIT INDEX

(Listed according to the number assigned in the Exhibit Table in
Item 601 of Regulation S-K).

(20) Report furnished to Security Holders.

     Oxford Tax Exempt Fund II Limited Partnership's Quarterly
     Report  (Unaudited)  dated  March  31, 1997,  follows  on
     sequentially numbered pages 5 through 27 of this report.     

(27) Financial Data Schedule.










































<PAGE> 4
                                
          OXFORD TAX EXEMPT FUND II LIMITED PARTNERSHIP
                                
                            FORM 10-Q
                                
                           SIGNATURES

    Pursuant  to the  requirements  of Section 13 or 15(d)  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.
                                                                 
                    Oxford Tax Exempt Fund II Limited Partnership

                    By:  Oxford Tax Exempt Fund II Corporation
                         Managing General Partner of the registrant

Date: 5/20/97       By:  /S/ Richard R. Singleton
      -------            ------------------------------------------
                         Richard R. Singleton
                         Senior Vice President and  
                            Chief Financial Officer
                                   
                           
   Pursuant  to  the requirements of the Securities Exchange Act of
1934,  this report has been signed below by the  following  persons
on  behalf  of  the registrant  and in the capacities  and  on  the
dates indicated.              
                            
                        
                        
Date: 5/20/97       By:  /S/ Leo E. Zickler
      -------            ------------------------------------------
                         Leo E. Zickler
                         Chairman of the Board of Directors and 
                            Chief Executive Officer
                            
                          
Date: 5/20/97       By:  /S/ Francis P. Lavin 
      -------            ------------------------------------------
                         Francis P. Lavin
                         Director and President
                                
                               
Date: 5/20/97       By:  /S/ Robert B. Downing
      -------            ------------------------------------------
                         Robert B. Downing
                         Director and Executive Vice President











<PAGE> 5










          OXFORD TAX EXEMPT FUND II LIMITED PARTNERSHIP

                        Quarterly Report
                           (Unaudited)

                         March 31, 1997

























     CONTENTS

     Report of Management
     Balance Sheets
     Statements of Income
     Statement of Partners' Capital
     Statements of Cash Flows
     Notes to Financial Statements
     Instructions for Investors who wish to reregister or
       transfer OTEF II BACs








<PAGE> 6
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Report of Management
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    The following report provides information about the financial
condition  of  Oxford Tax Exempt Fund II Limited  Partnership,  a
Maryland  limited  partnership  ("Oxford  Tax  Exempt  Fund  II,"
"OTEF  II," or the "Partnership"), as of March 31, 1997, and  its
results  of operations and cash flows for the period then  ended.
This  report  and  analysis  should be  read  together  with  the
financial  statements and related notes thereto and the  selected
financial data appearing elsewhere in this Quarterly Report.

Recent Developments

    As  previously  discussed,  an Information  Memorandum  dated
December  2,  1996,  was furnished to the holders  of  beneficial
assignee interests (the "OTEF II BAC Holders") in connection with
and  as  part  of  the settlement of certain putative  class  and
derivative   action  litigation  ("OTEF  II  Litigation").    The
Information Memorandum described the new business plan  for  OTEF
II  ("Liquidity and Growth Plan"), and provided BAC Holders  with
the  information necessary to make an informed decision regarding
whether  they  wished to exchange their BACs for a new  class  of
BACs  ("Status Quo BACs" or "SQBs").  The SQBs and the  Liquidity
and  Growth  Plan  are discussed below. 

    Status  Quo  BACs.  Approximately 4.3% of  the  OTEF  II  BAC
Holders  made a timely election to convert their OTEF II BACs  to
SQBs.   Effective  April  1, 1997, OTEF II  issued  the  SQBs  in
uncertificated,  book-entry form.  The SQBs  represent  interests
only in the existing mortgage revenue bonds ("Existing MRBs"), as
refunded,  and  not in the new assets that will  be  acquired  by
OTEF  II  pursuant to the terms of the Liquidity and Growth Plan.
The SQBs are designed to replicate, to the  extent  possible, the
economic interest that the holders of the SQBs (the  "Status  Quo
BAC Holders") would have had in the Existing MRBs,  as  refunded, 
if the partnership  agreement  for Oxford Tax Exempt Fund Limited 
Partnership ("OTEF"), OTEF II's  predecessor,  had  continued  to
govern  and  the  Liquidity  and Growth Plan was not implemented.
OTEF II is finalizing  the  accounting  methodology  that will be
used with respect to  the SQBs. More detailed information will be
included in the Quarterly Report for the second quarter.

    The  Status Quo BAC Holders will not share in the growth  and
the  other  benefits expected to be achieved under the  Liquidity
and  Growth  Plan.  The SQBs will not be listed on any securities
exchange,  and it is not expected that there will  be  an  active
trading market for them.  In addition, the Status Quo BAC Holders
will  not be allocated any capital losses for federal income  tax
purposes  that  may result from the disposition of  the  Existing
MRBs or interests therein or new assets.

    Under  the  Optional Sale Plan described in  the  Information
Memorandum,  the original Status Quo BAC Holders have the  option
to  tender  all  or  a  portion  of  their  SQBs  for purchase or
redemption by OTEF II.  As of May 16, 1997, 162  Status  Quo  BAC
Holders with 3,115 SQBs exercised  this  option, however, as  the

<PAGE> 7
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Report of Mangement
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election deadline of June 20, 1997, for Status  Quo  BAC  Holders
to exercise this right has  not  occurred,  the  Managing General
Partner is unable to determine at this  time  the total amount of
OTEF  II's   funding  obligation.  All  properly  tendered   SQBs 
must be purchased or redeemed by OTEF II by March 17, 1998.

    Liquidity  and  Growth Plan.  Under the Liquidity  and Growth
Plan, OTEF II will apply to list the OTEF  II BACs for trading on
a national securities exchange, and the proceeds from the sale of
the bonds issued  to  refund  the  Existing  MRBs,  or  interests
therein, or any debt issued by OTEF II and secured by such assets
(together, the "Financing") and  any  additional  funds that OTEF
II may obtain, will be  invested  in  new  assets.  The  Managing
General Partner believes the Liquidity and Growth Plan will allow
OTEF II to take advantage of attractive  investment opportunities 
and thereby increase cash distributions and value to the  holders
of the OTEF II BACs ("Liquidity BAC Holders").

    Listing  of OTEF II BACs-Liquidity  and Trading Market.   The
Managing  General  Partner  is continuing  discussions  with  two
national  securities exchanges and expects OTEF  II  to  formally
apply  for  listing  on  one of them  in  the  near  future.   In
addition, prior to listing or shortly after listing, OTEF II will
divide  or  "split"  the outstanding OTEF II  BACs  into  smaller
denominations  to  enhance  trading in,  and  liquidity  of,  the
OTEF  II BACs and encourage a broader range of investors.  It  is
expected  that  the  division will  result  in  the  issuance  of
approximately  25  new  OTEF  II  BACs  ("New  BACs")  for   each
outstanding OTEF II BAC.

    Issuance of New BACs.  All OTEF II BACs currently are held in
uncertificated,   book-entry   form   on   OTEF    II's    books.
Nevertheless, the OTEF II position  of many OTEF II  BAC  Holders
are   reported   on  their  brokerage  account  statements,   and
distributions  made  by OTEF II are credited  directly  to  their
brokerage accounts.

   In connection with the listing of the OTEF II BACs for trading
and the issuance of the New BACs, OTEF II will issue certificates
representing  ownership  of the New  BACs.   Unless  OTEF  II  is
instructed  otherwise (as described below),  those  OTEF  II  BAC
Holders  whose  OTEF  II  BACs are currently  reported  on  their
brokerage  account statements will not receive  certificates  for
their  New BACs.  Instead, the New BACs for such holders will  be
issued  in a form that will: (i) enable the New BACs to  continue
to  be  reported  on their account statements;  (ii)  enable  all
distributions payable with respect to such New BACs  to  continue
to  be  credited directly to their brokerage accounts; and  (iii)
enable  such  OTEF II BAC Holders to hold or sell  the  New  BACs
through their brokerage firm accounts.  Such form of issuance  is
referred to as "street name" issuance, and is the same form  that
generally  applies  to  traded securities  held  in  a  brokerage
account.


<PAGE> 8
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Report of Management
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    Business  Plan  for Growth.  Under the Liquidity  and  Growth
Plan,  OTEF II will invest the proceeds of the Financing and  any
additional funds that OTEF II may obtain in new assets  described
below  to increase the distributions payable with respect to  the
New BACs and the value to the Liquidity BAC Holders.

    Refunding and Financing.  As of March 31, 1997, OTEF  II  had
refunded  12  of the Existing MRBs, which comprise  approximately
87.5% of OTEF  II's  portfolio,  including  two  refundings  that
closed  during  the  first  quarter   of  1997  (Colonel  I   and
Middletown).  It  is  expected  that  the  refunding  of  the two
remaining Existing  MRBs  will  close  during 1997.  Refunding an  
Existing  MRB  means  exchanging  that  bond  for  newly   issued
refunding bonds ("Refunding Bonds")  with  approximately the same 
principal amount, an extended maturity  and restructured interest 
rates that increase each year during  the  terms of the Refunding 
Bonds and that are designed to require  the limited  partnerships  
which own the  properties  securing  the  bonds  (the  "Operating
Partnerships") to pay substantially  all  of their projected cash
flow as interest on  the  Refunding  Bonds.  As a result of these 
refundings, the estimated value  of the  bonds  held  by  OTEF II 
as   shown  on the  Balance   Sheet  increased  by  approximately  
$2,387,000 as of March 31, 1997, compared to December 31, 1996.

    The Refunding Bonds are structured so as to consist of senior
bonds  ("Series  A  Bonds")  and subordinated  bonds  ("Series  B
Bonds").  This senior/subordinated structure will permit OTEF  II
to undertake the Financing, pursuant to which it will sell all or
a  portion of the Series A Bonds, or interests therein, that  are
designated as Liquidity Assets, or issue debt that may be secured
by  such  assets,  new assets or both.  OTEF II will  retain  the
related  Series  B  Bonds for the benefit of  the  Liquidity  BAC
Holders, and will retain both the senior Series A Bonds  and  the
subordinated  Series  B  Bonds, or interests  therein,  that  are
designated as Status Quo Assets for the benefit of the Status Quo
BAC Holders.

    In  addition to the proceeds from the Financing, OTEF II  may
acquire  new  assets: (i) from the proceeds  of  sales  or  other
dispositions  of  the  Refunding  Bonds  and  the  proceeds  from
principal  payments with respect to the Refunding  Bonds  (except
for  the  portion of such proceeds allocable to the  SQBs);  (ii)
from  the  proceeds of sales or other dispositions of new  assets
and  the  proceeds from principal payments with  respect  to  new
assets; (iii) from the proceeds of issuances of additional equity
securities, including additional limited partnership interests in
OTEF  II  and additional OTEF II BACs; (iv) by issuing additional
equity securities in exchange for new assets; or (v) by borrowing
funds  from  lenders  or  by issuing evidences  of  indebtedness.
Although  the  Managing  General  Partner  is  authorized   under
OTEF  II's  partnership agreement to reinvest cash  flow  in  new
assets,  it  has  no  current plans to do so in  the  foreseeable
future.


<PAGE> 9
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Report of Management
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   Investment in New Assets. The Managing General Partner intends
to  invest  primarily in additional mortgage  revenue  bonds  and
securities  of  other  entities which primarily  hold  tax-exempt
mortgage  revenue bonds.  OTEF II also may invest in  multifamily
real  estate, senior living facilities or residential health care
facilities, or other direct or indirect debt or equity  interests
in  such  real  estate, some of which may give  rise  to  taxable
income,  but  the  Managing General Partner  does  not  currently
expect that these types of investments will be a significant part
of its business in the foreseeable future.  (All of the foregoing
are referred to collectively as "New Assets".)

    OTEF  II  generally will acquire additional mortgage  revenue
bonds  and  taxable  bonds  that are not  rated  by  any  of  the
nationally  recognized rating agencies (such as Moody's  Investor
Services, Inc. or Standard & Poor's Ratings Group) and  that  are
not credit-enhanced at the time of acquisition, although OTEF  II
may  seek  to have all or a portion of such bonds credit-enhanced
or  rated at a future date.  It also is expected that OTEF II may
invest in bonds, including bonds that may be secured by bonds  or
mortgages that are subordinated to senior bonds or mortgages held
by third parties, on terms that will permit it, in many cases, to
participate (either through stepped interest rates or  otherwise)
in  the  future  growth and increase in value of  the  properties
financed  by such bonds.  In addition, in the case of bonds  that
require restructuring, it is anticipated that OTEF II may be able
to  acquire such bonds on a discounted basis, that is, where  the
nominal  principal amount of the bond exceeds the purchase  price
and/or  the estimated current liquidation value of the underlying
property.

Liquidity and Capital Resources
    
    Current  Position.   OTEF II uses the  interest  payments  it
receives from the Refunding Bonds and Existing MRBs primarily for
distributions  to its General Partners, OTEF II BAC  Holders  and
SQB  Holders,  and  to  pay administrative   expenses  and   fund
reserves,  as   well   as   the   costs   associated   with   the
implementation  of  the  1995  OTEF Restructuring Plan, including
OTEF II's costs associated  with  the  defense  of  the  OTEF  II 
Litigation and the payment by OTEF II of $2.5 million of fees and
expenses incurred by plaintiffs' counsel.   As  of  May 16, 1997,
OTEF II has estimated  that  approximately  $1.7  million will be 
required to meet its obligations under  the Optional  Sale  Plan.
Although  OTEF  II is unable to determine the total amount of its
funding obligations at  this  time,  it believes that its funding
obligations will  increase  above  this amount.  Except as may be
required in connection with  the  1995  OTEF  Restructuring Plan,
OTEF  II  has   no   commitments  for  capital  expenditures.   A
distribution for the quarter ended March  31, 1997, in the amount
of $3,642,796, or $11.90 per BAC (4.76% per annum on the original
$1,000  invested  per  BAC) was  made  on  May  15,  1997.   This
distribution is consistent with the distributions  made  for  the
previous eight quarters.

<PAGE> 10
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Report of Management
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    As  of  March 31, 1997, OTEF II held $11,977,000 in cash  and
cash  equivalents, a  decrease of $95,000, or less than 1%,  from
$12,072,000 in cash and cash equivalents held as of December  31,
1996.  The slight decrease in OTEF II's cash and cash equivalents
is due primarily to payments received from its investments in the
Existing MRBs and the Refunding Bonds, offset by  administrative, 
governance   and   litigation   costs    associated   with    the 
implementation of the 1995 OTEF  Restructuring  Plan  which  were 
paid during the quarter ended March  31,  1997, as  well  as  the
payment by OTEF II of the fourth quarter 1996 distribution.   The
total  liabilities  of  OTEF   II  shown  on  the  Balance  Sheet
decreased to $6,465,000  as of  March 31, 1997,  from  $6,964,000 
at  December  31, 1996,  and does not include an amount  for  its 
obligation under the Optional Sale Plan discussed above. 

    Governance  and administrative expenses totaled $332,000  for
the  three-month  period ended March 31,  1997,  as  compared  to
$614,000  for the three-month period ended March 31,  1996.   The
decrease of $282,000 was primarily attributable to a decrease  in
governance expenses relating to the 1995 OTEF Restructuring  Plan
offset  by  an increase in expense reimbursements to the  General
Partners  and their affiliates.  Litigation and settlement  costs
due to the OTEF II Litigation totaled $98,000 for the three-month
period ended March 31, 1997.

    Existing  MRBs.  As of March 31, 1997, OTEF II held  Existing
MRBs  for two of the Operating Partnerships.  It is expected that
the  refunding  of  the two remaining Existing  MRBs  will  close
during 1997.

    The term of each Existing MRB, and accordingly, each Mortgage
Loan is 24 years.  The principal will not be amortized during the
term of the Existing MRB, and will be required to be repaid in  a
lump-sum balloon payment at the expiration of the bond term or at
such earlier time as OTEF II may require.  Beginning on the first
day  of the thirteenth year and continuing through the end of the
fourteenth year, OTEF II may require payment of all principal and
deferred  interest  due, upon 12 months' prior  notice.   In  the
fifteenth  year (if an Existing MRB has not been repaid earlier),
OTEF  II will demand payment of principal and deferred contingent
interest due.  Each Mortgage Loan is nonassumable and due on sale
of the Existing Mortgaged Property.

    The  Existing MRBs and the underlying Mortgage Loans continue
to  provide  for  the payment of interest at an aggregate  annual
rate  of  up  to 16%, consisting of Base Interest and  additional
Contingent Interest.  Base Interest is owed at the rate of  8.25%
per  annum, but is payable only to the extent funds are available
from  cash  flow  and  sale or refinance proceeds.   Unpaid  Base
Interest  is deferred, with additional interest charged  on  such
deferred  amounts  at  the rate of 8.25%  per  annum,  compounded
monthly and payable from future cash flow and sale or refinancing
proceeds.


<PAGE> 11
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Report of Management
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    Cumulative Unpaid Base Interest and interest on interest.  As
of  March 31, 1997, the two remaining Operating Partnerships with
Existing MRBs had cumulative unpaid Base Interest and interest on
interest at 8.25% per annum, compounded monthly, of approximately
$27,946,000.   Under  the applicable method of  accounting,  this
unpaid   Base  Interest  was  not  reflected  in  the   financial
statements  of OTEF II.  All cumulative unpaid Base Interest  and
interest  on interest on the remaining Existing MRBs is  written-
off  at such time as the Existing MRBs are refunded.  During  the
quarter  ended  March 31, 1997, the Existing MRBs for  Middletown
and  Colonel I were refunded, and $24,066,000 of accrued interest
was written-off during the quarter ended March 31, 1997.

   As previously reported, under the 1988 OTEF Restructuring Plan
and the Debt Modification Agreements, dated as of April 12, 1995,
as amended, OTEF, OTEF II, the Operating Partnerships, and Oxford
entered  into certain forbearance arrangements which modify  many
of  the terms of the Existing MRBs described above.  At such time
as  the  Existing  MRBs  are refunded,  the  obligations  of  the
Operating   Partnerships  will  be  modified   substantially   as
discussed below.

Refunding Bonds

    Series  A  Bonds.   The  term of  each  Refunding  Bond  and,
accordingly, each Mortgage Loan is 30 years following the date of
refunding.   The  Series A Bonds require interest  only  payments
during  the  first three years and, thereafter,  are  subject  to
annual  sinking  fund  redemptions  that  will  result  in   full
amortization  of the Series A Bonds during the 27-year  remaining
term.

    Series  A  Bond Interest and Principal.  The Series  A  Bonds
require pre-determined annual sinking fund redemptions based on a
27-year  amortization  schedule beginning  in  the  fourth  year,
calculated  with an assumed rate of interest of  5.6%  per  year.
Series  A Bond interest  is  set  initially  at  closing  of  the
refundings  and  reset annually at a market  rate  based  upon  a
percentage  of  the then prevailing one-year U.S.  Treasury  Bill
rate,  with  a  maximum  rate of 5.6%  per  annum.   The  initial
interest rate on the Series A Bonds that have been issued to date
is 4.9%.  Upon a remarketing, the Series A Bonds may be converted
to  a  different interest rate mode (fixed or floating)  and  the
interest  rates  may  be modified at that  time  to  reflect  the
prevailing  market  interest rates for  whatever  rate  mode  and
remaining term is then applicable. All required interest payments
were made on the Refunding Bonds, including accrued interest  for
March 1997 that was paid in April 1997.

    Series  B  Bonds.   The  term of  each  Series  B  Bond  and,
accordingly, each Mortgage Loan is 30 years following the date of
refunding.



<PAGE> 12
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Report of Management
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    Series  B  Bond Interest and Principal.  The Series  B  Bonds
accrue  interest  equal to the product of the Combined  Rate  (as
defined below) multiplied by the total combined principal balance
of  the  Series A Bonds and the Series B Bonds for each Operating
Partnership,  less the interest payable on the related  Series  A
Bonds;  the resulting amount of interest divided by the principal
balance of the Series B Bonds equals the interest accrual rate on
the  Series  B Bonds.  Interest-only is payable on the  Series  B
Bonds  to  the  extent of available cash flow  of  the  Operating
Partnership, with the entire principal balance due at maturity.

    Combined Rate.  The Combined Rate represents that portion  of
each Property's projected Cash Flow Before Debt Service ("CFBDS")
for  each  year (projected at the time of the refunding  of  each
Existing  MRB)  that may be applied to interest on  the  combined
Series A Bonds and Series B Bonds.

    Other  Sources.   In  connection with  the  closing  of  each
Refunding  Bond, the applicable Operating Partnership will  enter
into certain agreements which provide as follows: (i) for so long
as   the  Series  A  Bonds  remain  outstanding,  each  Operating
Partnership will apply its net operating income before payment of
interest and principal on its Series B Bonds to make loans to the
Operating Partnerships for the payment of interest and principal,
and related fees and expenses, reserves and deposits owed by such
Operating Partnerships on their respective Series A Bonds to  the
extent  the other Operating Partnerships are unable to make  such
payments on their respective Series A Bonds, and (ii) for so long
as OTEF II owns the majority of the Series B Bonds relating to an
Operating Partnership's property and the Managing General Partner
of  OTEF  II  is  an  affiliate of the current  Managing  General
Partner,  the  Operating Partnerships will each deposit  into  an
escrow account any excess cash flow on a monthly basis after  the
obligations described in subparagraph (i) above have been met and
the payments required under that Operating Partnership's Series B
Bonds  have been made, which funds shall be applied at OTEF  II's
discretion to, among other things, make loans to other  Operating
Partnerships to enable them to make all debt service payments due
on  their  Series B Bonds.  As of March 31, 1997,  the  aggregate
amount of excess cash flow held in the escrows was  approximately
$172,000,  and approximately  $162,000  of net excess  cash  flow
generated from March 1997 operations will  be  deposited into the
applicable escrows in April 1997.

    Oxford  Advances.  As discussed in prior reports,  Oxford  is
continuing  to  hold proceeds from the $2 million Treasury  Strip
Bond  that  it received on August 15, 1996.  At March  31,  1997,
Oxford  was holding approximately $1.2 million of such  proceeds,
plus  approximately $168,000 in accrued interest, in an interest-
bearing  account  pending a determination as to  which  Operating
Partnerships  these funds should be allocated.   This  allocation
will  be  based  on  the individual refunding costs  and  reserve
requirements of the Operating Partnerships. The decrease totaling
$800,000   represents   an  allocation  of  funds  based  on  the
individual  refunding  costs  of  certain Operating Partnerships'
bonds during the first quarter of 1997.
<PAGE> 13
-----------------------------------------------------------------
Report of Management
-----------------------------------------------------------------
Results of Operations

    The Partnership's Operations

    The  Partnerships' Three-Month Operations.  Distributions  to
Partners  amounted to $3,642,796, or $11.90 per  BAC  (4.76%  per
annum on the original $1,000 invested per BAC) to BAC Holders  of
Record  as  of  March 31, 1997.  This distribution is  consistent
with the distribution made for the previous eight quarters.   For
financial statement purposes, Net Income and Net Income  per  BAC
were  $4,266,000  and $13.94, respectively, for  the  three-month
period  ended  March  31,  1997, as compared  to  $4,073,000  and
$13.31, respectively, for the three-month period ended March  31,
1996.

    As  we  announced in the Information Memorandum, the Managing
General  Partner  currently anticipates that the  amount  of  the
quarterly  distribution payable to the Liquidity BAC Holders  and
the Status Quo BAC Holders will be increased by approximately  4%
later  in  1997  following implementation of  the  Liquidity  and
Growth  Plan.  Of course, future distributions (and any increases
in  the  distributions per BAC) are always subject to the ability
of  the  Operating  Partnerships to  make  their  scheduled  debt
service  payments,  which, in turn, depends  on  the  results  of
future operations  of  their  properties  and  on  the  aggregate 
amount in the excess cash flow escrows.

    The Operating Partnerships' Operations

    The   operating  performance  of  each   of   the   Operating
Partnerships depends primarily on occupancy and rental rates, the
amount  of rent actually collected and expenditures for  property
improvements   and   operating  expenses  for  their   respective
Properties.  The occupancy and rental rates, in turn, depend on a
number  of factors, including the location of a Property  in  its
particular  community, local economic conditions and  changes  in
neighborhood  characteristics, demand for  similar  housing,  and
competition  from  existing and future housing complexes  in  the
vicinity of each Property.

   The Operating Partnerships reported an aggregate net operating
income  before property improvements of approximately  $5,576,000
for the three-month period ended March 31, 1997, representing  an
increase  of approximately $352,000, or 6.7%, over the  aggregate
net  operating income before property improvements  reported  for
the same period in 1996.  In addition, for the three-month period
ended  March  31, 1997, overall property improvement expenditures
were   approximately  $467,000,  representing  an   increase   of
approximately $59,000, or 14.3%, as compared to the  same  period
in 1996.

   Senior Living Properties.  The Operating Partnerships that own
the  four  Senior  Living Communities reported an  aggregate  net
operating  income  before property improvements of  approximately
$1,579,000  for  the  three-month period ended  March  31,  1997,
representing  an  increase of approximately $159,000,  or  11.2%,
<PAGE> 14
-----------------------------------------------------------------
Report of Management
-----------------------------------------------------------------

over   the   aggregate  net  operating  income  before   property
improvements reported for the same period in 1996.  The  weighted
average  occupancy rate for these four properties  at  March  31,
1997 was 92%, as compared to 89% at March 31, 1996.  The weighted
average monthly rent collected for March 1997 for the four Senior
Living  Communities increased by approximately 3% to  $1,772,  as
compared to $1,723 for the same period in 1996.  In addition, for
the  three-month  period ended March 31, 1997,  overall  property
improvement  expenditures for the four Senior Living  Communities
were   approximately  $161,000,  representing  an   increase   of
approximately $48,000, or 42.6%, as compared to the  same  period
in 1996.

   Apartment Properties.  The Operating Partnerships that own the
10  garden apartments reported an aggregate net operating  income
before property improvements of approximately $3,997,000 for  the
three-month period ended March 31, 1997, representing an increase
of  approximately  $194,000,  or 5.1%,  over  the  aggregate  net
operating  income before property improvements reported  for  the
same period in 1996.  The weighted average occupancy rate for the
10   garden  apartment  communities  was  approximately  93%   at
March  31,  1997,  as  compared to 94% at March  31,  1996.   The
weighted average monthly rent collected for March 1997 for the 10
garden  apartments  increased by approximately  4%  to  $751,  as
compared  to $720 for the same period in 1996.  In addition,  for
the  three-month  period ended March 31, 1997,  overall  property
improvement  expenditures  for  the  10  garden  apartments  were
approximately  $306,000 representing a decrease of  approximately
$10,000, or 3.5%, as compared to the same period in 1996.

Summary

    With  the restructuring program nearly completed, OTEF II  is
poised  to take advantage of attractive investment opportunities.
The refunding of the Existing MRBs held by OTEF II is expected to
give  OTEF  II access to the capital markets.  The Liquidity  BAC
Holders should benefit from the increase in value of the OTEF  II
BACs  that  is expected to occur as OTEF II acquires new  assets.
In  addition, the Liquidity BAC Holders should benefit from  more
efficient market pricing of the OTEF II BACs that is expected  to
occur  as  a  result of listing the OTEF II BACs  on  a  national
securities exchange.













<PAGE> 15

Oxford Tax Exempt Fund II Limited Partnership
<TABLE>
-------------------------------------------------------------------
Balance Sheets (in thousands)
-------------------------------------------------------------------
<CAPTION>
                                   March 31, 1997   
                                     (Unaudited)  December 31, 1996  
-------------------------------------------------------------------            
<S>                                    <C>             <C>       
Assets                                                                 
  Investments in Bonds                 $217,916        $215,529
  Cash and cash equivalents              11,977          12,072
  Bond interest receivable                1,323           1,099
  Other, primarily interest                                        
    receivable                               28              33
-------------------------------------------------------------------
      Total Assets                     $231,244        $228,733
===================================================================
Liabilities and Partners' Capital                                   
  Liabilities                                                      
    Accounts payable and accrued                                   
      expenses                         $  2,822        $  3,321
    Distributions payable                 3,643           3,643
------------------------------------------------------------------- 
      Total Liabilities                   6,465           6,964
-------------------------------------------------------------------
  Partners' Capital                                                          
    General Partners                     (2,381)         (2,393)
    Limited Partners' Interests                                    
      (Beneficial Assignee                                              
      Interests-299,995 interests                               
      issued and outstanding)           162,276         161,665
    Unrealized Gain on Investments       64,884          62,497
------------------------------------------------------------------- 
      Total Partners' Capital           224,779         221,769
------------------------------------------------------------------- 
      Total Liabilities and                                       
        Partners' Capital              $231,244        $228,733
===================================================================
                                                                
            The accompanying notes are an integral part 
                  of these financial statements.
 
</TABLE>













<PAGE> 16

Oxford Tax Exempt Fund II Limited Partnership
<TABLE>
-------------------------------------------------------------------
Statements of Income (in thousands, except per BAC amounts)
(Unaudited)
-------------------------------------------------------------------
<CAPTION>                                      
                                              For the three months
                                                 ended March 31,   
                                              --------------------
                                                 1997       1996
-------------------------------------------------------------------
<S>                                            <C>        <C>
Revenues                                                              
  Interest on Bonds                            $4,605     $4,602
  Other, primarily interest on short-term                             
    investments                                    91         85
-------------------------------------------------------------------
                                                4,696      4,687
                                                                   
Expenses                                                           
  Governance and administrative expenses          332        614
  Litigation and settlement costs                  98          0
------------------------------------------------------------------- 
                                                                   
Net income                                     $4,266     $4,073
===================================================================

Net income allocated to General Partners       $   85     $   81
===================================================================

Net income allocated to BAC Holders            $4,181     $3,992
=================================================================== 

Net income per BAC                             $13.94     $13.31
===================================================================

Distribution per BAC                           $11.90     $11.90
===================================================================

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

</TABLE>














<PAGE> 17

Oxford Tax Exempt Fund II Limited Partnership
<TABLE>
-----------------------------------------------------------------------------
Statement of Partners' Capital (in thousands)
-----------------------------------------------------------------------------
<CAPTION>
                                              Limited
                                             Partners'
                                             Interests
                                             ----------
                                             Beneficial  Unrealized
                                     General  Assignee    Gain on
                                     Partners Interests Investments  Total
-----------------------------------------------------------------------------
<S>                                  <C>       <C>        <C>       <C>
Balance, December 31, 1996           $(2,393)  $161,665   $62,497   $221,769
-----------------------------------------------------------------------------

Net Income                                85      4,181         0      4,266
                                                                            
Distributions payable to Partners,                                           
  including $11.90 per BAC               (73)    (3,570)        0     (3,643)
                                                                             
Unrealized Gain on Investments             0          0     2,387      2,387 
                                                                             
-----------------------------------------------------------------------------
Balance, March 31, 1997 (Unaudited)  $(2,381)  $162,276   $64,884   $224,779
=============================================================================

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



</TABLE>























<PAGE> 18

Oxford Tax Exempt Fund II Limited Partnership
<TABLE>
--------------------------------------------------------------------
Statements of Cash Flows (in thousands)                            
(Unaudited)                                                        
--------------------------------------------------------------------
<CAPTION>                                                           
                                                For the three months
                                                   ended March 31,      
                                                --------------------
                                                   1997      1996   
-------------------------------------------------------------------- 
<S>                                                 <C>     <C>    
Operating Activities                                                     
  Net income                                        $ 4,266 $ 4,073  
  Adjustments to reconcile net income to net                          
     cash provided by operating activities:                            
  Changes in assets and liabilities:                                 
    Bond interest receivable                           (224)      0  
    Other, primarily interest receivable                  5       3  
    Due from affiliates                                   0     308  
    Accounts payable and accrued expenses              (499)     26  
--------------------------------------------------------------------
Net cash provided by operating activities             3,548   4,410  
-------------------------------------------------------------------- 
Net cash provided by investing activities                 0       0  
--------------------------------------------------------------------
Financing activities                                                
  Distributions paid to Partners and BAC Holders     (3,643) (3,643)
--------------------------------------------------------------------
Net cash used by financing activities                (3,643) (3,643)
--------------------------------------------------------------------
                                                                     
Net (decrease) increase in cash and cash equivalents    (95)    767
Cash and cash equivalents, beginning of period       12,072   9,698
--------------------------------------------------------------------
Cash and cash equivalents, end of period            $11,977 $10,465
====================================================================

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


</TABLE>














<PAGE> 19
-----------------------------------------------------------------
Notes to Financial Statements                                    
-----------------------------------------------------------------
                                                                 
Note 1.  Financial Statements                                    
                                                                  
   The financial statements reflect all adjustments which, in the
opinion  of  the  Managing General Partner of Oxford  Tax  Exempt
Fund  II  Limited  Partnership  ("Oxford  Tax  Exempt  Fund  II,"
"OTEF II," or the "Partnership"), are necessary to present fairly
OTEF   II's  financial  position  as  of  March  31,   1997   and
December  31, 1996, the Statements of Income for the  three-month
periods ended March 31, 1997 and 1996, the Statement of Partners'
Capital  as  of March 31, 1997, and the Statements of Cash  Flows
for  the  three-month periods ended March 31, 1997 and 1996,  and
the   notes  thereto,  in  accordance  with  generally   accepted
accounting  principles.   These  statements  should  be  read  in
conjunction  with  the  audited financial  statements  and  notes
included  in the Partnership's Annual Report for the  year  ended
December 31, 1996.

    In  February  1997, the Financial Accounting Standards  Board
issued  a  Statement of Financial Accounting Standards  No.  128,
"Earnings Per Share," which will change the reporting of earnings
per  share  effective  in  the fourth  quarter  of  1997.   Basic
earnings per share, a measure required by the new standard,  will
not  include stock options as common stock equivalents.  The  new
standard  also requires a company to report diluted earnings  per
share.

Note 2.  Business

    The  Partnership was formed under the laws of  the  State  of
Maryland  on  February 9, 1995, in connection with  a  plan  (the
"1995  OTEF Restructuring Plan") to restructure Oxford Tax Exempt
Fund Limited Partnership, a Maryland limited partnership ("OTEF,"
"Predecessor,"  or "OTEF II's predecessor").  Oxford  Tax  Exempt
Fund  II  Corporation, a Maryland corporation,  is  the  Managing
General  Partner  of  OTEF II (the "Managing  General  Partner").
OTEF  II  Associates  Limited  Partnership,  a  Maryland  limited
partnership,  is  the  associate  general  partner  of  OTEF   II
(together  with  the  Managing  General  Partner,  the   "General
Partners").

    Business  Plan  for Growth.  Under the Liquidity  and  Growth
Plan,  OTEF II will invest the proceeds of the Financing and  any
additional funds that OTEF II may obtain in new assets  described
below  to increase the distributions payable with respect to  the
New BACs and the value to the Liquidity BAC Holders.

    Refunding and Financing.  As of March 31, 1997, OTEF  II  had
refunded  12  of the Existing MRBs, which comprise  approximately
87.5%  of  OTEF  II's  portfolio,  including  two refundings that 
closed  during  the  first  quarter  of   1997  (Colonel   I  and
Middletown).  It  is  expected  that  the  refunding  of  the two
remaining Existing MRBs will  close  during  1997.  Refunding  an
Existing  MRB   means  exchanging  that  bond  for  newly  issued
refunding bonds ("Refunding Bonds")  with  approximately the same
principal amount, an extended maturity  and restructured interest 
<PAGE> 20
-----------------------------------------------------------------
Notes to Financial Statements
-----------------------------------------------------------------

rates that increase each year during  the  terms of the Refunding 
Bonds and that are designed to require  the limited  partnerships
which own the  properties  securing  the  bonds  (the  "Operating
Partnerships") to  pay  substantially all of their projected cash 
flow as interest on  the  Refunding  Bonds.  As a result of these 
refundings, the  estimated value  of  the  bonds  held by OTEF II
as   shown  on  the  Balance  Sheet  increased  by  approximately  
$2,387,000 as of March 31, 1997,  compared  to December 31, 1996.

    The Refunding Bonds are structured so as to consist of senior
bonds  ("Series  A  Bonds")  and subordinated  bonds  ("Series  B
Bonds").  This senior/subordinated structure will permit OTEF  II
to undertake the Financing, pursuant to which it will sell all or
a  portion of the Series A Bonds, or interests therein, that  are
designated as Liquidity Assets, or issue debt that may be secured
by  such  assets,  new assets or both.  OTEF II will  retain  the
related  Series  B  Bonds for the benefit of  the  Liquidity  BAC
Holders, and will retain both the senior Series A Bonds  and  the
subordinated  Series  B  Bonds, or interests  therein,  that  are
designated as Status Quo Assets for the benefit of the Status Quo
BAC  Holders. 

    In  addition to the proceeds from the Financing, OTEF II  may
acquire  new  assets: (i) from the proceeds  of  sales  or  other
dispositions  of  the  Refunding  Bonds  and  the  proceeds  from
principal  payments with respect to the Refunding  Bonds  (except
for  the  portion of such proceeds allocable to the  SQBs);  (ii)
from  the  proceeds of sales or other dispositions of new  assets
and  the  proceeds from principal payments with  respect  to  new
assets; (iii) from the proceeds of issuances of additional equity
securities, including additional limited partnership interests in
OTEF  II  and additional OTEF II BACs; (iv) by issuing additional
equity securities in exchange for new assets; or (v) by borrowing
funds  from  lenders  or  by issuing evidences  of  indebtedness.
Although  the  Managing  General  Partner  is  authorized   under
OTEF  II's  partnership agreement to reinvest cash  flow  in  new
assets,  it  has  no  current plans to do so in  the  foreseeable
future.

   Investment in New Assets. The Managing General Partner intends
to  invest  primarily in additional mortgage  revenue  bonds  and
securities  of  other  entities which primarily  hold  tax-exempt
mortgage  revenue bonds.  OTEF II also may invest in  multifamily
real  estate, senior living facilities or residential health care
facilities, or other direct or indirect debt or equity  interests
in  such  real  estate, some of which may give  rise  to  taxable
income,  but  the  Managing General Partner  does  not  currently
expect that these types of investments will be a significant part
of its business in the foreseeable future.  (All of the foregoing
are referred to collectively as "New Assets".)

    OTEF  II  generally will acquire additional mortgage  revenue
bonds  and  taxable  bonds  that are not  rated  by  any  of  the
nationally  recognized rating agencies (such as Moody's  Investor

<PAGE> 21
-----------------------------------------------------------------
Notes to Financial Statements
-----------------------------------------------------------------
Services, Inc. or Standard & Poor's Ratings Group) and  that  are
not credit-enhanced at the time of acquisition, although OTEF  II
may  seek  to have all or a portion of such bonds credit-enhanced
or  rated at a future date.  It also is expected that OTEF II may
invest in bonds, including bonds that may be secured by bonds  or
mortgages that are subordinated to senior bonds or mortgages held
by third parties, on terms that will permit it, in many cases, to
participate (either through stepped interest rates or  otherwise)
in  the  future  growth and increase in value of  the  properties
financed  by such bonds.  In addition, in the case of bonds  that
require restructuring, it is anticipated that OTEF II may be able
to  acquire such bonds on a discounted basis, that is, where  the
nominal  principal amount of the bond exceeds the purchase  price
and/or  the estimated current liquidation value of the underlying
property.

Note 3.  Significant Accounting Policies

    Method  of  Accounting.  OTEF II's financial  statements  are
prepared   in  accordance  with  generally  accepted   accounting
principles.

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

    Income Taxes.  No provision has been made for federal, state,
or  local  income taxes in the financial statements  of  OTEF  II
since  the  Partners  and  OTEF II (collectively,  "OTEF  II  BAC
Holders") are required to report on their individual tax  returns
their   allocable  share  of  taxable  income,   gains,   losses,
deductions, and credits of OTEF II.

    Valuation  of  Bonds.  The OTEF II Managing  General  Partner
estimated at March 31, 1997 that the fair value of the 12  Series
A  and  B  Bonds  and  the  two Existing MRBs  was  approximately
$217,916,000  and,  accordingly, OTEF II  recorded  a  credit  to
Partners' Capital in an amount equal to approximately $64,884,000
of unrealized gain on investments.  The current fair value of the
Series A and B Bonds and the Existing MRBs was determined by  the
Managing  General  Partner using the same cash  flow  methodology
applied  by  a  major investment banking firm in connection  with
structuring  advice rendered to OTEF II and its predecessor  with
respect to the 1995 OTEF Restructuring Plan.  The Series A  Bonds
are  valued at par based on comparable municipal bond securities,
and  all  other bonds (the Existing MRBs and the Series B  Bonds)
are  valued based on a discounted cash flow analysis.   For  this
purpose   the  applicable  cash  flows  are  based   on   certain
assumptions  concerning the Properties and the markets  in  which
they  are located, including the timing and realization  of  such
cash flows.

<PAGE> 22
-----------------------------------------------------------------
Notes to Financial Statements
-----------------------------------------------------------------

    Net Income and Distributions per Beneficial Assignee Interest
(BAC).   Net income and distributions per BAC are based upon  the
weighted average number of BACs outstanding during the applicable
year.

    Statements of cash flows.  The statements of cash  flows  are
intended to reflect only cash receipts and cash payment activity.
The  statements  do not reflect investing and financing  activity
that  affect recognized assets or liabilities that do not  result
in  cash  receipts  or  cash payments.   This  non-cash  activity
consists  of  distributions payable to Partners and OTEF  II  BAC
Holders of $3,642,796 at March 31, 1997 and 1996.

    Cash and cash equivalents.  Cash and cash equivalents consist
of  all  demand deposits and tax-exempt money market funds stated
at   cost,   which  approximates  market  value,  with   original
maturities of three months or less.

    Governance  and administrative expenses totaled $332,000  for
the  three-month  period ended March 31,  1997,  as  compared  to
$614,000  for the three-month period ended March 31,  1996.   The
decrease of $282,000 was primarily attributable to a decrease  in
governance expenses relating to the 1995 OTEF Restructuring  Plan
offset  by  an increase in expense reimbursements to the  General
Partners  and their affiliates.  Litigation and settlement  costs
due to the OTEF II Litigation totaled $98,000 for the three-month
period ended March 31, 1997.

Note 4.  Related Party Transactions

    Interests  in  OTEF II and the Operating  Partnerships.   The
General  Partners own interests in OTEF II that entitle  them  to
receive  a  share  of OTEF II's cash flow and possibly  of  sale,
refinancing  and  liquidation  proceeds.  Distributions  to   the
General Partners totaled $73,000 for March 31, 1997 and 1996.

    Affiliates  of the Managing General Partner that are  general
and  limited  partners  of  the Operating  Partnerships  have  an
interest  in  the  Operating Partnerships that entitles  them  to
receive  a  share  of  any cash flow and  sale,  refinancing  and
liquidation  proceeds  of  the  Operating  Partnerships.    Since
inception, the Operating Partnerships have not been able to  make
any distributions of cash flow to their respective partners.   In
addition, in connection with the 1995 OTEF Restructuring Plan and
after  the Existing MRBs are refunded, all cash flow attributable
to these interests will be pledged for the benefit of OTEF II.

    Compensation  and  Fees.  For the three-month  periods  ended
March  31,  1997 and 1996, the Operating Partnerships paid  total
property  and  asset  management fees of $577,000  and  $564,000,
respectively.   Of the $577,000 of property and asset  management
fees,  $428,000  was  paid to NHP, Inc.  and  certain  affiliates
(collectively,  "NHP"),  as compared to  $421,000  for  the  same
period in 1996.  The remaining fees totaling $149,000 was paid to
Oxford  Realty  Financial Group, Inc. ("ORFG"),  as  compared  to
<PAGE> 23
-----------------------------------------------------------------
Notes to Financial Statements
-----------------------------------------------------------------

$143,000  for  the same period in 1996.  During  the  three-month
periods ended March 31, 1997 and 1996, the Operating Partnerships
also  paid  ORFG, in the aggregate, $174,000 of fees pursuant  to
the  OTEF Restructuring Plan Administration/Asset Management  Fee
Agreement,  which  amount is equal to  0.25%  per  annum  of  the
principal  amount of the bonds collateralized by  the  properties
owned   by   the  Operating  Partnerships  ("Existing   Mortgaged
Properties").

    Fees  Payable  to  ORFG.  As discussed above,  ORFG  provides
various  management services, relating to the Existing  Mortgaged
Properties  and  OTEF II's investment therein.  It  will  provide
additional  services in connection with OTEF II's  investment  in
New Assets, as described above.  The fees payable to ORFG for the
services  it  is  providing currently (the "Existing  Fees")  are
operating expenses of the Operating Partnerships that are payable
prior  to the payment of interest on the Existing MRBs.  OTEF  II
did  not pay any fees in connection with OTEF II's investment  in
New  Assets  to  ORFG during the quarter ended  March  31,  1997;
however, with the implementation of the Liquidity and Growth Plan
in  1997, OTEF II anticipates that it will pay ORFG new fees (the
"New  Asset  Fees")  in  the near future.  The  paragraphs  below
describe the New Asset Fees:

    Acquisition Fee.  ORFG will be entitled to an acquisition fee
for finding, analyzing and acquiring New Assets.  The acquisition
fee,  which is payable on the closing of any transaction in which
OTEF  II  acquires  a  New Asset, is equal to  1.0%  of  (i)  the
purchase  price paid by OTEF II for the New Asset, or  (ii)  with
respect to a New Asset which is subordinated in payment to senior
indebtedness, the sum of (A) the purchase price paid by  OTEF  II
for its subordinated interest and (B) the principal amount of the
senior  interest, if any; provided, however, that no  acquisition
fee  shall  be paid with respect to the principal amount  of  any
such  senior  interest  if OTEF II has not purchased  the  senior
interest and neither the Managing General Partner nor any of  its
affiliates  had  any  material involvement  in  the  negotiation,
structuring  or  closing of the purchase of the senior  interest.
In  the  case of a New Asset which is subordinated in payment  to
senior indebtedness as of the closing of the transaction in which
OTEF  II  acquires  its  interest, the  maximum  acquisition  fee
payable  shall  be equal to 2.5% of the purchase  price  paid  by
OTEF II for such interest as of the date of closing.

    Advisory Fee.  OTEF II also will pay ORFG an advisory fee for
managing  OTEF  II's  New  Assets after their  acquisition.   The
advisory fee, which is payable annually, is equal to 0.5% of  (i)
the  purchase price paid by OTEF II for a New Asset, or (ii) with
respect to a New Asset which is subordinated in payment to senior
indebtedness, the sum of (A) the purchase price paid by  OTEF  II
for its subordinated interest and (B) the principal amount of the
senior  interest; provided, however, that if an affiliate of  the
Managing   General  Partner  is  receiving  fees   for   property
management  services pursuant to a property management  agreement

<PAGE> 24
-----------------------------------------------------------------
Notes to Financial Statements
-----------------------------------------------------------------
entered  into with the owner of an Additional Mortgaged Property,
the advisory fee will be equal to 0.5% of the purchase price paid
by  OTEF  II  for  the related New Asset.  In  addition,  if  the
Managing  General  Partner receives in any year  compensation  or
fees  from  an  unaffiliated person that serves as  the  property
manager for the Additional Mortgaged Property, the amount of  the
advisory fee payable with respect to the related New Asset  shall
be  reduced  by 50% of any such compensation or fees received  by
the Managing General Partner.

    Expense  Reimbursements.   The  Operating   Partnerships  and
OTEF  II  also reimburse ORFG for certain expenses it  incurs  in
providing   services  with  respect  to  the  Existing  Mortgaged
Properties  and  the administration of OTEF II's affairs.   Total
reimbursements  to the General Partners and their affiliates  for
the  three-month  periods ended March 31,  1997  and  1996,  were
$86,000  and  $22,900, respectively.  Such reimbursable amount is
determined  based on the actual time the officers  and  employees
devote to OTEF II based upon their respective salaries.

    Incentive Option Plan.  OTEF II intends to adopt an incentive
option  plan  (the  "Incentive Option Plan")  in  order  for  the
Managing General Partner to attract and retain key employees  and
advisers.  The Incentive Option Plan will authorize the  granting
to  the directors, officers and employees of the Managing General
Partner   and   certain   affiliates  of  options   to   purchase
approximately 26,000 OTEF II BACs (prior to any division  of  the
OTEF  II  BACs in connection with listing the OTEF II BACs  on  a
national securities exchange), which will represent approximately
8.3%  of  the  outstanding  OTEF II BACs (assuming  approximately
13,000 OTEF II BACs are converted into SQBs.)

    The  Managing  General Partner anticipates  that  options  to
purchase  all  or substantially all of the OTEF II  BACs  offered
pursuant  to the Incentive Option Plan will be granted  prior  to
the  effective date of listing of the OTEF II BACs  for  trading.
The  exercise price per BAC shall be the average of  the  closing
price  of an OTEF II BAC, as reported on the appropriate exchange
on  which the OTEF II BACs are listed or designated for the first
twenty  days  of  trading  or, with respect  to  any  BAC  option
exercised between the option grant date and the determination  of
the  average trading price, it shall be the fair market value  as
determined  by  the  Board of Directors of the  Managing  General
Partner on the basis of available prices.

Note 5.  Subsequent Events

    Effective  April 1, 1997, OTEF II issued in  book-entry  form
SQBs  to  BAC Holders who made a timely election to convert their
OTEF II  BACs to  SQBs,  representing  approximately  4.3% of the
outstanding BACs.  SQB  Holders  have  until  June  20, 1997,  to
exercise their option to require  OTEF II  to  purchase or redeem 
their  SQBs  pursuant to the Optional Sale Plan, described in the 
Information Memorandum dated December 2, 1996, that was furnished
to BAC Holders.  As  of  May  16,  1997,  3,115  SQBs  have  been
tendered by 162 Status Quo BAC Holders.
<PAGE> 25
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Notes to Financial Statements
-----------------------------------------------------------------

   On May 15, 1997, OTEF II made a quarterly cash distribution of
$3,642,796,  or $11.90 per  BAC (4.76% per annum on the  original
$1,000 invested per BAC) to BAC Holders of Record as of March 31,
1997.  This distribution is consistent with the distribution made
for the previous eight quarters.


















































<PAGE> 26
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Instructions for Investors who wish to reregister or transfer
  OTEF II BACs
-----------------------------------------------------------------

Please   follow   the   instructions   below   to  expedite   the
reregistration or transfer of ownership of any OTEF II Beneficial
Assignee Interests ("OTEF II BACs") that you may own.  Note  that
no transfers  or sales can be effected without the consent of the
Managing  General  Partner  and  the  completion  of  the  proper
documents.

  To  cover  the costs associated with processing transfers,  MMS
  Escrow & Transfer Agency, Inc. ("MMS"), the transfer agent  for
  OTEF  II, charges $25 for each transfer of OTEF II BACs between
  related  parties  and  $50 per seller  for  each  transfer  for
  consideration  (sale).  The only exception is a transfer  to  a
  surviving  joint  holder of BACs when the  other  joint  holder
  dies,  in  which case no fee is charged.  MMS charges $150  for
  the conversion of a BAC into a limited partner interest.

  To  transfer ownership of OTEF II BACs held in a Merrill  Lynch
  account,  please  have your Merrill Lynch financial  consultant
  contact  Merrill Lynch Partnership Operations in New Jersey  at
  (201)  557-1619  to  request the necessary transfer  documents.
  Merrill  Lynch  Partnership Operations will only  accept  calls
  from  your  financial  consultant.  YOU MUST  HAVE  THE  PROPER
  TRANSFER  DOCUMENTS  FROM MERRILL LYNCH TO EFFECT  A  TRANSFER.
  You  must  have  your financial consultant contact  Partnership
  Operations,  as  OTEF II Investor Services does  not  send  out
  transfer papers for BACs held in a Merrill Lynch account.

  Investors  who  no longer hold OTEF II BACs in a Merrill  Lynch
  account  should contact Investor Services at (248) 614-4550  or
  P.O.  Box  7090, Troy, Michigan 48007-7090, to obtain  transfer
  documents.  YOU MUST OBTAIN THE PROPER TRANSFER DOCUMENTS  FROM
  INVESTOR  SERVICES TO EFFECT A TRANSFER OF BACs WHICH YOU  HOLD
  PERSONALLY.

  MMS  does  not issue paper certificates to investors  who  take
  their  OTEF II BACs out of their Merrill Lynch accounts.  Paper
  confirmations   are   issued  instead.    (Please   note   that
  previously-issued OTEF paper certificates are no longer  valid.
  Investors  who  hold OTEF certificates may  retain  or  discard
  them,  as  they  choose.  It is no longer necessary  to  return
  certificates to MMS when transferring ownership interests.)

  If  an  individual who holds his or her OTEF II  BACs  directly
  wishes  to redeposit the BACs into a Merrill Lynch account,  he
  or  she  should send written instructions to Investor  Services
  after  the  Merrill  Lynch account has been  opened.   OTEF  II
  Investor  Services will then instruct Merrill Lynch to  deposit
  the BACs into the account.






<PAGE> 27
-----------------------------------------------------------------
Instructions for Investors who wish to reregister or transfer
  OTEF II BACS
-----------------------------------------------------------------

  Please  remember to notify Investor Services in writing at  the
  address  below  or by calling (248) 614-4550 in the  event  you
  change  your mailing address or your financial consultant.   We
  can  then continue to provide you and your representative  with
  timely information about your investment in OTEF II.

  The  Quarterly  Report  on  Form 10-Q  for  the  quarter  ended
  March   31,  1997,  filed  with  the  Securities  and  Exchange
  Commission, is available to BAC Holders and may be obtained  by
  writing:

                                
                        Investor Services
          Oxford Tax Exempt Fund II Limited Partnership
                          P.O. Box 7090
                    Troy, Michigan 48007-7090
                                
                         (248) 614-4550