SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C.  20549

                           FORM 10-QSB

           Quarterly Report Under Section 13 or 15(d)
             of The Securities Exchange Act of 1934

             For the Quarter Ended:  March 31, 2000

               Commission file number:  333-67287


                   AEI INCOME & GROWTH FUND 23 LLC
(Exact Name of Small Business Issuer as Specified in its Charter)


      State of Delaware                    41-1922579
(State or other Jurisdiction of         (I.R.S. Employer
Incorporation or Organization)        Identification No.)


  1300 Minnesota World Trade Center, St. Paul, Minnesota 55101
            (Address of Principal Executive Offices)

                          (651) 227-7333
                   (Issuer's telephone number)


                         Not Applicable
 (Former name, former address and former fiscal year, if changed
                       since last report)

Check  whether  the issuer (1) 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

         Transitional Small Business Disclosure Format:

                          Yes        No  [X]




                 AEI INCOME & GROWTH FUND 23 LLC


                              INDEX




PART I.Financial Information

 Item 1. Balance Sheet as of March 31, 2000 and December 31, 1999

          Statements for the Periods ended March 31, 2000 and 1999:

             Operations

             Cash Flows

             Changes in Members' Equity

          Notes to Financial Statements

 Item 2. Management's Discussion and Analysis

PART II. Other Information

 Item 1. Legal Proceedings

 Item 2. Changes in Securities

 Item 3. Defaults Upon Senior Securities

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

 Item 5. Other Information

 Item 6. Exhibits and Reports on Form 8-K

<PAGE>
                 AEI INCOME & GROWTH FUND 23 LLC

                          BALANCE SHEET

              MARCH 31, 2000 AND DECEMBER 31, 1999

                           (Unaudited)


                             ASSETS

                                                       2000          1999

CURRENT ASSETS:
  Cash and Cash Equivalents                        $ 3,382,776    $ 2,583,998
  Receivables                                            4,990              0
                                                    -----------    -----------
      Total Current Assets                           3,387,766      2,583,998
                                                    -----------    -----------
INVESTMENTS IN REAL ESTATE:
  Land                                                 459,500              0
  Construction in Progress                             207,450              0
  Property Acquisition Costs                            32,566              0
                                                    -----------    -----------
      Net Investments in Real Estate                   699,516              0
                                                    -----------    -----------
      Total Assets                                 $ 4,087,282    $ 2,583,998
                                                    ===========    ===========

                        LIABILITIES AND MEMBERS' EQUITY

CURRENT LIABILITIES:
  Payable to AEI Fund Management, Inc.             $   114,063    $    72,484
  Distributions Payable                                 63,916         40,462
                                                    -----------    -----------
      Total Current Liabilities                        177,979        112,946
                                                    -----------    -----------
MEMBERS' EQUITY (DEFICIT):
  Managing Members' Equity                              (2,521)          (633)
  Limited Members' Equity, $1,000 Unit Value;
   24,000 Units authorized; 4,760 and 2,994
   Units issued and outstanding in 2000 and
   1999, respectively                                3,911,824      2,471,685
                                                    -----------    -----------
      Total Members' Equity                          3,909,303      2,471,052
                                                    -----------    -----------
          Total Liabilities and Members' Equity    $ 4,087,282    $ 2,583,998
                                                    ===========    ===========


 The accompanying Notes to Financial Statements are an integral
                     part of this statement.
</PAGE>
<PAGE>

                 AEI INCOME & GROWTH FUND 23 LLC

                     STATEMENT OF OPERATIONS

                 FOR THE PERIODS ENDED MARCH 31

                           (Unaudited)

                                                        2000           1999

INCOME:
   Rent                                          $     3,816     $         0
   Investment Income                                  39,386              20
                                                  -----------     -----------
        Total Income                                  43,202              20
                                                  -----------     -----------

EXPENSES:
   LLC Administration - Affiliates                    37,478           5,225
   LLC Administration and Property
      Management - Unrelated Parties                   4,039             900
                                                  -----------     -----------
        Total Expenses                                41,517           6,125
                                                  -----------     -----------

NET INCOME (LOSS)                                $     1,685     $    (6,105)
                                                  ===========     ===========

NET INCOME (LOSS) ALLOCATED:
   Managing Members                              $        50     $    (6,105)
   Limited Members                                     1,635               0
                                                  -----------     -----------
                                                 $     1,685     $    (6,105)
                                                  ===========     ===========

NET INCOME (LOSS) PER LIMITED MEMBERSHIP UNIT
  (3,601  weighted average Units
   outstanding in 2000)                          $       .45     $       N/A
                                                  ===========     ===========


 The accompanying Notes to Financial Statements are an integral
                     part of this statement.
</PAGE>
<PAGE>
                 AEI INCOME & GROWTH FUND 23 LLC

                     STATEMENT OF CASH FLOWS

                 FOR THE PERIODS ENDED MARCH 31

                           (Unaudited)

                                                        2000            1999

CASH FLOWS FROM OPERATING ACTIVITIES:
   Net Income (Loss)                                $     1,685   $    (6,105)

   Adjustments to Reconcile Net Income (Loss) to Net Cash
   Provided by Operating Activities:
     Increase in Receivables                             (4,990)            0
     Increase in Payable to
        AEI Fund Management, Inc.                        41,579         6,125
                                                     -----------   -----------
        Total Adjustments                                36,589         6,125
                                                     -----------   -----------
        Net Cash Provided By
        Operating Activities                             38,274            20
                                                     -----------   -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
   Investments in Real Estate                          (699,516)            0
                                                     -----------   -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
   Capital Contributions from Limited Members         1,766,092             0
   Organization and Syndication Costs                  (264,910)            0
   Increase in Distributions Payable                     23,454             0
   Distributions to Members                             (64,616)            0
                                                     -----------   -----------
        Net Cash Provided By
        Financing Activities                          1,460,020             0
                                                     -----------   -----------

NET INCREASE IN CASH AND CASH EQUIVALENTS               798,778            20

CASH AND CASH EQUIVALENTS, beginning of period        2,583,998         1,000
                                                     -----------   -----------
CASH AND CASH EQUIVALENTS, end of period            $ 3,382,776   $     1,020
                                                     ===========   ===========


 The accompanying Notes to Financial Statements are an integral
                     part of this statement.
</PAGE>
<PAGE>

                 AEI INCOME & GROWTH FUND 23 LLC

             STATEMENT OF CHANGES IN MEMBERS' EQUITY

                 FOR THE PERIODS ENDED MARCH 31

                           (Unaudited)

                                                                    Limited
                                                                     Member
                             Managing     Limited                    Units
                             Members      Members       Total     Outstanding


BALANCE, December 31, 1998  $  1,000   $         0  $     1,000           0

  Net Loss                    (6,105)            0       (6,105)
                             ---------  -----------  -----------  -----------
BALANCE, March 31, 1999     $ (5,105)  $         0  $    (5,105)          0
                             =========  ===========  ===========  ===========


BALANCE, December 31, 1999  $   (633)  $ 2,471,685  $ 2,471,052    2,993.82

  Capital Contributions            0     1,766,092    1,766,092    1,766.09

  Organization &
    Syndication Costs              0      (264,910)    (264,910)

  Distributions               (1,938)      (62,678)     (64,616)

  Net Income                      50         1,635        1,685
                             ---------  -----------  -----------  -----------
BALANCE, March 31, 2000     $ (2,521)  $ 3,911,824  $ 3,909,303    4,759.91
                             =========  ===========  ===========  ===========


 The accompanying Notes to Financial Statements are an integral
                     part of this statement.
</PAGE>
<PAGE>

                 AEI INCOME & GROWTH FUND 23 LLC

                  NOTES TO FINANCIAL STATEMENTS

                         MARCH 31, 2000

                           (Unaudited)

(1)  The  condensed  statements included herein have been  prepared
     by   the  LLC,  without  audit,  pursuant  to  the  rules  and
     regulations  of  the Securities and Exchange  Commission,  and
     reflect   all  adjustments  which  are,  in  the  opinion   of
     management,  necessary to a fair statement of the  results  of
     operations for the interim period, on a basis consistent  with
     the  annual audited statements.  The adjustments made to these
     condensed   statements  consist  only  of   normal   recurring
     adjustments.   Certain information, accounting  policies,  and
     footnote    disclosures   normally   included   in   financial
     statements  prepared  in  accordance with  generally  accepted
     accounting principles have been condensed or omitted  pursuant
     to  such rules and regulations, although the LLC believes that
     the   disclosures   are  adequate  to  make  the   information
     presented   not  misleading.   It  is  suggested  that   these
     condensed  financial  statements be read in  conjunction  with
     the  financial  statements  and  the  summary  of  significant
     accounting  policies and notes thereto included in  the  LLC's
     latest annual report on Form 10-KSB.

(2)  Organization -

     AEI  Income  &  Growth  Fund 23 LLC  (the  LLC),  a  Limited
     Liability Company, was formed on October 14, 1998 to acquire
     and  lease commercial properties to operating tenants.   The
     LLC's  operations  are managed by AEI Fund  Management  XXI,
     Inc.  (AFM),  the Managing Member.  Robert P.  Johnson,  the
     President and sole shareholder of AFM, serves as the Special
     Managing   Member  and  an  affiliate  of  AFM,   AEI   Fund
     Management, Inc., performs the administrative and  operating
     functions for the LLC.

     The  terms of the offering call for a subscription price  of
     $1,000  per  LLC Unit, payable on acceptance of  the  offer.
     Under the terms of the Operating Agreement, 24,000 LLC Units
     are  available for subscription which, if fully  subscribed,
     will  result  in  contributed Limited  Members'  capital  of
     $24,000,000.  The LLC commenced operations on September  30,
     1999  when minimum subscriptions of 1,500 Limited Membership
     Units  ($1,500,000)  were  accepted.   At  March  31,  2000,
     4,759.91 Units ($4,759,910) were subscribed and accepted  by
     the  LLC.  The Managing Members have contributed capital  of
     $1,000.   The  LLC shall continue until December  31,  2048,
     unless  dissolved, terminated and liquidated prior  to  that
     date.

     During operations, any Net Cash Flow, as defined, which  the
     Managing Members determine to distribute will be distributed
     97%  to  the Limited Members and 3% to the Managing Members.
     Distributions to Limited Members will be made  pro  rata  by
     Units.

     Any  Net  Proceeds  of Sale, as defined, from  the  sale  or
     financing of properties which the Managing Members determine
     to distribute will, after provisions for debts and reserves,
     be  paid  in  the following manner: (i) first,  99%  to  the
     Limited  Members  and 1% to the Managing Members  until  the
     Limited  Members  receive  an amount  equal  to:  (a)  their
     Adjusted Capital Contribution plus (b) an amount equal to 7%
     of their Adjusted Capital Contribution per annum, cumulative
     but not compounded, to the extent not previously distributed
     from  Net  Cash  Flow; (ii) any remaining  balance  will  be
     distributed  90%  to  the Limited Members  and  10%  to  the
     Managing Members.  Distributions to the Limited Members will
     be made pro rata by Units.


                 AEI INCOME & GROWTH FUND 23 LLC

                  NOTES TO FINANCIAL STATEMENTS
                           (Continued)

(2)  Organization - (Continued)

     For  tax  purposes,  profits  from  operations,  other  than
     profits  attributable  to  the  sale,  exchange,  financing,
     refinancing  or  other  disposition  of  property,  will  be
     allocated  first  in the same ratio in  which,  and  to  the
     extent, Net Cash Flow is distributed to the Members for such
     year.  Any additional profits will be allocated in the  same
     ratio  as  the  last dollar of Net Cash Flow is distributed.
     Net  losses  from operations will be allocated  99%  to  the
     Limited Members and 1% to the Managing Members.

     For  tax purposes, profits arising from the sale, financing,
     or  other  disposition  of property  will  be  allocated  in
     accordance  with  the Operating Agreement  as  follows:  (i)
     first,  to  those  Members with deficit  balances  in  their
     capital  accounts  in an amount equal to  the  sum  of  such
     deficit  balances; (ii) second, 99% to the  Limited  Members
     and  1%  to the Managing Members until the aggregate balance
     in  the Limited Members' capital accounts equals the sum  of
     the Limited Members' Adjusted Capital Contributions plus  an
     amount  equal  to 7% of their Adjusted Capital Contributions
     per  annum, cumulative but not compounded, to the extent not
     previously  allocated;  (iii)  third,  the  balance  of  any
     remaining  gain  will then be allocated 90% to  the  Limited
     Members  and  10% to the Managing Members.  Losses  will  be
     allocated 98% to the Limited Members and 2% to the  Managing
     Members.

     The  Managing Members are not required to currently  fund  a
     deficit  capital balance.  Upon liquidation of  the  LLC  or
     withdrawal  by a Managing Member, the Managing Members  will
     contribute to the LLC an amount equal to the lesser  of  the
     deficit balances in their capital accounts or 1.01%  of  the
     total capital contributions of the Limited Members over  the
     amount previously contributed by the Managing Members.

(3)  Investments in Real Estate -

     On  February 25, 2000, the LLC purchased a parcel of land in
     Kettering,  Ohio  for  $459,500.   The  land  is  leased  to
     Tumbleweed,  Inc.  (TWI)  under a  Lease  Agreement  with  a
     primary  term  of  15  years and annual rental  payments  of
     $39,058.  Simultaneously with the purchase of the land,  the
     LLC  entered  into a Development Financing  Agreement  under
     which the LLC will advance funds to TWI for the construction
     of  a Tumbleweed restaurant on the site.  Through March  31,
     2000, the LLC had advanced $207,450 for the construction  of
     the  property and is charging interest on the advances at  a
     rate  of 8.5%.  The total purchase price, including the cost
     of  the  land, will be approximately $1,372,000.  After  the
     construction  is  complete,  the  Lease  Agreement  will  be
     amended  to  require annual rental payments of approximately
     $135,500.

     On  April  18, 2000, the LLC purchased a parcel of  land  in
     Victoria,  Texas for $409,500.  The land is leased  to  Kona
     Restaurant Group, Inc. (KRG) under a Lease Agreement with  a
     primary  term  of  17  years and annual rental  payments  of
     $42,998.  Simultaneously with the purchase of the land,  the
     LLC  entered  into a Development Financing  Agreement  under
     which the LLC will advance funds to KRG for the construction
     of  a  Johnny Carino's restaurant on the site.  The  LLC  is
     charging  interest on the advances at a rate of 10.5%.   The
     total  purchase price, including the cost of the land,  will
     be  approximately  $1,800,000.  After  the  construction  is
     complete,  the  Lease Agreement will be amended  to  require
     annual rental payments of approximately $189,000.


                 AEI INCOME & GROWTH FUND 23 LLC

                  NOTES TO FINANCIAL STATEMENTS
                           (Continued)

(3)  Investments in Real Estate - (Continued)

     On April 19, 2000, the LLC purchased a parcel of land in San
     Antonio,  Texas  for  $1,558,000.  The  land  is  leased  to
     Razzoo's,  Inc. (RI) under a Lease Agreement with a  primary
     term  of  15  years and annual rental payments of  $132,430.
     Simultaneously  with  the purchase  of  the  land,  the  LLC
     entered  into a Development Financing Agreement under  which
     the  LLC will advance funds to RI for the construction of  a
     Razzoo's  restaurant  on  the site.   The  LLC  is  charging
     interest  on  the  advances at a rate of  8.5%.   The  total
     purchase  price,  including the cost of the  land,  will  be
     approximately   $3,510,000.   After  the   construction   is
     complete,  the  Lease Agreement will be amended  to  require
     annual rental payments of approximately $342,000.

     The  LLC has incurred net costs of $32,566 relating  to  the
     review  of  potential property acquisitions which have  been
     capitalized and will be allocated to properties acquired  in
     future periods.

(4)  Payable to AEI Fund Management, Inc. -

     AEI  Fund  Management, Inc. performs the administrative  and
     operating  functions for the LLC.  The payable to  AEI  Fund
     Management  represents the balance due for  those  services.
     This balance is non-interest bearing and unsecured and is to
     be paid in the normal course of business.


ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS

Results of Operations

        For  the  three  months ended March  31,  2000,  the  LLC
recognized rental income of $3,816.  During the same period,  the
LLC   earned  $39,386  in  investment  income  from  subscription
proceeds which were invested in a short-term money market account
and   from   development   advances.   This   investment   income
constituted  91% of total income for the period.  The  percentage
of  total  income  represented by investment income  declines  as
subscription proceeds are invested in properties.

       During the three months ended March 31, 2000 and 1999, the
LLC paid administration expenses to affiliated parties of $37,478
and  $5,225, respectively.  These administration expenses include
initial  start-up  costs and administrative  expenses  associated
with   processing   distributions,  reporting  requirements   and
correspondence to the Limited Members.  During the same  periods,
the  LLC  incurred administration expenses from unrelated parties
of  $4,039  and  $900,  respectively.  These  expenses  represent
direct  payments  to  third parties for legal  and  filing  fees,
direct  administrative costs, outside audit and accounting costs,
and other property costs.

        The  LLC  distributes all of its net  income  during  the
offering  and  acquisition  phases,  and  if  net  income   after
deductions  for  depreciation  is  not  sufficient  to  fund  the
distributions, the LLC may distribute other available  cash  that
constitutes capital for accounting purposes.

ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS  (Continued)

        As of December 31, 1999, the LLC's cash distribution rate
was  7.0%  on  an  annualized basis.  Pursuant to  the  Operating
Agreement, distributions of Net Cash Flow were allocated  97%  to
the Limited Members and 3% to the Managing Members.

       Since the LLC has only recently purchased its real estate,
inflation  has  had a minimal effect on income  from  operations.
The Leases may contain cost of living increases which will result
in  an  increase  in rental income over the term of  the  Leases.
Inflation  also may cause the LLC's real estate to appreciate  in
value.   However, inflation and changing prices may also have  an
adverse  impact  on  the  operating margins  of  the  properties'
tenants  which  could  impair  their  ability  to  pay  rent  and
subsequently  reduce  the  LLC's  Net  Cash  Flow  available  for
distributions.

Liquidity and Capital Resources

        The  LLC's primary sources of cash will be proceeds  from
the  sale of Units, investment income, rental income and proceeds
from  the  sale of property.  Its primary uses of  cash  will  be
investment  in real properties, payment of expenses  involved  in
the sale of Units, the organization of the LLC, the management of
properties,  the administration of the LLC, and  the  payment  of
distributions.

        The Operating Agreement requires that no more than 15% of
the  proceeds  from  the  sale of Units be  applied  to  expenses
involved  in the sale of Units (including Commissions)  and  that
such expenses, together with acquisition expenses, not exceed 20%
of  the proceeds from the sale of Units.  As set forth under  the
caption  "Estimated  Use  of Proceeds"  of  the  Prospectus,  the
Managing  Members  anticipate that 15% of such proceeds  will  be
applied  to cover organization and offering expenses if only  the
minimum proceeds are obtained and that 14% of such proceeds  will
be applied to such expenses if the maximum proceeds are obtained.
To   the  extent  organization  and  offering  expenses  actually
incurred  exceed 15% of proceeds, they are borne by the  Managing
Members.

        Before the acquisition of all such properties, cash  flow
from  operating activities is not significant.  Net income, after
adjustment for depreciation, is lower during the first few  years
of  operations as administrative expenses remain high and a large
amount of the LLC's assets remain invested on a short-term  basis
in  lower-yielding cash equivalents.  Net income will become  the
largest component of cash flow from operating activities and  the
largest  component  of  cash flow after  the  completion  of  the
acquisition phase.

        The  Operating Agreement requires that all proceeds  from
the  sale  of  Units be invested or committed  to  investment  in
properties  by  the  later of two years after  the  date  of  the
Prospectus or six months after termination of the offer and  sale
of Units.  While the LLC is purchasing properties, cash flow from
investing  activities (investment in real property)  will  remain
negative  and  will constitute the principal  use  of  the  LLC's
available  cash  flow.  Until capital is invested in  properties,
the LLC will remain extremely liquid.

        On  February 25, 2000, the LLC purchased a parcel of land
in   Kettering,  Ohio  for  $459,500.   The  land  is  leased  to
Tumbleweed,  Inc. (TWI) under a Lease Agreement  with  a  primary
term   of  15  years  and  annual  rental  payments  of  $39,058.
Simultaneously  with the purchase of the land,  the  LLC  entered
into  a Development Financing Agreement under which the LLC  will
advance  funds  to  TWI  for  the construction  of  a  Tumbleweed
restaurant  on  the site.  Through March 31, 2000,  the  LLC  had
advanced  $207,450 for the construction of the  property  and  is
charging  interest on the advances at a rate of 8.5%.  The  total
purchase  price,  including  the  cost  of  the  land,  will   be
approximately  $1,372,000.  After the construction  is  complete,
the  Lease  Agreement  will be amended to require  annual  rental
payments of approximately $135,500.

ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS  (Continued)

        On April 18, 2000, the LLC purchased a parcel of land  in
Victoria,  Texas  for  $409,500.  The  land  is  leased  to  Kona
Restaurant  Group,  Inc.  (KRG) under a Lease  Agreement  with  a
primary  term of 17 years and annual rental payments of  $42,998.
Simultaneously  with the purchase of the land,  the  LLC  entered
into  a Development Financing Agreement under which the LLC  will
advance  funds  to KRG for the construction of a Johnny  Carino's
restaurant  on  the site.  The LLC is charging  interest  on  the
advances at a rate of 10.5%.  The total purchase price, including
the  cost  of the land, will be approximately $1,800,000.   After
the construction is complete, the Lease Agreement will be amended
to require annual rental payments of approximately $189,000.

        On April 19, 2000, the LLC purchased a parcel of land  in
San  Antonio,  Texas  for $1,558,000.   The  land  is  leased  to
Razzoo's,  Inc. (RI) under a Lease Agreement with a primary  term
of   15   years   and   annual  rental  payments   of   $132,430.
Simultaneously  with the purchase of the land,  the  LLC  entered
into  a Development Financing Agreement under which the LLC  will
advance funds to RI for the construction of a Razzoo's restaurant
on  the site.  The LLC is charging interest on the advances at  a
rate  of  8.5%.  The total purchase price, including the cost  of
the   land,   will  be  approximately  $3,510,000.    After   the
construction is complete, the Lease Agreement will be amended  to
require annual rental payments of approximately $342,000.

        As  of  March 31, 2000, the LLC's commitments to  acquire
properties  exceeded  funds available from  current  subscription
proceeds.  The LLC anticipates future subscription proceeds  will
be adequate to fund the final acquisition of these commitments.

        During the offering of Units, the LLC's primary source of
cash  flow will be from the sale of LLC Units.  The LLC commenced
its  offering  of LLC Units to the public through a  registration
statement which became effective March 23, 1999.  From March  23,
1999  to  September  30, 1999, the minimum number  of  LLC  Units
(1,500) needed to form the LLC were sold.  On September 30, 1999,
a total of 1,868.616 Units ($1,868,616) were transferred into the
LLC.   Through  March  31,  2000,  the  LLC  raised  a  total  of
$4,759,910  from  the  sale  of 4,759.910  Units.   The  Managing
General Partner has extended the offering of Units to the earlier
of  completion  of  sale of all Units or March  22,  2001.   From
subscription proceeds, the LLC paid organization and  syndication
costs (which constitute a reduction of capital) of $713,728.

        After  completion  of the acquisition  phase,  the  LLC's
primary  use of cash flow is distribution and redemption payments
to Members.  The LLC declares its regular quarterly distributions
before  the end of each quarter and pays the distribution in  the
first  week  after the end of each quarter.  The LLC attempts  to
maintain a stable distribution rate from quarter to quarter.

        Beginning in 2002, the LLC may acquire Units from Limited
Members who have tendered their Units to the LLC.  Such Units may
be  acquired at a discount.  The LLC is not obligated to purchase
in  any  year more than 2% of the number of Units outstanding  at
the  beginning  of  the  year.  In no  event  shall  the  LLC  be
obligated  to  purchase Units if, in the sole discretion  of  the
Managing  Member,  such  purchase would  impair  the  capital  or
operation of the LLC.

        Until  capital is invested in properties,  the  LLC  will
remain   extremely   liquid.   After   completion   of   property
acquisitions, the LLC will attempt to maintain a cash reserve  of
only   approximately  1%  of  subscription   proceeds.    Because
properties  are  purchased for cash and leased  under  triple-net
leases,   this   is   considered   adequate   to   satisfy   most
contingencies.

ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS  (Continued)

Cautionary Statement for Purposes of the "Safe Harbor" Provisions
of the Private Securities Litigation Reform Act of 1995

         The   foregoing  Management's  Discussion  and  Analysis
contains various "forward looking statements" within the  meaning
of   federal   securities   laws  which  represent   management's
expectations  or  beliefs  concerning  future  events,  including
statements  regarding anticipated application of  cash,  expected
returns  from rental income, growth in revenue, taxation  levels,
the  sufficiency  of  cash to meet operating expenses,  rates  of
distribution,  and  other  matters.   These,  and  other  forward
looking  statements  made by the LLC, must be  evaluated  in  the
context  of  a  number  of  factors that  may  affect  the  LLC's
financial  condition  and  results of operations,  including  the
following:

<BULLET>  Market  and economic conditions which  affect
          the  value of the properties the LLC owns and the  cash
          from rental income such properties generate;

<BULLET>  the federal income tax consequences of rental
          income,  deductions, gain on sales and other items  and
          the affects of these consequences for investors;

<BULLET>  resolution  by  the  Managing   Members   of
          conflicts with which they may be confronted;

<BULLET>  the  success  of  the  Managing  Member   of
          locating   properties   with  favorable   risk   return
          characteristics;

<BULLET>  the effect of tenant defaults; and

<BULLET>  the condition of the industries in which  the
          tenants of properties owned by the LLC operate.


                   PART II - OTHER INFORMATION

ITEM 1.LEGAL PROCEEDINGS

       There  are no material pending legal proceedings to  which
  the LLC is a party or of which the LLC's property is subject.

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.


                   PART II - OTHER INFORMATION
                           (Continued)

ITEM 6.EXHIBITS AND REPORTS ON FORM 8-K

       a. Exhibits -
                         Description

       10.1   Development   Financing   Agreement
              dated  April 18, 2000 between the LLC  and
              Kona  Restaurant Group, Inc.  relating  to
              the   property  at  4904  North   Navarro,
              Victoria,    Texas    (incorporated     by
              reference  to  Exhibit 10.1  of  Form  8-K
              filed with the Commission on May 3, 2000).

       10.2   Net Lease Agreement dated April  18,
              2000  between the LLC and Kona  Restaurant
              Group,  Inc.  relating to the property  at
              4904   North   Navarro,  Victoria,   Texas
              (incorporated  by  reference  to   Exhibit
              10.2   of   Form   8-K  filed   with   the
              Commission on May 3, 2000).

       10.3   Development   Financing   Agreement
              dated  April 19, 2000 between the LLC  and
              Razzoo's,  Inc. relating to  the  property
              at  14404  U.S.  Highway  281  North,  San
              Antonio,  Texas (incorporated by reference
              to  Exhibit  10.3 of Form 8-K  filed  with
              the Commission on May 3, 2000).

       10.4   Net Lease Agreement dated April  19,
              2000  between  the LLC and Razzoo's,  Inc.
              relating  to  the property at  14404  U.S.
              Highway  281  North,  San  Antonio,  Texas
              (incorporated  by  reference  to   Exhibit
              10.4   of   Form   8-K  filed   with   the
              Commission on May 3, 2000).

       27     Financial Data Schedule  for  period
              ended March 31, 2000.

       b. Reports filed on Form 8-K - None.


                           SIGNATURES

        In  accordance with the requirements of the Exchange Act,
the  Registrant has caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.


Dated:  May 12, 2000          AEI Income & Growth Fund 23 LLC
                              By:  AEI Fund Management XXI, Inc.
                              Its: Managing Member



                              By: /s/ Robert P. Johnson
                                      Robert P. Johnson
                                      President
                                      (Principal Executive Officer)



                              By: /s/ Mark E. Larson
                                      Mark E. Larson
                                      Chief Financial Officer
                                      (Principal Accounting Officer)