Form 10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                   |X|    Quarterly Report Pursuant to Section 13
                          or 15(d) of the Securities Exchange Act
                          of 1934. For the quarterly period ended
                          September 30, 2000

                   |_|    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 333-62477

                      ATEL Capital Equipment Fund VIII, LLC
             (Exact name of registrant as specified in its charter)

California                                                     94-3307404
----------                                                     ----------
(State or other jurisdiction of                              (I. R. S. Employer
 incorporation or organization)                              Identification No.)

           235 Pine Street, 6th Floor, San Francisco, California 94104
                    (Address of principal executive offices)

       Registrant's telephone number, including area code: (415) 989-8800



Indicate  by a 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  |_|

                       DOCUMENTS INCORPORATED BY REFERENCE

                                      None


                                       1
<PAGE>

                          Part I. FINANCIAL INFORMATION

Item 1.  Financial Statements.





















                                       2
<PAGE>

                      ATEL CAPITAL EQUIPMENT FUND VIII, LLC

                                 BALANCE SHEETS

                    SEPTEMBER 30, 2000 AND DECEMBER 31, 1999
                                   (Unaudited)

                                     ASSETS

                                               2000              1999
                                               ----              ----
Cash and cash equivalents                 $   2,676,152     $   3,973,342
Accounts receivable                             3,813,129          2,124,786
Other assets                                      122,500            145,000
Investments in leases                         183,727,836        139,420,208
                                         ----------------- ------------------
Total assets                                 $190,339,617       $145,663,336
                                         ================= ==================


                        LIABILITIES AND MEMBERS' CAPITAL


Long-term debt                               $ 83,596,000       $ 64,674,000
Non-recourse debt                               5,106,764          7,174,617
Line of credit                                  6,592,627          7,500,000

Accounts payable:
   Managing member                                516,675            811,287
   Other                                          285,902              1,123

Accrued interest payable                          233,512            114,602

Unearned operating lease income                 1,994,961          1,257,697
                                         ----------------- ------------------
Total liabilities                              98,326,441         81,533,326
Members' capital:
     Managing member                                    -                  -
     Other members                             92,013,176         64,130,010
                                         ----------------- ------------------
Total members' capital                         92,013,176         64,130,010
                                         ----------------- ------------------
Total liabilities and members' capital       $190,339,617       $145,663,336
                                         ================= ==================






                             See accompanying notes.


                                       3
<PAGE>

                      ATEL CAPITAL EQUIPMENT FUND VIII, LLC

                                INCOME STATEMENTS

                       NINE AND THREE MONTH PERIODS ENDED
                           SEPTEMBER 30, 2000 AND 1999
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                      Nine Months                          Three Months
                                                                  Ended September 30,                   Ended September 30,
                                                                  -------------------                   -------------------
                                                                2000               1999               2000              1999
                                                                ----               ----               ----              ----
Revenues:
   Leasing activities:
<S>                                                             <C>                <C>               <C>                <C>
      Operating leases                                          $21,367,986        $ 4,359,539       $ 8,553,136        $ 2,878,064
      Direct financing leases                                       553,989            212,286           284,861             86,798
      Gain on sales of assets                                         1,453                  -                 -                  -
Interest                                                            126,961             72,585            52,973             53,496
Other                                                                10,729                372             8,156                165
                                                          ------------------ ------------------ ----------------- ------------------
                                                                 22,061,118          4,644,782         8,899,126          3,018,523
Expenses:
Depreciation and amortization                                    16,078,770          2,792,084         5,894,918          1,748,864
Interest expense                                                  5,208,362            764,541         1,897,752            341,959
Administrative cost reimbursements to Managing
   Member                                                           935,437            516,568           394,855            240,445
Asset management fees to Managing Member                            973,761            232,387           380,784            153,399
Professional fees                                                   102,055             29,213            61,145              1,602
Other                                                               341,126             40,006           274,197             23,700
                                                          ------------------ ------------------ ----------------- ------------------
                                                                 23,639,511          4,374,799         8,903,651          2,509,969
                                                          ------------------ ------------------ ----------------- ------------------
Net (loss) income                                              $ (1,578,393)         $ 269,983          $ (4,525)         $ 508,554
                                                          ================== ================== ================= ==================

Net (loss) income:
   Managing member                                                $ 536,365           $ 20,249         $ 202,487           $ 38,142
   Other members                                                 (2,114,758)           249,734          (207,012)           470,412
                                                          ------------------ ------------------ ----------------- ------------------
                                                               $ (1,578,393)         $ 269,983          $ (4,525)         $ 508,554
                                                          ================== ================== ================= ==================

Net (loss) income per Limited Liability Company
   Unit                                                             $ (0.21)            $ 0.08           $ (0.02)            $ 0.09
Weighted average number of Units outstanding                      9,887,359          3,014,585        11,359,758          4,998,549
</TABLE>




                                       4
<PAGE>

                      ATEL CAPITAL EQUIPMENT FUND VIII, LLC

                    STATEMENT OF CHANGES IN MEMBERS' CAPITAL

                             NINE MONTH PERIOD ENDED
                               SEPTEMBER 30, 2000
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                   Other Members
                                                   -------------                  Managing
                                              Units             Amount             Member             Total
<S>                                             <C>              <C>                  <C>            <C>
Balance December 31, 1999                       7,744,326        $64,130,010               $ -       $ 64,130,010
Capital contributions                           4,266,202         42,662,020                 -         42,662,020
Less selling commissions to affiliates                            (4,052,892)                -         (4,052,892)
Other syndication costs to affiliates                             (1,996,437)                -         (1,996,437)
Distributions to members                                          (6,614,767)         (536,365)        (7,151,132)
Net (loss) income                                                 (2,114,758)          536,365         (1,578,393)
                                        ------------------ ------------------ ----------------- ------------------
Balance September 30, 2000                     12,010,528        $92,013,176               $ -       $ 92,013,176
                                        ================== ================== ================= ==================
</TABLE>

                             See accompanying notes.


                      ATEL CAPITAL EQUIPMENT FUND VIII, LLC

                            STATEMENTS OF CASH FLOWS

                       NINE AND THREE MONTH PERIODS ENDED
                           SEPTEMBER 30, 2000 AND 1999
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                                      Nine Months                          Three Months
                                                                  Ended September 30,                   Ended September 30,
                                                                  -------------------                   -------------------
                                                                2000               1999               2000              1999
                                                                ----               ----               ----              ----
Operating activities:
<S>                                                            <C>                   <C>                <C>               <C>
Net (loss) income                                              $ (1,578,393)         $ 269,983          $ (4,525)         $ 508,554
Adjustments to reconcile net (loss) income to
   cash provided by operating activities:
   Depreciation                                                  16,078,770          2,792,084         5,894,918          1,748,864
   Gain on sales of assets                                           (1,453)                 -                 -                  -
   Changes in operating assets and liabilities:
      Accounts receivable                                        (1,688,343)        (1,966,818)       (1,333,079)          (975,723)
      Other assets                                                   22,500           (150,000)            7,500           (150,000)
      Accounts payable, Managing Member                            (294,612)           128,459           (34,909)           128,459
      Accounts payable, other                                       284,779          1,740,870        (1,043,755)         1,498,035
      Accrued interest payable                                      118,910                  -           (47,369)                 -
      Unearned lease income                                         737,264             41,768           818,548             (7,998)
                                                          ------------------ ------------------ ----------------- ------------------
Net cash provided by operations                                  13,679,422          2,856,346         4,257,329          2,750,191
                                                          ------------------ ------------------ ----------------- ------------------

Investing activities:
Purchases of equipment on operating leases                      (51,934,271)       (49,378,065)      (16,307,225)       (24,739,628)
Purchases of equipment on direct financing leases                (8,322,910)        (9,951,981)       (7,243,757)        (4,610,893)
Proceeds from sales of assets                                         9,520                  -                 -                  -
Reduction of net investment in direct financing leases              553,989            675,100          (345,933)           334,231
Payment of initial direct costs                                    (691,273)           (33,373)         (211,455)                 -
                                                          ------------------ ------------------ ----------------- ------------------
Net cash used in investing activities                           (60,384,945)       (58,688,319)      (24,108,370)       (29,016,290)
                                                          ------------------ ------------------ ----------------- ------------------
</TABLE>




                                       5

<PAGE>

                      ATEL CAPITAL EQUIPMENT FUND VIII, LLC

                            STATEMENTS OF CASH FLOWS
                                   (Continued)

                    STATEMENT OF CHANGES IN MEMBERS' CAPITAL
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                                      Nine Months                          Three Months
                                                                  Ended September 30,                   Ended September 30,
                                                                  -------------------                   -------------------
                                                                2000               1999               2000              1999
                                                                ----               ----               ----              ----
Financing activities:
<S>                                                            <C>                   <C>                <C>               <C>
Capital contributions received                                   42,662,020         60,176,840        12,936,030         19,591,390
Payment of syndication costs to managing member                  (6,049,329)        (8,504,898)       (1,889,790)        (2,691,935)
Borrowings under line of credit                                  21,908,796          8,000,000         1,000,000          8,000,000
Repayments of line of credit                                    (22,816,169)                 -        (5,507,373)                 -
Proceeds of long-term debt                                       27,400,000                  -        19,000,000                  -
Repayments of long-term debt                                     (8,478,000)                 -        (3,555,000)                 -
Repayments of non-recourse debt                                  (2,067,853)                 -          (981,380)                 -
Distributions to managing member                                   (536,365)                 -          (202,487)                 -
Distributions to members                                         (6,614,767)        (1,342,454)       (2,496,936)          (913,033)
                                                          ------------------ ------------------ ----------------- ------------------
Net cash provided by financing activities                        45,408,333         58,329,488        18,303,064         23,986,422
                                                          ------------------ ------------------ ----------------- ------------------
Net (decrease) increase in cash and cash
   equivalents                                                   (1,297,190)         2,497,515        (1,547,977)        (2,279,677)
Cash and cash equivalents at beginning of
   period                                                         3,973,342                600         4,224,129          4,777,792
                                                          ------------------ ------------------ ----------------- ------------------
Cash and cash equivalents at end of period                      $ 2,676,152        $ 2,498,115       $ 2,676,152        $ 2,498,115
                                                          ================== ================== ================= ==================

Supplemental disclosures of cash flow
   information:
Cash paid during the period for interest                        $ 5,208,362          $ 764,541       $ 4,785,780          $ 341,959
                                                          ================== ================== ================= ==================
</TABLE>


                             See accompanying notes.

                                       6

<PAGE>

                      ATEL CAPITAL EQUIPMENT FUND VIII, LLC

                          NOTES TO FINANCIAL STATEMENTS

                               SEPTEMBER 30, 2000
                                   (Unaudited)


1.  Summary of significant accounting policies:

Interim financial statements:

The unaudited interim financial statements reflect all adjustments which are, in
the opinion of the managing  member,  necessary to a fair statement of financial
position and results of operations for the interim periods  presented.  All such
adjustments are of a normal recurring nature.  These unaudited interim financial
statements  should be read in  conjunction  with the most recent  report on Form
10K.


2.  Organization and Company matters:

ATEL Capital Equipment Fund VIII, LLC. (the Company),  was formed under the laws
of the State of  California  on July 31 , 1998,  for the  purpose  of  acquiring
equipment to engage in equipment leasing and sales activities.  Contributions in
the  amount  of $600  were  received  as of  October  7,  1998,  $100  of  which
represented  the Managing  Member's (ATEL  Financial  Corporation's)  continuing
interest, and $500 of which represented the Initial Members' capital investment.

Upon the sale of the  minimum  amount  of Units  of  Limited  Liability  Company
interest  (Units)  of  $1,200,000  and the  receipt of the  proceeds  thereof on
January 13, 1999, the Company commenced operations.

The  Company  does not make a  provision  for income  taxes since all income and
losses will be allocated to the Partners for inclusion in their  individual  tax
returns.


3.  Investment in leases:

The Company's investment in leases consists of the following:

<TABLE>
<CAPTION>
                                                                               Depreciation
                                            Balance                             Expense or         Reclassi-           Balance
                                          December 31,                         Amortization       fications or      September 30,
                                              1999            Additions          of Leases        Dispositions          2000
                                              ----            ---------          ---------        ------------          ----
<S>                                         <C>               <C>                <C>                <C>                <C>
Net investment in operating leases          $129,689,456      $  51,934,271      $ (15,914,655)     $     (8,067)      $165,701,005
Net investment in direct financing
   leases                                      9,040,460          8,322,910           (553,989)                -         16,809,381
Initial direct costs, net of
   accumulated amortization                      690,292            691,273           (164,115)                -          1,217,450
                                        ----------------- ------------------ ------------------ ----------------- ------------------
                                            $139,420,208      $  60,257,181      $ (16,468,644)     $     (8,067)      $183,727,836
                                        ================= ================== ================== ================= ==================
</TABLE>






                                       7
<PAGE>

                      ATEL CAPITAL EQUIPMENT FUND VIII, LLC

                          NOTES TO FINANCIAL STATEMENTS

                               SEPTEMBER 30, 2000
                                   (Unaudited)


3.  Investment in leases (continued):

Operating leases:

Property on operating leases consists of the following:

<TABLE>
<CAPTION>
                                         Balance                                                                    Balance
                                       December 31,    Acquisitions, Dispositions & Reclassifications            September 30,
                                                       ----------------------------------------------
                                           1999        1st Quarter        2nd Quarter          3rd Quarter           2000
                                           ----        -----------        -----------          -----------           ----
<S>                                      <C>                 <C>               <C>              <C>                 <C>
Manufacturing                            $ 25,561,287        $ 2,365,847       $ 12,354,201     $   3,279,604       $ 43,560,939
Transportation, rail                       34,613,356                  -          4,797,067           224,075         39,634,498
Aircraft                                   24,411,837                  -                  -         7,203,037         31,614,874
Containers                                 21,228,750                  -                  -                 -         21,228,750
Transportation, other                      10,247,265                  -          5,932,595         2,146,488         18,326,348
Natural gas compressors                     7,863,922            275,085          5,094,356           582,262         13,815,625
Other                                       4,950,434          2,441,297             20,452         1,562,875          8,975,058
Materials handling                          2,187,570            528,455          1,808,040         1,308,883          5,832,948
Marine vessel                               3,952,500                  -                  -                 -          3,952,500
                                     ----------------- ------------------ ------------------ ----------------- ------------------
                                           135,016,921          5,610,684        30,006,711        16,307,224        186,941,540
Less accumulated depreciation              (5,327,465)        (4,677,684)        (5,403,558)       (5,831,828)       (21,240,535)
                                     ----------------- ------------------ ------------------ ----------------- ------------------
                                         $129,689,456          $ 933,000       $ 24,603,153      $ 10,475,396       $165,701,005
                                     ================= ================== ================== ================= ==================
</TABLE>

Direct financing leases:

As of September 30, 2000,  investment in direct financing leases consists office
automation  equipment.  The  following  lists the  components  of the  Company's
investment in direct financing leases as of September 30, 2000:

Total minimum lease payments receivable                         $ 15,868,612
Estimated residual values of leased equipment (unguaranteed)       4,774,302
                                                            -----------------
Investment in direct financing leases                             20,642,914
Less unearned income                                              (3,833,533)
                                                            -----------------
Net investment in direct financing leases                       $ 16,809,381
                                                            =================

All of the  property  on leases  was  acquired  in 1999 and 2000.  There were no
significant dispositions of such property.





                                       8
<PAGE>

                      ATEL CAPITAL EQUIPMENT FUND VIII, LLC

                          NOTES TO FINANCIAL STATEMENTS

                               SEPTEMBER 30, 2000
                                   (Unaudited)


3.  Investment in leases (continued):

At September 30, 2000,  the aggregate  amounts of future  minimum lease payments
are as follows:

<TABLE>
<CAPTION>
                                                               Direct
                          Year ending      Operating          Financing
                         December 31,       Leases             Leases             Total

<S>                                       <C>               <C>                 <C>
Three months ending December 31, 2000     $    6,879,134    $       822,791     $   7,701,925
        Year ending December 31, 2001         28,649,363          3,543,814        32,193,177
                                 2002         25,648,080          3,021,377        28,669,457
                                 2003         19,630,282          2,714,320        22,344,602
                                 2004         11,642,642          1,903,003        13,545,645
                           Thereafter         21,958,581          3,863,307        25,821,888
                                       ------------------ ------------------ -----------------
                                            $114,408,082      $  15,868,612      $130,276,694
                                       ================== ================== =================
</TABLE>


4.  Non-recourse debt:

At September 30, 2000,  non-recourse debt consists of notes payable to financial
institutions.  The notes are due in varying quarterly and semi-annual  payments.
Interest on the notes is at rates from 7.98% to 14.0%.  The notes are secured by
assignments of lease payments and pledges of assets.  The notes mature from 2001
through 2004.

Future minimum payments of non-recourse debt are as follows:

<TABLE>
<CAPTION>
                          Year ending
                          December 31,        Principal          Interest            Total

<S>                                                     <C>           <C>               <C>
   Three months ending December 31, 2000                $ -           $ 82,704          $ 82,704
           Year ending December 31, 2001          1,006,764            403,662         1,410,426
                                    2002                  -            331,724           331,724
                                    2003             53,814            331,724           385,538
                                    2004          4,046,186             53,814         4,100,000
                                          ------------------ ------------------ -----------------
                                                $ 5,106,764        $ 1,203,628       $ 6,310,392
                                          ================== ================== =================
</TABLE>




                                       9

<PAGE>

                      ATEL CAPITAL EQUIPMENT FUND VIII, LLC

                          NOTES TO FINANCIAL STATEMENTS

                               SEPTEMBER 30, 2000
                                   (Unaudited)


5.  Other long-term debt:

In 1999, the Company entered into a $70 million receivables funding program (the
Program) (which has been increased to $125 million) with a receivables financing
company  that issues  commercial  paper rated A1 by Standard and Poors and P1 by
Moody's Investor Services.  Under the Program, the receivables financing company
receives a general lien against all of the otherwise  unencumbered assets of the
Company. The Program provides for borrowing at a variable interest rate (6.7087%
at September 30, 2000).

The Program  requires the Managing  Member to enter into various  interest  rate
swaps with a financial  institution  (also rated A1/P1) to manage  interest rate
exposure  associated  with  variable  rate  obligations  under  the  Program  by
effectively  converting  the variable rate debt to fixed rates.  As of September
30,  2000,  the Company  receives or pays  interest on a notional  principal  of
$68,151,000, based on the difference between nominal rates ranging from 6.84% to
7.72% and the variable rate under the Program. No actual borrowing or lending is
involved.  The last of the swaps terminates in 2009. The differential to be paid
or received is accrued as interest  rates change and is recognized  currently as
an adjustment to interest expense related to the debt.

Borrowings under the Program are as follows:

                         Original            Balance           Rate on
                          Amount          September 30,     Interest Swap
    Date Borrowed        Borrowed             2002            Agreement
    -------------        --------             ----            ---------
      11/11/1999           $20,000,000        $16,245,000       6.84%
      12/21/1999            20,000,000         18,792,000       7.41%
      12/24/1999            25,000,000         22,079,000       7.44%
      4/17/2000              6,500,000          6,125,000       7.45%
      4/28/2000              1,900,000          1,721,000       7.72%
       8/3/2000             19,000,000         18,634,000       7.50%
                     ------------------ ------------------
                           $92,400,000        $83,596,000
                     ================== ==================

Other  long-term debt borrowings  mature from 2004 through 2009.  Future minimum
principal payments of long-term debt are as follows:

<TABLE>
<CAPTION>
                     Year ending
                     December 31,          Principal          Interest            Total

<S>                                          <C>                <C>               <C>
Three months ending December 31, 2000        $ 4,212,000        $ 1,482,648       $ 5,694,648
        Year ending December 31, 2001         16,570,000          5,199,001        21,769,001
                                 2002         16,799,000          3,989,929        20,788,929
                                 2003         14,693,000          2,834,448        17,527,448
                                 2004          9,959,000          1,921,310        11,880,310
                           Thereafter         21,363,000          2,697,007        24,060,007
                                       ------------------ ------------------ -----------------
                                             $83,596,000        $18,124,343      $101,720,343
                                       ================== ================== =================
</TABLE>


                                       10

<PAGE>

                      ATEL CAPITAL EQUIPMENT FUND VIII, LLC

                          NOTES TO FINANCIAL STATEMENTS

                               SEPTEMBER 30, 2000
                                   (Unaudited)


6.  Related party transactions:

The terms of the Limited Company  Operating  Agreement provide that the Managing
Member  and/or  Affiliates  are entitled to receive  certain fees for  equipment
acquisition, management and resale and for management of the Company.

The Limited Liability  Company Operating  Agreement allows for the reimbursement
of costs incurred by the Managing Member in providing administrative services to
the  Company.  Administrative  services  provided  include  Company  accounting,
investor  relations,  legal counsel and lease and equipment  documentation.  The
Managing Member is not reimbursed for services where it is entitled to receive a
separate  fee as  compensation  for  such  services,  such  as  acquisition  and
management of equipment.  Reimbursable costs incurred by the Managing Member are
allocated to the Company based upon actual time incurred by employees working on
Company  business and an allocation of rent and other costs based on utilization
studies.

Substantially  all  employees of the  Managing  Member  record time  incurred in
performing administrative services on behalf of all of the Companies serviced by
the Managing Member.  The Managing Member believes that the costs reimbursed are
the lower of actual  costs  incurred  on behalf of the Company or the amount the
Company   would  be  required  to  pay   independent   parties  for   comparable
administrative  services in the same geographic location and are reimbursable in
accordance with the Limited Liability Company Operating Agreement.

The  Managing   Member   and/or   Affiliates   earned  fees,   commissions   and
reimbursements, pursuant to the Limited Liability Company Agreement as follows:
<TABLE>
<CAPTION>

                                                                                      2000              1999
                                                                                      ----              ----
<S>                                                                                  <C>                <C>

Selling commissions (equal to 9.5% of the selling price of the Limited Liability
   Company units, deducted from Other Members' capital)                              $ 4,052,892        $ 5,716,800
Reimbursement of other syndication costs to Managing Member                            1,996,437          2,788,098
Asset management fees to Managing Member                                                 973,761            232,387
Administrative costs reimbursed to Managing Member                                       935,437            516,568
                                                                                ----------------- ------------------
                                                                                     $ 7,958,527        $ 9,253,853
                                                                                ================= ==================
</TABLE>


                                       11
<PAGE>

                      ATEL CAPITAL EQUIPMENT FUND VIII, LLC

                          NOTES TO FINANCIAL STATEMENTS

                               SEPTEMBER 30, 2000
                                   (Unaudited)


7. Member's capital:

As of  September  30,  1999,  12,010,528  Units  ($120,105,280)  were issued and
outstanding.  The  Company's  registration  statement  with the  Securities  and
Exchange Commission became effective December 7, 1998. The Company is authorized
to issue up to  15,000,050  Units,  including the 50 Units issued to the initial
members.

The  Company's Net Income,  Net Losses,  and  Distributions  are to be allocated
92.5% to the Members and 7.5% to the Managing Member.


8.  Line of credit:

The Company  participates with the Managing Member and certain of its Affiliates
in  a  $77,500,000   revolving  credit  agreement  with  a  group  of  financial
institutions  which  expires  on  July  28,  2001.  The  agreement  includes  an
acquisition  facility and a warehouse  facility which are used to provide bridge
financing  for  assets  on  leases.  Draws on the  acquisition  facility  by any
individual  borrower  are  secured  only by that  borrower's  assets,  including
equipment and related leases.  Borrowings on the warehouse facility are recourse
jointly to certain of the Affiliates, the Company and the Managing Member.

At September 30, 2000, the Company had  $6,592,627 of borrowings  under the line
of credit.

The credit agreement  includes certain  financial  covenants  applicable to each
borrower.  The Company was  incompliance  with its covenants as of September 30,
2000.


9.  Commitments:

As of September 30, 2000,  the Company had  outstanding  commitments to purchase
lease equipment totaling approximately $23,400,000.




                                       12

<PAGE>

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

Capital Resources and Liquidity

During the first nine months of 2000 and 1999, the Company's primary  activities
were raising  funds  through its  offering of Limited  Liability  Company  Units
(Units) and engaging in equipment  leasing  activities.  Through  September  30,
2000, the Company had received subscriptions for 12,010,528 Units ($120,105,280)
all of which were issued and outstanding.

During  the  funding  period,  the  Company's  primary  source of  liquidity  is
subscription  proceeds from the public  offering of Units.  The liquidity of the
Company will vary in the future, increasing to the extent cash flows from leases
exceed expenses,  and decreasing as lease assets are acquired,  as distributions
are made to the  members  and to the  extent  expenses  exceed  cash  flows from
leases.

As another source of liquidity,  the Company has contractual  obligations with a
diversified  group of lessees for fixed lease terms at fixed rental amounts.  As
the initial lease terms expire the Company will re-lease or sell the  equipment.
The future liquidity  beyond the contractual  minimum rentals will depend on the
Managing Member's success in re-leasing or selling the equipment as it comes off
lease.

The  Partnership  participates  with the  General  Partner  and  certain  of its
affiliates in a $77,500,000  revolving  line of credit with a group of financial
institutions. The line of credit expires on July 28, 2001.

The Company  anticipates  reinvesting  a portion of lease  payments  from assets
owned in new leasing  transactions.  Such reinvestment will occur only after the
payment  of  all  obligations,   including  debt  service  (both  principal  and
interest), the payment of management and acquisition fees to the Managing Member
and providing for cash distributions to the Limited Partners.

The Company currently has available adequate reserves to meet contingencies, but
in the event those  reserves  were found to be  inadequate,  the  Company  would
likely be in a position to borrow  against its  current  portfolio  to meet such
requirements.  The Managing Member envisions no such  requirements for operating
purposes.

No  commitments  of capital  have been or are expected to be made other than for
the acquisition of additional equipment.  Such commitments totaled approximately
$23,400,000 as of September 30, 2000.

If  inflation  in the general  economy  becomes  significant,  it may affect the
Company  inasmuch as the residual  (resale) values and rates on re-leases of the
Company's  leased assets may increase as the costs of similar  assets  increase.
However, the Company's revenues from existing leases would not increase, as such
rates are generally  fixed for the terms of the leases  without  adjustment  for
inflation.

If interest rates increase  significantly,  the lease rates that the Company can
obtain on future leases will be expected to increase as the cost of capital is a
significant  factor in the pricing of lease financing.  Leases already in place,
for the most part, would not be affected by changes in interest rates.


Cash Flows

During the first nine months of 2000 and 1999,  the Company's  primary source of
liquidity was the proceeds of its offering of Units.

Sources of cash flows from operating activities consisted primarily of operating
lease revenues.



                                       13

<PAGE>

Rents from direct financing leases were the only significant source of cash from
investing  activities.  Uses of cash for investing  activities consisted of cash
used to purchase  operating  and direct  financing  lease  assets and payment of
initial direct costs related to lease asset purchases.

The primary  source of cash from  financing  activities  was the proceeds of the
Company's  public  offering  of Units of  Limited  Liability  Company  interest.
Borrowings under the line of credit and proceeds of long-term debt were the only
other  financing  sources of cash.  Financing uses of cash included  payments of
syndication   costs  associated  with  the  offering,   repayment  of  debt  and
distributions  to  the  members.  Repayments  of  debt  have  increased  due  to
borrowings after the third quarter of 1999.


Results of operations

On January  13,  1999,  the Company  commenced  operations.  Operations  in 2000
resulted in a net loss of  $1,578,3933  for the nine month period and $4,525 for
the three month  period.  Operations  in 1999 resulted in net income of $269,983
for the nine month period and $508,554 for the three month period. The Company's
primary  source  of  revenues  is from  operating  leases.  In  future  periods,
operating  leases  are  also  expected  to be the  most  significant  source  of
revenues.  Depreciation  is  related to  operating  lease  assets  and thus,  to
operating  lease  revenues.  It is expected  to  increase  in future  periods as
acquisitions  continue.  Lease rents and depreciation have increased compared to
1999 as a result of acquisitions over the last year.

Asset  management  fees are based on the gross lease  rents of the Company  plus
proceeds from the sales of lease assets. They are limited to certain percentages
of lease rents,  distributions to members and certain other items. As assets are
acquired,  lease rents are collected and  distributions are made to the members,
these fees are expected to increase.  These factors gave rise to the increase in
fees compared to 1999.

Interest  expense  for the first  nine  months of 1999  related  largely  to the
borrowings  under the line of credit  incurred by an  affiliate  of the Managing
Member. It included all amounts related to those  borrowings,  going back as far
as  November  1998  when  the  Managing  Member  started  to  fund  the  related
transactions on behalf of the Company.  All of the revenues and related carrying
costs for these  transactions  were  attributed to the Company in the first nine
months of 1999.

In 2000, interest relates to long-term debt, non-recourse debt and to borrowings
under the line of credit.  The borrowings  have  increased  compared to 1999 and
have caused the increase in interest expense.

Results of operations in 1999 and 2000 are not  comparable  and are not expected
to be  comparable.  Results of operations in future periods are expected to vary
considerably from those of the first nine months of 2000 and 1999 as the Company
continues to acquire significant amounts of lease assets.



                                       14
<PAGE>

                           PART II. OTHER INFORMATION

Item 1.  Legal Proceedings.

         Inapplicable.

Item 2. Changes In Securities.

         Inapplicable.

Item 3. Defaults Upon Senior Securities.

         Inapplicable.

Item 4. Submission Of Matters To A Vote Of Security Holders.

         Inapplicable.


                                       15
<PAGE>

Item 5. Other Information.

Information provided pursuant to ss. 228.701 (Item 701(f))(formerly  included in
Form SR):

(1) Effective date of the offering:  December 7, 1998; File Number: 333-62477
(2) Offering commenced: December 7, 1998
(3) The offering did not terminate before any securities were sold.
(4) The  offering  has  not  been  terminated  prior  to the  sale of all of the
securities.
(5) The managing underwriter is ATEL Securities Corporation.
(6) The  title of the  registered  class of  securities  is  "Units  of  Limited
Liability  Company  interest".  (7)  Aggregate  amount  and  offering  price  of
securities registered and sold as of October 31, 2000.

<TABLE>
<CAPTION>
                                                                                  Aggregate                           Aggregate
                                                                                  price of                            price of
                                                                                  offering                            offering
                                                                Amount             amount             Amount           amount
                                   Title of Security          Registered         registered            sold             sold
                                   -----------------          ----------         ----------            ----             ----

<S>                            <C>                                <C>          <C>                     <C>            <C>
                               Limited Company units              15,000,000   $150,000,000            12,534,463     $125,344,630

(8) Costs incurred for the issuers  account in connection  with the issuance and
distribution of the securities registered for each category listed below:

                                                              Direct or indirect payments to
                                                               directors, officers, general
                                                             partners of the issuer or their
                                                              associates; to persons owning
                                                                ten percent or more of any          Direct or
                                                              class of equity securities of          indirect
                                                             the issuer; and to affiliates of      payments to
                                                              the issuer                              others            Total
                                                              ----------                              ------            -----

                               Underwriting discounts and
                               commissions                               $ -                         $ 11,907,740      $ 11,907,740

                               Other expenses                              -                            5,890,508         5,890,508

                                                           ------------------                    ----------------- -----------------
                               Total expenses                            $ -                         $ 17,798,248      $ 17,798,248
                                                           ==================                    ================= =================

(9) Net offering proceeds to the issuer after the total expenses in item 8:                                            $107,546,382

(10) The amount of net  offering  proceeds  to the  issuer  used for each of the
purposes listed below:

                                                              Direct or indirect payments to
                                                               directors, officers, general
                                                             partners of the issuer or their
                                                              associates; to persons owning
                                                                ten percent or more of any          Direct or
                                                              class of equity securities of          indirect
                                                             the issuer; and to affiliates of      payments to
                                                              the issuer                              others            Total
                                                              ----------                              ------            -----

                               Purchase and installation of
                               machinery and equipment                   $ -                         $106,919,659      $106,919,659

                               Working capital                             -                              626,723           626,723
                                                           ------------------                    ----------------- -----------------
                                                            $                 -                      $107,546,382     $107,546,382
                                                           ==================                    ================= =================
</TABLE>

(11) The use of the proceeds in Item 10 does not represent a material  change in
the uses of proceeds described in the prospectus.



                                       16
<PAGE>

Item 6. Exhibits And Reports On Form 8-K.

                           (a)Documents filed as a part of this report

                           1.  Financial Statements

                               Included in Part I of this report:

                               Balance  Sheets,  September 30, 2000 and December
                               31, 1999.

                               Income  statements  for the nine and three  month
                               periods ended September 30, 2000 and 1999.

                               Statement of changes in partners' capital for the
                               nine month period ended September 30, 2000.

                               Statements  of cash  flows for the nine and three
                               month periods ended September 30, 2000 and 1999.

                               Notes to the Financial Statements

                           2.  Financial Statement Schedules

                               All other schedules for which provision is made
                               in the applicable accounting regulations of the
                               Securities and Exchange Commission are not
                               required under the related instructions or are
                               inapplicable, and therefore have been omitted.

                           (b) Report on Form 8-K

                               None



                                       17
<PAGE>

                                   SIGNATURES


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

Date:
November 9, 2000

                      ATEL CAPITAL EQUIPMENT FUND VIII, LLC
                                  (Registrant)



                                     By: ATEL Financial Corporation
                                         Managing Member of Registrant




                                     By:   /s/ A. J. BATT
                                         -------------------------------------
                                         A. J. Batt
                                         President and Chief Executive Officer
                                         of Managing Member




                                     By:   /s/ DEAN L. CASH
                                         -------------------------------------
                                         Dean L. Cash
                                         Executive Vice President
                                         of Managing Member




                                     By:   /s/ PARITOSH K. CHOKSI
                                         -------------------------------------
                                         Paritosh K. Choksi
                                         Principal financial officer
                                         of registrant




                                     By:   /s/ DONALD E. CARPENTER
                                         -------------------------------------
                                         Donald E. Carpenter
                                         Principal accounting
                                         officer of registrant

                                       18