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                  SECURITIES AND EXCHANGE COMMISSION
                        WASHINGTON, D.C. 20549


                               FORM 10-Q


           Quarterly Report Pursuant to Section 13 or 15(d)
                of the Securities Exchange Act of 1934



     For the quarter ended              Commission File Number
        March 31, 1997                        0-10478


                    DYCO OIL AND GAS PROGRAM 1981-2
                        (A LIMITED PARTNERSHIP)
        (Exact Name of Registrant as specified in its charter)



            Minnesota                       41-1411952  
   (State or other jurisdiction    (I.R.S. Employer Identification
        of incorporation or                   Number)
          organization)




     Samson Plaza, Two West Second Street, Tulsa, Oklahoma  74103
     ------------------------------------------------------------
     (Address of principal executive offices)          (Zip Code)



                         (918) 583-1791
          ----------------------------------------------------
          (Registrant's telephone number, including area code)




Indicate  by check  mark  whether the  registrant  (1) has  filed  all
reports required to be filed by Section 13 or 15(d)  of the Securities
Exchange Act  of 1934  during the  preceding 12  months  (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      
                              ----     ----
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                    PART I.  FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

          DYCO OIL AND GAS PROGRAM 1981-2 LIMITED PARTNERSHIP
                            BALANCE SHEETS
                              (Unaudited)

                                ASSETS
                                         March 31,   December 31,
                                           1997         1996
                                        ----------   ------------

CURRENT ASSETS:
  Cash and cash equivalents               $110,051      $272,066
  Accrued oil and gas sales                 83,737       116,046
                                          --------      --------
     Total current assets                 $193,788      $388,112

NET OIL AND GAS PROPERTIES, utilizing
  the full cost method                     133,424       155,188

DEFERRED CHARGE                             43,273        43,273
                                          --------      --------
                                          $370,485      $586,573
                                          ========      ========

                   LIABILITIES AND PARTNERS' CAPITAL

CURRENT LIABILITIES:
  Accounts payable                        $  8,934      $  9,896
                                          --------      --------
     Total current liabilities            $  8,934      $  9,896

ACCRUED LIABILITY                          123,973       123,973

PARTNERS' CAPITAL:
  General Partner, issued and
   outstanding, 74 units                     2,376         4,527
  Limited Partners, issued and
   outstanding, 6,000 units                235,202       448,177
                                          --------      --------
     Total Partners' capital              $237,578      $452,704
                                          --------      --------
                                          $370,485      $586,573
                                          ========      ========

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

                                  -2-
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          DYCO OIL AND GAS PROGRAM 1981-2 LIMITED PARTNERSHIP
                       STATEMENTS OF OPERATIONS
          FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996
                              (Unaudited)


                                           1997         1996
                                         --------     --------

REVENUES:
  Oil and gas sales                      $172,694     $109,430
  Interest                                  2,824        2,540
                                         --------     --------
                                         $175,518     $111,970

COST AND EXPENSES:
  Oil and gas production                 $ 38,837     $ 27,920
  Depreciation, depletion, and
   amortization of oil and gas
   properties                              22,828       11,206
  General and administrative (Note 2)      25,279       20,507
                                         --------     --------
                                         $ 86,944     $ 59,633
                                         --------     --------

NET INCOME                               $ 88,574     $ 52,337 
                                         ========     ========
GENERAL PARTNER (1%) - net        
  income                                 $    886     $    523 
                                         ========     ========
LIMITED PARTNERS (99%) - net
  income                                 $ 87,688     $ 51,814 
                                         ========     ========
NET INCOME PER UNIT                      $  14.58     $   8.62 
                                         ========     ========
UNITS OUTSTANDING                           6,074        6,074
                                         ========     ========

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

                                  -3-
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          DYCO OIL AND GAS PROGRAM 1981-2 LIMITED PARTNERSHIP
                       STATEMENTS OF CASH FLOWS
          FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996
                              (Unaudited)

                                           1997         1996
                                         ---------    ---------

CASH FLOWS FROM OPERATING ACTIVITIES:
  Net income                             $ 88,574     $ 52,337 
  Adjustments to reconcile net income
   to net cash provided by operating
   activities:
   Depreciation, depletion, and 
     amortization of oil and gas
     properties                            22,828       11,206
   (Increase) decrease in accrued oil
     and gas sales                         32,309    (   3,419)
   Decrease in accounts payable         (     962)   (   1,084)
                                         --------     -------- 
   Net cash provided by operating        
     activities                          $142,749     $ 59,040
                                         --------     --------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Additions to oil and gas properties   ($  1,064)   ($    559)
                                         --------     --------
   Net cash used by investing 
     activities                         ($  1,064)   ($    559)
                                         --------     --------

CASH FLOWS FROM FINANCING ACTIVITIES:
   Cash distributions                   ($303,700)    $    -
                                         --------     --------

   Net cash used by financing
     activities                         ($303,700)    $    -
                                         --------     --------

NET INCREASE (DECREASE) IN CASH AND
  CASH EQUIVALENTS                      ($162,015)    $ 58,481

CASH AND CASH EQUIVALENTS AT 
  BEGINNING OF PERIOD                     272,066      245,084
                                         --------     --------
CASH AND CASH EQUIVALENTS AT
  END OF PERIOD                          $110,051     $303,565
                                         ========     ========

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

                                  -4-
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          DYCO OIL AND GAS PROGRAM 1981-2 LIMITED PARTNERSHIP
                CONDENSED NOTES TO FINANCIAL STATEMENTS
                            MARCH 31, 1997
                              (Unaudited)


1.   ACCOUNTING POLICIES
     -------------------

     The  balance sheet as of March 31, 1997, statements of operations
     for  the  three  months  ended  March  31,  1997  and  1996,  and
     statements of cash  flows for  the three months  ended March  31,
     1997 and 1996  have been prepared  by Dyco Petroleum  Corporation
     ("Dyco"), the general  partner of  the Dyco Oil  and Gas  Program
     1981-2 Limited  Partnership (the  "Program"), without audit.   In
     the  opinion of  management all  adjustments (which  include only
     normal recurring  adjustments) necessary  to  present fairly  the
     financial position at  March 31, 1997, results  of operations for
     the  three months  ended March 31,  1997 and 1996  and changes in
     cash flows for  the three  months ended March  31, 1997 and  1996
     have been made.

     Information  and   footnote  disclosures  normally   included  in
     financial  statements  prepared  in  accordance   with  generally
     accepted accounting principles  have been  condensed or  omitted.
     It  is  suggested  that these  financial  statements  be  read in
     conjunction  with  the  financial  statements  and notes  thereto
     included in the Program's Annual Report on Form 10-K for the year
     ended  December  31, 1996.   The  results  of operations  for the
     period ended March 31, 1997 are not necessarily indicative of the
     results to be expected for the full year.  

     The limited partners' net income  or loss per unit is based  upon
     each $5,000 initial capital contribution.

     OIL AND GAS PROPERTIES
     ----------------------

     Oil  and gas  operations are  accounted for  using the  full cost
     method  of accounting.  All productive  and  non-productive costs
     associated  with the acquisition,  exploration and development of
     oil and gas reserves are capitalized.   The Program's calculation
     of depreciation, depletion,  and amortization includes  estimated
     future expenditures to be  incurred in developing proved reserves
     and   estimated  dismantlement  and  abandonment  costs,  net  of
     estimated salvage values.   In the event the unamortized  cost of
     oil  and gas  properties  being amortized  exceeds the  full cost
     ceiling (as  defined by the Securities  and Exchange Commission),
     the excess is charged to expense in  the period during which such
     excess  occurs.    Sales   and  abandonments  of  properties  are
     accounted for as adjustments of capitalized costs with no gain or
     loss  recognized, unless  such  adjustments  would  significantly
     alter the  relationship between capitalized costs  and proved oil
     and gas reserves.

     The provision  for depreciation,  depletion, and  amortization of
     oil  and gas properties is calculated by dividing the oil and gas
     sales dollars  during the  period by  the estimated future  gross
     income from the oil and gas properties and applying the resulting
     rate to the  net remaining costs of  oil and gas properties  that
     have been capitalized, plus estimated future development costs.

                                  -5-
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2.   TRANSACTIONS WITH RELATED PARTIES
     ---------------------------------

     Under the terms  of the Program's partnership  agreement, Dyco is
     entitled to receive a reimbursement  for all direct expenses  and
     general and administrative,  geological and engineering  expenses
     it incurs  on behalf  of the  Program.  During  the three  months
     ended March 31, 1997  and 1996 such expenses totaled  $25,279 and
     $20,507, respectively, of which $11,988 was  paid each quarter to
     Dyco and its affiliates.  

     Affiliates  of  the  Program  operate certain  of  the  Program's
     properties.   Their  policy  is  to  bill  the  Program  for  all
     customary charges  and cost reimbursements  associated with these
     activities.

                                  -6-
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ITEM 2.   MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
          AND RESULTS OF OPERATIONS


USE OF FORWARD-LOOKING STATEMENTS AND ESTIMATES
-----------------------------------------------

     This   Quarterly   Report   contains    certain   forward-looking
     statements.  The words "anticipate," "believe," "expect," "plan,"
     "intend,"  "estimate," "project,"  "could,"  "may,"  and  similar
     expressions are intended  to identify forward-looking statements.
     Such statements reflect management's  current views with  respect
     to  future  events and  financial  performance.   This  Quarterly
     Report also includes  certain information, which is,  or is based
     upon, estimates and assumptions.   Such estimates and assumptions
     are management's efforts to  accurately reflect the condition and
     operation of the Program.

     Use of forward-looking statements  and estimates and  assumptions
     involve  risks  and  uncertainties  which include,  but  are  not
     limited to, the volatility of oil and gas prices, the uncertainty
     of reserve  information, the  operating risk associated  with oil
     and gas properties (including the risk of personal injury, death,
     property  damage,  damage to  the  well  or producing  reservoir,
     environmental  contamination, and  other  operating  risks),  the
     prospect of  changing tax  and regulatory laws,  the availability
     and capacity  of  processing and  transportation facilities,  the
     general economic climate, the supply and price of foreign imports
     of  oil and gas,  the level of  consumer product demand,  and the
     price  and availability of alternative fuels.  Should one or more
     of  these risks  or uncertainties  occur or  should  estimates or
     underlying  assumptions  prove  incorrect, actual  conditions  or
     results  may vary  materially  and adversely  from those  stated,
     anticipated, believed, estimated, or otherwise indicated.


LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

     Net  proceeds   from  the  Program's  operations  less  necessary
     operating  capital are  distributed to  investors on  a quarterly
     basis.   The net proceeds  from production are  not reinvested in
     productive assets, except to the extent that producing wells  are
     improved or where methods  are employed to permit more  efficient
     recovery  of  the Program's  reserves  which  would result  in  a
     positive economic impact.

     The Program's available capital from subscriptions has been spent
     on oil and  gas drilling  activities.   There should  not be  any
     further material capital resource commitments in the future.  The
     Program has  no  bank debt  commitments.   Cash  for  operational
     purposes will be provided by current oil and gas production.

RESULTS OF OPERATIONS
---------------------

     GENERAL DISCUSSION

     The following  general discussion  should be read  in conjunction
     with the analysis of  results of operations provided below.   The
     most important  variable affecting the Program's  revenues is the

                                  -7-
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     prices received  for the sale of oil  and gas.  Predicting future
     prices is very difficult.  Substantially all of the Program's gas
     reserves are being sold in the "spot market".  Prices on the spot
     market  are  subject  to   wide  seasonal  and  regional  pricing
     fluctuations due  to the  highly competitive  nature of  the spot
     market.  In addition, such spot market sales are generally short-
     term  in   nature  and  are  dependent  upon   the  obtaining  of
     transportation  services provided  by  pipelines.   Management is
     unable  to predict  whether future  oil and  gas prices  will (i)
     stabilize, (ii) increase, or (iii) decrease.

     THREE MONTHS ENDED MARCH 31, 1997 AS COMPARED TO THE THREE MONTHS
     ENDED MARCH 31, 1996.
                                       Three months ended March 31,
                                       ----------------------------
                                          1997             1996
                                        --------         -------
      Oil and gas sales                 $172,694         $109,430
      Oil and gas production expenses   $ 38,837         $ 27,920
      Barrels produced                       354              300
      Mcf produced                        64,056           61,510
      Average price/Bbl                 $  19.78         $  16.79
      Average price/Mcf                 $   2.59         $   1.70
 
     As shown in  the table above, total  oil and gas  sales increased
     $63,264  (57.8%) for  the three  months ended  March 31,  1997 as
     compared  to  the three  months ended  March 31,  1996.   Of this
     increase,  approximately $57,000  and $4,000,  respectively, were
     related  to increases  in the  average price  and volumes  of gas
     sold.  Volumes of oil and gas sold increased 54 barrels and 2,546
     Mcf, respectively, for the  three months ended March 31,  1997 as
     compared to the  three months ended March 31, 1996.   Average oil
     and gas prices increased to $19.78 per barrel  and $2.59 per Mcf,
     respectively, for  the three  months  ended March  31, 1997  from
     $16.79  per barrel and $1.70 per Mcf, respectively, for the three
     months ended March 31, 1996.  

     Oil  and  gas  production  expenses  (including  lease  operating
     expenses and production taxes)  increased $10,917 (39.1%) for the
     three months ended March 31, 1997 as compared to the three months
     ended  March 31, 1996.  This increase resulted primarily from (i)
     an increase  in general repair and  maintenance expenses incurred
     on three  wells during the three  months ended March 31,  1997 as
     compared  to the three  months ended March  31, 1996  and (ii) an
     increase in production taxes associated  with the increase in oil
     and gas  sales discussed above.   As a percentage of  oil and gas
     sales, these  expenses decreased to  22.5% for  the three  months
     ended March 31, 1997 from 25.5%  for the three months ended March
     31,  1996.   This percentage  decrease was  primarily due  to the
     increases in  the average prices  of oil and gas  sold during the
     three months ended March 31, 1997 as compared to the three months
     ended March 31, 1996. 

     Depreciation,  depletion,  and  amortization   of  oil  and   gas
     properties increased $11,622 (103.7%)  for the three months ended
     March 31, 1997  as compared to  the three months ended  March 31,
     1996.   This increase resulted  primarily from a  decrease in the
     gas price used  in the valuation of  reserves at March  31, 1997.
     As a percentage  of oil and gas sales, this  expense increased to
     13.2% for the  three months ended March  31, 1997 from 10.2%  for
     the  three months ended March 31, 1996.  This percentage increase

                                  -8-
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     was  primarily  due  to  the  dollar  increase  in  depreciation,
     depletion, and amortization discussed  above, partially offset by
     the increases in  the average prices of  oil and gas  sold during
     the three  months ended March 31,  1997 as compared to  the three
     months ended March 31, 1996. 

     General and administrative expenses  increased $4,772 (23.3%) for
     the three  months ended March 31,  1997 as compared  to the three
     months ended  March 31, 1996.   This increase  resulted primarily
     from an increase  in professional  fees during  the three  months
     ended March 31, 1997 as compared to the  three months ended March
     31, 1996.  As a  percentage of oil and gas sales,  these expenses
     decreased to 14.6% for the three months ended March 31, 1997 from
     18.7% for the three months ended March 31, 1996.  This percentage
     decrease was primarily  due to the increase in oil  and gas sales
     during the three months  ended March 31, 1997 as compared  to the
     three months ended March 31, 1996 discussed above.   

                                  -9-
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                      PART II:  OTHER INFORMATION


ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

     (a)  Exhibits

          27.1      Financial   Data   Schedule   containing   summary
                    financial information extracted from the  Dyco Oil
                    and  Gas  Program  1981-2   Limited  Partnership's
                    financial statements as of  March 31, 1997 and for
                    the  three months  ended  March  31,  1997,  filed
                    herewith.

                    All other exhibits are omitted as inapplicable.

     (b)  Reports on Form 8-K for the first quarter of 1997.

          Date of Event:                January 24, 1997
          Date filed with SEC:          January 24, 1997
          Item Included:
               Item 5 - Other Events

                                 -10-
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                              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.


                         DYCO OIL AND GAS PROGRAM 1981-2 LIMITED
                         PARTNERSHIP

                              (Registrant)


                              By:  DYCO PETROLEUM CORPORATION

                                   General Partner




Date:  May 5, 1997           By:        /s/Dennis R. Neill
                                 -----------------------------
                                        (Signature)
                                        Dennis R. Neill
                                        President



Date:  May 5, 1997           By:        /s/Patrick M. Hall
                                 -----------------------------
                                        (Signature)
                                        Patrick M. Hall
                                        Chief Financial Officer

                                -11-
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                           INDEX TO EXHIBITS


NUMBER    DESCRIPTION
------    -----------

27.1      Financial   Data   Schedule  containing   summary  financial
          information  extracted from  the  Dyco Oil  and Gas  Program
          1981-2  Limited  Partnership's  financial  statements  as of
          March  31, 1997  and for  the three  months ended  March 31,
          1997, filed herewith.

          All other exhibits are omitted as inapplicable.
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