UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

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

For the period ended June 30, 1998
                     -------------

                                       or

[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 [No Fee Required]

For the transition period from               to 
                              ---------------  ---------------     

Commission File Number 0-11186
                       -------

                                PS PARTNERS, LTD.
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)




             California                                   95-3729108
------------------------------------------      ------------------------------
    (State or other jurisdiction of                   (I.R.S. Employer 
     incorporation or organization)                 Identification Number)


          701 Western Avenue
         Glendale, California                             91201-2394
------------------------------------------      ------------------------------
(Address of principal executive offices)                  (Zip Code)

Registrant's telephone number, including area code:  (818) 244-8080
                                                     --------------




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
                                       ---  ---


<PAGE>


                                      INDEX



PART I.   FINANCIAL INFORMATION

Condensed consolidated balance sheets at June 30, 1998
      and December 31, 1997                                                 2

Condensed consolidated statements of income for the three
     and six months ended June 30, 1998 and 1997                            3

Condensed consolidated statements of cash flows for the
     six months ended June 30, 1998 and 1997                              4-5

Notes to condensed consolidated financial statements                        6

Management's discussion and analysis of financial condition
     and results of operations                                            7-9

PART II.  OTHER INFORMATION

(Items 1 through 5 are not applicable)

Item 6 - Exhibits and Reports on Form 8-K                                  10

Item 7 - Financial Statements and Exhibits                                 10


<PAGE>


                                PS PARTNERS, LTD.
                      CONDENSED CONSOLIDATED BALANCE SHEETS


<TABLE>
<CAPTION>
                                                                                 June 30,          December 31,
                                                                                   1998                1997
                                                                              -----------------------------------
                                                                                (Unaudited)
                                     ASSETS


     <S>                                                                        <C>                 <C>     
     Cash and cash equivalents                                                   $1,346,000            $819,000

     Rent and other receivables                                                     141,000              65,000

     Real estate facilities, at cost:
        Land                                                                     10,660,000          10,660,000
        Buildings and equipment                                                  45,128,000          44,834,000
                                                                              -----------------------------------
                                                                                 55,788,000          55,494,000

        Less accumulated depreciation                                           (26,582,000)        (25,402,000)
                                                                              -----------------------------------
                                                                                 29,206,000          30,092,000

     Investment in real estate entity                                             2,841,000           2,830,000

     Other assets                                                                   190,000             136,000
                                                                              -----------------------------------

                                                                                $33,724,000         $33,942,000
                                                                              ===================================


                        LIABILITIES AND PARTNERS' EQUITY


     Accounts payable                                                              $744,000            $686,000

     Advance payments from renters                                                  438,000             374,000

     Minority interest in general partnerships                                   19,212,000          19,727,000

     Partners' equity:
        Limited partners' equity, $500 per unit, 66,000
           units authorized, issued and outstanding                              13,153,000          12,980,000
        General partner's equity                                                    177,000             175,000
                                                                              -----------------------------------

              Total partners' equity                                             13,330,000          13,155,000
                                                                              -----------------------------------

                                                                                $33,724,000         $33,942,000
                                                                              ===================================
</TABLE>
                            See accompanying notes.
                                       2


<PAGE>


                                PS PARTNERS, LTD.
                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                                                Three Months Ended                 Six Months Ended
                                                                     June 30,                          June 30,
                                                        -------------------------------------------------------------------
                                                                1998            1997             1998             1997
                                                        -------------------------------------------------------------------

         REVENUE:

         <S>                                                <C>              <C>             <C>               <C>       
         Rental income                                      $3,053,000       $2,787,000      $5,927,000        $5,475,000
         Equity in income of real estate entity                 64,000           55,000         118,000            93,000
         Interest income                                        16,000            7,000          28,000            14,000
                                                        -------------------------------------------------------------------
                                                             3,133,000        2,849,000       6,073,000         5,582,000
                                                        -------------------------------------------------------------------

         COSTS AND EXPENSES:

         Cost of operations                                    911,000          867,000       1,815,000         1,790,000
         Management fees                                       185,000          167,000         357,000           328,000
         Depreciation and amortization                         589,000          584,000       1,180,000         1,161,000
         Administrative                                         31,000           28,000          48,000            44,000
                                                        -------------------------------------------------------------------
                                                             1,716,000        1,646,000       3,400,000         3,323,000
                                                        -------------------------------------------------------------------

         Income before minority interest                     1,417,000        1,203,000       2,673,000         2,259,000

         Minority interest in income                          (484,000)        (434,000)       (898,000)         (805,000)
                                                        -------------------------------------------------------------------

         NET INCOME                                           $933,000         $769,000      $1,775,000        $1,454,000
                                                        ===================================================================

         Limited partners' share of net income
             ($24.23 per unit in 1998 and
             $19.41 per unit in 1997)                                                        $1,599,000        $1,281,000
         General partner's share of net income                                                  176,000           173,000
                                                                                         ----------------------------------

                                                                                             $1,775,000        $1,454,000
                                                                                         ==================================
</TABLE>
                            See accompanying notes.
                                       3


<PAGE>


                                PS PARTNERS, LTD.
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                                                                                  Six Months Ended
                                                                                                      June 30,
                                                                                       ---------------------------------------
                                                                                                 1998               1997
                                                                                       ---------------------------------------

         CASH FLOWS FROM OPERATING ACTIVITIES:

            <S>                                                                               <C>                <C>       
            Net income                                                                        $1,775,000         $1,454,000

            Adjustments to reconcile net income to net cash
                provided by operating activities

                Depreciation and amortization                                                  1,180,000          1,161,000
                (Increase) decrease in rent and other receivables                                (76,000)            26,000
                (Increase) decrease in other assets                                              (54,000)            64,000
                Increase (decrease) in accounts payable                                           58,000             (3,000)
                Increase in advance payments from renters                                         64,000             28,000
                Equity in income of real estate entity                                          (118,000)           (93,000)
                Minority interest in income                                                      898,000            805,000
                                                                                       ---------------------------------------

                  Total adjustments                                                            1,952,000          1,988,000
                                                                                       ---------------------------------------

                  Net cash provided by operating activities                                    3,727,000          3,442,000
                                                                                       ---------------------------------------

         CASH FLOWS FROM INVESTING ACTIVITIES:

            Distributions from real estate entity                                                107,000                  -
            Investment in real estate entity                                                           -             (3,000)
            Additions to real estate facilities                                                 (294,000)          (615,000)
                                                                                       ---------------------------------------

                  Net cash used in investing activities                                         (187,000)          (618,000)
                                                                                       ---------------------------------------

         CASH FLOWS FROM FINANCING ACTIVITIES:

            Distributions to holder of minority interest                                      (1,413,000)        (1,230,000)
            Distributions to partners                                                         (1,600,000)        (1,600,000)
                                                                                       ---------------------------------------

                  Net cash used in financing activities                                       (3,013,000)        (2,830,000)
                                                                                       ---------------------------------------

         Net increase (decrease) in cash and cash equivalents                                    527,000             (6,000)

         Cash and cash equivalents at the beginning of the period                                819,000            506,000
                                                                                       ---------------------------------------

         Cash and cash equivalents at the end of the period                                   $1,346,000           $500,000
                                                                                       =======================================
</TABLE>
                            See accompanying notes.
                                       4


<PAGE>


                                PS PARTNERS, LTD.
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)
                                   (Continued)


<TABLE>
<CAPTION>
                                                                                                  Six Months Ended
                                                                                                      June 30,
                                                                                       ---------------------------------------
                                                                                              1998                1997
                                                                                       ---------------------------------------


         Supplemental schedule of noncash investing and financing activities:


            <S>                                                                                <C>            <C>         
            Investment in real estate entity                                                   $-             $(2,725,000)

            Transfer of real estate facilities for interest in real estate entity, net          -               2,725,000

</TABLE>
                            See accompanying notes.
                                       5


<PAGE>


                                PS PARTNERS, LTD.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                  JUNE 30, 1998
                                   (UNAUDITED)


1.   The accompanying unaudited condensed consolidated financial statements have
     been prepared  pursuant to the rules and  regulations of the Securities and
     Exchange Commission.  Certain information 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   management  believes  that  the
     disclosures contained herein are adequate to make the information presented
     not misleading. These unaudited condensed consolidated financial statements
     should be read in  conjunction  with the financial  statements  and related
     notes appearing in the Partnership's  Form 10-K for the year ended December
     31, 1997.


2.   In  the  opinion  of  management,   the  accompanying  unaudited  condensed
     consolidated  financial  statements reflect all adjustments,  consisting of
     only  normal  accruals,  necessary  to  present  fairly  the  Partnership's
     financial  position at June 30,  1998,  the results of  operations  for the
     three and six months  ended  June 30,  1998 and 1997 and cash flows for the
     six months then ended.


3.   The results of operations  for the three and six months ended June 30, 1998
     are not  necessarily  indicative of the results to be expected for the full
     year.


                                       6
<PAGE>


                                PS PARTNERS, LTD.
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS


Results of Operations:
----------------------

THREE MONTHS ENDED JUNE 30, 1998 COMPARED TO THREE MONTHS ENDED JUNE 30, 1997:

     The Partnership's net income was $933,000 and $769,000 for the three months
ended  June  30,  1998 and  1997,  respectively,  representing  an  increase  of
$164,000,  or 21%.  The increase  was  primarily  due to an increase in property
operations at the Partnership's real estate facilities,  combined with increased
interest income,  partially offset by increased  minority interest in income for
those properties held jointly with PSI.

     Rental  income  for  the   Partnership's   mini-warehouse   operations  was
$3,005,000  compared to $2,740,000  for the three months ended June 30, 1998 and
1997,  respectively,  representing an increase of $265,000, or 10%. The increase
in rental  income was  primarily  attributable  to  increased  rental  rates and
occupancy  rates.  The  monthly  average  realized  rent per square foot for the
mini-warehouse  facilities  was $.67 compared to $.63 for the three months ended
June 30, 1998 and 1997,  respectively.  The weighted average occupancy levels at
the mini-warehouse facilities was 93% compared to 90% for the three months ended
June 30, 1998 and 1997,  respectively.  Cost of operations (including management
fees) for the  mini-warehouses  increased  $63,000,  or 6%, to  $1,075,000  from
$1,012,000 for the three months ended June 30, 1998 and 1997, respectively.  The
increase in cost of  operations  was  primarily  attributable  to  increases  in
property tax,  repairs and  maintenance,  and  advertising  and  promotion  (due
primarily  to  the  PSI  national  telephone   reservations   center)  expenses.
Accordingly,  for the  Partnership's  mini-warehouse  operations,  property  net
operating income increased  $202,000,  or 12%, from $1,728,000 to $1,930,000 for
the three months ended June 30, 1997 and 1998, respectively.

     Rental income for the  Partnership's  business-park  operations was $48,000
compared  to $47,000  for the three  months  ended June 30,  1998 and 1997.  The
monthly  average  realized rent per square foot for the  Partnership's  business
park facility was $.76 compared to $.71 for the three months ended June 30, 1998
and 1997, respectively. The weighted average occupancy level was 87% compared to
89% for the three  months  ended June 30, 1998 and 1997,  respectively.  Cost of
operations  (including  management  fees) for the  business  park  decreased  to
$21,000  from  $22,000  for the  three  months  ended  June 30,  1998 and  1997,
respectively.   Accordingly,  for  the  Partnership's  business  park  facility,
property net operating income increased  $2,000,  or 8%, from $25,000 to $27,000
for the three months ended June 30, 1997 and 1998, respectively.

     Interest income increased  $9,000,  or 123%, from $7,000 to $16,000 for the
three  months  ended June 30, 1997 and 1998,  respectively.  This  increase  was
primarily attributable to increased average invested cash balances.


                                       7
<PAGE>


      Minority  interest in income increased  $50,000,  or 12%, to $484,000 from
$434,000 for the three months ended June 30, 1998 and 1997,  respectively.  This
increase  was  primarily  attributable  to an  increase  in  operations  at  the
Partnership's real estate facilities owned jointly with PSI.

SIX MONTHS ENDED JUNE 30, 1998 COMPARED TO SIX MONTHS ENDED JUNE 30, 1997:

     The  Partnership's  net income was  $1,775,000  and  $1,454,000 for the six
months ended June 30, 1998 and 1997,  respectively,  representing an increase of
$321,000,  or 22%.  The increase  was  primarily  due to an increase in property
operations at the Partnership's real estate facilities,  combined with increased
interest income,  partially offset by increased  minority interest in income for
those properties held jointly with PSI.

     Rental  income  for  the   Partnership's   mini-warehouse   operations  was
$5,828,000  compared to  $5,381,000  for the six months  ended June 30, 1998 and
1997, respectively, representing an increase of $447,000, or 8%. The increase in
rental income was primarily  attributable  to increased  rental rates,  combined
with increased average  occupancy levels.  The monthly average realized rent per
square foot for the mini-warehouse  facilities was $.65 compared to $.62 for the
six months  ended June 30, 1998 and 1997,  respectively.  The  weighted  average
occupancy levels at the  mini-warehouse  facilities were 92% and 88% for the six
months ended June 30, 1998 and 1997, respectively. Cost of operations (including
management fees) for the mini-warehouses increased $60,000, or 3%, to $2,128,000
from  $2,068,000 for the six months ended June 30, 1998 and 1997,  respectively.
The increase in cost of operations  was primarily  attributable  to increases in
property tax and  advertising  and promotion  (due primarily to the PSI national
telephone  reservations  center)  expenses.  Accordingly,  for the Partnership's
mini-warehouse operations,  property net operating income increased $387,000, or
12%, from  $3,313,000  to $3,700,000  for the six months ended June 30, 1997 and
1998, respectively.

     Rental income for the  Partnership's  business-park  operations was $99,000
compared  to  $94,000  for  the  six  months  ended  June  30,  1998  and  1997,
respectively,  representing an increase of $5,000, or 5%. The increase in rental
income was primarily  attributable  to an increase in rental rates.  The monthly
average  realized  rent per square  foot was $.75  compared  to $.70 for the six
months  ended  June 30,  1998  and  1997,  respectively.  The  weighted  average
occupancy  level  remained  stable at 90% for the six months ended June 30, 1998
and 1997. Cost of operations  (including  management fees) for the business park
decreased  $6,000, or 12%, to $44,000 from $50,000 for the six months ended June
30,  1998  and  1997,  respectively.  The  decrease  in cost of  operations  was
primarily  attributable  to a  decrease  in  repairs  and  maintenance  expense.
Accordingly,   for  the  Partnership's  business  park  facility,  property  net
operating income  increased by $11,000,  or 25%, from $44,000 to $55,000 for the
six months ended June 30, 1997 and 1998, respectively.


                                       8
<PAGE>


     Interest income increased $14,000, or 100%, from $14,000 to $28,000 for the
six  months  ended  June 30,  1997 and 1998,  respectively.  This  increase  was
primarily attributable to increased average invested cash balances.

     Minority  interest in income  increased  $93,000,  or 12%, to $898,000 from
$805,000  for the six months  ended June 30, 1998 and 1997,  respectively.  This
increase  was  primarily  attributable  to an  increase  in  operations  at  the
Partnership's real estate facilities owned jointly with PSI.

Liquidity and Capital Resources
-------------------------------

     The  Partnership  has adequate  sources of cash to finance its  operations,
both on a short-term and long-term  basis,  primarily from internally  generated
cash from property operations and cash reserves.  Cash generated from operations
($3,727,000  for the six months ended June 30, 1998) has been sufficient to meet
all current obligations of the Partnership.

     During 1998, the Partnership anticipates  approximately $867,000 of capital
improvements  (of which $369,000  represents  PSI's joint venture share).  Total
capital  improvements  were  $294,000  for the six months ended June 30, 1998 of
which $166,000 represents the Partnership's share.

     The  Partnership  paid  distributions  to the limited and general  partners
totaling  $1,426,000  ($21.60 per unit) and $174,000,  respectively,  during the
first six months of 1998.  Future  distribution  rates may be adjusted to levels
which are supported by operating  cash flow after capital  improvements  and any
other obligations.


                                       9
<PAGE>


                           PART II. OTHER INFORMATION

Items 1 through 4 are not applicable.

Item 5 Other Events
       ------------

     The Partnership has entered into an Agreement and Plan of Reorganization by
and among PSI, PS Partners  Merger Co.,  Inc. and the  Partnership,  dated as of
July 14, 1998 (the "Agreement and Plan of Reorganization").  Under the Agreement
and Plan of  Reorganization,  each of the  Partnership  units held by the public
limited  partners will be converted into the right to receive a value of $713 in
PSI common stock or, at the limited partner's  election,  in cash. The Agreement
and Plan of Reorganization is referenced as Exhibit 2 hereto and is incorporated
herein by this reference.

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

     (a) The following Exhibits are included herein:

          (27) Financial Data Schedule

     (b) Form 8-K

          None

Item 7 Financial Statements and Exhibits
       ---------------------------------

     (c) Exhibits.

          (2) Agreement and Plan of  Reorganization by and among Public Storage,
Inc., PS Partners  Merger Co., Inc. and PS Partners,  Ltd.  Dated as of July 14,
1998.  Filed with the  Partnership's  Current  Report on Form 8-K dated July 14,
1998 and incorporated herein by reference.


                                   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.

                          DATED:  August 13, 1998

                                  PS PARTNERS, LTD.

                          BY:     Public Storage, Inc.
                                  General Partner

                          BY:     /s/ John Reyes
                                  -----------------------------------------
                                  John Reyes
                                  Senior Vice President and Chief Financial
                                    Officer of Public Storage, Inc.
                                    (principal financial and accounting
                                    officer)


                                       10