FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                   (Mark One)

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

                  For the quarterly period ended June 30, 2003

                                       OR

     |_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934

             For the transition period from ________ to ___________

                         Commission file number: 0-21494


                      WNC HOUSING TAX CREDIT FUND III, L.P.

                        California                                33-0463432
                      (State or other jurisdiction of          (I.R.S. Employer
                     incorporation or organization)          Identification No.)



              3158 Redhill Avenue, Suite 120, Costa Mesa, CA 92626

                                 (714) 622-5565


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
 ---------     ----------

Indicate by check mark whether the registrant is an accelerated filer (as
defined in rule 12b-2 of the Exchange Act).

Yes           No      X
 ---------    -----------




<PAGE>


                      WNC HOUSING TAX CREDIT FUND III, L.P.
                       (A California Limited Partnership)

                               INDEX TO FORM 10-Q

                  For the Quarterly Period Ended June 30, 2003




PART I. FINANCIAL INFORMATION

     Item 1. Financial Statements

             Balance Sheets,
              June 30, 2003 and March 31, 2003.................................3

             Statements of Operations
              For the three months ended June 30, 2003 and 2002................4

             Statement of Partners' Deficit
              For the three months ended June 30, 2003 ........................5

             Statements of Cash Flows
              For the three months ended June 30, 2003 and 2002................6

             Notes to Financial Statements.....................................7


     Item 2. Management's Discussion and Analysis of Financial
             Condition and Results of Operations..............................14

     Item 3. Quantitative and Qualitative Disclosures about Market Risk.......15

     Item 4.  Procedures and Controls.........................................15

PART II. OTHER INFORMATION

     Item 1. Legal Proceedings................................................16

     Item 6. Exhibits and Reports on Form 8-K.................................16

     Signatures...............................................................17

     Certifications...........................................................18



                                       2
<PAGE>


                      WNC HOUSING TAX CREDIT FUND III, L.P.
                       (A California Limited Partnership)

                                 BALANCE SHEETS
<TABLE>
<CAPTION>




                                                                       June 30, 2003               March 31, 2003
                                                                   -----------------------        ------------------
                                                                        (unaudited)
<S>                                                              <C>                            <C>
ASSETS

Cash and cash equivalents                                        $               250,795        $         251,056
Investments in limited partnerships, net (Note 2)                              1,304,692                1,358,412
                                                                   -----------------------        ------------------

                                                                 $             1,555,487        $       1,609,468
                                                                   =======================        ==================


LIABILITIES AND PARTNERS' DEFICIT

Liabilities:
   Accrued fees and expenses due to
     General Partner and affiliates (Note 3)                                   2,469,939                2,392,085
                                                                   -----------------------        ------------------

      Total liabilities                                                        2,469,939                2,392,085
                                                                   -----------------------        ------------------

Commitments and contingencies

Partners' deficit:
  General Partner                                                                (49,665)                 (48,347)
  Limited Partners (15,000 units authorized and 15,000
    units issued and outstanding)                                               (864,787)                (734,270)
                                                                   -----------------------        ------------------

      Total partners' deficit                                                   (914,452)                (782,617)
                                                                   -----------------------        ------------------

                                                                 $             1,555,487        $       1,609,468
                                                                    =======================        ==================
</TABLE>


                See accompanying notes to financial statements

                                       3
<PAGE>



                      WNC HOUSING TAX CREDIT FUND III, L.P.
                       (A California Limited Partnership)

                            STATEMENTS OF OPERATIONS

                For the Three months Ended June 30, 2003 and 2002
                                   (unaudited)
<TABLE>
<CAPTION>


                                                          2003                             2002
                                                      Three months                     Three months
                                                 ------------------------        --------------------------

<S>                                            <C>                             <C>
Interest income                                $                    645       $                     1,178
Distribution income                                               6,594                                 -
                                                 ------------------------        --------------------------

                                                                  7,239                             1,178
                                                 ------------------------        --------------------------

Operating expenses:
  Amortization (Note 2)                                           7,235                             7,235
  Asset management fees (Note 3)                                 74,866                            74,757
  Legal and accounting                                            3,570                             5,975
  Other                                                           6,918                             3,197
                                                 ------------------------        --------------------------

    Total operating expenses                                     92,589                            91,164
                                                 ------------------------        --------------------------

Loss from operations                                            (85,350)                          (89,986)

Equity in losses of
 limited partnerships (Note 2)                                  (46,485)                          (68,505)
                                                 ------------------------        --------------------------

Net loss                                       $               (131,835)       $                 (158,491)
                                                 ========================        ==========================

Net loss allocated to:
  General Partner                              $                 (1,318)       $                   (1,585)
                                                 ========================        ==========================

  Limited Partners                             $               (130,517)       $                 (156,906)
                                                 ========================        ==========================

Net loss per limited
  partner unit                                 $                     (9)       $                      (10)
                                                 ========================        ==========================

Outstanding weighted limited
  partner units                                                  15,000                            15,000
                                                 ========================        ==========================
</TABLE>

                 See accompanying notes to financial statements

                                        4


<PAGE>


                      WNC HOUSING TAX CREDIT FUND III, L.P.
                       (A California Limited Partnership)

                         STATEMENT OF PARTNERS' DEFICIT

                    For the Three months Ended June 30, 2003
                                   (unaudited)
<TABLE>
<CAPTION>


                                                          General               Limited
                                                          Partner              Partners                 Total
                                                       ---------------      ----------------      ------------------

<S>                        <C> <C>                   <C>                  <C>                   <C>
Partners' deficit at March 31, 2003                  $       (48,347)     $       (734,270)     $         (782,617)

Net loss                                                      (1,318)             (130,517)               (131,835)
                                                       ---------------      ----------------      ------------------

Partners' deficit at June 30, 2003                   $       (49,665)     $       (864,787)     $         (914,452)
                                                       ===============      ================      ==================
</TABLE>



                 See accompanying notes to financial statements

                                        5

<PAGE>


                      WNC HOUSING TAX CREDIT FUND III, L.P.
                       (A California Limited Partnership)

                            STATEMENTS OF CASH FLOWS

                For the Three months Ended June 30, 2003 and 2002
                                   (unaudited)
<TABLE>
<CAPTION>


                                                                            2003                 2002
                                                                        --------------      ---------------
<S>                                                                   <C>                 <C>
Cash flows from operating activities:
  Net loss                                                            $     (131,835)     $      (158,491)
    Adjustments to reconcile net loss to net
      cash used in operating activities:
        Amortization                                                           7,235                7,235
        Equity in losses of limited partnerships                              46,485               68,505
        Change in accrued  fees and expenses due to
           General Partner and affiliates                                     77,854               63,799
                                                                        --------------      ---------------

Net cash used in operating activities                                           (261)             (18,952)
                                                                        --------------      ---------------

Cash flows from investing activities:
    Distributions from limited partnerships                                        -                6,869
                                                                        --------------      ---------------

Net cash provided by investing activities                                          -                6,869
                                                                        --------------      ---------------

Net decrease in cash and cash equivalents                                       (261)             (12,083)

Cash and cash equivalents, beginning of period                               251,056              294,946
                                                                        --------------      ---------------

Cash and cash equivalents, end of period                              $      250,795      $       282,863
                                                                        ==============      ===============

SUPPLEMENTAL DISCLOSURE OF CASH FLOW
   INFORMATION:

   Taxes paid                                                         $            -      $           800
                                                                        ==============      ===============
</TABLE>
                 See accompanying notes to financial statements

                                       6
<PAGE>


                      WNC HOUSING TAX CREDIT FUND III, L.P.
                       (A California Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS
                  For the Quarterly Period Ended June 30, 2003
                                   (unaudited)



NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
---------------------------------------------------

General
-------

The accompanying  condensed unaudited financial statements have been prepared in
accordance with accounting principles generally accepted in the United States of
America for interim financial information and with the instructions to Form 10-Q
for quarterly  reports under Section 13 or 15(d) of the Securities  Exchange Act
of 1934.  Accordingly,  they do not include all of the information and footnotes
required by  accounting  principles  generally  accepted in the United States of
America for complete  financial  statements.  In the opinion of management,  all
adjustments (consisting of normal recurring accruals) considered necessary for a
fair  presentation  have been included.  Operating  results for the three months
ended June 30, 2003 are not  necessarily  indicative  of the results that may be
expected  for the fiscal year ending March 31,  2004.  For further  information,
refer  to  the  financial  statements  and  footnotes  thereto  included  in the
Partnership's  annual  report on Form 10-K for the fiscal  year ended  March 31,
2003.

Organization
------------

WNC Housing Tax Credit Fund III,  L.P., a California  Limited  Partnership  (the
"Partnership"),  was  formed  on May 10,  1991  under  the laws of the  State of
California.  The  Partnership  was formed to invest  primarily in other  limited
partnerships   (the  "Local  Limited   Partnerships")   which  own  and  operate
multi-family  housing  complexes  (the "Housing  Complex") that are eligible for
low-income  housing  credits.  The local general  partners  (the "Local  General
Partners")  of  each  Local  Limited   Partnership  retain   responsibility  for
maintaining, operating and managing the Housing Complex.

The general  partner of the  Partnership is WNC Tax Credit  Partners,  L.P. (the
"General Partner"). WNC & Associates, Inc. ("Associates") and Wilfred N. Cooper,
Sr. are the general partners of the General Partner.  The chairman and president
own substantially  all of the outstanding  stock of Associates.  The business of
the Partnership is conducted primarily through Associates as the General Partner
and the Partnership has no employees of their own.

The Partnership  shall continue in full force and effect until December 31, 2050
unless  terminated prior to that date pursuant to the partnership  agreement and
law.

The  partnership  agreement  authorized the sale of up to 15,000 units at $1,000
per Unit  ("Units").  The offering of Units  concluded on December 31, 1993,  at
which time 15,000 Units representing  subscriptions in the amount of $15,000,000
had been accepted.  The General Partner has 1% interest in operating profits and
losses,  taxable  income and losses,  cash available for  distribution  from the
Partnership  and  tax  credits.  The  limited  partners  will be  allocated  the
remaining 99% of these items in proportion to their respective investments.

After the limited  partners  have received  proceeds from a sale or  refinancing
equal to their capital  contributions and their return on investment (as defined
in the  Partnership  Agreement)  and the General  Partner has received  proceeds
equal  to its  capital  contribution  and a  subordinated  disposition  fee  (as
described in Note 3) from the  remainder,  any  additional  sale or  refinancing
proceeds will be distributed 90% to the limited partners (in proportion to their
respective investments) and 10% to the General Partner.


                                       7
<PAGE>


                      WNC HOUSING TAX CREDIT FUND III, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED
                  For the Quarterly Period Ended June 30, 2003
                                   (unaudited)


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued
--------------------------------------------------------------

Risks and Uncertainties
-----------------------

An investment in the  Partnership  and the  Partnership's  investments  in Local
Limited  Partnerships  and their Housing  Complexes are subject to risks.  These
risks may impact the tax benefits of an investment in the  Partnership,  and the
amount of proceeds  available for distribution to the Limited Partners,  if any,
on liquidation of the Partnership's investments. Some of those risks include the
following:

The Low Income  Housing  Credit rules are extremely  complicated.  Noncompliance
with these rules results in the loss of future Low Income  Housing  Credit s and
the fractional  recapture of Low Income Housing  Credits  already taken. In most
cases the annual amount of Low Income Housing Credits that an individual can use
is limited to the tax  liability  due on the  person's  last  $25,000 of taxable
income.  The  Local  Limited  Partnerships  may be  unable  to sell the  Housing
Complexes at a profit. Accordingly,  the Partnership may be unable to distribute
any cash to its investors.  Low Income  Housing  Credits may be the only benefit
from an investment in the Partnership.

The Partnership has invested in a limited number of Local Limited  Partnerships.
Such  limited  diversity  means that the  results of  operation  of each  single
Housing  Complex  will have a greater  impact on the  Partnership.  With limited
diversity,   poor   performance   of  one  Housing   Complex  could  impair  the
Partnership's ability to satisfy its investment objectives. Each Housing Complex
is subject to mortgage  indebtedness.  If a Local Limited  Partnership failed to
pay its  mortgage,  it  could  lose  its  Housing  Complex  in  foreclosure.  If
foreclosure  were to occur during the first 15 years,  the loss of any remaining
Low Income Housing Credits,  a fractional  recapture of prior Low Income Housing
Credits and a loss of the Partnership's  investment in the Housing Complex would
occur. The Partnership is a limited partner or non-managing member of each Local
Limited Partnership.  Accordingly, the Partnership will have very limited rights
with respect to management of the Local Limited  Partnerships.  The  Partnership
will rely  totally on the Local  General  Partners.  Neither  the  Partnership's
investments in Local Limited  Partnerships,  nor the Local Limited Partnerships'
investments  in Housing  Complexes,  are readily  marketable.  To the extent the
Housing Complexes receive government financing or operating subsidies,  they may
be subject to one or more of the  following  risks:  difficulties  in  obtaining
tenants for the Housing  Complexes;  difficulties  in obtaining rent  increases;
limitations  on cash  distributions;  limitations  on  sales or  refinancing  of
Housing  Complexes;  limitations  on transfers  of  interests  in Local  Limited
Partnerships;  limitations on removal of Local General Partners;  limitations on
subsidy  programs;  and possible  changes in applicable  regulations.  Uninsured
casualties  could result in loss of property and Low Income Housing  Credits and
recapture of Low Income  Housing  Credits  previously  taken.  The value of real
estate is subject  to risks  from  fluctuating  economic  conditions,  including
employment rates, inflation,  tax, environmental,  land use and zoning policies,
supply and demand of similar  properties,  and  neighborhood  conditions,  among
others.

The  ability of Limited  Partners to claim tax losses  from the  Partnership  is
limited.  The IRS may audit the  Partnership or a Local Limited  Partnership and
challenge  the tax  treatment  of tax items.  The  amount of Low Income  Housing
Credits and tax losses  allocable to the  investors  could be reduced if the IRS
were successful in such a challenge.  The  alternative  minimum tax could reduce
tax benefits from an investment  in the  Partnership.  Changes in tax laws could
also impact the tax benefits from an investment  in the  Partnership  and/or the
value of the Housing Complexes.

No trading market for the Units exists or is expected to develop.  Investors may
be unable to sell their Units  except at a discount  and should  consider  their
Units to be a long-term  investment.  Individual investors will have no recourse
if they  disagree  with actions  authorized by a vote of the majority of Limited
Partners.


                                       8
<PAGE>

                      WNC HOUSING TAX CREDIT FUND III, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED
                  For the Quarterly Period Ended June 30, 2003
                                   (unaudited)


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued
--------------------------------------------------------------

Exit Strategy
-------------

The IRS  compliance  period for  low-income  housing  tax credit  properties  is
generally  15 years from  occupancy  following  construction  or  rehabilitation
completion.  WNC was one of the first in the industry to offer investments using
the tax credit.  Now these very first programs are completing  their  compliance
period.

With that in mind,  the  Partnership  is continuing to review the  Partnership's
holdings,  with special emphasis on the more mature  properties  including those
that have satisfied the IRS compliance  requirements.  The Partnership's  review
will consider many factors  including  extended use requirements on the property
(such as those due to mortgage restrictions or state compliance agreements), the
condition of the property,  and the tax  consequences  to the investors from the
sale of the property.

Upon identifying  those  properties with the highest  potential for a successful
sale,  refinancing  or  syndication,  the  Partnership  expects to proceed  with
efforts  to  liquidate  those  properties.  The  Partnership's  objective  is to
maximize the investors' return wherever possible and,  ultimately,  to wind down
those  funds  that no longer  provide  tax  benefits  to  investors.  To date no
properties in the Partnership have been selected.

Method of Accounting for Investments in Limited Partnerships
------------------------------------------------------------

The Partnership  accounts for its investments in limited  partnerships using the
equity method of  accounting,  whereby the  Partnership  adjusts its  investment
balance for its share of the Local Limited  Partnerships'  results of operations
and for any  contributions  made and  distributions  received.  The  Partnership
reviews the  carrying  amount of an  individual  investment  in a Local  Limited
Partnership for possible  impairment whenever events or changes in circumstances
indicate that the carrying  amount of such  investment  may not be  recoverable.
Recoverability  of such  investment  is measured by a comparison of the carrying
amount to future  undiscounted  net cash flows  expected to be generated.  If an
investment  is  considered  to be impaired,  the  impairment to be recognized is
measured by the amount by which the carrying  amount of the  investment  exceeds
fair value.  The  accounting  policies of the Local  Limited  Partnership's  are
generally  consistent  with  those of the  Partnership.  Costs  incurred  by the
Partnership  in  acquiring  the  investments  are  capitalized  as  part  of the
investment account and are being amortized over 30 years (See Notes 2 and 3).

Equity in losses from Local Limited  Partnerships for the periods ended June 30,
2003 and 2002 have been recorded by the Partnership  based on on three months of
results  estimated by management at the Partnership.  Management's  estimate for
the three-month  period is based on either actual unaudited  results reported by
the Local Limited  Partnerships  or historical  trends in the  operations of the
Local Limited  Partnerships.  Equity in losses from Local  Limited  Partnerships
allocated  to the  Partnership  are  not  recognized  to  the  extent  that  the
investment  balance  would be  adjusted  below zero.  As soon as the  investment
balance  reaches  zero,  amortization  of the  related  costs of  acquiring  the
investment are accelerated to the extent of losses available (See Note 2).

Offering Expenses
-----------------

Offering  expenses consist of underwriting  commissions,  legal fees,  printing,
filing and  recordation  fees,  and other costs  incurred  with selling  limited
partnership  interests in the  Partnership.  The General Partner is obligated to
pay all  offering  and  organization  costs in  excess of 15%  (including  sales
commissions) of the total offering proceeds.  Offering expenses are reflected as
a reduction of partners'  capital and amounted to  $2,250,000  at the end of all
periods presented.

Use of Estimates
----------------

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


                                       9
<PAGE>


                      WNC HOUSING TAX CREDIT FUND III, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED
                  For the Quarterly Period Ended June 30, 2003
                                   (unaudited)


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued
--------------------------------------------------------------

Cash and Cash Equivalents
-------------------------

The  Partnership   considers  all  highly  liquid   investments  with  remaining
maturities of three months or less when purchased to be cash equivalents.  As of
June 30, 2003 and March 31, 2003, the Partnership had no cash equivalents.

Concentration of Credit Risk
----------------------------

At June 30, 2003,  the  Partnership  has  maintained  cash balances at a certain
financial institution in excess of the maximum federally insured amounts.

Net Loss Per Limited Partner Unit
---------------------------------

Net loss per  limited  partner  unit is  calculated  pursuant  to  Statement  of
Financial  Accounting  Standards No. 128,  Earnings Per Share. Net loss per unit
includes no dilution  and is computed  by  dividing  loss  available  to limited
partners by the weighted average number of units outstanding  during the period.
Calculation of diluted net loss per unit is not required.

Reporting Comprehensive Income
------------------------------

The  Statement of Financial  Accounting  Standards  ("SFAS") No. 130,  Reporting
Comprehensive  Income  established  standards  for the  reporting and display of
comprehensive  income (loss) and its components in a full set of general-purpose
financial statements. The Partnership had no items of other comprehensive income
for all periods presented, as defined by SFAS No. 130.

New Accounting Pronouncements
-----------------------------

In June 2001, the Financial Accounting Standards Board ("FASB") issued Statement
of  Financial  Accounting  Standards  ("SFAS")  No. 143,  "Accounting  for Asset
Retirement  Obligations",  which requires that the fair value of a liability for
an asset  retirement  obligation  be  recognized  in the  period  in which it is
incurred with the associated asset retirement costs being  capitalized as a part
of the  carrying  amount of the  long-lived  asset.  SFAS No. 143 also  includes
disclosure   requirements   that  provide  a  description  of  asset  retirement
obligations   and   reconciliation   of  changes  in  the  components  of  those
obligations.  The statement is effective for fiscal years  beginning  after June
15,  2002.  The  adoption of SFAS No. 143 did not have a material  effect on the
Partnership's financial position or results of operations.

In August  2001,  the FASB  issued  SFAS No.  144,  "Impairment  or  Disposal of
Long-Lived  Assets," which addresses  accounting and financial reporting for the
impairment or disposal of long-lived assets. This standard was effective for the
Partnership's financial statements beginning January 1, 2002. The implementation
of SFAS No. 144 did not have a material  impact on the  Partnership's  financial
position or results of operations.

In April 2002, the FASB issued SFAS No. 145,  "Rescission of FASB Statements No.
4, 44, and 64,  Amendment of FASB Statement No. 13, and Technical  Corrections."
SFAS No. 145 rescinded three previously  issued  statements and amended SFAS No.
13, "Accounting for Leases." The statement provides reporting standards for debt
extinguishments   and   provides   accounting   standards   for  certain   lease
modifications that have economic effects similar to sale-leaseback transactions.
The statement is effective for certain lease  transactions  occurring  after May
15,  2002 and all other  provisions  of the  statement  shall be  effective  for
financial statements issued on or after May 15, 2002. The implementation of SFAS
No. 145 did not have a material impact on the Partnership's  financial  position
or results of operations.

In June 2002,  the FASB issued SFAS No. 146,  "Accounting  for Costs  Associated
with Exit or  Disposal  Activities,"  which  updates  accounting  and  reporting
standards for personnel and operational restructurings.  The Partnership adopted
SFAS No. 146 for exit,  disposal  or other  restructuring  activities  initiated
after  December 31,  2002.  The adoption of SFAS No. 146 did not have a material
effect on the Partnership's financial position or results of operations.

                                       10
<PAGE>


                      WNC HOUSING TAX CREDIT FUND III, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED
                  For the Quarterly Period Ended June 30, 2003
                                   (unaudited)


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued
--------------------------------------------------------------

In November 2002, the FASB issued Interpretation No. 45 ("FIN 45"), "Guarantor's
Accounting  and  Disclosure  Requirements  for  Guarantees,  Including  Indirect
Guarantees  of  Indebtedness  of Others."  The adoption of FIN 45 did not have a
material impact on the Partnership's finacial position or results of operations.

In December  2002,  the FASB issued SFAS No. 148,  "Accounting  for  Stock-Based
Compensation  - Transition  and Disclosure - an Amendment to SFAS No. 123." SFAS
No. 148 provides alternative methods of transition for a voluntary change to the
fair value based method on accounting for stock-based employee compensation. The
implementation  of SFAS No. 148 is not expected to have a material effect on the
Partnership's financial position or results of operations.

In  January   2003,   the  FASB  issued   Interpretation   No.  46  ("FIN  46"),
"Consolidation  of Variable  Interest  Entities." The adoption of FIN 46 did not
have a material  impact on the  Partnership's  financial  position or results of
operations.


NOTE 2 - INVESTMENTS IN LIMITED PARTNERSHIPS
--------------------------------------------

As of the periods  presented,  the Partnership has acquired limited  partnership
interests  in 48 Local  Limited  Partnerships,  each of which  owns one  Housing
Complex  consisting of an aggregate of 1,685  apartment  units.  The  respective
general  partners  of the  Local  Limited  Partnerships  manage  the  day-to-day
operations  of the entities.  Significant  Local  Limited  Partnership  business
decisions require approval from the Partnership.  The Partnership,  as a limited
partner,  is  generally  entitled  to 99%,  as  specified  in the Local  Limited
Partnership agreements,  of the operating profits and losses, taxable income and
losses and tax credits of the Local Limited Partnerships.

Equity  in  losses  of the  Local  Limited  Partnerships  is  recognized  in the
financial  statements until the related  investment account is reduced to a zero
balance. Losses incurred after the investment account is reduced to zero are not
recognized. If the Local Limited Partnerships report net income in future years,
the  Partnership  will resume applying the equity method only after its share of
such net  income  equals  the share of net  losses  not  recognized  during  the
period(s) the equity method was suspended.

Distributions received by limited partners are accounted for as a reduction of
the investment balance. Distributions received after the investment has reached
zero are recognized as income.

Following is a summary of the equity method activity of the investments in Local
Limited Partnerships for the periods presented below:
<TABLE>
<CAPTION>


                                                                   For the Three             For the Year
                                                                    Months Ended                 Ended
                                                                   June 30, 2003            March 31, 2003
                                                                ---------------------      ------------------
<S>                                                           <C>                        <C>
     Investments per balance sheet, beginning of period       $           1,358,402      $        1,816,995
     Equity in losses of limited partnerships                               (46,485)               (409,732)
     Distributions received from limited partnerships                             -                 (19,911)
     Amortization of capitalized acquisition fees and
     costs                                                                   (7,235)                (28,940)
                                                                ---------------------      ------------------
     Investments per balance sheet, end of period             $           1,304,692      $        1,358,412
                                                                =====================      ==================
</TABLE>


                                       11
<PAGE>


                      WNC HOUSING TAX CREDIT FUND III, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED
                  For the Quarterly Period Ended June 30, 2003
                                   (unaudited)

NOTE 2 - INVESTMENTS IN LIMITED PARTNERSHIPS, continued
-------------------------------------------------------

Selected financial information for the three months ended June 30, 2003 and 2002
from the  unaudited  combined  condensed  financial  statements  of the  limited
partnerships in which the Partnership has invested as follows:
<TABLE>
<CAPTION>

                                COMBINED CONDENSED STATEMENTS OF OPERATIONS

                                                                       2003                      2002
                                                               ----------------------      ------------------
<S>                                                          <C>                         <C>
        Revenues                                             $             1,772,000     $         1,751,000
                                                               ----------------------      ------------------
        Expenses:
          Operating expenses                                               1,203,000               1,145,000
          Interest expense                                                   440,000                 465,000
          Depreciation and amortization                                      467,000                 478,000
                                                               ----------------------      ------------------
        Total expenses                                                     2,110,000               2,088,000
                                                               ----------------------      ------------------

        Net loss                                             $              (338,000)    $          (337,000)
                                                               ======================      ==================
                                                             $              (334,000)    $          (334,000)
        Net loss allocable to the Partnership
                                                               ======================      ==================
        Net loss recorded by the Partnership                 $               (46,000)    $           (69,000)
                                                               ======================      ==================
</TABLE>

Certain Local Limited  Partnerships have incurred  significant  operating losses
and  have  working  capital  deficiencies.  In the  event  these  Local  Limited
Partnerships continue to incur significant operating losses,  additional capital
contributions  by the  Partnership  may be required to sustain the operations of
such Local Limited  Partnerships.  If additional  capital  contributions are not
made when they are  required,  the  Partnership's  investment in certain of such
Local Limited  Partnerships  could be impaired and the loss and recapture of the
related tax credits could occur.

NOTE 3 - RELATED PARTY TRANSACTIONS
-----------------------------------

Under the terms of the Partnership Agreement the Partnership has paid or is
obligated to the General Partner or its affiliates for the following fees:

(a)  Annual Asset  Management Fee. An annual asset  management fee equal to 0.5%
     of the invested assets of the Local Limited  Partnerships.  Invested Assets
     means the sum of the Partnership's  Investment in Local Limited Partnership
     Interests  and the  Partnership's  allocable  share  of the  amount  of the
     mortgage loans on and other debts related to, the Apartment Complexes owned
     by such Local  Limited  Partnerships.  Fees of  $74,866  and  $74,757  were
     incurred   during  the  three   months   ended  June  30,  2003  and  2002,
     respectively.  The Partnership  paid the General Partner $7,500 and $15,000
     of those  fees  during  the  three  months  ended  June 30,  2003 and 2002,
     respectively.

(b)  Subordinated  disposition fee. A subordinated  disposition fee in an amount
     equal to 1% of the sales price of real estate sold.  Payment of this fee is
     subordinated to the limited  partners  receiving a preferred  return of 16%
     through  June 30, 2003 and 6%  thereafter  (as  defined in the  Partnership
     Agreement)  and is payable  only if the General  Partner or its  affiliates
     render services in the sales effort.


                                       12
<PAGE>


                      WNC HOUSING TAX CREDIT FUND III, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED
                  For the Quarterly Period Ended June 30, 2003
                                   (unaudited)
<TABLE>
<CAPTION>

NOTE 3 - RELATED PARTY TRANSACTIONS, contintued
-----------------------------------------------

The accrued fees and expenses due to General Partner and affiliates consisted of
the following at:

                                                            June 30, 2003              March 31, 2003
                                                            -------------              --------------

<S>                                              <C>                            <C>
   Asset management fee payable                  $              2,457,249       $           2,389,883
   Advances from Associates                                        12,690                       2,202
                                                    ----------------------         -------------------
                                                 $              2,469,939       $           2,392,085
                                                    ======================         ===================
</TABLE>



The General  Partners do not anticipate that the accrued fees will be paid until
such time as capital  reserves are in excess of the future  foreseeable  working
capital requirements.

NOTE 4 - INCOME TAXES
---------------------

No provision for income taxes has been recorded in the financial statements,  as
any  liability  for  income  taxes  is the  obligation  of the  partners  of the
Partnership.

                                       13
<PAGE>



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

Forward-Looking Statements

With  the  exception  of  the  discussion  regarding   historical   information,
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations"  and  other   discussions   elsewhere  in  this  Form  10-Q  contain
forward-looking  statements.  Such statements are based on current  expectations
subject to uncertainties and other factors,  which may involve known and unknown
risks that could cause actual  results of operations to differ  materially  from
those  projected or implied.  Further,  certain  forward-looking  statements are
based upon assumptions about future events, which may not prove to be accurate.

Risks and uncertainties inherent in forward-looking  statements include, but are
not  limited  to,  our  future  cash  flows and  ability  to  obtain  sufficient
financing, level of operating expenses, conditions in the low-income housing tax
credit property market and the economy in general, as well as legal proceedings.
Historical  results are not necessarily  indicative of the operating results for
any future period.

Subsequent  written and oral  forward-looking  statements  attributable to us or
persons  acting on our behalf  are  expressly  qualified  in their  entirety  by
cautionary  statements  in this Form 10-Q and in other reports we filed with the
Securities and Exchange  Commission.  The following discussion should be read in
conjunction  with the  Consolidated  Financial  Statements and the Notes thereto
included elsewhere in this filing.

The following discussion and analysis compares the results of operations for the
three  months  ended June 30, 2003 and 2002,  and should be read in  conjunction
with the condensed  financial  statements and accompanying notes included within
this report.

Financial Condition

The  Partnership's  assets at June 30, 2003  consisted  primarily of $251,000 in
cash and aggregate  investments in the forty-eight Local Limited Partnerships of
$1,305,000.  Liabilities at June 30, 2003  primarily  consisted of $2,470,000 of
accrued  asset  management  fees and  expenses  due to the  General  Partner and
affiliates.

Results of Operations

Three Months  Ended June 30, 2003  Compared to Three Months Ended June 30, 2002.
The  Partnership's  net loss  for the  three  months  ended  June  30,  2003 was
$(132,000),  reflecting  a decrease  of $26,000  from the net loss for the three
months ended June 30, 2002 of  $(158,000).  This  decrease  primarily was due to
equity in  losses  of  limited  partnerships,  which  decreased  by  $23,000  to
$(46,000),  for the three months ended June 30, 2003  compared to $(69,000)  for
the  three  months  ended  June 30,  2002.  This  decrease  was a result  of the
Partnership  not recognizing  certain losses of the Local Limited  Partnerships.
The  investments in such Local Limited  Partnerships  had reached $0 at June 30,
2003.  Since the  Partnership's  liability  with respect to its  investments  is
limited,  losses in excess of  investments  are not  recognized.  Along with the
decrease  in  equity in losses of  limited  partnerships,  loss from  operations
decreased by $5,000,  from $(90,000) for the three months ended June 30, 2002 to
$(85,000)  for the three months  ended June 30,  2003,  caused by an increase in
distribution  income of  approximately  $6,000,  offset by an  increase of total
operating expense of approximately  $1,000,  for the three months ended June 30,
2003 compared to the three months ended June 30, 2002.

Cash Flows

Three months  Ended June 30, 2003  Compared to Three months Ended June 30, 2002.
Net cash  decreased  by less than  $(1,000)  for the three months ended June 30,
2003,  compared to a $(12,000) decrease for the three months ended June 30, 2002
reflecting  a change of  $11,000.  The change was  largely due to an increase of
$14,000 in accrued  fees and  expenses  due to general  partner  and  affiliates
offset by a decrease in  interest  income of $1,000 for the three  months  ended
June 30, 2003. In addition,  cash provided by investing  activities decreased by
$7,000 to $0, due to a decrease in  distributions  received  from Local  Limited
Partnerships  which were  reclassified  to  distribution  income and included in
operating activities, for the three months ended June 30, 2003.


                                       14
<PAGE>


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

During the three months  ended June 30,  2003,  accrued  asset  management  fees
payable  and  advances  due to the General  Partner  increased  by $78,000.  The
General  Partner does not anticipate  that the accrued fees and advances will be
paid until such time as capital  reserves are in excess of  foreseeable  working
capital requirements of the partnership.


Item 3.   Quantitative and Qualitative Disclosures About Market Risks

          NOT APPLICABLE

Item 4.   Procedures and Controls

          Within  the 90 days  prior to the  date of this  report,  the  General
          Partners  of the  General  Partner of the  Partnership  carried out an
          evaluation,  under  the  supervision  and  with the  participation  of
          Associates' management,  including Associates' Chief Executive Officer
          and Chief Financial  Officer,  of the  effectiveness of the design and
          operation of the  Partnership's  disclosure  controls  and  procedures
          pursuant to Exchange Act Rule 13a- 14. Based upon that evaluation, the
          Chief Executive Officer and Chief Financial Officer concluded that the
          Partnership's disclosure controls and procedures are effective.  There
          were no significant changes in the Partnership's  internal controls or
          in other  factors  that  could  significantly  affect  these  controls
          subsequent to the date of their evaluation.


                                       15
<PAGE>


PART II. OTHER INFORMATION

Item 1.  Legal Proceedings

         NONE

Item 6.   Exhibits and Reports on Form 8-K

(a)       Reports on Form 8-K.
          --------------------

1.        NONE

(b)       Exhibits.
          ---------

99.1      Certification of the Principal Executive Officer pursuant to 18 U.S.C.
          section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley
          Act of 2002. (filed herewith)

99.2      Certification of the Principal Financial Officer pursuant to 18 U.S.C.
          section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley
          Act of 2002. (filed herewith)



                                       16
<PAGE>


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.

WNC HOUSING TAX CREDIT FUND III, L.P.

By:  WNC Tax Credit Partners, L.P., General Partner of the Registrant

By: WNC & Associates,  Inc., General Partner of WNC Housing Tax Credit Fund III,
L.P.






By: /s/  Wilfred N. Cooper, Jr.
-------------------------------

Wilfred N. Cooper, Jr.
President and Chief Executive Officer of WNC & Associates, Inc.

Date:  August 19, 2003






By: /s/ Thomas J. Riha
----------------------

Thomas J. Riha
Vice President-Chief Financial Officer of WNC & Associates, Inc.

Date:  August 19, 2003



                                       17
<PAGE>


                                 CERTIFICATIONS

     I,   Wilfred N. Cooper, Jr., certify that:

     1.   I have reviewed this quarterly  report on Form 10-Q of WNC HOUSING TAX
          CREDIT FUND III, L.P.;

     2.   Based on my  knowledge,  this  quarterly  report  does not contain any
          untrue  statement of a material  fact or omit to state a material fact
          necessary to make the statements  made, in light of the  circumstances
          under which such  statements were made, not misleading with respect to
          the period covered by this quarterly report;

     3.   Based on my knowledge,  the financial statements,  and other financial
          information  included in this quarterly report,  fairly present in all
          material respects the financial  condition,  results of operations and
          cash flows of the registrant as of, and for, the periods  presented in
          this quarterly report;

     4.   The registrant's  other  certifying  officer and I are responsible for
          establishing  and maintaining  disclosure  controls and procedures (as
          defined in Exchange  Act Rules  13a-14 and 15d-14) for the  registrant
          and we have:

          (a)  designed such  disclosure  controls and procedures to ensure that
               material  information  relating to the registrant,  including its
               consolidated  subsidiaries,  is made known to us by others within
               those  entities,  particularly  during  the  period in which this
               quarterly report is being prepared;

          (b)  evaluated  the  effectiveness  of  the  registrant's   disclosure
               controls and  procedures as of a date within 90 days prior to the
               filing date of this quarterly report (the "Evaluation Date"); and

          (c)  presented  in this  quarterly  report our  conclusions  about the
               effectiveness of the disclosure  controls and procedures based on
               our evaluation as of the Evaluation Date;

     5.   The registrant's other certifying officer and I have disclosed,  based
          on our most recent  evaluation,  to the registrant's  auditors and the
          audit  committee  of  registrant's  board  of  directors  (or  persons
          performing the equivalent function):

          (a)  all  significant  deficiencies  in the  design  or  operation  of
               internal  controls which could adversely  affect the registrant's
               ability to record,  process,  summarize and report financial data
               and have  identified for the  registrant's  auditors any material
               weaknesses in internal controls; and

          (b)  any fraud,  whether or not material,  that involves management or
               other employees who have a significant  role in the  registrant's
               internal controls; and

     6.   The registrant's other certifying officer and I have indicated in this
          quarterly  report  whether  or not there were  significant  changes in
          internal controls or in other factors that could significantly  affect
          internal   controls   subsequent  to  the  date  of  our  most  recent
          evaluation,   including   any   corrective   actions  with  regard  to
          significant deficiencies and material weaknesses.

     Date:  August 19, 2003


     /s/  Wilfred N. Cooper, Jr.
     ---------------------------

     President and Chief Executive Officer of WNC & Associates, Inc.



                                       18
<PAGE>


                                 CERTIFICATIONS

     I,   Thomas J. Riha, certify that:

     1.   I have reviewed this quarterly  report on Form 10-Q of WNC HOUSING TAX
          CREDIT FUND III, L.P.;

     2.   Based on my  knowledge,  this  quarterly  report  does not contain any
          untrue  statement of a material  fact or omit to state a material fact
          necessary to make the statements  made, in light of the  circumstances
          under which such  statements were made, not misleading with respect to
          the period covered by this quarterly report;

     3.   Based on my knowledge,  the financial statements,  and other financial
          information  included in this quarterly report,  fairly present in all
          material respects the financial  condition,  results of operations and
          cash flows of the registrant as of, and for, the periods  presented in
          this quarterly report;

     4.   The registrant's  other  certifying  officer and I are responsible for
          establishing  and maintaining  disclosure  controls and procedures (as
          defined in Exchange  Act Rules  13a-14 and 15d-14) for the  registrant
          and we have:

          (a)  designed such  disclosure  controls and procedures to ensure that
               material  information  relating to the registrant,  including its
               consolidated  subsidiaries,  is made known to us by others within
               those  entities,  particularly  during  the  period in which this
               quarterly report is being prepared;

          (b)  evaluated  the  effectiveness  of  the  registrant's   disclosure
               controls and  procedures as of a date within 90 days prior to the
               filing date of this quarterly report (the "Evaluation Date"); and

          (c)  presented  in this  quarterly  report our  conclusions  about the
               effectiveness of the disclosure  controls and procedures based on
               our evaluation as of the Evaluation Date;

     5.   The registrant's other certifying officer and I have disclosed,  based
          on our most recent  evaluation,  to the registrant's  auditors and the
          audit  committee  of  registrant's  board  of  directors  (or  persons
          performing the equivalent function):

          (a)  all  significant  deficiencies  in the  design  or  operation  of
               internal  controls which could adversely  affect the registrant's
               ability to record,  process,  summarize and report financial data
               and have  identified for the  registrant's  auditors any material
               weaknesses in internal controls; and

          (b)  any fraud,  whether or not material,  that involves management or
               other employees who have a significant  role in the  registrant's
               internal controls; and

     6.   The registrant's other certifying officer and I have indicated in this
          quarterly  report  whether  or not there were  significant  changes in
          internal controls or in other factors that could significantly  affect
          internal   controls   subsequent  to  the  date  of  our  most  recent
          evaluation,   including   any   corrective   actions  with  regard  to
          significant deficiencies and material weaknesses.

     Date:  August 19, 2003


     /s/ Thomas J. Riha
     ------------------

     Vice-President - Chief Financial Officer of WNC & Associates, Inc.






                                       19