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 Quarterly Period Ended September 30, 1997

                                    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 #0-21606


                        InLand Capital Fund, L.P. 
          (Exact name of registrant as specified in its charter)


         Delaware                                     #36-3767977
  (State or other jurisdiction      (I.R.S. Employer Identification Number) 
of incorporation or organization)


       2901 Butterfield Road, Oak Brook, Illinois         60523
        (Address of principal executive office)         (Zip Code)


    Registrant's telephone number, including area code:  630-218-8000


                                 N/A                        
              (Former name, former address and former fiscal
                    year, if changed since last report)


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   







                                    -1-


                           INLAND CAPITAL FUND, L.P.
                            (a limited partnership)

                                Balance Sheets

                   September 30, 1997 and December 31, 1996
                                  (unaudited)

                                    Assets
                                    ------

                                                       1997          1996
Current assets:                                        ----          ----
  Cash and cash equivalents (Note 1).............. $ 1,056,403       581,693
  Investments in marketable securities (Note 1)...     174,800     1,077,802
  Accrued interest and other receivables..........      72,699         4,903
  Other current assets............................       4,174         2,702
                                                   ------------  ------------
Total current assets..............................   1,308,076     1,667,100
                                                   ------------  ------------
Other assets......................................     130,856          -
Investment properties and improvements
  (including acquisition fees paid to
  Affiliates of $1,413,765 and $1,418,902 at 
  September 30, 1997 and December 31, 1996, 
  respectively) (Notes 1, 2 and 3)................  28,080,988    27,714,600
                                                   ------------  ------------
Total assets...................................... $29,519,920    29,381,700
                                                   ============  ============



























                See accompanying notes to financial statements.


                                    -2-


                           INLAND CAPITAL FUND, L.P.
                            (a limited partnership)

                                Balance Sheets
                                  (continued)

                   September 30, 1997 and December 31, 1996
                                  (unaudited)

                       Liabilities and Partners' Capital
                       ---------------------------------


                                                       1997          1996
Current liabilities:                                   ----          ----
  Accounts payable................................ $     2,484       474,058
  Accrued real estate taxes.......................      54,889        73,031
  Due to Affiliates (Note 2)......................      52,746         6,451
  Unearned income.................................       6,050        30,528
                                                   ------------  ------------
Total current liabilities.........................     116,169       584,068
                                                   ------------  ------------
Partners' capital (Notes 1 and 2):
  General Partner:
    Capital contribution..........................         500           500
    Cumulative net income.........................      12,707        13,040
                                                   ------------  ------------
                                                        13,207        13,540
  Limited Partners:                                ------------  ------------
    Units of $1,000.  Authorized 60,000 Units,
    32,362.11 and 32,377.11 Units outstanding at
    September 30, 1997 and December 31, 1996,
    respectively (net of offering costs of
    $4,466,765, of which $3,488,574 was paid to
    Affiliates)...................................  27,896,041    27,910,743
    Cumulative cash distributions.................    (646,668)     (646,474)
    Cumulative net income.........................   2,141,171     1,519,823
                                                   ------------  ------------
                                                    29,390,544    28,784,092
                                                   ------------  ------------
Total Partners' capital...........................  29,403,751    28,797,632
                                                   ------------  ------------
Total liabilities and Partners' capital........... $29,519,920    29,381,700
                                                   ============  ============












                See accompanying notes to financial statements.

                                    -3-


                           INLAND CAPITAL FUND, L.P.
                            (a limited partnership)

                           Statements of Operations

        For the three and nine months ended September 30, 1997 and 1996
                                  (unaudited)


                                        Three months            Nine months
                                           ended                  ended
                                        September 30,          September 30,
                                        -------------          -------------
                                       1997       1996       1997       1996
Income:                                ----       ----       ----       ----
  Sale of investment property
    (Notes 1 and 3)................ $ 650,724       -       779,900       -
  Rental income....................    81,048     74,265    227,554    215,727
  Interest income..................    13,370     28,905     42,390     95,970
  Other income.....................        25        500     28,025        500
                                    ---------- ---------- ---------- ----------
                                      745,167    103,670  1,077,869    312,197
Expenses:                           ---------- ---------- ---------- ----------
  Cost of investment property sold.   104,075       -       125,537       -
  Professional services to
    Affiliates.....................     9,500     10,702     29,074     23,706
  Professional services to
    non-affiliates.................       841        427     44,612     26,647
  General and administrative
    expenses to Affiliates.........     2,815     11,007     15,902     26,172
  General and administrative
    expenses to non-affiliates.....     1,924      2,141     11,610     10,742
  Marketing expenses to Affiliates.    25,313      3,888     75,044     16,659
  Marketing expenses to
    non-affiliates.................     7,444     22,136     42,458     32,433
  Land operating expenses to
    Affiliates.....................    15,924     15,958     47,838     47,876
  Land operating expenses to
    non-affiliates.................    26,121     22,701     64,779     59,813
  Amortization of deferred
    organization costs.............      -           728       -         2,187
                                    ---------- ---------- ---------- ----------
                                      193,957     89,688    456,854    246,235
                                    ---------- ---------- ---------- ----------
Net income......................... $ 551,210     13,982    621,015     65,962
                                    ========== ========== ========== ==========










                See accompanying notes to financial statements.


                                    -4-


                           INLAND CAPITAL FUND, L.P.
                            (a limited partnership)

                           Statements of Operations
                                  (continued)

        For the three and nine months ended September 30, 1997 and 1996
                                  (unaudited)


                                        Three months           Nine months
                                           ended                  ended
                                        September 30,         September 30,
                                        -------------         -------------
                                       1997       1996       1997       1996
Net income (loss) allocated to:        ----       ----       ----       ----
  General Partner.................. $      46        140       (333)       660
  Limited Partners.................   551,164     13,842    621,348     65,302
                                    ---------- ---------- ---------- ----------
Net income......................... $ 551,210     13,982    621,015     65,962 
                                    ========== ========== ========== ==========

Net income (loss) allocated to the
  one General Partner Unit......... $      46        140       (333)       660 
                                    ========== ========== ========== ==========

Net income allocated to Limited 
  Partners per weighted average
  Limited Partnership Units
  (32,372.11 and 32,383.85 for 
  the three months ended September
  30, 1997 and 1996, and 32,373.19
  and 32,392.67 for the nine months
  ended September 30, 1997 and 
  1996, respectively).............. $   17.02        .43      19.19       2.02
                                    ========== ========== ========== ==========




















                See accompanying notes to financial statements.


                                    -5-


                           INLAND CAPITAL FUND, L.P.
                            (a limited partnership)

                           Statements of Cash Flows

             For the nine months ended September 30, 1997 and 1996
                                  (unaudited)




                                                       1997          1996
Cash flows from operating activities:                  ----          ----
  Net income...................................... $   621,015        65,962
  Adjustments to reconcile net income to net
      cash provided by (used in) operating
      activities:
    Amortization of deferred organization costs...        -            2,187
    Gain on sale of investment property...........    (654,363)         -
    Changes in assets and liabilities:
      Accrued interest and other receivables......     (67,796)      (44,288)
      Other current assets........................      (1,472)       (3,006)
      Accounts payable............................    (471,574)        3,032
      Accrued real estate taxes...................     (18,142)      (23,192)
      Due to Affiliates...........................      46,295        36,818
      Unearned income.............................     (24,478)      (23,137)
Net cash provided by (used in) operating           ------------  ------------
  activities......................................    (570,515)       14,376
                                                   ------------  ------------
Cash flows from investing activities:
  Sale (purchase) of marketable securities, net...     903,002     1,000,000
  Additions to investment properties..............    (491,925)     (611,123)
  Other assets....................................    (130,856)         -
  Proceeds from sale of investment properties.....     779,900          -
                                                   ------------  ------------
Net cash provided by investing activities.........   1,060,121       388,877
                                                   ------------  ------------
Cash flows from financing activities:
  Repurchase of Limited Partnership Units.........     (14,702)      (19,600)
  Cash distributions..............................        (194)         (140)
                                                   ------------  ------------
Net cash used in financing activities.............     (14,896)      (19,740)
                                                   ------------  ------------
Net increase in cash and cash equivalents.........     474,710       383,513
Cash and cash equivalents at beginning of period..     581,693       708,979
                                                   ------------  ------------
Cash and cash equivalents at end of period........ $ 1,056,403     1,092,492
                                                   ============  ============








                See accompanying notes to financial statements.


                                    -6-


                           INLAND CAPITAL FUND, L.P.
                            (a limited partnership)

                         Notes to Financial Statements

                              September 30, 1997
                                  (unaudited)


Readers of this  Quarterly  Report  should  refer  to the Partnership's audited
financial statements for the  fiscal  year  ended  December 31, 1996, which are
included  in  the  Partnership's  1996   Annual  Report,  as  certain  footnote
disclosures which would substantially duplicate those contained in such audited
financial statements have been omitted from this Report.

(1)  Organization and Basis of Accounting

InLand Capital Fund, L.P. (the "Partnership") was organized on June 21, 1991 by
the filing of a Certificate  of  Limited  Partnership under the Revised Uniform
Limited Partnership Act of the  State  of  Delaware.  On December 13, 1991, the
Partnership commenced an Offering of 60,000 Limited Partnership Units ("Units")
pursuant to a Registration under  the  Securities  Act of 1933. The Amended and
Restated  Agreement  of  Limited   Partnership  (the  "Partnership  Agreement")
provides for  Inland  Real  Estate  Investment  Corporation  to  be the General
Partner.  The Offering  terminated  on  August  23,  1993,  with total sales of
32,399.28 Units, at $1,000 per Unit, resulting in $32,399,282 in gross offering
proceeds, not including the General Partner's capital contribution of $500. All
of the holders of  these  Units  have  been  admitted  to the Partnership.  The
Limited Partners of the Partnership will  share in their portion of benefits of
ownership of  the  Partnership's  real  property  investments  according to the
number of Units held. As of September 30, 1997, the Partnership has repurchased
and canceled a total of 37.17  Units  for $36,476 from various Limited Partners
through the Units Repurchase Program.  Under this program, Limited Partners may
under certain circumstances have their Units repurchased for an amount equal to
their Invested Capital.

The preparation of financial  statements  in conformity with generally accepted
accounting principles 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 periods.
Actual results could differ from those estimates.

Offering costs have been offset against the Limited Partners' capital accounts.

The Partnership  considers  all  highly  liquid  investments  purchased with an
original maturity of three months or less to be cash equivalents.

Investments purchased with an  original  maturity  of  three months or more are
considered to be investments in marketable securities.








                                    -7-


 .                          INLAND CAPITAL FUND, L.P.
                            (a limited partnership)

                         Notes to Financial Statements
                                  (continued)

                              September 30, 1997
                                  (unaudited)


For  vacant  land  parcels   and   parcels  with  insignificant  buildings  and
improvements,  the  Partnership  uses  the  area  method  of  allocation, which
approximates the relative sales method of  allocation, whereby a per acre price
is used as the standard allocation  method  for  land purchases and sales.  The
total cost of the parcel is divided by the total number of acres to arrive at a
per acre price.  Repair and  maintenance  expenses are charged to operations as
incurred.

Statement of Financial Accounting Standards  No.  121 ("SFAS 121") requires the
Partnership to record  an  impairment  loss  on  its  property  to  be held for
investment whenever  its  carrying  value  cannot  be  fully  recovered through
estimated undiscounted future cash flows  from  their operations and sale.  The
amount of the impairment loss to  be recognized would be the difference between
the property's carrying value  and  the  property's  estimated fair value.  The
adoption of SFAS 121 did  not  have  any  effect on the Partnership's financial
position, results of operations or liquidity.     As of September 30, 1997, the
Partnership has not recognized any such impairment.

The Partnership is required to  pay  a  withholding tax to the Internal Revenue
Service with  respect  to  a  Partner's  allocable  share  of the Partnership's
taxable net income, if the  Partner  is  a foreign person. The Partnership will
first pay the withholding tax from the distributions to any foreign person, and
to the extent that the tax exceeds  the amount of distributions withheld, or if
there have been no distributions to  withhold, the excess will be accounted for
as a distribution to the  foreign  person. Future withholding tax payments will
be made every April, June, September and December.

No provision for Federal income taxes  has  been made as the liability for such
taxes is that of the Partners rather than the Partnership.

In  the  opinion  of  management,  the  financial  statements  contain  all the
adjustments necessary, which  are  of  a  normal  recurring  nature, to present
fairly  the  financial  position  and  results  of  operations  for  the period
presented herein.  Results of interim periods are not necessarily indicative of
results to be expected for the year.













                                    -8-


                           INLAND CAPITAL FUND, L.P.
                            (a limited partnership)

                         Notes to Financial Statements
                                  (continued)

                              September 30, 1997
                                  (unaudited)


(2)  Transactions with Affiliates

The General  Partner  and  its  Affiliates  are  entitled  to reimbursement for
salaries and expenses of employees  of  the  General Partner and its Affiliates
relating to the administration of the  Partnership.  Such costs are included in
professional services and general and administrative expenses to Affiliates, of
which $11,802 and $6,451 was unpaid  as  of September 30, 1997 and December 31,
1996, respectively.

The General Partner is entitled to  receive Asset Management Fees equal to one-
quarter of 1% of  the  original  cost  to  the  Partnership of undeveloped land
annually, limited to a cumulative total over  the life of the Partnership of 2%
of the land's original  cost  to  the  Partnership.    Such fees of $47,838 and
$47,876 have been  incurred  and  are  included  in  land operating expenses to
Affiliates for the nine months ended September 30, 1997 and 1996, respectively,
of which $15,924 was unpaid as of September 30, 1997.

An Affiliate of the General  Partner  performed sales marketing and advertising
services for the Partnership and  was  reimbursed  (as set forth under terms of
the Partnership Agreement) for direct costs.  Such costs of $75,044 and $16,659
have been incurred and are included in marketing expenses to Affiliates for the
nine months ended September 30,  1997  and 1996, respectively, of which $25,020
was unpaid as of September 30, 1997.

An Affiliate of  the  General  Partner  performed  property upgrades, rezoning,
annexation and other activities  to  prepare the Partnership's land investments
for sale and  was  reimbursed  (as  set  forth  under  terms of the Partnership
Agreement) for salaries and direct costs.   The Affiliate did not take a profit
on any project.  Such costs are included in investment properties, all of which
have been paid.


















                                    -9-


<TABLE>                                                INLAND CAPITAL FUND, L.P.
                                                        (a limited partnership)

                                                     Notes to Financial Statements
                                                              (continued)
(3) Investment Properties
<CAPTION>
All of the Partnership's investment properties are located in  the collar counties surrounding the Chicago metropolitan area.  The
following real property investments are owned by the Partnership as of September 30, 1997:
                                                                                                            Total
                   Gross                           Initial Costs                 Costs                    Remaining     Current
                   Acres    Purchase/ --------------------------------------  Capitalized     Costs of     Costs of    Year Gain
Parcel Location: Purchased   Sales      Original   Acquisition     Total     Subsequent to    Property    Parcels at    On Sale
  #      County   /(Sold)     Date        Costs       Costs        Costs      Acquisition       Sold        9/30/97    Recognized
------ --------- --------- ---------- ------------ ------------ ------------ -------------- ------------ ------------ ------------
<S>    <C>       <C>       <C>          <C>            <C>        <C>            <C>           <C>         <C>           <C>
  1    Kendall   108.8960  07/22/92   $   707,566       57,926      765,492         75,485         -         840,977         -

  2    McHenry   201.0000  11/09/93     2,020,314      122,145    2,142,459      1,294,173      251,599    3,185,033       82,117
                 (17.742)  08/02/95
                  (1.929)  09/02/97

  3    Will       34.0474  03/04/94     1,235,830       88,092    1,323,922         16,378         -       1,340,300         -

  4    Will       86.9195  03/30/94     1,778,820      143,817    1,922,637        226,105       70,411    2,078,331      572,246
                   (.8700) 06/07/97
                  (1.4350) 08/12/97

  5    LaSalle   190.9600  04/01/94       532,000       18,145      550,145         62,719         -         612,864         -

  6    DeKalb     59.0800  05/11/94       670,207       58,373      728,580        477,806         -       1,206,386         -

  7    Kendall   200.8210  07/28/94     1,506,158       82,999    1,589,157         20,222         -       1,609,379         -

  8    Kendall   133.0000  08/17/94     1,300,000      106,949    1,406,949          3,392         -       1,410,341         -

  9    LaSalle   335.9600  08/30/94       993,441       79,329    1,072,770        108,173         -       1,180,943         -

  10   Kendall   223.7470  09/16/94     2,693,025      205,660    2,898,685         21,856         -       2,920,541         -

10A(a) Kendall     7.0390  09/16/94       206,975       15,806      222,781          1,327      221,078         -            -
                  (7.0390) 04/21/95

  11   Kane      123.0000  09/26/94     1,353,000       75,551    1,428,551          4,289         -       1,432,840         -

  12   Kendall   110.2530  09/28/94       600,001       51,220      651,221         34,969         -         686,190         -

  13   LaSalle   352.7390  10/06/94     1,032,666       91,117    1,123,783         20,856         -       1,144,639         -

  14   Kendall   134.7760  10/26/94     1,000,000       81,674    1,081,674          4,656         -       1,086,330         -

  15   McHenry   169.5400  10/31/94     2,900,000       79,196    2,979,196        155,408         -       3,134,604         -

  16   McHenry   207.0754  11/30/94     1,760,256      101,388    1,861,644        152,730         -       2,014,374         -

  17   LaSalle   236.4400  12/07/94     1,060,286       74,735    1,135,021            494         -       1,135,515         -

  18   Kendall   386.9900  11/02/95       934,993      126,329    1,061,322             79         -       1,061,401         -
                                      ------------ ------------ ------------ -------------- ------------ ------------ ------------
                                      $24,285,539    1,660,450   25,945,989      2,681,117      543,088   28,080,988      654,363
                                      ============ ============ ============ ============== ============ ============ ============
</TABLE>

                                   -10-


                           INLAND CAPITAL FUND, L.P.
                            (a limited partnership)

                         Notes to Financial Statements
                                  (continued)

                              September 30, 1997
                                  (unaudited)


(3) Investment Properties (continued)

(a) Included in the purchase of Parcel 10 was a house and several outbuildings,
    located on approximately seven acres, which was sold on April 21, 1995.

(b) Reconciliation of real estate owned:
                                                       1997          1996
                                                       ----          ----
  Balance at January 1,........................... $27,714,600    26,130,416
  Additions during period.........................     491,925     1,584,184
  Sales during period.............................    (125,537)         -
                                                   ------------  ------------
  Balance at end of period........................ $28,080,988    27,714,600
                                                   ============  ============


(4) Farm Rental Income

The Partnership has determined that all leases relating to the farm parcels are
operating leases.  Accordingly, rental income is reported when earned.

As of September 30, 1997, the Partnership had farm leases of generally one year
in duration, for approximately  2,834  acres  of  the approximately 3,273 acres
owned.
























                                   -11-


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

Certain statements in this  "Management's  Discussion and Analysis of Financial
Condition and Results of Operations" and  elsewhere in this quarterly report on
Form 10-Q constitute  "forward-looking  statements"  within  the meaning of the
Federal Private Securities  Litigation  Reform  Act  of  1995.   These forward-
looking statements involve  known  and  unknown  risks, uncertainties and other
factors which  may  cause  the  Partnership's  actual  results,  performance or
achievements to be materially different from any future results, performance or
achievements expressed or implied  by  these forward-looking statements.  These
factors include,  among  other  things,  federal,  state  or local regulations;
adverse changes in general economic  or local conditions; inability of borrower
to meet financial  obligations;  uninsured  losses;  and potential conflicts of
interest between the  Partnership  and  its  Affiliates,  including the General
Partner.

Liquidity and Capital Resources

On December 13, 1991, the  Partnership  commenced an Offering of 60,000 Limited
Partnership Units ("Units")  at  $1,000  per  Unit,  pursuant to a Registration
Statement on  Form  S-11  under  the  Securities  Act  of  1933.   The Offering
terminated on August 23, 1993, with  total  sales of 32,399.28 Units, at $1,000
per Unit, resulting in  $32,399,282  in  gross offering proceeds, not including
the General Partner's capital contribution of $500. All of the holders of these
Units have been admitted  to  the  Partnership.    The  Limited Partners of the
Partnership will  share  in  their  portion  of  benefits  of  ownership of the
Partnership's real property investments according to the number of Units held.

The Partnership used $25,945,989 of gross  offering proceeds to purchase, on an
all-cash basis, eighteen parcels of  land  and one building.  These investments
include the payment of  the  purchase  price,  acquisition fees and acquisition
costs of such properties.  One  of  the  parcels was purchased during 1992, one
during 1993, fifteen during 1994  and  one  during  1995.   As of September 30,
1997, the Partnership has had multiple  sales transactions through which it has
disposed of the building and approximately twenty-nine acres of the 3,302 acres
originally owned.  As of  September  30,  1997, cumulative distributions to the
Limited Partners have totaled $646,668  (which  represents a return of Invested
Capital, as defined the  Partnership  Agreement).   Through September 30, 1997,
the Partnership has used $2,681,117 of working capital reserve for rezoning and
other activities and such amount is included in investment properties.

The Partnership's capital needs and resources will vary depending upon a number
of factors, including the extent to which the Partnership conducts rezoning and
other  activities  relating  to  utility  access,  the  installation  of roads,
subdivision and/or annexation of land to a municipality, changes in real estate
taxes affecting the Partnership's land, and the amount of revenue received from
leasing.  As of September 30, 1997,  the Partnership owns, in whole or in part,
all eighteen of its original parcels, the majority of which are leased to local
farmers and are  generating  sufficient  cash  flow  from  farm leases to cover
property taxes and insurance.







                                   -12-


At  September  30,  1997,  the  Partnership  had  cash,  cash  equivalents  and
investments in  marketable  securities  of  $1,231,203  of  which approximately
$160,300 is reserved for the  repurchase  of  Units through the Unit Repurchase
Program.  The remaining $1,070,903 is  available, upon maturity, to be used for
Partnership expenses and liabilities, cash distributions to partners, and other
activities with respect to some or  all  of  its land parcels.  The Partnership
plans to maximize  its  parcel  sales  effort  in  anticipation  of rising land
values.

The Partnership plans to enhance the  value of its land through pre-development
activities such as rezoning, annexation  and land planning. The Partnership has
already been successful in, or is in the process of pre-development activity on
a majority of the  Partnership's  land  investments.  Parcel  2, annexed to the
village of McHenry and zoned for a business park, has improvements underway and
sites are being marketed to potential buyers, of which two of the 190 lots were
sold on September 2, 1997.  Parcel 4, zoned for a variety of business uses, has
improvements underway and  sites  are  being  marketed  to potential buyers, of
which one site consisting of .87  acres  was  sold  to a hotel chain on June 7,
1997 and another site consisting of  1.435  acres was sold to a combination gas
station/convenient store on  August  12,  1997.  (See  Note  3  of the Notes to
Financial Statements.) Parcel 6, annexed to the village of DeKalb and zoned for
twenty-five  large,  residential  lots,   has   completed  the  road  into  the
subdivision and the lots  are  being  marketed to homebuilders and individuals.
Parcels 15 and 16 have been  annexed  to  the  village of Huntley and zoned for
residential and commercial development.

Results of Operations

As of September  30,  1997,  the  Partnership  owned  eighteen  parcels of land
consisting  of  approximately   3,273   acres.   Of   the  3,273  acres  owned,
approximately 2,834 acres are  tillable  and  leased  to  local farmers and are
generating sufficient cash flow  to  cover  property taxes, insurance and other
miscellaneous property expenses.  The  sale  of  investment property income and
cost of investment property sold for  the three and nine months ended September
30, 1997 is the result of the sale  of  .87  acres of Parcel 4 on June 6, 1997,
the sale of 1.435 acres of Parcel  4  on  August 12, 1997 and the sale of 1.929
acres of Parcel 2 on September 2, 1997.   The increase in rental income for the
three and nine months ended September  30,  1997,  as compared to the three and
nine months ended September  30,  1996,  is  due  to  annual increases in lease
amounts from  tenants.    The  increase  in  land  operating  expenses  to non-
affiliates for the three and nine  months ended September 30, 1997, as compared
to the three and nine months ended  September  30, 1996, is due primarily to an
increase in real  estate  taxes.    This  increase  was  partially  offset by a
decrease in insurance expenses.

Interest income decreased for  the  three  and  nine months ended September 30,
1997, as compared to the three  and  nine  months ended September 30, 1996, due
primarily to the Partnership utilizing its working capital reserve to fund pre-
development activity on its land parcels.

The increase in other income for  the  nine months ended September 30, 1997, as
compared to the nine months ended  September  30, 1996, is due primarily to the
Partnership receiving a non-refundable  deposit  on  a  land sale which did not
occur.  




                                   -13-


Professional  services  to  Affiliates  increased  for  the  nine  months ended
September 30, 1997, as compared  to  the  nine months ended September 30, 1996,
due to an  increase  in  legal  services  required  by  the  Partnership.  This
increase was partially offset by a  decrease in accounting services required by
the Partnership.   Professional  services  to  non-affiliates increased for the
three and nine months ended September  30,  1997,  as compared to the three and
nine months ended  September  30,  1996,  due  to  increases  in outside legal,
accounting and other professional fees.

General and administrative expenses to  Affiliates  decreased for the three and
nine months ended September 30, 1997, as  compared to the three and nine months
ended September 30, 1996, due to  a  decrease in investor services, postage and
data  processing  expenses.    General  and  administrative  expenses  to  non-
affiliates increased for the nine months  ended September 30, 1997, as compared
to the nine months ended  September  30,  1996,  due to an increase in printing
expense.  This increase  was  partially  offset  by  a decrease in the Illinois
Replacement Tax paid in 1997.

Marketing expenses to Affiliates increased for  the three and nine months ended
September 30, 1997, as compared  to  the  three and nine months ended September
30, 1996, due to increases  in  expenses  relating to marketing and advertising
the Partnership's  land  investments  for  sale.    Marketing  expenses to non-
affiliates increased for the nine months  ended September 30, 1997, as compared
to the nine months ended September 30,  1996, due to an increase in advertising
and travel expenses relating  to  marketing  the  land portfolio to prospective
purchasers.







                          PART II - Other Information

Items 1 through 5 are omitted because  of the absence of conditions under which
they are required.

Item 6.  Exhibits and Reports on Form 8-K

     (a) Exhibits:

         (27) Financial Data Schedule

     (b) Reports on Form 8-K:

         None











                                   -14-


                                  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.



                            INLAND CAPITAL FUND, L.P.

                            By:   Inland Real Estate Investment Corporation
                                  General Partner


                                  /S/ ROBERT D. PARKS

                            By:   Robert D. Parks
                                  Chairman
                            Date: November 12, 1997


                                  /S/ PATRICIA A. CHALLENGER

                            By:   Patricia A. Challenger
                                  Senior Vice President
                            Date: November 12, 1997


                                  /S/ KELLY TUCEK

                            By:   Kelly Tucek
                                  Principal Financial Officer and
                                  Principal Accounting Officer
                            Date: November 12, 1997






















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