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

                                    FORM 10-Q

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


For the  Quarterly  Period  Ended:  March 31,  Commission File Number: 0-20707
1997


                       COLONIAL REALTY LIMITED PARTNERSHIP
             (Exact name of registrant as specified in its charter)



                Alabama                               63-1098468
        (State of organization)                      (IRS Employer
                                                Identification Number)

        2101 Sixth Avenue North                          35203
               Suite 750                              (Zip Code)
          Birmingham, Alabama
(Address of principal executive offices)

                                (205) 250-8700
             (Registrant's telephone number, including area code)



      Indicate by check mark  whether the  Registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant  was required to file such  reports) and (2) has been subject to such
filing requirements for the past 90 days. YES x NO ___







<PAGE>


                       COLONIAL REALTY LIMITED PARTNERSHIP

                               INDEX TO FORM 10-Q


                                                                            Page

PART I:  FINANCIAL INFORMATION

      Item 1.  Financial Statements (Unaudited)

               Consolidated Condensed Balance Sheets as of
               March 31, 1997 and December 31, 1996                        3

               Consolidated Condensed Statements of Income for the
               Three Months Ended March 31, 1997 and 1996                  4

               Consolidated Condensed Statements of Cash Flows
               for the Three Months Ended March 31, 1997 and 1996          5

               Notes to Consolidated Condensed Financial Statements        6

               Report of Independent Accountants                           8

      Item 2.  Management's Discussion and Analysis of Financial           9
            Condition and Results of Operations

PART II:  OTHER INFORMATION


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

SIGNATURES                                                                 11

EXHIBITS                                                                   12





                                     Page 2
<PAGE>

                       COLONIAL REALTY LIMITED PARTNERSHIP
                      CONSOLIDATED CONDENSED BALANCE SHEETS
                                 (in thousands)
                             --------------------


                                             March 31, 1997
                                              (Unaudited)    December 31, 1996
                                           ----------------  -----------------
ASSETS

Land, buildings, & equipment, net           $      866,066      $      801,798
Undeveloped land and construction in progress      125,263             113,689
Cash and equivalents                                 2,282               3,340
Restricted cash                                      2,568               2,450
Accounts receivable, net                             4,815               4,779
Prepaid expenses                                     2,782               4,468
Notes receivable                                       570                 584
Deferred debt and lease costs, net                   6,803               6,288
Investments                                          5,086               5,028
Other assets                                         5,402               5,523
                                           ----------------   -----------------

                                             $   1,021,637      $      947,947
                                           ================   =================


LIABILITIES AND PARTNERS' CAPITAL

Notes and mortgages payable                 $      534,927      $      506,435
Accounts payable                                     6,421               7,451
Accounts payable to affiliates                       9,730               9,973
Accrued interest                                     4,946               5,465
Accrued expenses                                     4,268               1,585
Tenant deposits                                      3,156               2,926
Unearned rent                                          929                 924
                                           ----------------   -----------------

    Total liabilities                              564,377             534,759
                                           ----------------   -----------------

Minority interest in consolidated
     operating property                              3,255                 -0-
                                           ----------------   -----------------

Redeemable units, at redemption value              245,707             256,098
                                           ----------------   -----------------

Partners' capital, excluding redeemable units      208,298             157,090
                                           ----------------   -----------------

                                             $   1,021,637      $      947,947
                                           ================   =================


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

                                     Page 3
<PAGE>

                       COLONIAL REALTY LIMITED PARTNERSHIP
                   CONSOLIDATED CONDENSED STATEMENTS OF INCOME
                                   (Unaudited)
                      (in thousands, except per unit data)
                               ---------------------



                                                      Three Months Ended
                                                            March 31,
                                                --------------------------
                                                     1997           1996
                                                --------------------------

 Revenue:
      Minimum rent                              $    33,660   $    25,742
      Percentage rent                                   322           264
      Tenant recoveries                               3,420         2,221
      Other                                           1,768         1,380
                                             ---------------- ------------

          Total revenue                              39,170        29,607
                                             ---------------- ------------

 Property operating expenses:
      General operating expenses                      2,668         2,351
      Salaries and benefits                           2,274         1,853
      Repairs and maintenance                         3,580         2,827
      Taxes, licenses, and insurance                  3,618         2,671
 General and administrative                           1,213           838
 Depreciation                                         6,669         4,748
 Amortization                                           354           547
                                             ---------------- ------------

          Total operating expenses                   20,376        15,835
                                             ---------------- ------------

          Income from operations                     18,794        13,772
                                             ---------------- ------------

 Other income (expense):
      Interest expense                               (8,488)       (5,090)
      Income from subsidiaries                           40            (2)
      Losses from sales of property                      (1)           -0-
      Minority interest in consolidated
          operating property                            (56)           -0-
                                             ---------------- ------------

          Total other expense                        (8,505)       (5,092)
                                             ---------------- ------------

         Income before extraordinary item            10,439         8,815

 Extraordinary loss from early
     extinguishment of debt                            (384)         (319)
                                             ---------------- ------------

         Net income                             $    10,055   $     8,496
                                             ================ ============

 Net income per unit                            $      0.37   $      0.34
                                             ================ ============

 Weighted average units outstanding                  27,112        24,669
                                             ================ ============

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

                                     Page 4
<PAGE>

                       COLONIAL REALTY LIMITED PARTNERSHIP
                 CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
                                 (in thousands)
                               -------------------

                                                Three Months Ended
                                                     March 31,
                                          --------------------------------------
                                                1997                   1996
                                          ----------------      ----------------

 Cash flows from operating activities:
     Net  income                             $     10,055       $      8,496
     Adjustments to reconcile net
       income to net cash provided
         by operating activities:
         Depreciation and amortization              7,023              5,295
         Income from partnerships                    (190)              (133)
         Minority interest in income of
          property partnership                         56                 -0-
         Other                                        543                 48

     Decrease (increase) in:
         Restricted cash                             (118)               (12)
         Accounts receivable                         (253)               679
         Prepaid expenses                             581                259
         Other assets                                 142               (497)

     Increase (decrease) in:
         Accounts payable                          (1,030)             1,845
         Accrued interest                            (519)              (262)
         Accrued expenses and other                  (793)             1,847
                                            --------------   ----------------
            Net cash provided by
               operating activities                15,497             17,565
                                            --------------   ----------------

 Cash flows from investing activities:
     Acquisition of properties                    (19,393)                -0-
      Development expenditures                    (31,991)           (24,710)
     Tenant improvements                             (471)               (95)
     Capital expenditures                          (1,147)              (619)
     Distributions from partnerships                  253                207
     Capital contributions to partnerships           (121)                (3)
                                            --------------   ----------------
            Net cash used in investing
               activities                         (52,870)           (25,220)
                                            --------------   ----------------

 Cash flows from financing activities:
     Principal reductions of debt                 (24,789)            (8,982)
     Proceeds from additional borrowings           50,000                 -0-
     Net change in revolving credit balances      (17,306)           (70,692)
     Cash contributions                            43,919            106,919
     Capital distributions                        (14,322)           (12,889)
     Payment of mortgage financing cost              (803)               (34)
     Other, net                                      (384)                -0-
                                            --------------   ----------------
            Net cash provided by financing
               activities                          36,315             14,322
                                            --------------   ----------------
            Increase (decrease) in cash and
               equivalents                         (1,058)             6,667
 Cash and equivalents, beginning of period          3,340              1,585
                                            --------------   ----------------
 Cash and equivalents, end of period        $       2,282       $      8,252
                                            ==============   ================


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


                                     Page 5
<PAGE>

                       COLONIAL REALTY LIMITED PARTNERSHIP
                              NOTES TO CONSOLIDATED
                         CONDENSED FINANCIAL STATEMENTS
                                 March 31, 1997
                                   (Unaudited)

Note 1 -- Basis of Presentation
        The accompanying  unaudited  consolidated condensed financial statements
of Colonial Realty Limited Partnership ("CRLP") have been prepared by management
in  accordance  with  generally  accepted  accounting   principles  for  interim
financial  reporting and in  conjunction  with the rules and  regulations of the
Securities  and  Exchange  Commission.   In  the  opinion  of  management,   all
adjustments  considered  necessary for a fair  presentation  have been included.
These financial  statements  should be read in conjunction  with the information
included  in CRLP's  Annual  Report as filed with the  Securities  and  Exchange
Commission on Form 10-K for the year ended  December 31, 1996.  The December 31,
1996 balance  sheet data  presented  herein was derived  from audited  financial
statements but does not include all disclosures  required by generally  accepted
accounting principles.

        In February  1997,  the  Financial  Accounting  Standards  Board  issued
Statement of Financial  Accounting Standards No. 128, "Earnings Per Share" (SFAS
128). SFAS 128 supersedes  existing  generally  accepted  accounting  principles
relative to the calculation of earnings per share (unit), is effective for years
ending after  December 15, 1997,  and requires  restatement  of all prior period
earnings  per  share  (unit)  information  upon  adoption.  Generally,  SFAS 128
requires a  calculation  of basic  earnings per share  (unit),  which takes into
consideration  income (loss) available to common shareholders  (unitholders) and
the  weighted  average  of  common  shares  (units)  outstanding.  SFAS 128 also
requires the  calculation  of a diluted  earnings per share (unit),  which takes
into effect the impact of all  additional  common shares (units) that would have
been  outstanding if all dilutive  potential  common shares (units)  relating to
options,  warrants, and convertible securities had been issued, as long as their
effect is dilutive,  with a related  adjustment  of income  available for common
shareholders (unitholders),  as appropriate. SFAS 128 requires dual presentation
of basic and diluted  earnings per share (unit) on the face of the  statement of
operations and requires a reconciliation of the numerator and denominator of the
basic earnings per share (unit) computation.  CRLP does not expect the effect of
its adoption of SFAS 128 to be material.

Note 2 -- Acquisitions
        In two  transactions  on January 1 and January 8, 1997,  CRLP acquired a
 73.05%  interest in an office park  comprised of eight  one-level  buildings in
 Birmingham,  Alabama.  The  purchase  price of $20.8  million was funded by the
 assumption  of $8.7 million in mortgage  debt,  the issuance of 25,163  limited
 partnership  units valued at $0.7 million,  and an advance on CRLP's  unsecured
 line of credit. The assets and liabilities,  and the results of operations, and
 cash flows of this property are  consolidated in CRLP's  financial  statements.
 The  remaining  26.95%  ownership  in this  property is  reflected as "minority
 interest  in  consolidated  operating  property"  in CRLP's  balance  sheet and
 statement of income, and is included in "minority interest" on CRLP's statement
 of cash flows.

        On March 24, 1997, CRLP acquired a community  shopping center in Athens,
 Georgia.  The  purchase  price  of  $22.2  million  was  financed  through  the
 assumption  of debt totaling  $11.9 million and an advance on CRLP's  unsecured
 line of credit.




                                     Page 6

<PAGE>

        Also on March 24, 1997,  CRLP  acquired a community  shopping  center in
 Birmingham, Alabama. The $3.0 million purchase price of the center was financed
 through  the  issuance  of 16,303  limited  partnership  units,  valued at $0.5
 million, and an advance on CRLP's unsecured line of credit.

        On April 1, 1997,  CRLP acquired a multifamily  community in Birmingham,
 Alabama.  The $20.5 million purchase price was financed through the issuance of
 57,072 limited  partnership  units,  valued at $1.6 million,  and an advance on
 CRLP's unsecured line of credit.

Note 3 -- Distribution
        On April 24, 1997, a cash  distribution was declared to partners of CRLP
in the amount of $0.52 per unit,  totaling $14.4 million.  The  distribution was
made to partners of record as of May 5, 1997, and will be paid on May 12, 1997.












                                     Page 7
<PAGE>


REPORT OF INDEPENDENT ACCOUNTANTS



To the Board of Directors
Colonial Properties Holding Company, Inc.:

      We have reviewed the accompanying  consolidated condensed balance sheet of
Colonial Realty Limited  Partnership (the  "Partnership")  as of March 31, 1997,
and the related  consolidated  condensed statements of income and cash flows for
the  three-month  periods  ended  March  31,  1997  and  1996.  These  financial
statements are the responsibility of the Partnership's management.

      We conducted our review in accordance  with  standards  established by the
American  Institute  of  Certified  Public  Accountants.  A  review  of  interim
financial  information consists principally of applying analytical procedures to
financial  data and making  inquiries of persons  responsible  for financial and
accounting matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the  expression  of an opinion  regarding the  financial  statements  taken as a
whole. Accordingly, we do not express such an opinion.

      Based on our review, we are not aware of any material  modifications  that
should be made to the accompanying  condensed  consolidated financial statements
for them to be in conformity with generally accepted accounting principles.

      We have previously audited, in accordance with generally accepted auditing
standards,  the  consolidated  balance  sheet as of December 31,  1996,  and the
related consolidated statements of operations, partners' capital, and cash flows
for the year then ended (not presented herein);  and in our report dated January
24, 1997, we expressed an unqualified  opinion on those  consolidated  financial
statements.  In our  opinion,  the  information  set  forth in the  accompanying
consolidated  condensed  balance sheet as of December 31, 1996, is fairly stated
in all  material  respects in relation to the  consolidated  balance  sheet from
which it has been derived.



                                                /s/ Coopers & Lybrand L.L.P.
                                                COOPERS & LYBRAND L.L.P.
Birmingham, Alabama
April 18, 1997






                                     Page 8

<PAGE>


                       COLONIAL REALTY LIMITED PARTNERSHIP


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

General
      The following  discussion  should be read in conjunction with management's
discussion and analysis of financial condition and results of operations and all
of the other information  appearing in the  Partnership's  1996 Annual Report as
filed with the  Securities  and  Exchange  Commission  on Form 10-K and with the
financial statements included therein and the notes thereto.

Results of  Operations  -- Three Months Ended March 31, 1997 and 1996 Revenue --
      Total revenue increased by $9,563,000, or 32.3%, for the
first  quarter  of 1997 when  compared  to the first  quarter  of 1996.  Of this
increase,  $8,148,000  represents  revenues generated by properties  acquired or
developed  during 1996 and 1997.  The  $1,415,000  remainder  of the increase in
revenues  when  comparing the first quarter of 1997 to the first quarter of 1996
represents an increase in rents charged to tenants.

      Operating Expenses -- Total operating expenses increased by $4,541,000, or
28.7%, for the first quarter of 1997 when compared to the first quarter of 1996.
Of this increase,  $3,922,000  represents  operating  expenses of the properties
acquired or developed during 1996 and 1997. Operating expenses also increased by
$170,000  due  to the  resolution  of  prior  reserves  for  certain  state  tax
contingencies  in the amount of $300,000  in the first  quarter of 1996 and only
$130,000 in the first quarter of 1997.

      Other Income and Expenses -- Interest expense increased by $3,398,000,  or
66.7%, for the first quarter of 1997 when compared to the first quarter of 1996.
Interest expense increased  $4,873,000 due to the increase in indebtedness which
was  incurred  to  finance   acquisition  and  development   activity,   net  of
indebtedness  which was repaid  through a portion of CRLP's  issuance of limited
partnership  units in January 1997.  Interest expense also decreased by $693,000
due to the capitalization of $1,254,000 in interest on construction expenditures
during the first  quarter of 1997  compared to $561,000  capitalized  during the
first quarter of 1996.

Liquidity and Capital Resources
      As of March 31, 1997, CRLP had one bank line of credit providing for total
borrowings of $125 million. The line, which is used by CRLP primarily to finance
property acquisitions and development,  bears interest at a rate ranging between
LIBOR plus 100 to LIBOR plus 150 basis points and expires in December  1998. The
balance outstanding on this line at March 31, 1997, was $31,509,000.

      Management intends to replace  significant  borrowings that may accumulate
under the bank line of credit with funds  generated  from the sale of additional
Units to Colonial  Properties  Holding  Company,  Inc. in connection with public
offerings  of  securities  by  Colonial   Properties  Trust,   and/or  permanent
financing, as market conditions permit. Management believes that these potential
sources of funds,  along with the  possibility  of issuing  limited  partnership
units in exchange  for  properties,  will provide CRLP with the means to finance
additional  acquisitions.  Management  anticipates that its net cash provided by
operations and its existing cash balances will provide the necessary  funds on a
short- and long-term basis to cover its operating expenses,  interest expense on
outstanding  indebtedness,  recurring  capital  expenditures,  and  dividends to
shareholders in accordance with Internal Revenue Code requirements applicable to
real estate investment trusts.

                                     Page 9

<PAGE>
                       COLONIAL REALTY LIMITED PARTNERSHIP
                          PART II -- OTHER INFORMATION



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

      (a)  Exhibits

          12. Ratio of Earnings to Fixed Charges

          15. Letter re:  Unaudited Interim Financial Information

















                                     Page 10

<PAGE>

                                   SIGNATURES


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


                                COLONIAL REALTY LIMITED PARTNERSHIP,
                                  a Delaware limited partnership

                                 By: Colonial Properties Holding Company, Inc.,
                                     its general partner




Date:  May 8, 1997                       /s/ Howard B. Nelson, Jr.
                                         -------------------------
                                         Howard B. Nelson, Jr.
                                         Chief Financial Officer



Date:  May 8, 1997                       /s/ Howard B. Nelson, Jr.
                                         -------------------------
                                         Howard B. Nelson, Jr.
                                         Chief Financial Officer
                                        (Duly Authorized Officer
                                         and Principal Financial Officer)



Date:  May 8, 1997                       /s/ Kenneth E. Howell
                                         ----------------------
                                         Kenneth E. Howell
                                         Vice President, Controller,
                                         and Secretary
                                         (Principal Accounting Officer)









                                     Page 11
<PAGE>


                       COLONIAL REALTY LIMITED PARTNERSHIP
               EXHIBIT 12 - Ratio of Earnings to Fixed Charges



      CRLP's ratio of earnings to fixed charges for the three months ended March
31, 1997 and 1996, was 2.04 and 2.52, respectively.

      The ratios of earnings to fixed charges were computed by dividing earnings
by fixed  charges.  For this purpose,  earnings  consist of income (loss) before
gains from sales of property and extraordinary  items plus fixed charges.  Fixed
charges consist of interest expense  (including  interest costs capitalized) and
the amortization of debt issuance costs.


















                                    Page 12

<PAGE>
Securities and Exchange Commission
450 Fifth Street, N. W.
Washington, D. C. 20549



                                        Re: Colonial Realty Limited Partnership
                                           (File No. 0-20707)
                                            Registrations on Form S-3


We are aware  that our  report  dated  April 18,  1997 on our  review of interim
financial  information of Colonial  Realty Limited  Partnership for the quarters
ended March 31, 1997 and 1996 and included in the Company's  quarterly report on
Form 10-Q for the  quarters  then ended,  is  incorporated  by  reference in the
registration  statements on Form S-3 related to the Shelf Registrations filed on
July 5, 1996, and October 25, 1996. Pursuant to Rule 436(c) under the Securities
Act of 1933,  this report  should not be  considered a part of the  registration
statement prepared or certified by us within the meaning of Sections 7 and 11 of
that Act.




                                                /s/ Coopers & Lybrand L.L.P.
                                                COOPERS & LYBRAND L.L.P.
Birmingham, Alabama
May 8,1997














                                    Page 13