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


                        FORM 10-K


ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [NO FEE REQUIRED]

For the fiscal year ended       December 31, 1996

                           OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]

For the transition period from                  to

Commission file number                 0-14377

Krupp Realty Limited Partnership-VII
 (Exact name of registrant as specified in its charter)

       Massachusetts                   04-2842924
(State or other jurisdiction of         (IRS Employer
incorporation or organization)          Identification No.)

470 Atlantic Avenue, Boston, Massachusetts  02210
(Address of principal executive offices)      (Zip Code)

(Registrant's telephone number, including area code)  (617) 423-2233

Securities registered pursuant to Section 12(b) of the Act:None

Securities registered pursuant to Section 12(g) of the Act:Units of
Investor   Limited Partner  Interest

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 if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ ].

Aggregate market value of voting securities held by non-affiliates:  Not
applicable.

Documents incorporated by reference:  Part IV, Item 14.

The exhibit index is located on pages 9-12.

The total number of pages in this document is 30.
<PAGE>
                         PART I

This Form 10-K contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934.  Actual results could differ materially from those
projected in the forward-looking statements as a result of a number of
factors, including those identified herein.

ITEM 1. BUSINESS

Krupp Realty Limited Partnership-VII ("KRLP-VII") was formed on August 21,
1984 by filing a Certificate of Limited Partnership in The Commonwealth of
Massachusetts.  KRLP-VII issued all of the General Partner Interests to two
General Partners, The Krupp Corporation, a Massachusetts corporation, and
The Krupp Company Limited Partnership-II, a Massachusetts limited
partnership.  KRLP-VII also issued all of the Original Limited Partner
Interests to The Krupp Company Limited Partnership-II.  On November 2,
1984, KRLP-VII commenced an offering of up to 40,000 units of Investor
Limited Partner Interest (the "Units") for $1,000 per Unit.  The public
offering was closed on April 25, 1986, at which time 27,184 Units had been
sold. For additional details, see Note A to Consolidated Financial
Statements included in Item 8 (Appendix A) of this report.  The primary
business of KRLP-VII is to invest in, operate, refinance and ultimately
dispose of a diversified portfolio of residential and commercial real
estate.  KRLP-VII considers itself to be engaged only in the industry
segment of investment in real estate.

On December 19, 1984 the General Partners formed Krupp Realty Courtyards
Limited Partnership ("Realty-VII") as a prerequisite for the refinancing of
Courtyards Village East Apartments ("Courtyards").  At the same time, the
General Partners transferred ownership of Courtyards to Realty-VII.  The
General Partner of Realty-VII is The Krupp Corporation ("Krupp Corp.").
The Limited Partner of Realty-VII is KRLP-VII.  Krupp Corp. has
beneficially assigned its interest in Realty-VII to KRLP-VII.

On March 31, 1994, the General Partners formed Windsor Partners Limited
Partnership ("Windsor L.P.") as a prerequisite for the refinancing of
Windsor Apartments.  At the same time, the General Partners transferred
ownership of the property to Windsor L.P.  In exchange for the property,
KRLP-VII received 99% Limited Partnership interest in Windsor L.P.  The
General Partner of Windsor L.P. is ST. Windsor Corporation which has a 1%
interest in Windsor L.P. and is 100% owned by KRLP-VII.

KRLP-VII, Realty-VII and Windsor L.P. are collectively known as Krupp
Realty Limited Partnership-VII and Subsidiaries (collectively referred to
herein as the "Partnership").

The Partnership's real estate investments are subject to some seasonal
fluctuations due to changes in utility consumption and seasonal maintenance
expenditures.  However, the future performance of the Partnership will
depend upon factors which cannot be predicted.  Such factors include
general economic and real estate market conditions, both on a national
basis and in those areas where the Partnership's real estate investments
are located, the availability and cost of borrowed funds, real estate tax
rates, operating expenses, energy costs, government regulations and federal
and state income tax laws.  The requirements for compliance with federal,
state and local regulations to date have not had an adverse affect on the
Partnership's operations, and no adverse affect therefrom is anticipated in
the future.

The Partnership's investments in real estate are also subject to such risks
as (i) competition from existing and future projects held by other owners
in the locations of the Partnership's properties, (ii) possible reduction
in rental income due to an inability to maintain high occupancy levels, the
financial failure of a tenant or the inability of retail tenants to achieve
gross sales at a level sufficient to provide for additional rental income
based on a percentage of sales, (iii) possible adverse changes in mortgage
interest rates, (iv) possible adverse changes in general economic and local
conditions, such as competitive over-building, increases in unemployment,
or adverse changes in real estate zoning laws, (v) the possible future
adoption of rent control legislation which would not permit the full amount
of increased costs to be passed on to tenants in the form of rent
increases, and (vi) other circumstances over which the Partnership may have
little or no control.

As of December 31, 1996, there were approximately 30 full and part-time
on-site personnel employed by the Partnership.

ITEM 2.   PROPERTIES

As of December 31, 1996, the Partnership has leveraged investments in two
apartment complexes having an aggregate of 524 units and one commercial
shopping center with 89,432 square feet of leasable space.

A summary of the Partnership's real estate investments is presented below.
Schedule III included in Item 8 (Appendix A) to this report contains
additional detailed information with respect to individual properties.

<TABLE>
<CAPTION>
                                             Average Occupancy
                               Total Units/ For the Year Ended
                     Year of Current Leasable       December 31,
Description        Acquisition Square Footage  1996 1995 1994 1993 1992

Residential

<S>                      <C>     <C>        <C> <C>   <C> <C>   <C>
Courtyards Village East
 Apartments
Naperville, Illinois     1985    224 Units  98%  95%  97%  96%  93%

Windsor Apartments
Garland, Texas          1984     300 Units  96%  95%  94%  92%  93%

Commercial

Nora Corners Shopping
 Center
Indianapolis, Indiana     198689,432 Sq. Ft.  94%  93%  93%  93%  95%
</TABLE>
There were two tenants at Nora Corners occupying 10% or more of the
Partnership's leasable space as of December 31, 1996.

ITEM 3.LEGAL PROCEEDINGS
       There are no material pending legal proceedings to which the
Partnership is a party or of which any of its property is the subject.


ITEM 4.SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

       None.

                         PART II

ITEM 5.MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED
       STOCKHOLDER MATTERS

The transfer of Units is subject to certain limitations contained in the
Partnership Agreement.  There is no public market for the Units and it is
not anticipated that any such public market will develop.


The number of Investor Limited Partners as of December 31, 1996 was
approximately 1,500.

One of the objectives of the Partnership is to generate cash available for
partially tax sheltered distributions.  The Partnership discontinued
distributions during 1989 due to insufficient operating Cash Flow.  In
1994, however, the General Partners determined that there was sufficient
Cash Flow to reinstate distributions.  These distributions commenced in
August 1994 and thereafter are to be paid semiannually.

The Partnership made the following distributions to its Partners during the
years ended December 31, 1996 and 1995:
<TABLE>
<CAPTION>


                                 Year Ended December 31,
                              1996                    1995
                         Amount   Per Unit      AmountPer Unit
Limited Partners:

 <S>                    <C>      <C>        <C>       <C>
 Investor Limited Partners
    (27,184 Units
    outstanding)        $543,679 $20.00     $543,679  $20.00

 Original Limited Partner  48,327             48,327

General Partners          12,082              12,082

                        $604,088            $604,088
</TABLE>
<PAGE>
ITEM 6.     SELECTED FINANCIAL DATA

The following table sets forth selected financial information regarding the
Partnership's financial position and operating results.  This information
should be used in conjunction with Management's Discussion and Analysis of
Financial Condition and Results of Operations and the Consolidated
Financial Statements and Notes thereto, which are included in Items 7 and 8
of this report, respectively.
<TABLE>
<CAPTION>

                     1996        1995       1994      1993        1992

<S>               <C>         <C>          <C>        <C>        <C>
Total revenue     $ 4,688,515 $ 4,537,418$ 4,286,787$ 4,799,476$ 5,396,406

Income (loss) before
  gain on sale of
  property             10,513     (24,601)   (409,938)   (789,506)   (994,525)

Gain on sale of
  property               -           -          -       843,368       -

Net income (loss)      10,513     (24,601)   (409,938)     53,862   (994,525)

Net income (loss)
  allocated to:

  Investor Limited
     Partners           9,462     (24,355)   (405,839)     53,323   (984,580)
       Per Unit           .35        (.90)     (14.93)       1.96     (36.22)

  Original Limited
     Partner              841        -          -          -          -

  General Partners        210        (246)     (4,099)        539     (9,945)

Total assets at
  December 31,     16,855,594  17,611,547 18,358,061 18,751,190 24,239,479

Long-term obligations
  at December 31,  12,366,197  12,563,382 12,745,312  8,364,761 17,226,999

Distributions to:
  Investor Limited
     Partners         543,679     543,679    135,920       -          -
       Per Unit         20.00       20.00       5.00       -          -

  Original Limited
     Partner           48,327      48,327     12,082       -          -

  General Partners     12,082      12,082      3,020       -          -
</TABLE>
Operating results for the periods presented are not comparable due to the
sale of Westbrook Place and Willow Cove Apartments on July 1, 1993.

Prior performance of the Partnership is not necessarily indicative of
future operations.
<PAGE>
ITEM 7.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
            CONDITION AND RESULTS OF OPERATIONS

  This Management's Discussion and Analysis of Financial Condition and
Results of Operations contains forward-looking statements including those
concerning Management's expectations regarding the future financial
performance and future events.  These forward-looking statements involve
significant risk and uncertainties, including those described herein.
Actual results may differ materially from those anticipated by such
forward-looking statements.

Liquidity and Capital Resources

  The Partnership's ability to generate cash adequate to meet its needs
is dependent primarily upon the operations of its real estate investments.
Such ability would also be impacted by the future availability of bank
borrowings and the future refinancing and sale of the Partnership's
remaining real estate investments.  These sources of liquidity will be used
by the Partnership for payment of expenses related to real estate
operations, capital improvements, debt service and other expenses.  Cash
Flow, if any, as calculated under Section 8.2(a) of the Partnership
Agreement, will then be available for distribution to the Partners.  In
1994, the General Partners determined that there was sufficient Cash Flow
to reinstate semiannual distributions.  These distributions commenced in
August 1994 at a rate of $5.00 per Unit and increased in February 1995 to a
rate of $20.00 per Unit.

  The Partnership's properties, Courtyards Village, Nora Corners and
Windsor Apartments, generated increased liquidity due to higher rental
rates and increased occupancy in 1996.  Also contributing to the
improvement in cash flow from operations are the lower interest rates and
reduced mortgage payments which resulted from refinancing the Partnership's
mortgage notes on Windsor Apartments and Nora Corners in 1994.  The
Partnership used this increased liquidity to fund capital improvements of
approximately $700,000 in 1996.  Currently, management is reviewing
refinancing options for the Courtyards Village mortgage note.  Increased
liquidity which may result from this refinancing will be used to fund
capital improvements at the Partnership's properties. Approximately
$1,200,000 in fixed asset expenditures are anticipated in 1997 in order to
improve the appearance of the properties and allow them to remain
competitive in their respective markets.

Cash Flow

  Shown below, as required by the Partnership Agreement, is the
calculation of Cash Flow of the Partnership for the year ended December 31,
1996.  The General Partners provide certain of the information below to
meet requirements of the Partnership Agreement and because they believe
that it is an appropriate supplemental measure of operating performance.
However, Cash Flow should not be considered by the reader as a substitute
to net income (loss), as an indicator of the Partnership's operating
performance or to cash flows as a measure of liquidity.
<TABLE>
<CAPTION>
                                           Rounded to $1,000

 <S>                                        <C>
 Net loss for tax purposes                  $         (24,000)

 Items not requiring (requiring) the use of
    operating funds:
      Tax basis depreciation and amortization        1,363,000
      Principal payments on mortgage notes
         payable                                     (182,000)
      Capital improvement expenditures               (692,000)
      Releases from working capital reserves          139,000

 Cash Flow                                  $         604,000
</TABLE>
Operations
The following discussion relates to the operations of the Partnership and
its properties, Courtyards Village, Nora Corners and Windsor Apartments for
the years ended December 31, 1996, 1995, and 1994.

1996 compared to 1995

Cash Flow for 1996, before releases from working capital reserves,
decreased when compared to 1995 due primarily to increased capital
improvements at the two residential properties, Windsor Apartments and
Courtyards Village, for exterior painting in 1996.  Overall, net income
improved in 1996 when compared to 1995, as the increase in total revenue
more than offset the increase in total expenses.  Moderate rental rate
increases at Windsor Apartments and Courtyards Village, along with average
occupancy increases at all the Partnership's properties in 1996 when
compared to 1995, contributed to the overall increase in rental revenue in
1996.  Interest income increased due to additional investments in
commercial paper yielding higher rates of return.

Total expenses increased in 1996 as compared to 1995.  This increase is
attributable to a rise in both operating and real estate tax expenses.
Operating expense increased as utility consumption during the first quarter
of 1996 increased due to severe weather conditions in the Chicago area.
Additionally, extensive advertising for Courtyards Village further
contributed to this rise in operating expense and allowed Courtyards to
achieve and maintain its high level of occupancy.  Real estate taxes
increased as a result of a reassessment of Windsor Apartments' property
value in 1996 by the local taxing authority.  These increases in operating
and real estate tax expenses are partially offset by a decrease in general
and administrative expense due to legal and consulting fees paid for the
appraisals of the properties in 1995.  Depreciation expense increased in
conjunction with the increase in capital improvements, which were performed
to enhance the appearance of the Partnership's properties.

1995 compared to 1994
During 1995 as compared to 1994, cash flow increased 60% due to increases
in rental revenues and reduced operating and interest expense.  Rental
revenues increased primarily due to steady rental rate increases
implemented at Courtyards and Windsor in 1994.  The Partnership's
commercial property, Nora Corners, maintained its high level of occupancy
with the signing of two new tenants in the first quarter of 1994, D.L.
Lowry Salon, a hair salon, and Food King, a Chinese food restaurant, and
one new tenant in the second quarter of 1995, After All, a women's clothing
store.  In addition, the Accent Shop, a home retail store, renewed its
lease.  Interest income increased due to additional investments in
commercial paper yielding higher rates of return.

During 1995 as compared to 1994, overall expenses decreased.  The decrease
in operating expense is primarily due to a reduction in insurance expense
due to a favorable claim history as well as management's efforts to reduce
reimbursable operating costs.  Interest expense decreased due to the
refinancing of the mortgage notes payable at Windsor Apartments and Nora
Corners in April and October of 1994, respectively.  The refinanced
mortgage note at Windsor has an interest rate of 9.25% per annum, reduced
from the previous rate of 10.3% per annum.  At Nora Corners, the refinanced
mortgage note has an interest rate of 9% per annum, reduced from the
previous rate of 10.5% per annum.  Maintenance expense increased due to
landscaping, parking lot and exterior building improvements implemented at
Courtyards and Windsor primarily during the third and fourth quarters of
1995.  General and administrative expenses increased due to legal and
consulting fees paid for the appraisals of the properties.

General

In accordance with Financial Accounting Standard No. 121, "Accounting for
the Impairment of Long-Lived Assets and for Long-Lived Assets to Be
Disposed Of", which is effective for fiscal years beginning after December
15, 1995, the Partnership has implemented policies and practices for
assessing impairment of its real estate assets.

The investments in properties are carried at cost less accumulated
depreciation unless the General Partners believe there is a material
impairment in value, in which case a provision to write down investments in
properties to fair value will be charged against income.  At this time, the
General Partners do not believe that any assets of the Partnership are
materially impaired.

ITEM 8.FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

See Appendix A to this report.

ITEM 9.CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE None.

PART III

ITEM 10.DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The Partnership has no directors or executive officers.  Information as to
the directors and executive officers of The Krupp Corporation, which is a
General Partner of KRLP-VII, and The Krupp Company Limited Partnership-II,
the other General Partner of KRLP-VII, is as follows:

                                Position with
      Name and Age              The Krupp Corporation

      Douglas Krupp (50)        Co-Chairman of the Board
      George Krupp (52)         Co-Chairman of the Board
      Laurence Gerber (40)      President
      Robert A. Barrows (39)    Treasurer

Douglas Krupp is Co-Chairman and Co-Founder of The Berkshire Group.
Established in 1969 as the Krupp Companies, this real estate-based firm
expanded over the years within its areas of expertise including investment
program sponsorship, property and asset management, mortgage banking,
healthcare facility ownership and the management of the Company.  Today,
The Berkshire Group is an integrated real estate, mortgage and healthcare
company which is headquartered in Boston with regional offices throughout
the country.  A staff of approximately 3,400 are responsible for the more
than $4 billion under management for institutional and individual clients.
Mr. Krupp is a graduate of Bryant College.  In 1989 he received an honorary
Doctor of Science in Business Administration from this institution and was
elected trustee in 1990. Mr. Krupp is Chairman of the Board and a Director
of both Berkshire Realty Company, Inc. (NYSE-BRI) and Harborside Healthcare
(NYSE-HBR).  George Krupp is Douglas Krupp's brother.

George Krupp is the Co-Chairman and Co-Founder of The Berkshire Group.
Established in 1969 as the Krupp Companies, this real estate-based firm
expanded over the years within its areas of expertise including investment
program sponsorship, property and asset management, mortgage banking and
healthcare facility ownership.  Today, The Berkshire Group is an integrated
real estate, mortgage and healthcare company which is headquartered in
Boston with regional offices throughout the country.  A staff of
approximately 3,400 are responsible for more than $4 billion under
management for institutional and individual clients.  Mr. Krupp attended
the University of Pennsylvania and Harvard University.  Mr. Krupp also
serves as Chairman of the Board and Trustee of Krupp Government Income
Trust and as Chairman of the Board and Trustee of Krupp Government Income
Trust II.

Laurence Gerber is the President and Chief Executive Officer of The
Berkshire Group.  Prior to becoming President and Chief Executive Officer
in 1991, Mr. Gerber held various positions with The Berkshire Group which
included overall responsibility at various times for:  strategic planning
and product development, real estate acquisitions, corporate finance,
mortgage banking, syndication and marketing.  Before joining The Berkshire
Group in 1984, he was a management consultant with Bain & Company, a
national consulting firm headquartered in Boston.  Prior to that, he was a
senior tax accountant with Arthur Andersen & Co., an international
accounting and consulting firm.  Mr. Gerber has a B.S. degree in Economics
from the University of Pennsylvania, Wharton School and an M.B.A. degree
with high distinction from Harvard Business School.  He is a Certified
Public Accountant.  Mr. Gerber also serves as Director of Berkshire Realty
Company, Inc. (NYSE-BRI) and Harborside Healthcare Corporation (NYSE-HBR)
as well as President and Trustee of  Krupp Government Income Trust and
President and Trustee of Krupp Government Income Trust II.

Robert A. Barrows is Senior Vice President and Chief Financial Officer
of  The Berkshire Group.  Mr. Barrows has held several positions within The
Berkshire Group since joining the company in 1983 and is currently
responsible for accounting and financial reporting, treasury, tax, payroll
and office administrative activities.  Prior to joining The Berkshire
Group, he was an audit supervisor for Coopers & Lybrand  L.L.P. in Boston.
He received a B.S. degree from Boston College and is a Certified Public
Accountant.

ITEM 11.EXECUTIVE COMPENSATION

The Partnership has no directors or executive officers.

ITEM 12.SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

As of December 31, 1996, beneficial owners of record owning more than 5%
of the Partnerships 27,184 outstanding Units are as follows:

  Title         Name and Address   Amount and Nature  Percent
   of                  of                 of           of
  Class         Beneficial Owner  Beneficial OwnershipClass

   Investor     Mark S. Thompson      1,639 Units      6.03%
   Limited    c/o Equity Resources
 Partner           Group, Inc.
  Units         14 Story Street
              Cambridge, MA 02138

The only interests held by management or its affiliates consist of its
General Partner and Original Limited Partner Interests.

ITEM 13.CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The Partnership does not have any directors, executive officers or
nominees for election as director.

                         PART IV


ITEM 14.EXHIBITS, CONSOLIDATED FINANCIAL STATEMENT SCHEDULES AND REPORTS
    ON FORM 8-K

(a)1. Consolidated Financial Statements - see Index to Consolidated
      Financial Statements and Schedule included under Item 8
      (Appendix A), on page F-2 to this report.

2.    Consolidated Financial Statement Schedules - see Index to
      Consolidated Financial Statements and Schedule included under
      Item 8 (Appendix A), on page F-2 to this report.  All other
      schedules are omitted as they are not applicable or not
      required or the information is provided in the Consolidated
      Financial Statements or the Notes thereto.
(b)Exhibits:

  Number and Description
  Under Regulation S-K

  The following reflects all applicable exhibits required under Item
  601 of Regulation S-K:

(4)Instruments defining the rights of security holders including
  indentures:

(4.1)Amended Agreement of Limited Partnership dated as of October 23,
    1984 [Exhibit A to Prospectus included in Registrant's
    Registration Statement on Form S-11 (File 2-92889)].*

(4.2)Thirty-Second Amendment and Restatement of Certificate of Limited
    Partnership filed with the Massachusetts Secretary of State on
    June 4, 1986 [Exhibit 4.2 to Registrant's Report on Form 10-K
    dated October 31, 1986 (File No. 0-14377)].*

(10)Material Contracts

          Windsor Apartments

(10.1)Purchase and Sale Agreement dated June 3, 1983 between Douglas
    Krupp, on behalf of himself and others, and Garland Land Joint
    Venture [Exhibit 1 to Registrant's Report on Form 8-K dated
    December 27, 1984 (File No. 2-92889)].*

(10.2)Management Agreement dated December 27, 1984 between Krupp Realty
    Limited Partnership-VII, as Owner and Krupp Asset Management
    Company, now known as Berkshire Property Management ("BPM"), as
    Agent. [Exhibit 10.4 to Registrant's Report on Form 10-K for the
    fiscal year ended October 31, 1984 (File No. 2-92889)].*

(10.3)Promissory Note dated April 13, 1994 by and between Windsor
    Partners Limited Partnership and Sun Life Insurance Company of
    America [Exhibit 10.1 to Registrant's Report on Form 10-Q dated
    June 30, 1994 (File No. 0-14377)].*

(10.4)Deed of Trust, Security Agreement, Fixture Filing, Financing
    Statement and Assignment of Leases and Rents dated April 13, 1994
    from the grantor, Windsor Partners Limited Partnership, to the
    Trustee, Brian C. Rider [Exhibit 10.2 to Registrant's Report on
    Form 10-Q dated June 30, 1994 (File No. 0-14377)].*

          Courtyards Village East Apartments
(10.5)Purchase and Sale Agreement dated October 12, 1984 between Douglas
    Krupp on behalf of himself and others, and The Courtyards Village
    and The Courtyards Village Inn-East Apartments Partnership
    [Exhibit 1 to Registrant's Report on Form 8-K dated April 1, 1985
    (File 2-92889)].*

(10.6)Amended Trust Agreement dated May 6, 1976 between The Courtyards
    Village and The Courtyards Village Inn-East Apartments Partnership
    and American National Bank and Trust Company of Chicago [Exhibit 2
    to Registrant's Report on Form 8-K dated April 1, 1985 (File No.
    2-92889)].*

(10.7)Assignment of Trust of American National Bank and Trust Company of
    Chicago dated April 1, 1985 [Exhibit 3 to Registrant's Report on
    Form 8-K dated April 1, 1985 (File No. 2-92889)].*

(10.8)Mortgage Note dated January 1, 1973 between American National Bank
    and Trust Company of Chicago and Republic Realty Mortgage Company
    [Exhibit 4 to Registrant's Report on Form 8-K dated April 1, 1985
    (File No. 2-92889)].*


(10.9)Modification Agreement dated May 1, 1975 between American National
    Bank and Trust Company of Chicago and Republic Realty Mortgage
    Corporation. [Exhibit 5 to Registrant's Report on Form 8-K dated
    April 1, 1985 (File No. 2-92889)].*

(10.10)Mortgage Note dated May 18, 1976 between American National Bank
    and Trust Company of Chicago and Republic Realty Mortgage Company
    [Exhibit 6 to Registrant's Report on Form 8-K dated April 1, 1985
    (File No. 2-92889)].*

(10.11)Mortgage Agreement dated May 18, 1976 between American National
    Bank and Trust Company of Chicago and Republic Realty Mortgage
    Corporation [Exhibit 7 to Registrant's Report on Form 8-K dated
    April 1, 1985 (File No. 2-92889)].*

(10.12)Amended HUD Regulatory Agreement dated May 18, 1976 between
    American National Bank and Trust Company of Chicago and Republic
    Realty Mortgage Corporation [Exhibit 8 to Registrant's Report on
    Form 8-K dated April 1, 1985 (File No. 2-92889)].*

(10.13)Consolidation Agreement dated June 14, 1976 between American Bank
    and Trust Company of Chicago, as Trustee, and Republic Realty
    Mortgage Corporation [Exhibit 9 to Registrant's Report on Form 8-K
    dated April 1, 1985  (File No. 2-92889)].*

(10.14)Management Agreement dated April 1, 1985 between Krupp Realty
    Limited Partnership-VII, as Owner and Krupp Asset Management
    Company, now known as Berkshire Property Management ("BPM"), as
    Agent.  {Exhibit 10.20 to Registrant's Report on Form 10-K for the
    year ended October 31, 1985 (File No. 2-92889)].*

       Nora Corners Shopping Center

(10.15)Purchase and Sale Agreement dated June 16, 1986 between Douglas
    Krupp, on behalf of himself and others and Nora Corners Building
    Associates, Ltd., an Illinois limited partnership [Exhibit 1 to
    Registrant's Report on Form 8-K dated September 24, 1986 (File No.
    0-14377)].*

(10.16)Amendment to Purchase and Sale Agreement dated August 29, 1986
    between Douglas Krupp, on behalf of himself and others (assigned
    to Krupp Realty Limited Partnership-VII), and Nora Corners
    Building Associates, Ltd., an Illinois limited partnership
    [Exhibit 2 to Registrant's Report on Form 8-K dated September 24,
    1986 (File No. 0-14377)].*

   (10.17)Property Management Agreement dated September 24, 1986
                between Krupp Realty Limited Partnership-VII, as Owner
                and Krupp Asset Management Company, now known as
                Berkshire Property Management ("BPM"), as Agent [Exhibit
                10.36 to Registrant's Report on Form 10-K dated October
                31, 1987 (File No. 0-14377)].*

         (10.18)Special Warranty Deed dated September 24, 1986 between
                Krupp Realty Limited Partnership-VII and Nora Corners
                Building Associates, Ltd., an Illinois limited
                partnership [Exhibit 8 to Registrant's Report on Form 8-K
                dated September 24, 1986 (File No. 0-14377)].*

         (10.19)Land Lease dated October 11, 1962 between Cornelius M.
                and Wilma Brown (lessor) and Burger Chef Systems, Inc.,
                an Indiana corporation (lessee) [Exhibit 9 to
                Registrant's Report on Form 8-K dated September 24, 1986
                (File No. 0-14377)].*

         (10.20)Notice of Lease dated September 23, 1963 between
                Cornelius M. and Wilma Brown (lessor) and Burger Chef
                Systems, Inc., an Indiana corporation (lessee) [Exhibit
                10 to Registrant's Report on Form 8-K dated September 24,
                1986 (File No. 0-14377)].*

         (10.21)Assignment of Lease dated September 24, 1986 between
                Krupp Realty Limited Partnership-VII and Nora Corners
                Building Associates, Ltd., an Illinois limited
                partnership [Exhibit 11 to Registrant's Report on Form 8-
                K dated September 24, 1986 (File No. 0-14377)].*

         (10.22)Promissory Note dated September 27, 1994, effective
                October 6, 1994, by and between Krupp Realty Limited
                Partnership-VII and John Hancock Mutual Life Insurance
                Company. [Exhibit 10.22 to Registrant's Report on Form
                10-K dated December 31, 1994 (File No. 0-14377)].*

         (10.23)Mortgage, Security Agreement, Assignment of Leases and
                Fixture Filing dated September 27, 1994, effective
                October 6, 1994,  by and between Krupp Realty Limited
                Partnership-VII and John Hancock Mutual Life Insurance
                Company. [Exhibit 10.23 to Registrant's Report on Form
                10-K dated December 31, 1994 (File No. 0-14377)].*

         * Incorporated by reference

(c)  Reports on Form 8-K

During the last quarter of the year ended December 31, 1996, the
Partnership did not file any reports on Form 8-K.
<PAGE>
                          SIGNATURES


Pursuant to the requirements of Section 13 or 15(d) 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, on the
27th day of March, 1997.

                            KRUPP REALTY LIMITED PARTNERSHIP-VII
                            By: The Krupp Corporation, a General
                                Partner



                            By: /s/Douglas Krupp
                                Douglas Krupp, Co-Chairman
                                (Principal Executive Officer)
                                and Director of the Krupp Corporation



Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities indicated, on the 27th day of March, 1997.

Signatures      Titles




/s/Douglas Krupp   Co-Chairman (Principal Executive Officer)
Douglas Krupp      and Director of The Krupp Corporation, a General
                   Partner.



/s/George Krupp    Co-Chairman (Principal Executive Officer)
George Krupp       and Director of The Krupp Corporation, a General
                   Partner.



/s/Laurence Gerber  President of The Krupp Corporation, a
Laurence Gerber        General Partner.



/s/Robert A. Barrows     Treasurer of The Krupp Corporation, a
Robert A. Barrows        General Partner.
<PAGE>


                       APPENDIX A

  KRUPP REALTY LIMITED PARTNERSHIP-VII AND SUBSIDIARIES




CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULE
ITEM 8 OF FORM 10-K

ANNUAL REPORT TO THE SECURITIES AND EXCHANGE COMMISSION
        For the Year Ended December 31, 1996
<PAGE>
KRUPP REALTY LIMITED PARTNERSHIP-VII AND SUBSIDIARIES

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULE





Report of Independent Accountants                       F-3


Consolidated Balance Sheets at December 31, 1996 and
December 31, 1995                                       F-4


Consolidated Statements of Operations for the Years Ended
December 31, 1996, 1995 and 1994                        F-5


Consolidated Statements of Changes in Partners' Equity for
the Years Ended December 31, 1996, 1995 and 1994        F-6


Consolidated Statements of Cash Flows for the Years Ended
December 31, 1996, 1995 and 1994                        F-7


Notes to Consolidated Financial Statements       F-8 - F-15


Schedule III - Real Estate and Accumulated DepreciationF-16 - F-17



All other schedules are omitted as they are not applicable, not required,
or the information is provided in the consolidated financial statements or
the notes thereto.
<PAGE>

                       REPORT OF INDEPENDENT ACCOUNTANTS

To the Partners of
Krupp Realty Limited Partnership-VII and Subsidiaries:

 We have audited the consolidated financial statements and the financial
statement schedule of Krupp Realty Limited Partnership-VII and Subsidiaries
(the "Partnership") listed in the index on page F-2 of this Form 10-K.
These financial statements and financial statement schedule are the
responsibility of the Partnership's management.  Our responsibility is to
express an opinion on these financial statements and financial statement
schedule based on our audits.

   We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement.  An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the consolidated
financial statements.  An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall consolidated financial statement presentation.  We
believe that our audits provide a reasonable basis for our opinion.

   In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the consolidated financial
position of Krupp Realty Limited Partnership-VII and Subsidiaries as of
December 31, 1996 and 1995 and the consolidated results of its operations
and its cash flows for each of the three years in the period ended December
31, 1996 in conformity with generally accepted accounting principles.  In
addition, in our opinion, the financial statement schedule referred to
above, when considered in relation to the basic financial statements taken
as a whole, presents fairly in all material respects, the information
required to be included therein.




Boston, Massachusetts        COOPERS & LYBRAND L.L.P.
January 24, 1997
<PAGE>     KRUPP REALTY LIMITED PARTNERSHIP-VII AND SUBSIDIARIES

                          CONSOLIDATED BALANCE SHEETS
                          December 31, 1996 and 1995


<TABLE>
<CAPTION>
                                    ASSETS
                                                        1996           1995

  <S>                                             <C>            <C>
  Real estate assets:
   Multi-family apartment complexes, net of
      accumulated depreciation of $10,420,771 and
      $9,521,601, respectively (Note D)           $ 8,770,063    $ 9,030,289
   Retail center, net of accumulated
      depreciation of $3,676,352 and $3,285,620,
      respectively (Notes D and H)                  6,038,521      6,376,225

           Total real estate assets                14,808,584     15,406,514

Cash and cash equivalents (Note C)                  1,177,332      1,311,037
Cash restricted for tenant security deposits           36,823         35,979
Replacement reserve escrow (Note D)                    52,009         57,462
Prepaid expenses and other assets                     584,929        568,775
Deferred expenses, net of accumulated
   amortization of $91,377 and $55,514,
   respectively (Note I)                              195,917        231,780


           Total assets                           $16,855,594    $17,611,547



                      LIABILITIES AND PARTNERS' EQUITY

Liabilities:
   Mortgage notes payable (Note D)                $12,562,165    $12,744,191
   Accounts payable                                     7,431         48,530
   Accrued expenses and other liabilities (Note E)    846,419        785,672

           Total liabilities                       13,416,015     13,578,393

Commitment (Note F)

Partners' equity (deficit) (Note F):
   Investor Limited Partners (27,184 Units
      outstanding)                                  4,072,663      4,606,880
   Original Limited Partner                          (384,948)      (337,462)
   General Partners                                  (248,136)      (236,264)

           Total Partners' equity                   3,439,579      4,033,154

           Total liabilities and Partners' equity $16,855,594    $17,611,547

</TABLE>



                    The accompanying notes are an integral
                part of the consolidated financial statements.
     <PAGE>
             KRUPP REALTY LIMITED PARTNERSHIP-VII AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF OPERATIONS
             For the Years Ended December 31, 1996, 1995 and 1994


<TABLE>
<CAPTION>
                                            1996         1995        1994

<S>                                     <C>          <C>          <C>
Revenue:
   Rental (Note G)                      $ 4,614,568  $ 4,470,378  $4,258,043
   Interest income                           73,947       67,040      28,744
      Total revenue                       4,688,515    4,537,418   4,286,787

Expenses:
   Operating (Notes H and I)              1,123,377    1,037,818   1,163,730
   Maintenance                              366,051      359,058     331,826
   Real estate taxes                        466,876      437,003     404,887
   General and administrative (Note I)       98,847      136,069      97,459
   Management fees (Note I)                 193,484      192,572     176,861
   Depreciation and amortization          1,325,765    1,281,398   1,293,815
   Interest (Note D)                      1,103,602    1,118,101   1,228,147

      Total expenses                      4,678,002    4,562,019   4,696,725

Net income (loss) (Note J)              $    10,513  $   (24,601) $(409,938)

Allocation of net income(loss)(Note F):

   Investor Limited Partners Interest
      (27,184 Units outstanding)        $     9,462  $   (24,355) $(405,839)

   Per Unit of Investor Limited
      Partner Interest                  $       .35  $      (.90) $  (14.93)

   Original Limited Partner             $       841  $      -     $     -

   General Partners                     $       210  $      (246) $  (4,099)
</TABLE>

The accompanying notes are an integral
                part of the consolidated financial statements.
<PAGE>
             KRUPP REALTY LIMITED PARTNERSHIP-VII AND SUBSIDIARIES

            CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' EQUITY
             For the Years Ended December 31, 1996, 1995 and 1994


<TABLE>
<CAPTION>
                         Investor      Original                    Total
                          Limited       Limited        General     Partners'
                          Partners      Partner       Partners      Equity


<S>                    <C>            <C>            <C>         <C>
Balance at
   December 31, 1993   $5,716,673     $(277,053)     $(216,817)  $5,222,803

Distributions            (135,920)      (12,082)        (3,020)    (151,022)

Net loss                 (405,839)         -            (4,099)    (409,938)

Balance at
   December 31, 1994    5,174,914      (289,135)      (223,936)   4,661,843

Distributions            (543,679)      (48,327)       (12,082)    (604,088)

Net loss                  (24,355)         -              (246)     (24,601)

Balance at
   December 31, 1995    4,606,880      (337,462)      (236,264)   4,033,154

Distributions (Note F)   (543,679)      (48,327)       (12,082)    (604,088)

Net income (Note F)         9,462           841            210       10,513

Balance at
   December 31, 1996   $4,072,663     $(384,948)     $(248,136)  $3,439,579

</TABLE>

The per Unit distributions for the years ended December 31, 1996, 1995 and
1994 were $20.00, $20.00 and $5.00, respectively.


                    The accompanying notes are an integral
                part of the consolidated financial statements.
<PAGE>
             KRUPP REALTY LIMITED PARTNERSHIP-VII AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF CASH FLOWS
             For the Years Ended December 31, 1996, 1995 and 1994

<TABLE>
<CAPTION>
                                         1996         1995          1994
<S>                                  <C>          <C>           <C>
Operating activities:
   Net income (loss)                 $    10,513  $   (24,601)  $  (409,938)
   Adjustments to reconcile
      net income (loss) to net cash
      provided by operating
      activities:
   Depreciation and amortization       1,325,765    1,281,398     1,293,815
   Decrease (increase) in restricted
      cash for tenant security
      deposits                              (844)      19,105         6,279
   Decrease (increase) in prepaid
      expenses and other assets          (16,154)       7,811      (227,230)
   Increase (decrease) in accounts
      payable                            (44,414)      23,338        25,080
   Increase in accrued expenses and
      other liabilities                   60,747       26,798        51,530
   Decrease in due to affiliates            -            -         (138,899)

         Net cash provided by
           operating activities        1,335,613    1,333,849       600,637

Investing activities:
   Additions to fixed assets            (691,972)    (262,341)     (221,949)
   Decrease (increase) in
      replacement reserve escrow           5,453       (3,273)        3,559
   Increase in accounts payable
      related to fixed asset
      additions                            3,315         -             -

         Net cash used in
           investing activities         (683,204)    (265,614)     (218,390)

Financing activities:
   Principal payments on mortgage
      notes payable                     (182,026)    (167,961)     (145,050)
   Proceeds from mortgage
      notes payable                         -            -        9,550,000
   Repayment of mortgage
      notes payable                         -            -       (9,174,830)
   Increase in deferred expenses            -          (6,613)     (280,679)
   Distributions                        (604,088)    (604,088)     (151,022)

         Net cash used in
           financing activities         (786,114)    (778,662)     (201,581)

Net increase (decrease) in cash and
   cash equivalents                     (133,705)     289,573       180,666
Cash and cash equivalents,
   beginning of year                   1,311,037    1,021,464       840,798
Cash and cash equivalents,
   end of year                       $ 1,177,332  $ 1,311,037   $ 1,021,464

</TABLE>
                        The accompanying notes are an integral
                    part of the consolidated financial statements.
<PAGE>
             KRUPP REALTY LIMITED PARTNERSHIP-VII AND SUBSIDIARIES

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                ______________

A.         Organization

Krupp Realty Limited Partnership-VII ("KRLP-VII") was formed on August 21,
1984 by filing a Certificate of Limited Partnership in The Commonwealth of
Massachusetts.  KRLP-VII terminates on December 31, 2025 unless earlier
terminated upon the occurrence of certain events as set forth in the
Partnership Agreement.  KRLP-VII issued all of the General Partner
Interests to two General Partners, The Krupp Corporation, a Massachusetts
corporation, and The Krupp Company Limited Partnership-II, a Massachusetts
limited partnership, in exchange for capital contributions aggregating
$1,000.  In addition, the General Partners were required to make additional
capital contributions of $135,891 which were used to pay organization and
offering costs in excess of 5% of the gross proceeds of the offering.
Except under certain limited circumstances upon termination of KRLP-VII,
the General Partners are not required to make any other additional capital
contributions.

KRLP-VII also issued all of the Original Limited Partner Interests to The
Krupp Company Limited Partnership-II in exchange for a capital contribution
of $4,000.

On November 2, 1984, KRLP-VII commenced an offering of up to 40,000 units
of Investor Limited Partner Interest (the "Units") for $1,000 per Unit.
The public offering was closed on April 25, 1986, at which time 27,184
Units had been sold for $27,184,000.

On December 19, 1984 the General Partners formed Krupp Realty Courtyards
Limited Partnership ("Realty-VII") as a prerequisite for the refinancing of
Courtyards Village East Apartments ("Courtyards").  At the same time, the
General Partners transferred ownership of Courtyards to Realty-VII.  The
General Partner of Realty-VII is The Krupp Corporation ("Krupp Corp.").
The Limited Partner of Realty-VII is KRLP-VII.  Krupp Corp. has
beneficially assigned its interest in Realty-VII to KRLP-VII.

On March 31, 1994, the General Partners formed Windsor Partners Limited
Partnership ("Windsor L.P.") as a prerequisite for the refinancing of
Windsor Apartments.  At the same time, the General Partners transferred
ownership of the property to Windsor L.P.  In exchange for the property,
KRLP-VII received a 99% Limited Partnership interest in Windsor L.P.  The
General Partner of Windsor L.P. is ST. Windsor Corporation which has a 1%
interest in Windsor L.P. and is 100% owned by KRLP-VII.

KRLP-VII, Realty-VII and Windsor L.P. are collectively known as Krupp
Realty Limited Partnership-VII and Subsidiaries (collectively referred to
herein as the "Partnership").

B.         Significant Accounting Policies

The Partnership uses the following accounting policies for financial
reporting purposes, which may differ in certain respects from those used
for federal income tax purposes (see Note J):

Basis of Presentation
The consolidated financial statements present the consolidated assets,
liabilities and operations of the Partnership.  All intercompany balances
and transactions have been eliminated.


                                   Continued
<PAGE>
KRUPP REALTY LIMITED PARTNERSHIP-VII AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued


CASH AND CASH EQUIVALENTS

The Partneship includes all short-term investments with original maturities of
three months or less from the date of acquisition in cash and cash equivalents.
The cash investments are recorded at cost, which approximates market values.

Rental Revenues

Residential and commercial leases require the payment of base rent monthly
in advance.  Rental revenues are recorded on the accrual basis.  Commercial
leases generally contain provisions for additional rent based on a
percentage of tenant sales and other provisions which are also recorded on
the accrual basis, but are billed in arrears.  Minimum rental revenue for
long term commercial leases is recognized on a straight-line basis over the
life of the related lease.

Depreciation

Depreciation is provided for by the use of the straight-line method over
estimated useful lives of the related assets as follows:

Buildings and improvements                2 to 39 years
Equipment, furnishings and fixtures       3 to  5 years

Tenant improvements for commercial tenants are depreciated over the life of
the related lease.

Impairment of Long-Lived Assets
In accordance with Financial Accounting Standard No. 121, "Accounting for
the Impairment of Long-Lived Assets and for Long-Lived Assets to Be
Disposed Of", which is effective for fiscal years beginning after December
15, 1995, the Partnership has implemented policies and practices for
assessing impairment of its real estate assets.

The investments in properties are carried at cost less accumulated
depreciation unless the General Partners believe there is a material
impairment in value, in which case a provision to write down investments in
properties to fair value will be charged against income.  At this time, the
General Partners do not believe that any assets of the Partnership are
materially impaired.


Continued
<PAGE>
           KRUPP REALTY LIMITED PARTNERSHIP-VII AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued


B.         Significant Accounting Policies - Continued
           Leasing Commissions

           Leasing commissions on commercial properties are deferred and
           amortized over the life of the related lease.

           Deferred Expenses

           Costs of obtaining and recording mortgages on the properties
           are being amortized over the term of the mortgage notes using
           the straight line method.

           Income Taxes

           The Partnership is not liable for federal or state income taxes
           as the Partnership income or loss is allocated to the Partners
           for income tax purposes.  In the event that the Partnership's
           tax returns are examined by the Internal Revenue Service or
           state taxing authority and the examination results in a change
           in the Partnership taxable income or loss, such change will be
           reported to the Partners.

           Reclassifications

           Certain prior year balances have been reclassified to conform
           with current year consolidated financial statement
           presentation.

C.         Cash and Cash Equivalents

           Cash and cash equivalents at December 31, 1996 and 1995 consist
           of the following:
                                                December 31,
                                            1996          1995

      Cash and money market accounts     $  285,964    $  517,636
      Commercial paper                      891,368       643,591
      Treasury bill                            -          149,810

                                         $1,177,332    $1,311,037

At December 31, 1996, commercial paper represents corporate issues
complying with Section 6.2(a) of the Partnership Agreement purchased
through a corporate issuer maturing in the first quarter of 1997.  At
December 31, 1996, the carrying value of the Partnership's investment in
commercial paper  approximates fair value.

Continued
             KRUPP REALTY LIMITED PARTNERSHIP-VII AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued


D.Mortgage Notes Payable

The properties owned by the Partnership are pledged as collateral for the
respective non-recourse mortgage notes payable outstanding at December 31,
1996 and 1995.  Mortgage notes payable consist of the following:

<TABLE>
<CAPTION>
                                                    Annual
                                 Principal           Interest
       Property             1996          1995         Rate   Maturity Date

   <S>                  <C>           <C>                <C>    <C>
   Courtyards Village
   East Apartments      $ 3,219,833   $ 3,309,098        7%     Sept 21, 2014

   Nora Corners
     Shopping Center      4,141,618     4,194,262        9%   October 1,2004

   Windsor Apartments     5,200,714     5,240,831      9.25%    May 1, 2001

     Total              $12,562,165   $12,744,191

</TABLE>
Courtyards Village East Apartments

The property is subject to a non-recourse mortgage note payable, held by
the U.S. Department of Housing and Urban Development ("HUD") which requires
equal monthly installments of $26,506, consisting of principal and
interest.  In addition, the Partnership is required to make a monthly
deposit of $2,000 to an escrow account to be used for property replacements
and improvements, and a monthly mortgage insurance premium deposit equal to
 .5% per annum of the outstanding principal balance.  As of December 1,
1996, the mortgage can be prepaid without penalty.  Under the terms of the
loan, HUD restricts the distribution of funds to Surplus Cash, as defined
by HUD in the Regulatory Agreement.

Based on the borrowing rates currently available to the Partnership for
bank loans with similar terms and average maturities, the fair value of
long-term debt is approximately $3,000,000 for both years ended December
31, 1996 and 1995, respectively.

Nora Corners Shopping Center

On October 6, 1994, the Partnership refinanced the Nora Corners mortgage
note for $4,250,000.  The non-recourse mortgage note is payable, based on a
25-year amortization, in equal monthly installments of $35,666, consisting
of principal and interest.  At maturity, all unpaid principal,
approximately $3,526,000, and any accrued interest is due.  After October
1, 1998, the note may be prepaid subject to a prepayment penalty.  The
Partnership incurred refinancing costs of $123,175, which are being
amortized over the term of the mortgage note.

Based on the borrowing rates currently available to the Partnership for
bank loans with similar terms and average maturities, the fair value of
long-term debt is approximately $4,300,000 and $4,400,000 for the years
ended December 31, 1996 and 1995, respectively.



Continued
             KRUPP REALTY LIMITED PARTNERSHIP-VII AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued



D.          Mortgage Notes Payable - Continued

            Windsor Apartments

On April 13, 1994, the Partnership refinanced the Windsor Apartments
mortgage note for $5,300,000.  The non-recourse mortgage note is payable,
based on a 30-year amortization, in equal monthly installments of $43,602,
consisting of principal and interest.  At maturity, all unpaid principal,
approximately $5,021,000, and any accrued interest is due.  After October
13, 1997, the note may be prepaid subject to a prepayment penalty.  The
Partnership incurred refinancing costs of $164,115 which are being
amortized over the term of the mortgage note.

Based on the borrowing rates currently available to the Partnership for
bank loans with similar terms and average maturities, the fair value of
long-term debt is approximately $5,400,000 and $5,500,000 for the years
ended December 31, 1996 and 1995, respectively.

The aggregate scheduled principal amounts of long-term borrowings due
during the five years ending December 31, 2001 are $195,968, $212,423,
$230,284, $249,674 and $5,210,259.

The Partnership paid interest on its borrowings in the amounts of
$1,087,261, $1,101,325 and $1,210,975 during the years ended December 31,
1996, 1995 and 1994, respectively.

E.Accrued Expenses and Other Liabilities
Accrued expenses and other liabilities consist of the following at December
31, 1996 and 1995:
                                                      1996         1995
        Accrued real estate taxes                   $478,793     $419,964
        Other liabilities                            275,754      271,763
        Tenant security deposits                      76,532       84,091
        Prepaid rent                                  15,340        9,854
                                                    $846,419     $785,672



                                   Continued
<PAGE>
             KRUPP REALTY LIMITED PARTNERSHIP-VII AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued



F.Partners' Equity
Under the terms of the Partnership Agreement, losses from operations are
allocated 99% to the Investor Limited Partners and 1% to the General
Partners.  Profits from operations are allocated 90% to the Investor
Limited Partners, 8% to the Original Limited Partner and 2% to the General
Partners, until such time that the Investor Limited Partners have received
a return of their total invested capital plus a 9% per annum cumulative
return thereon and thereafter, 69% to the Investor Limited Partners, 25%
to the Original Limited Partner and 6% to the General Partners.
Under the terms of the Partnership Agreement, cash distributions are
generally made on the same basis as the allocations of profits described
above.  Distributions from a sale, exchange, refinancing, or other
disposition of a property or upon the termination of the Partnership are to
be allocated differently than that described above and will be made in part
after payment by the Partnership of a certain subordinated financial
consulting fee as described below.

The Partnership entered into a Sales Agent Agreement for the public
offering of Units.  Under that Agreement, the Partnership was required to
pay to the sales agent underwriting commissions and related financial
consulting fees equal to 9% of the gross proceeds from the offering.  In
addition, the sales agent will be entitled to receive, over the life of the
Partnership, a subordinated financial consulting fee based upon the net
cash proceeds received by the Partnership as a result of sales and
refinancings of Partnership properties, which fee shall be in an amount not
exceeding 1.5% of the gross proceeds of the offering of Units.  No such
fees will, however, be payable unless and until all Partners have received
a return of their Invested Capital and the Investor Limited Partners have
received a 9% per annum cumulative return.

As of December 31, 1996, the following cumulative partner contributions and
allocations have been made since the inception of the Partnership:
<TABLE>
<CAPTION>
                           Investor      Original                  Total
                           Limited       Limited      General     Partners'
                           Partners      Partner     Partners      Equity

   <S>                   <C>            <C>         <C>         <C>
   Capital contributions $ 27,184,000   $    4,000  $ 136,891   $ 27,324,891
   Syndication costs       (3,697,375)        -      (135,891)    (3,833,266)
   Distributions           (4,385,135)    (389,789)   (97,445)    (4,872,369)
   Net loss from capital
     transactions            (816,767)        -        (8,250)      (825,017)
   Net income (loss)
     from operations      (14,212,060)         841   (143,441)   (14,354,660)

   Balance at
     December 31,1996    $  4,072,663   $ (384,948) $(248,136)  $  3,439,579

</TABLE>

                                      Continued

             KRUPP REALTY LIMITED PARTNERSHIP-VII AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued



G.Future Base Rents Due Under Commercial Operating Leases

Future base rents due under commercial operating leases for the years 1997
through 2001 and thereafter are as follows:
<TABLE>
<CAPTION>
                       <S>            <C>
                       1997           $  809,800
                       1998              739,500
                       1999              653,500
                       2000              531,600
                       2001              384,400
                       Thereafter      1,279,500

H.         Leases

           Nora Corners is situated on 11.21 acres of land, seven acres of
           which are owned by certain non-affiliated third parties.  These
           seven acres of land are leased to the Partnership subject to a
           99-year land lease which expires in 2061.  The land lease
           requires annual rental payments of $17,280 from 1987 through
           2012, $20,180 from 2012 through 2037, and $23,040 from 2037
           through 2061.  Under the terms of the land lease, the lessee
           may assign its rights to a subsequent purchaser of the
           property.

I. Related Party Transactions

   Commencing with the date of acquisition of the Partnership's properties,
   the Partnership entered into agreements under which property management
   fees are paid to an affiliate of the General Partners for services as
   management agent.  Such agreements provide for management fees payable
   monthly at a rate of 4% of the gross receipts, net of leasing
   commissions from commercial properties under management and 5% of the
   gross receipts from residential properties under management.  The
   Partnership also reimburses affiliates of the General Partners for
   certain expenses incurred in connection with the operation of the
   Partnership and its properties including accounting, computer,
   insurance, travel, legal and payroll, and with the preparation and
   mailing of reports and other communications to the Limited Partners.

   Amounts accrued or paid to the General Partners or their affiliates
   during the years ended December 31, 1996, 1995 and 1994 were as follows:


</TABLE>
<TABLE>
<CAPTION>
                                          1996        1995        1994
      <S>                               <C>         <C>         <C>
      Property management fees          $193,484    $192,572    $176,861
      Expense reimbursements             157,089     129,445     209,994

         Charged to operations          $350,573    $322,017    $386,865
</TABLE>
In addition to the amounts above, the following amounts relating to
refinancing activities were paid to the General Partners or their
affiliates:

                                          1996        1995        1994
      Cost reimbursements               $  -        $  3,793    $ 45,814



                                   Continued
<PAGE>
             KRUPP REALTY LIMITED PARTNERSHIP-VII AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued


J. Federal Income Taxes

   For federal income tax purposes, the Partnership is depreciating
   property using the Accelerated Cost Recovery System ("ACRS") and the
   Modified Accelerated Cost Recovery System ("MACRS") depending on which
   is applicable.

   The reconciliation of the net income (loss) reported in the accompanying
   Consolidated Statement of Operations with the net loss reported in the
   Partnership's federal income tax return for the years ended December 31,
   1996, 1995 and 1994 is as follows:

<TABLE>
<CAPTION>
                                     1996            1995        1994
      <S>                          <C>            <C>         <C>
      Net income (loss) per
        Consolidated Statement of
        Operations                   $  10,513      $(24,601)   $(409,938)

      Add:  Difference in book
             to tax depreciation
             and amortization          (35,798)      (64,375)     (73,351)

      Less: Rental adjustment
             required by Generally
             Accepted Accounting
             Principles                  1,208         3,467        3,344

      Net loss for federal
        income tax purposes           $(24,077)     $(85,509)   $(479,945)
</TABLE>

   The allocation of the net loss for federal income tax purposes for the year
   ended December 31, 1996 is as follows:
<TABLE>
<CAPTION>
                                 Portfolio   Passive
                                  Income       Loss        Total

   <S>                           <C>        <C>          <C> >
   General Partners              $   797    $  (1,037)   $   (240)

   Original Limited Partner          -           -            -

   Investor Limited Partners      78,855     (102,692)    (23,837)

                                 $79,652    $(103,729)   $(24,077)
</TABLE>


For the years ended December 31, 1996, 1995 and 1994, the per Unit net loss
to the Investor Limited Partners for federal income tax purposes was
$(.88), $(3.11) and $(17.48), respectively.

The basis of the Partnership's assets for financial reporting purposes
exceeds its tax basis by approximately $4,198,500 and $1,795,000 at
December 31, 1996 and 1995, respectively.  The tax and book basis of the
Partnership's liabilities are the same.
   <PAGE>
             KRUPP REALTY LIMITED PARTNERSHIP-VII AND SUBSIDIARIES

            SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION

                               December 31, 1996
<TABLE>
<CAPTION>

                                                           Costs
                                                       Capitalized
                                                       Subsequent to
                          Initial Cost to Partnership  Acquisition
                                         Buildings &    Buildings &  Depreciable
Description   Encumbrances     Land      Improvements   Improvements    Life

<S>             <C>           <C>          <C>          <C>            <C>
Courtyards
Village East
Apartments
Naperville,
Illinois        $ 3,219,833   $  487,529   $ 6,486,198  $1,478,653     3
                                                                       to 25
                                                                        Years


Nora Corners
Shopping Center
Indianapolis,
Indiana           4,141,618      775,345     8,240,342     699,186    2 to 39
                                                                      Years

Windsor
Apartments
Garland,
Texas             5,200,714      696,362     9,251,669     790,423    3 to 25
                                                                       Years

  Total         $12,562,165       $1,959,236   $23,978,209     $2,968,262

</TABLE>
<TABLE>
<CAPTION>
                      Gross Amounts Carried at
                            End of Year                Accum-    Year
                               Buildings               lated   Constru-  Date
                                 and                   Depre-   uction   Acqu-
Description     Land       Improvements      Total    ciation  Completed ired

<S>           <C>            <C>          <C>          <C>          <C>   <C>
Courtyards
Village East
Apartments
Naperville,
Illinois      $  487,529     $ 7,964,851  $ 8,452,380  $ 4,637,629  1973  4/1/85


Nora Corners
Shopping Center
Indianapolis,
Indiana         775,345       8,939,528    9,714,873    3,676,352   1985 9/24/86

Windsor
Apartments
Garland,
Texas           696,362      10,042,092   10,738,454    5,783,142  1984 12/27/84


  Total       $1,959,236     $26,946,471    $28,905,707  $14,097,123

</TABLE>


Continued
<PAGE>
KRUPP REALTY LIMITED PARTNERSHIP-VII AND SUBSIDIARIES

SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION
(Continued)

December 31, 1996



Reconciliation of Real Estate and Accumulated Depreciation for each of the
three years in the period ended December 31, 1996:

<TABLE>
<CAPTION>
                                      1996           1995          1994

   Real Estate

   <S>                            <C>            <C>          <C>
   Balance at beginning of year   $28,213,735    $27,951,394  $27,729,445

   Acquisition and improvements       691,972        262,341      221,949

   Balance at end of year         $28,905,707    $28,213,735  $27,951,394



                                      1996           1995         1994
   Accumulated Depreciation

   Balance at beginning of year   $12,807,221    $11,561,799  $10,333,495

   Depreciation expense             1,289,902      1,245,422    1,228,304

   Balance at end of year         $14,097,123    $12,807,221  $11,561,799

</TABLE>
The Partnership uses the cost basis for property valuation for both income
tax and financial statement purposes.  The aggregate cost of the
Partnership's real estate for federal income tax purposes is $28,876,862
and the aggregate accumulated depreciation for federal income tax purposes
is $18,266,817.