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

                           FORM 10-K/A

AMENDMENT NO. 1



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             0-14378    
         

  Krupp Institutional Mortgage Fund Limited
Partnership
(Exact name of registrant as specified in its
charter)

          Massachusetts                      
          04-2860302
(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 


The total number of pages in this document is
18.
<PAGE>

ITEM 8.FINANCIAL STATEMENTS AND SUPPLEMENTARY
DATA

See Appendix A to this report.

<PAGE>
                  SIGNATURE


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 18th day of
September, 1997.

KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED
PARTNERSHIP

By:The Krupp Corporation, a General Partner
By:/s/ Wayne H. Zarozny                       

Wayne H. Zarozny 
Treasurer of The Krupp Corporation


<PAGE>



                           APPENDIX A

      KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED PARTNERSHIP
                                     












                      FINANCIAL STATEMENTS
                       ITEM 8 OF FORM 10-K

     ANNUAL REPORT TO THE SECURITIES AND EXCHANGE COMMISSION
              For the Year Ended December 31, 1996





















<PAGE>
      KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED PARTNERSHIP

                  INDEX TO FINANCIAL STATEMENTS
                                        



Report of Independent Accountants         F-3

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

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

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

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

Notes to Financial Statements      F-8 - F-15


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



To the Partners of Krupp Institutional
Mortgage Fund Limited Partnership:

We have audited the financial statements of
Krupp Institutional Mortgage Fund Limited
Partnership (the "Partnership") listed in the
index on page F-2 of this Form 10-K.  These
financial statements are the responsibility of
the Partnership's management.  Our
responsibility is to express an opinion on
these financial statements 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
financial statements.  An audit also includes
assessing the accounting principles used and
significant estimates made by management, as
well as evaluating the overall financial
statement presentation.  We believe that our
audits provide a reasonable basis for our
opinion.

As discussed in Note E, the Partnership has
recorded a loan loss reserve of $16,524,000
and a reserve for uncollectible interest of
$12,225,634, based on management's estimate of
the value of the properties which serve as
collateral for the mortgage notes receivable. 
As is the case with all real estate, the
ultimate value of such properties can only be
determined in a negotiation between buyer and
seller.

In our opinion, the financial statements
referred to above present fairly, in all
material respects, the financial position of
Krupp Institutional Mortgage Fund Limited
Partnership as of December 31, 1996 and 1995,
and the 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.


                            


Boston, Massachusetts    COOPERS & LYBRAND,
L.L.P.
March 6, 1997



<PAGE>
      KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED PARTNERSHIP

                         BALANCE SHEETS
                   December 31, 1996 and 1995
                                       
<TABLE>
<CAPTION>
                             ASSETS



                                            1996        1995   

Mortgage notes receivable, net of loan loss
  reserve of $16,524,000 for 1996 and 1995,
  <S>                                   <C>         <C>
  (Notes C, D and E)                    $ 6,973,754 $11,795,943
Cash and cash equivalents (Note F)        1,112,524   1,260,798
Accrued interest receivable - mortgage notes,
  net of reserve for uncollectible interest of
  $12,225,634 and $9,755,416, respectively
  (Notes C, D and E)                        115,272     112,304
Due from affiliates (Note H)                 16,250       1,575
Other assets                                  1,672       2,160

     Total assets                       $ 8,219,472 $13,172,780



                LIABILITIES AND PARTNERS' EQUITY

Liabilities                             $    25,274 $    12,952

Partners' equity (deficit)(Note G):

Limited Partners (30,059 Units outstanding)8,411,861  13,327,834
  General Partners                         (217,663)    (168,006)

Total Partners' equity                    8,194,198  13,159,828

Total liabilities and Partners' equity  $ 8,219,472 $13,172,780


</TABLE>





















             The accompanying notes are an integral
                part of the financial statements.
<PAGE>
      KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED PARTNERSHIP

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

<TABLE>
<CAPTION>
                                           
                                 1996      1995        1994    
Interest income:
  Mortgage notes receivable
       <S>                     <C>       <C>        <C>
       (Notes C, D and E)      $497,376  $799,092   $ 1,020,409
  Cash equivalents (Note F)      79,000    69,528        39,741

     Total revenue              576,376   868,620     1,060,150

Expenses:                      
Expense reimbursements (Note H)  33,345    49,689        96,608
  General and administrative     60,088    53,806        64,122
  Provision for credit losses
       (Notes C, D and E)          -         -        4,500,000

     Total expenses              93,433   103,495     4,660,730

Net income (loss) (Note I)     $482,943  $765,125   $(3,600,580)


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

  Limited Partners (30,059 Units
     outstanding)              $478,114  $757,474   $(3,564,574)
  
  Per Unit of Limited Partner
     Interest                  $  15.91  $  25.20   $   (118.59)

  General Partners             $  4,829  $  7,651   $   (36,006)


</TABLE>
























             The accompanying notes are an integral
                part of the financial statements.
<PAGE>
      KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED PARTNERSHIP

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

<TABLE>

<CAPTION>
                                                      Total
                             Limited    General      Partners'
                             Partners   Partners      Equity   

<S>                          <C>         <C>        <C>
Balance at December 31, 1993 $17,487,588 $(125,987) $17,361,601

Distributions                 (676,327)    (6,832)     (683,159)

Net loss                    (3,564,574)  (36,006)    (3,600,580)

Balance at December 31, 1994 13,246,687 (168,825)    13,077,862

Distributions                 (676,327)  (6,832)       (683,159)

Net income                     757,474     7,651        765,125

Balance at December 31, 1995 13,327,834 (168,006)    13,159,828

Distributions (Note G)      (5,394,087)  (54,486)    (5,448,573)

Net income (Note G)            478,114     4,829        482,943

Balance at December 31, 1996$ 8,411,861 $(217,663)  $ 8,194,198

</TABLE>
The per Unit distributions for the years 1994
through 1996 were $22.50, $22.50 and $179.45,
respectively.












             The accompanying notes are an integral
                part of the financial statements.
<PAGE>
      KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED PARTNERSHIP

                    STATEMENTS OF CASH FLOWS
      For the Years Ended December 31, 1996, 1995 and 1994
<TABLE>
<CAPTION>
                                       


                                  1996        1995         1994   
Operating activities:
  <S>                          <C>        <C>          <C>
  Net income (loss)            $  482,943 $   765,125  $(3,600,580)
  Adjustments to reconcile net
     income (loss) to net cash
     provided by operating
     activities:
  Provision for credit losses        -           -       4,500,000
  Decrease (increase) in
     accrued interest receivable
     - mortgage notes              (2,968)    118,812    (205,236)
  Decrease (increase) in due from
     affiliates                   (14,675)      9,159      (10,734)
  Decrease (increase) in other 
     assets                           488        (891)      1,344
  Increase (decrease) in
     liabilities                   12,322      (1,372)      8,437

       Net cash provided by 
          operating activities    478,110     890,833      693,231

Investing activity:
  Principal collections from 
     mortgage notes receivable  4,822,189      26,460       23,952

Financing activity:
  Distributions                (5,448,573)   (683,159)   (683,159)
     
Net increase (decrease) in cash 
  and cash equivalents           (148,274)   234,134       34,024

Cash and cash equivalents, 
  beginning of year             1,260,798   1,026,664      992,640

Cash and cash equivalents, 
  end of year                  $1,112,524 $ 1,260,798  $ 1,026,664

</TABLE>




















             The accompanying notes are an integral
                part of the financial statements.
<PAGE>
      KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED PARTNERSHIP

                  NOTES TO FINANCIAL STATEMENTS
                                        



A.Organization

Krupp Institutional Mortgage Fund Limited
Partnership (the "Partnership") was formed on
November 15, 1984 by filing a Certificate of
Limited Partnership in The Commonwealth of
Massachusetts.  The Partnership was formed for
the purpose of making participating mortgage
loans ("the Participating Notes") to Krupp
Equity Limited Partnership ("KELP"), in the
amount of up to 95% of the proceeds of the
offering of units of limited partner interest
(the "Units")  (see Note D).  The Partnership
terminates on December 31, 2013 unless earlier
terminated upon the occurrence of certain
events as set forth in the Partnership
Agreement.  

The Partnership issued all of the General
Partner Interests to The Krupp Corporation
("Krupp Corp.") and The Krupp Company Limited
Partnership-III ("Krupp Co.-III"), in exchange
for capital contributions aggregating $1,000. 
The General Partners made additional capital
contributions of $4,207,560 which equals
fourteen percent of the capital contributions
of the Investor Limited Partners.  The
Partnership used these capital contributions
to pay costs incurred in connection with its
organization and the public offering of Units.


On February 21, 1985, the Partnership
commenced the marketing and sale of the Units
for $1,000 per Unit.  The public offering was
closed on December 5, 1985, at which time
30,059 Units had been sold.

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 I).

Risks and Uncertainties
                                   
The Partnership invests its cash primarily in
deposits and money market funds with
commercial banks.  The Partnership has not
experienced any losses to date on its invested
cash.

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

Cash and Cash Equivalents

The Partnership includes all short-term
investments with maturities of three months or
less from the date of acquisition in cash and
cash equivalents.  Cash equivalents are
recorded at cost, which approximates current
market value.
                      
                            Continued
<PAGE>
      KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED PARTNERSHIP

            NOTES TO FINANCIAL STATEMENTS, Continued
                                        



B.Significant Accounting Policies, Continued

Provisions for Credit Losses and Accrued
Interest Reserves

In accordance with Statement of Financial
Accounting Standard No. 114, "Accounting by
Creditors for Impairment of a Loan", and
Statement of Financial Accounting Standard No.
118, "Accounting by Creditors for Impairment
of a Loan - Income Recognition and
Disclosures", the Partnership has implemented
polices and practices for assessing impairment
of its mortgage loans and the recognition of
income on impaired loans.

Mortgage notes receivable are recorded at the
lower of cost or estimated net realizable
value.  The estimated net realizable value of
the mortgage loans is based on current market
estimates of the underlying properties held as
collateral considering such factors as tenant
turnover, current and prospective occupancy
levels, the current market competition and
assumptions on potential proceeds that might
be received upon sale.  Given the uncertainty
of real estate valuation in the current
market, these market estimates could differ
from the ultimate value obtained from a sale
of such properties (see Note E).  
                                   
The Partnership recognizes interest income on
its impaired loans based on the expected cash
flow payments to be received from KELP.  Cash
flow payments are determined as all cash flow
generated by the properties after operating
and administrative expenses and senior
mortgage obligations.  Unpaid interest and
late charges are accrued and reserved against. 
For financial reporting purposes, the
Partnership recognizes sales proceeds received
from KELP as repayments of principal on the
mortgage notes receivable.

Income Taxes

The Partnership is not liable for federal or
state income taxes as 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 such  examination results in a
change in the Partnership's taxable income or
loss, such change will be reported to the
Partners.

C.Mortgage Notes Receivable

The Partnership made loans to KELP, an
affiliate of the Partnership, as provided
under the Master Loan Agreement and Collateral
Pledge Agreement (the "Agreements").  Under
the terms of the Master Loan Agreement, basic
interest accrued at a rate of 7.6% per annum
and was payable quarterly, in arrears, on the
unpaid principal balance of the Participating
Notes which were due on December 31, 1992,
however, the Partnership exercised its option
to extend the maturity date to December 29,
1995.

KELP's properties began experiencing cash flow
deficiencies and, beginning with the payment
due April 1, 1991, KELP has not been able to
fully pay the required quarterly interest
payments.

The terms of the Master Loan Agreement
required KELP to pay the Partnership adjusted
basic interest at a rate of 10% per annum,
which accrued and was payable quarterly, in
arrears, on the unpaid principal balance of
the Participating Notes.  The Participating
Notes matured December 29, 1995.  



                            Continued
<PAGE>
      KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED PARTNERSHIP

            NOTES TO FINANCIAL STATEMENTS, Continued
                                        


C.   Mortgage Notes Receivable, Continued

  Mortgage Notes Receivable consisted of the following as of
  December 31, 1996 and 1995:
<TABLE>
<CAPTION>
               Principal                          Property       
                                          1996                1995 
 

<S>                                  <C>           <C>
Northeast Plaza Shopping Center      $  6,907,763  $  6,936,993

North Salado Village Shopping Center I        -      1,513,000

North Salado Village Shopping Center II       -      6,000,000

Village Green Apartments                      -      1,902,750

Bell Plaza Shopping Center              5,300,000     5,300,000

    Mortgage notes receivable
      collateralized by properties     12,207,763   21,652,743

    Remaining indebtedness from previously
      owned KELP properties            16,082,950    6,667,200

    Mortgage notes receivable before
      reserve and sales proceeds
      received from KELP               28,290,713  28,319,943

    Less: Sales proceeds received from 
      KELP                             (4,792,959)       -

    Less: Loan loss reserve           (16,524,000) (16,524,000)
 
    Total mortgage notes receivable  $  6,973,754 $ 11,795,943
</TABLE>
Northeast Plaza Shopping Center ("Northeast
Plaza")

Northeast Plaza is an 89,224 square foot
shopping plaza located in Baton Rouge,
Louisiana.  On September 12, 1985, the
Partnership loaned KELP $6,000,000
collateralized by a second mortgage on the
Northeast Plaza and the Collateral Pledge
Agreement.

The non-recourse first mortgage of $994,873,
collateralized by Northeast Plaza, matured in
1993.  In 1994, the General Partners used a
portion of working capital reserves to
purchase the first mortgage note in order to
preserve the Partnership's equity in the
underlying property and became the first lien
holder of the property.  As a result, the
Partnership earns 10% from its first mortgage
interest investment versus 4% to 6% earned on
the working capital reserve balance.  

The maturity date of the note was extended to
December 29, 1995 as evidenced by the
modification of the promissory note dated
August 31, 1993. The note requires monthly
payments of $10,135 consisting of principal
and interest at the rate of 10% per annum
based on a 25-year amortization schedule.  The
non-recourse first mortgage note had balances
of $907,763 and $936,993 at December 31, 1996
and 1995, respectively.


 

                  Continued             
  KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED
PARTNERSHIP

  NOTES TO FINANCIAL STATEMENTS, Continued
                              

C.Mortgage Notes Receivable - Continued

Bell Plaza Shopping Center ("Bell")

Bell is a 43,842 square foot shopping center
located in Oak Lawn, Illinois, a suburb of
Chicago.  On June 2, 1987, the Partnership
loaned KELP $5,300,000 collateralized by a
first mortgage evidenced by a deed of trust on
Bell and the Collateral Pledge Agreement.

The average outstanding balances of the
mortgage notes receivable were $25,908,849,
$28,333,173 and $28,358,379 at December 31,
1996, 1995 and 1994, respectively.
 
The carrying value of the above mentioned
mortgage notes receivable reflected in the
accompanying balance sheets at December 31,
1996 and 1995 approximates fair value.

During 1996, KELP sold Village Green
Apartments and North Salado Village Shopping
Center to unaffiliated third parties.  The
Partnership applied sales proceeds of
$4,792,959 received from KELP against the
outstanding mortgage notes receivable (see
Note D).

D.Krupp Equity Limited Partnership

KELP was formed on January 3, 1985 by filing a
Certificate of Limited Partnership in The
Commonwealth of Massachusetts.  KELP
terminates on December 31, 2005, unless
earlier terminated upon the occurrence of
certain events as set forth in its Partnership
Agreement.  KELP issued all of the General
Partner Interests to two General Partners,
Krupp Corp. and Krupp Co.-III, and issued all
of the Limited Partner Interests to Krupp Co.-
III.  KELP received capital contributions from
the two General Partners, Krupp Corp. and
Krupp Co-III, totalling $480,000 which
consisted of $204,000 in cash and $276,000 in
promissory notes.  KELP also received
$6,984,086 of Limited Partner capital
contributions from Krupp Co.-III consisting of
cash, the assumption of a note payable to an
affiliate in the amount of $1,550,013, and
promissory notes in the amount of $2,514,388.
These promissory notes, totalling $2,790,388,
are pledged as additional collateral for the
Participating Notes under the Master Loan
Agreement and the Collateral Pledge Agreement.

The purpose of KELP is to acquire, manage,
operate and sell real estate and personal
property; and to borrow funds from the
Partnership and other sources to finance the
acquisition, management and operation of real
estate and personal property related thereto. 
Condensed financial statements of KELP are as
follows:














                            Continued
      KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED PARTNERSHIP

            NOTES TO FINANCIAL STATEMENTS, Continued
                                        



D.   Krupp Equity Limited Partnership - Continued

                KRUPP EQUITY LIMITED PARTNERSHIP

                    CONDENSED BALANCE SHEETS
                   December 31, 1996 and 1995
<TABLE>
<CAPTION>
                                       
                                    ASSETS
                                            1996         1995    
  <S>                                   <C>          <C>
  Property, at cost (1)                 $ 12,716,122 $ 30,960,353
  Property valuation provision (2)        (5,000,000)  (5,986,000)
  Accumulated depreciation                (3,795,870) (10,206,689)

     Total real estate assets              3,920,252   14,767,664
  
  Other assets                               305,538    1,012,929

     Total assets                       $  4,225,790 $ 15,780,593

                LIABILITIES AND PARTNERS' DEFICIT

Mortgage notes payable to the Partnership(1)$ 28,290,713$28,319,943
Mortgage notes payable (1)         -       7,599,279
Notes payable to an affiliate                300,000       300,000
Accrued interest payable to an affiliate (1)7,880,286   10,171,783
  Due to affiliates                          666,702       767,737
  Other liabilities                          386,780      560,388

  Total liabilities                       37,524,481   47,719,130

Partners' deficit                        (33,298,691)  (31,938,537)

Total liabilities and Partners' deficit $  4,225,790 $ 15,780,593
</TABLE>

(1)On March 5, 1996, Village Green was sold to
an unaffiliated party for $5,200,000.  The
sale agreement required the buyer to assume
the first mortgage note payable on the
property of $4,633,989 and as a result, no
prepayment penalty was assessed by the holder
of the note.  The sale resulted in a gain to
KELP of $1,457,889, for financial reporting
purposes.  On May 16, 1996, North Salado was
sold to an unaffiliated third party for
$7,350,000.  The first mortgage note payable
of $2,920,405 was paid at the closing and no
prepayment penalty was assessed, under the
terms of the mortgage note.  The sale of the
property resulted in a gain of $121,515 to
KELP, for financial reporting purposes.  The
properties were released as collateral by the
Partnership for KELP's secondary mortgage
obligations.  For KELP's financial reporting
purposes, sales proceeds paid to KIMF of
$4,792,959 were applied against accrued
interest in 1996.
(2)During the fourth quarter of 1995, the
General Partners of KELP determined that the
carrying value of its retail properties
exceeded its net realizable value which
resulted in an additional valuation adjustment
of $586,000 which was charged against
earnings.  In 1996, no additional adjustment
to KELP's remaining real estate investments
was required, and to date the General Partners
have recorded a cumulative property valuation
provision of $5,000,000.

 Continued
      KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED PARTNERSHIP

            NOTES TO FINANCIAL STATEMENTS, Continued
                                        

  
D.    Krupp Equity Limited Partnership - Continued

KRUPP EQUITY LIMITED PARTNERSHIP

               CONDENSED STATEMENTS OF OPERATIONS
      FOR THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
                               1996        1995        1994  

<S>                        <C>         <C>         <C>
Revenue                    $ 1,737,771 $ 3,479,262 $  4,320,747
Property operating expenses   (726,856)  (1,535,994)  (2,074,159)
  Operating income           1,010,915    1,943,268    2,246,588
  
Depreciation and amortization (784,010)   (844,628)  (1,218,383)
Interest                    (3,166,463)  (3,692,639)  (4,038,180)
  
  Loss before gain on sale
    of properties and property 
    valuation provision     (2,939,559) (2,593,999)   (3,009,975)

Gain on sale of properties   1,579,404        -       (3,592,179)
Property valuation provision      -       (586,000)   (5,400,000)

  Loss before extraordinary
    gain                    (1,360,155)  (3,179,999) (12,002,154)
  
Extraordinary gain - debt
  forgiveness                     -           -        1,176,738

  Net loss                 $(1,360,154) $(3,179,999)$(10,825,416)
</TABLE>

It is expected that KELP will continue to be
unable to pay its stated debt service
obligation to the Partnership.  The General
Partners of KELP have attempted to mitigate
the cash flow issues in the following ways: 1)
the General Partners or the Limited Partner of
KELP have funded certain prior deficits
through capital contributions; 2) the General
Partners of KELP have arranged for borrowings
to cover certain prior deficits; 3) KELP has
remitted to the Partnership all available cash
flow from the properties; and 4) the
management agent for the properties (an
affiliate of the General Partners of KELP) has
continued to serve even though it is not
receiving payment of property management fees. 
KELP will continue to monitor expenses and
implement rental increases as market
conditions permit in order to increase cash
flow from the properties. 

E.Provision for Credit Losses and Accrued
Interest Reserves

The General Partners of the Partnership have
recorded a cumulative provision for credit
losses of $16,524,000 on its mortgage notes
receivable.  Additionally, the Partnership has
recorded cumulative provisions for
uncollectible interest of $12,225,634 and
$9,755,416 as of December 31, 1996 and 1995,
respectively.  These cumulative provisions are
recorded against the carrying value of the
assets in order to reflect management's
current estimates of the underlying property
values which, given the inherent uncertainty
of real estate valuation in the current
market, could differ from the ultimate value
obtained upon sale of such properties.


                            Continued
<PAGE>
      KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED PARTNERSHIP

            NOTES TO FINANCIAL STATEMENTS, Continued
                                        



F.   Cash and Cash Equivalents
     
  Cash and cash equivalents at December 31, 1996 and 1995 consist
  of the following:
<TABLE>
<CAPTION>
                                       1996           1995   

      <S>                              <C>        <C>
      Cash and money market accounts$  316,317    $  465,788
      Commercial paper                 796,207       795,010
                                    $1,112,524    $1,260,798
</TABLE>

Commercial paper at December 31, 1996
represents corporate issues complying with
Section 3.04 of the Partnership Agreement
maturing in the first quarter of 1997. 
 
G.Partners' Equity

Net profits and losses from Partnership
operations, excluding Additional Interest on
the Participating Notes, shall be determined
as of the end of each fiscal year, and are
allocated ninety-nine percent (99%) to the
class of Limited Partners and one percent (1%)
to the class of General Partners.

Net profits and losses and Distributable Cash
from Operations, as defined by Section 5.01 of
the Partnership Agreement, allocated to the
Limited Partners have been apportioned in the
ratio of the number of Units owned per Limited
Partner to the total number of Units
outstanding.  The General Partners portion of
net profits and losses, distributions of
Distributable Cash from Operations and Surplus
Funds, as defined, has been allocated
proportionately among the General Partners
according to their respective invested
capital.

Distributable Cash from Operations shall be
distributed ninety-nine percent (99%) to the
class of Limited Partners and one percent (1%)
to the class of General Partners.  Surplus
Funds received by the Partnership, as defined
in the Partnership Agreement, are to be
allocated differently than that described
above.

As of December 31, 1996, the following
cumulative Partner contributions and
allocations were made since inception of the
Partnership:

<TABLE>
<CAPTION>
                                                        Total
                             Limited      General      Partners'
                             Partners     Partners      Equity   

   <S>                     <C>          <C>          <C>
   Capital contributions   $ 30,059,000 $ 4,208,560  $ 34,267,560 


   Syndication costs             -        (4,157,560)  (4,157,560)

   Distributions            (20,310,311)    (205,157) (20,515,468)

   Net loss                  (1,336,828)     (63,506)  (1,400,334)
   
   Balance at
    December 31, 1996      $  8,411,861  $  (217,663)$  8,194,198
</TABLE>

Continued
<PAGE>
      KRUPP INSTITUTIONAL MORTGAGE FUND LIMITED PARTNERSHIP

            NOTES TO FINANCIAL STATEMENTS, Continued
                                        

H.Related Party Transactions

The Partnership reimburses affiliates of the
General Partners for certain expenses incurred
in connection with the activities of the
Partnership, including communications,
bookkeeping and clerical work necessary in
maintaining relations with Limited Partners,
and accounting, tax and computer services
necessary for the maintenance of the books and
records of the Partnership.
                      
 Due from affiliates consists of the following as of December 31, 1996 and
1995:
<TABLE>
<CAPTION>
                                       1996      1995 
     <S>                             <C>       <C>
     Expense reimbursements          $16,250   $ 1,575

I.   Federal Income Taxes

  The reconciliations of the net income (loss) reported in the
  accompanying Statement of Operations with the net income (loss)
  reported in the Partnership's federal income tax return for the
  years ended December 31, 1996, 1995 and 1994 are as follows:
</TABLE>
<TABLE>
<CAPTION>
                                     1996       1995       1994  

Net income (loss) per Statement
  <S>                            <C>         <C>       <C>
  of Operations                  $  482,943  $765,125  $(3,600,580)

     Book to tax difference due to 
       provision for credit loss         -         -      4,500,000

     Income (expense) recognized
       for tax not book             1,496,640     (3,998)      3,998

     Net income for federal income
       tax purposes                $1,979,583 $ 761,127  $   903,418
</TABLE>

  The allocation of net income for federal income tax purposes for
  1996 is as follows:
<TABLE>
<CAPTION>
                           Portfolio   Portfolio
                            Income      Expense        Total  

       <S>                <C>            <C>        <C>
       Limited Partners   $2,052,286     (92,499)   $1,959,787

        General Partners      20,730        (934)       19,796
                          $2,073,016   $ (93,433)   $1,979,583
</TABLE>
  
The basis of the Partnership's assets for tax
purposes exceeds its assets for financial
reporting purposes by approximately
$25,000,000 and $24,000,000 at December 31,
1996 and 1995, respectively.  The tax and book
basis of the Partnership's liabilities are
equal.