SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C. 20549
                                
                           FORM 10-KSB
                                
             Annual Report Under Section 13 or 15(d)
             Of The Securities Exchange Act Of 1934
                                
          For the Fiscal Year Ended:  December 31, 1997
                                
                Commission file number:  0-14263
                                
          AEI REAL ESTATE FUND 85-A LIMITED PARTNERSHIP
         (Name of Small Business Issuer in its Charter)

      State of Minnesota                41-1511293
(State or other Jurisdiction of     (I.R.S. Employer)
Incorporation or Organization)     Identification No.)

  1300 Minnesota World Trade Center, St. Paul, Minnesota 55101
            (Address of Principal Executive Offices)

                         (612) 227-7333
                   (Issuer's telephone number)

Securities registered pursuant to Section 12(b) of the Act:
                                 Name of each exchange on
     Title of each class             which registered
             None                          None

Securities registered pursuant to Section 12(g) of the Act:

                    Limited Partnership Units
                        (Title of class)
                                
Check  whether  the issuer (1) filed all reports required  to  be
filed  by Section 13 or 15(d) of the Securities Exchange  Act  of
1934  during the past 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

Check if disclosure of delinquent filers in response to Rule  405
of  Regulation  S-B  is  not  contained  in  this  Form,  and  no
disclosure  will  be contained, to the best of  the  registrant's
knowledge,   in   definitive  proxy  or  information   statements
incorporated by reference in Part III of this Form 10-KSB or  any
amendment to this Form 10-KSB.[X]

The Issuer's revenues for year ended December 31, 1997 were $539,329.

As  of  February 28, 1998, there were 7,065.128 Units of  limited
partnership interest in the registrant outstanding and  owned  by
nonaffiliates  of  the registrant, which Units had  an  aggregate
market  value (based solely on the price at which they were  sold
since there is no ready market for such Units) of $7,065,128.

               DOCUMENTS INCORPORATED BY REFERENCE

 The registrant has not incorporated any documents by reference
                        into this report.
                                
         Transitional Small Business Disclosure Format:
                                
                       Yes            No   [X]

                             PART I

ITEM 1.   DESCRIPTION OF BUSINESS.

        AEI  Real  Estate  Fund  85-A  Limited  Partnership  (the
"Partnership" or the "Registrant") is a limited partnership which
was  organized pursuant to the laws of the State of Minnesota  on
April  15,  1985.   The  registrant is  comprised  of  Net  Lease
Management  85-A, Inc. (NLM) as Managing General Partner,  Robert
P.  Johnson as the Individual General Partner, and purchasers  of
partnership  units as Limited Partners.  The Partnership  offered
for  sale up to $7,500,000 of limited partnership interests  (the
"Units")  (7,500  Units  at  $1,000  per  Unit)  pursuant  to   a
registration   statement  effective  February   8,   1985.    The
Partnership  commenced operations on April15, 1985  when  minimum
subscriptions  of  1,300 Limited Partnership  Units  ($1,300,000)
were  accepted.  The Partnership's offering terminated  June  20,
1985  when  the  maximum  subscription  limit  of  7,500  Limited
Partnership Units ($7,500,000) was reached.

        The Partnership was organized to acquire, initially on  a
debt-free   basis,  existing  and  newly  constructed  commercial
properties located in the United States, to lease such properties
to  tenants under triple net leases, to hold such properties  and
to  eventually sell such properties.  From subscription proceeds,
the  Partnership  purchased eight properties,  including  partial
interests in two properties, totaling $6,103,065.  The balance of
the   subscription  proceeds  was  applied  to  organization  and
syndication  costs,  working capital reserves and  distributions,
which  represented a return of capital.  The properties  are  all
commercial,  single  tenant buildings  leased  under  triple  net
leases.

       The Partnership will hold its properties until the General
Partners  determine  that the sale or other  disposition  of  the
properties   is   advantageous  in  view  of  the   Partnership's
investment  objectives.  In deciding whether to sell  properties,
the  General  Partners will consider factors  such  as  potential
appreciation,  net  cash flow and income tax considerations.   In
addition,  certain lessees have been granted options to  purchase
properties  after  a  specified portion of  the  lease  term  has
elapsed.   It is anticipated that the Partnership will  sell  its
properties  within  twelve  years after  acquisition.   Prior  to
commencing  the  liquidation  of  the  Partnership,  the  General
Partners may reinvest the proceeds from the sale of properties in
additional  properties,  provided that  sufficient  proceeds  are
distributed  to  the Limited Partners to pay  federal  and  state
income  taxes related to any taxable gain recognized as a  result
of  the  sale.  At any time prior to selling the properties,  the
Partnership may mortgage one or more of its properties in amounts
not exceeding 50% of the fair market value of the property.

Leases

       Although there are variations in the specific terms of the
leases,  the following is a summary of the general terms  of  the
Partnership's  leases.   The properties  are  leased  to  various
tenants  under  triple  net  leases,  which  are  classified   as
operating  leases.   Under  a triple net  lease,  the  lessee  is
responsible  for  all real estate taxes, insurance,  maintenance,
repairs  and  operating expenses for the property.   The  initial
lease  terms are for 5 to 20 years.  The leases provide for  base
annual  rental  payments,  payable in monthly  installments,  and
contain  rent  clauses which entitle the Partnership  to  receive
additional rent in future years based on stated rent increases or
if  gross  receipts  for  the property exceed  certain  specified
amounts, among other conditions.  The leases provide for  one  to
four  five-year  renewal options subject to the  same  terms  and
conditions as the initial lease.

ITEM 1.   DESCRIPTION OF BUSINESS. (Continued)

        On  March  20,  1995, the Partnership sold  the  Hardee's
restaurant in Sierra Vista, Arizona to an unrelated third  party.
The  Partnership  received net sales proceeds of $296,020,  which
resulted in a net loss of $166,000, which was recognized in 1994.

       On July 19, 1995, the Partnership sold the Fair Muffler in
Ashwaubenon,  Wisconsin to the lessee.  The Partnership  received
net  sale proceeds of $299,874, which resulted in a net  gain  of
$130,181.   At the time of sale, the cost and related accumulated
depreciation   of   the  property  was  $230,134   and   $60,441,
respectively.

        On  August  28, 1995, the Partnership sold  the  Hardee's
restaurant  in  Wayne, Nebraska to the lessee.   The  Partnership
received net sales proceeds of $474,530 which resulted in  a  net
gain  of  $150,989.  At the time of sale, the  cost  and  related
accumulated  depreciation  of  the  property  was  $447,944   and
$124,403, respectively.

        On  December  21,  1995,  the  Partnership  purchased  an
Applebee's  restaurant in Harlingen, Texas for  $1,393,470.   The
property is leased to Renaissant Development Corporation under  a
Lease Agreement with a primary term of 20 years and annual rental
payments of $156,400.

        On  February 14, 1996, the Partnership purchased  an  80%
interest   in  a  Tractor  Supply  Company  store  in  Maryville,
Tennessee for $837,058.  The property is leased to Tractor Supply
Company  under a Lease Agreement with a primary term of 14  years
and annual rental payments of $90,300.  The remaining interest in
the  property  was purchased by AEI Real Estate Fund  XV  Limited
Partnership, an affiliate of the Partnership.

Major Tenants

        During  1997,  five  of  the Partnership's  lessees  each
contributed  more  than  ten percent of the  Partnership's  total
rental revenue.  The major tenants in aggregate contributed  100%
of  the  Partnership's  total rental  revenue  in  1997.   It  is
anticipated  that, based on the minimum rental payments  required
under  the  leases, each major tenant will continue to contribute
more  than ten percent of the Partnership's total rental  revenue
in  1998 and future years.  Any failure of these major tenants or
business  concepts could materially affect the Partnership's  net
income and cash distributions.

Competition

        The  Partnership is a minor factor in the commercial real
estate  business.   There are numerous entities  engaged  in  the
commercial  real  estate  business which have  greater  financial
resources  than  the  Partnership.  At the time  the  Partnership
elects to dispose of its properties, the Partnership will  be  in
competition  with other persons and entities to find  buyers  for
its properties.

Employees

        The  Partnership  has  no direct  employees.   Management
services   are  performed  for  the  Partnership  by   AEI   Fund
Management, Inc., an affiliate of NLM.

ITEM 1.   DESCRIPTION OF BUSINESS. (Continued)

Year 2000

        AEI  Fund  Management, Inc. (AEI) performs all management
services  for  the Partnership.  AEI is currently  analyzing  its
computer hardware and software systems to determine what, if any,
resources  need to be dedicated regarding Year 2000 issues.   The
Partnership  does  not  anticipate  any  significant  operational
impact  or  incurring material costs as a result of AEI  becoming
Year 2000 compliant.

ITEM 2.   DESCRIPTION OF PROPERTIES.

Investment Objectives

        The  Partnership's investment objectives were to  acquire
existing or newly-developed commercial properties throughout  the
United  States that offer the potential for (i) preservation  and
protection  of  the  Partnership's capital; (ii)  partially  tax-
deferred  cash distributions from operations which  may  increase
through  rent  participation clauses or mandated rent  increases;
and  (iii) long-term capital gains through appreciation in  value
of   the  Partnership's  properties  realized  upon  sale.    The
Partnership  does not have a policy, and there is no  limitation,
as  to the amount or percentage of assets that may be invested in
any  one  property.  However, to the extent possible, the General
Partners  attempt  to  diversify the type  and  location  of  the
Partnership's properties.

Description of Properties

        The  Partnership's properties are all commercial,  single
tenant  buildings.  All the properties were acquired on  a  debt-
free  basis  and are leased to various tenants under  triple  net
leases, which are classified as operating leases. The Partnership
holds an undivided fee simple interest in the properties.  At any
time  prior  to  selling  the  properties,  the  Partnership  may
mortgage  one or more of its properties in amounts not  exceeding
50% of the fair market value of the property.

        The  Partnership's properties are subject to the  general
competitive conditions incident to the ownership of single tenant
investment  real estate.  Since each property is leased  under  a
long-term   lease,   there  is  little  competition   until   the
Partnership  decides to sell the property.   At  this  time,  the
Partnership will be competing with other real estate  owners,  on
both a national and local level, in attempting to find buyers for
the   properties.   In  the  event  of  a  tenant  default,   the
Partnership would be competing with other real estate owners, who
have  property vacancies, to attract a new tenant  to  lease  the
property.   The Partnership's tenants operate in industries  that
are  very  competitive and can be affected  by  factors  such  as
changes  in regional or local economies, seasonality and  changes
in consumer preference.

ITEM 2.   DESCRIPTION OF PROPERTIES. (Continued)

        The  following table is a summary of the properties  that
the Partnership acquired and owned as of December 31, 1997.

                                 Total Property              Annual     Annual
                     Purchase     Acquisition                Lease     Rent Per
Property               Date         Costs      Lessee        Payment    Sq. Ft.
                                                       
Rio Bravo Restaurant                        Innovative
 St. Paul, MN                               Restaurant
  (45%)             12/13/85   $  795,861   Concepts, Inc.   $  65,711  $ 12.81

Jack-In-The-Box Restaurant                   Carl Karcher
 Fort Worth, TX     12/19/85   $1,005,586  Enterprises, Inc. $ 135,582  $ 34.71

Hops Grill & Bar Restaurant                  Hops of Palm
 Palm Harbor, FL     3/21/86   $1,094,373    Harbor, Inc.    $  82,627  $ 16.11

Applebee's Restaurant                      Renaissant Develop-
 Harlingen, TX      12/21/95   $1,393,470     ment Corp.     $ 156,400  $ 31.32

Tractor Supply
Company Store
 Maryville, TN                                  Tractor
    (80%)            2/14/96   $837,058     Supply Company   $  90,300  $  5.93

        The  properties  listed above with  a  partial  ownership
percentage  are  owned with affiliates of the Partnership  and/or
unrelated  third  parties.  The remaining interests  in  the  Rio
Bravo restaurant are owned by Net Lease Income & Growth Fund 84-A
Limited  Partnership and unrelated third parties.  The  remaining
interest in the Tractor Supply Company store is owned by AEI Real
Estate Fund XV Limited Partnership.

        The Partnership accounts for properties owned as tenants-
in-common  with  affiliated Partnerships and/or  unrelated  third
parties  using  the  proportionate  consolidation  method.   Each
tenant-in-common  owns  a  separate, undivided  interest  in  the
properties.   Any  tenant-in-common that holds more  than  a  50%
interest  does  not control decisions over the  other  tenant-in-
common  interests.   The financial statements reflect  only  this
Partnership's percentage share of the properties' land,  building
and equipment, liabilities, revenues and expenses.

        The initial Lease terms are for 20 years, except for  the
Palm  Harbor  property which is 5 years and  the  Tractor  Supply
Company store which is 14 years.  The Leases have renewal options
which may extend the Lease term an additional 5 to 20 years.  The
Palm Harbor Lease has been extended to April 30, 2002.

       Pursuant to the Lease Agreements, the tenants are required
to provide proof of adequate insurance coverage on the properties
they  occupy.   The General Partners believe the  properties  are
adequately covered by insurance and consider the properties to be
well-maintained and sufficient for the Partnership's operations.

ITEM 2.   DESCRIPTION OF PROPERTIES. (Continued)

         For  tax  purposes,  the  Partnership's  properties  are
depreciated  under  either the Accelerated Cost  Recovery  System
(ACRS)  or the Modified Accelerated Cost Recovery System (MACRS),
depending on the date when it was placed in service.  The largest
depreciable  component  of a property is the  building  which  is
depreciated, using the straight-line method, over either 19 years
(ACRS)  or  31.5  years  or  40  years  (MACRS).   The  remaining
depreciable  components of a property are personal  property  and
land  improvements  which are depreciated, using  an  accelerated
method, over 5 and 15 years, respectively.  Since the Partnership
has  tax-exempt Partners, the Partnership is subject to the rules
of  Section 168(h)(6) of the Internal Revenue Code which requires
a  percentage  of  the properties' depreciable components  to  be
depreciated over longer lives using the straight-line method.  In
general  the  federal  tax  basis  of  the  properties  for   tax
depreciation  purposes  is  the  same  as  the  basis  for   book
depreciation purposes.

       During the last five years or since the date of purchase,
if purchased after December 31, 1992, all properties were 100
percent occupied by the lessees.

ITEM 3.   LEGAL PROCEEDINGS.

       None.

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

       None.


                             PART II
                                
ITEM 5.   MARKET FOR THE REGISTRANT'S PARTNERSHIP UNITS AND
          RELATED SECURITY HOLDER MATTERS.

        As of December 31, 1997, there were 689 holders of record
of the registrant's Limited Partnership Units.  There is no other
class  of  security outstanding or authorized.  The  registrant's
Units  are  not  a traded security in any market.   However,  the
Partnership  may  purchase Units from Limited Partners  who  have
tendered  their  Units to the Partnership.   Such  Units  may  be
acquired  at  a  discount.  The Partnership is not  obligated  to
purchase  in any year more than 5% of the total number  of  Units
originally sold.  In no event shall the Partnership be  obligated
to  purchase  Units if, in the sole discretion  of  the  Managing
General  Partner,  such  purchase would  impair  the  capital  or
operation of the Partnership.

        During 1997, one Limited Partner redeemed a total of five
Partnership  Units for $2,199 in accordance with the  Partnership
Agreement.   In  prior  years, a total  of  52  Limited  Partners
redeemed  415.37 Partnership Units for $313,122.  The redemptions
increase  the remaining Limited Partners' ownership  interest  in
the Partnership.

        Cash distributions of $4,025 and $3,898 were made to  the
General  Partners  and $396,299 and $375,600  were  made  to  the
Limited   Partners   in   1997  and  1996,   respectively.    The
distributions  were made on a quarterly basis and  represent  Net
Cash   Flow,  as  defined,  except  as  discussed  below.   These
distributions  should  not be compared  with  dividends  paid  on
capital stock by corporations.

        As  part  of the Limited Partner distributions  discussed
above,  the  Partnership  distributed  $4,223  of  proceeds  from
property  sales in 1996.  The distributions reduced  the  Limited
Partners' Adjusted Capital Contributions.

ITEM 6.   MANAGEMENT'S DISCUSSION AND ANALYSIS.

Results of Operations

        For  the  years  ended December 31, 1997  and  1996,  the
Partnership  recognized rental income of $532,076  and  $513,717,
respectively.   During the same periods, the  Partnership  earned
investment income of $7,253 and $10,129, respectively.  In  1997,
rental income increased mainly as a result of the reinvestment of
net  sale proceeds in additional properties discussed below.  The
increase  in rental income was partially offset by a decrease  in
investment  income  earned  on the  net  proceeds  prior  to  the
purchase of the additional properties.

        During  the years ended December 31, 1997 and  1996,  the
Partnership   paid   Partnership   administration   expenses   to
affiliated  parties of $89,979 and $87,152, respectively.   These
administration  expenses  include  costs  associated   with   the
management of the properties, processing distributions, reporting
requirements  and correspondence to the Limited Partners.  During
the   same   periods,   the  Partnership   incurred   Partnership
administration  and property management expenses  from  unrelated
parties  of  $13,355 and $15,569, respectively.   These  expenses
represent  direct payments to third parties for legal and  filing
fees,  direct administrative costs, outside audit and  accounting
costs, taxes, insurance and other property costs.

       As of December 31, 1997, the Partnership's annualized cash
distribution  rate  was  6.50%, based  on  the  Adjusted  Capital
Contribution.   Distributions of Net Cash  Flow  to  the  General
Partners were subordinated to the Limited Partners as required in
the Partnership Agreement.  As a result, 99% of distributions and
income  were allocated to Limited Partners and 1% to the  General
Partners.

        Inflation  has  had  a  minimal  effect  on  income  from
operations.   It is expected that increases in sales  volumes  of
the  tenants, due to inflation and real sales growth, will result
in  an  increase  in rental income over the term of  the  leases.
Inflation  also  may  cause  the  Partnership's  real  estate  to
appreciate in value.  However, inflation and changing prices  may
also  have  an  adverse impact on the operating  margins  of  the
properties' tenants which could impair their ability to pay  rent
and subsequently reduce the Partnership's Net Cash Flow available
for distributions.

        AEI  Fund  Management, Inc. (AEI) performs all management
services  for  the Partnership.  AEI is currently  analyzing  its
computer hardware and software systems to determine what, if any,
resources  need to be dedicated regarding Year 2000 issues.   The
Partnership  does  not  anticipate  any  significant  operational
impact  or  incurring material costs as a result of AEI  becoming
Year 2000 compliant.

Liquidity and Capital Resources

        During  1997,  the Partnership's cash balances  increased
$37,542 as the Partnership distributed less cash to Partners than
it  generated  from operating activities.  Net cash  provided  by
operating activities increased from $419,762 in 1996 to  $431,734
in 1997 due to an increase in income from the reinvestment of net
sales proceeds in additional properties.

        In  1996,  net  cash  used for investing  activities  was
$834,725, as the Partnership completed the reinvestment  of  sale
proceeds  in an additional property.  On February 14,  1996,  the
Partnership  purchased  an   80% interest  in  a  Tractor  Supply
Company store in Maryville, Tennessee for $837,058.  The property
is  leased to Tractor Supply Company under a Lease Agreement with
a primary term of 14 years and annual rental payments of $90,300.
The  remaining interest in the property was purchased by AEI Real
Estate   Fund  XV  Limited  Partnership,  an  affiliate  of   the
Partnership.


ITEM 6.   MANAGEMENT'S DISCUSSION AND ANALYSIS.  (Continued)

       The Partnership's primary use of cash flow is distribution
and  redemption  payments to Partners.  The Partnership  declares
its  regular  quarterly  distributions before  the  end  of  each
quarter and pays the distribution in the first week after the end
of  each quarter.  The Partnership attempts to maintain a  stable
distribution  rate from quarter to quarter.  Redemption  payments
are  paid  to  redeeming Partners in the fourth quarter  of  each
year.  In 1997, net cash used for financing activities decreased,
when  compared to 1996, as a result of an additional distribution
of  net sale proceeds of approximately $75,000, which was accrued
in December, 1995, but not paid until January, 1996.

        The  Partnership may acquire Units from Limited  Partners
who have tendered their Units to the Partnership.  Such Units may
be  acquired at a discount.  The Partnership is not obligated  to
purchase  in any year more than 5% of the total number  of  Units
originally sold.  In no event shall the Partnership be  obligated
to  purchase  Units if, in the sole discretion  of  the  Managing
General  Partner,  such  purchase would  impair  the  capital  or
operation of the Partnership.

        During 1997, one Limited Partner redeemed a total of five
Partnership  Units for $2,199 in accordance with the  Partnership
Agreement.  The Partnership acquired these Units using  Net  Cash
Flow  from  operations.  In prior years, a total  of  52  Limited
Partners  redeemed  415.37 Partnership Units for  $313,122.   The
redemptions  increase the remaining Limited  Partners'  ownership
interest in the Partnership.

       The continuing rent payments from the properties should be
adequate   to  fund  continuing  distributions  and  meet   other
Partnership obligations on both a short-term and long-term basis.

ITEM 7.   FINANCIAL STATEMENTS.

       See accompanying index to financial statements.
                                
          AEI REAL ESTATE FUND 85-A LIMITED PARTNERSHIP

                  INDEX TO FINANCIAL STATEMENTS




                                                                

Report of Independent Auditors                                    

Balance Sheet as of December 31, 1997 and 1996                    

Statements for the Years Ended December 31, 1997 and 1996:

     Income                                                       

     Cash Flows                                                   

     Changes in Partners' Capital                                

Notes to Financial Statements                      

                                
                                
                                
                 REPORT OF INDEPENDENT AUDITORS


To the Partners:
AEI Real Estate Fund 85-A Limited Partnership
St. Paul, Minnesota



      We  have audited the accompanying balance sheet of AEI REAL
ESTATE   FUND  85-A  LIMITED  PARTNERSHIP  (a  Minnesota  limited
partnership)  as  of December 31, 1997 and 1996 and  the  related
statements of income, cash flows and changes in partners' capital
for  the  years then ended.  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.

      In  our opinion, the financial statements referred to above
present  fairly, in all material respects, the financial position
of   AEI  Real  Estate  Fund  85-A  Limited  Partnership  as   of
December31, 1997 and 1996, and the results of its operations  and
its  cash  flows  for  the years then ended, in  conformity  with
generally accepted accounting principles.



Minneapolis, Minnesota             Boulay, Heutmaker, Zibell & Co. P.L.L.P.
February 4, 1998                   Certified Public Accountants


<PAGE>                                
          AEI REAL ESTATE FUND 85-A LIMITED PARTNERSHIP
                                
                          BALANCE SHEET
                                
                           DECEMBER 31
                                
                             ASSETS
                                
                                
                                                    1997             1996

CURRENT ASSETS:
  Cash and Cash Equivalents                    $   174,683       $   137,141

INVESTMENTS IN REAL ESTATE:
  Land                                           1,877,226         1,877,226
  Buildings and Equipment                        3,249,122         3,249,122
  Accumulated Depreciation                        (999,929)         (896,171)
                                                -----------       -----------
      Net Investments in Real Estate             4,126,419         4,230,177
                                                -----------       -----------
          Total Assets                         $ 4,301,102       $ 4,367,318
                                                ===========       ===========


                        LIABILITIES AND PARTNERS' CAPITAL

CURRENT LIABILITIES:
  Payable to AEI Fund Management, Inc.         $    12,719       $    16,980
  Distributions Payable                             92,893            84,562
                                                -----------       -----------
      Total Current Liabilities                    105,612           101,542
                                                -----------       -----------
PARTNERS' CAPITAL (DEFICIT):
  General Partners                                 (36,144)          (35,441)
  Limited Partners, $1,000 Unit value;
   7,500 Units authorized and issued;
   7,080 and 7,085 outstanding in 1997
   and 1996, respectively                        4,231,634         4,301,217
                                                -----------       -----------
    Total Partners' Capital                      4,195,490         4,265,776
                                                -----------       -----------
      Total Liabilities and Partners' Capital  $ 4,301,102       $ 4,367,318
                                                ===========       ===========


 The accompanying notes to financial statements are an integral
                     part of this statement.
</PAGE>
<PAGE>

          AEI REAL ESTATE FUND 85-A LIMITED PARTNERSHIP
                                
                       STATEMENT OF INCOME
                                
                 FOR THE YEARS ENDED DECEMBER 31


                                                    1997            1996

INCOME:
  Rent                                          $  532,076       $  513,717
  Investment Income                                  7,253           10,129
                                                -----------      -----------
      Total Income                                 539,329          523,846
                                                -----------      -----------

EXPENSES:
  Partnership Administration - Affiliates           89,979           87,152
  Partnership Administration and Property
     Management - Unrelated Parties                 13,355           15,569
  Depreciation                                     103,758          103,461
                                                -----------      -----------
      Total Expenses                               207,092          206,182
                                                -----------      -----------

NET INCOME                                     $   332,237      $   317,664
                                                ===========      ===========

NET INCOME ALLOCATED:
  General Partners                             $     3,322      $     3,177
  Limited Partners                                 328,915          314,487
                                                -----------      -----------
                                               $   332,237      $   317,664
                                                ===========      ===========

NET INCOME PER LIMITED PARTNERSHIP UNIT
(7,083 and 7,101 weighted average Units outstanding
 in 1997 and 1996, respectively)               $     46.44      $     44.29
                                                ===========      ===========



 The accompanying notes to financial statements are an integral
                     part of this statement.

</PAGE>
<PAGE>                                
          AEI REAL ESTATE FUND 85-A LIMITED PARTNERSHIP
                                
                     STATEMENT OF CASH FLOWS
                                
                 FOR THE YEARS ENDED DECEMBER 31


                                                      1997           1996

CASH FLOWS FROM OPERATING ACTIVITIES:
 Net Income                                       $   332,237     $   317,664

 Adjustments To Reconcile Net Income
 To Net Cash Provided By Operating Activities:
     Depreciation                                     103,758         103,461
     Decrease in Receivables                                0           8,514
     Decrease in Payable to
        AEI Fund Management, Inc.                      (4,261)         (9,877)
                                                   -----------     -----------
       Total Adjustments                               99,497         102,098
                                                   -----------     -----------
       Net Cash Provided By
           Operating Activities                       431,734         419,762
                                                   -----------     -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Investments in Real Estate                                0        (834,725)
                                                   -----------     -----------
       Net Cash Used For
           Investing Activities                             0        (834,725)
                                                   -----------     -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
  Increase (Decrease) in Distributions Payable          8,331         (75,736)
  Distributions to Partners                          (400,302)       (379,394)
  Redemption Payments                                  (2,221)        (10,398)
                                                   -----------     -----------
       Net Cash Used For
        Financing Activities                         (394,192)       (465,528)
                                                   -----------     -----------
NET INCREASE (DECREASE) IN CASH
  AND CASH EQUIVALENTS                                 37,542        (880,491)

CASH AND CASH EQUIVALENTS, beginning of period        137,141       1,017,632
                                                   -----------     -----------
CASH AND CASH EQUIVALENTS, end of period          $   174,683     $   137,141
                                                   ===========     ===========


 The accompanying notes to financial statements are an integral
                     part of this statement.
</PAGE>
<PAGE>

          AEI REAL ESTATE FUND 85-A LIMITED PARTNERSHIP
                                
            STATEMENT OF CHANGES IN PARTNERS' CAPITAL
                                
                 FOR THE YEARS ENDED DECEMBER 31


                                                                    Limited
                                                                  Partnership
                                General      Limited                 Units
                                Partners     Partners     Total   Outstanding


BALANCE, December 31, 1995   $ (34,720)  $ 4,372,624  $ 4,337,904    7,106.63

  Distributions                 (3,794)     (375,600)    (379,394)

  Redemption Payments             (104)      (10,294)     (10,398)     (22.00)

  Net Income                     3,177       314,487      317,664
                              ---------   -----------  -----------  ----------
BALANCE, December 31, 1996     (35,441)    4,301,217    4,265,776    7,084.63

  Distributions                 (4,003)     (396,299)    (400,302)

  Redemption Payments              (22)       (2,199)      (2,221)      (5.00)

  Net Income                     3,322       328,915      332,237
                              ---------   -----------  -----------  ----------
BALANCE, December 31, 1997   $ (36,144)  $ 4,231,634  $ 4,195,490    7,079.63
                              =========   ===========  ===========  ==========


 The accompanying notes to financial statements are an integral
                     part of this statement.

</PAGE>


          AEI REAL ESTATE FUND 85-A LIMITED PARTNERSHIP
                                
                  NOTES TO FINANCIAL STATEMENTS
                                
                   DECEMBER 31, 1997 AND 1996


(1)  Organization -

     AEI  Real Estate Fund 85-A Limited Partnership (Partnership)
     was  formed  to  acquire and lease commercial properties  to
     operating tenants.  The Partnership's operations are managed
     by  Net  Lease  Management 85-A, Inc.  (NLM),  the  Managing
     General Partner of the Partnership.  Robert P. Johnson,  the
     President  and  sole  shareholder  of  NLM,  serves  as  the
     Individual General Partner of the Partnership. An  affiliate
     of  NLM,  AEI  Fund  Management,  Inc.  (AEI)  performs  the
     administrative and operating functions for the Partnership.
     
     The   terms   of  the  Partnership  offering  call   for   a
     subscription  price of $1,000 per Limited Partnership  Unit,
     payable   on  acceptance  of  the  offer.   The  Partnership
     commenced   operations  on  April  15,  1985  when   minimum
     subscriptions    of   1,300   Limited   Partnership    Units
     ($1,300,000)  were  accepted.   The  Partnership's  offering
     terminated  on  June 20, 1985 when the maximum  subscription
     limit  of  7,500 Limited Partnership Units ($7,500,000)  was
     reached.
     
     Under  the  terms of the Limited Partnership Agreement,  the
     Limited  Partners and General Partners contributed funds  of
     $7,500,000  and $1,000, respectively.  During the  operation
     of the Partnership, any Net Cash Flow, as defined, which the
     General Partners determine to distribute will be distributed
     90% to the Limited Partners and 10% to the General Partners;
     provided,  however, that such distributions to  the  General
     Partners will be subordinated to the Limited Partners  first
     receiving an annual, noncumulative distribution of Net  Cash
     Flow equal to 10% of their Adjusted Capital Contribution, as
     defined,  and, provided further, that in no event  will  the
     General Partners receive less than 1% of such Net Cash  Flow
     per  annum.  Distributions to Limited Partners will be  made
     pro rata by Units.
     
     Any  Net  Proceeds  of Sale, as defined, from  the  sale  or
     financing of the Partnership's properties which the  General
     Partners determine to distribute will, after provisions  for
     debts  and  reserves, be paid in the following  manner:  (i)
     first,  99%  to the Limited Partners and 1% to  the  General
     Partners until the Limited Partners receive an amount  equal
     to:  (a)  their Adjusted Capital Contribution  plus  (b)  an
     amount  equal  to 6% of their Adjusted Capital  Contribution
     per  annum, cumulative but not compounded, to the extent not
     previously distributed from Net Cash Flow; (ii) next, 99% to
     the  Limited  Partners and 1% to the General Partners  until
     the Limited Partners receive an amount equal to 14% of their
     Adjusted Capital Contribution per annum, cumulative but  not
     compounded, to the extent not previously distributed;  (iii)
     next, to the General Partners until cumulative distributions
     to the General Partners under Items (ii) and (iii) equal 15%
     of cumulative distributions to all Partners under Items (ii)
     and (iii).  Any remaining balance will be distributed 85% to
     the  Limited  Partners  and  15% to  the  General  Partners.
     Distributions to the Limited Partners will be made pro  rata
     by Units.

          AEI REAL ESTATE FUND 85-A LIMITED PARTNERSHIP
                                
                  NOTES TO FINANCIAL STATEMENTS
                                
                   DECEMBER 31, 1997 AND 1996


(1)  Organization - (Continued)
     
     For  tax  purposes,  profits  from  operations,  other  than
     profits  attributable  to  the  sale,  exchange,  financing,
     refinancing   or  other  disposition  of  the  Partnership's
     property,  will  be  allocated first in the  same  ratio  in
     which,  and  to the extent, Net Cash Flow is distributed  to
     the Partners for such year.  Any additional profits will  be
     allocated 90% to the Limited Partners and 10% to the General
     Partners.   In the event no Net Cash Flow is distributed  to
     the  Limited  Partners,  90% of  each  item  of  Partnership
     income,  gain  or credit for each respective year  shall  be
     allocated to the Limited Partners, and 10% of each such item
     shall be allocated to the General Partners.  Net losses from
     operations will be allocated 98% to the Limited Partners and
     2% to the General Partners.
     
     For  tax purposes, profits arising from the sale, financing,
     or  other disposition of the Partnership's property will  be
     allocated  in  accordance with the Partnership Agreement  as
     follows:  (i) first, to those Partners with deficit balances
     in  their capital accounts in an amount equal to the sum  of
     such  deficit  balances; (ii) second,  99%  to  the  Limited
     Partners  and 1% to the General Partners until the aggregate
     balance in the Limited Partners' capital accounts equals the
     sum  of the Limited Partners' Adjusted Capital Contributions
     plus  an  amount  equal  to 14% of  their  Adjusted  Capital
     Contributions  per annum, cumulative but not compounded,  to
     the  extent  not previously allocated; (iii) third,  to  the
     General Partners until cumulative allocations to the General
     Partners equal 15% of cumulative allocations.  Any remaining
     balance  will  be allocated 85% to the Limited Partners  and
     15%  to the General Partners.  Losses will be allocated  98%
     to the Limited Partners and 2% to the General Partners.
     
     The  General Partners are not required to currently  fund  a
     deficit   capital   balance.   Upon   liquidation   of   the
     Partnership or withdrawal by a General Partner, the  General
     Partners will contribute to the Partnership an amount  equal
     to  the  lesser  of  the deficit balances in  their  capital
     accounts  or  1%  of  total Limited  Partners'  and  General
     Partners' capital contributions.
     
(2)  Summary of Significant Accounting Policies -

     Newly Issued Accounting Standards
     
       In June, 1997, Statement of Financial Accounting Standards
       No.  130 "Reporting Comprehensive Income" was approved for
       issuance  for  fiscal years beginning after  December  15,
       1997.   The  Partnership  adopted this  Statement  in  the
       fourth quarter of 1997.  The effect of this Statement  has
       been   determined  that  net  income/loss  for   financial
       statements and comprehensive income/loss is primarily  the
       same in all material respects.
       
     Financial Statement Presentation

       The  accounts  of  the Partnership are maintained  on  the
       accrual  basis of accounting for both federal  income  tax
       purposes and financial reporting purposes.
       

          AEI REAL ESTATE FUND 85-A LIMITED PARTNERSHIP
                                
                  NOTES TO FINANCIAL STATEMENTS
                                
                   DECEMBER 31, 1997 AND 1996

(2)  Summary of Significant Accounting Policies - (Continued)

     Accounting Estimates
     
       Management  uses  estimates and assumptions  in  preparing
       these  financial statements in accordance  with  generally
       accepted  accounting  principles.   Those  estimates   and
       assumptions may affect the reported amounts of assets  and
       liabilities,  the  disclosure  of  contingent  assets  and
       liabilities,  and  the  reported  revenues  and  expenses.
       Actual results could differ from those estimates.
       
       The  Partnership regularly assesses whether market  events
       and conditions indicate that it is reasonably possible  to
       recover  the carrying amounts of its investments  in  real
       estate  from  future operations and sales.   A  change  in
       those  market events and conditions could have a  material
       effect on the carrying amount of its real estate
       
     Cash Concentrations of Credit Risk
     
       At  times  throughout  the year,  the  Partnership's  cash
       deposited  in  financial  institutions  may  exceed   FDIC
       insurance limits.
       
     Statement of Cash Flows
     
       For  purposes  of  reporting cash  flows,  cash  and  cash
       equivalents  may include cash in checking,  cash  invested
       in   money   market  accounts,  certificates  of  deposit,
       federal  agency notes and commercial paper with a term  of
       three months or less.
     
     Income Taxes
     
       The  income or loss of the Partnership for federal  income
       tax  reporting  purposes is includable in the  income  tax
       returns of the partners.  Accordingly, no recognition  has
       been  given to income taxes in the accompanying  financial
       statements.
       
       The  tax  return, the qualification of the Partnership  as
       such  for  tax  purposes, and the amount of  distributable
       Partnership  income or loss are subject to examination  by
       federal   and  state  taxing  authorities.   If  such   an
       examination  results  in  changes  with  respect  to   the
       Partnership  qualification or in changes to  distributable
       Partnership  income  or loss, the taxable  income  of  the
       partners would be adjusted accordingly.

     Real Estate

       The  Partnership's real estate is leased under triple  net
       leases  classified as operating leases.   The  Partnership
       recognizes  rental revenue on the accrual basis  according
       to  the terms of the individual leases.  For leases  which
       contain  cost  of  living  increases,  the  increases  are
       recognized in the year in which they are effective.
       

          AEI REAL ESTATE FUND 85-A LIMITED PARTNERSHIP
                                
                  NOTES TO FINANCIAL STATEMENTS
                                
                   DECEMBER 31, 1997 AND 1996

(2)  Summary of Significant Accounting Policies - (Continued)

       Real  estate is recorded at the lower of cost or estimated
       net  realizable value.  The Financial Accounting Standards
       Board  issued  Statement  No.  121,  "Accounting  for  the
       Impairment of Long-Lived Assets and for Long-Lived  Assets
       to   be   Disposed  Of"  which  was  effective   for   the
       Partnership's fiscal year ended December 31,  1996.   This
       standard  requires the Partnership to compare the carrying
       amount  of  its  properties to the estimated  future  cash
       flows  expected  to  result  from  the  property  and  its
       eventual  disposition.  If the sum of the expected  future
       cash  flows  is  less  than the  carrying  amount  of  the
       property,  the  Statement  requires  the  Partnership   to
       recognize  an impairment loss by the amount by  which  the
       carrying amount of the property exceeds the fair value  of
       the property.
       
       The  Partnership  has capitalized as Investments  in  Real
       Estate   certain   costs  incurred  in  the   review   and
       acquisition  of the properties.  The costs were  allocated
       to the land, buildings and equipment.
       
       The   buildings  and  equipment  of  the  Partnership  are
       depreciated  using the straight-line method for  financial
       reporting purposes based on estimated useful lives  of  30
       years and 10 years respectively.
       
       The  Partnership accounts for properties owned as tenants-
       in-common  with  affiliated Partnerships and/or  unrelated
       third   parties   using  the  proportionate  consolidation
       method.   Each tenant-in-common owns a separate, undivided
       interest  in  the  properties.  Any tenant-in-common  that
       holds  more than a 50% interest does not control decisions
       over  the other tenant-in-common interests.  The financial
       statements  reflect  only  this  Partnership's  percentage
       share  of  the  properties' land, building and  equipment,
       liabilities, revenues and expenses.

(3)  Related Party Transactions -

     The  Partnership  owns  a  45% interest  in  the  Rio  Bravo
     restaurant.   The remaining interests in this  property  are
     owned  by  Net  Lease  Income &  Growth  Fund  84-A  Limited
     Partnership, an affiliate of the Partnership, and  unrelated
     third parties.  The Partnership owns an 80% interest in  the
     Tractor  Supply  Company store.  The remaining  interest  in
     this  property is owned by AEI Real Estate Fund  XV  Limited
     Partnership, an affiliate of the Partnership.


          AEI REAL ESTATE FUND 85-A LIMITED PARTNERSHIP
                                
                  NOTES TO FINANCIAL STATEMENTS
                                
                   DECEMBER 31, 1997 AND 1996

(3)  Related Party Transactions - (Continued)

     AEI   and  NLM  received  the  following  compensation   and
     reimbursements for costs and expenses from the Partnership:

                                    Total Incurred by the Partnership
                                     for the Years Ended December 31

                                                      1997           1996

a.AEI and NLM are reimbursed for all costs
  incurred in connection with managing the
  Partnership's operations, maintaining the
  Partnership's books and communicating
  the results of operations to the Limited
  Partners.                                        $  89,979      $  87,152
                                                    =========      =========

b.AEI and NLM are reimbursed for all direct
  expenses they have paid on the Partnership's
  behalf to third parties.  These expenses included
  printing costs, interest, legal and filing fees,
  direct administrative costs, outside audit and 
  accounting costs, taxes, insurance and other 
  property costs.                                  $  13,355      $  15,569
                                                    =========      =========

c.AEI is reimbursed for all property acquisition
  costs incurred by it in acquiring properties on
  behalf of the Partnership.  The amounts are net
  of financing and commitment fees and expense
  reimbursements received by the Partnership from
  the lessees in the amount of $-0- and $22,020
  for 1997 and 1996, respectively.                 $       0      $ (22,075)
                                                    =========      =========


     The  payable  to  AEI Fund Management, Inc.  represents  the
     balance due for the services described in 3a, b and c.  This
     balance is non-interest bearing and unsecured and is  to  be
     paid in the normal course of business.


          AEI REAL ESTATE FUND 85-A LIMITED PARTNERSHIP
                                
                  NOTES TO FINANCIAL STATEMENTS
                                
                   DECEMBER 31, 1997 AND 1996

(4)  Investments in Real Estate -

     The  Partnership  leases its properties to  various  tenants
     through  triple  net leases, which have been  classified  as
     operating  leases.  Under a triple net lease, the lessee  is
     responsible   for   all   real  estate   taxes,   insurance,
     maintenance, repairs and operating expenses of the property.
     The  initial  Lease terms are for 20 years, except  for  the
     Palm Harbor property which is 5 years and the Tractor Supply
     Company  store which is 14 years.  The Leases  have  renewal
     options which may extend the Lease term an additional  5  to
     20  years.  The Palm Harbor Lease has been extended to April
     30,  2002.   The  Leases contain clauses which  entitle  the
     Partnership  to  receive additional rent  in  future  years,
     based on stated rent increases or if gross receipts for  the
     property  exceed  certain  specified  amounts,  among  other
     conditions.
     
     The  Partnership's  properties are all  commercial,  single-
     tenant buildings.  The Rio Bravo was constructed in 1984 and
     acquired  in  1985.  The Jack-In-The-Box was  completed  and
     acquired  in  1985.  The Palm Harbor property was  completed
     and  acquired  in 1986.  The Applebee's in Harlingen,  Texas
     and the Tractor Supply Company store in Maryville, Tennessee
     were  completed and acquired in 1995 and 1996, respectively.
     There   have  been  no  costs  capitalized  as  improvements
     subsequent to the acquisitions.

     The  cost  of  the  properties and the  related  accumulated
     depreciation at December 31, 1997 are as follows:

                                       Buildings and              Accumulated
Property                     Land        Equipment      Total     Depreciation

Rio Bravo, St. Paul, MN   $  289,776   $  506,085   $  795,861      $288,271
Jack-In-The-Box,
  Fort Worth, TX             498,862      506,724    1,005,586       267,236
Hops Grill and Bar,
  Palm Harbor, FL            484,570      609,803    1,094,373       321,114
Applebee's, Harlingen, TX    450,395      943,075    1,393,470        76,982
Tractor Supply Company,
   Maryville, TN             153,623      683,435      837,058        46,326
                          -----------  -----------  -----------   -----------
                         $ 1,877,226  $ 3,249,122  $ 5,126,348   $   999,929
                          ===========  ===========  ===========   ===========


          AEI REAL ESTATE FUND 85-A LIMITED PARTNERSHIP
                                
                  NOTES TO FINANCIAL STATEMENTS
                                
                   DECEMBER 31, 1997 AND 1996

(4)  Investments in Real Estate - (Continued)

     The   minimum  future  rentals  on  the  Leases  for   years
     subsequent to December 31, 1997 are as follows:

                       1998          $   534,010
                       1999              550,822
                       2000              555,233
                       2001              559,756
                       2002              520,622
                       Thereafter      5,080,673
                                      -----------
                                     $ 7,801,116
                                      ===========

     In  1997  and  1996,  the Partnership recognized  contingent
     rents of $2,259 and $19,579, respectively.

(5)  Major Tenants -

     The following schedule presents rent revenue from individual
     tenants,   or  affiliated  groups  of  tenants,   who   each
     contributed more than ten percent of the Partnership's total
     rent revenue for the years ended December 31:
     
                                                   1997             1996
    Tenants                       Industry

    Carl Karcher
     Enterprises, Inc.             Restaurant     $ 137,841       $ 135,582
    Hops of Palm Harbor, Inc.      Restaurant        81,824          78,948
    Innovative Restaurant
     Concepts, Inc.                Restaurant        65,711          63,385
    Renaissant Development Corp.   Restaurant       156,400         156,400
    Tractor Supply Company         Retail            90,300          79,402
                                                   ---------       ---------

     Aggregate rent revenue of major tenants      $ 532,076       $ 513,717
                                                   =========       =========

     Aggregate rent revenue of major tenants as
     a percentage of total rent revenue                100%            100%
                                                   =========       =========

          AEI REAL ESTATE FUND 85-A LIMITED PARTNERSHIP

                  NOTES TO FINANCIAL STATEMENTS

                   DECEMBER 31, 1997 AND 1996

(6)  Partners' Capital -

     Cash  distributions of $4,025 and $3,898 were  made  to  the
     General Partners and $396,299 and $375,600 were made to  the
     Limited  Partners for the years ended December 31, 1997  and
     1996,  respectively.   The  Limited Partners'  distributions
     represent  $55.95  and $52.89 per Limited  Partnership  Unit
     outstanding using 7,083 and 7,101weighted average  Units  in
     1997  and  1996, respectively.  The distributions  represent
     $46.13  and  $42.84  per Unit of Net Income  and  $9.82  and
     $10.05 per Unit of return of Contributed Capital in 1997 and
     1996, respectively.
     
     As  part  of  the  Limited  Partner distributions  discussed
     above,  the Partnership distributed $4,223 of proceeds  from
     property  sales  in  1996.   The distributions  reduced  the
     Limited Partners' Adjusted Capital Contributions.
     
     Distributions  of  Net  Cash Flow to  the  General  Partners
     during  1997  and  1996  were subordinated  to  the  Limited
     Partners  as  required in the Partnership Agreement.   As  a
     result,  99%  of distributions and income were allocated  to
     the Limited Partners and 1% to the General Partners.
     
     The  Partnership may acquire Units from Limited Partners who
     have  tendered their Units to the Partnership.   Such  Units
     may  be  acquired  at  a discount.  The Partnership  is  not
     obligated to purchase in any year more than 5% of the  total
     number  of  Units  originally sold.  In no event  shall  the
     Partnership be obligated to purchase Units if, in  the  sole
     discretion  of  the Managing General Partner, such  purchase
     would impair the capital or operation of the Partnership.
     
     During  1997, one Limited Partner redeemed a total  of  five
     Partnership  Units  for  $2,199  in  accordance   with   the
     Partnership Agreement.  The Partnership acquired these Units
     using  Net Cash Flow from operations.  In 1996, six  Limited
     Partners  redeemed  a  total of  22  Partnership  Units  for
     $10,294.   The  redemptions increase the  remaining  Limited
     Partners' ownership interest in the Partnership.
     
     After  the  effect of redemptions and the return of  capital
     from   the   sale   of   property,  the   Adjusted   Capital
     Contribution,  as defined in the Partnership  Agreement,  is
     $905.95 per original $1,000 invested.
     

          AEI REAL ESTATE FUND 85-A LIMITED PARTNERSHIP

                  NOTES TO FINANCIAL STATEMENTS

                   DECEMBER 31, 1997 AND 1996

(7)  Income Taxes -

     The   following  is  a  reconciliation  of  net  income  for
     financial reporting purposes to income reported for  federal
     income tax purposes for the years ended December 31:
     
                                             1997          1996
     
     Net Income For Financial
      Reporting Purposes                  $ 332,237     $ 317,664
     
     Depreciation for Tax Purposes Over
      Depreciation For Financial
      Reporting Purposes                    (25,844)      (30,831)
                                           ----------    ----------
           Taxable Income to Partners     $ 306,393     $ 286,833
                                           ==========    ==========
     
     The  following is a reconciliation of Partners' capital  for
     financial  reporting purposes to Partners' capital  reported
     for   federal  income  tax  purposes  for  the  years  ended
     December31:
     
                                                   1997            1996
     
     Partners' Capital For
      Financial Reporting Purposes             $ 4,195,490     $ 4,265,776
     
     Adjusted Tax Basis of Investments
      In Real Estate Under Net Investments
      In Real Estate for Financial
      Reporting Purposes                          (181,386)       (155,542)
     
     Capitalized Start-Up Costs
      Under Section 195                            363,592         363,592
     
     Amortization of Start-Up and
      Organization Costs                          (389,641)       (389,641)
     
     Organization and Syndication Costs
      Treated as Reduction of Capital
      For Financial Reporting Purposes           1,004,426       1,004,426
                                                -----------     -----------
           Partners' Capital For
              Tax Reporting Purposes           $ 4,992,481     $ 5,088,611
                                                ===========     ===========


          AEI REAL ESTATE FUND 85-A LIMITED PARTNERSHIP

                  NOTES TO FINANCIAL STATEMENTS

                   DECEMBER 31, 1997 AND 1996

(8)  Fair Value of Financial Instruments -

     The estimated fair values of the financial instruments, none
     of  which  are held for trading purposes, are as follows  at
     December 31:
     
                                      1997                      1996
                             Carrying       Fair       Carrying       Fair
                              Amount       Value        Amount        Value
     
     Cash                  $     171    $     171     $     396    $     396
     Money Market Funds      174,512      174,512       136,745      136,745
                            ---------    ---------     ---------    ---------
      Total Cash and
       Cash Equivalents    $ 174,683    $ 174,683     $ 137,141    $ 137,141
                            =========    =========     =========    =========
     

ITEM 8.CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
       ACCOUNTING AND FINANCIAL DISCLOSURE.

       None.

                                
                            PART III
                                
ITEM 9.DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
       PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE
       ACT.

        The  registrant  is  a  limited partnership  and  has  no
officers,  directors, or direct employees.  The General  Partners
of  the  registrant are Robert P. Johnson and NLM.   The  General
Partners  manage and control the Partnership's affairs  and  have
general  responsibility and the ultimate authority in all matters
affecting the Partnership's business.  The director and  officers
of NLM are as follows:

        Robert  P.  Johnson, age 53, is Chief Executive  Officer,
President  and  Director and has held these positions  since  the
formation  of  NLM  in November, 1984, and has  been  elected  to
continue in these positions until March, 1999.  From 1970 to  the
present,  he  has  been employed exclusively  in  the  investment
industry,  specializing  in  tax-advantaged  limited  partnership
investments.   In  that  capacity, he has been  involved  in  the
development,  analysis, marketing and management  of  public  and
private investment programs investing in net lease properties  as
well  as  public  and  private investment programs  investing  in
energy  development.   Since  1971,  Mr.  Johnson  has  been  the
president,  a  director  and  a  registered  principal   of   AEI
Securities, Inc. (formerly AEI Incorporated), which is registered
with  the  Securities  and Exchange Commission  as  a  securities
broker-dealer,  is  a  member  of  the  National  Association  of
Securities  Dealers, Inc. (NASD) and is a member of the  Security
Investors  Protection Corporation (SIPC).  Mr. Johnson  has  been
president, a director and the principal shareholder of  AEI  Fund
Management,  Inc.,  a real estate management company  founded  by
him,  since 1978.  Mr. Johnson is currently a general partner  or
principal  of  the  general  partner  in  sixteen  other  limited
partnerships.

        Mark  E.  Larson,  age 45, is Executive  Vice  President,
Treasurer  and  Chief Financial Officer and has been  elected  to
continue  in these positions until March, 1999.  Mr.  Larson  has
been  Treasurer and Executive Vice President since December, 1987
and  Chief  Financial Officer since January, 1990.   In  January,
1993,  Mr.  Larson was elected to serve as Secretary of  NLM  and
will  continue to serve until March, 1999.  Mr. Larson  has  been
employed  by  AEI  Fund Management, Inc. and affiliated  entities
since  1985.   From  1979  to 1985, Mr. Larson  was  with  Apache
Corporation as manager of Program Accounting responsible for  the
accounting  and reports for approximately 45 public partnerships.
Mr.   Larson   is  responsible  for  supervising  the  accounting
functions of NLM and the registrant.

ITEM 10.    EXECUTIVE COMPENSATION.

        The General Partner and affiliates are reimbursed at cost
for  all  services performed on behalf of the registrant and  for
all  third party expenses paid on behalf of the registrant.   The
cost for services performed on behalf of the registrant is actual
time  spent  performing such services plus  an  overhead  burden.
These  services include organizing the registrant  and  arranging
for  the  offer  and  sale  of Units,  reviewing  properties  for
acquisition and rendering administrative and management services.


ITEM 11.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
            MANAGEMENT.

        The following table sets forth information pertaining  to
the   ownership  of  the  Units  by  each  person  known  by  the
Partnership to beneficially own 5% or more of the Units, by  each
General  Partner, and by each officer or director of the Managing
General Partner as of February 28, 1998:

     Name and Address                            Number of          Percent
   of Beneficial Owner                           Units Held        of Class

   Net Lease Management 85-A, Inc.                  14.5               *
   1300 Minnesota World Trade Center
   30 East 7th Street, St. Paul, Minnesota 55101

   Robert P. Johnson                                   0               0%
   1300 Minnesota World Trade Center
   30 East 7th Street, St. Paul, Minnesota 55101

   Mark E. Larson                                      0               0%
   1300 Minnesota World Trade Center
   30 East 7th Street, St. Paul, Minnesota 55101

   * Less than 1%
   
The  persons  set forth in the preceding table hold  sole  voting
power  and power of disposition with respect to all of the  Units
set forth opposite their names.  The General Partners know of  no
holders of more than 5% of the outstanding Units.

ITEM 12.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

        The  registrant,  NLM  and  its  affiliates  have  common
management and utilize the same facilities.  As a result, certain
administrative  expenses  are  allocated  among   these   related
entities.   All  of  such activities and any  other  transactions
involving the affiliates of the General Partner of the registrant
are  governed  by,  and  are conducted in  conformity  with,  the
limitations set forth in the Limited Partnership Agreement of the
registrant.  Reference is made to Note 3 on Page 18 and  19,  and
is incorporated herein by reference, for details of Related Party
Transactions.


                             PART IV

ITEM 13.    EXHIBITS AND REPORTS ON FORM 8-K AND 8-K/A.

            A.   Exhibits -
                                  Description

                 27   Financial Data Schedule
                      for year ended December 31, 1997.

            B.   Reports on Form 8-K and 8-K/A - None.


                           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.


                          AEI REAL ESTATE FUND 85-A
                          Limited Partnership
                          By:  Net  Lease Management  85-A, Inc.
                             Its Managing General Partner


March 9, 1998             By: /s/ Robert P. Johnson
                                  Robert  P. Johnson, President and Director
                                  (Principal Executive Officer)


        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 and  on
the dates indicated.

        Name                            Title                         Date


/s/ Robert P. Johnson   President (Principal Executive Officer)   March 9, 1998
Robert P. Johnson       and Sole Director of Managing General
                        Partner

/s/ Mark E. Larson      Executive Vice President,  Treasurer      March 9, 1998
Mark E. Larson          and Chief Financial Officer
                        (Principal Accounting Officer)