UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549FORM 10-Q

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

For the Quarterly Period Ended March 31, 2002or

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

For the transition period from ____________ to ____________
Commission File #0-19220Inland Land Appreciation Fund II, L.P.(Exact name of registrant as specified in its charter)



|Delaware                          | #36-3664407                            
|--------------------------------- | ---------------------------------------
|(State or other jurisdiction      | (I.R.S. Employer Identification Number)
|of incorporation or organization) |                                        



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

Registrant's telephone number, including area code:  630-218-8000
________________N/A___________________
(Former name, former address and former fiscal
year, if changed since last report)

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

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INLAND LAND APPRECIATION FUND II, L.P.
(a limited partnership)
Balance Sheets
March 31, 2002 and December 31, 2001
(unaudited)Assets

|                                                                                                                                                                                 |   | 2002       | 2001      
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | - | ---------- | ----------
|Current assets:                                                                                                                                                                  |   |            |           
|Cash and cash equivalents                                                                                                                                                        | $ | 2,227,143  | 2,185,530 
|Accounts and accrued interest receivable, (net of allowance for     doubtful accounts of $336,712 at March 31, 2002) (Note 5)                                                    |   | 886,471    | 971,627   
|Other current assets                                                                                                                                                             |   | 15,486     | 12,005    
|                                                                                                                                                                                 |   |            |           
|Total current assets                                                                                                                                                             |   | 3,129,100  | 3,169,162 
|                                                                                                                                                                                 |   |            |           
|Mortgage loans receivable (net of allowance for doubtful   accounts of $1,000,000 at March 31, 2002) (Note 5)                                                                    |   | 16,409,878 | 17,409,878
|Investment properties (including acquisition fees paid to   Affiliates of $1,145,337 and $1,154,729 at March 31, 2002   and December 31, 2001, respectively) (Notes 1, 3 and 6): |   |            |           
|Land and improvements                                                                                                                                                            |   | 25,104,239 | 25,439,556
|                                                                                                                                                                                 |   |            |           
|Total assets                                                                                                                                                                     | $ | 44,643,217 | 46,018,596
|                                                                                                                                                                                 |   | ========== | ========= 



See accompanying notes to financial statements.

-2-

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INLAND LAND APPRECIATION FUND II, L.P.
(a limited partnership)
Balance Sheets
(continued)
March 31, 2002 and December 31, 2001
(unaudited)

Liabilities and Partners' Capital

|                                                                                                                                                                                                                                         |   | 2002         | 2001        
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | - | ------------ | ------------
|                                                                                                                                                                                                                                         |   |              |             
|Current liabilities:                                                                                                                                                                                                                     |   |              |             
|Accounts payable                                                                                                                                                                                                                         | $ | 148,396      | 365,653     
|Accrued real estate taxes                                                                                                                                                                                                                |   | 85,677       | 69,146      
|Due to Affiliates (Note 2)                                                                                                                                                                                                               |   | 21,709       | 8,075       
|Unearned income                                                                                                                                                                                                                          |   | 127,987      | 96,688      
|                                                                                                                                                                                                                                         |   |              |             
|Total current liabilities                                                                                                                                                                                                                |   | 383,769      | 539,562     
|                                                                                                                                                                                                                                         |   |              |             
|Deferred gain on sale of investment properties (Note 5)                                                                                                                                                                                  |   | 9,327,710    | 10,075,165  
|                                                                                                                                                                                                                                         |   |              |             
|Partners' capital:                                                                                                                                                                                                                       |   |              |             
|General Partner:                                                                                                                                                                                                                         |   |              |             
|Capital contribution                                                                                                                                                                                                                     |   | 500          | 500         
|Cumulative net income                                                                                                                                                                                                                    |   | 2,151,963    | 2,157,496   
|Cumulative cash distributions                                                                                                                                                                                                            |   | (1,789,294)  | (1,789,294) 
|                                                                                                                                                                                                                                         |   |              |             
|                                                                                                                                                                                                                                         |   | 363,169      | 368,702     
|Limited Partners:                                                                                                                                                                                                                        |   |              |             
|Units of $1,000. Authorized 60,000 Units,  50,067 and 50,070 Units       outstanding at March 31, 2002 and December 31, 2001, respectively       (net of offering costs of $7,532,439, of which $2,535,445 was paid       to Affiliates) |   | 42,559,909   | 42,561,109  
|Cumulative net income                                                                                                                                                                                                                    |   | 22,801,766   | 23,267,164  
|Cumulative cash distributions                                                                                                                                                                                                            |   | (30,793,106) | (30,793,106)
|                                                                                                                                                                                                                                         |   |              |             
|                                                                                                                                                                                                                                         |   | 34,568,569   | 35,035,167  
|                                                                                                                                                                                                                                         |   |              |             
|Total Partners' capital                                                                                                                                                                                                                  |   | 34,931,738   | 35,403,869  
|                                                                                                                                                                                                                                         |   |              |             
|Total liabilities and Partners' capital                                                                                                                                                                                                  | $ | 44,643,217   | 46,018,596  
|                                                                                                                                                                                                                                         |   | =========    | =========   



See accompanying notes to financial statements.
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INLAND LAND APPRECIATION FUND II, L.P.
(a limited partnership)
Statements of Operations
For the three months ended March 31, 2002 and 2001
(unaudited)

|                                                                                                                                                                                                   |   | 2002      | 2001      
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | - | --------- | ----------
|Income:                                                                                                                                                                                            |   |           |           
|Sale of investment properties (Note 3)                                                                                                                                                             | $ | 725,658   | 11,524,058
|Rental income (Note 4)                                                                                                                                                                             |   | 49,779    | 68,890    
|Interest income                                                                                                                                                                                    |   | 249,288   | 71,256    
|Other income                                                                                                                                                                                       |   | 865       | 30,150    
|                                                                                                                                                                                                   |   |           |           
|                                                                                                                                                                                                   |   | 1,025,590 | 11,694,354
|                                                                                                                                                                                                   |   |           |           
|Expenses:                                                                                                                                                                                          |   |           |           
|Cost of investment properties sold                                                                                                                                                                 |   | 643,299   | 2,685,775 
|Professional services to Affiliates                                                                                                                                                                |   | 12,112    | 23,325    
|Professional services to non-affiliates                                                                                                                                                            |   | 34,093    | 26,972    
|General and administrative expenses to Affiliates                                                                                                                                                  |   | 6,056     | 4,921     
|General and administrative expenses to non-affiliates                                                                                                                                              |   | 88,729    | 10,727    
|Marketing expenses to Affiliates                                                                                                                                                                   |   | 5,980     | 5,656     
|Marketing expenses to non-affiliates                                                                                                                                                               |   | 58,098    | 12,613    
|Land operating expenses to non-affiliates                                                                                                                                                          |   | 58,896    | 38,305    
|Depreciation                                                                                                                                                                                       |   | -         | 775       
|Bad debt expense                                                                                                                                                                                   |   | 589,258   | -         
|                                                                                                                                                                                                   |   |           |           
|                                                                                                                                                                                                   |   | 1,496,521 | 2,809,069 
|                                                                                                                                                                                                   |   |           |           
|Net income (loss)                                                                                                                                                                                  | $ | (470,931) | 8,885,285 
|                                                                                                                                                                                                   |   | ========= | ========  
|Net income (loss) allocated to:                                                                                                                                                                    |   |           |           
|General Partner                                                                                                                                                                                    | $ | (5,533)   | 544,530   
|Limited Partners                                                                                                                                                                                   |   | (465,398) | 8,340,755 
|                                                                                                                                                                                                   |   |           |           
|Net income (loss)                                                                                                                                                                                  | $ | (470,931) | 8,885,285 
|                                                                                                                                                                                                   |   | ========= | ========  
|                                                                                                                                                                                                   |   |           |           
|Net income (loss) allocated to the one General Partner Unit                                                                                                                                        | $ | (5,533)   | 544,530   
|                                                                                                                                                                                                   |   | ========= | ========  
|                                                                                                                                                                                                   |   |           |           
|Net income (loss) per Unit allocated to Limited Partners per   weighted average Limited Partnership Units (50,069 and 50,073   for the three months ended March 31, 2002 and 2001,   respectively) | $ | (9.30)    | 166.57    
|                                                                                                                                                                                                   |   | ========= | ========  



See accompanying notes to financial statements.
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INLAND LAND APPRECIATION FUND II, L.P.
(a limited partnership)
Statements of Cash Flows
For the three months ended March 31, 2002 and 2001
(unaudited)

|                                                                                                   |   | 2002      | 2001       
|-------------------------------------------------------------------------------------------------- | - | --------- | -----------
|Cash flows from operating activities:                                                              |   |           |            
|Net income (loss)                                                                                  | $ | (470,931) | 8,885,285  
|Adjustments to reconcile net income (loss) to net cash provided by
(used in) operating activities: |   |           |            
|Depreciation                                                                                       |   | -         | 775        
|Gain on sale of investment properties                                                              |   | (82,359)  | (8,838,283)
|Bad debt expense                                                                                   |   | 589,257   | -          
|Changes in assets and liabilities:                                                                 |   |           |            
|Accounts and accrued interest receivable                                                           |   | (251,556) | (49,324)   
|Other current assets                                                                               |   | (3,481)   | (13,571)   
|Accounts payable                                                                                   |   | (217,257) | 8,550      
|Accrued real estate taxes                                                                          |   | 16,531    | 21,535     
|Due to Affiliates                                                                                  |   | 13,634    | (20,048)   
|Unearned income                                                                                    |   | 31,299    | 70,096     
|                                                                                                   |   |           |            
|Net cash provided by (used in) operating activities                                                |   | (374,863) | 65,015     
|                                                                                                   |   |           |            
|Cash flows from investing activities:                                                              |   |           |            
|Additions to investment properties                                                                 |   | (307,982) | (956,973)  
|Proceeds from sale of investment properties                                                        |   | 725,658   | 11,524,058 
|                                                                                                   |   |           |            
|Net cash provided by investing activities                                                          |   | 417,676   | 10,567,085 
|                                                                                                   |   |           |            
|Cash flows from financing activities:                                                              |   |           |            
|Repurchase of Limited Partnership Units                                                            |   | (1,200)   | -          
|                                                                                                   |   |           |            
|Net cash used in financing activities                                                              |   | (1,200)   | -          
|                                                                                                   |   |           |            
|Net increase in cash and cash equivalents                                                          |   | 41,613    | 10,632,100 
|Cash and cash equivalents at beginning of period                                                   |   | 2,185,530 | 1,762,071  
|                                                                                                   |   |           |            
|Cash and cash equivalents at end of period                                                         | $ | 2,227,143 | 12,394,171 
|                                                                                                   |   | ========= | =========  



See accompanying notes to financial statements.
-5-

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INLAND LAND APPRECIATION FUND II, L.P.
(a limited partnership)
Notes to Financial Statements
March 31, 2002
(unaudited)

Readers of this Quarterly Report should refer to the Partnership's audited financial statements for the fiscal year ended December 31, 2001, which are included in the Partnership's 2001 Annual Report, as certain footnote disclosures which would substantially duplicate those contained in such audited financial statements have been omitted from this Report.



(1)  Organization and Basis of Accounting



The Registrant, Inland Land Appreciation Fund II, L.P. (the "Partnership"), is a limited partnership formed on June 28, 1989, pursuant to the Delaware Revised Uniform Limited Partnership Act, to invest in undeveloped land on an all-cash basis and realize appreciation of such land upon resale. On October 25, 1989, the Partnership commenced an Offering of 30,000 (subject to increase to 60,000) Limited Partnership Units pursuant to a Registration under the Securities Act of 1933.  The Amended and Restated Agreement of Limited Partnership (the "Partnership Agreement") provides for Inland Real Estate Investment Corporation to be the General Partner. On October 24, 1991, the Partnership terminated its Offering of Units, with total sales of 50,476.17 Units, at $1,000 per Unit, resulting in $50,476,170 in gross offering proceeds, not including the General Partner's capital contribution of $500.  All of the holders of these Units have been admitted to the Partnership.  As of March 31, 2002, the Partnership has repurchased a total of 408.65 Units for $383,822 from various Limited Partners through the Unit Repurchase Program.  Under this program, Limited Partners may, under certain circumstances, have their Units repurchased for an amount equal to their Invested Capital.



The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.  Actual results could differ from those estimates.



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

-6-

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INLAND LAND APPRECIATION FUND II, L.P.
(a limited partnership)

Notes to Financial Statements
(continued)

March 31, 2002
(unaudited)

(2)  Transactions with Affiliates



The General Partner and its Affiliates are entitled to reimbursement for salaries and expenses of employees of the General Partner and its Affiliates relating to the administration of the Partnership.  Such costs are included in professional services and general and administrative expenses to Affiliates, of which $5,324 and $8,075 was unpaid as of March 31, 2002 and December 31, 2001, respectively.



The General Partner is entitled to receive Asset Management Fees equal to one-quarter of 1% of the original cost to the Partnership of undeveloped land annually, limited to a cumulative total over the life of the Partnership of 2% of the land's original cost to the Partnership.  As of September 30, 2000, the Partnership had met this limit.



An Affiliate of the General Partner performed sales marketing and advertising services for the Partnership and was reimbursed (as set forth under terms of the Partnership Agreement) for direct costs.  Such costs of $5,980 and $5,656 have been incurred for the three months ended March 31, 2002 and 2001, respectively, and are included in marketing expenses to Affiliates.  As of March 31, 2002 and December 31, 2001, all of such costs were paid.



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

-7-

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INLAND LAND APPRECIATION FUND II, L.P.
(a limited partnership)
Notes to Financial Statements
(continued)

(3) Investment Properties

|       | Gross Acres | Purchase/  | Initial Costs | Costs Capitalized | Costs of  | Total Remaining Costs of | Current Year Gain (Loss)
|------ | ----------- | ---------- | ------------- | ----------------- | --------- | ------------------------ | ------------------------
|Parcel | Illinois    | Purchased  | Sales         |                   | Original  | Acquisition              | Total                   
|#      | County      | (Sold)     | Date          |                   | Costs     | Costs                    | Costs                   
|1      | McHenry     | 372.759    | 04/25/90      | $                 | 2,114,295 | 114,070                  | 2,228,365               
|       |             |            |               |                   |           |                          |                         
|2      | Kendall     | 41.118     | 07/06/90      |                   | 549,639   | 43,889                   | 593,528                 
|       |             |            |               |                   |           |                          |                         
|3      | Kendall     | 120.817    | 11/06/90      |                   | 1,606,794 | 101,863                  | 1,708,657               
|       |             |            |               |                   |           |                          |                         
|4      | Kendall     | 299.025    | 06/28/91      |                   | 1,442,059 | 77,804                   | 1,519,863               
|       |             |            |               |                   |           |                          |                         
|5      | Kane        | 189.0468   | 02/28/91      |                   | 1,954,629 | 94,569                   | 2,049,198               
|       |             | (189.0468) | 05/16/01      |                   |           |                          |                         
|       |             |            |               |                   |           |                          |                         
|6      | Lake        | 57.3345    | 04/16/91      |                   | 904,337   | 71,199                   | 975,536                 
|       |             | (.258)     | 10/01/94      |                   |           |                          |                         
|       |             |            |               |                   |           |                          |                         
|7      | McHenry     | 56.7094    | 04/22/91      |                   | 680,513   | 44,444                   | 724,957                 
|       |             | (12.6506)  | Var 1997      |                   |           |                          |                         
|       |             | (15.7041)  | Var 1998      |                   |           |                          |                         
|       |             | (19.6296)  | Var 1999      |                   |           |                          |                         
|       |             | (8.7251)   | Var 2000      |                   |           |                          |                         
|       |             |            |               |                   |           |                          |                         
|8      | Kane        | 325.394    | 06/14/91      |                   | 3,496,700 | 262,275                  | 3,758,975               
|       |             | (.870)     | 04/03/96      |                   |           |                          |                         
|       |             | (63.000)   | 01/23/01      |                   |           |                          |                         
|       |             |            |               |                   |           |                          |                         
|9      | Will        | 9.867      | 08/13/91      |                   | 217,074   | 988                      | 218,062                 
|       |             |            |               |                   |           |                          |                         
|10     | Will        | 150.66     | 08/20/91      |                   | 1,866,716 | 89,333                   | 1,956,049               
|       |             |            |               |                   |           |                          |                         
|11     | Will        | 138.447    | 08/20/91      |                   | 289,914   | 20,376                   | 310,290                 
|       |             | (138.447)  | 05/03/93      |                   |           |                          |                         
|       |             |            |               |                   |           |                          |                         
|12     | Will        | 44.732     | 08/20/91      |                   | 444,386   | 21,988                   | 466,374                 
|       |             |            |               |                   |           |                          |                         
|13     | Will        | 6.342      | 09/23/91      |                   | 139,524   | 172                      | 139,696                 
|       |             | (6.342)    | 05/03/93      |                   |           |                          |                         



-8-

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INLAND LAND APPRECIATION FUND II, L.P.

(a limited partnership)



Notes to Financial Statements

(continued)

(3) Investment Properties (continued)

|       | Gross Acres | Purchase/ | Initial Costs | Costs Capitalized | Costs of  | Total Remaining Costs of | Current Year Gain (Loss)
|------ | ----------- | --------- | ------------- | ----------------- | --------- | ------------------------ | ------------------------
|Parcel | Illinois    | Purchased | Sales         |                   | Original  | Acquisition              | Total                   
|#      | County      | (Sold)    | Date          |                   | Costs     | Costs                    | Costs                   
|       |             |           |               |                   |           |                          |                         
|14     | Kendall     | 44.403    | 09/03/91      |                   | 888,060   | 68,210                   | 956,270                 
|       |             | (15.392)  | 04/16/01      |                   |           |                          |                         
|       |             |           |               |                   |           |                          |                         
|15     | Kendall     | 100.364   | 09/04/91      |                   | 1,050,000 | 52,694                   | 1,102,694               
|       |             | (5.000)   | 09/01/93      |                   |           |                          |                         
|       |             | (11.000)  | 12/01/94      |                   |           |                          |                         
|       |             | (84.364)  | 08/14/98      |                   |           |                          |                         
|       |             |           |               |                   |           |                          |                         
|16     | McHenry     | 168.905   | 09/13/91      |                   | 1,402,058 | 69,731                   | 1,471,789               
|       |             | (168.905) | 08/03/01      |                   |           |                          |                         
|       |             |           |               |                   |           |                          |                         
|17     | Kendall     | 3.462     | 10/30/91      |                   | 435,000   | 22,326                   | 457,326                 
|       |             | (2.113)   | 03/06/01      |                   |           |                          |                         
|       |             |           |               |                   |           |                          |                         
|18     | McHenry     | 139.1697  | 11/07/91      |                   | 1,160,301 | 58,190                   | 1,218,491               
|       |             |           |               |                   |           |                          |                         
|19     | Kane        | 436.236   | 12/13/91      |                   | 4,362,360 | 321,250                  | 4,683,610               
|       |             | (436.236) | 05/16/01      |                   |           |                          |                         
|       |             |           |               |                   |           |                          |                         
|20     | Kane &      |           |               |                   |           |                          |                         
|       | Kendall     | 400.129   | 01/31/92      |                   | 1,692,623 | 101,318                  | 1,793,941               
|       |             | (21.138)  | 06/30/99      |                   |           |                          |                         
|       |             |           |               |                   |           |                          |                         
|21     | Kendall     | 15.013    | 05/26/92      |                   | 250,000   | 23,844                   | 273,844                 
|       |             | (1.000)   | 03/16/99      |                   |           |                          |                         
|       |             |           |               |                   |           |                          |                         
|22     | Kendall     | 391.959   | 10/30/92      |                   | 3,870,000 | 283,186                  | 4,153,186               
|       |             | (10.000)  | 01/06/94      |                   |           |                          |                         
|       |             | (5.538)   | 01/05/96      |                   |           |                          |                         
|       |             | (2.400)   | 07/27/99      |                   |           |                          |                         
|       |             | (73.395)  | Var 2001      |                   |           |                          |                         

-9-

---

INLAND LAND APPRECIATION FUND II, L.P.

(a limited partnership)



Notes to Financial Statements

(continued)

(3) Investment Properties (continued)

|       | Gross Acres | Purchase/ | Initial Costs | Costs Capitalized | Costs of   | Total Remaining Costs of | Current Year Gain (Loss)
|------ | ----------- | --------- | ------------- | ----------------- | ---------- | ------------------------ | ------------------------
|Parcel | Illinois    | Purchased | Sales         |                   | Original   | Acquisition              | Total                   
|#      | County      | (Sold)    | Date          |                   | Costs      | Costs                    | Costs                   
|       |             |           |               |                   |            |                          |                         
|23 (c) | Kendall     | 133.2074  | 10/30/92      |                   | 3,231,942  | 251,373                  | 3,483,315               
|       |             | (11.525)  | 07/16/93      |                   |            |                          |                         
|       |             | (44.070)  | Var 1995      |                   |            |                          |                         
|       |             | (8.250)   | Var 1996      |                   |            |                          |                         
|       |             | (2.610)   | Var 1997      |                   |            |                          |                         
|       |             | (10.6624) | Var 1998      |                   |            |                          |                         
|       |             | (5.8752)  | Var 1999      |                   |            |                          |                         
|       |             | (49.0120) | Var 2000      |                   |            |                          |                         
|       |             | (.2028)   | Var 2001      |                   |            |                          |                         
|       |             | (1.0000)  | 02/22/02      |                   |            |                          |                         
|       |             |           |               |                   |            |                          |                         
|23A(a) | Kendall     | .2676     | 10/30/92      |                   | 170,072    | 12,641                   | 182,713                 
|       |             | (.2676)   | 03/16/93      |                   |            |                          |                         
|       |             |           |               |                   |            |                          |                         
|24     | Kendall     | 3.908     | 01/21/93      |                   | 645,000    | 56,316                   | 701,316                 
|       |             | (3.908)   | 04/16/01      |                   |            |                          |                         
|       |             |           |               |                   |            |                          |                         
|24A(b) | Kendall     | .406      | 01/21/93      |                   | 155,000    | 13,533                   | 168,533                 
|       |             | (.406)    | 04/16/01      |                   |            |                          |                         
|       |             |           |               |                   |            |                          |                         
|25     | Kendall     | 656.687   | 01/28/93      |                   | 1,625,000  | 82,536                   | 1,707,536               
|       |             | (656.687) | 10/31/95      |                   |            |                          |                         
|       |             |           |               |                   |            |                          |                         
|26     | Kane        | 89.511    | 03/10/93      |                   | 1,181,555  | 89,312                   | 1,270,867               
|       |             | (2.108)   | Var 1999      |                   |            |                          |                         
|       |             | (34.255)  | Var 2000      |                   |            |                          |                         
|       |             | (7.800)   | Var 2001      |                   |            |                          |                         
|       |             | (8.320)   | Var 2002      |                   |            |                          |                         
|       |             |           |               |                   |            |                          |                         
|27     | Kendall     | 83.525    | 03/11/93      |                   | 984,474    | 54,846                   | 1,039,320               
|       |             |           |               |                   |            |                          |                         
|       |             |           |               | $                 | 38,810,025 | 2,504,276                | 41,314,301              
|       |             |           |               |                   | =========  | =========                | ========                

-10-

---

INLAND LAND APPRECIATION FUND II, L.P.
(a limited partnership)



Notes to Financial Statements
(continued)



March 31, 2002
(unaudited)



(3)  Investment Properties (continued)

1. Included in the purchase of Parcel 23 was a newly constructed 2,500 square foot house.  The house was sold in March 1993.
2. Included in the purchase of Parcel 24 is a 2,400 square foot office building.
3. Parcel 23, annexed and zoned to Oswego, Illinois as part of the Mill Race Creek subdivision, consists of two parts: a 28-acre multi-family portion and a 105-acre single-family portion.  The Partnership sold the 28-acre multi-family portion on June 7, 1995 and as of March 31, 2002, the partnership has sold all of the 243 single-family lots to homebuilders.
4. Reconciliation of investment properties and improvements owned:



|                         |   | March 31,  | December 31,
|------------------------ | - | ---------- | ------------
|                         |   | 2002       | 2001        
|                         |   |            |             
|Balance at January 1,    | $ | 25,439,556 | 35,501,867  
|Additions during period  |   | 307,982    | 4,088,168   
|Sales during period      |   | (643,299)  | (14,150,479)
|                         |   |            |             
|Balance at end of period | $ | 25,104,239 | 25,439,556  
|                         |   | ========== | =========== 



|                         |   | 2002       | 2001      
|------------------------ | - | ---------- | ----------
|                         |   |            |           
|Balance at January 1,    | $ | -          | 24,693    
|Depreciation expense     |   | -          | (25,469)  
|Sales during period      |   | -          | 776       
|                         |   |            |           
|Balance at end of period | $ | -          | -         
|                         |   | ========== | ==========

(4)  Farm Rental Income

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



As of March 31, 2002, the Partnership had farm leases of generally one year in duration, for approximately 1,726 acres of the approximately 2,342 acres owned.

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INLAND LAND APPRECIATION FUND II, L.P.
(a limited partnership)



Notes to Financial Statements
(continued)



March 31, 2002
(unaudited)



(5)  Mortgage Loans Receivable

Mortgage loans receivable are the result of sales of Parcels, in whole or in part.  The Partnership has recorded a deferred gain on these sales.  The deferred gain will be recognized over the life of the related mortgage loan receivable as principal payments are received.  At March 31, 2002, the fair market value of the mortgage loans receivable approximated their carrying value.

|                                     |           |               |              |            | Accrued    |           
|------------------------------------ | --------- | ------------- | ------------ | ---------- | ---------- | ----------
|                                     |           |               | Principal    | Principal  | Interest   | Deferred  
|                                     |           |               | Balance      | Balance    | Receivable | Gain      
|Parcel                               | Maturity  | Interest Rate | 03/31/02     | 12/31/01   | 03/31/02   | 03/31/02  
|                                     |           |               |              |            |            |           
|15                                   | 07/31/01  | 9.00%         | $  1,208,378 | 1,208,378  | 336,712    | 747,454   
|                                     |           |               |              |            |            |           
|26                                   | 10/04/04  | 8.00%         | 228,000      | 228,000    | 45,525     | -         
|                                     |           |               |              |            |            |           
|5 & 19                               | 07/01/11  | 6.00%         | 15,973,500   | 15,973,500 | 824,495    | 9,327,710 
|                                     |           |               |              |            |            |           
|                                     |           |               | 17,409,878   | 17,409,878 | 1,206,732  | 10,075,164
|                                     |           |               |              |            |            |           
|Less allowance for doubtful accounts | 1,000,000 | -             | 336,712      | 747,454   
|                                     |           |               |              |            |            |           
|                                     |           |               | $16,409,878  | 17,409,878 | 870,020    | 9,327,710 
|                                     |           |               | =========    | =========  | =========  | ========= 



1. Subsequent Events

During April 2002, the Partnership sold 9 additional lots at Parcel 26 for approximately $408,000 and recorded a gain of approximately $68,000.



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

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



Liquidity and Capital Resources



On October 25, 1989, the Partnership commenced an Offering of 30,000 (subject to increase to 60,000) Limited Partnership Units pursuant to a Registration Statement on Form S-11 under the Securities Act of 1933.  On October 24, 1991, the Partnership terminated its Offering of Units, with total sales of 50,476.17 Units, at $1,000 per Unit, resulting in $50,476,170 in gross offering proceeds, not including the General Partner's capital contribution of $500.  All of the holders of these Units have been admitted to the Partnership.  The Limited Partners of the Partnership will share in their portion of benefits of ownership of the Partnership's real property investments according to the number of Units held.



The Partnership used $41,314,301 of gross offering proceeds to purchase, on an all-cash basis, twenty-seven parcels of undeveloped land and two buildings.  These investments include the payment of the purchase price, acquisition fees and acquisition costs of such properties.  Three of the parcels were purchased during 1990, sixteen during 1991, four during 1992 and four during 1993.  As of March 31, 2002, the Partnership has had multiple sales transactions through which it has disposed of approximately 2,138 acres of the approximately 4,480 acres originally owned.  As of March 31, 2002, cumulative distributions have totaled $30,793,106 to the Limited Partners and $1,789,294 to the General Partner.  Of the $30,793,106 distributed to the Limited Partners, $30,072,106 was from net sales proceeds (which represents a return of Invested Capital, as defined in the Partnership Agreement) and  $721,000 was from operations.  As of March 31, 2002, the Partnership has used $17,620,697 of working capital reserve for rezoning and other activities.  Such amounts have been capitalized and are included in investment properties.



The Partnership's capital needs and resources will vary depending upon a number of factors, including the extent to which the Partnership conducts rezoning and other activities relating to utility access, the installation of roads, subdivision and/or annexation of land to a municipality, changes in real estate taxes affecting the Partnership's land, and the amount of revenue received from leasing.  As of March 31, 2002, the Partnership owns, in whole or in part, seventeen of its twenty-seven original parcels, the majority of which are leased to local tenants and are generating sufficient cash flow from leases to cover property taxes and insurance.



At March 31, 2002, the Partnership had cash and cash equivalents of $2,227,143 of which approximately $264,000 is reserved for the repurchase of Units through the Unit Repurchase Program.  The remaining amount is available to be used for the Partnership expenses and liabilities, cash distributions to partners and other activities with respect to some or all of its land parcels.  The Partnership has increased its parcel sales effort in anticipation of rising land values.

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The Partnership plans to enhance the value of its land through pre-development activities such as rezoning, annexation and land planning. The Partnership has already been successful in, or is in the process of, pre-development activity on a majority of the Partnership's land investments. Parcel 1, annexed to the Village of Huntley and zoned for residential and commercial development has improvements in planning stage and sites are being marketed to potential buyers. Parcel 3 is zoned for various manufacturing and commercial uses and preliminary planning is in progress. Parcels 14, 17 and 24 were rezoned for commercial and multi-family uses in 1999 and a sale of approximately 19 acres was completed in 2001.  Marketing of the balance of these parcels continues. As of March 31, 2002, the Partnership has sold all of the 243 single-family lots at the Ponds of Mill Race Creek  (Parcel 23) in addition to the multi-family portion, the Winding Waters of Mill Race Creek. Parcel 26 is under development for single-family homes with all 170 lots under contract for sale. As of March 31, 2002, 97 of the 170 lots have already closed. Discussions are ongoing for rezoning and variations to portions of Parcel 20.



Results of Operations



Income from the sale of investment properties and the cost of investment properties sold for the three months ended March 31, 2002, is the result of the sale of the remaining lot at the Ponds of Mill Race Creek subdivision (Parcel 23), and the sale of additional lots of the Bliss Woods subdivision (Parcel 26). Income from the sale of investment properties and cost of investment properties sold for the three months ended March 31, 2001 is the result of the sale of approximately 134 acres, consisting of the sale of additional lots at the Ponds of Mill Race Creek subdivision (Parcel 23), the sale of approximately 63 acres of Parcel 8, the sale of  approximately 67 acres of Parcel 22 and the sale of two acres of Parcel 17.



As of March 31, 2002, the Partnership owned seventeen parcels of land consisting of approximately 2,342 acres. Of the approximately 2,342 acres owned, 1,726 acres are tillable, leased to local farmers and generate sufficient cash flow to cover property taxes, insurance and other miscellaneous expenses.  Rental income decreased for the three months ended March 31, 2002, as compared to the three months ended March 31, 2001, due to the sales activity which results in a decrease in the parcels being farmed.



Interest income increased for the three months ended March 31, 2002, as compared to the three months ended March 31, 2001, due primarily to the interest income earned on mortgages receivable as a result of the sale of Parcels 5 and 19 in May 2001.



The other income recorded for the three months ended March 31, 2001, is the result of the Partnership receiving non-refundable deposits on land sales which did not occur.



General and administrative expenses to non-affiliates increased for the three months ended March 31, 2002, as compared to the three months ended March 31, 2001, due to an increase in the Illinois replacement tax as a result of land sales in 2001.



Marketing expenses to Affiliates and non-affiliates increased for the three months ended March 31, 2002, as compared to the three months ended March 31, 2001, due to an increase in advertising and travel expenses relating to sale of parcels.

As of March 31, 2002, the Partnership has recorded an allowance for doubtful accounts of $1,000,000 and $336,712 relating to the mortgage receivable and accrued interest, respectively, relating to the sale of Parcel 15 and has written off the related deferred gain of $747,454.

PART II - Other Information

Items 1 through 6(b) are omitted because of the absence of conditions under which they are required.

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SIGNATURES





Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.







|      | INLAND LAND APPRECIATION FUND II, L.P.   
|----- | -----------------------------------------
|      |                                          
|By:   | Inland Real Estate Investment Corporation
|      | General Partner                          
|      |                                          
|      |                                          
|      | /S/ ROBERT D. PARKS                      
|      |                                          
|By:   | Robert D. Parks                          
|      | Chairman                                 
|Date: | May 14, 2002                             
|      |                                          
|      |                                          
|      | /S/ PATRICIA A. DELROSSO                 
|      |                                          
|By:   | Patricia A. DelRosso                     
|      | Senior Vice President                    
|Date: | May 14, 2002                             
|      |                                          
|      |                                          
|      | /S/ KELLY TUCEK                          
|      |                                          
|By:   | Kelly Tucek                              
|      | Principal Financial Officer and          
|      | Principal Accounting Officer             
|Date: | May 14, 2002                             

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