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


                                    FORM 10-Q


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

                For the quarterly period ended September 30, 1996

                                       or

     /   /      Transition Report Pursuant to Section 13 or 15(d)
                     of the Securities Exchange Act of 1934
                For the transition period from _______ to _______


                         Commission File No. 33-26097-08


                        PARKER & PARSLEY 90-B CONV., L.P.
             (Exact name of Registrant as specified in its charter)


              Delaware                                      75-2329284
     (State or other jurisdiction of                     (I.R.S. Employer
     incorporation or organization)                   Identification Number)

303 West Wall, Suite 101, Midland, Texas                       79701
(Address of principal executive offices)                     (Zip code)

       Registrant's Telephone Number, including area code : (915) 683-4768


                                 Not applicable
              (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 / /

                               Page 1 of __ pages.
                             -There are no exhibits-


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                        PARKER & PARSLEY 90-B CONV., L.P.

                                TABLE OF CONTENTS


                                                                        Page
                          Part I. Financial Information

Item 1.     Financial Statements

            Balance Sheets as of September 30, 1996 and
               December 31, 1995   ...................................    3

            Statements of Operations for the three and nine
              months ended September 30, 1996 and 1995................    4

            Statement of Partners' Capital for the nine months
              ended September 30, 1996................................    5

            Statements of Cash Flows for the nine months ended
              September 30, 1996 and 1995.............................    6

            Notes to Financial Statements.............................    7

Item 2.     Management's Discussion and Analysis of Financial
              Condition and Results of Operations.....................    7
                 


Part II.    Other Information.........................................   11

                Signatures............................................   12



                                        2

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                        PARKER & PARSLEY 90-B CONV., L.P.
                        (A Delaware Limited Partnership)

                          Part I. Financial Information

Item 1.   Financial Statements
                                 BALANCE SHEETS
                                                   September 30,  December 31,
                                                       1996          1995
                                                   ------------   -----------
                                                       (Unaudited)
                 ASSETS

Current assets:
  Cash and cash equivalents, including interest
    bearing deposits of $143,699 at September 30
    and $104,683 at December 31                    $   143,755    $   104,953
  Accounts receivable - oil and gas sales              124,967        112,651
                                                    ----------     ----------
           Total current assets                        268,722        217,604
                                                    ----------     ----------

Oil and gas properties - at cost,  based on the
  successful efforts accounting method               9,564,573      9,571,882
    Accumulated depletion                           (6,401,688)    (6,208,665)
                                                    ----------     ----------
           Net oil and gas properties                3,162,885      3,363,217
                                                    ----------     ----------
                                                   $ 3,431,607    $ 3,580,821
                                                    ==========     ==========

LIABILITIES AND PARTNERS' CAPITAL

Current liabilities:
  Accounts payable - affiliate                     $    48,544    $    72,585

Partners' capital:
  Limited partners (11,897 interests)                3,349,233      3,473,154
  Managing general partner                              33,830         35,082
                                                    ----------     ----------
                                                     3,383,063      3,508,236
                                                    ----------     ----------
                                                   $ 3,431,607    $ 3,580,821
                                                    ==========     ==========


The financial information included as of September 30, 1996 has been prepared by
           management without audit by independent public accountants.

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

                                        3

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                        PARKER & PARSLEY 90-B CONV., L.P.
                        (A Delaware Limited Partnership)

                            STATEMENTS OF OPERATIONS
                                   (Unaudited)

                                   Three months ended      Nine months ended
                                      September 30,           September 30,
                                 ---------------------   ---------------------
                                    1996       1995        1996         1995
                                 ---------   ---------   ---------   ---------
Revenues:
  Oil and gas                    $ 315,670   $ 271,559   $ 951,839   $ 880,783
  Interest                           2,158       2,012       5,315       5,237
  Salvage income from equipment
     disposals                         200         -         2,930         -
  Gain on sale of property             -           858         -           858
                                  --------    --------    --------    --------
                                   318,028     274,429     960,084     886,878
                                  --------    --------    --------    --------
Costs and expenses:
  Oil and gas production           126,020     131,721     388,934     408,367
  General and administrative        10,073       9,693      30,284      28,888
  Depletion                         60,875      69,910     194,017     218,868
  (Gain) loss on abandoned
     property                          -           (45)        744      (3,045)
  Abandoned property                   -           487         -         2,572
  Amortization of organization
     costs                             -         1,248         -         3,756
                                  --------    --------    --------    --------
                                   196,968     213,014     613,979     659,406
                                  --------    --------    --------    --------

Net income                       $ 121,060   $  61,415   $ 346,105   $ 227,472
                                  ========    ========    ========    ========
Allocation of net income:
  Managing general partner       $   1,211   $     626   $   3,461   $   2,312
                                  ========    ========    ========    ========

  Limited partners               $ 119,849   $  60,789   $ 342,644   $ 225,160
                                  ========    ========    ========    ========
Net income per limited
  partnership interest           $   10.07   $    5.11   $   28.80   $   18.93
                                  ========    ========    ========    ========
Distributions per limited
  partnership interest           $   14.45   $   11.83   $   39.22   $   38.35
                                  ========    ========    ========    ========

         The financial information included herein has been prepared by
           management without audit by independent public accountants.

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

                                        4

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                        PARKER & PARSLEY 90-B CONV., L.P.
                        (A Delaware Limited Partnership)

                         STATEMENT OF PARTNERS' CAPITAL
                                   (Unaudited)




                                     Managing
                                     general       Limited
                                     partner       partners         Total
                                    ---------     ----------      ----------

Balance at January 1, 1996          $  35,082     $3,473,154      $3,508,236

    Distributions                      (4,713)      (466,565)       (471,278)

    Net income                          3,461        342,644         346,105
                                     --------      ---------       ---------

Balance at September 30, 1996       $  33,830     $3,349,233      $3,383,063
                                     ========      =========       =========







         The financial information included herein has been prepared by
           management without audit by independent public accountants.

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

                                        5

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                        PARKER & PARSLEY 90-B CONV., L.P.
                        (A Delaware Limited Partnership)

                            STATEMENTS OF CASH FLOWS
                                   (Unaudited)

                                                          Nine months ended
                                                             September 30,
                                                        ----------------------
                                                           1996        1995
                                                        ---------    ---------
Cash flows from operating activities:

  Net income                                            $ 346,105    $ 227,472
  Adjustments to reconcile net income to net
    cash provided by operating activities:
      Depletion and amortization                          194,017      222,624
      (Gain) loss on abandoned property                       744       (3,045)
      Gain on sale of property                                -           (858)
      Salvage income from equipment disposals              (2,930)         -
  Changes in assets and liabilities:
      (Increase) decrease in accounts receivable          (12,316)      11,792
      Increase (decrease) in accounts payable             (13,384)      19,207
                                                         --------     --------
          Net cash provided by operating activities       512,236      477,192
                                                         --------      -------
Cash flows from investing activities:

  Additions to oil and gas properties                      (5,086)      (5,348)
  Proceeds from salvage income on equipment disposals       2,930          -
  Proceeds from equipment salvage on abandoned property       -          3,045
  Proceeds from sale of property                              -            858
                                                         --------     --------
          Net cash used in investing activities            (2,156)      (1,445)
                                                         --------     --------
Cash flows from financing activities:

  Cash distributions to partners                         (471,278)    (460,855)
                                                         --------     --------
Net increase in cash and cash equivalents                  38,802       14,892
Cash and cash equivalents at beginning of period          104,953       65,099
                                                         --------     --------
Cash and cash equivalents at end of period              $ 143,755    $  79,991
                                                         ========     ========


         The financial information included herein has been prepared by
           management without audit by independent public accountants.

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

                                        6

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                        PARKER & PARSLEY 90-B CONV., L.P.
                        (A Delaware Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS
                               September 30, 1996
                                   (Unaudited)

Note 1.

Parker & Parsley 90-B Conv.,  L.P. (the  "Registrant") is a limited  partnership
organized  in 1990 under the laws of the State of Texas and was  converted  to a
Delaware limited partnership on August 1, 1991.

The Registrant  engages  primarily in oil and gas  development and production in
Texas and is not involved in any industry segment other than oil and gas.

Note 2.

In the opinion of management, the Registrant's unaudited financial statements as
of September 30, 1996 and for the three and nine months ended September 30, 1996
and  1995  include  all  adjustments  and  accruals  consisting  only of  normal
recurring accrual adjustments which are necessary for a fair presentation of the
results for the  interim  period.  These  interim  results  are not  necessarily
indicative of results for a full year.

The  financial  statements  should  be read in  conjunction  with the  financial
statements and the notes thereto  contained in the  Registrant's  Report on Form
10-K for the year ended  December 31,  1995,  as filed with the  Securities  and
Exchange  Commission,  a copy of which is  available  upon request by writing to
Steven L. Beal, Senior Vice President,  303 West Wall, Suite 101, Midland, Texas
79701.

Item 2.     Management's Discussion and Analysis of Financial Condition
              and Results of Operations (1)

Results of Operations

Nine months ended  September 30, 1996 compared with nine months ended  September
   30, 1995

Revenues:

The Registrant's oil and gas revenues increased 8% to $951,839 from $880,783 for
the nine months ended September 30, 1996 and 1995, respectively. The increase in
revenues  resulted from a 21% increase in the average price  received per barrel
of oil and a 28% increase in the average price  received per mcf of gas,  offset
by a 12% decline in barrels of oil produced and sold and a 10% decline in mcf of
gas produced  and sold.  For the nine months ended  September  30, 1996,  35,167
barrels  of oil were sold  compared  to 39,969  for the same  period in 1995,  a
decrease of 4,802 barrels.  For the nine months ended September 30, 1996, 99,322
mcf of gas were sold compared to  110,419  mcf for the same  period in  1995,  a

                                        7

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decrease  of 11,097  mcf.  The  decrease  in  production  volumes was due to the
decline  characteristics of the Registrant's oil and gas properties.  Management
expects a certain  amount of decline in  production  to  continue  in the future
until the Registrant's economically recoverable reserves are fully depleted.

The average price received per barrel of oil increased $3.57 from $17.24 for the
nine months ended September 30, 1995 to $20.81 for the same period in 1996 while
the average  price  received  per mcf of gas  increased  from $1.74 for the nine
months ended September 30, 1995 to $2.22 for the same period in 1996. The market
price  for oil and gas has  been  extremely  volatile  in the past  decade,  and
management expects a certain amount of volatility to continue in the foreseeable
future.  The  Registrant may therefore sell its future oil and gas production at
average  prices lower or higher than that received  during the nine months ended
September 30, 1996.

Salvage  income  totaling  $2,930  was  received  during the nine  months  ended
September 30, 1996,  attributable  to credits  received from the disposal of oil
and gas equipment on one well that was plugged and abandoned in a prior year.

A gain on sale of property of $858 was  recognized  during the nine months ended
September 30, 1995. This gain was the result of proceeds  received from the sale
of mineral rights in an undevel oped property.

Costs and Expenses:

Total  costs and  expenses  decreased  to  $613,979  for the nine  months  ended
September  30,  1996 as compared  to  $659,406  for the same  period in 1995,  a
decrease  of $45,427,  or 7%. The  decrease  was due to  declines in  production
costs,  depletion,  abandoned  property costs and  amortization  of organization
costs,  offset by increases in general and  administrative  expenses ("G&A") and
loss on abandoned property.

Production  costs were $388,934 for the nine months ended September 30, 1996 and
$408,367 for the same period in 1995,  resulting in a $19,433  decrease,  or 5%.
The decrease was the result of less well repair and maintenance costs, offset by
an  increase  in  workover  costs  incurred  in  an  effort  to  stimulate  well
production.

G&A's  components are  independent  accounting and  engineering  fees,  computer
services,  postage and managing  general partner  personnel  costs.  During this
period, G&A increased,  in aggregate,  5% from $28,888 for the nine months ended
September 30, 1995 to $30,284 for the same period in 1996.

Depletion was $194,017 for the nine months ended  September 30, 1996 compared to
$218,868  for the same period in 1995,  representing  a decrease of $24,851,  or
11%. This decrease was primarily  attributable to the following  factors:  (i) a
reduction  in the  Registrant's  net  depletable  basis  from  charges  taken in
accordance with Statement of Financial Accounting Standards No. 121, "Accounting
for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed
Of" ("FAS 121"),  (ii) a reduction in oil  production  of 4,802  barrels for the
nine months ended September 30, 1996 as compared to the same period in 1995, and
(iii) an increase in oil and gas reserves  during the third quarter of 1996 as a
result of higher commodity prices.
                                        8

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A loss on abandoned property of $744 was recognized during the nine months ended
September  30,  1996.   The  loss  resulted  from  the  write-off  of  remaining
capitalized well costs on the abandonment of one saltwater disposal well. A gain
on  abandoned  property of $3,045 was  recognized  during the nine months  ended
September 30, 1995. This gain was the result of proceeds received from equipment
salvage on one fully depleted  abandoned  property.  Abandoned property costs of
$2,572  were  incurred  on one  well  abandoned  during  the nine  months  ended
September 30, 1995.

Three months ended September 30, 1996 compared with three months ended September
   30, 1995

Revenues:

The  Registrant's  oil and gas revenues  increased to $315,670 from $271,559 for
the three months ended September 30, 1996 and 1995, respectively, an increase of
16%. The increase in revenues  resulted from a 31% increase in the average price
received per barrel of oil and a 25% increase in the average price  received per
mcf of gas,  offset by an 11% decline in barrels of oil produced and sold and an
8% decline in mcf of gas produced and sold. For the three months ended September
30, 1996, 11,348 barrels of oil were sold compared to 12,706 for the same period
in 1995, a decrease of 1,358 barrels.  For the three months ended  September 30,
1996,  34,546 mcf of gas were sold  compared  to 37,678  for the same  period in
1995,  a  decrease  of  3,132  mcf.  The  decreases  were  due  to  the  decline
characteristics of the Registrant's oil and gas properties.

The average price received per barrel of oil increased  $5.03 from $16.49 during
the three months ended  September 30, 1995 to $21.52 for the same period in 1996
while the average price  received per mcf of gas increased from $1.65 during the
three months ended September 30, 1995 to $2.07 for the same period in 1996.

Salvage  income  totaling  $200 was  received  during  the  three  months  ended
September 30, 1996,  attributable  to credits  received from the disposal of oil
and gas equipment on one well that was plugged and abandoned in a prior year.

A gain on sale of property of $858 was recognized  during the three months ended
September 30, 1995. This gain was the result of proceeds received on the sale of
mineral rights in an undevel oped property.

Costs and Expenses:

Total costs and  expenses  decreased  to  $196,968  for the three  months  ended
September  30,  1996 as compared  to  $213,014  for the same  period in 1995,  a
decrease of  $16,046,  or 8%. This  decrease  was due to declines in  production
costs, amortization of organization costs, gain on abandoned property, depletion
and abandoned property costs, offset by an increase in G&A.

                                        9

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Production costs were $126,020 for the three months ended September 30, 1996 and
$131,721 for the same period in 1995,  resulting in an $5,701  decrease,  or 4%.
The decrease was the result of less well repair and maintenance costs.

G&A's  components are  independent  accounting and  engineering  fees,  computer
services,  postage and managing  general partner  personnel  costs.  During this
period, G&A increased, in aggregate,  4%, from $9,693 for the three months ended
September 30, 1995 to $10,073 for the same period in 1996.

Depletion was $60,875 for the three months ended  September 30, 1996 compared to
$69,910 for the same period in 1995,  representing a decrease of $9,035, or 13%.
This  decrease  was  primarily  attributable  to the  following  factors:  (i) a
reduction  in the  Registrant's  net  depletable  basis  from  charges  taken in
accordance with FAS 121, (ii) a reduction in oil production of 1,358 barrels for
the three  months  ended  September  30,  1996 as compared to the same period in
1995, and (iii) an increase in oil and gas reserves  during the third quarter of
1996 as a result of higher commodity prices.

A gain on abandoned property of $45 was recognized during the three months ended
September 30, 1995. This gain was the result of proceeds received from equipment
salvage on one fully depleted  abandoned  property.  Abandoned property costs of
$487 were incurred on one well abandoned during the three months ended September
30, 1995. There was no abandonment  activity for the same period ended September
30, 1996.

Liquidity and Capital Resources

Net Cash Provided by Operating Activities

Net cash  provided by operating  activities  increased  $35,044  during the nine
months ended  September 30, 1996 from the same period ended  September 30, 1995.
This increase was due to an increase in oil and gas sales, offset by an increase
in production costs paid.

Net Cash Used in Investing Activities

The Registrant's investing activities during the nine months ended September 30,
1996 and 1995, respectively, included $5,086 and $5,348 for expenditures related
to equipment replacement on various oil and gas properties.

Proceeds of $2,930 were received during the nine months ended September 30, 1996
from the sale of oil and gas  equipment  on one well  abandoned in a prior year.
Proceeds  of $3,045 were  received  from the  salvage of  equipment  on one well
abandoned during the nine months ended September 30, 1995.

Proceeds of $858 were received  during the nine months ended  September 30, 1995
from the sale of mineral rights in an undeveloped property.

                                       10

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Net Cash Used in Financing Activities

Cash was  sufficient  for the nine  months  ended  September  30,  1996 to cover
distributions  to the partners of $471,278 of which $466,565 was  distributed to
the limited partners and $4,713 to the managing  general  partner.  For the same
period ended  September 30, 1995, cash was sufficient for  distributions  to the
partners of $460,855 of which $456,247 was  distributed to the limited  partners
and $4,608 to the managing general partner.

It is expected  that future net cash  provided by operating  activities  will be
sufficient for any capital expenditures and any distributions. As the production
from the properties declines, distributions are also expected to decrease.

---------------

(1)    "Item 2. Management's  Discussion and Analysis of Financial Condition and
       Results of Operations"  contains forward looking  statements that involve
       risks and uncertainties. Accordingly, no assurances can be given that the
       actual  events and  results  will not be  materially  different  than the
       anticipated results described in the forward looking statements.


                           Part II. Other Information

None.


                                       11

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                        PARKER & PARSLEY 90-B CONV., L.P.
                        (A Delaware Limited Partnership)



                               S I G N A T U R E S



       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.


                                      PARKER & PARSLEY 90-B CONV., L.P.

                               By:    Parker & Parsley Development L.P.,
                                        Managing General Partner

                                      By:   Parker & Parsley Petroleum USA, Inc.
                                             ("PPUSA"), General Partner




Dated:  November 13, 1996      By:    /s/ Steven L. Beal
                                      ---------------------------------------
                                      Steven L. Beal, Senior Vice President
                                        and Chief Financial Officer of PPUSA



                                       12

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