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, 1997


                                    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 #0-16780


                 Inland Real Estate Growth Fund II, L.P. 
          (Exact name of registrant as specified in its charter)


         Delaware                                     #36-3547165
  (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   






                                    -1-



                  INLAND REAL ESTATE GROWTH FUND II, L.P.
                          (a limited partnership)

                              Balance Sheets

                 September 30, 1997 and December 31, 1996
                                (unaudited)

                                    Assets
                                    ------
                                                       1997          1996
                                                       ----          ----
Current assets:
  Cash and cash equivalents including amounts
    held by property manager (Note 1)............. $   111,172       152,259 
  Accrued interest receivable.....................          55           247
                                                   ------------  ------------
    Total current assets..........................     111,227       152,506
                                                   ------------  ------------
Investment property (including acquisition fees
    paid to Affiliates of $59,500 at September 30,
    1997 and December 31, 1996 (Notes 1 and 2):
  Land............................................     438,389       438,389
  Building and improvements.......................   1,096,872     1,096,872
                                                   ------------  ------------
                                                     1,535,261     1,535,261
  Less accumulated depreciation...................     310,976       283,553
    Total investment property, net of              ------------  ------------
      accumulated depreciation....................   1,224,285     1,251,708
                                                   ------------  ------------
Installment contracts receivable (Note 3).........      80,000        80,000
Accrued rents receivable (Notes l and 4)..........      67,637        79,374
Deferred loan costs (net of accumulated
  amortization of $7,325 at September 30, 1997
  (Note 1)........................................      15,143          -
Deferred leasing fees to Affiliates (net of
  accumulated amortization of $15,325 and $13,326
  at September 30, 1997 and December 31, 1996,
  respectively) (Note 1)..........................      10,661        12,660
                                                   ------------  ------------
Total assets...................................... $ 1,508,953     1,576,248
                                                   ============  ============













                See accompanying notes to financial statements.


                                    -2-



                    INLAND REAL ESTATE GROWTH FUND II, L.P.
                            (a limited partnership)

                                Balance Sheets
                                  (continued)

                   September 30, 1997 and December 31, 1996
                                  (unaudited)

                       Liabilities and Partners' Capital
                       ---------------------------------
                                                       1997          1996
Current liabilities:                                   ----          ----
  Mortgage payable................................ $    59,236        59,021
  Accrued interest payable........................        -            6,275
  Due to Affiliates (Note 2)......................       3,310         1,159
                                                   ------------  ------------
    Total current liabilities.....................      62,546        66,455
                                                   ------------  ------------
Commission payable to Affiliates (Note 2).........     135,000       135,000
Long-term debt, less current portion
  (Notes 3 and 3).................................     802,959       851,755
                                                   ------------  ------------
    Total liabilities.............................   1,000,505     1,053,210

Deferred gain on sale of investment property
  (Note 3)........................................       9,950         9,950

Partners' capital (Notes 1 and 2):
  General Partner:
    Capital contribution..........................         500           500
    Cumulative net income.........................      15,414        15,060
    Cumulative cash distributions.................      (9,241)       (8,861)
                                                   ------------  ------------
                                                         6,673         6,699
  Limited Partners:                                ------------  ------------
    Units of $1,000. Authorized 25,000 Units,
      4,004.25 Units outstanding September 30,
      1997 and at December 31, 1996 (net of
      offering costs of $462,849, of which
      $59,476 was paid to Affiliates).............   3,541,408     3,541,408
    Cumulative net income.........................   1,526,031     1,491,012
    Cumulative cash distributions.................  (4,575,614)   (4,526,031)
                                                   ------------  ------------
                                                       491,825       506,389
                                                   ------------  ------------
      Total Partners' capital.....................     498,498       513,088
                                                   ------------  ------------
Total liabilities and Partners' capital........... $ 1,508,953     1,576,248
                                                   ============  ============




                See accompanying notes to financial statements.


                                    -3-



                    INLAND REAL ESTATE GROWTH FUND II, L.P.
                            (a limited partnership)

                           Statements of Operations

        For the three and nine months ended September 30, 1997 and 1996
                                  (unaudited)


                                        Three months            Nine months
                                           ended                  ended
                                        September 30,          September 30,
                                        -------------          -------------
                                       1997       1996       1997       1996
Income:                                ----       ----       ----       ----
  Rental income (Note 4)........... $  51,661     51,661    154,983    154,983
  Interest income..................     3,259      3,318      9,748      9,275
                                    ---------- ---------- ---------- ----------
                                       54,920     54,979    164,731    164,258
                                    ---------- ---------- ---------- ----------
Expenses:
  Professional services to
    Affiliates.....................     1,525      1,090      3,937      5,113
  Professional services to
    non-affiliates.................      -          -        17,575     18,600
  General and administrative
    expenses to Affiliates.........     2,727      3,627     11,027     10,492
  General and administrative
    expenses to non-affiliates.....       921        429      3,528      3,437
  Property operating expenses to
    Affiliates.....................       555        505      1,667      1,515
  Mortgage interest................    17,995     25,377     54,877     68,417
  Depreciation.....................     9,142      9,141     27,423     27,423
  Amortization.....................     3,505        667      9,324      3,169
                                    ---------- ---------- ---------- ----------
                                       36,370     40,836    129,358    138,166
                                    ---------- ---------- ---------- ----------
Net income......................... $  18,550     14,143     35,373     26,092
                                    ========== ========== ========== ==========

Net income allocated to:
  General Partner.................. $     186        142        354        261
  Limited Partners.................    18,364     14,001     35,019     25,831
                                    ---------- ---------- ---------- ----------
    Net income..................... $  18,550     14,143     35,373     26,092
                                    ========== ========== ========== ==========

Net income allocated to the one
  General Partner Unit............. $     186        142        354        261
                                    ========== ========== ========== ==========

Net income per 4,004.25 weighted
  average Limited Partner Units.... $    4.59       3.50       8.75       6.45
                                    ========== ========== ========== ==========


                See accompanying notes to financial statements.


                                    -4-



                    INLAND REAL ESTATE GROWTH FUND II, L.P.
                            (a limited partnership)

                           Statements of Cash Flows

             For the nine months ended September 30, 1997 and 1996
                                  (unaudited)


                                                       1997          1996
Cash flows from operating activities:                  ----          ----
  Net income...................................... $    35,373        26,092
  Adjustments to reconcile net income to net
      cash provided by operating activities:
    Accrued rents receivable......................      11,737        (3,422)
    Deferred loan costs...........................     (22,468)         -
    Depreciation..................................      27,423        27,423
    Amortization..................................       9,324         3,169
    Changes in assets and liabilities:
      Accrued interest receivable.................         192          (287)
      Accounts payable and accrued expenses.......        -             (926)
      Accrued interest payable....................      (6,275)       (1,217)
      Due to Affiliates...........................       2,151        (2,206)
                                                   ------------  ------------
Net cash provided by operating activities.........      57,457        48,626
                                                   ------------  ------------
Cash flows from financing activities:
  Principal payments of long-term debt............     (48,581)      (22,454)
  Distributions...................................     (49,963)      (17,000)
                                                   ------------  ------------
Net cash used in financing activities.............     (98,544)      (39,454)
                                                   ------------  ------------
Net increase (decrease) in cash and cash
  equivalents.....................................     (41,087)        9,172
Cash and cash equivalents at beginning of period..     152,259       106,980
                                                   ------------  ------------
Cash and cash equivalents at end of period........ $   111,172       116,152
                                                   ============  ============


Supplemental disclosure of cash flow information:

  Cash paid for mortgage and other interest....... $    61,152        59,398
                                                   ============  ============











                See accompanying notes to financial statements.


                                    -5-



                    INLAND REAL ESTATE GROWTH FUND II, L.P.
                            (a limited partnership)

                         Notes to Financial Statements

                              September 30, 1997
                                  (unaudited)


Readers of this  Quarterly  Report  should  refer  to the Partnership's audited
financial statements for the  fiscal  year  ended  December 31, 1996, which are
included  in  the  Partnership's  1996   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

Inland Real Estate Growth Fund II, L.P. (the "Partnership"), was formed in June
1987, pursuant to  the  Delaware  Revised  Uniform  Limited Partnership Act, to
invest in improved residential,  retail,  industrial and other income producing
properties.  On September 21,  1987,  the  Partnership commenced an Offering of
25,000 Limited  Partnership  Units  (the  "Units")  pursuant  to a Registration
Statement on Form S-11  under  the  Securities  Act  of  1933.  The Partnership
terminated the Offering on September 21, 1989.   A total of 4,038.25 Units were
sold to the public  at  $1,000  per  Unit,  yielding gross offering proceeds of
$4,038,250, not including the General  Partner's  contribution of $500.  All of
the holders of these Units were  admitted  to the Partnership.  As of September
30, 1996, the Partnership has  repurchased  a  total of 34 Units ($33,993) from
various Limited Partners.  At  September  30,  1997,  included in cash and cash
equivalents, is approximately $13,900 restricted for use by the Unit Repurchase
Program.  The Limited Partners  of  the  Partnership  share in their portion of
benefits of ownership of  the  Partnership's real property investment according
to the number of Units held.   Inland Real Estate Investment Corporation is the
General Partner.

The preparation of financial  statements  in conformity with generally accepted
accounting principles 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.

Offering costs have been offset against the Limited Partners' capital accounts.

Deferred loan costs are amortized on a straight-line basis over the life of the
loan.  Deferred leasing fees  are  amortized  on a straight-line basis over the
term of the related lease.

Installment contracts  receivable  origination  fees  received  are deferred as
unearned income and amortized  as  yield  adjustments  on a straight-line basis
over the life of the related installment contracts receivable.






                                    -6-



                    INLAND REAL ESTATE GROWTH FUND II, L.P.
                            (a limited partnership)

                         Notes to Financial Statements
                                  (continued)

                              September 30, 1997
                                  (unaudited)


Statement of Financial Accounting Standards No. 121 requires the Partnership to
record an impairment loss on  its  property  to be held for investment whenever
its carrying value  cannot  be  fully  recovered through estimated undiscounted
future cash flows from their operations and sale.  The amount of the impairment
loss to be recognized would  be  the difference between the property's carrying
value and the property's estimated fair  value.   As of September 30, 1997, the
Partnership has not recognized any such impairment on its property.


The Partnership uses the  straight-line  method  of  depreciation with a useful
life of thirty years for  buildings  and  improvements.  Maintenance and repair
expenses are charged to operations  as  incurred.  Significant improvements are
capitalized and depreciated over their estimated useful lives.

Rental income is recognized  on  a  straight-line  basis  over  the term of the
lease.  The excess of rental  income  earned  over  the cash rent due under the
provisions of the lease agreement is recorded as accrued rent receivable.

The Partnership  considers  all  highly  liquid  investments  purchased  with a
maturity of three months or less to be cash equivalents.

No provision for Federal income taxes  has  been made as the liability for such
taxes is that of the Partners rather than the Partnership.

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.  Interim periods are
not necessarily indicative of results to be expected for the year.



















                                    -7-



                    INLAND REAL ESTATE GROWTH FUND II, L.P.
                            (a limited partnership)

                         Notes to Financial Statements
                                  (continued)

                              September 30, 1997
                                  (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, of which $3,310 and $1,159
remained unpaid at September 30, 1997 and December 31, 1996, respectively.

In connection with the sales at  Wellington Place, the Partnership has recorded
$135,000 of sales commissions  payable  to  Affiliates  of the General Partner.
Such commissions will  be  deferred  until  the  Limited Partners have received
their Original Capital plus a return as specified in the Partnership Agreement.

An Affiliate of the General Partner  is entitled to receive Property Management
Fees for management and leasing services.  Management fees of $1,667 and $1,515
for the nine months ended September  30,  1997 and 1996, have been incurred and
paid to an Affiliate and  are  included in the Partnership's property operating
expenses to Affiliates.

(3) Installment Contracts Receivable

During 1991, the Partnership sold all  of the eighteen buildings comprising the
Wellington  Place  apartment  complex  to  unaffiliated  third  parties.    The
Partnership  had  recorded  wrap  around  installment  contracts  receivable of
$3,988,999 as a result of these  sales,  with interest rates ranging from 10.5%
to 10.9% due  over  seven  to  ten  years.    The  gain  of  $616,858 was to be
recognized as cash  was  received  over  the  life  of  the related installment
contracts.

The Partnership  has  received  complete  prepayments  on  all  of the eighteen
installment  contracts  receivable  amounting  to  $3,609,589,  which  included
prepayment penalties of  $10,830,  less  credit  to  the  borrowers for prepaid
interest.   In  conjunction  with  five  of  the  prepayments,  the Partnership
provided a single borrower with five second mortgages, in the amount of $16,000
each, which require interest-only payments at the  rate of 10% per annum with a
final balloon  payment  due  June  30,  1998,  collateralized  by  five  of the
buildings previously sold.










                                    -8-



                    INLAND REAL ESTATE GROWTH FUND II, L.P.
                            (a limited partnership)

                         Notes to Financial Statements
                                  (continued)

                              September 30, 1997
                                  (unaudited)



(4) Accrued Rents Receivable

The health club lease contains provisions providing for stepped rent increases.
Generally accepted accounting principles require that rental income be recorded
for the period of  occupancy  using  the  effective  monthly rent, which is the
average monthly rent for the entire period  of occupancy during the term of the
lease.  The accompanying financial statements include a decrease of $11,737 and
an increase of $3,422 in 1997  and  1996, respectively of rental income for the
period of occupancy for  which  stepped  rent  increases  apply and $67,637 and
$79,374 in related accounts receivable  as  of  September 30, 1997 and December
31, 1996, respectively.  Those  amounts  are  expected to be collected over the
terms of the related leases as scheduled rent payments are made.

(5) Mortgage Payable

The General Partner  obtained  an  extension  until  February  1, 1999 from the
current first  mortgage  holder  on  the  mortgage  loan  collateralized by the
Scandinavian Health Club property.  Monthly principal and interest payments are
based on an interest  rate  of  8.25%  adjusted  annually,  based on a ten year
amortization period.

(6) Subsequent Events

During October 1997, the Partnership  paid  a distribution of $15,220, of which
$132 was distributed to the General  Partner and $15,088 was distributed to the
Limited Partners.    The  Limited  Partners'  distribution  included  $2,000 of
repayment proceeds and $13,088 of operating cash flow.



















                                    -9-



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 of "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 September 21, 1987, the Partnership  commenced an Offering of 25,000 Limited
Partnership Units pursuant to a  Registration  Statement on Form S-11 under the
Securities Act of 1933.  The  Offering  terminated on September 21, 1989 with a
total of 4,038.25 Units being sold  to  the public at $1,000 per Unit resulting
in $4,038,250 in gross offering  proceeds,  not including the General Partner's
contribution, of which $3,077,513 was invested in two properties.  In addition,
proceeds were used to repay advances from the General Partner, pay offering and
organization costs and  make  distributions  to  the  Limited  Partners.  As of
September 30, 1997, the  Partnership  has  repurchased  34 Units ($33,993) from
various Limited Partners through the Unit Repurchase Program.

At September  30,  1997,  the  Partnership  had  cash  and  cash equivalents of
$111,172, which includes approximately $13,900 restricted for the repurchase of
Units through the Unit  Repurchase  Program.    The  Partnership intends to use
available cash for working capital requirements and cash distributions.

The Partnership is generating sufficient  cash flow to cover operating expenses
and debt service.  To the  extent  that  these sources are insufficient to meet
the Partnership's needs, the Partnership  may  rely on advances from Affiliates
of the General Partner, other  short-term  financing  or may sell the remaining
property.

The General Partner has agreed  to  make,  if necessary, a Supplemental Capital
Contribution.  The  Supplemental  Capital  Contribution  shall  be in an amount
which will enable the  Partnership  to  pay  a  liquidating distribution to the
Limited Partners equal to their  Adjusted Invested Capital plus a noncompounded
Minimum Return of 2% per annum  on their Invested Capital.  After consideration
of the Supplemental Capital Contribution,  the Partnership believes that it has
sufficient funds to satisfy its obligations.







                                   -10-



Results of Operations

As of December 31, 1991, the Partnership had sold all of the eighteen buildings
comprising the Wellington  Place  Apartment  complex.    The remaining property
owned by the  Partnership,  a  health  club,  is  leased  until October 2001 to
Scandinavian Health Spa Inc., a  wholly  owned subsidiary of Bally's Health and
Tennis Corporation on a  "triple-net"  basis,  which  means that in addition to
paying base rent, the tenant is  also responsible for the payment of insurance,
real estate taxes and maintenance.   The General Partner does not anticipate an
early termination of this lease.

The decrease in professional services  to  Affiliates for the nine months ended
September 30, 1997, as compared to the nine months ended September 30, 1996, is
due to a decrease in accounting fees to Affiliates.

The increase in general and administrative  expenses to Affiliates for the nine
months ended September 30, 1997, as compared to the nine months ended September
30, 1996, is due to an increase in data processing.

The decrease in mortgage interest expense  for  the three and nine months ended
September 30, 1997, as compared  to  the  three and nine months ended September
30, 1996, is due to a  decrease  in  the adjustable rate mortgage on the health
club property from 9.625% to 8.25% in May 1996.  

The increase in  amortization  expense  for  the  three  and  nine months ended
September 30, 1997, as compared  to  the  three and nine months ended September
30, 1996, is due to loan  costs  associated  with the extension of the mortgage
loan collateralized by the  Scandinavian  Health  Club property which are being
amortized on a straight-line basis over the life of the loan.


                          PART II - Other Information

Items 1 through 5 are omitted  because  of the absence of conditions under which
they are required.

Item 6.  Exhibits and Reports on Form 8-K

     (a) Exhibits:

         (27) Financial Data Schedule

     (b) Reports on Form 8-K:

         None












                                   -11-



                                  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 REAL ESTATE GROWTH FUND II, L.P.

                            By:   Inland Real Estate Investment Corporation
                                  General Partner


                                  /S/ ROBERT D. PARKS

                            By:   Robert D. Parks
                                  Chairman
                            Date: November 12, 1997


                                  /S/ PATRICIA A. CHALLENGER
         
                            By:   Patricia A. Challenger
                                  Senior Vice President
                            Date: November 12, 1997


                                  /S/ KELLY TUCEK
         
                            By:   Kelly Tucek
                                  Principal Financial Officer and
                                  Principal Accounting Officer
                            Date: November 12, 1997





















                                   -12-