SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C.  20549
                                
                           FORM 10-QSB
                                
           Quarterly Report Under Section 13 or 15(d)
             of The Securities Exchange Act of 1934
                                
             For the Quarter Ended:  March 31, 1998
                                
                Commission file number:  0-17467
                                
                                
            AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP
(Exact Name of Small Business Issuer as Specified in its Charter)


      State of Minnesota                   41-1603719
(State or other Jurisdiction of         (I.R.S. Employer
Incorporation or Organization)        Identification No.)


  1300 Minnesota World Trade Center, St. Paul, Minnesota 55101
            (Address of Principal Executive Offices)
                                
                          (612) 227-7333
                   (Issuer's telephone number)
                                
                                
                         Not Applicable
 (Former name, former address and former fiscal year, if changed
                       since last report)
                                
Check  whether  the issuer (1) filed all reports required  to  be
filed  by Section 13 or 15(d) of the Securities Exchange  Act  of
1934  during the 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
                                
         Transitional Small Business Disclosure Format:
                                
                        Yes             No   [X]
                                
                                
                                
                                
          AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP
                                
                                
                              INDEX
                                
                                
                                                    

PART I.  Financial Information

 Item 1. Balance Sheet as of March 31, 1998 and December 31, 1997    

         Statements for the Periods ended March 31, 1998 and 1997:

             Income                                     

             Cash Flows                                 

             Changes in Partners' Capital               

         Notes to Financial Statements              

 Item 2. Management's Discussion and Analysis   

PART II. Other Information

 Item 1. Legal Proceedings                         

 Item 2. Changes in Securities                      

 Item 3. Defaults Upon Senior Securities            

 Item 4. Submission of Matters to a Vote of Security  Holders 

 Item 5. Other Information                          

 Item 6. Exhibits and Reports on Form 8-K           

<PAGE>
          AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP
                                
                          BALANCE SHEET
                                
              MARCH 31, 1998 AND DECEMBER 31, 1997
                                
                           (Unaudited)
                                
                             ASSETS
  
                                                        1998          1997
CURRENT ASSETS:
  Cash and Cash Equivalents                         $ 3,090,444   $ 2,615,163
  Receivables                                            16,076         1,014
                                                     -----------   -----------
      Total Current Assets                            3,106,520     2,616,177
                                                     -----------   -----------
INVESTMENTS IN REAL ESTATE:
  Land                                                4,637,235     4,416,278
  Buildings and Equipment                             8,457,780     8,975,829
  Construction in Progress                              194,815        46,997
  Property Acquisition Costs                             28,454        52,844
  Accumulated Depreciation                           (2,596,689)   (2,778,790)
                                                     -----------   -----------
                                                     10,721,595    10,713,158
  Real Estate Held for Sale                             199,644       199,644
                                                     -----------   -----------
      Net Investments in Real Estate                 10,921,239    10,912,802
                                                     -----------   -----------
           Total Assets                             $14,027,759   $13,528,979
                                                     ===========   ===========
                                
                                
                       LIABILITIES AND PARTNERS' CAPITAL

CURRENT LIABILITIES:
  Payable to AEI Fund Management, Inc.              $    28,187   $    45,489
  Distributions Payable                                 306,205       168,778
  Unearned Rent                                          62,051             0
                                                     -----------   -----------
      Total Current Liabilities                         396,443       214,267
                                                     -----------   -----------
PARTNERS' CAPITAL (DEFICIT):
  General Partners                                      (65,099)      (68,265)
  Limited Partners, $1,000 Unit value;
   30,000 Units authorized; 23,389 Units issued;
   22,556 Units outstanding                          13,696,415    13,382,977
                                                     -----------   -----------
      Total Partners' Capital                        13,631,316    13,314,712
                                                     -----------   -----------
        Total Liabilities and Partners' Capital     $14,027,759   $13,528,979
                                                     ===========   ===========
                                
 The accompanying notes to financial statements are an integral
                     part of this statement.
</PAGE>
<PAGE>                                
          AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP
                                
                       STATEMENT OF INCOME
                                
                 FOR THE PERIODS ENDED MARCH 31
                                
                           (Unaudited)
                                

                                                        1998          1997

INCOME:
   Rent                                             $   372,487   $   308,113
   Investment Income                                     37,448        60,772
                                                     -----------   -----------
        Total Income                                    409,935       368,885
                                                     -----------   -----------

EXPENSES:
   Partnership Administration - Affiliates               66,321        58,861
   Partnership Administration and Property
      Management - Unrelated Parties                     22,533        27,325
   Depreciation                                          87,056        83,977
                                                     -----------   -----------
        Total Expenses                                  175,910       170,163
                                                     -----------   -----------

OPERATING INCOME                                        234,025       198,722

GAIN ON SALE OF REAL ESTATE                             416,282             0
                                                     -----------   -----------
NET INCOME                                          $   650,307   $   198,722
                                                     ===========   ===========

NET INCOME ALLOCATED:
   General Partners                                 $     6,503   $     1,988
   Limited Partners                                     643,804       196,734
                                                     -----------   -----------
                                                    $   650,307   $   198,722
                                                     ===========   ===========

NET INCOME PER LIMITED PARTNERSHIP UNIT
 (22,556 and 22,920 weighted average Units
  outstanding in 1998 and 1997)                     $     28.54   $      8.58
                                                     ===========   ===========


 The accompanying Notes to Financial Statements are an integral
                     part of this statement.
</PAGE>
<PAGE>
          AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP
                                
                     STATEMENT OF CASH FLOWS
                                
                 FOR THE PERIODS ENDED MARCH 31
                                
                           (Unaudited)
                                
                                
                                                        1998           1997

CASH FLOWS FROM OPERATING ACTIVITIES:
   Net  Income                                       $   650,307  $   198,723

   Adjustments to Reconcile Net Income to Net Cash
   Provided by Operating Activities:
     Depreciation                                         87,056       83,976
     Gain on Sale of Real Estate                        (416,282)           0
     Increase in Receivables                             (15,062)        (357)
     Decrease in Payable to
        AEI Fund Management, Inc.                        (17,302)     (66,205)
     Decrease in Security Deposit                              0      (37,307)
     Increase in Unearned Rent                            62,051       53,345
                                                      -----------  -----------
        Total Adjustments                               (299,539)      33,452
                                                      -----------  -----------
        Net Cash Provided By
        Operating Activities                             350,768      232,175
                                                      -----------  -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
   Investments in Real Estate                           (530,207)           0
   Proceeds from Sale of Real Estate                     850,996      315,229
                                                      -----------  -----------
        Net Cash Provided By
        Investing Activities                             320,789      315,229
                                                      -----------  -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
   Increase (Decrease) in Distributions Payable          137,427     (125,539)
   Distributions to Partners                            (333,703)    (339,609)
                                                      -----------  -----------
        Net Cash Used For
        Financing Activities                            (196,276)    (465,148)
                                                      -----------  -----------

NET INCREASE IN CASH AND CASH EQUIVALENTS                475,281       82,256

CASH AND CASH EQUIVALENTS, beginning of period         2,615,163    4,798,584
                                                      -----------  -----------
CASH AND CASH EQUIVALENTS, end of period             $ 3,090,444  $ 4,880,840
                                                      ===========  ===========
                                
 The accompanying Notes to Financial Statements are an integral
                     part of this statement.
</PAGE>
<PAGE>                                
          AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP
                                
            STATEMENT OF CHANGES IN PARTNERS' CAPITAL
                                
                 FOR THE PERIODS ENDED MARCH 31
                                
                           (Unaudited)



                                                                     Limited
                                                                   Partnership
                              General      Limited                    Units
                              Partners     Partners      Total     Outstanding


BALANCE, December 31, 1996   $ (62,780)  $13,925,996  $13,863,216    22,920.29

  Distributions                 (3,396)     (336,213)    (339,609)

  Net Income                     1,988       196,734      198,722
                              ---------   -----------  -----------  -----------
BALANCE, March 31, 1997      $ (64,188)  $13,786,517  $13,722,329    22,920.29
                              =========   ===========  ===========  ===========


BALANCE, December 31, 1997   $ (68,265)  $13,382,977  $13,314,712    22,555.89

  Distributions                 (3,337)     (330,366)    (333,703)

  Net Income                     6,503       643,804      650,307
                              ---------   -----------  -----------  -----------
BALANCE, March 31, 1998      $ (65,099)  $13,696,415  $13,631,316    22,555.89
                              =========   ===========  ===========  ===========


 The accompanying Notes to Financial Statements are an integral
                     part of this statement.
</PAGE>
                                
          AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP
                                
                  NOTES TO FINANCIAL STATEMENTS
                                
                         MARCH 31, 1998
                                
                           (Unaudited)
                                

(1)  The  condensed  statements included herein have been  prepared
     by  the Partnership, without audit, pursuant to the rules  and
     regulations  of  the Securities and Exchange  Commission,  and
     reflect   all  adjustments  which  are,  in  the  opinion   of
     management,  necessary to a fair statement of the  results  of
     operations for the interim period, on a basis consistent  with
     the  annual audited statements.  The adjustments made to these
     condensed   statements  consist  only  of   normal   recurring
     adjustments.   Certain information, accounting  policies,  and
     footnote    disclosures   normally   included   in   financial
     statements  prepared  in  accordance with  generally  accepted
     accounting principles have been condensed or omitted  pursuant
     to  such  rules  and  regulations,  although  the  Partnership
     believes  that  the  disclosures  are  adequate  to  make  the
     information  presented not misleading.  It is  suggested  that
     these  condensed financial statements be read  in  conjunction
     with  the  financial statements and the summary of significant
     accounting  policies  and  notes  thereto  included   in   the
     Partnership's latest annual report on Form 10-KSB.

(2)  Organization -

     AEI  Real Estate Fund XVII Limited Partnership (Partnership)
     was  formed  to  acquire and lease commercial properties  to
     operating tenants.  The Partnership's operations are managed
     by  AEI  Fund  Management  XVII, Inc.  (AFM),  the  Managing
     General Partner of the Partnership.  Robert P. Johnson,  the
     President  and  sole  shareholder  of  AFM,  serves  as  the
     Individual General Partner of the Partnership.  An affiliate
     of  AFM,  AEI  Fund  Management, Inc.,  (AEI)  performs  the
     administrative and operating functions for the Partnership.
     
     The   terms   of  the  Partnership  offering  call   for   a
     subscription  price of $1,000 per Limited Partnership  Unit,
     payable   on  acceptance  of  the  offer.   The  Partnership
     commenced  operations  on February  10,  1988  when  minimum
     subscriptions    of   2,000   Limited   Partnership    Units
     ($2,000,000)  were  accepted.   The  Partnership's  offering
     terminated  on  November 1, 1988 when the one-year  offering
     period expired.  The Partnership received subscriptions  for
     23,388.7 Limited Partnership Units ($23,388,700).
     
     Under  the  terms of the Limited Partnership Agreement,  the
     Limited  Partners and General Partners contributed funds  of
     $23,388,700 and $1,000, respectively.  During the  operation
     of the Partnership, any Net Cash Flow, as defined, which the
     General Partners determine to distribute will be distributed
     90% to the Limited Partners and 10% to the General Partners;
     provided,  however, that such distributions to  the  General
     Partners will be subordinated to the Limited Partners  first
     receiving an annual, noncumulative distribution of Net  Cash
     Flow equal to 10% of their Adjusted Capital Contribution, as
     defined,  and, provided further, that in no event  will  the
     General Partners receive less than 1% of such Net Cash  Flow
     per  annum.  Distributions to Limited Partners will be  made
     pro rata by Units.
                                
          AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP
                                
                  NOTES TO FINANCIAL STATEMENTS
                           (Continued)
                                
(2)  Organization - (Continued)

     Any  Net  Proceeds  of Sale, as defined, from  the  sale  or
     financing of the Partnership's properties which the  General
     Partners determine to distribute will, after provisions  for
     debts  and  reserves, be paid in the following  manner:  (i)
     first,  99%  to the Limited Partners and 1% to  the  General
     Partners until the Limited Partners receive an amount  equal
     to:  (a)  their Adjusted Capital Contribution  plus  (b)  an
     amount  equal  to 6% of their Adjusted Capital  Contribution
     per  annum, cumulative but not compounded, to the extent not
     previously distributed from Net Cash Flow; (ii) next, 99% to
     the  Limited  Partners and 1% to the General Partners  until
     the Limited Partners receive an amount equal to 14% of their
     Adjusted Capital Contribution per annum, cumulative but  not
     compounded, to the extent not previously distributed;  (iii)
     next, to the General Partners until cumulative distributions
     to the General Partners under Items (ii) and (iii) equal 15%
     of cumulative distributions to all Partners under Items (ii)
     and (iii).  Any remaining balance will be distributed 85% to
     the  Limited  Partners  and  15% to  the  General  Partners.
     Distributions to the Limited Partners will be made pro  rata
     by Units.
     
     For  tax  purposes,  profits  from  operations,  other  than
     profits  attributable  to  the  sale,  exchange,  financing,
     refinancing   or  other  disposition  of  the  Partnership's
     property,  will  be  allocated first in the  same  ratio  in
     which,  and  to the extent, Net Cash Flow is distributed  to
     the Partners for such year.  Any additional profits will  be
     allocated 90% to the Limited Partners and 10% to the General
     Partners.   In the event no Net Cash Flow is distributed  to
     the  Limited  Partners,  90% of  each  item  of  Partnership
     income,  gain  or credit for each respective year  shall  be
     allocated to the Limited Partners, and 10% of each such item
     shall be allocated to the General Partners.  Net losses from
     operations will be allocated 98% to the Limited Partners and
     2% to the General Partners.
     
     For  tax purposes, profits arising from the sale, financing,
     or  other disposition of the Partnership's property will  be
     allocated  in  accordance with the Partnership Agreement  as
     follows:  (i) first, to those Partners with deficit balances
     in  their capital accounts in an amount equal to the sum  of
     such  deficit  balances; (ii) second,  99%  to  the  Limited
     Partners  and 1% to the General Partners until the aggregate
     balance in the Limited Partners' capital accounts equals the
     sum  of the Limited Partners' Adjusted Capital Contributions
     plus  an  amount  equal  to 14% of  their  Adjusted  Capital
     Contributions  per annum, cumulative but not compounded,  to
     the  extent  not previously allocated; (iii) third,  to  the
     General Partners until cumulative allocations to the General
     Partners equal 15% of cumulative allocations.  Any remaining
     balance  will  be allocated 85% to the Limited Partners  and
     15%  to the General Partners.  Losses will be allocated  98%
     to the Limited Partners and 2% to the General Partners.
     
     The  General Partners are not required to currently  fund  a
     deficit capital balance. Upon liquidation of the Partnership
     or  withdrawal  by  a General Partner, the General  Partners
     will  contribute to the Partnership an amount equal  to  the
     lesser of the deficit balances in their capital accounts  or
     1%  of total Limited Partners' and General Partners' capital
     contributions.
     
                                
          AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP
                                
                  NOTES TO FINANCIAL STATEMENTS
                           (Continued)
                                
(3)  Investments in Real Estate -

     The  Partnership  owns a 65% interest  in  a  J.T.  McCord's
     restaurant  in  Mesquite, Texas.   In  December,  1995,  the
     Partnership took possession of the property after the lessee
     was  unable  to  perform under the terms of the  Lease.   In
     July,  1996,  the Partnership entered into an  agreement  to
     sell   the  property  to  an  unrelated  third  party.    In
     September,  1996,  the  Agreement  was  terminated  by   the
     purchaser.  The property was listed for sale or lease  until
     March, 1997 when it was re-leased to Texas Sports City Cafe,
     Ltd.  under a triple net lease agreement with a primary term
     of  12  years which may be renewed for up to two consecutive
     five-year  periods.  The Partnership's share of  the  annual
     base  rent  is $32,500 for the first lease year and  $58,500
     for  the  second  lease year, with rent  increases  in  each
     subsequent lease year of either three percent of  the  prior
     year's rent or three percent of gross receipts in years  two
     and  three and six percent of gross receipts thereafter,  to
     the  extent  they exceed the base rent.  While the  property
     was being re-leased, the Partnership was responsible for the
     real  estate taxes and other costs required to maintain  the
     property.
     
     In  January, 1996, the Cheddar's restaurant in Indianapolis,
     Indiana was destroyed by a fire.  The Partnership reached an
     agreement with the tenant and insurance company which called
     for termination of the Lease, demolition of the building and
     payment to the Partnership of $407,282 for the building  and
     equipment and $49,688 for lost rent.  The property will  not
     be  rebuilt  and the Partnership listed the land  for  sale.
     The  Partnership  recognized  net  disposition  proceeds  of
     $406,892  which resulted in a net gain of $78,290.   At  the
     time  of  disposition,  the  cost  and  related  accumulated
     depreciation was $512,433 and $183,831, respectively.  As of
     December 31, 1997, based on an analysis of market conditions
     in  the  area,  it  was determined the  fair  value  of  the
     Partnership's   interest  in  the  land  was   approximately
     $200,000.   In  the  fourth quarter of  1997,  a  charge  to
     operations  for  real  estate  impairment  of  $62,000   was
     recognized, which is the difference between the  book  value
     at  December  31,  1997 of $261,644 and the  estimated  fair
     value of $200,000.
     
     The  Partnership  owned  a 65.09% interest  in  the  Sizzler
     restaurant  at the King's Island Theme Park near Cincinnati,
     Ohio.    In  January,  1994,  the  Partnership  closed   the
     restaurant and listed it for sale or lease.  On January  23,
     1997,  the Partnership sold its interest in the property  to
     an  unrelated  third  party.  The Partnership  received  net
     sales proceeds of $315,229, which resulted in a net loss  of
     $503,600,  which was recognized as a real estate  impairment
     in  the  fourth  quarter of 1996.  Prior to  the  sale,  the
     Partnership  was responsible for the real estate  taxes  and
     other costs required to maintain the property.
     
     On  February 20, 1998, the Partnership sold the  am/pm  Mini
     Market  in Carson City, Nevada to an unrelated third  party.
     The  Partnership  received net sale  proceeds  of  $850,996,
     which  resulted in a net gain of $416,282.  At the  time  of
     sale,  the  cost  and related accumulated  depreciation  was
     $703,871 and $269,157, respectively.
     
                                
          AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP
                                
                  NOTES TO FINANCIAL STATEMENTS
                           (Continued)
                                
(3)  Investments in Real Estate - (Continued)

     During  the  first  three  months  of  1998  and  1997,  the
     Partnership distributed $12,622 and $56,910 of the net  sale
     proceeds   to   the  Limited  and  General  Partners   which
     represented  a  return of capital of  $0.55  and  $2.46  per
     Limited Partnership Unit, respectively.  In June, 1997,  the
     Managing General Partner filed a proxy statement to  propose
     an Amendment to the Limited Partnership Agreement that would
     allow  the Partnership to reinvest the majority of the sales
     proceeds  in  additional properties.  The  Amendment  passed
     with a majority of Units voting in favor of the Amendment.
     
     In October, 1997, the Partnership entered into a Development
     Financing  Commitment  under  which  the  Partnership  would
     advance  funds  for  the  construction  of  a  Timber  Lodge
     Steakhouse  restaurant in Rockford, Illinois.  The  purchase
     price was approximately $1,620,000.  The property would have
     been  leased to Timber Lodge Steakhouse, Inc. under a  Lease
     Agreement with a primary term of 20 years and annual  rental
     payments  of approximately $174,000.  In January, 1998,  the
     Commitment  was  terminated  by  mutual  agreement  of   the
     parties.
     
     On  November 18, 1997, the Partnership purchased  a  30.794%
     interest  in  a  Timber  Lodge  Steakhouse  in  St.   Cloud,
     Minnesota  for $493,492.  The property is leased  to  Timber
     Lodge  Steakhouse,  Inc.  under a  Lease  Agreement  with  a
     primary  term  of  20  years and annual rental  payments  of
     $51,537.  The remaining interests in the property are  owned
     by  AEI  Real  Estate  Fund XV Limited Partnership  and  AEI
     Institutional  Net  Lease  Fund  '93  Limited   Partnership,
     affiliates of the Partnership.
     
     On  December  10,  1997, the Partnership purchased  a  60.0%
     interest   in  a  TGI  Friday's  restaurant  in  Greensburg,
     Pennsylvania for $1,009,045.  The property is leased to Ohio
     Valley  Bistros, Inc. under a Lease Agreement with a primary
     term  of  15  years and annual rental payments of  $101,475.
     The  remaining interest in the property was purchased by AEI
     Income  & Growth Fund XXII Limited Partnership, an affiliate
     of the Partnership.
     
     On  December  23, 1997, the Partnership purchased  a  26.05%
     interest in a parcel of land in Troy, Michigan for $393,620.
     The  land is leased to Champps Entertainment, Inc. (Champps)
     under a Lease Agreement with a primary term of 20 years  and
     annual rental payments of $27,553.  Simultaneously with  the
     purchase  of  the  land,  the  Partnership  entered  into  a
     Development  Financing Agreement under which the Partnership
     will  advance  funds to Champps for the  construction  of  a
     Champps Americana restaurant on the site.  Through March 31,
     1998,   the  Partnership  had  advanced  $126,842  for   the
     construction  of the property and was charging  interest  on
     the  advances at a rate of 7%.  The Partnership's  share  of
     the  total  purchase price, including the cost of the  land,
     will be approximately $1,172,250.  After the construction is
     complete,  the  Lease Agreement will be amended  to  require
     annual  rental  payments  of  approximately  $123,000.   The
     remaining  interests in the property are owned by  AEI  Real
     Estate  Fund  XV Limited Partnership, AEI Real  Estate  Fund
     XVIII  Limited Partnership and AEI Net Lease Income & Growth
     Fund XIX Limited Partnership, affiliates of the Partnership.
     
                                
          AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP
                                
                  NOTES TO FINANCIAL STATEMENTS
                           (Continued)
                                
(3)  Investments in Real Estate - (Continued)

     On  January 15, 1998, the Partnership purchased a parcel  of
     land  in  Rochester, Minnesota for $406,778.   The  land  is
     leased to Timber Lodge Steakhouse, Inc. (TLS) under a  Lease
     Agreement with a primary term of 20 years and annual  rental
     payments  of  $30,133.  Simultaneously with the purchase  of
     the   land,  the  Partnership  entered  into  a  Development
     Financing Agreement under which the Partnership will advance
     funds  to  TLS  for  the  construction  of  a  Timber  Lodge
     Steakhouse restaurant on the site.  Through March 31,  1998,
     the Partnership had advanced $67,973 for the construction of
     the property and was charging interest on the advances at  a
     rate  of 7.5%.  The total purchase price, including the cost
     of  the  land, will be approximately $1,860,000.  After  the
     construction  is  complete,  the  Lease  Agreement  will  be
     amended  to  require annual rental payments of approximately
     $196,000.
     
     During  1997  and  the  first  three  months  of  1998,  the
     Partnership  incurred net costs of $55,986 relating  to  the
     review  of potential property acquisitions.  Of these costs,
     $27,532  have  been  capitalized  and  allocated  to   land,
     building and equipment.  The remaining costs of $28,454 have
     been   capitalized  and  will  be  allocated   to   property
     acquisitions in future periods.
     
(4)  Payable to AEI Fund Management -

     AEI  Fund  Management, Inc. performs the administrative  and
     operating functions for the Partnership.  The payable to AEI
     Fund   Management  represents  the  balance  due  for  those
     services.    This  balance  is  non-interest   bearing   and
     unsecured  and  is  to  be  paid in  the  normal  course  of
     business.


ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS

Results of Operations

        For  the three months ended March 31, 1998 and 1997,  the
Partnership  recognized rental income of $372,487  and  $308,113,
respectively.   During the same periods, the  Partnership  earned
investment income of $37,448 and $60,772, respectively.  In 1998,
rental  income increased as a result of rent received  from  four
property  acquisitions in 1997 and 1998, rent received  from  re-
leasing the restaurant in Mesquite, Texas, and rent increases  on
nine properties.  These increases in rental income were partially
offset by a decrease in rent due to a property sale in 1998 and a
decrease in investment income earned on the net proceeds prior to
the purchase of the additional properties.


ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS  (Continued)

        The  Partnership owns a 65% interest in a  J.T.  McCord's
restaurant   in   Mesquite,  Texas.   In  December,   1995,   the
Partnership took possession of the property after the lessee  was
unable  to perform under the terms of the Lease.  In July,  1996,
the Partnership entered into an agreement to sell the property to
an  unrelated third party.  In September, 1996, the Agreement was
terminated by the purchaser.  The property was listed for sale or
lease  until  March, 1997 when it was re-leased to  Texas  Sports
City Cafe, Ltd. under a triple net lease agreement with a primary
term  of  12 years which may be renewed for up to two consecutive
five-year  periods.  The Partnership's share of the  annual  base
rent  is  $32,500  for the first lease year and $58,500  for  the
second  lease year, with rent increases in each subsequent  lease
year  of  either three percent of the prior year's rent or  three
percent  of gross receipts in years two and three and six percent
of  gross receipts thereafter, to the extent they exceed the base
rent.   While  the property was being re-leased, the  Partnership
was  responsible  for  the  real estate  taxes  and  other  costs
required to maintain the property.

        The  Partnership owned a 65.09% interest in  the  Sizzler
restaurant at the King's Island Theme Park near Cincinnati, Ohio.
In  January,  1994,  the Partnership closed  the  restaurant  and
listed  it  for  sale  or  lease.   On  January  23,  1997,   the
Partnership  sold its interest in the property  to  an  unrelated
third  party.   The  Partnership received net sales  proceeds  of
$315,229,  which  resulted in a net loss of $503,600,  which  was
recognized  as a real estate impairment in the fourth quarter  of
1996.  Prior to the sale, the Partnership was responsible for the
real  estate  taxes  and  other costs required  to  maintain  the
property.

       During the three months ended March 31, 1998 and 1997, the
Partnership   paid   Partnership   administration   expenses   to
affiliated  parties of $66,321 and $58,861, respectively.   These
administration  expenses  include  costs  associated   with   the
management of the properties, processing distributions, reporting
requirements and correspondence to the Limited Partners.   During
the   same   periods,   the  Partnership   incurred   Partnership
administration  and property management expenses  from  unrelated
parties  of  $22,533 and $27,325, respectively.   These  expenses
represent  direct payments to third parties for legal and  filing
fees,  direct administrative costs, outside audit and  accounting
costs, taxes, insurance and other property costs.

        As  of March 31, 1998, the Partnership's annualized  cash
distribution  rate  was  7.44%, based  on  the  Adjusted  Capital
Contribution.   Distributions of Net Cash  Flow  to  the  General
Partners were subordinated to the Limited Partners as required in
the Partnership Agreement.  As a result, 99% of distributions and
income  were allocated to Limited Partners and 1% to the  General
Partners.

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

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


ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS  (Continued)

Liquidity and Capital Resources

        During  the  three  months  ended  March  31,  1998,  the
Partnership's cash balances increased $475,281 mainly as a result
of  the  sale of the am/pm Mini Market property discussed  below.
Net cash provided by operating activities increased from $232,175
in  1997 to $350,768 in 1998 as a result of an increase in income
in  1998 and net timing differences in the collection of payments
from the lessees and the payment of expenses.

        The  major components of the Partnership's cash flow from
investing activities are investments in real estate and  proceeds
from  the sale of real estate.  For the three months ended  March
31,  1998 and 1997, the Partnership generated cash flow from  the
sale  of  real  estate  of  $850,996 and $315,229,  respectively.
During the same periods, the Partnership expended $530,207 and $-
0-,  respectively,  to  invest in real properties  (inclusive  of
acquisition  expenses)  as the Partnership  reinvested  the  cash
generated from the property sales.

         In   January,   1996,   the  Cheddar's   restaurant   in
Indianapolis,  Indiana was destroyed by a fire.  The  Partnership
reached an agreement with the tenant and insurance company  which
called  for termination of the Lease, demolition of the  building
and  payment to the Partnership of $407,282 for the building  and
equipment  and $49,688 for lost rent.  The property will  not  be
rebuilt  and  the  Partnership listed the  land  for  sale.   The
Partnership recognized net disposition proceeds of $406,892 which
resulted  in  a net gain of $78,290.  At the time of disposition,
the  cost  and related accumulated depreciation was $512,433  and
$183,831,  respectively.  As of December 31, 1997,  based  on  an
analysis of market conditions in the area, it was determined  the
fair  value  of  the  Partnership's  interest  in  the  land  was
approximately $200,000.  In the fourth quarter of 1997, a  charge
to   operations  for  real  estate  impairment  of  $62,000   was
recognized,  which is the difference between the  book  value  at
December  31,  1997 of $261,644 and the estimated fair  value  of
$200,000.

        On February 20, 1998, the Partnership sold the am/pm Mini
Market  in Carson City, Nevada to an unrelated third party.   The
Partnership  received  net  sale  proceeds  of  $850,996,   which
resulted  in  a net gain of $416,282.  At the time of  sale,  the
cost  and  related  accumulated  depreciation  was  $703,871  and
$269,157, respectively.

        During  the  first  three months of 1998  and  1997,  the
Partnership  distributed  $12,622 and $56,910  of  the  net  sale
proceeds to the Limited and General Partners which represented  a
return  of  capital  of $0.55 and $2.46 per  Limited  Partnership
Unit,  respectively.  In June, 1997, the Managing General Partner
filed  a  proxy statement to propose an Amendment to the  Limited
Partnership  Agreement  that  would  allow  the  Partnership   to
reinvest  the  majority  of  the  sales  proceeds  in  additional
properties.  The Amendment passed with a majority of Units voting
in favor of the Amendment.

         In  October,  1997,  the  Partnership  entered  into   a
Development  Financing  Commitment under  which  the  Partnership
would  advance  funds  for the construction  of  a  Timber  Lodge
Steakhouse restaurant in Rockford, Illinois.  The purchase  price
was  approximately  $1,620,000.  The  property  would  have  been
leased  to  Timber Lodge Steakhouse, Inc. under a Lease Agreement
with  a  primary term of 20 years and annual rental  payments  of
approximately  $174,000.  In January, 1998,  the  Commitment  was
terminated by mutual agreement of the parties.


ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS  (Continued)

        On November 18, 1997, the Partnership purchased a 30.794%
interest in a Timber Lodge Steakhouse in St. Cloud, Minnesota for
$493,492.   The  property is leased to Timber  Lodge  Steakhouse,
Inc. under a Lease Agreement with a primary term of 20 years  and
annual  rental payments of $51,537.  The remaining  interests  in
the  property  are  owned  by AEI Real  Estate  Fund  XV  Limited
Partnership  and  AEI Institutional Net Lease  Fund  '93  Limited
Partnership, affiliates of the Partnership.

        On  December 10, 1997, the Partnership purchased a  60.0%
interest in a TGI Friday's restaurant in Greensburg, Pennsylvania
for  $1,009,045.  The property is leased to Ohio Valley  Bistros,
Inc. under a Lease Agreement with a primary term of 15 years  and
annual  rental payments of $101,475.  The remaining  interest  in
the  property  was  purchased by AEI Income &  Growth  Fund  XXII
Limited Partnership, an affiliate of the Partnership.

        On  December 23, 1997, the Partnership purchased a 26.05%
interest in a parcel of land in Troy, Michigan for $393,620.  The
land  is leased to Champps Entertainment, Inc. (Champps) under  a
Lease Agreement with a primary term of 20 years and annual rental
payments  of  $27,553.  Simultaneously with the purchase  of  the
land,  the  Partnership  entered  into  a  Development  Financing
Agreement  under  which  the Partnership will  advance  funds  to
Champps for the construction of a Champps Americana restaurant on
the  site.  Through March 31, 1998, the Partnership had  advanced
$126,842  for  the construction of the property and was  charging
interest  on  the  advances at a rate of 7%.   The  Partnership's
share  of  the total purchase price, including the  cost  of  the
land,  will  be approximately $1,172,250.  After the construction
is  complete,  the  Lease Agreement will be  amended  to  require
annual  rental payments of approximately $123,000.  The remaining
interests  in the property are owned by AEI Real Estate  Fund  XV
Limited   Partnership,  AEI  Real  Estate  Fund   XVIII   Limited
Partnership  and AEI Net Lease Income & Growth Fund  XIX  Limited
Partnership, affiliates of the Partnership.

       On January 15, 1998, the Partnership purchased a parcel of
land in Rochester, Minnesota for $406,778.  The land is leased to
Timber Lodge Steakhouse, Inc. (TLS) under a Lease Agreement  with
a primary term of 20 years and annual rental payments of $30,133.
Simultaneously  with  the purchase of the land,  the  Partnership
entered  into a Development Financing Agreement under  which  the
Partnership will advance funds to TLS for the construction  of  a
Timber  Lodge  Steakhouse restaurant on the site.  Through  March
31,   1998,  the  Partnership  had  advanced  $67,973   for   the
construction  of  the property and was charging interest  on  the
advance  at a rate of 7.5%.  The total purchase price,  including
the  cost  of the land, will be approximately $1,860,000.   After
the construction is complete, the Lease Agreement will be amended
to require annual rental payments of approximately $196,000.

       The Partnership's primary use of cash flow is distribution
and  redemption  payments to Partners.  The Partnership  declares
its  regular  quarterly  distributions before  the  end  of  each
quarter and pays the distribution in the first week after the end
of  each quarter.  The Partnership attempts to maintain a  stable
distribution  rate from quarter to quarter.  Redemption  payments
are  paid  to  redeeming  Partners on  a  quarterly  basis.   The
redemption  payments generally are funded with  cash  that  would
normally  be paid as part of the regular quarterly distributions.
As  a  result, total distributions and distributions payable have
fluctuated  from year to year due to cash used to fund redemption
payments.


ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS  (Continued)

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

        On  April  1, 1998, fourteen Limited Partners redeemed  a
total  of  137.20  Units  for  $99,154  in  accordance  with  the
Partnership  Agreement.   The Partnership  acquired  these  Units
using Net Cash Flow from operations.  In prior years, a total  of
forty-five Limited Partners redeemed 832.9 Partnership Units  for
$491,344.    The  redemptions  increase  the  remaining   Limited
Partners' ownership interest in the Partnership.

       The continuing rent payments from the properties, together
with  cash generated from the property sales, should be  adequate
to  fund  continuing  distributions and  meet  other  Partnership
obligations on both a short-term and long-term basis.

Cautionary Statement for Purposes of the "Safe Harbor" Provisions
of the Private Securities Litigation Reform Act of 1995

         The   foregoing  Management's  Discussion  and  Analysis
contains various "forward looking  statements" within the meaning
of   federal   securities   laws  which  represent   management's
expectations  or  beliefs  concerning  future  events,  including
statements  regarding anticipated application of  cash,  expected
returns  from rental income, growth in revenue, taxation  levels,
the  sufficiency  of  cash to meet operating expenses,  rates  of
distribution,  and  other  matters.   These,  and  other  forward
looking statements made by the Partnership, must be evaluated  in
the   context  of  a  number  of  factors  that  may  affect  the
Partnership's  financial  condition and  results  of  operations,
including the following:

<bullet>  Market  and economic conditions which affect the  value
          of  the  properties the Partnership owns and  the  cash
          from rental income such properties generate;
       
<bullet>  the  federal income tax consequences of rental  income,
          deductions,  gain  on  sales and other  items  and  the
          affects of these consequences for investors;
       
<bullet>  resolution  by  the General Partners of conflicts  with
          which they may be confronted;
       
<bullet>  the   success  of  the  General  Partners  of  locating
          properties with favorable risk return characteristics;
       
<bullet>  the effect of tenant defaults; and
       
<bullet>  the condition of the industries in which the tenants of
          properties owned by the Partnership operate.


                   PART II - OTHER INFORMATION
                                
ITEM 1. LEGAL PROCEEDINGS

       There  are no material pending legal proceedings to  which
  the  Partnership  is  a  party or of  which  the  Partnership's
  property is subject.

ITEM 2. CHANGES IN SECURITIES

      None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

      None.

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

      None.

ITEM 5. OTHER INFORMATION

      None.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

        a. Exhibits -
                        Description

           10.1  Purchase  Agreement  dated  December
                 17,   1997  between  the  Partnership  and
                 Atlantic  Richfield  Company  relating  to
                 the  property  at  2707  U.S.  Highway  50
                 East, Carson City, Nevada.

            27   Financial Data Schedule  for  period
                 ended March 31, 1998.

        b. Reports filed on Form  8-K  -  None.


                           SIGNATURES
                                
     In accordance with the requirements of the Exchange Act, the
Registrant has caused this report to be signed on its  behalf  by
the undersigned, thereunto duly authorized.


Dated:  May 12, 1998          AEI Real Estate Fund XVII
                              Limited Partnership
                              By:  AEI Fund Management XVII, Inc.
                              Its: Managing General Partner



                              By: /s/ Robert P Johnson
                                      Robert P. Johnson
                                      President
                                      (Principal Executive Officer)



                              By: /s/ Mark E Larson
                                      Mark E. Larson
                                      Chief Financial Officer
                                      (Principal Accounting Officer)