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, 1998
                                      ------------------------------------------


                                       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 number  0-14007
                           -----------



                        MCNEIL REAL ESTATE FUND XX, L.P.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)





         California                            33-0050225
--------------------------------------------------------------------------------
(State or other jurisdiction of               (I.R.S. Employer
incorporation or organization)                 Identification No.)



             13760 Noel Road, Suite 600, LB70, Dallas, Texas, 75240
--------------------------------------------------------------------------------
               (Address of principal executive offices) (Zip code)



Registrant's telephone number, including area code        (972) 448-5800
                                                    ----------------------------



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 and (2) has been  subject to such  filing
requirements for the past 90 days. Yes X No
                                      ---  ---
<PAGE>
                          PART I. FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS
-------  ---------------------

                        MCNEIL REAL ESTATE FUND XX, L.P.

                                 BALANCE SHEETS
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                         September 30,        December 31,
                                                                             1998                 1997
                                                                         -------------        ------------

ASSETS
------

Real estate investments:
<S>                                                                      <C>                  <C>         
   Land .........................................................        $    392,000         $    392,000
   Buildings and improvements ...................................           3,930,435            3,882,558
                                                                         ------------         ------------
                                                                            4,322,435            4,274,558
   Less:  Accumulated depreciation ..............................          (1,467,812)          (1,290,949)
                                                                         ------------         ------------
                                                                            2,854,623            2,983,609

Mortgage loan investments, net of allowance of
   $792,013 at December 31, 1997 ................................                  --            3,268,712
Mortgage loan investments - affiliate, net of allowance
   of $130,000 at December 31, 1997 .............................                  --            3,600,076
Cash and cash equivalents .......................................           3,026,759            1,824,293
Cash segregated for security deposits ...........................              25,491               27,405
Interest and other accounts receivable ..........................               5,963              140,025
Escrow deposits .................................................             138,445              162,652
Deferred borrowing costs, net of accumulated
   amortization of $72,171 and $60,222 at September 30,
   1998 and December 31, 1997, respectively .....................              89,323              101,272
Prepaid expenses and other assets ...............................               4,200                4,200
                                                                         ------------         ------------
                                                                         $  6,144,804         $ 12,112,244
                                                                         ============         ============

LIABILITIES AND PARTNERS' EQUITY (DEFICIT)
------------------------------------------

Mortgage note payable, net ......................................        $  2,627,163         $  2,666,814
Accounts payable and other accrued expenses .....................              43,300               61,994
Accrued property taxes ..........................................             118,985              137,050
Payable to affiliates ...........................................             319,178              203,444
Deferred revenue ................................................                  --               27,229
Security deposits and deferred rental revenue ...................              29,061               29,494
                                                                         ------------         ------------
                                                                            3,137,687            3,126,025
                                                                         ------------         ------------

Partners' equity (deficit):
   Limited partners - 60,000 limited partnership units
     authorized;  49,512 limited partnership units issued
     and outstanding at September 30, 1998 and
     December 31, 1997 ..........................................           3,291,047            9,282,684
   General Partner ..............................................            (283,930)            (296,465)
                                                                         ------------         ------------
                                                                            3,007,117            8,986,219
                                                                         ------------         ------------
                                                                         $  6,144,804         $ 12,112,244
                                                                         ============         ============
</TABLE>

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

                 See accompanying notes to financial statements.
<PAGE>
                        McNEIL REAL ESTATE FUND XX, L.P.

                            STATEMENTS OF OPERATIONS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                       Three Months Ended                   Nine Months Ended
                                                          September 30,                        September 30,
                                                 ----------------------------        -----------------------------
                                                     1998              1997             1998               1997
                                                 ----------        ----------        ----------        -----------
     
Revenue:
<S>                                              <C>               <C>               <C>               <C>       
   Rental revenue .......................        $  320,966        $  308,473        $  967,846        $  966,384
   Interest income on mortgage
     loan investments ...................            42,092            80,065           180,872           210,317
   Interest income on mortgage
     loan investments - affiliate........                --            15,473           108,214            45,915
   Other interest income ................            93,607            50,624           178,719           120,424
   Gain on extinguishment of
     mortgage loan investment ...........                --                --         1,025,833                --
   Gain on disposition of real
     estate .............................                --         1,962,280                --         1,962,280
                                                 ----------        ----------        ----------        ----------
     Total revenue ......................           456,665         2,416,915         2,461,484         3,305,320
                                                 ----------        ----------        ----------        ----------

Expenses:
   Interest .............................            60,677            61,553           182,975           185,528
   Depreciation .........................            57,626            33,287           176,863           178,311
   Property taxes .......................            41,046            39,406           118,984           128,645
   Personnel costs ......................            37,242            38,539           111,316           116,001
   Utilities ............................            23,175            22,647            63,350            62,286
   Repairs and maintenance ..............            30,005            33,783            87,283           103,091
   Property management
     fees - affiliates ..................            15,944            14,944            45,976            47,767
   Other property operating
     expenses ...........................            20,835            26,610            57,127            72,884
   General and administrative ...........            39,384            25,749           202,584            82,213
   General and administrative -
     affiliates .........................            30,412            73,197           161,538           205,132
                                                 ----------        ----------        ----------        ----------
     Total expenses .....................           356,346           369,715         1,207,996         1,181,858
                                                 ----------        ----------        ----------        ----------

Net income ..............................        $  100,319        $2,047,200        $1,253,488        $2,123,462
                                                 ==========        ==========        ==========        ==========

Net income allocable
   to limited partners ..................        $   99,316        $2,026,728        $1,240,953        $2,102,227
Net income allocable
   to General Partner ...................             1,003            20,472            12,535            21,235
                                                 ----------        ----------        ----------        ----------
Net income ..............................        $  100,319        $2,047,200        $1,253,488        $2,123,462
                                                 ==========        ==========        ==========        ==========

Net income per limited
   partnership unit .....................        $     2.00        $    40.94        $    25.06        $    42.46
                                                 ==========        ==========        ==========        ==========

Distributions per limited
   partnership unit .....................        $   116.14        $    50.49        $   146.08        $    65.64
                                                 ==========        ==========        ==========        ==========
</TABLE>


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

                 See accompanying notes to financial statements.
<PAGE>

                        MCNEIL REAL ESTATE FUND XX, L.P.

                    STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
                                   (Unaudited)

              For the Nine Months Ended September 30, 1998 and 1997


<TABLE>
<CAPTION>
                                                                                              Total
                                                   General               Limited             Partners'
                                                   Partner              Partners          Equity (Deficit)
                                                 -------------        ------------        ----------------
<S>                                              <C>                  <C>                  <C>         
Balance at December 31, 1996 ............        $   (318,863)        $ 10,315,277         $  9,996,414

Net income ..............................              21,235            2,102,227            2,123,462

Distributions to limited partners........                  --           (3,249,987)          (3,249,987)
                                                 ------------         ------------         ------------

Balance at September 30, 1997 ...........        $   (297,628)        $  9,167,517         $  8,869,889
                                                 ============         ============         ============



Balance at December 31, 1997 ............        $   (296,465)        $  9,282,684         $  8,986,219

Net income ..............................              12,535            1,240,953            1,253,488

Distributions to limited partners .......                  --           (7,232,590)          (7,232,590)
                                                 ------------         ------------         ------------

Balance at September 30, 1998 ...........        $   (283,930)        $  3,291,047         $  3,007,117
                                                 ============         ============         ============
</TABLE>





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

                 See accompanying notes to financial statements.
<PAGE>
                        MCNEIL REAL ESTATE FUND XX, L.P.

                            STATEMENTS OF CASH FLOWS
                                   (Unaudited)

                Increase (Decrease) in Cash and Cash Equivalents

<TABLE>
<CAPTION>
                                                                      Nine Months Ended
                                                                         September 30,
                                                              --------------------------------
                                                                  1998                 1997
                                                              ------------        ------------

Cash flows from operating activities:
<S>                                                           <C>                 <C>        
   Cash received from tenants ........................        $ 1,006,444         $   973,198
   Cash paid to suppliers ............................           (539,235)           (485,988)
   Cash paid to affiliates ...........................            (91,780)           (272,644)
   Interest received .................................            375,076             325,966
   Interest received from affiliate ..................            184,958              36,665
   Interest paid .....................................           (165,000)           (168,562)
   Property taxes paid ...............................               (280)            (24,100)
   Property taxes escrowed ...........................           (115,800)            (97,044)
                                                              -----------         -----------
Net cash provided by operating activities ............            654,383             287,491
                                                              -----------         -----------

Cash flows from investing activities:
   Additions to real estate investments ..............            (47,877)           (157,761)
   Collection of principal on mortgage loan
     investments .....................................             53,364             101,584
   Proceeds from payoff of mortgage loan
     investments .....................................          4,241,181                  --
   Collection of principal on mortgage loan
     investments - affiliate .........................              9,126                  --
   Proceeds from payoff of mortgage loan
     investments - affiliate .........................          3,570,896                  --
   Proceeds from disposition of real estate ..........                 --           4,493,834
                                                              -----------         -----------
Net cash provided by investing activities ............          7,826,690           4,437,657
                                                              -----------         -----------

Cash flows from financing activities:
   Principal payments on mortgage note payable........            (46,017)            (42,427)
   Distributions to limited partners .................         (7,232,590)         (3,249,987)
                                                              -----------         -----------
Net cash used in financing activities ................         (7,278,607)         (3,292,414)
                                                              -----------         -----------

Net increase in cash and cash  equivalents ...........          1,202,466           1,432,734

Cash and cash equivalents at beginning of
   period ............................................          1,824,293           3,188,257
                                                              -----------         -----------

Cash and cash equivalents at end of period ...........        $ 3,026,759         $ 4,620,991
                                                              ===========         ===========
</TABLE>


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

                 See accompanying notes to financial statements.
<PAGE>
                        MCNEIL REAL ESTATE FUND XX, L.P.

                            STATEMENTS OF CASH FLOWS
                                   (Unaudited)

              Reconciliation of Net Income to Net Cash Provided by
                              Operating Activities

<TABLE>
<CAPTION>
                                                                    Nine Months Ended
                                                                       September 30,
                                                               -------------------------------

                                                                  1998                1997
                                                               -----------         -----------

<S>                                                            <C>                 <C>        
Net income ............................................        $ 1,253,488         $ 2,123,462
                                                               -----------         -----------

Adjustments to reconcile net income to net cash
   provided  by  operating activities:
   Depreciation .......................................            176,863             178,311
   Amortization of deferred borrowing costs ...........             11,949              11,210
   Amortization of discount on mortgage note
     payable ..........................................              6,366               6,044
   Gain on extinguishment of mortgage
     loan investment ..................................         (1,025,833)                 --
   Gain on disposition of real estate .................                 --          (1,962,280)
   Disposition fee payable to affiliate ...............                 --            (124,500)
   Changes in assets and liabilities:
     Cash segregated for security deposits ............              1,914              24,729
     Interest and other accounts receivable ...........            134,062             (14,365)
     Escrow deposits ..................................             24,207              33,261
     Prepaid expenses and other assets ................                 --                 834
     Accounts payable and other accrued
       expenses .......................................            (18,694)            (46,616)
     Accrued property taxes ...........................            (18,065)            (26,412)
     Payable to affiliates ............................            115,734             104,755
     Deferred revenue .................................             (7,175)             (4,968)
     Security deposits and deferred rental
       revenue ........................................               (433)            (15,974)
                                                               -----------         -----------

       Total adjustments ..............................           (599,105)         (1,835,971)
                                                               -----------         -----------

Net cash provided by operating activities .............        $   654,383         $   287,491
                                                               ===========         ===========
</TABLE>




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

                 See accompanying notes to financial statements.
<PAGE>


                        MCNEIL REAL ESTATE FUND XX, L.P.

                          Notes to Financial Statements
                               September 30, 1998
                                   (Unaudited)

NOTE 1.
-------

McNeil  Real  Estate  Fund  XX,  L.P.  (the  "Partnership"),  formerly  known as
Southmark  Income  Investors,  Ltd., was organized on July 19, 1984 as a limited
partnership  under the  provisions of the  California  Revised  Uniform  Limited
Partnership Act. The general partner of the Partnership is McNeil Partners, L.P.
(the "General Partner"), a Delaware limited partnership,  an affiliate of Robert
A. McNeil  ("McNeil").  The principal  place of business for the Partnership and
the General Partner is 13760 Noel Road, Suite 600, Dallas, Texas 75240.

In the opinion of management,  the financial  statements reflect all adjustments
necessary for a fair  presentation of the Partnership's  financial  position and
results  of  operations.  All  adjustments  were of a normal  recurring  nature.
However,  the results of operations for the nine months ended September 30, 1998
are not necessarily indicative of the results to be expected for the year ending
December 31, 1998.

NOTE 2.
-------

The  financial  statements  should  be read in  conjunction  with the  financial
statements  contained in the  Partnership's  Annual  Report on Form 10-K for the
year  ended  December  31,  1997,  and the  notes  thereto,  as  filed  with the
Securities and Exchange  Commission,  which is available upon request by writing
to McNeil Real Estate Fund XX, L.P.,  c/o McNeil Real Estate  Management,  Inc.,
Investor Services, 13760 Noel Road, Suite 600, LB70, Dallas, Texas 75240.

NOTE 3.
-------

The  Partnership  pays property  management fees equal to 5% of the gross rental
receipts for its properties to McNeil Real Estate Management,  Inc.  ("McREMI"),
an affiliate of the General Partner, for providing property management services.

Under the terms of its partnership agreement, the Partnership pays a disposition
fee to an  affiliate  of the General  Partner  equal up to 3% of the gross sales
price  for  brokerage  services  performed  in  connection  with the sale of the
Partnership's  properties,  provided,  however,  that in no event shall all real
estate  commissions  (including the disposition  fee) paid to all persons exceed
the amount customarily charged in similar arms-length  transactions.  The fee is
due and payable at the time the sale closes.  The Partnership  incurred $124,500
of such  fees  during  1997  in  connection  with  the  sale of 1130  Sacramento
Condominiums.  This amount represents 2.65% of the gross sales price. These fees
have not yet  been  paid by the  Partnership  and are  included  in  payable  to
affiliates on the Balance Sheets at September 30, 1998 and December 31, 1997.

The  Partnership  reimburses  McREMI  for  its  costs,  including  overhead,  of
administering the Partnership's affairs.


<PAGE>
The  Partnership  is paying an asset  management  fee  which is  payable  to the
General  Partner.  Through 1999, the asset management fee is calculated as 1% of
the  Partnership's  tangible asset value.  Tangible asset value is determined by
using the greater of (i) an amount calculated by applying a capitalization  rate
of 9% to the annualized net operating  income of each property,  (ii) a value of
$10,000 per apartment  unit or (iii) on 1130  Sacramento,  the net book value of
the  property  is used to arrive  at the  property  tangible  asset  value.  The
property  tangible  asset  value is then  added to the book  value of all  other
assets excluding  intangible items. The fee percentage  decreases  subsequent to
1999.  Total  accrued but unpaid asset  management  fees of $116,983 and $36,633
were outstanding at September 30, 1998 and December 31, 1997, respectively.


Compensation  and  reimbursements  paid to or  accrued  for the  benefit  of the
General Partner and its affiliates are as follows:

                                                              Nine Months Ended
                                                                 September 30,
                                                           ---------------------
                                                              1998        1997
                                                           --------     --------

Property management fees ..........................        $ 45,976     $ 47,767
Charged to gain on disposition of real estate:
   Disposition fees ...............................              --      124,500
Charged to general and administrative -
   affiliates:
   Partnership administration .....................          81,188       83,087
   Asset management fee ...........................          80,350      122,045
                                                           --------     --------
                                                           $207,514     $377,399
                                                           ========     ========

Payable to  affiliates  at September  30, 1998 and  December 31, 1997  consisted
primarily of unpaid property  management  fees,  disposition  fees,  Partnership
general and  administrative  expenses and asset  management fees and are due and
payable from current operations.

NOTE 4.
-------

The  Partnership's  mortgage loan  investments - affiliate were secured by first
and second  liens on Fort Meigs  Plaza  Shopping  Center,  which was owned by an
affiliate of the General  Partner.  On April 20, 1998, Fort Meigs Plaza was sold
to a  non-affiliate  for a gross sales price of $3.8  million.  The  Partnership
received  $3,615,353  as  payment  in  full  for  both  principal  and  interest
receivable on the loans,  which  represents the available cash proceeds from the
sale of the property.


<PAGE>
NOTE 5.
-------

The  mortgage  loan  investment  secured by  Idlewood  Nursing  Home  matured in
February  1998. On May 1, 1998, the  Partnership  received $2.4 million from the
borrower as payment in full for both  principal  and interest  receivable on the
loan (the actual balance of the loan was greater than the book value). Since the
Partnership  owned an 83%  participation  interest in the note,  $408,000 of the
$2.4 million  settlement was paid to the owner of the remaining 17% of the note.
As a result of this transaction, the Partnership recognized a $1,025,833 gain on
extinguishment  of  mortgage  loan  investment,  which  represents  the net cash
received in excess of the book value of the loan.

NOTE 6.
-------

On August 20, 1998, the Partnership  received  $2,541,572 as payment in full for
both principal and interest  receivable on the mortgage loan investment  secured
by  Lakeland  Nursing  Home.  Since the  Partnership  owned a 90%  participation
interest  in the  note,  $254,157  of the  payoff  was paid to the  owner of the
remaining 10% of the note.

NOTE 7.
-------

On August 1, 1997,  the  Partnership  sold one of four units of 1130  Sacramento
Condominiums,   located  in  San  Francisco,   California,  to  an  unaffiliated
purchaser.  The remaining  three units were sold to the same purchaser on August
28,  1997.  The cash  purchase  price for all four  units was  $4,700,000.  Cash
proceeds and the gain on disposition of real estate are detailed below:

                                                    Gain on Sale   Cash Proceeds
                                                    ------------   -------------

     Cash sales price.........................      $ 4,700,000     $ 4,700,000
     Selling costs............................         (330,666)       (206,166)
                                                                    -----------

     Net cash proceeds........................                      $ 4,493,834
                                                                    ===========

     Carrying value...........................       (2,407,054)
                                                    -----------

     Gain on disposition of real estate.......      $ 1,962,280
                                                    ===========

As  discussed in Note 3, the  Partnership  incurred a $124,500  disposition  fee
payable to an affiliate of the General  Partner in  connection  with the sale of
1130 Sacramento.  This fee reduced the amount of the gain on disposition of real
estate and is included in selling costs above.  However,  as the fee has not yet
been paid, it did not reduce the amount of net cash proceeds from the sale.  The
net cash proceeds  from the sale of 1130  Sacramento  will be  $4,369,334  after
payment of the disposition fee.





<PAGE>
NOTE 8.
-------

James F.  Schofield,  Gerald C. Gillett,  Donna S. Gillett,  Jeffrey  Homburger,
Elizabeth Jung,  Robert Lewis, and Warren Heller et al. v. McNeil Partners L.P.,
McNeil Investors,  Inc., McNeil Real Estate Management,  Inc., Robert A. McNeil,
Carole J. McNeil,  McNeil Pacific  Investors Fund 1972, Ltd., McNeil Real Estate
Fund IX,  Ltd.,  McNeil Real  Estate  Fund X, Ltd.,  McNeil Real Estate Fund XI,
Ltd.,  McNeil  Real Estate Fund XII,  Ltd.,  McNeil Real Estate Fund XIV,  Ltd.,
McNeil Real Estate Fund XV, Ltd.,  McNeil Real Estate Fund XX, L.P., McNeil Real
Estate Fund XXI, L.P.,  McNeil Real Estate Fund XXII,  L.P.,  McNeil Real Estate
Fund XXIV,  L.P.,  McNeil Real Estate  Fund XXV,  L.P.,  McNeil Real Estate Fund
XXVI, L.P., and McNeil Real Estate Fund XXVII,  L.P., et al. - Superior Court of
the State of California for the County of Los Angeles,  Case No. BC133799 (Class
and Derivative Action Complaint).

The action involves  purported  class and derivative  actions brought by limited
partners of each of the fourteen limited partnerships that were named as nominal
defendants as listed above (the  "Partnerships").  Plaintiffs allege that McNeil
Investors, Inc., its affiliate McNeil Real Estate Management,  Inc. and three of
their senior officers and/or directors (collectively, the "Defendants") breached
their  fiduciary  duties and certain  obligations  under the respective  Amended
Partnership  Agreement.  Plaintiffs  allege that  Defendants  have rendered such
Units highly illiquid and  artificially  depressed the prices that are available
for Units on the resale market.  Plaintiffs also allege that Defendants  engaged
in a course of conduct to prevent the  acquisition  of Units by an  affiliate of
Carl  Icahn  by  disseminating  purportedly  false,  misleading  and  inadequate
information.  Plaintiffs  further allege that Defendants  acted to advance their
own personal  interests at the expense of the Partnerships'  public unit holders
by failing to sell Partnership  properties and failing to make  distributions to
unitholders.

On December 16, 1996, the Plaintiffs filed a consolidated and amended complaint.
Plaintiffs  are suing for breach of  fiduciary  duty,  breach of contract and an
accounting,  alleging,  among other things, that the management fees paid to the
McNeil affiliates over the last six years are excessive,  that these fees should
be reduced retroactively and that the respective Amended Partnership  Agreements
governing the Partnerships are invalid.

Defendants  filed a demurrer to the  consolidated  and amended  complaint  and a
motion to strike on February 14, 1997,  seeking to dismiss the  consolidated and
amended complaint in all respects.  A hearing on Defendant's demurrer and motion
to strike  was held on May 5,  1997.  The Court  granted  Defendants'  demurrer,
dismissing  the  consolidated  and  amended  complaint  with leave to amend.  On
October  31,  1997,  the  Plaintiffs  filed a second  consolidated  and  amended
complaint. The case was stayed pending settlement discussions.  A Stipulation of
Settlement dated September 15, 1998 has been signed by the parties.  Preliminary
Court  approval  was  received  on  October 6,  1998.  A hearing on final  Court
approval is scheduled for December 17, 1998.

Plaintiff's  counsel  intend  to seek an  order  awarding  attorney's  fees  and
reimbursements  of their  out-of-pocket  expenses.  The  amount of such award is
undeterminable  until  final  approval  is  received  from the  court.  Fees and
expenses shall be allocated amongst the Partnerships on a pro rata basis,  based
upon  tangible  asset value of each such  partnership,  less total  liabilities,
calculated in accordance with the Amended Partnership Agreements for the quarter
most recently ended.


<PAGE>
ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
-------  ---------------------------------------------------------------
         RESULTS OF OPERATIONS
         ---------------------

FINANCIAL CONDITION
-------------------

There has been no  significant  change in the  operations  of  Sterling  Springs
Apartments.   1130  Sacramento   Condominiums  was  sold  in  August  1997.  The
Partnership's  mortgage loan investments - affiliate secured by Fort Meigs Plaza
were  repaid in April 1998.  The  Partnerships  two  mortgage  loan  investments
secured by Idlewood  Nursing Home and  Lakeland  Nursing Home were repaid in May
1998 and August 1998, respectively.

The  Partnership  reported net income of $1,253,488 for the first nine months of
1998 as compared  to  $2,123,462  for the same period in 1997.  Revenues in 1998
decreased to $2,461,484 from $3,305,320 in 1997,  while expenses were $1,207,996
in 1998 as compared to $1,181,858 in 1997.

Net cash provided by operating activities was $654,383 for the nine months ended
September 30, 1998. The Partnership  expended $47,877 for capital  improvements,
made $46,017 in principal  payments on its mortgage note payable and distributed
$7,232,590  to the limited  partners.  After  receiving a total of $7,874,567 in
principal  on  mortgage  loan   investments  and  mortgage  loan  investments  -
affiliate, cash and cash equivalents totaled $3,026,759 at September 30, 1998, a
net increase of $1,202,466 from the balance at December 31, 1997.

RESULTS OF OPERATIONS

Revenue:

Total revenue decreased by $1,960,250 and $843,836 for the three and nine months
ended September 30, 1998, respectively, as compared to the same periods in 1997.
The decrease was mainly due to a gain on disposition  of real estate  recognized
in  1997,  partially  offset  by a  gain  on  extinguishment  of  mortgage  loan
investment in 1998, as discussed below.

Interest income on mortgage loan investments for the three and nine months ended
September 30, 1998 decreased by $37,973 and $29,445,  respectively,  in relation
to the comparable  periods in 1997. The decrease was due to the Lakeland Nursing
Home  mortgage  loan  investment  being paid off by the borrower in August 1998.
Although the Idlewood Nursing Home mortgage loan investment was also paid off in
1998, no interest was accrued on this loan in 1998 or 1997.

In 1993, the  Partnership  acquired a second lien loan on a property owned by an
affiliate.  The  Partnership  purchased  the first lien loan on this property in
December 1997.  Both loans were repaid by the affiliate  borrower in April 1998.
Interest  income on mortgage loan  investments - affiliate  decreased by $15,473
and increased by $62,299 for the three and nine months ended September 30, 1998,
respectively,  as compared to the same periods in 1997. The overall increase was
due to the first nine months of 1997 including  interest on the second lien loan
only.  1998  includes  interest  on both the first and second  lien  loans.  The
decrease  for the  quarter  was due to both of the loans  being  repaid in April
1998.




<PAGE>
Other  interest  income  increased by $42,983 and $58,295 for the three and nine
months ended September 30, 1998,  respectively,  as compared to the same periods
in 1997.  The  increase  was the result of an  increase  in cash  available  for
short-term  investment  due  to  payoff  of  the  Partnership's   mortgage  loan
investments  and mortgage  loan  investments  - affiliate  during the second and
third quarters of 1998.

In the second quarter of 1998, the  Partnership  recognized a $1,025,833 gain on
extinguishment of mortgage loan investment related to the payoff of the Idlewood
Nursing Home loan. The gain represents the cash payoff received in excess of the
book value of the mortgage loan investment.

On August 1, 1997,  the  Partnership  sold one of four units of 1130  Sacramento
Condominiums to an unaffiliated  purchaser.  The remaining three units were sold
to the same  purchaser on August 28, 1997.  The cash purchase price for all four
units was $4,700,000.  The Partnership  recognized a gain on disposition of real
estate of $1,962,280 as more fully discussed in Item 1, Note 7.

Expenses:

Total  expenses  for the three  months  decreased  by $13,369 and  increased  by
$26,138 for the nine  months  ended  September  30, 1998 as compared to the same
periods in 1997.  The  increase  was mainly due to an  increase  in general  and
administrative   expenses,   partially   offset  by  decreases  in  repairs  and
maintenance,  other property operating expenses and general and administrative -
affiliates, as discussed below.

Repairs and  maintenance  expense  decreased by $3,778 and $15,808 for the three
and nine months ended September 30, 1998, respectively,  as compared to the same
periods  in  1997.  The  overall  decrease  was  mainly   attributable  to  1130
Sacramento, which was sold in August 1997.

In the three and nine months ended September 30, 1998, other property  operating
expenses decreased by $5,775 and $15,757,  respectively, as compared to the same
periods in 1997. The decrease was mainly due to a $10,000 deductible paid by the
Partnership  in 1997 for two minor tenant  claims  settled by the  Partnership's
insurance  carrier.  The remaining decrease was attributable to 1130 Sacramento,
which was sold in August 1997.

General and  administrative  expenses  increased by $13,635 and $120,371 for the
three and nine months ended September 30, 1998, respectively, in relation to the
same periods in 1997.  The increase was mainly due to costs  incurred to explore
alternatives to maximize the value of the Partnership (see Liquidity and Capital
Resources).

General  and  administrative  expenses -  affiliates  decreased  by $42,785  and
$43,594 for the three and nine months ended September 30, 1998, respectively, in
relation to the same  periods in 1997.  The decrease was due to a decline in the
tangible asset value of the Partnership, on which the fees are based, due to the
payoff  of  the  Partnership's  mortgage  loan  investments  and  mortgage  loan
investments - affiliate in 1998.








<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

The Partnership  generated $654,383 of cash through operating activities for the
first nine months of 1998 as compared  to  $287,491  generated  during the first
nine months of 1997.  The increase in 1998 was  partially  due to an increase in
interest  received from an affiliate  relating to the Fort Meigs Plaza loan (see
discussion  of increase  in  interest  income on  mortgage  loan  investments  -
affiliate,  above). In addition, there was a decrease in cash paid to affiliates
in 1998.

The Partnership  expended  $47,877 and $157,761 for additions to its real estate
investments in the nine months ended September 30, 1998 and 1997,  respectively.
Approximately  $30,000  of  the  decrease  in  1998  was  attributable  to  1130
Sacramento,  which was sold in August  1997.  In  addition,  there was a greater
amount spent in 1997 for  exterior  carpentry  and painting at Sterling  Springs
Apartments.

In the first nine months of 1998 and 1997, the Partnership collected $53,364 and
$101,584,  respectively, of principal in mortgage loan investments. The decrease
in 1998 was due to the payoff of the Idlewood  Nursing Home loan in May 1998 and
the Lakeland Nursing Home loan in August 1998.

In May 1998, the Partnership  received a net total of $4,241,181 as repayment in
full of the Partnership's mortgage loan investments.  $1,992,000 was received in
May 1998 to payoff the Idlewood Nursing Home loan and $2,249,181 was received in
August 1998 to payoff the Lakeland Nursing Home loan.

In April 1998,  the  Partnership  received  $3,570,896  to payoff the  principal
balance of the Fort Meigs Plaza mortgage loan investments - affiliate.

The  Partnership  received  net  proceeds  from the sale of 1130  Sacramento  of
$4,493,834 in August 1997.

The Partnership  distributed  $7,232,590 and $3,249,987 to the limited  partners
during the nine months ended September 30, 1998 and 1997, respectively.

Short-term liquidity:

At  September  30,  1998,  the  Partnership  held cash and cash  equivalents  of
$3,026,759.  This balance provides a reasonable level of working capital for the
Partnership's immediate needs in operating its remaining property.

In 1998, the operation of Sterling Springs  Apartments,  the Partnership's  only
remaining  property,  is expected to provide  sufficient  positive cash flow for
normal  operations.  Management  will perform routine repairs and maintenance on
the  property to  preserve  and  enhance  its value and  competitiveness  in the
market.  Capital improvements to the Partnership's property in 1998 are expected
to be funded from operations of the property.

The  mortgage  loan  investment  secured by  Idlewood  Nursing  Home  matured in
February  1998. On May 1, 1998, the  Partnership  received $2.4 million from the
borrower as payment in full for both  principal  and interest  receivable on the
loan (the actual balance of the loan was greater than the book value). Since the
Partnership  owned an 83%  participation  interest in the note,  $408,000 of the
$2.4 million settlement was paid to the owner of the remaining 17% of the note.



<PAGE>
On August 20, 1998, the Partnership  received  $2,541,572 as payment in full for
both principal and interest  receivable on the mortgage loan investment  secured
by  Lakeland  Nursing  Home.  Since the  Partnership  owned a 90%  participation
interest  in the  note,  $254,157  of the  payoff  was paid to the  owner of the
remaining 10% of the note.

The first and second lien mortgage loan investments - affiliate  secured by Fort
Meigs  Plaza  matured  in  March  1998 and  September  1997,  respectively.  The
borrowing  partnership  sold the property to a  non-affiliate  in April 1998 for
$3.8 million.  The Partnership  received  $3,615,353 as payment in full for both
principal and interest receivable on the loans.

For 1998,  management  expects that cash from operations of its property,  along
with the  present  balance  of cash and cash  equivalents  held,  will allow the
Partnership to meet its obligations as they come due.

Long-term liquidity:

The  Partnership's  property,  Sterling Springs  Apartments,  is encumbered with
mortgage debt. The mortgage is not due until 2003.

While the outlook for  maintenance of adequate levels of liquidity is favorable,
should  operations  deteriorate and present cash resources be  insufficient  for
current needs,  the Partnership  would require other sources of working capital.
No such sources have been identified.  The Partnership has no established  lines
of  credit  from  outside  sources.  Other  possible  actions  to  resolve  cash
deficiencies  include  refinancings,  deferral  of capital  expenditures  on the
Partnership's  property except where  improvements  are expected to increase the
competitiveness  and  marketability  of the property,  arranging  financing from
affiliates or the ultimate sale of the property.

As previously announced, the Partnership has retained PaineWebber,  Incorporated
("PaineWebber")  as its exclusive  financial advisor to explore  alternatives to
maximize  the  value  of  the  Partnership  including,   without  limitation,  a
transaction  in which  limited  partnership  interests  in the  Partnership  are
converted  into  cash.  The  Partnership,   through  PaineWebber,  has  provided
financial  and  other  information  to  interested   parties  and  is  currently
conducting  discussions  with one such party in an attempt to reach a definitive
agreement  with respect to a sale  transaction.  It is possible that the General
Partner  and its  affiliates  will  receive  non-cash  consideration  for  their
ownership  interests in connection  with any such  transaction.  There can be no
assurance that any such agreement will be reached nor the terms thereof.

Forward-Looking Information:

Within this document,  certain  statements are made as to the expected occupancy
trends,  financial  condition,  results  of  operations,  and cash  flows of the
Partnership  for periods after  September 30, 1998. All of these  statements are
forward-looking  statements  made pursuant to the safe harbor  provisions of the
Private  Securities  Litigation  Reform Act of 1995.  These  statements  are not
historical  and  involve  risks  and  uncertainties.  The  Partnership's  actual
occupancy trends, financial condition, results of operations, and cash flows for
future  periods may differ  materially  due to several  factors.  These  factors
include,  but are not limited to, the  Partnership's  ability to control  costs,
make necessary  capital  improvements,  negotiate the sale or refinancing of its
property,  collect  payments  on its  mortgage  loan  investment  and respond to
changing economic and competitive factors.


<PAGE>
Other Information:

Management has reviewed its information  technology  infrastructure  to identify
any  systems  that could be  affected  by the year 2000  problem.  The year 2000
problem is the result of computer programs being written using two digits rather
than four to define the applicable  year. Any programs that have  time-sensitive
software  may  recognize a date using "00" as the year 1900 rather than the year
2000.  This  could  result in major  systems  failure  or  miscalculations.  The
information  systems  used  by  the  Partnership  for  financial  reporting  and
significant  accounting  functions were made year 2000  compliant  during recent
systems conversions.

Management  is  in  the  process  of  evaluating  the  mechanical  and  embedded
technological systems at the various properties. Management intends to inventory
all such systems and query  suppliers,  vendors and  manufacturers  to determine
year 2000 compliance.  In circumstances of  non-compliance  management will work
with the vendor to remedy the problem or seek alternative  suppliers who will be
in compliance.  Management believes that the remediation of any outstanding year
2000  conversion  issues  will not have a  material  or  adverse  effect  on the
Partnership's operations.  However, no estimates can be made as to the potential
adverse impact  resulting from the failure of third party service  providers and
vendors to be year 2000  compliant.  Management is in the process of identifying
those risks as well as  developing  a  contingency  plan to  mitigate  potential
adverse effects from non-compliance.


                           PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS
------- -----------------

James F.  Schofield,  Gerald C. Gillett,  Donna S. Gillett,  Jeffrey  Homburger,
Elizabeth Jung,  Robert Lewis, and Warren Heller et al. v. McNeil Partners L.P.,
McNeil Investors,  Inc., McNeil Real Estate Management,  Inc., Robert A. McNeil,
Carole J. McNeil,  McNeil Pacific  Investors Fund 1972, Ltd., McNeil Real Estate
Fund IX,  Ltd.,  McNeil Real  Estate  Fund X, Ltd.,  McNeil Real Estate Fund XI,
Ltd.,  McNeil  Real Estate Fund XII,  Ltd.,  McNeil Real Estate Fund XIV,  Ltd.,
McNeil Real Estate Fund XV, Ltd.,  McNeil Real Estate Fund XX, L.P., McNeil Real
Estate Fund XXI, L.P.,  McNeil Real Estate Fund XXII,  L.P.,  McNeil Real Estate
Fund XXIV,  L.P.,  McNeil Real Estate  Fund XXV,  L.P.,  McNeil Real Estate Fund
XXVI, L.P., and McNeil Real Estate Fund XXVII,  L.P., et al. - Superior Court of
the State of California for the County of Los Angeles,  Case No. BC133799 (Class
and Derivative Action Complaint).

The action involves  purported  class and derivative  actions brought by limited
partners of each of the fourteen limited partnerships that were named as nominal
defendants as listed above (the  "Partnerships").  Plaintiffs allege that McNeil
Investors, Inc., its affiliate McNeil Real Estate Management,  Inc. and three of
their senior officers and/or directors (collectively, the "Defendants") breached
their  fiduciary  duties and certain  obligations  under the respective  Amended
Partnership  Agreement.  Plaintiffs  allege that  Defendants  have rendered such
Units highly illiquid and  artificially  depressed the prices that are available
for Units on the resale market.  Plaintiffs also allege that Defendants  engaged
in a course of conduct to prevent the  acquisition  of Units by an  affiliate of
Carl  Icahn  by  disseminating  purportedly  false,  misleading  and  inadequate
information.  Plaintiffs  further allege that Defendants  acted to advance their
own personal  interests at the expense of the Partnerships'  public unit holders
by failing to sell Partnership  properties and failing to make  distributions to
unitholders.
<PAGE>
On December 16, 1996, the Plaintiffs filed a consolidated and amended complaint.
Plaintiffs  are suing for breach of  fiduciary  duty,  breach of contract and an
accounting,  alleging,  among other things, that the management fees paid to the
McNeil affiliates over the last six years are excessive,  that these fees should
be reduced retroactively and that the respective Amended Partnership  Agreements
governing the Partnerships are invalid.

Defendants  filed a demurrer to the  consolidated  and amended  complaint  and a
motion to strike on February 14, 1997,  seeking to dismiss the  consolidated and
amended complaint in all respects.  A hearing on Defendant's demurrer and motion
to strike  was held on May 5,  1997.  The Court  granted  Defendants'  demurrer,
dismissing  the  consolidated  and  amended  complaint  with leave to amend.  On
October  31,  1997,  the  Plaintiffs  filed a second  consolidated  and  amended
complaint. The case was stayed pending settlement discussions.  A Stipulation of
Settlement dated September 15, 1998 has been signed by the parties.  Preliminary
Court  approval  was  received  on  October 6,  1998.  A hearing on final  Court
approval is scheduled for December 17, 1998.

Plaintiff's  counsel  intend  to seek an  order  awarding  attorney's  fees  and
reimbursements  of their  out-of-pocket  expenses.  The  amount of such award is
undeterminable  until  final  approval  is  received  from the  court.  Fees and
expenses shall be allocated amongst the Partnerships on a pro rata basis,  based
upon  tangible  asset value of each such  partnership,  less total  liabilities,
calculated in accordance with the Amended Partnership Agreements for the quarter
most recently ended.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K
-------  --------------------------------

(a)      Exhibits.

         Exhibit
         Number                     Document Description
         -------                    --------------------

         4.                         Amended and  Restated  Limited   Partnership
                                    Agreement      dated      March 30,    1992.
                                    (Incorporated  by reference to  the  Current
                                    Report   of   the   registrant on   Form 8-K
                                    dated March 30, 1992, as filed on April  10,
                                    1992).

         11.                        Statement   regarding   computation  of  Net
                                    Income per  Limited  Partnership  Unit:  Net
                                    income  per  limited   partnership  unit  is
                                    computed by dividing net income allocated to
                                    the limited partners by the weighted average
                                    number   of   limited    partnership   units
                                    outstanding.  Per unit  information has been
                                    computed based on 49,512 limited partnership
                                    units outstanding in 1998 and 1997.

         27.                        Financial   Data   Schedule  for the quarter
                                    ended September 30, 1998.

(b)      Reports on Form 8-K. A Form 8-K with respect to Item 2 dated August 20,
         1998 was filed on August 25, 1998  regarding the payoff of the Lakeland
         Nursing Home mortgage loan investment.



<PAGE>
                        MCNEIL REAL ESTATE FUND XX, L.P.

                                   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:



                             McNEIL REAL ESTATE FUND XX, L.P.

                             By:  McNeil Partners, L.P., General Partner

                                  By: McNeil Investors, Inc., General Partner


November 16, 1998                 By: /s/  Ron K. Taylor
-----------------                    -------------------------------------------
Date                                  Ron K. Taylor
                                      President and Director of McNeil 
                                       Investors, Inc.
                                      (Principal Financial Officer)




November 16, 1998                 By: /s/  Carol A. Fahs
-----------------                    -------------------------------------------
Date                                  Carol A. Fahs
                                      Vice President of McNeil Investors, Inc.
                                      (Principal Accounting Officer)