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

                                   FORM 10-K

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

                  For The Fiscal Year Ended December 31, 1998

                                      or

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

                           Commission file #0-18431

                      Inland Land Appreciation Fund, L.P.
            (Exact name of registrant as specified in its charter)

       Delaware                                   36-3544798
(State of organization)            (I.R.S. Employer Identification Number)

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

       Registrant's telephone number, including area code:  630-218-8000

          Securities registered pursuant to Section 12(b) of the Act:

Title of each class:          Name of each exchange on which registered:
       None                                      None

       Securities registered pursuant to Section 12(g) of the Act:
                           LIMITED PARTNERSHIP UNITS
                               (Title of class)

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

Indicate by check mark if disclosure  of delinquent filers pursuant to Item 405
of Regulation S-K is not contained  herein,  and  will not be contained, to the
best of registrant's knowledge,  in  definitive proxy or information statements
incorporated by reference in Part  III  of  this  Form 10-K or any amendment to
this Form 10-K.[X]

State the aggregate market value of  the  voting stock held by nonaffiliates of
the registrant. Not applicable.

The Prospectus of the Registrant  dated  October  12, 1988, as supplemented and
filed pursuant to Rule 424(b) and  424(c)  under  the Securities Act of 1933 is
incorporated by reference in Parts I, II  and III of this Annual Report on Form
10-K.


                                      -1-



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


                               TABLE OF CONTENTS



                                    Part I                                 Page
                                    ------                                 ----

  Item  1. Business.......................................................  3

  Item  2. Properties.....................................................  5

  Item  3. Legal Proceedings..............................................  5

  Item  4. Submission of Matters to a Vote of Security Holders............  5


                                    Part II
                                    -------

  Item  5. Market for Partnership's Limited Partnership Units
            and Related Security Holder Matters...........................  6

  Item  6. Selected Financial Data........................................  7

  Item  7. Management's Discussion and Analysis of Financial
            Condition and Results of Operations...........................  8

  Item  8. Financial Statements and Supplementary Data.................... 13

  Item  9. Changes in and Disagreements with Independent Auditors on
            Accounting and Financial Disclosure........................... 33


                                   Part III
                                   --------
  Item 10. Directors and Executive Officers of the Registrant............. 33

  Item 11. Executive Compensation......................................... 39

  Item 12. Security Ownership of Certain Beneficial Owners and
            Management.................................................... 40

  Item 13. Certain Relationships and Related Transactions................. 40


                                    Part IV
                                    -------
  Item 14. Exhibits, Financial Statement Schedules, and Reports
            on Form 8-K................................................... 41

  SIGNATURES.............................................................. 42


                                      -2-



                                    PART I

Item 1. Business

The Registrant, Inland Land  Appreciation  Fund,  L.P. (the "Partnership"), was
formed in  October  1987,  pursuant  to  the  Delaware  Revised Uniform Limited
Partnership Act, to invest in undeveloped land on an all-cash basis and realize
appreciation of such land upon  resale.    On October 12, 1988, the Partnership
commenced an  Offering  of  10,000  (subject  to  increase  to  30,000) Limited
Partnership Units ("Units") pursuant to  a  Registration Statement on Form S-11
under the Securities Act of 1933.   The Offering terminated on October 6, 1989,
with total sales  of  30,000  Units,  at  $1,000  per  Unit, resulting in gross
offering proceeds of $30,000,000, which does not include the General Partner or
the Initial Limited Partner.    All  of  the  holders  of these Units have been
admitted to the Partnership. Inland  Real  Estate Investment Corporation is the
General Partner. The Partnership used $25,187,069 of gross offering proceeds to
purchase on an all-cash basis  twenty-five  parcels  of undeveloped land and an
option to purchase undeveloped land.    The Limited Partners of the Partnership
share in their  portion  of  benefits  of  ownership  of the Partnership's real
property investments according to the number of Units held.  As of December 31,
1998, the Partnership has repurchased a total of 394.75 Units for $350,868 from
various Limited Partners  through  the  Unit  Repurchase  Program.   Under this
program Limited  Partners  may  under  certain  circumstances  have their Units
repurchased for an amount equal to their Invested Capital.

The Partnership is engaged  in  the  business  of  real estate investment which
management considers to  be  a  single  operating  segment.   A presentation of
information about operating segments would  not be material to an understanding
of the Partnership's business taken as a whole.

The  Partnership  acquired  fee  ownership   of  the  following  real  property
investments:
                                         Gross Acres         Purchase/Sales
       Parcel & Location                Purchased/Sold            Date       
-----------------------------------  --------------------  ------------------
Parcel 1, Kendall County, Illinois          84.7360              01/19/89
                                            (3.5200         sold 12/24/96)
                                             (.3520         sold 11/25/97)
                                           (80.8640         sold 12/29/97)

Parcel 2, McHenry County, Illinois         223.4121              01/19/89
                                          (183.3759         sold 12/27/90)

Parcel 3, Kendall County, Illinois          20.0000              02/09/89
                                           (20.0000         sold 05/08/90)

Parcel 4, Kendall County, Illinois          69.2760              04/18/89
                                             (.4860         sold 02/28/91)
                                           (27.5750         sold 08/25/95)

Parcel 5, Kendall County, Illinois         372.2230 (a)          05/03/89
                                           (Option          sold 04/06/90)

(a) Included in the purchase  agreement  of  this  parcel  was a condition that
    required the Partnership to  buy  an  option  to purchase an additional 243
    acres immediately to the west of this parcel.


                                      -3-



                                         Gross Acres         Purchase/Sales
       Parcel & Location                Purchased/Sold            Date       
-----------------------------------  --------------------  ------------------
Parcel 6, Kendall County, Illinois          78.3900              06/21/89

Parcel 7, Kendall County, Illinois          77.0490              06/21/89

Parcel 8, Kendall County, Illinois           5.0000              06/21/89
                                            (5.0000         sold 10/06/89)

Parcel 9, McHenry County, Illinois          51.0300              08/07/89

Parcel 10, McHenry County, Illinois        123.9400              08/07/89
                                          (123.9400         sold 12/06/89)

Parcel 11, McHenry County, Illinois         30.5920              08/07/89

Parcel 12, Kendall County, Illinois         90.2710              10/31/89
                                             (.7090         sold 04/26/91)

Parcel 13, McHenry County, Illinois         92.7800              11/07/89
                                            (2.0810         sold 09/18/97)

Parcel 14, McHenry County, Illinois         76.2020              11/07/89

Parcel 15, Lake County, Illinois            84.5564              01/03/90
                                           (10.5300         sold Var 1996)
                                            (5.4680         sold Var 1997)
                                           (68.5584         sold Var 1998)

Parcel 16, Kane/Kendall Counties,           72.4187              01/29/90
           Illinois                        (30.9000         sold 07/10/98)

Parcel 17, McHenry County, Illinois         99.9240              01/29/90

Parcel 18, McHenry County, Illinois         71.4870              01/29/90
                                            (1.0000         sold Var 1990)
                                             (.5200         sold 03/11/93)

Parcel 19, McHenry County, Illinois         63.6915              02/23/90

Parcel 20, Kane County, Illinois           224.1480              02/28/90
                                             (.2790         sold 10/17/91)

Parcel 21, Kendall County, Illinois        172.4950              03/08/90
                                          (172.4950         sold Var 1998)

Parcel 22, McHenry County, Illinois        254.5250              04/11/90

Parcel 23, Kendall County, Illinois        140.0210              05/08/90
                                            (4.4100         sold Var 1993)
                                           (35.8800         sold Var 1994)
                                            (3.4400         sold Var 1995)




                                      -4-



                                         Gross Acres         Purchase/Sales
       Parcel & Location                Purchased/Sold            Date       
-----------------------------------  --------------------  ------------------
Parcel 24, Kendall County, Illinois        298.4830              05/23/90
                                           (12.4570         sold 05/25/90)
                                            (4.6290         sold 04/01/96)

Parcel 25, Kane County, Illinois           225.0000              06/01/90

Reference is made to Note 4  of  the  Notes  to Financial Statements (Item 8 of
this Annual  Report)  for  additional  descriptions  of  the Partnership's real
property investments.

The Partnership had  purchased  on  an  all-cash  basis, twenty-five parcels of
undeveloped land and is engaged in the  rezoning and resale of the parcels. All
of the investments were made in the Chicago metropolitan area.  The anticipated
holding period of  the  land  was  approximately  two  to  seven years from the
completion of the land portfolio  acquisitions.    As of December 31, 1998, the
Partnership has had multiple sales  transactions, through which it has disposed
of approximately 800 acres of the approximately 3,102 acres originally owned.

The General Partner anticipates  that  land  purchased  by the Partnership will
produce  sufficient  income  to   pay   property  taxes,  insurance  and  other
miscellaneous expenses.  Income will  be  derived  through leases to farmers or
from other activities compatible with  undeveloped  land.   The majority of the
parcels purchased by the  Partnership  consist  of land which generates revenue
from farming  or  other  leasing  activities.    It  is  not  expected that the
Partnership will generate cash distributions  to  investors from farm leases or
other activities.

The Partnership had no employees during 1998.

The terms of transactions between the Partnership and Affiliates of the General
Partner of the Partnership are set  forth  in  Item  11 below and Note 3 of the
Notes to Financial Statements (Item 8 of this Annual Report) to which reference
is hereby made for a description of such terms and transactions.


Item 2. Properties

The Partnership owns directly the parcels of  land referred to in Item 1 and in
Note 4 of the Notes to Financial  Statements  (Item 8 of this Annual Report) to
which reference is hereby made for a description of said parcels.


Item 3. Legal Proceedings

The Partnership is not subject to any material pending legal proceedings.


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

There were no matters submitted to a vote of security holders during 1998.




                                      -5-



                                    PART II


Item 5. Market for the Partnership's Limited Partnership Units and Related
        Security Holder Matters

As of December 31, 1998, there were  3,278 holders of Units of the Partnership.
There is no public  market  for  Units  nor  is  it anticipated that any public
market for Units will develop.

Although the Partnership has established  a  Unit Repurchase Program, funds for
repurchase of  Units  are  limited.    Reference  is  made  to "Unit Repurchase
Program" on pages 17-18 of the  Prospectus of the Partnership dated October 12,
1988, which is incorporated herein by  reference.  As of December 31, 1998, the
Partnership had approximately $46,750 available for the repurchase of Units.










































                                      -6-



Item 6. Selected Financial Data


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

       For the years ended December 31, 1998, 1997, 1996, 1995 and 1994

                 (not covered by Independent Auditors' Report)



                            1998       1997       1996       1995       1994
                            ----       ----       ----       ----       ----
Total assets........... $25,809,385 28,057,898 28,788,243 25,575,833 25,507,940
                        =========== ========== ========== ========== ==========

Total income........... $ 8,008,204  6,438,303  1,348,095  1,017,740  1,649,345
                        =========== ========== ========== ========== ==========

Net income............. $ 2,030,823    171,674    451,249    354,647    396,656
                        =========== ========== ========== ========== ==========

Net income (loss)
 allocated to the one
 General Partner Unit.. $     2,529    (1,726)      (822)       (82)        624
                        =========== ========== ========== ========== ==========
Net income allocated
  per Limited
  Partnership Unit (b). $     68.47       5.85      15.20      11.90      13.27
                        =========== ========== ========== ========== ==========

Distributions per
  Limited Partnership
  Unit from sales
  (b)(c)............... $    115.68      62.41       -         12.36      45.89
                        =========== ========== ========== ========== ==========

Weighted average Limited
  Partnership Units....   29,621.04  29,639.10  29,738.54  29,802.51  29,843.92
                        =========== ========== ========== ========== ==========

(a)  The above selected financial data  should  be read in conjunction with the
     financial statements and related notes  appearing elsewhere in this Annual
     Report.

(b)  The net income per Unit and distributions  per Unit data is based upon the
     weighted average number of Units outstanding.

(c)  Distributions from  sales  represent  a  return  of  Invested  Capital, as
     defined in the Partnership Agreement.

(d)  Reference is made to Note 4  of  the Notes to Financial Statements (Item 8
     of this  Annual  Report)  for  a  description  of  the  Partnership's land
     acquisitions and dispositions.


                                      -7-



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


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

Liquidity and Capital Resources

On October 12, 1988, the  Partnership  commenced an Offering of 10,000 (subject
to increase to 30,000)  Limited  Partnership  Units  pursuant to a Registration
Statement on Form S-11 under the Securities  Act  of 1933.  On October 6, 1989,
the Offering terminated with a  total  of  30,000  Units  sold to the public at
$1,000 per Unit resulting in $30,000,000 in gross offering proceeds, which does
not include the Initial Limited Partner  and  the  General Partner.  All of the
holders of these  Units  have  been  admitted  to  the Partnership. The Limited
Partners of the Partnership share in  their portion of benefits of ownership of
the Partnership's real property  investments  according  to the number of Units
held.

The Partnership used $25,187,069 of  gross  offering proceeds to purchase on an
all-cash basis  twenty-five  parcels  of  undeveloped  land  and  an  option to
purchase undeveloped  land.    These  investments  include  the  payment of the
purchase price, acquisition  fees  and  acquisition  costs  of such properties.
Fourteen of the parcels were purchased during  1989 and eleven during 1990.  As
of December 31,  1998,  the  Partnership  has  had multiple sales transactions,
through which it has disposed  of  approximately 800 acres of the approximately
3,102 acres originally owned. As of December 31, 1998, cumulative distributions
to the Limited Partners have  totaled  $9,422,838 (which represents a return of
Invested Capital, as defined in the  Partnership Agreement) and $153,743 to the
General  Partner.    Through  December  31,  1998,  the  Partnership  has  used
$10,861,746 of working capital reserve  for rezoning and other activities. Such
amounts have been capitalized and are included in investments in land.

The Partnership's capital needs and resources will vary depending upon a number
of factors, including the extent to which the Partnership conducts rezoning and
other  activities  relating  to  utility  access,  the  installation  of roads,
subdivision and/or annexation of land to a municipality, changes in real estate
taxes affecting the Partnership's land, and the amount of revenue received from
leasing.  As of December 31, 1998,  the  Partnership owns, in whole or in part,
nineteen of its twenty-five original parcels,  the majority of which are leased
to local farmers and are  generating  sufficient  cash flow from farm leases to
cover property taxes and insurance.




                                      -8-



At December  31,  1998,  the  Partnership  had  cash  and  cash  equivalents of
$1,133,942, of which approximately  $46,750  is  reserved for the repurchase of
Units  through  the  Unit  Repurchase  Program.  The  remaining  $1,087,192  is
available to  be  used  for  the  Partnership  expenses  and  liabilities, cash
distributions to partners and other activities  with  respect to some or all of
its land parcels.  The  Partnership  has  increased  its parcel sales effort in
anticipation of rising land values.

The Partnership plans to enhance the  value of its land through pre-development
activities such as rezoning annexation and  land planning.  The Partnership has
already been successful in, or is in the process of pre-development activity on
a majority of the Partnership's  land  investments.    Parcels  4, 6 and 7 have
completed one phase of improvements for  an industrial park and sites are being
marketed.  Parcels 16, 21  and  23  have  been zoned with development and sales
marketing underway. The Partnership sold  the  remaining  acres of Parcel 1, 15
and 21 to unaffiliated  third-parties  (see  Note  4  of the Notes to Financial
Statements.)

Results of Operations

As of  December  31,  1998,  the  Partnership  owned  nineteen  parcels of land
consisting  of  approximately   2,302   acres.   Of   the  2,302  acres  owned,
approximately 2,070 acres are  tillable,  leased  to local farmers and generate
sufficient cash flow to cover property taxes, insurance and other miscellaneous
expenses.  Sale of investments in  land  and improvements and cost of land sold
for the year ended December 31, 1998  is  a result of the sale of approximately
272 acres, including the remaining acreage of Parcels 15 and 21 and the sale of
approximately 31  acres  of  Parcel  16.    Sale  of  investments  in  land and
improvements and cost of land sold  for  the  year ended December 31, 1997 is a
result of the sale of approximately  89 acres, including the remaining acres of
Parcel 1, the sale of five additional  lots  of Parcel 15 and the sale of 2.081
acres of Parcel 13.  Sale of  investments  in land and improvements and cost of
land sold for the year  ended  December  31,  1996  is  a result of the sale of
approximately 19 acres, including 4.629  acres  of  Parcel  24, the sale of six
lots of Parcel 15  totaling  10.53  acres,  the  sale  of  15  lots of Parcel 1
totaling 3.52  acres,  and  the  prepayments  of  the  remaining mortgage loans
receivable and recognition of deferred gain  relating  to the 1994 lot sales of
Parcel 23.  Reference is made  to  Note  4 of the Notes to Financial Statements
for additional discussion  on  the  sales  of  the  Partnership's real property
investments.

Rental income decreased for the  year  ended  December 31, 1998, as compared to
the year ended December 31, 1997, due  to the decrease in tillable acres due to
land sales and pre-development activity  on the Partnership's land investments.
This decrease is partially offset by  the annual increase in lease amounts from
tenants.  Rental income  increased  for  the  year  ended December 31, 1997, as
compared to the year ended  December  31,  1996,  due to the annual increase in
lease amounts from tenants.









                                      -9-



Interest income increased for the year  ended December 31, 1998, as compared to
the year ended December 31,  1997,  due  primarily  as a result of the interest
income earned on the  mortgage  loans  receivable the Partnership received from
the sales of the remaining acreage of  Parcels  1,  15  and  21 and the sale of
approximately 31 acres of Parcel  16.    See  Note  6 of the Notes to Financial
Statements for further discussion of the terms of the mortgage loans receivable
received from these  sales.    Interest  income  decreased  for  the year ended
December 31, 1997,  as  compared  to  the  year  ended  December  31, 1996, due
primarily to the Partnership utilizing its working capital reserve to fund pre-
development activity on the Partnership's land investments.

The other income recorded for the years ended December 31, 1998 and 1997 is the
result of  the  Partnership  receiving  non-operating  income  relating  to the
Partnership's land investments.

Professional services to Affiliates increased  for the years ended December 31,
1998 and 1997,  as  compared  to  the  year  ended  December  31,  1996, due to
increases in legal and  accounting  services  related  to the increase in sales
activity within  the  Partnership.    Professional  services  to non-affiliates
decreased for the year ended December  31,  1998, as compared to the year ended
December 31, 1997, due primarily to a decrease in legal services.  Professional
services to non-affiliates increased for  the  year ended December 31, 1997, as
compared to the year ended  December  31,  1996,  due to increases in legal and
accounting services  related  to  the  increase  in  sales  activity within the
Partnership.

General and administrative expenses to  Affiliates decreased for the year ended
December 31, 1998, as compared to  the  years ended December 31, 1997 and 1996,
due primarily to decreases  in  postage,  data processing and investor services
expenses.  General and administrative  expenses to non-affiliates decreased for
the year ended December 31, 1998,  as  compared  to the year ended December 31,
1997, and increased for the year  ended  December  31, 1997, as compared to the
year ended December 31,  1996,  due  primarily  to the Illinois Replacement Tax
paid.

Marketing expenses to Affiliates  increased  for  the  years ended December 31,
1998 and 1997, as compared  to  the  year  ended  December 31, 1996, due to the
timing of expenses relating to marketing and advertising the Partnership's land
investments for sale. Marketing  expenses  to  non-affiliates increased for the
year ended December 31, 1998, as compared  to the year ended December 31, 1997,
and decreased for the year  ended  December  31,  1997, as compared to the year
ended December 31, 1996, due to  the  timing of advertising and travel expenses
relating to marketing the land portfolio to prospective purchasers.

Land operating expenses to Affiliates decreased for the year ended December 31,
1998, as compared to the  years  ended  December  31,  1997  and 1996, due to a
decrease in Asset Management Fees incurred.   Asset Management Fees are limited
to a cumulative total over  the  life  of  the  Partnership of 2% of the land's
original cost.  As of June 30, 1998,  the Partnership had met this limit.  Land
operating expenses to non-affiliates increased for the years ended December 31,
1998 and 1997, as compared  to  the  year  ended  December  31, 1996, due to an
increase in real estate  taxes  and  maintenance  expenses of the Partnership's
land investments.




                                     -10-



Year 2000 Issues

GENERAL
-------
Many computer operating systems  and  software  applications were designed such
that the year 1999 is the  maximum  date  that can be processed accurately.  In
conducting business, the Partnership relies  on computers and operating systems
provided by equipment manufacturers, and also on application software developed
internally and,  to  a  limited  extent,  by  outside  software  vendors.   The
Partnership has assessed its  vulnerability  to the so-called "Year-2000 Issue"
with respect to its equipment and computer systems.

STATE OF READINESS
------------------
The  Partnership  has  identified  the  following  two  areas  for  "Year-2000"
compliance efforts:

Business  Computer  Systems:  The  majority  of  the  Partnership's information
technology systems  were  developed  internally  and  include accounting, lease
management, investment portfolio  tracking,  and  tax  return preparation.  The
Partnership has rights to the  source  code  for these applications and employs
programmers who are  knowledgeable  regarding  these  systems.   The process of
testing these internal  systems  to  determine  year  2000 compliance is nearly
complete.  The Partnership does  not  anticipate any material costs relating to
its  business  computer  systems  regarding  year  2000  compliance  since  the
Partnership's  critical  hardware  and  software  systems  use  four  digits to
represent the applicable year.  The Partnership does use various computers, so-
called "PC's", that may run software that  may not use four digits to represent
the applicable year.  The  Partnership  is  in  the  process  of testing the PC
hardware and software to determine year  2000  compliance, but it must be noted
that such PC's  are  incidental  to  the  Partnership's  critical systems.  The
Partnership is considering independent testing of its critical systems.

Suppliers and other Parties:  The  Partnership  is  in the process of surveying
suppliers and other parties with whom the Partnership does a significant amount
of business to identify the Partnership's  potential exposure in the event such
parties are not year 2000  compliant  in  a  timely  manner.  At this time, the
Partnership is not aware of any party that is anticipating a material Year 2000
compliance issue.  However, since  this  area  involves some parties over which
the Partnership  has  no  control,  such  as  public  utility  companies, it is
difficult, at best, to judge  the  status  of  the outside companies' year 2000
compliance. The Partnership is working closely  with all suppliers of goods and
services in an effort to minimize the  impact of the failure of any supplier to
become  year  2000   compliant   by   December   31,  1999.  The  Partnership's
investigations  and  assessments  of  possible   year  2000  issues  are  in  a
preliminary stage, and currently the  Partnership  is not aware of any material
impact on its business, operations or  financial  condition even if one or more
parties is not Year 2000 compliant  in  a  timely manner, due to the number and
nature of the Partnership's diverse supplier base.








                                     -11-



YEAR 2000 RISKS
---------------
The most reasonable likely worst case scenario for the Partnership with respect
to the year 2000 non-compliance of  its  business computer systems would be the
inability to access information  which  could  result  in  the failure to issue
financial reports.

YEAR 2000 COSTS
---------------
The Partnership's General Partner  and  its  Affiliates  estimate that costs to
achieve  year  2000  compliance   will   not  exceed  $100,000.  However,  only
approximately 1% of these costs will  be  directly allocated to and paid by the
Partnership. The balance of the  year 2000 compliance costs, approximately 99%,
will be paid by  the  General  Partner  and  its  Affiliates.   Total year 2000
compliance  costs  incurred  through   December   31,  1998  are  estimated  at
approximately $5,000.

CONTINGENCY PLAN
----------------
The Partnership is expects to  be  Year  2000  compliant in advance of the year
2000.  The Partnership  will  continue  to  monitor  its  progress and state of
readiness, and is in the  process  of  formulating a contingency plan which the
Partnership will be prepared to adopt  with  respect to areas in which evidence
arises that it may not  become  Year  2000  compliant in sufficient time.  With
respect to its suppliers and  other  parties with whom the Partnership conducts
business, the Partnership does not  yet have sufficient information to identify
the types of problems it may encounter in the event these third parties are not
Year 2000 compliant.  As information is obtained that may indicate such parties
may not become  Year  2000  compliant  in  sufficient  time, the Partnership is
prepared to develop contingency plans, accordingly.


Inflation

Inflation in future periods may cause capital appreciation of the Partnership's
investments in land.   Rental  income  levels  (from  leases  to new tenants or
renewals of existing tenants)  will  rise  and  fall  in accordance with normal
agricultural market conditions and may or may not be affected by inflation.


Item 7(a). Quantitative and Qualitative Disclosures About Market Risk

Not Applicable.














                                     -12-



Item 8.  Financial Statements and Supplementary Data



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


                                     Index
                                     -----

                                                                          Page
                                                                          ----
Independent Auditors' Report.............................................   14

Financial Statements:

  Balance Sheets, December 31, 1998 and 1997.............................   15

  Statements of Operations, for the years ended
    December 31, 1998, 1997 and 1996.....................................   17

  Statements of Partners' Capital, for the years ended
    December 31, 1998, 1997 and 1996.....................................   19

  Statements of Cash Flows, for the years ended
    December 31, 1998, 1997 and 1996.....................................   20

  Notes to Financial Statements..........................................   22



Schedules not filed:

All schedules have been omitted as  the required information is inapplicable or
the information is presented in the financial statements or related notes.





















                                     -13-







INDEPENDENT AUDITORS' REPORT


To the Partners of 
Inland Land Appreciation Fund, L.P. 

We have audited the  accompanying  balance  sheets  of Inland Land Appreciation
Fund, L.P. (a limited partnership) as  of  December  31, 1998 and 1997, and the
related statements of operations, partners' capital, and cash flows for each of
the three years  in  the  period  ended  December  31,  1998.   These financial
statements  are  the  responsibility  of  the  Partnership's  management.   Our
responsibility is to express an opinion  on these financial statements based on
our audits.  

We  conducted  our  audits  in  accordance  with  generally  accepted  auditing
standards.  Those standards  require  that  we  plan  and  perform the audit to
obtain reasonable assurance about whether  the financial statements are free of
material misstatement.  An audit includes  examining, on a test basis, evidence
supporting the amounts and disclosures  in  the financial statements.  An audit
also  includes  assessing  the   accounting  principles  used  and  significant
estimates made by  management,  as  well  as  evaluating  the overall financial
statement presentation.  We believe that  our audits provide a reasonable basis
for our opinion.

In our opinion,  such  financial  statements  present  fairly,  in all material
respects, the financial position of  Inland  Land Appreciation Fund, L.P. as of
December 31, 1998 and 1997,  and  the  results  of  its operations and its cash
flows for each of the three  years  in  the  period ended December 31, 1998, in
conformity with generally accepted accounting principles.  



DELOITTE & TOUCHE LLP


Chicago, Illinois
January 29, 1999
















                                     -14-



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

                                Balance Sheets

                          December 31, 1998 and 1997


                                    Assets
                                    ------

                                                       1998          1997
Current assets:                                        ----          ----
  Cash and cash equivalents (Note 1).............. $ 1,133,942        15,502
  Accounts and accrued interest 
    receivable (Note 6)...........................     181,821         1,361
  Current portion of mortgage loans
    receivable (Note 6)...........................      20,371       575,000
  Other current assets............................       1,584         2,241 
                                                   ------------  ------------
Total current assets..............................   1,337,718       594,104 
                                                   ------------  ------------
Other assets......................................      19,915        19,915
Mortgage loans receivable, less current
    portion (Note 6)..............................   3,010,823     1,595,089
Investments in land and improvements, at cost
  (including acquisition fees paid to Affiliates
  of $970,132 and $1,430,329 at December 31,
  1998 and 1997, respectively) (Notes 3 and 4)....  21,440,929    25,848,790 
                                                   ------------  ------------
Total assets...................................... $25,809,385    28,057,898
                                                   ============  ============























                See accompanying notes to financial statements.


                                     -15-



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

                                Balance Sheets
                                  (continued)
                          December 31, 1998 and 1997


                       Liabilities and Partners' Capital
                       ---------------------------------

                                                       1998          1997
                                                       ----          ----
Current liabilities:
  Accounts payable................................ $     2,497        25,185
  Accrued real estate taxes.......................      42,174        47,889
  Due to Affiliates (Notes 3 and 7)...............     275,297       595,655
  Notes payable to Affiliate (Note 7).............   2,493,750     3,283,471
  Unearned income.................................      54,024        19,278 
                                                   ------------  ------------
Total current liabilities.........................   2,867,742     3,971,478

Deferred gain on sale of investments in land and
  improvements (Note 6)...........................     376,302       106,905

Partners' capital (Notes 1 and 2):
  General Partner:
    Capital contribution..........................         500           500
    Cumulative net income.........................     168,478       165,949
    Cumulative cash distributions.................    (153,743)     (153,743)
                                                   ------------  ------------
                                                        15,235        12,706 
  Limited Partners:                                ------------  ------------
    Units of $1,000. Authorized 30,001 Units,
      29,606.25 and 29,629.25 outstanding at
      December 31, 1998 and 1997, respectively
      (net of offering costs of $3,768,113, of
      which $1,069,764 was paid to Affiliates)....  25,882,018    25,900,396
    Cumulative net income.........................   6,090,926     4,062,632 
    Cumulative cash distributions.................  (9,422,838)   (5,996,219)
                                                   ------------  ------------
                                                    22,550,106    23,966,809 
                                                   ------------  ------------
Total Partners' capital...........................  22,565,341    23,979,515 
                                                   ------------  ------------
Total liabilities and Partners' capital........... $25,809,385    28,057,898 
                                                   ============  ============








                See accompanying notes to financial statements.


                                     -16-



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

                           Statements of Operations

             For the years ended December 31, 1998, 1997 and 1996



                                         1998          1997          1996
                                         ----          ----          ----
Income:
  Sale of investments in land and
    improvements (Note 4)........... $ 5,742,721     6,190,802     1,101,329
  Recognition of deferred gain on
    sale of investments in land
    and improvements (Note 6).......   1,574,424          -             -
  Rental income (Note 5)............     240,240       241,853       235,458
  Interest income...................     433,319           348        11,129
  Other income......................      17,500         5,300           179 
                                     ------------  ------------  ------------
                                       8,008,204     6,438,303     1,348,095 
                                     ------------  ------------  ------------
Expenses:
  Cost of land sold.................   5,539,189     5,846,535       567,886
  Professional services to
    Affiliates......................      47,335        47,558        45,673
  Professional services to
    non-affiliates..................      32,672        46,652        32,627
  General and administrative
    expenses to Affiliates..........      22,907        29,694        29,644
  General and administrative
    expenses to non-affiliates......      17,123        19,838        15,674
  Marketing expenses
    to Affiliates...................      90,279       123,333        57,870
  Marketing expenses to
    non-affiliates..................      63,967        19,797        35,228
  Land operating expenses to
    Affiliates......................      25,858        55,279        56,774
  Land operating expenses to
    non-affiliates..................     138,051        77,943        55,470 
                                     ------------  ------------  ------------
                                       5,977,381     6,266,629       896,846 
                                     ------------  ------------  ------------
Net income.......................... $ 2,030,823       171,674       451,249
                                     ============  ============  ============
 








                See accompanying notes to financial statements.


                                     -17-



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

                           Statements of Operations
                                  (continued)

             For the years ended December 31, 1998, 1997 and 1996



                                         1998          1997          1996
                                         ----          ----          ----
Net income (loss) allocated (Note 2):
  General Partner................... $     2,529        (1,726)         (822)
  Limited Partners..................   2,028,294       173,400       452,071 
                                     ------------  ------------  ------------
Net income.......................... $ 2,030,823       171,674       451,249
                                     ============  ============  ============

Net income (loss) allocated to
  the one General Partner Unit...... $     2,529        (1,726)         (822)
                                     ============  ============  ============

Net income per Unit allocated to
  Limited Partners per weighted
  average Limited Partnership Units
  (29,621.04, 29,639.10 and 29,738.54
  for the years ended December 31,
  1998, 1997 and 1996, respectively) $     68.47          5.85         15.20
                                     ============  ============  ============

























                See accompanying notes to financial statements.


                                     -18-



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

                        Statements of Partners' Capital

             For the years ended December 31, 1998, 1997 and 1996



                                        General      Limited
                                        Partner      Partners       Total
                                        -------      --------       -----
Balance at January 1, 1996.......... $    15,254    25,331,586    25,346,840

Net income (loss) (Note 2).........         (822)      452,071       451,249
Distributions to Partners (Note 1)..        -               (9)           (9)
Repurchase of Limited Partnership
  Units.............................        -         (114,577)     (114,577)
                                     ------------  ------------  ------------
Balance at December 31, 1996........      14,432    25,669,071    25,683,503

Net income (loss) (Note 2)..........      (1,726)      173,400       171,674
Distributions to Partners ($62.41 per
  weighted average Limited Partnership
  Units of 29,639.10) (Note 2)......        -       (1,849,815)   (1,849,815)
Repurchase of Limited Partnership
  Units.............................        -          (25,847)      (25,847)
                                     ------------  ------------  ------------
Balance at December 31, 1997........      12,706    23,966,809    23,979,515

Net income (Note 2).................       2,529     2,028,294     2,030,823
Distributions to Partners ($115.68 per
  weighted average Limited Partnership
  Units of 29,621.04) (Note 2)......        -       (3,426,619)   (3,426,619)
Repurchase of Limited Partnership
  Units.............................        -          (18,378)      (18,378)
                                     ------------  ------------  ------------
Balance at December 31, 1998........ $    15,235    22,550,106    22,565,341
                                     ============  ============  ============
















                See accompanying notes to financial statements.


                                     -19-



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

                           Statements of Cash Flows

             For the years ended December 31, 1998, 1997 and 1996



                                         1998          1997          1996
                                         ----          ----          ----
Cash flows from operating activities:
  Net income........................ $ 2,030,823       171,674       451,249
  Adjustments to reconcile net income
      to net cash provided by 
      operating activities:
    Gain on sale of investments in
      land and improvements.........    (203,532)     (344,267)     (533,443)
    Recognition of deferred gain on
      sale of investments in land
      and improvements..............  (1,574,424)         -             -
    Changes in assets and liabilities:
      Accounts and accrued interest
       receivable...................    (180,460)       (1,361)        7,224
      Other current assets..........         657            89        (1,165)
      Accounts payable..............     (22,688)      (57,188)      (49,399) 
      Accrued real estate taxes.....      (5,715)         (228)          384
      Due to Affiliates.............    (264,432)      446,279       135,521
      Unearned income...............      34,746        (3,961)        2,532 
Net cash provided by (used in)       ------------  ------------  ------------
  operating activities..............    (185,025)      211,037        12,903 
                                     ------------  ------------  ------------
Cash flows from investing activities:
  Principal payments collected on
    mortgage loans receivable.......   4,918,596          -           73,614
  Additions to investments in land
    and improvements................  (1,131,328)   (3,018,999)   (4,397,239)
  Proceeds from disposition of
    investments in land and
    improvements....................   1,356,292       802,103     1,086,403 
Net cash flow provided by (used in)  ------------  ------------  ------------
  investing activities..............   5,143,560    (2,216,896)   (3,237,222)
                                     ------------  ------------  ------------
Cash flows from financing activities:
  Repurchase of Limited Partnership
    Units...........................     (18,378)      (25,847)     (114,577)
  Net proceeds from notes payable to
    Affiliate.......................    (395,098)    3,807,351     2,801,635
  Cash distributions................  (3,426,619)   (1,849,815)           (9)
Net cash flow provided by (used in)  ------------  ------------  ------------
  financing activities..............  (3,840,095)    1,931,689     2,687,049 
                                     ------------  ------------  ------------



                See accompanying notes to financial statements.


                                     -20-



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

                             Statements of Cash Flows
                                    (continued)

               For the years ended December 31, 1998, 1997 and 1996

                                         1998          1997          1996
                                         ----          ----          ----
Net increase (decrease) in cash
  and cash equivalents.............. $ 1,118,440       (74,170)     (537,270)
Cash and cash equivalents at
  beginning of year.................      15,502        89,672       626,942 
Cash and cash equivalents at end     ------------  ------------  ------------
  of year........................... $ 1,133,942        15,502        89,672
                                     ============  ============  ============



Supplemental schedule of non-cash investing and financing activities:


                                         1998          1997          1996
                                         ----          ----          -----
Mortgage loans receivable........... $(5,779,701)   (2,170,089)         -       
Reduction in investments in land
  and improvements..................   5,539,189     5,846,535          -
Gain on sale of investments in land
  and improvements..................     203,532       344,267          -
Assumption of note and interest
  payable to Affiliate..............    (450,549)   (3,325,515)         -
Deferred gain on sale of investments
  in land and improvements..........   1,843,821       106,905          -    
Proceeds from disposition of         ------------  ------------  ------------
  investments in land and
  improvements...................... $ 1,356,292       802,103          -    
                                     ============  ============  ============

















                See accompanying notes to financial statements.


                                     -21-



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

                         Notes to Financial Statements

             For the years ended December 31, 1998, 1997 and 1996


(1) Organization and Basis of Accounting

The Registrant, Inland Land  Appreciation  Fund,  L.P. (the "Partnership"), was
formed in  October  1987,  pursuant  to  the  Delaware  Revised Uniform Limited
Partnership Act, to invest in undeveloped land on an all-cash basis and realize
appreciation of such land  upon  resale.  On  October 12, 1988, the Partnership
commenced an  Offering  of  10,000  (subject  to  increase  to  30,000) Limited
Partnership Units ("Units") pursuant to  a  Registration Statement on Form S-11
under the Securities Act of 1933.  Inland Real Estate Investment Corporation is
the General Partner.  The  Offering  terminated  on October 6, 1989, with total
sales of 30,000 Units, at $1,000 per Unit, not including the General Partner or
the Initial Limited Partner.    All  of  the  holders  of these Units have been
admitted to this Partnership.  The Limited Partners of the Partnership share in
their portion of  benefits  of  ownership  of  the  Partnership's real property
investments according to the number of Units  held.    As of December 31, 1998,
the Partnership has  repurchased  a  total  of  394.75  Units for $350,868 from
various Limited Partners  through  the  Unit  Repurchase  Program.   Under this
program Limited  Partners  may  under  certain  circumstances  have their Units
repurchased for an amount equal to their Invested Capital.

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

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

The Partnership  considers  all  highly  liquid  investments  purchased  with a
maturity of three months or  less  to  be  cash  equivalents and are carried at
cost, which approximates market.

Except as described in footnote (b)  to  Note 4 of these notes, the Partnership
uses the area  method  of  allocation,  which  approximates  the relative sales
method of  allocation,  whereby  a  per  acre  price  is  used  as the standard
allocation method for land purchases and  sales.   The total cost of the parcel
is divided by the total number of acres to arrive at a per acre price.

Statement  of  Financial  Accounting  Standards  No.  121  "Accounting  for the
Impairment of Long-Lived Assets and  for  Long-Lived  Assets to be Disposed of"
("SFAS 121") requires  the  Partnership  to  record  an  impairment loss on its
property to be held for investment  whenever its carrying value cannot be fully
recovered  through  estimated  undiscounted   future   cash  flows  from  their
operations and sale.  The amount of  the impairment loss to be recognized would
be the difference  between  the  property's  carrying  value and the property's
estimated fair value.  As of  December  31,  1998 and 1997, the Partnership has
not recognized any such impairment.


                                     -22-



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

                         Notes to Financial Statements
                                  (continued)

The Partnership is required to  pay  a  withholding tax to the Internal Revenue
Service with  respect  to  a  Partner's  allocable  share  of the Partnership's
taxable net income, if the  Partner  is  a foreign person. The Partnership will
first pay the withholding tax  from  the  distributions to any foreign partner,
and to the extent that the tax exceeds the amount of distributions withheld, or
if there have been no distributions  to  withhold, the excess will be accounted
for as a distribution to the foreign partner. Withholding tax payments are made
every April, June, September and December.

Statement of Financial Accounting  Standards  No.  128 "Earnings per Share" was
adopted by the Partnership for the  year  ended  December 31, 1997 and has been
applied to all prior  earnings  periods  presented in the financial statements.
The Partnership has no dilutive securities.

A presentation of information about operating segments as required in Statement
of Financial Accounting Standards  No.  131  "Disclosures  About Segments of an
Enterprise and Related Information" would  not  be material to an understanding
of the Partnership's business taken as a whole as the Partnership is engaged in
the business of  real  estate  investment  which  management  considers to be a
single operating segment.

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

The Partnership's records are maintained on  the accrual basis of accounting in
accordance with generally accepted accounting principles ("GAAP").  The Federal
income tax return has been prepared  from such records after making appropriate
adjustments, if any,  to  reflect  the  Partnership's  accounts as adjusted for
Federal income tax reporting purposes.    Such  adjustments are not recorded in
the records of the Partnership.  The net effect of these items is summarized as
follows:
                                       1998                      1997          
                             ------------------------  ------------------------
                                               Tax                      Tax
                                 GAAP         Basis       GAAP         Basis
                                 Basis     (unaudited)    Basis     (unaudited)
                             ------------ ------------ ----------- ------------
  Total assets.............. $25,809,385   29,577,498   28,057,898  31,826,012

  Partners' capital:
    General Partner.........      15,235       16,851       12,706      15,259
    Limited Partners........  22,550,106   26,316,603   23,966,809  27,732,370

  Net income (loss):
    General Partner.........       2,529        1,592       (1,726)       (836)
    Limited Partners........   2,028,294    2,029,230      173,400     172,510

  Net income per Limited
    Partnership Unit........       68.47        68.51         5.85        5.82

The net income per Unit is based  upon  the weighted average number of Units of
29,621.04 and 29,639.10 during 1998 and 1997, respectively.


                                     -23-



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

                         Notes to Financial Statements
                                  (continued)


(2) Partnership Agreement

The Partnership Agreement defines  the  allocation  of  profits and losses, and
available cash.  If and  to  the  extent  that  real estate taxes and insurance
payable with respect  to  the  Partnership's  land  during  a given year exceed
revenues of the  Partnership,  the  General  Partner  will  make a Supplemental
Capital Contribution of such amount  to  the  Partnership to ensure that it has
sufficient funds to make such payments.

Profits and losses from  operations  (other  than capital transactions) will be
allocated 99% to the Limited Partners and  1%  to the General Partner.  The net
gain from  a  sale  of  Partnership  properties  is  first  allocated among the
Partners in proportion to the  negative  balances,  if any, in their respective
capital accounts.  Thereafter, except as  provided below, net gain is allocated
to the General Partner in an  amount  equal  to the proceeds distributed to the
General Partner from such sale and the  balance of any net gain is allocated to
the Limited Partners.  If the amount  of  net gain realized from a sale is less
than the amount of cash distributed to  the General Partner from such sale, the
Partnership will allocate income or  gain  to  the General Partner in an amount
equal to the excess of the cash distributed to the General Partner with respect
to such sale as quickly as permitted by law.   Any net loss from a sale will be
allocated to the Limited Partners.

Distributions of  Net  Sale  Proceeds  will  be  allocated  between the General
Partner and the Limited Partners based upon both an aggregate overall return to
the Limited Partners and a separate return  with respect to each parcel of land
purchased by the Partnership.

As a general rule, Net  Sale  Proceeds  will  be distributed 90% to the Limited
Partners and  10%  to  the  General  Partner  until  the  Limited Partners have
received from Net Sale Proceeds  (i)  a  return  of their Original Capital plus
(ii) a noncompounded  Cumulative  Preferred  Return  of  15%  of their Invested
Capital.  However, with respect to  each  parcel of land, the General Partner's
10% share will be subordinated until  the  Limited Partners receive a return of
the Original Capital attributed to such parcel ("Parcel Capital") plus a 6% per
annum noncompounded Cumulative Preferred Return thereon.

After the amounts described  in  items  (i)  and  (ii) above and any previously
subordinated distributions to  the  General  Partner  have  been  paid, and the
amount of  any  Supplemental  Capital  Contributions  have  been  repaid to the
General Partner, subsequent  distributions  shall  be  paid  75% to the Limited
Partners and 25% to  the  General  Partner  without considering Parcel Capital.
If, after all Net Sale Proceeds  have been distributed, the General Partner has
received more than 25%  of  all  Net  Sale Proceeds (exclusive of distributions
made to the Limited  Partners  to  return  their Original Capital), the General
Partner shall contribute to  the  Partnership  for  distribution to the Limited
Partners an amount equal to such excess.



                                     -24-



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

                         Notes to Financial Statements
                                  (continued)


Any distributions from Net Sale  Proceeds  at  a  time when Invested Capital is
greater than zero shall be deemed applied first as a reduction of such Invested
Capital before application to payment  of  any deficiency in the 15% Cumulative
Preferred Return.


(3) Transactions with Affiliates

The General  Partner  and  its  Affiliates  are  entitled  to reimbursement for
salaries and expenses of employees  of  the  General Partner and its Affiliates
relating to the administration of the  Partnership.  Such costs are included in
professional services and general and administrative expenses to Affiliates, of
which $65,066  and  $90,278  was  unpaid  as  of  December  31,  1998 and 1997,
respectively.

The General Partner is entitled to  receive Asset Management Fees equal to one-
quarter of 1% of  the  original  cost  to  the  Partnership of undeveloped land
annually, limited to a cumulative total over  the life of the Partnership of 2%
of the land's original cost  to  the  Partnership.    As  of June 30, 1998, the
Partnership had met this limit.  Such fees of $25,858, $55,279 and $56,774 have
been  incurred  for  the  years  ended   December  31,  1998,  1997  and  1996,
respectively, and are included  in  land  operating  expenses to Affiliates, of
which $81,136  and  $55,279  was  unpaid  as  of  December  31,  1998 and 1997,
respectively.

An  Affiliate  of  the  General  Partner  performed  marketing  and advertising
services for the Partnership and  was  reimbursed  (as set forth under terms of
the Partnership Agreement) for direct  costs.   Such costs of $90,279, $123,333
and $57,870 have  been  incurred  and  are  included  in  marketing expenses to
Affiliates for the years ended December  31, 1998, 1997 and 1996, respectively,
of which $14,829 and $151,908  was  unpaid  as  of  December 31, 1998 and 1997,
respectively.

An Affiliate of  the  General  Partner  performed  property upgrades, rezoning,
annexation and other activities  to  prepare the Partnership's land investments
for sale and  was  reimbursed  (as  set  forth  under  terms of the Partnership
Agreement) for salaries and direct  costs.    The Affiliate did not recognize a
profit on any project.  Such costs  of $188,506 and $233,540 have been incurred
for the years ended December 31,  1998 and 1997, respectively, and are included
in investments in land, of which $0  and $113,878 was unpaid as of December 31,
1998 and 1997, respectively.









                                     -25-



<TABLE>                                        INLAND LAND APPRECIATION FUND, L.P.
                                                     (a limited partnership)

                                                  Notes to Financial Statements
                                                           (continued)

(4) Investments in Land and Improvements
<CAPTION>
                                                                                                              Total
                   Gross                            Initial Costs                 Costs                     Remaining    Current
                   Acres    Purchase/  --------------------------------------  Capitalized     Costs of      Costs of   Year Gain
       Location: Purchased    Sales       Original  Acquisition     Total     Subsequent to    Property     Parcels at   on Sale
Parcel  County    (Sold)      Date         Costs       Costs        Costs      Acquisition       Sold        12/31/98   Recognized 
------ --------- ---------  ---------- ------------ ------------ ------------ -------------- ------------ ------------ ------------
<S>     <C>       <C>        <C>         <C>           <C>         <C>          <C>           <C>           <C>            <C>
 1      Kendall    84.7360   01/19/89  $   423,680       61,625      485,305      5,462,589    5,947,894          -         36,604
                   (3.5200)  12/24/96
                    (.3520)  11/25/97
                  (80.8640)  12/29/97

 2      McHenry   223.4121   01/19/89      650,000       95,014      745,014         22,295      611,505       155,804        -
                 (183.3759)  12/27/90  

 3      Kendall    20.0000   02/09/89      189,000       13,305      202,305           -         202,305          -           -
                  (20.0000)  05/08/90  

 4      Kendall    69.2760   04/18/89      508,196       38,126      546,322         64,391      235,275       375,438        -
                    (.4860)  02/28/91
                  (27.5750)  08/25/95

 5      Kendall   372.2230   05/03/89    2,532,227      135,943    2,668,170         52,877      160,313     2,560,734        -
        (a)        (Option)  04/06/90  

 6      Kendall    78.3900   06/21/89      416,783       31,691      448,474        201,347         -          649,821        -
        (b)
 7      Kendall    77.0490   06/21/89       84,754        8,163       92,917        187,142         -          280,059        -
        (b)
 8      Kendall     5.0000   06/21/89       60,000        5,113       65,113           -          65,113          -           -
        (b)        (5.0000)  10/06/89

 9      McHenry    51.0300   08/07/89      586,845       22,482      609,327          3,085         -          612,412        -
        (b)
10      McHenry   123.9400   08/07/89       91,939        7,224       99,163            600       99,763          -           -
        (b)      (123.9400)  12/06/89

11      McHenry    30.5920   08/07/89      321,216       22,641      343,857          7,604         -          351,461        -
        (b)
12      Kendall    90.2710   10/31/89      907,389       41,908      949,297          1,830        7,456       943,671        -
                    (.7090)  04/26/91

13      McHenry    92.7800   11/07/89      251,306       19,188      270,494          4,918        6,136       269,276        -
                   (2.0810)  09/18/97

14      McHenry    76.2020   11/07/89      419,111       23,402      442,513         44,263         -          486,776        -

15       Lake      84.5564   01/03/90    1,056,955       85,283    1,142,238      1,661,344    2,803,582          -        154,764
                  (10.5300)  Var 1996
                   (5.4680)  Var 1997
                  (68.5584)  Var 1998                                                                                               
                                       ------------ ------------ ------------ -------------- ------------ ------------ -------------
        Subtotal                       $ 8,499,401      611,108    9,110,509      7,714,285   10,139,342     6,685,452     191,368


                                                                   -25-


                                     -26-



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

                                                       Notes to Financial Statements
                                                                (continued)



(4) Investments in Land and Improvements (continued)
                                                                                                              Total
                   Gross                            Initial Costs                 Costs                     Remaining    Current
                   Acres    Purchase/  --------------------------------------  Capitalized     Costs of      Costs of   Year Gain
       Location: Purchased    Sales       Original  Acquisition     Total     Subsequent to    Property     Parcels at   on Sale
Parcel  County    (Sold)      Date         Costs       Costs        Costs      Acquisition       Sold        12/31/98   Recognized 
------ --------- ---------  ---------- ------------ ------------ ------------ -------------- ------------ ------------ ------------

       Subtotal                        $ 8,499,401      611,108    9,110,509      7,714,285   10,139,342     6,685,452    191,368

16  Kane/Kendall  72.4187    01/29/90    1,273,537       55,333    1,328,870        644,951      815,516     1,158,305  1,057,597
                 (30.9000)   07/10/98

17      McHenry   99.9240    01/29/90      739,635       61,038      800,673        360,304         -        1,160,977       -

18      McHenry   71.4870    01/29/90      496,116       26,259      522,375         21,479       11,109       532,745       -
                  (1.0000)   Var 1990
                   (.5200)   03/11/93

19      McHenry   63.6915    02/23/90      490,158       29,158      519,316          8,714         -          528,030       -

20       Kane    224.1480    02/28/90    2,749,800      183,092    2,932,892        477,577        3,651     3,406,818       -
                   (.2790)   10/17/91

21      Kendall  172.4950    03/08/90    1,327,459       75,822    1,403,281        954,415    2,357,696          -       528,991
                (172.4950)   Var 1998

22      McHenry  254.5250    04/11/90    2,608,881      136,559    2,745,440         34,455         -        2,779,895       -

23      Kendall  140.0210    05/08/90    1,480,000      116,240    1,596,240        611,479    1,196,909     1,010,810       -
                  (4.4100)   Var 1993
                 (35.8800)   Var 1994
                  (3.4400)   Var 1995

24      Kendall  298.4830    05/23/90    1,359,774       98,921    1,458,695         19,958       83,663     1,394,990       -
                 (12.4570)   05/25/90
                  (4.6290)   04/01/96

25       Kane    225.0000    06/01/90    2,600,000      168,778    2,768,778         14,129         -        2,782,907       -    
                                       ------------ ------------ ------------ -------------- ------------ ------------ -----------
                                       $23,624,761    1,562,308   25,187,069     10,861,746   14,607,886    21,440,929  1,777,956
                                       ============ ============ ============ ============== ============ ============ ===========








</TABLE>
                                                                   -26-


                                     -27-



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

                         Notes to Financial Statements
                                  (continued)


(4) Investments in Land and Improvements (continued)

(a) Included in  the  purchase  agreement  of  Parcel  5  was  a condition that
    required the Partnership to  buy  an  option  to purchase an additional 243
    acres immediately to the west of this parcel.  The sale transaction relates
    to the sale of this option.

(b) The Partnership  purchased  from  two  third  parties,  two  sets  of three
    contiguous parcels of land (Parcels 6, 7  and 8; and Parcels 9, 10 and 11).
    The General Partner believes  that  the  total  value  of this land will be
    maximized if it is treated and  marketed  to buyers as six separate parcels
    and closed the transactions as  six  separate purchases to facilitate this.
    Parcels 6, 7 and 8 will be treated  as  one parcel and Parcels 9, 10 and 11
    will be treated as one parcel  for purposes of computing Parcel Capital (as
    defined) and distributions to the Partners.

(c) Reconciliation of investments in land and improvements owned:

                                          1998               1997   
                                      ------------       ------------
    Balance at January 1,...........  $25,848,790         28,676,326
    Additions during year...........    1,131,328          3,018,999
    Sales during year...............    5,539,189          5,846,535 
                                      ------------       ------------
    Balance at December 31,.........  $21,440,929         25,848,790
                                      ============       ============

(d) The aggregate  cost  of  investments  in  land  and  improvements  owned at
    December  31,  1998  for  Federal  income  tax  purposes  was approximately
    $21,440,000 (unaudited).


(5) Rental Income

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

As of December 31, 1998, the Partnership  had farm leases of generally one year
in duration, for approximately  2,070  acres  of  the approximately 2,302 acres
owned.










                                     -28-



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

                         Notes to Financial Statements
                                  (continued)


(6) Mortgage Loans Receivable

As a result of the sale of the remaining approximately 81 acres of Parcel 1 for
a sales price of $5,750,000  on  December  29,  1997, the purchaser assumed the
note payable  to  an  Affiliate  on  this  parcel  totaling  $3,325,515 and the
interest  payable  to  the  Affiliate  of  $254,396.  The  Partnership received
mortgage loans receivable totaling $2,170,089  and  recorded a deferred gain on
sale of $106,905. The deferred  gain  will  be  recognized over the life of the
related mortgage loans receivable as  principal payments are received, of which
$36,604 has been recognized as of December 31, 1998. Of the $2,170,089 mortgage
loans receivable received, $575,000 accrued interest  at 9% per annum and had a
maturity date of July 1, 1998, at  which  time all accrued interest, as well as
principal, was due. On June 19, 1998, this mortgage loan receivable of $575,000
was paid in full and  the  Partnership  received $599,528 which represented the
loan balance and accrued interest. The remaining $1,595,089 accrues interest at
9% per annum and has a maturity  date  of  December 30, 2000, at which time all
accrued interest, as well as principal,  is  due.  As of December 31, 1998, the
remaining mortgage loan receivable balance  was $1,427,057 and accrued interest
totaled $46,448.

As a result of the sale of Lot 7  of  Parcel 15 for a sales price of $89,100 on
June 9, 1998, the Partnership received  net  sales proceeds of $490, a mortgage
loan receivable of $88,101 and recorded a deferred gain on sale of $56,426. The
deferred gain will be recognized  over  the  life  of the related mortgage loan
receivable as principal payments are received, of which $25 has been recognized
as of December 31, 1998.  The  mortgage  loan receivable accrues interest at 9%
per annum, paid monthly, and  has  a  maturity  date  of  July  1, 2001.  As of
December 31, 1998, the remaining  mortgage  loan receivable balance was $88,064
and accrued interest totaled $660.

As a result of the sale of Lot 9  of  Parcel 15 for a sales price of $92,691 on
June 11, 1998,  the  Partnership  received  net  sales  proceeds  of $62,173, a
mortgage loan receivable of $30,000  and  recorded  a  deferred gain on sale of
$18,514. The deferred gain  will  be  recognized  over  the life of the related
mortgage loan receivable as  principal  payments  are received, of which $5,942
has been recognized  as  of  December  31,  1998.  The mortgage loan receivable
accrues interest at 9% per  annum,  paid  monthly,  and  has a maturity date of
October 1,  1999.    As  of  December  31,  1998,  the  remaining mortgage loan
receivable balance was $20,371 and accrued interest totaled $153.











                                     -29-



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

                         Notes to Financial Statements
                                  (continued)


As a result of the sale of  the  remaining approximately 126 acres of Parcel 21
for a sales price of  $2,900,000  on  June  25, 1998, the purchaser assumed the
note payable to an Affiliate on  this parcel totaling $394,623 and the interest
payable to the Affiliate  of  $55,926.  The Partnership received mortgage loans
receivable  totaling  $2,449,451  and  recorded  a  deferred  gain  on  sale of
$653,933. The deferred gain will  be  recognized  over  the life of the related
mortgage loans receivable as principal payments are received, of which $440,769
has been recognized as of December 31,  1998.  Of the $2,449,451 mortgage loans
receivable received, $1,651,000 (originally  $1,983,000) accrues interest at 9%
per annum and had a maturity date of November 16, 1998 (extended from September
30, 1998), at which time  all  principal  was  due.   On November 17, 1998, the
Partnership received $1,651,000.   The remaining $798,451 (originally $466,451)
accrues interest at 9% per annum and  has  a maturity date of June 30, 2003, at
which time all accrued interest, as well  as principal, is due.  As of December
31, 1998, the  remaining  mortgage  loan  receivable  balance  was $798,451 and
accrued interest totaled $96,239.

As a result of the sale  of  the  remaining approximately 50 acres of Parcel 15
for a sales price  of  $1,850,000  on  June  25, 1998, the Partnership received
mortgage loans receivable totaling $1,850,000  and  recorded a deferred gain on
sale of $63,317. The deferred  gain  will  be  recognized  over the life of the
related mortgage loans receivable as  principal payments are received, of which
$39,453 has been  recognized  as  of  December  31,  1998.    Of the $1,850,000
mortgage loans receivable received, $1,152,749 accrues interest at 9% per annum
and had a maturity date  of  November  16,  1998  (extended from  September 30,
1998), at which  time  all  principal  was  due.    On  November  17, 1998, the
Partnership received $1,152,749.  The remaining $697,251 accrues interest at 9%
per annum and has a maturity date  of  June 30, 2002, at which time all accrued
interest, as well as principal, is due.  As of December 31, 1998, the remaining
mortgage loan receivable  balance  was  $697,251  and  accrued interest totaled
$37,278.

As a result of the sale  of  approximately  31  acres  of Parcel 16 for a sales
price of $1,890,000  on  July  10,  1998,  the  Partnership  received net sales
proceeds of $137,740, a mortgage  loan  receivable of $1,362,149 and recorded a
deferred gain on sale of $1,051,631.  The deferred gain will be recognized over
the life of the  related  mortgage  loan  receivable  as principal payments are
received, of which $1,051,631 has been recognized as of December 31, 1998.  The
mortgage loan receivable accrues interest at  9.5% per annum and has a maturity
date of July 1, 1999, at which time all accrued interest, as well as principal,
is due.  On December  18,  1998,  this  mortgage loan receivable was prepaid in
full.  The Partnership  received  $1,420,381  which represented the outstanding
principal balance plus accrued interest.







                                     -30-



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

                         Notes to Financial Statements
                                  (continued)


(7) Notes Payable to Affiliate

On May 1, 1996, the  Partnership  obtained  a  line  of credit from the General
Partner in the aggregate amount of  $1,000,000  to be used specifically for the
pre-development improvements on Parcel 15.  The Partnership was required to pay
a 1% loan fee to  the  General  Partner  as  money was funded. The note accrued
interest at 10.9%, and required a  principal  paydown of $150,000 on October 1,
1996, and thereafter Net Sales Proceeds from Parcel 15 were being applied first
to paydown the note. This note  had  an  original maturity date of May 1, 1997,
but had been extended to January 1, 1999  at the same interest rate. On May 27,
1998, this note was  paid  in  full  by  the  Partnership.  For the years ended
December 31, 1998 and 1997,  interest  of $7,544 and $36,579, respectively, was
capitalized, of which $0 and  $20,292  was  unpaid  as of December 31, 1998 and
1997, respectively. For the years ended  December  31, 1998 and 1997, loan fees
incurred and paid to the General Partner totaled $324 and $2,041, respectively,
and are included in investment in land and improvements.

On June 1, 1996, the  Partnership  obtained  a  line of credit from the General
Partner in the aggregate amount of  $3,000,000  to be used specifically for the
pre-development improvements on Parcel 1. The Partnership was required to pay a
1% loan fee to  the  General  Partner  as  money  was  funded. The note accrued
interest at 10.9%, and  Net  Sales  Proceeds  from  Parcel 1 were being applied
first to paydown the note. This  note  had  an original maturity date of May 1,
1997, but had been extended to February 1, 1998 at the same interest rate. With
the sale of the remaining acres  of  Parcel  1  on December 29, 1997, the buyer
assumed this note which had a balance  of $3,325,515 at that time. For the year
ended December 31, 1997, interest of $288,866 was capitalized and paid. For the
year ended December  31,  1997,  loan  fees  incurred  and  paid to the General
Partner  totaled  $13,790  and   are   included   in  investment  in  land  and
improvements. For  the  year  ended  December  31,  1997,  loan  extension fees
incurred and paid to the  General  Partner  totaled $21,280 and are included in
investment in land and improvements.

On May 12, 1997, the  Partnership  obtained  a  line of credit from the General
Partner in the aggregate amount  of  $744,000  to  be used specifically for the
pre-development improvements on Parcel 21.  The note accrued interest at 9.625%
and had a maturity date of  May  12,  1998. Interest-only payments on this note
were due quarterly and the  loan  could  have  been prepaid at any time without
penalty. On June 25, 1998, this note was assumed by the purchaser of Parcel 21.
The balance of  this  note  at  assumption  was  $394,623.  For the years ended
December 31, 1998 and 1997, interest  of $26,756 and $29,170, respectively, was
capitalized, of which $0 and  $29,170  was  unpaid  as of December 31, 1998 and
1997, respectively.







                                     -31-



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

                         Notes to Financial Statements
                                  (continued)


Through December 30, 1998, the General Partner had made additional loans to the
Partnership totaling $2,670,400.   Net  sales proceeds totaling $1,849,815 from
Parcels 1, 4, 12, 15, 20, 23, and  24 were previously retained and used to fund
pre-development activity on certain  of  the Partnership's land investments. In
July 1997, the Partnership distributed these  net sales proceeds by obtaining a
loan  from  the  General  Partner.    The  remainder  of  funds  loaned  to the
Partnership were for Partnership operations.   The note accrued interest at 10%
per annum and had a maturity date  of  January  1, 1999.  On December 30, 1998,
this note was paid in full  by  the  Partnership.  For the years ended December
31, 1998  and  1997,  interest  of  $263,428  and  $135,859,  respectively, was
capitalized, of which $114,266 and $134,850  was unpaid as of December 31, 1998
and 1997, respectively.

On December 31, 1998, the Partnership  obtained a loan from the General Partner
in the amount  of  $2,493,750  solely  collateralized  by  Parcel  5.  The note
accrues interest at 7.2% and has a maturity date of December 29, 2001.


(8) Subsequent Events

On January 29, 1999, the Partnership  sold  approximately 27 acres of Parcel 17
to an unaffiliated third  party  for  $500,000.    The Partnership received net
sales proceeds of $484,380 and recorded a gain on sale of $163,419.



























                                     -32-



Item 9.  Changes in and Disagreements  with  Independent Auditors on Accounting
         and Financial Disclosure

There were  no  disagreements  on  accounting  or  financial disclosure matters
during 1998.


                                   PART III


Item 10.  Directors and Executive Officers of the Registrant

The  General  Partner  of  the   Partnership,  Inland  Real  Estate  Investment
Corporation, was organized in 1984 for the purpose of acting as general partner
of limited partnerships formed  to  acquire,  own  and operate real properties.
The General Partner is a wholly-owned subsidiary  of The Inland Group, Inc.  In
1990, Inland Real Estate Investment  Corporation became the replacement General
Partner for an additional 301  privately-owned real estate limited partnerships
syndicated by Affiliates.    The  General  Partner  has  responsibility for all
aspects of the  Partnership's  operations.    The  relationship  of the General
Partner  to  its  Affiliates  is  described  under  the  caption  "Conflicts of
Interest" at pages 11 to 13 of  the  Prospectus, a copy of which description is
hereby incorporated herein by reference.


Officers and Directors

The officers, directors, and key  employees  of  The Inland Group, Inc. and its
Affiliates ("Inland") that are  likely  to  provide services to the Partnership
are as follows:


                               Functional Title

  Daniel L. Goodwin....... Chairman and Chief Executive Officer
  Robert H. Baum.......... Executive Vice President-General Counsel
  G. Joseph Cosenza....... Senior Vice President-Acquisitions
  Robert D. Parks......... Senior Vice President-Investments
  Norbert J. Treonis...... Senior Vice President-Property Management
  Brenda G. Gujral........ President and Chief Operating Officer-IREIC
  Catherine L. Lynch...... Treasurer
  Paul J. Wheeler......... Vice President-Personal Financial Services Group
  Roberta S. Matlin....... Assistant Vice President-Investments
  Mark Zalatoris.......... Assistant Vice President-Due Diligence
  Patricia A. Challenger.. Vice President-Asset Management
  Kelly Tucek............. Assistant Vice President-Partnership Accounting
  Venton J. Carlston...... Assistant Controller










                                     -33-



    DANIEL L. GOODWIN (age 55)   is  Chairman  of the Board of Directors of The
Inland Group, Inc.,  a  billion-dollar  real  estate and financial organization
located in Oak Brook,  Illinois.    Among  Inland's subsidiaries is the largest
property management firm in  Illinois  and  one  of the largest commercial real
estate and mortgage banking firms in the Midwest.

Mr. Goodwin has served as Director  of  the  Avenue  Bank  of Oak Park and as a
director of the Continental Bank of  Oakbrook  Terrace.  He was Chairman of the
Bank Holding Company of American National Bank  of DuPage.  Currently he is the
Chairman of the Board of Inland Mortgage Investment Corporation.

Mr. Goodwin has been in the  housing  industry  for more than 28 years, and has
demonstrated a lifelong interest in  housing-related  issues.  He is a licensed
real estate broker and a member  of  the National Association of Realtors.  Mr.
Goodwin has developed thousands of  housing  units in the Midwest, New England,
Florida, and the Southwest.  He  is  also the author of a nationally recognized
real estate reference book for the management of residential properties.

Mr. Goodwin has served on  the  Board  of the Illinois State Affordable Housing
Trust Fund for the past six years.   He is an advisor for the Office of Housing
Coordination Services of the State  of  Illinois,  and  a member of the Seniors
Housing Committee of the  National  Multi-Housing  Council.  Recently, Governor
Edgar appointed Mr. Goodwin as Chairman of the Housing Production Committee for
the Illinois State Affordable Housing Conference.    He also served as a member
of the Cook County  Commissioner's  Economic Housing Development Committee, and
he was the Chairman of the  DuPage  County  Affordable Housing Task Force.  The
1992 Catholic Charities Award  was  presented  to  Mr.  Goodwin for his work in
addressing affordable housing needs.   The  City  of Hope designated him as the
Man of the Year for the Illinois  construction industry.  In 1989,  the Chicago
Metropolitan  Coalition  on  Aging  presented  Mr.  Goodwin  with  an  award in
recognition of his  efforts  in  making  housing  more  affordable to Chicago's
Senior Citizens.  On May 4, 1995, PADS, Inc. (Public Action to Deliver Shelter)
presented Mr. Goodwin  with  an  award,  recognizing  The  Inland  Group as the
leading corporate provider of transitional  housing  for the homeless people of
DuPage County.  Mr. Goodwin also  serves  as Chairman of New Directions Housing
Corporation, a leading provider of affordable housing in northern Illinois.

Mr. Goodwin is a product  of  Chicago-area schools, and obtained his Bachelor's
and Master's Degrees  from  Illinois  Universities.    Following graduation, he
taught for five  years  in  the  Chicago  Public  Schools.    His commitment to
education has continued through his  work  with  the BBF Family Services' Pilot
Elementary School in  Chicago,  and  the  development  of the Inland Vocational
Training Center  for  the  Handicapped  located  at  Little  City  in Palatine,
Illinois.  He  personally  established  an  endowment  which  funds a perpetual
scholarship program for inner-city  disadvantaged  youth.   In 1990 he received
the Northeastern  Illinois  University  President's  Meritorious Service Award.
Mr. Goodwin  holds  a  Master's  Degree  in  Education  from  Northern Illinois
University, and in 1986, he was awarded an Honorary Doctorate from Northeastern
Illinois University College of Education.    More  than 12 years ago, under Mr.
Goodwin's direction, Inland instituted  a  program to educate disabled students
about the workplace.  Most  of  these  original  students are still employed at
Inland today, and Inland  continues  as  one  of  the  largest employers of the
disabled in DuPage County.  Mr. Goodwin has  served as a member of the Board of
Governors of Illinois State Colleges  and  Universities,  and he is currently a
trustee of Benedictine University.  He was elected Chairman of the Northeastern
Illinois University Board of Trustees in January 1996.


                                     -34-



In 1988 he received the  Outstanding  Business  Leader Award from the Oak Brook
Jaycees and in March 1994,  he  won  the  Excellence in Business Award from the
DuPage Area Association of Business and Industry.  Additionally, he was honored
with a dinner sponsored by Little  Friends  on  May 17, 1995 for rescuing their
Parent-Handicapped Infant Program  when  they  lost  their  lease.   He was the
recipient of the 1995 March  of  Dimes  Life Achievement Award and was recently
recognized as the 1998  Corporate  Leader  of  the  Year  by the Oak Brook Area
Association of Commerce and Industry.    The  Ray Graham Association for People
with Disabilities honored Mr. Goodwin as  the  1999  Employer of the Year.  For
many years, he  has  been  Chairman  of  the  National  Football League Players
Association Mackey Awards for the benefit  of inner-city youth and he served as
the  recent  Chairman  of  the   Speakers   Club   of  the  Illinois  House  of
Representatives.

    ROBERT H. BAUM (age  55)  has  been  with  The  Inland  Group, Inc. and its
affiliates since 1968 and is one of  the four original principals.  Mr. Baum is
Vice Chairman and Executive Vice President-General Counsel of The Inland Group,
Inc.  In his  capacity  as  General  Counsel,  Mr.  Baum is responsible for the
supervision  of  the  legal  activities  of  The  Inland  Group,  Inc.  and its
affiliates.  This responsibility  includes  the  supervision  of The Inland Law
Department and serving as liaison with outside counsel.  Mr. Baum has served as
a member  of  the  North  American  Securities  Administrators Association Real
Estate Advisory Committee and as a  member of the Securities Advisory Committee
to the Secretary  of  State  of  Illinois.    He  is  a  member of the American
Corporation Counsel Association and  has  also  been  a  guest lecturer for the
Illinois State Bar Association.   Mr. Baum has been admitted to practice before
the Supreme Court of the United States,  as well as the bars of several federal
courts of appeals and federal district  courts  and  the State of Illinois.  He
received his B.S. Degree from the  University  of Wisconsin and his J.D. Degree
from Northwestern University School of Law.   Mr. Baum has served as a director
of American National Bank  of  DuPage  and  currently  serves  as a director of
Westbank.  Mr. Baum  also  is  a  member  of  the Governing Council of Wellness
House, a charitable  organization  that  provides  emotional support for cancer
patients and their families. 

    G. JOSEPH COSENZA (age 55)  has  been  with  The Inland Group, Inc. and its
affiliates since 1968 and is one of  the four original principals.  Mr. Cosenza
is a Director  and  Vice  Chairman  of  The  Inland  Group,  Inc. and oversees,
coordinates and directs Inland's  many  enterprises.   In addition, Mr. Cosenza
immediately  supervises  a  staff  of  nine  persons  who  engage  in  property
acquisition.  Mr. Cosenza has been  a  consultant to other real estate entities
and lending institutions on property appraisal methods.

Mr. Cosenza received his B.A.  Degree from Northeastern Illinois University and
his M.S. Degree from  Northern  Illinois  University.    From  1967 to 1968, he
taught at the LaGrange School District  in  Hodgkins, Illinois and from 1968 to
1972, he served as  Assistant  Principal  and  taught in the Wheeling, Illinois
School District.  Mr. Cosenza has been a licensed real estate broker since 1968
and an active member of  various  national  and local real estate associations,
including the National Association of Realtors and the Urban Land Institute.

Mr. Cosenza has also been Chairman  of  the  Board of American National Bank of
DuPage, and has  served  on  the  Board  of  Directors  of  Continental Bank of
Oakbrook Terrace.  He  is  presently  a  Director  on  the Board of Westbank in
Westchester and Hillside, Illinois.


                                     -35-



    ROBERT D. PARKS  (age  55)    is  a  Director  of  The  Inland Group, Inc.,
President,  Chairman  and  Chief  Executive   Officer  of  Inland  Real  Estate
Investment Corporation and President,  Chief Executive Officer, Chief Operating
Officer and Affiliated Director of Inland Real Estate Corporation.

Mr. Parks is responsible for  the ongoing administration of existing investment
programs,  corporate  budgeting  and  administration  for  Inland  Real  Estate
Investment Corporation.   He  oversees  and  coordinates  the  marketing of all
investments and investor relations. 

Prior to joining Inland, Mr.  Parks  was  a  school teacher in Chicago's public
schools.  He received his B.A. degree from Northeastern Illinois University and
his M.A. degree from the University  of  Chicago.    He is a member of the Real
Estate Investment Association and a member of NAREIT.

    NORBERT J.  TREONIS  (age  48)    joined  The  Inland  Group,  Inc. and its
affiliates in 1975 and he is  currently Chairman and Chief Executive Officer of
The Inland Property Management Group, Inc.  and a Director of The Inland Group,
Inc.  He serves on the  Board  of Directors of all Inland subsidiaries involved
in the  property  management,  acquisitions  and  maintenance  of  real estate,
including   Mid-America    Property    Management   Corporation,   Metropolitan
Construction Services, Inc.  and  Inland  Commercial  Property Management, Inc.
Mr. Treonis is charged with  the  responsibility  of the overall management and
leasing of all apartment  units,  retail,  industrial and commercial properties
nationwide.

Mr. Treonis is a licensed real estate broker.  He is a past member of the Board
of Directors of American National Bank of DuPage, the Apartment Building Owners
and  Managers  Association,   the   National   Apartment  Association  and  the
Chicagoland Apartment Association.

    BRENDA G. GUJRAL  (age  56)  is  President  and  Chief Operating Officer of
Inland Real Estate Investment  Corporation  (IREIC),  the parent company of the
Advisor.  She is  also  President  and  Chief  Operating Officer of the Dealer-
Manager, Inland Securities Corporation  (ISC),  a  member  firm of the National
Association of Securities Dealers (NASD).

Mrs. Gujral has overall responsibility  for  the operations of IREIC, including
the distribution  of  checks  to  over  50,000  investors,  review  of periodic
communications to those investors, the  filing  of quarterly and annual reports
for Inland's publicly registered  investment  programs  with the Securities and
Exchange Commission, compliance with other  SEC and NASD securities regulations
both for IREIC and ISC,  review  of  asset management activities, and marketing
and communications with  the  independent  broker/dealer firms selling Inland's
current and prior programs.  Mrs.  Gujral works with internal and outside legal
counsel in structuring and registering  the prospectuses for IREIC's investment
programs.

Mrs. Gujral has been with  Inland  for  18  years, becoming an officer in 1982.
Prior to joining  Inland,  she  worked  for  the  Land  Use Planning Commission
establishing an office in Portland,  Oregon,  to implement land use legislation
for that state.

She is a graduate of California State  University.   She holds Series 7, 22, 39
and 63 licenses from the NASD  and  is  a member of the National Association of
Real Estate Investment Trusts (NAREIT)  and  the National Association of Female
Executives.


                                     -36-



    CATHERINE L. LYNCH (age 40) joined  Inland  in 1989 and is the Treasurer of
Inland Real  Estate  Investment  Corporation.    Ms.  Lynch  is responsible for
managing the Corporate Accounting  Department.    Prior  to joining Inland, Ms.
Lynch worked in the  field  of  public  accounting  for KPMG Peat Marwick since
1980.    She  received  her  B.S.  degree  in  Accounting  from  Illinois State
University.  Ms. Lynch is  a  Certified  Public  Accountant and a member of the
American  Institute  of  Certified  Public  Accountants  and  the  Illinois CPA
Society.  She is registered with the National Association of Securities Dealers
as a Financial Operations Principal.

    PAUL J. WHEELER (age  46)    joined  Inland  in  1982  and is currently the
President of Inland Real Estate Equities,  Inc., the entity responsible for all
corporately owned  real  estate.    Mr.  Wheeler  received  his  B.A. degree in
Economics from  DePauw  University  and  an  M.B.A.  in Finance/Accounting from
Northwestern University.   Mr.  Wheeler  is  a  Certified Public Accountant and
licensed real estate broker.    For  three  years  prior to joining Inland, Mr.
Wheeler was Vice President/Finance at the real estate brokerage firm of Quinlan
& Tyson, Inc.

    ROBERTA S. MATLIN (age 54)   joined  Inland in 1984 as Director of Investor
Administration  and  currently  serves  as  Senior  Vice President-Investments.
Prior to that, Ms. Matlin spent 11  years with the Chicago Region of the Social
Security Administration of the  United  States  Department  of Health and Human
Services.  She is  a  Director  of  Inland  Real Estate Investment Corporation,
Inland Securities Corporation, and  Inland  Real Estate Advisory Services, Inc.
As Senior  Vice  President-Investments,  she  directs  the  day-to-day internal
operations of the General Partner.    Ms.  Matlin received her B.A. degree from
the University of Illinois.  She is registered with the National Association of
Securities Dealers, Inc. as a General Securities Principal.

    MARK ZALATORIS (age 41) joined Inland  in 1985 and currently serves as Vice
President of Inland Real  Estate  Investment Corporation.  His responsibilities
include the coordination of due  diligence activities by selling broker/dealers
and is also involved  with  limited  partnership asset management including the
mortgage funds.  Mr.  Zalatoris  is  a  graduate  of the University of Illinois
where he received  a  Bachelors  degree  in  Finance  and  a  Masters degree in
Accounting and Taxation.   He  is  a  Certified  Public  Accountant and holds a
General Securities License with Inland Securities Corporation.

    PATRICIA A. CHALLENGER (age  46)  joined  Inland  in  1985.  Ms. Challenger
serves as Senior Vice President of Inland Real Estate Investment Corporation in
the area of Asset Management.  As  head of the Asset Management Department, she
develops  operating  and   disposition   strategies  for  all  investment-owned
properties.    Ms.  Challenger  received  her  Bachelor's  degree  from  George
Washington University and  her  Master's  from  Virginia  Tech University.  Ms.
Challenger was selected and  served  from  1980-1984 as Presidential Management
Intern, where she was part of a special government-wide task force to eliminate
waste, fraud and abuse  in  government  contracting  and  also served as Senior
Contract Specialist  responsible  for  capital  improvements  in 109 government
properties.  Ms. Challenger is  a  licensed real estate broker, NASD registered
securities sales representative and is a member of the Urban Land Institute. 






                                     -37-



    KELLY TUCEK (age  36)  joined  Inland  in  1989  and  is  an Assistant Vice
President of Inland Real Estate Investment Corporation.  As of August 1996, Ms.
Tucek is responsible for  the  Investment  Accounting Department which includes
all public partnership accounting functions along with quarterly and annual SEC
filings.  Prior to joining Inland, Ms.  Tucek was on the audit staff of Coopers
and Lybrand since  1984.    She  received  her  B.A.  Degree  in Accounting and
Computer Science from North Central College.

    VENTON J. CARLSTON (age 41)    joined  Inland  in 1985 and is the Assistant
Controller of Inland Real Estate Investment Corporation where he supervises the
corporate  bookkeeping  staff  and   is  responsible  for  financial  statement
preparation and budgeting for Inland Real Estate Investment Corporation and its
subsidiaries.    Prior  to  joining  Inland,  Mr.  Carlston  was  a partnership
accountant with JMB Realty.   He  received  his  B.S. degree in Accounting from
Southern Illinois University.   Mr.  Carlston  is a Certified Public Accountant
and a member of the Illinois CPA  Society.   He is registered with the National
Association of Securities Dealers, Inc. as a Financial Operations Principal.








































                                     -38-



Item 11.  Executive Compensation

The General Partner is entitled to receive a share of cash distributions of Net
Sales Proceeds based  upon  both  an  aggregate  overall  return to the Limited
Partners and a separate return with respect to each parcel of land purchased by
the Partnership as described under the caption "Cash Distributions" and a share
of profits or losses as described  under  the caption "Allocation of Profits or
Losses" at  page  38  of  the  Prospectus,  and  at  pages  A-6  to  A-9 of the
Partnership Agreement, included as  an  exhibit  to  the  Prospectus, a copy of
which descriptions is incorporated herein by reference.

The Partnership  is  permitted  to  engage  in  various  transactions involving
Affiliates of the General Partner  of  the  Partnership, as described under the
captions "Compensation and Fees" at  pages  7-9  and "Conflicts of Interest" at
pages 9-11 of the Prospectus, and at pages A-10 through A-19 of the Partnership
Agreement, included as  an  exhibit  to  the  Prospectus,  a  copy  of which is
incorporated herein by reference. The  relationship of the General Partner (and
its directors and officers) to its Affiliates is set forth above in Item 10.

The General Partner and its Affiliates  may be reimbursed for their expenses or
out-of-pocket costs relating to the  administration of the Partnership. For the
year ended December 31, 1998,  such  costs  were  $70,242, of which $65,066 was
unpaid as of December 31, 1998.

The General Partner was entitled  to  receive  an Asset Management Fee equal to
one-quarter of 1% of the original  cost  to the Partnership of undeveloped land
annually, limited to a cumulative total over  the life of the Partnership of 2%
of the land's original cost  to  the  Partnership.    As  of June 30, 1998, the
Partnership had met this limit.    For  the  year  ended December 31, 1998, the
Partnership incurred $25,858 in  Asset  Management  Fees,  of which $81,136 was
unpaid as of December 31, 1998.

An  Affiliate  of  the  General  Partner  performed  marketing  and advertising
services for the Partnership and  was  reimbursed  (as set forth under terms of
the Partnership Agreement) for direct  costs.  For  the year ended December 31,
1998, the Partnership incurred  $90,279  of  such  costs,  of which $14,829 was
unpaid as of December 31, 1998.

An Affiliate of  the  General  Partner  performed  property upgrades, rezoning,
annexation and other activities  to  prepare the Partnership's land investments
for sale and  was  reimbursed  (as  set  forth  under  terms of the Partnership
Agreement) for salaries and direct costs. For the year ended December 31, 1998,
the Partnership incurred $188,506 of such  costs, of which $114,266 was unpaid,
and included in the investments in land  and improvements.   As of December 31,
1998, notes payable  to  Affiliate  totaled  $2,493,750.    For  the year ended
December 31, 1998, interest of $297,728  was capitalized, of which $114,266 was
unpaid as of December 31, 1998.  The  Partnership was required to pay a 1% loan
fee to the General Partner on  lines  of  credit  as money was funded.  For the
year ended December 31, 1998,  loan  fees  paid  to the General Partner totaled
$324, all of which  have  been  paid  and  included  in  investment in land and
improvements.






                                     -39-



Item 12. Security Ownership of Certain Beneficial Owners and Management

  (a) No person or group is known  by  the Partnership to own beneficially more
      than 5% of the outstanding Units of the Partnership

  (b) The officers and directors of the  General Partner of the Partnership own
      as a group the following Units of the Partnership:


                                Amount and Nature        
                                 of Beneficial              Percent
       Title of Class              Ownership                of Class   
       --------------           ----------------         --------------
       Limited Partnership    267 Units directly          Less than 1%
       Units


      No  officer  or  director  of  the  General  Partner  of  the Partnership
      possesses a  right  to  acquire  beneficial  ownership  of  Units  of the
      Partnership.

      All of the outstanding shares  of  the General Partner of the Partnership
      are owned by an  Affiliate  or  its  officers  and directors as set forth
      above in Item 10.

  (c) There exists no arrangement, known  to  the Partnership, the operation of
      which may at a  subsequent  date  result  in  a  change in control of the
      Partnership.


Item 13. Certain Relationships and Related Transactions

There were  no  significant  transactions  or  business  relationships with the
General Partner, Affiliates or their  management  other than those described in
Items 10 and 11 above.  Reference is  made  to Note 3 of the Notes to Financial
Statements (Item 8 of  this  Annual  Report)  for information regarding related
party transactions.




















                                     -40-



                                    PART IV


Item 14.  Exhibits, Financial Statement Schedules, and Reports on Form 8-K

  (a) The financial statements listed in  the  index  at page 13 of this Annual
      Report are filed as part of this Annual Report.

  (b) Exhibits. The following documents are filed as part of this report:

      3 Restated Certificate of  Limited  Partnership  and amended and restated
      Agreement of Limited Partnership,  included  as  Exhibits  A and B of the
      Prospectus dated  October  12,  1988  as  supplemented,  are incorporated
      herein by reference thereto.

      4  Form  of  Certificate  of  Ownership  representing  interests  in  the
      registrant filed as Exhibits 4(a)  and  4(b) to Registration Statement on
      Form  S-11,  File  No.  33-18607,  is  incorporated  herein  by reference
      thereto.

      28 Prospectus, to Form S-11 Registration Statement, File No. 33-18607, as
      filed  with  Securities  Exchange  Commission  on  October  12,  1988, as
      supplemented to date, is incorporated herein by reference thereto.


  (c) Financial Statement Schedules.

      All  schedules  have  been   omitted   as  the  required  information  is
      inapplicable or the information is  presented in the financial statements
      or related notes.


  (d) Reports on Form 8-K:

      None.


No Annual Report or proxy  material  for  the  year  1998  has been sent to the
Partners of the Partnership.   An  Annual  Report  will be sent to the Partners
subsequent to this  filing  and  the  Partnership  will  furnish copies of such
report to the Commission when it is sent to the Partners.
















                                     -41-



                                  SIGNATURES

Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange
Act of 1934, the Registrant has  duly  caused  this  report to be signed on its
behalf by the undersigned, thereunto duly authorized.

                            INLAND LAND APPRECIATION FUND, L.P.
                            Inland Real Estate Investment Corporation
                            General Partner

                                  /s/ Robert D. Parks

                            By:   Robert D. Parks
                                  Chairman of the Board
                                  and Chief Executive Officer
                            Date: March 29, 1999

Pursuant to the  requirements  of  the  Securities  Exchange  Act of 1934, this
report has  been  signed  below  by  the  following  persons  on  behalf of the
Registrant and in the capacities and on the dates indicated:

                            By:   Inland Real Estate Investment Corporation
                                  General Partner

                                  /s/ Robert D. Parks

                            By:   Robert D. Parks
                                  Chairman of the Board
                                  and Chief Executive Officer
                            Date: March 29, 1999

                                  /s/ Patricia A. Challenger

                            By:   Patricia A. Challenger
                                  Senior Vice President
                            Date: March 29, 1999

                                  /s/ Kelly Tucek

                            By:   Kelly Tucek
                                  Principal Financial Officer
                                  and Principal Accounting Officer
                            Date: March 29, 1999

                                  /s/ Daniel L. Goodwin

                            By:   Daniel L. Goodwin
                                  Director
                            Date: March 29, 1999

                                  /s/ Robert H. Baum

                            By:   Robert H. Baum
                                  Director
                            Date: March 29, 1999


                                     -42-