<PAGE>   1


                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D. C. 20549

                                    FORM 10-Q

                                   (Mark One)
[X]              Quarterly Report Under Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

or

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

                  for Quarterly Period Ended SEPTEMBER 30, 2000
                         Commission file number 33-30312


                INTERSTATE LAND INVESTORS II LIMITED PARTNERSHIP


             NORTH CAROLINA                          56-1681116
    (State or other jurisdiction of               (I.R.S. Employer
     incorporation or organization)              Identification No.)

                              IJL FINANCIAL CENTER
                                 P. O. BOX 1012
                            CHARLOTTE, NC 28201-1012
                    (Address of principal executive offices)
                                   (Zip Code)

                                 (704) 379-9164
              (Registrant's telephone number, including area code)

                                 NOT APPLICABLE
              (Former name, former address and former fiscal year,
                         if changed since last report)

Indicate by check mark whether the Registrant has (1) filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding twelve 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 the number of shares outstanding of each of the issuer's classes of
common stock as of the latest practicable date.

        7,650 limited partnership units outstanding at November 10, 2000

                    Page 1 of 9 Sequentially Numbered Pages


<PAGE>   2

                INTERSTATE LAND INVESTORS II LIMITED PARTNERSHIP


                            CONDENSED BALANCE SHEETS
                 AS OF SEPTEMBER 30, 2000 AND DECEMBER 31, 1999

<TABLE>
<CAPTION>
                                                                     September 30,
                                                                          2000             December 31,
                                                                      (Unaudited)              1999
                                                                   -------------------   ------------------
<S>                                                                        <C>                  <C>

     ASSETS:

Land Held for Sale                                                         $6,450,000           $6,450,000
Cash and Cash Equivalents                                                       5,485                3,443
Other                                                                          39,493               39,493
                                                                   -------------------   ------------------

                                                                           $6,494,977           $6,492,936
                                                                   ===================   ==================




     LIABILITIES AND PARTNERS' EQUITY (DEFICIT):

Accrued Liabilities                                                           229,285             $214,164
Note Payable                                                                  212,754              194,754
                                                                   -------------------   ------------------

                                                                              442,039              408,918
                                                                   -------------------   ------------------



Class A Limited Partners' Interest                                          6,053,011            6,084,088
Subordinated Limited Partners' Interest                                            85                   85
General Partners' Interest                                                       (158)                (155)
                                                                   -------------------   ------------------

                                                                            6,052,938            6,084,018
                                                                   -------------------   ------------------

                                                                           $6,494,977           $6,492,936
                                                                   ===================   ==================
</TABLE>

            See attached notes to the condensed financial statements

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<PAGE>   3

                INTERSTATE LAND INVESTORS II LIMITED PARTNERSHIP

                       CONDENSED STATEMENTS OF OPERATIONS


<TABLE>
<CAPTION>
                                                      Three              Three               Nine               Nine
                                                      Months             Months             Months             Months
                                                      Ended              Ended              Ended              Ended
                                                  September 30,      September 30,      September 30,      September 30,
                                                       2000               1999               2000               1999
                                                   (Unaudited)        (Unaudited)        (Unaudited)        (Unaudited)
                                                 -----------------  -----------------  -----------------  -----------------
<S>                                                       <C>                <C>               <C>                <C>

INCOME:
  Interest Income                                             $43                $38               $103                $80
                                                 -----------------  -----------------  -----------------  -----------------
                                                               43                 38                103                 80

EXPENSES:
  Property Taxes                                                0                  0                 94                 94
  Insurance Expense                                             0                  0                354                356
  Professional and Legal Fees                                 256                 32              8,513              7,937
  General and Administrative Costs                          3,198              1,527              7,195              6,404
  Interest Expense                                          5,959              5,376             15,027             13,560
                                                 -----------------  -----------------  -----------------  -----------------
                                                            9,413              6,934             31,183             28,351

NET LOSS                                                  ($9,370)           ($6,896)          ($31,080)          ($28,271)
                                                 =================  =================  =================  =================


NET LOSS ALLOCATION:

General Partners                                              ($1)               ($1)               ($3)               ($3)
Class A Limited Partners                                   (9,369)            (6,896)           (31,077)           (28,269)
                                                 -----------------  -------------------------------------------------------
                                                           (9,370)            (6,896)           (31,080)           (28,271)
                                                 =================  =======================================================



CLASS A LIMITED PARTNERSHIP
 UNITS OUTSTANDING                                          7,650              7,650              7,650              7,650
                                                 -----------------  -----------------  -----------------  -----------------

NET LOSS PER CLASS A UNIT                                  ($1.22)            ($0.90)            ($4.06)            ($3.70)
                                                 =================  =================  =================  =================
</TABLE>

            See attached notes to the condensed financial statements


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<PAGE>   4

                INTERSTATE LAND INVESTORS II LIMITED PARTNERSHIP

               CONDENSED STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
              FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2000 AND 1999

                                   (Unaudited)


<TABLE>
<CAPTION>
                                                                                      Subordinated
                                                     General          Limited           Limited
                                                    Partners          Partners          Partner           Total
                                                 ---------------- ----------------- ---------------- -----------------
<S>                                                        <C>          <C>                     <C>        <C>

Partners' Equity (Deficit)
  at December 31, 1998                                     ($141)       $6,217,905              $88        $6,217,852

Net Loss for the Nine Months
  Ended September 30, 1999                                    (3)          (28,269)               0           (28,271)
                                                 ---------------- ----------------- ---------------- -----------------


Partners' Equity (Deficit)
  at September 30, 1999                                    ($144)       $6,189,636              $88        $6,189,581
                                                 ================ ================= ================ =================




Partners' Equity (Deficit)
  at December 31, 1999                                     ($155)       $6,084,088              $85        $6,084,018

Net Loss for the Nine Months
  Ended September 30, 2000                                    (3)          (31,077)               0           (31,080)
                                                 ---------------- ----------------- ---------------- -----------------


Partners' Equity (Deficit)
  at September 30, 2000                                    ($158)       $6,053,011              $85        $6,052,938
                                                 ================ ================= ================ =================
</TABLE>

            See attached notes to the condensed financial statements


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<PAGE>   5

                INTERSTATE LAND INVESTORS II LIMITED PARTNERSHIP

                       CONDENSED STATEMENTS OF CASH FLOWS
              FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2000 AND 1999


<TABLE>
<CAPTION>
                                                                    Nine Months            Nine Months
                                                                       Ended                  Ended
                                                                   September 30,          September 30,
                                                                       2000                    1999
                                                                    (Unaudited)            (Unaudited)
                                                                 ------------------     -------------------
<S>                                                                       <C>                     <C>

CASH FLOW FROM OPERATING ACTIVITIES:

Net Loss                                                                  ($31,080)               ($28,271)

Adjustments to reconcile net loss to net
 cash used for operations:

 Increase in Property Taxes Payable                                             94                      94
 Increase in Accrued Liabilities                                            15,027                   5,883
                                                                 ------------------     -------------------

 Net Cash Used for Operating Activities                                    (15,959)                (22,294)
                                                                 ------------------     -------------------


CASH FLOWS FROM FINANCING ACTIVITIES:

 Increase in Note Payable                                                   18,000                   4,345
                                                                 ------------------     -------------------

 Net Cash Provided by Financing Activities                                  18,000                   4,345
                                                                 ------------------     -------------------

 Increase in Cash and Cash Equivalents                                       2,042                     413

Cash and Cash Equivalents at Beginning
 of Period                                                                   3,443                     849
                                                                 ------------------     -------------------

Cash and Cash Equivalents at End of Period                                  $5,485                  $1,262
                                                                 ==================     ===================
</TABLE>

            See attached notes to the condensed financial statements


                                       5
<PAGE>   6

                INTERSTATE LAND INVESTORS II LIMITED PARTNERSHIP

               NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
                               SEPTEMBER 30, 2000

1.   BASIS OF PRESENTATION

The accompanying unaudited condensed financial statements have been prepared in
accordance with generally accepted accounting principles for interim financial
information and the instructions to Form 10-Q and Article 10 of Regulation S-X.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included.
Operating results for the nine month period ended September 30, 2000, are not
necessarily indicative of the results that may be expected for the year to end
December 31, 2000.


2.   ORGANIZATION

Interstate Land Investors II Limited Partnership ("Registrant" or "Partnership")
is a North Carolina limited partnership. The Partnership filed registration
statements in 1989 and 1990 and offered the sale of the limited partnership
interests to persons who were admitted as limited partners. The initial offering
became effective September 29, 1989, and was terminated November 3, 1989. The
post effective amendment was filed in August 1990, approved in November 1990,
and closed November 30, 1990. Capital contributions of $100 were received from
the general partners and $7,650,000 from the limited partners. The limited
partnership units were sold in $1,000 units. On November 10, 2000, there were
775 unit holders of record. The Partnership's business now consists of holding
for investment, disposing and otherwise dealing in 145 acres of undeveloped land
("the Property") located in York County, South Carolina. As of September 30,
2000, the Partnership held all 145 acres of the Property.

ITEM 2--MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

1.   LIQUIDITY AND CAPITAL RESOURCES

As of September 30, 2000, the Registrant had $5,485 on hand in the form of cash
and cash equivalents. The Registrant increased its funding available under its
note payable to the General Partner to $212,754. This note will provide any
additional funds needed for working capital and will extend through the term of
the partnership, accruing interest at prime plus one percent.

Until the Registrant disposes of the Property, its only sources of additional
capital are additional loans and proceeds from the sale of resources (i.e.,
timber) on the property.


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2.   RESULTS OF OPERATIONS

For the nine months ended September 30, 2000, the Partnership reported a net
loss of $31,080 as compared to a net loss of $28,271 for the nine months ended
September 30, 1999.

The Registrant incurred total expenses of $31,183 for the nine month period,
compared to $28,351 for the same period in 1999. Interest expense accrued on the
higher balance of the note payable was up $1,467 from the same period in 1999.
General and administrative expenses were up $791 for the nine months ended
September 30, 2000 from the same period in 1999, which reflects the cost of
ballot mailings and property appraisal costs. Professional and legal expenses
increased by $576 for the nine months ended September 30, 2000. Legal fees are
higher due to the fees incurred for review of documents pertaining to the
proposed sale of the property.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

         None.

ITEM 2. CHANGES IN SECURITIES

         None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

         None.

ITEM 4. SUBMISSIONS OF MATTERS TO A VOTE OF SECURITIES HOLDERS

         On July 10, 2000, ballots were sent to the limited partners requesting
their vote in favor of the proposed sale of the property to Greenfield
Development Company, LLC. A majority of the limited partners voted their
approval of the proposed sale.



                                       7
<PAGE>   8

ITEM 5. OTHER INFORMATION.

         On October 31, 1998, the Partnership entered into a listing agreement
with The Crosland Group to sell the property. The property is listed for sale at
$8,866,000 in aggregate. In December 1999, the Partnership entered into a
contract to sell the property for approximately $6,600,000. However, on March
17, 2000, Crescent Resources, the potential purchaser, canceled the contract.

On June 29, 2000, the Partnership entered into a contract with Greenfield
Development Company, LLC, to sell approximately 97 acres of the land for
approximately $4,165,000, which is $45,000 per acre (assuming that the total
wetlands acreage does not exceed 6 acres). The potential purchaser deposited
$50,000 earnest money with a title agency. Under the terms of the contract, the
potential purchaser has 90 days from the date that the limited partners vote
their majority agreement to the sale, to complete their due diligence. Limited
partners have voted their majority as of this filing. Notice of limited partner
majority vote approving the sale was given on August 7, 2000. The contract also
includes the purchase of approximately 97 acres of land owned by Interstate Land
Investors I. A majority of the investors in that Partnership have approved the
sale. The contract closing date is 30 days after completion of the due diligence
period, which would have made the probable closing date on December 6, 2000.
However, Greenfield has requested two 90-day extension periods, with additional
earnest money being deposited for each extension, making the first possible new
closing date March 6, 2001, and, if necessary, the second possible closing date
June 6, 2001.

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

         (a)      Exhibits

                  EX-27             FINANCIAL DATA SCHEDULE  (FOR SEC USE ONLY)

         (b)      Reports on Form 8-K

                  No reports on Form 8-K were required to be filed during the
                  nine months ended September 30, 2000.



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                INTERSTATE LAND INVESTORS II LIMITED PARTNERSHIP

                                    SIGNATURE


Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.



                                     INTERSTATE LAND INVESTORS II
                                     LIMITED PARTNERSHIP

                                     By:      ISC REALTY CORPORATION
                                              As Principal Executive Officer,
                                              Principal Financial Officer, and
                                              Principal Accounting Officer of
                                              the Registrant



                                     By:      /S/ J. Christopher Boone
                                              ------------------------
                                              J. Christopher Boone
                                              President

Date:    November 17, 2000
         -----------------





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