October 31, 1998

		QUARTERLY REPORT TO THE LIMITED PARTNERS
			OF DSI REALTY INCOME FUND VIII


DEAR LIMITED PARTNERS:

We  are  pleased  to  enclose  the  Partnership's  unaudited  financial
statements  for  the  period  ended  September 30, 1998.  The following is 
Management's  discussion  and  analysis  of  the  Partnership's  financial 
condition  and  results  of  its  operations.

For  the  three-month periods ended September 30, 1998  and  1997, total 
revenues increased 11.6% from $430,542 to $480,504 and total expenses increased
7.7% from $285,306 to $307,377.  Equity in income of the real estate joint
venture increased 28.8% from $24,611 to $31,688.  As a result, net income
increased 20.6% from $169,847 to $204,815 for the three-month period ended
September 30, 1998, as compared to the same period in 1997.  Rental revenue
increased as a result of higher unit rental rates.  Occupancy levels for the
Partnership's five mini-storage facilities averaged 85.3% for the three month
period ended September 30, 1998 as compared to 86.8% for the same period in
1997.  The Partnership is continuing its marketing efforts to attract and keep
new tenants in its various mini-storage mini-storage facilities.  Operating
expenses increased approximately $18,200 (7.3%) primarily as a result of higher
real estate tax expenses and property management fees, partially offset by
lower yellow pages advertising costs.  Property management fees, which are
based on rental income, increased as a result of the increase in rental revenue.
General and administrative expenses increased approximately $3,900 (10.4%)
primarily as a result of higher incentive management.  Incentive management
fees, which are based on cash available for distribution, increased as a result
of the increase in net income.  Equity in income from the real estate joint
venture increased primarily as a result of higher rental revenue.

For the nine-month periods ended September 30, 1998, and 1997, total revenues
increased 12.6% from $1,273,012 to $1,433,539 and total expenses increased 2.3%
from $923,026 to $944,571.  Equity in income of the real estate joint venture
increased 25.7% from $66,421 to $83,512.  As a result, net income increased
37.5% from $416,407 to $572,480 for the nine-month period ended September 30,
1998, as compared to the same period in 1997.  Rental revenue increased as a
result of higher unit rental rates.  Operating expenses increased approximately
$3,100 (0.4%) primarily as a result of increases in real estate tax expenses
and property management fees, partially offset by decreases yellow pages
advertising costs and legal expenses.  Property management fees, which are
based on rental income, increased as a result of the increase in rental
revenue.  General and administrative expenses increased approximately $18,400
(13.0%) primarily as a result of higher incentive management fees, which was
discussed above.  Equity in income from the real estate joint venture increased
as a result of higher rental revenue and lower yellow pages advertising costs
and salaries and wage expenses.

The City of Stockton acquired 6,089 square feet or 5.4% of the Stockton
property in 1997.  In April 1998 the Partnership received $65,000 as 
compensation for the acquisition.  A gain on sale of land was recorded in
the amount of $46,974, and the cost of land was reduced by $18,026.  Based
on operations since the disposition, neither cash flow from nor the value
of the remaining property appears materially impaired.

The  General  Partners will  continue  their  policy  of  funding improvements 
and maintenance of Partnership  properties  with  cash  generated from 
operations.  The  Partnership's financial resources  appear  to be adequate  
to meet its needs.  The  General Partners anticipate distributions to Limited 
Partners  to  remain  at  the  current  level  for  the  foreseeable  future.

The Year 2000 issue refers to the inability of certain computer systems to
recognize a date using "00" as the Year 2000.  The Partnership has implemented
a Year 2000 program, which has three phases: (1) identification;
(2) remediation; and (3) testing and verification.  The Partnership, as well
as the property management company and the Partnership's warehouse facilities
have completed those phases.  Computer programs have been upgraded and tested
to function properly with respect to the dates in the Year 2000 and thereafter.
Year 2000 compliance costs are nominal and have been expensed in the regular
course of business.  The Partnership provides no assurance that third-party
suppliers and customers will be compliant.  Nevertheless, the Partnership does
not beiieve that the Year 2000 issue will have a material adverse effect on
its financial condition or results of operations.

We are not enclosing a copy of the Partnership Form 10-Q as filed with the 
Securities and Exchange Commission since all the information set forth 
therein is contained either in this letter or in the attached financial 
statements. However, if you wish to receive a copy of said report, please 
send a written request to DSI Realty Income Fund VIII, P.O. Box 357, Long 
Beach, California 90801. 

                              Very truly yours,

                              DSI REALTY INCOME FUND VIII
                              By: DSI Properties, Inc., as
                              General Partner



                              By  /s/ Robert J. Conway
                                  ____________________________
                                 ROBERT J. CONWAY, President