UNITED STATES
                SECURITIES AND EXCHANGE COMMISSION
                      WASHINGTON, DC.  20549
                                 
                             FORM 10-Q
                                 
(Mark One)

[X]  QUARTERLY  REPORT PURSUANT TO SECTION  13  OR  15(d)  OF  THE
SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended      September 30, 1996
                              ------------------------------------        
                                or

[   ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR  15(d)  OF  THE
SECURITIES EXCHANGE ACT OF 1934

For the transition period from                  to
                               -----------------  ----- ----------
Commission file number                 0-14934
                      --------------------------------------------
                          DIVERSIFIED HISTORIC INVESTORS
------------------------------------------------------------------
      (Exact name of registrant as specified in its charter)

       Pennsylvania                                 23-2312037
-------------------------------              ---------------------
(State or other jurisdiction of              (I.R.S. Employer
incorporation or organization                Identification No.)

       Suite 500, 1521 Locust Street, Philadelphia, PA   19102
------------------------------------------------------------------
(Address of principal executive offices)               (Zip Code)

Registrant's telephone number, including area code  (215) 735-5001
                                                  ----------------
                              N/A
------------------------------------------------------------------
  (Former name, former address and former fiscal year, if changed
                        since last report)

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        No   X
                                        -------   -------
<PAGE>
                  PART I - FINANCIAL INFORMATION

Item 1.        Financial Statements.

             Consolidated Balance Sheets - September 30, 1996
             (unaudited) and December 31, 1995
             Consolidated Statements of Operations - Three Months
             and Nine Months Ended September 30, 1996 and 1995
             (unaudited)
             Consolidated Statements of Cash Flows - Nine Months
             Ended September 30, 1996 and 1995 (unaudited)
             Notes to Consolidated Financial Statements
             (unaudited)

Item 2.        Management's Discussion and Analysis of
               Financial Condition and Results of Operations.

(1)    Liquidity

                     At September 30, 1996, Registrant had cash of
approximately $3,569.  Such funds are expected to be used  to  pay
liabilities  of  Registrant  and to  fund  cash  deficits  of  the
properties.   Cash generated from operations is used primarily  to
fund operating expenses and debt service.  If cash flow proves  to
be insufficient, the Registrant will attempt to negotiate with the
various  lenders  in order to remain current on  all  obligations.
The  Registrant  is  not  aware  of  any  additional  sources   of
liquidity.

                     As  of  September  30, 1996,  Registrant  had
restricted cash of $75,803 consisting primarily of funds  held  as
security deposits, replacement reserves and escrows for taxes.  As
a consequence of these restrictions as to use, Registrant does not
deem  these funds to be a source of liquidity.  Should  the  first
mortgage holder of the eleven units at Smythe Stores be successful
in  its  attempts  to  foreclose, it is not  expected  to  have  a
significant  impact on the Registrant's liquidity, as these  units
have generated little or no positive cash flow.  See Part II, Item
1 for additional information.

                     In  recent years the Registrant has  realized
significant  losses, including the foreclosure of five properties,
due  to the properties' inability to generate sufficient cash flow
to  pay their operating expenses and debt service.  The Registrant
currently  owns  three properties at the present  time,  with  the
exception  of  the  eleven  units  at  Smythe  Stores,  where  the
Registrant will either be able to negotiate a loan modification or
the  units  will be foreclosed, the Registrant has  feasible  loan
modifications  in  place  on its properties.   However,  the  loan
modifications have resulted in the mortgage loans encumbering  the
property  thus becoming "cash-flow" mortgages, requiring that  all
available cash after payment of operating expenses must be paid to
the  first  mortgage  holder as debt service.   Therefore,  it  is
unlikely that any cash will be available to the Registrant to  pay
its  general and administrative expenses.  See Accountant's Report
with  respect to financial statements included in the Registrant's
Annual Report on Form 10-K for the year ended December 31, 1995.

                     It  is the Registrant's intention to continue
to  hold  the  properties until they can no longer meet  the  debt
service  requirements and the properties are  foreclosed,  or  the
market value of the properties increases to a point where they can
be  sold  at  a price which is sufficient to repay the  underlying
indebtedness.

               (2)  Capital Resources

                     Due  to the relatively recent rehabilitations
of  the  properties, any capital expenditures needed are generally
replacement  items and are funded out of cash from  operations  or
replacement reserves, if any.  The Registrant is not aware of  any
factors  which would cause historical capital expenditures  levels
not  to  be  indicative of capital requirements in the future  and
accordingly, does not believe that it will have to commit material
resources  to capital investment for the foreseeable  future.   If
the  need  for capital expenditures does arise, the first mortgage
holder for Third Quarter and Wistar Alley and nine units at Smythe
Stores has agreed to fund capital expenditures at terms similar to
the  first  mortgage.   The mortgagee did  not  fund  any  capital
expenditures during the third quarter of 1996.

               (3)  Results of Operations

                     During  the third quarter of 1996, Registrant
incurred  a  net loss of $284,767 ($24.28 per limited  partnership
unit)  compared  to a net income of $644,692 ($54.97  per  limited
partnership unit) for the same period in 1995.  For the first nine
months  of  1996, the Registrant incurred a net loss of $1,397,663
($119.18 per limited partnership unit) compared to a net income of
$39,058  ($3.33 per limited partnership unit) for the same  period
in 1995.

                     Rental  income decreased $6,203 from $144,980
in  the  third quarter of 1995 to $138,777 in the same  period  in
1996.   The decrease resulted from the foreclosure of one  of  the
Registrant's  properties ("Centre Park") in  July  1995  partially
offset  by  an increase in rental income at Smythe Stores  due  to
higher  average rental rates combined with increases in  occupancy
at both Third Quarter (84% to 99%) and Wistar Alley (87% to 93%).

                    Rental income decreased $144,070 from $513,643
for  the first nine months of 1995 to $369,573 for the same period
in 1996.  The decrease resulted from the foreclosure of one of the
Registrant's  properties  ("Centre  Park")  in  July  1995  and  a
decrease at Wistar Alley due to the loss of one commercial  tenant
partially  offset  by  an  increase in rental  income  due  to  an
increase in occupancy at Third Quarter (86% to 93%).

                     Expense  for  rental operations decreased  by
$34,839  from $121,204 in the third quarter of 1995 to $86,365  in
the same period in 1996.  Expenses for rental operations decreased
due to the foreclosure of Centre Park in July 1995 combined with a
decrease in maintenance expense at Smythe Stores partially  offset
by  an  increase in management fees at Wistar Allay and legal  and
condominium fees at Smythe Stores, as discussed below.

                     Expense  for  rental operations decreased  by
$107,691  from  $437,447  for the first nine  months  of  1995  to
$329,756  for  the  same  period in  1996.   Expenses  for  rental
operations decreased due to the foreclosure of Centre Park in July
1995  combined  with a decrease in maintenance expense  at  Smythe
Stores  partially  offset by increases in maintenance  expense  at
both  Third  Quarter and Wistar Alley, an increase in  commissions
expense  at  Wistar Alley and an increase in legal and condominium
fees at Smythe Stores, as discussed below.

                       Depreciation   and   amortization   expense
decreased  $12,038 from $90,933 in the third quarter  of  1995  to
$78,895  in  the  same period in 1996 and decreased  $78,741  from
$316,088 for the first nine months of 1995 to $237,347 in the same
period  in  1996.  The decreases are the result of the foreclosure
of Centre Park in July 1995.

                     Interest  expense increased by  $70,838  from
$147,123  in  the third quarter of 1995 to $217,961  in  the  same
period  in  1996.   The  increase is due to  an  increase  in  the
principal balance, due to the capitalization of past due  interest
by  the  mortgage holder, upon which interest is accrued at Smythe
Stores, partially offset by the foreclosure of Centre Park in July
1995.

                     Interest  expense increased by $579,657  from
$499,325  for the first nine months of 1995 to $1,078,982  in  the
same period in 1996.  The increase is the result of the accrual of
default  interest in the second quarter of 1996 that  should  have
been  accrued  in  prior years at Smythe Stores combined  with  an
increase  in the principal balance upon which interest is  accrued
at  Smythe  Store, partially offset by the foreclosure  of  Centre
Park in July 1995.

                     Losses  incurred during the third quarter  at
the  Registrant's  properties amounted to  $225,000,  compared  to
income of approximately $849,000 for the same period in 1995.  For
the   first  nine  months  of  1996  the  Registrant's  properties
recognized   a   loss  of  $1,254,000  compared   to   income   of
approximately $302,000 for the same period in 1995.

                     In  the  third  quarter of  1996,  Registrant
incurred  a  loss  of  $168,000 at the Smythe  Stores  Condominium
complex including $40,000 of depreciation expense, compared  to  a
loss of $81,000 in the third quarter of 1995, including $41,000 of
depreciation  expense.  The increase in the  loss  in  the  second
quarter  from the same period in 1996 is mainly the result  of  an
increase  in  interest  expense and  legal  and  condominium  fees
partially offset by an increase in rental income and a decrease in
maintenance  expense.   Interest  expense  increased  due  to   an
increase  in the principal balance upon which interest is  accrued
and  legal fees increased due to the modification of 9 of  the  20
mortgage  loans.   Condominium fees increased  due  to  a  special
assessment  charged  by  the condominium association  for  capital
improvements of the building.  Rental income increased due  to  an
increase  in  the  average monthly rental rates while  maintenance
expense  decreased pursuant to a change in the management contract
which was required by the new mortgage holder.

                     For the first nine months of 1996, Registrant
incurred  a  loss  of  $994,000 at the Smythe  Stores  Condominium
complex including $121,000 of depreciation expense, compared to  a
loss  of  $265,000 for the same period in 1995, including $123,000
of  depreciation expense.  The increase in the loss for the  first
nine  months  of 1995 from the same period in 1996 is  mainly  the
result   of  an  increase  in  interest  expense  and  legal   and
condominium  fees.  Interest expense increased due to the  accrual
in the second quarter of 1996 of default interest that should have
been  accrued  in prior years.  Legal fees increased  due  to  the
modification  of  9  of the 20 mortgage loans.   Condominium  fees
increased  due to a special assessment charged by the  condominium
association for capital improvements of the building.

                     In  the  third  quarter of  1996,  Registrant
incurred  a loss of $33,000 at Third Quarter Apartments, including
$17,000  of  depreciation expense, compared to a loss  of  $49,000
including $18,000 of depreciation expense in the third quarter  of
1995.  The decrease in the loss from the third quarter of 1995  to
the  same  period in 1996 is the result of an increase  in  rental
income due to an increase in average occupancy (84% to 99%).

                     For the first nine months of 1996, Registrant
incurred a loss of $140,000 at Third Quarter Apartments, including
$52,000  of  depreciation expense, compared to a loss of  $137,000
for  the  same  period in 1995, including $53,000 of  depreciation
expense.   The increase in the loss from the first nine months  of
1995  to  the  same  period  in 1996 is  due  to  an  increase  in
maintenance  and interest expense partially offset by an  increase
in  rental  income.  Maintenance expense increased pursuant  to  a
change in the management contract which increased the hourly rates
charged  for maintenance personnel and interest expense  increased
due to an increase in the principal balance upon which interest is
accrued.   Rental income increased due to an increase  in  average
occupancy (86% to 93%).

                     In  the  third  quarter of  1996,  Registrant
incurred  a loss of $24,000 at Wistar Alley, including $21,000  of
depreciation  expense,  compared to a loss  of  $28,000  including
$22,000 of depreciation expense in the third quarter of 1995.  The
decrease  in the loss from the third quarter of 1995 to  the  same
period in 1996 is due to an increase in average occupancy (87%  to
93%)  partially  offset  by  the loss  of  one  commercial  tenant
combined with an increase in the management fee due to the overall
increase in rental income.

                     For the first nine months of 1996, Registrant
incurred a loss of $120,000 at Wistar Alley, including $64,000  of
depreciation expense, compared to a loss of $91,000 for  the  same
period  in  1995, including $64,000 of depreciation expense.   The
increase  in  the loss from the first nine months of 1995  to  the
same period in 1996 is due to a decrease in rental income combined
with   an   increase  in  maintenance  and  commissions   expense.
Maintenance  expense  increased  pursuant  to  a  change  in   the
management  contract which increased the hourly rates charged  for
maintenance personnel and commissions expense increased due  to  a
higher turnover of units.  Rental income decreased due to the loss
of one commercial tenant.

                     In  the  third  quarter of  1996,  Registrant
incurred a loss of $0 at Centre Park Place, compared to income  of
$1,007,000 including $11,000 of depreciation expense in the  third
quarter  of 1995 and for the first nine months of 1996, Registrant
incurred a loss of $0 compared to income of $795,000 for the  same
period  in  1995, including $76,000 of depreciation expense.   The
decrease  in  the loss from the third quarter and the  first  nine
months of 1995 to the same periods in 1996 is due to the fact that
the property was foreclosed by the lender in July 1995.
<PAGE>
<TABLE>
                                 
                  DIVERSIFIED HISTORIC INVESTORS
               (a Pennsylvania limited partnership)
                                 
                    CONSOLIDATED BALANCE SHEETS
                                 
                              Assets
<CAPTION>
                                                  September 30, 1996        December 31, 1995
                                                  ------------------        -----------------                       (Unaudited)
                                                  
Rental properties, at cost:                                                                  
<S>                                                      <C>                       <C>                
Land                                                     $   331,362               $  331,362
Buildings and improvements                                 7,924,100                7,896,078
Furniture and fixtures                                       149,151                  149,151
                                                          ----------               ----------
                                                           8,404,613                8,376,591
Less - Accumulated depreciation                           (3,850,359)              (3,614,119)
                                                          ----------               ----------    
                                                           4,554,254                4,762,472
                                                                                             
Cash and cash equivalents                                      3,569                    4,571
Restricted cash                                               75,803                   40,882
Accounts receivable                                           86,799                   93,259
Other  assets  (net  of  amortization   of                                                   
$55,527 and $54,420 at September 30,  1996                                                   
and December 31, 1995, respectively)                                                         
                                                              43,773                   44,880
                                                          ----------               ----------                                   
       Total                                             $ 4,764,198              $ 4,946,064
                                                          ==========               ==========
                 Liabilities and Partners' Equity

Liabilities:
Debt obligations                                        $ 7,143,783             $ 5,607,067
Accounts payable:                                                                          
       Trade                                                476,235                 491,919
       Related parties                                      333,112                  94,540
       Taxes                                                138,519                 313,032
Interest payable                                          1,775,255               2,140,747
Accrued liabilities                                           1,400                  19,687
Tenant security deposits                                     53,423                  38,938
                                                         ----------              ----------                                        
       Total liabilities                                  9,921,727               8,705,930
                                                                                           
Partners' equity                                        (5,157,529)             (3,759,866)
                                                         ----------              ----------                                   
       Total                                            $ 4,764,198             $ 4,946,064
                                                         ==========              ========== 

The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
<TABLE>

                 DIVERSIFIED HISTORIC INVESTORS
               (a Pennsylvania limited partnership)
                                 
               CONSOLIDATED STATEMENTS OF OPERATIONS
 For the Three Months and Nine Months Ended September 30, 1996 and
                               1995
                            (Unaudited)
<CAPTION>
                                        Three months                         Nine months
                                     ended September 30,                 ended September 30,
                                       1996            1995                1996            1995
                                     --------        --------            --------        --------                    
Revenues:                                                                                          
<S>                                 <C>               <C>             <C>               <C>
   Rental income                    $ 138,777         $ 144,980       $   369,573       $   513,643
   Interest income                        177                91               349               394
                                      -------           -------           -------           -------
   Total revenues                     138,954           145,071           369,922           514,037
                                      -------           -------           -------           ------- 
Costs and expenses:                                                                                
   Rental operations                   86,365           121,204           329,756           437,447
   General and                                                                                     
      administrative                   40,500            40,500           121,500           121,500
   Interest                           217,961           147,123         1,078,982           499,325
   Depreciation and                                                                                
      amortization                     78,895            90,933           237,347           316,088
                                      -------           -------         ---------         ---------
   Total costs and                                                                                 
      expenses                        423,721           399,760         1,767,585         1,374,360
                                      -------           -------         ---------         ---------  
Loss before extraordinary           (284,767)         (254,689)       (1,397,663)         (860,323)
item

Extraordinary gain on                       0           899,381                 0           899,381
extinguishment of debt
                                    --------           --------        ---------         ----------
Net (loss) income                 ($ 284,767)         $ 644,692      ($1,397,663)       $    39,058
                                    ========           ========        =========         ==========             
Net (loss) income per                                                                              
limited partnership unit          ($   24.28)        $    54.97     ($    119.18)     $        3.33

The accompanying notes are an integral part of these financial statements.                             
</TABLE>
<PAGE>
<TABLE>
                  DIVERSIFIED HISTORIC INVESTORS
               (a Pennsylvania limited partnership)
                                 
               CONSOLIDATED STATEMENTS OF CASH FLOWS
       For the Nine Months Ended September 30, 1996 and 1995
                            (Unaudited)
<CAPTION>
                                                                   Nine months ended
                                                                     September 30,
                                                                    1996              1995
                                                                  --------          --------
Cash flows from operating activities:                                                         
<S>                                                             <C>                  <C>            
 Net (loss) income                                              ($1,397,663)       $  39,058
 Adjustments to reconcile net loss to net cash used in                                        
   operating activities:                                                                        
 Extraordinary gain on extinguishment of debt                             0         (899,381)
 Depreciation and amortization                                      237,347          316,088
 Minority interests                                                       0          (11,504)
 Changes in assets and liabilities:                                                           
 (Increase) decrease in restricted cash                             (34,921)          45,199
 Decrease (increase) in accounts receivable                           6,460          (20,238)
 (Decrease) increase in accounts payable - trade                    (15,682)         150,474
 Increase (decrease) in accounts payable - related                  238,572           (4,298)
   parties
 (Decrease) increase in accounts payable - taxes                   (174,513)          16,542
 (Decrease) increase in interest payable                           (365,492)         352,059
 Decrease in accrued liabilities                                    (18,287)          (1,637)
 Increase (decrease) in tenant security deposits                     14,483          (15,964)
                                                                  ---------          -------                                       
                                                    
Net cash used in operating activities                            (1,509,696)         (25,006)
                                                                  ---------          -------                            
Cash flows from investing activities:                                                         
 Capital expenditures                                               (28,022)         (11,347)
                                                                  ---------         --------                               
Net cash used in investing activities                               (28,022)         (11,347)
                                                                  ---------         --------                            
Cash flows from financing activities:                                                         
 Proceeds from debt financing                                     1,536,716           32,435
                                                                  ---------          -------                            
Net cash provided by  financing activities                        1,536,716           32,435
                                                                  ---------          -------                            
Decrease in cash and cash equivalents                                (1,002)          (3,918)
                                                                                              
Cash and cash equivalents at beginning of period                      4,571            7,789
                                                                  ---------          -------                           
Cash and cash equivalents at end of period                   $        3,569      $     3,871
                                                                  =========          =======                           
Supplemental Disclosure of Cash Flow Information:                                            
 Cash paid for interest                                            $124,431         $120,929
Supplemental Schedule of Non-Cash Investing and Financing                                     
Activities:
 Net assets transferred for liability reduction:*                                             
       Net assets transferred                                             0       $3,549,860
       Liability reduction                                                0        4,615,984
*  As a result of foreclosures on properties owned by the Partnership.
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
                  DIVERSIFIED HISTORIC INVESTORS
               (a Pennsylvania limited partnership)

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                            (Unaudited)


NOTE 1 - BASIS OF PRESENTATION

The  unaudited  consolidated financial statements  of  Diversified
Historic Investors (the "Registrant") and related notes have  been
prepared  pursuant to the rules and regulations of the  Securities
and  Exchange  Commission.  Accordingly, certain  information  and
footnote  disclosures  normally included in  financial  statements
prepared   in   accordance  with  generally  accepted   accounting
principles   have  been  omitted  pursuant  to  such   rules   and
regulations.   The accompanying consolidated financial  statements
and  related notes should be read in conjunction with the  audited
financial  statements  in Form 10-K of the Registrant,  and  notes
thereto, for the year ended December 31, 1995.

The  information furnished reflects, in the opinion of management,
all   adjustments,   consisting  of  normal  recurring   accruals,
necessary  for a fair presentation of the results of  the  interim
periods presented.

                    PART II - OTHER INFORMATION

Item 1.        Legal Proceedings

               Due to insufficient cash flow at Smythe Stores, the
Registrant  ceased  making debt service payments.   In  1990,  the
lender  was  placed  in  receivership  by  the  Resolution   Trust
Corporation  ("RTC").  The entities which purchased the  mortgages
from  the  RTC each filed complaints for foreclosure due  to  non-
payment; foreclosure proceedings on nine units were filed  in  the
Court of Common Pleas, Philadelphia County in the matters of Bruin
Holdings,  Inc.  ("Bruin") v Diversified  Historic  Investors  and
foreclosure proceedings on eleven units were filed in the Court of
Common  Pleas, Philadelphia County in the matters of EMC  Mortgage
Corporation v. Diversified Historic Investors.  In March 1996, the
Bruin  cases were settled and the nine mortgages were  sold.   The
Registrant  is  in the process of negotiating a modification  with
the  new  holder of the mortgage.  It is anticipated that the  new
terms  will  call for monthly payments of interest  in  an  amount
equal to net operating income, with a minimum monthly payment.   A
hearing  occurred  in  early May where  EMC's  motion  to  have  a
receiver appointed was denied.  The next hearing date has not  yet
been  set.   The  Registrant is pursuing settlement  negotiations;
however if no settlement is reached it is expected that the eleven
associated units will be foreclosed by the lender.

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

                No matter was submitted during the quarter covered
by this report to a vote of security holders.

Item 6.        Exhibits and Reports on Form 8-K

                          (a)             Exhibit           Number
Document

                  3       Registrant's  Amended  and   Restated
                          Certificate  of  Limited  Partnership
                          and      Agreement     of     Limited
                          Partnership,  previously   filed   as
                          part   of   Amendment   No.   2    of
                          Registrant's  Registration  Statement
                          on   Form   S-11,  are   incorporated
                          herein by reference.
                          
                  21      Subsidiaries  of the  Registrant  are
                          listed in Item 2. Properties on  Form
                          10-K,     previously    filed     and
                          incorporated herein by reference.

                   (b)   Reports on Form 8-K:

    No reports were filed on Form 8-K during the quarter ended
                        September 30, 1996.
<PAGE>
                            SIGNATURES

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

Date:  November 1, 1996       DIVERSIFIED HISTORIC INVESTORS

                                 By: Diversified Historic
                                 Advisors, General Partner
                                         
                                   By: Diversified Historic
                                   Properties, Inc., Partner
                                             
                                                  
                                      By: /s/ Donna M. Zanghi
                                          DONNA M. ZANGHI,
                                          Secretary and Treasurer