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, 1997 
                               ---------------------------------------
                                  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    X        No
<PAGE>
                    PART I - FINANCIAL INFORMATION

Item 1.        Financial Statements.

             Consolidated Balance Sheets - September 30, 1997
             (unaudited) and December 31, 1996
             Consolidated Statements of Operations - Three Months and
             Nine Months Ended September 30, 1997 and 1996 (unaudited)
             Consolidated Statements of Cash Flows - Nine Months Ended
             September 30, 1997 and 1996 (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, 1997, Registrant  had  cash  of
approximately  $4,127.  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,  1997,  Registrant   had
restricted  cash  of $57,693 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.

                     In  recent  years  the  Registrant  has  realized
significant losses, including the foreclosure of five properties and a
portion  of  a  sixth  property, due to the properties'  inability  to
generate sufficient cash flow to pay their operating expenses and debt
service.   At  the  present  time, the Registrant  has  feasible  loan
modifications  in place for its remaining three properties.   However,
in all three cases, the mortgages are basically "cash-flow" mortgages,
requiring all available cash after payment of operating expenses to be
paid to the first mortgage holder.  Therefore it is unlikely that  any
cash  will  be  available to the Registrant to  pay  its  general  and
administrative expenses.

                     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  each of the Registrant's three properties (Third Quarter,  Wistar
Alley  and the 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
1997.

               (3)  Results of Operations

                     During  the  third  quarter of  1997,  Registrant
incurred a net loss of $181,338 ($15.46 per limited partnership  unit)
compared  to a loss of $284,767 ($24.28 per limited partnership  unit)
for  the same period in 1996.  For the first nine months of 1997,  the
Registrant  incurred  a  net  loss of  $613,427  ($52.31  per  limited
partnership  unit)  compared  to a loss  of  $1,397,663  ($119.18  per
limited partnership unit) for the same period in 1996.

                     Rental income decreased $29,991 from $138,777  in
the third quarter of 1996 to $108,786 in the same period in 1997.  The
decrease  resulted  from the foreclosure of eleven  of  the  units  at
Smythe  Stores  in  December 1996 combined with a decrease  in  rental
income  at  Third  Quarter due to a decrease in the average  occupancy
(99%  to  85%)  partially offset by an increase in  rental  income  at
Wistar Alley due to an increase in the average rental rates.

                     Rental income decreased $52,250 from $369,573 for
the first nine months of 1996 to $317,323 for the same period in 1997.
The  decrease resulted from the foreclosure of eleven of the units  at
Smythe Stores in December 1996 partially offset by increases in rental
income  at  Wistar  Alley due to an increase in the average  occupancy
(86%  to  88%)  and Third Quarter due to an increase  in  the  average
rental rates.

                    Expense for rental operations decreased by $32,449
from  $86,365  in  the third quarter of 1996 to $53,916  in  the  same
period  in 1997.  Expenses for rental operations decreased due to  the
foreclosure  of  the eleven units at Smythe Stores  in  December  1996
partially  offset by an overall increase in rental operations  expense
at Wistar Alley due to an overall increase in average occupancy and an
increase  in commissions expense due to a higher turnover of units  at
Third Quarter.

                    Expense for rental operations decreased by $99,211
from  $329,756 for the first nine months of 1996 to $230,545  for  the
same period in 1997.  Expenses for rental operations decreased due  to
the  foreclosure of the eleven units at Smythe Stores in December 1996
combined with a decrease in real estate taxes at Third Quarter due  to
a decrease in the assessed value of the property.

                     Depreciation  and amortization expense  decreased
$21,685  from $78,895 in the third quarter of 1996 to $57,210  in  the
same  period in 1997 and decreased $65,716 from $237,347 for the first
nine  months  of  1996  to $171,631 in the same period  in  1997.  The
decreases  are  the result of the foreclosure of the eleven  units  at
Smythe Stores in December 1996.

                     Interest expense decreased $56,241 from  $217,961
in  the  third quarter of 1996 to $161,720 in the same period in  1997
and  decreased $602,374 from $1,078,982 for the first nine  months  of
1996  to  $476,608 in the same period in 1997.  The decrease for  both
the  third  quarter and the first nine months to the same  periods  in
1997 is the result of the one-time accrual of default interest in  the
second  quarter of 1996 of interest that should have been  accrued  in
prior years at Smythe Stores, (which was not repeated in 1997).

                     Losses incurred during the third quarter  at  the
Registrant's properties amounted to $153,000, compared to  a  loss  of
approximately  $225,000 for the same period in 1995.   For  the  first
nine  months of 1997 the Registrant's properties recognized a loss  of
$530,000  compared to a loss of approximately $1,254,000 for the  same
period in 1995.

                     In the third quarter of 1997, Registrant incurred
a  loss  of $84,000 at the Smythe Stores Condominium complex including
$19,000 of depreciation expense, compared to a loss of $168,000 in the
third  quarter of 1996, including $40,000 of depreciation expense  and
for  the  first  nine months of 1997, Registrant incurred  a  loss  of
$285,000 including $55,000 of depreciation expense, compared to a loss
of  $994,000  for  the  same  period in 1996,  including  $121,000  of
depreciation  expense.  The decrease in the loss for  both  the  third
quarter and the first nine months of 1996 to the same periods in  1997
is  mainly the result of the loss of the eleven units in December 1996
combined with a decrease in interest expense due to the accrual in the
second  quarter  of  1996 of default interest that  should  have  been
accrued in prior years due to the modification of 9 of the 20 mortgage
loans.

                     In the third quarter of 1997, Registrant incurred
a  loss  of $39,000 at Third Quarter Apartments, including $18,000  of
depreciation expense, compared to a loss of $33,000 including  $17,000
of depreciation expense in the third quarter of 1996.  The increase in
the loss from the third quarter of 1996 to the same period in 1997  is
the result of a decrease in rental income due to a decrease in average
occupancy  (99%  to  85%)  combined with an  increase  in  commissions
expense due to a higher turnover of units.

                     For  the  first  nine months of 1997,  Registrant
incurred  a  loss  of $130,000 at Third Quarter Apartments,  including
$53,000  of  depreciation expense, compared to a loss of $140,000  for
the  same  period in 1996, including $52,000 of depreciation  expense.
The  decrease in the loss from the first nine months of  1996  to  the
same period in 1997 is the result of an increase in rental income  due
to  an  increase in average rental rates combined with a  decrease  in
real  estate  taxes  due to a decrease in the assessed  value  of  the
property.

                     In the third quarter of 1997, Registrant incurred
a  loss  of $30,000 at Wistar Alley, including $21,000 of depreciation
expense,   compared  to  a  loss  of  $24,000  including  $21,000   of
depreciation  expense in the third quarter of 1996.  The  increase  in
the loss from the third quarter of 1996 to the same period in 1997  is
due  to  an overall increase in rental operations expense due  to  the
increase in average occupancy partially offset by an increase  in  the
average rental rates.

                     For  the  first  nine months of 1997,  Registrant
incurred  a  loss  of $115,000 at Wistar Alley, including  $64,000  of
depreciation  expense,  compared to a loss of $120,000  for  the  same
period  in  1996,  including  $64,000 of  depreciation  expense.   The
decrease  in the loss from the first nine months of 1996 to  the  same
period  in  1997  is due to an increase in rental  income  due  to  an
increase in the average occupancy (86% to 88%).
<PAGE>
                                   
                    DIVERSIFIED HISTORIC INVESTORS
                 (a Pennsylvania limited partnership)
                                   
                      CONSOLIDATED BALANCE SHEETS
                                   
                                Assets

                                      September 30, 1997      December 31, 1996
                                          (Unaudited)
Rental properties, at cost:                                           
Land                                     $   310,833              $   310,833
Buildings and improvements                 5,739,078                5,721,048
Furniture and fixtures                       113,742                  113,742
                                          ----------               ----------
                                           6,163,653                6,145,623
Less - Accumulated depreciation           (2,994,523)              (2,822,893)
                                          ----------               ----------
                                           3,169,130                3,322,730
                                                                      
Cash and cash equivalents                      4,127                    4,017
Restricted cash                               57,693                   68,063
Accounts receivable                           12,740                   58,582
Other assets (net of amortization of                            
$30,510 at September 30, 1997 and 
December 31, 1996)                                 0                        0
                                          ----------               ----------
       Total                             $ 3,243,690              $ 3,453,392
                                          ==========               ==========

                   Liabilities and Partners' Equity

Liabilities:
Debt obligations                         $ 5,870,938              $ 5,834,574
Accounts payable:                                                    
       Trade                                 342,477                  264,967
       Related parties                       353,461                  323,640
Interest payable                           1,132,445                  874,307
Accrued liabilities                            3,351                    2,975
Tenant security deposits                      41,745                   40,229
                                          ----------               ---------- 
       Total liabilities                   7,744,417                7,340,692
                                          ----------               ----------
Partners' equity                          (4,500,727)              (3,887,300)
                                          ----------               ---------- 
       Total                             $ 3,243,690              $ 3,453,392
                                          ==========               ==========

The accompanying notes are an integral part of these financial statements.
<PAGE>
                    DIVERSIFIED HISTORIC INVESTORS
                 (a Pennsylvania limited partnership)
                                   
                 CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three Months and Nine Months Ended September 30, 1997 and 1996
                              (Unaudited)

                                      Three months            Nine months
                                   ended September 30,     ended September 30,
                                    1997         1996        1997       1996
                                   ------       ------      ------     ------
Revenues:                       
   Rental income                 $ 108,786   $ 138,777   $ 317,323   $ 369,573
   Interest income                     182         177         414         349
                                   -------     -------     -------     ------- 
   Total revenues                  108,968     138,954     317,737     369,922
                                   -------     -------     -------     ------- 
Costs and expenses:             
   Rental operations                53,916      86,365     230,545     329,756
   General and administrative       17,460      40,500      52,380     121,500
   Interest                        161,720     217,961     476,608   1,078,982
   Depreciation and                                               
      amortization                  57,210      78,895     171,631     237,347
                                   -------     -------     -------   --------- 
   Total costs and expenses        290,306     423,721     931,164   1,767,585
                                   -------     -------     -------   ---------
Net loss                        ($ 181,338) ($ 284,767) ($ 613,427)($1,397,663)
                                   =======     =======     =======   =========
Net loss per limited partnership  
unit                            ($   15.46) ($   24.28) ($   52.31)($   119.18)
                                   =======     =======     =======   ========= 

The accompanying notes are an integral part of these financial statements.
<PAGE>
                    DIVERSIFIED HISTORIC INVESTORS
                 (a Pennsylvania limited partnership)
                                   
                 CONSOLIDATED STATEMENTS OF CASH FLOWS
         For the Nine Months Ended September 30, 1997 and 1996
                              (Unaudited)

                                                         Nine months ended
                                                           September 30,
                                                        1997           1996

Cash flows from operating activities:                                         
 Net loss                                           ($613,427)    ($1,397,663)
 Adjustments to reconcile net loss to net
   cash used in operating activities:
 Depreciation and amortization                        171,631         237,347
 Changes in assets and liabilities:                                           
 Decrease (increase) in restricted cash                10,370         (34,921)
 Decrease in accounts receivable                       45,842           6,460
 Increase (decrease) in accounts payable - trade       77,509         (15,682)
 Increase in accounts payable - related parties        29,821         238,572
 Decrease in accounts payable - taxes                       0        (174,513)
 Increase (decrease) in interest payable              258,138        (365,492)
 Increase (decrease) in accrued liabilities               376         (18,287)
 Increase in tenant security deposits                   1,516          14,483
                                                      -------       ---------
Net cash used in operating activities                 (18,224)     (1,509,696)
                                                      -------       --------- 
Cash flows from investing activities:                                         
 Capital expenditures                                 (18,030)        (28,022)
                                                      -------       --------- 
Net cash used in investing activities                 (18,030)        (28,022)
                                                      -------       ---------
Cash flows from financing activities:                                         
 Proceeds from debt financing                          36,364       1,536,716
                                                      -------       ---------
Net cash provided by financing activities              36,364       1,536,716
                                                      -------       ---------
Increase (decrease) in cash and cash equivalents          110          (1,002)
                                                                              
Cash and cash equivalents at beginning of period        4,017           4,571
                                                      -------       ---------
Cash and cash equivalents at end of period           $  4,127      $    3,569
                                                      =======       =========
Supplemental Disclosure of Cash Flow Information:                            
 Cash paid for interest                              $188,649      $  124,431

The accompanying notes are an integral part of these financial statements.
<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, 1996.

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

                To  the best of its knowledge, Registrant is not party
to,  nor  is any of its property the subject of, any pending  material
legal proceedings.

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, 1997.
<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 14, 1997      DIVERSIFIED HISTORIC INVESTORS
       -----------------
                              By: Diversified Historic Advisors, General Partner
                                         
                                  By: EPK, Partner
                                             
                                      By:  /s/ Donna M. Zanghi
                                           ----------------------------
                                           DONNA M. ZANGHI,
                                           Vice President and Secretary