UNITED STATES
                   SECURITIES AND EXCHANGE COMMISSION

                         Washington, D.C. 20549


                                FORM 10-Q


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

            For the quarterly period ended September 30, 1998
                                    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 0-19198


                 FIRST DEARBORN INCOME PROPERTIES L.P. II
          (Exact name of registrant as specified in its charter)


     Delaware                                             36-3591517
(State of organization)                     (IRS Employer Identification No.)


154 West Hubbard Street, Suite 250, Chicago, IL               60610
  (Address of principal executive offices)                  (Zip Code)


       Registrant's telephone number, including area code (312) 464-0100





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 ____


Units outstanding as of September 30, 1998:  10,000
<PAGE>

PART I - FINANCIAL INFORMATION
Item 1.  Financial Statements
<TABLE>
                   FIRST DEARBORN INCOME PROPERTIES L.P. II
                         (a limited partnership)
                         and Consolidated Venture

                               Balance Sheets

                    September 30, 1998 and December 31, 1997
                                 (Unaudited)

                                   Assets
<CAPTION>
                                          	September 30,     	December 31,
	                                          1998               1997
<S>	                                       <C>                <C> 
Current assets:
    	Cash and cash equivalents (note 1)     1,010,135         	1,659,443
     Rents and other receivables             	195,189           	317,315
     Due from affiliates                      	13,147            	14,122
     Prepaid expense                    	         305	            19,122
          Total current assets             	1,218,776         	2,010,002

Investment property, at cost (note 1):                              
     Land                                  	1,201,880         	1,201,880
     Building                            	  8,372,099       	  8,372,099
                                           	9,573,979         	9,573,979
     Less accumulated depreciation        	(2,248,085)       	(2,032,976)
                                         	  7,325,894       	  7,541,003

Investment in unconsolidated venture,
                  at equity (note 2)         	(66,867)          	(58,669)
Deferred leasing and loan costs	               42,305	            49,488

     Total assets                           8,520,108	         9,541,824




<FN>
See accompanying notes to the financial statements.
</TABLE>
<PAGE>

<TABLE>
                FIRST DEARBORN INCOME PROPERTIES L.P. II
                        (a limited partnership)
                        and Consolidated Venture

                            Balance Sheets

                 September 30, 1998 and December 31, 1997
                             (Unaudited)

                Liabilities and Partners' Capital Accounts
<CAPTION>
                                            	September 30,   	  December 31,
                             	               1998 	             1997
<S>                                          <C>                <C>
Current liabilities:
     Accounts payable and accrued expenses     358,620         	  328,632
     Accrued interest                          	30,137            	30,976
     Current portion of long-term debt   	     172,500    	       166,915
          Total current liabilities           	561,257           	526,523

Long-term debt                              	4,278,525	         4,408,018
Venture partners' equity
  in consolidated venture (note 2)          	1,339,791         	1,508,231
Tenant security deposits                         5,433    	         5,433
     Total long-term liabilities          	  5,623,749       	  5,921,682

     Total liabilities                    	  6,185,006       	  6,448,205

Partners' capital accounts (deficits):
     General partners: 
          Capital contributions	                 1,000             	1,000
          Cumulative net income                  4,513        	     4,280
                                                 5,513        	     5,280

     Limited partners:
          Capital contributions             	4,058,963         	4,058,963
          Cumulative net income               	446,724	           423,674
          Cumulative cash distributions    	(2,176,098)       	(1,394,298)
                                          	  2,329,589       	  3,088,339

      Total partners' capital accounts    	  2,335,102       	  3,093,619

Commitments and contingencies (note 2)

   Total Liabilities and Partners' Capital   8,520,108	         9,541,824
<FN>
See accompanying notes to the financial statements.
</TABLE>
<PAGE>

<TABLE>
                  FIRST DEARBORN INCOME PROPERTIES L.P. II
                        (a limited partnership)
                        and Consolidated Venture

                    Consolidated Statement of Operations

               Three months ended September 30, 1998 and 1997

                               (Unaudited)

<CAPTION>
                                   	        1998      	          1997
<S>                                         <C>                  <C>
Revenues:
     Rental income                          252,990             	302,937
     Tenant charges                        	112,077	             137,467
     Interest income                   	      9,912	               5,894
          Total revenues                	   374,979	             446,298

Expenses:
     Property operating expenses           	169,406             	190,267
     Interest                               	90,698              	93,999
     Depreciation                           	72,908              	72,879
     Amortization                            	2,395               	2,394
     General and administrative expenses     18,556	               7,957

          Total expenses                	   353,963           	  367,496

Operating income                             21,016              	78,802

Partnership's share of operations
   of unconsolidated ventures               	43,640             	(24,231)

Venture partner's share of consolidated
   venture's operations (note 1) 	            1,013	             (38,654)

Net income                                   65,669	              15,917

Net income (loss) 
   per limited partnership unit  	             6.50	                1.58

Cash distribution 
   per limited partnership unit	               2.06          	      2.06
<FN>
See accompanying notes to the financial statements.
</TABLE>
<PAGE>

<TABLE>
                  FIRST DEARBORN INCOME PROPERTIES L.P. II
                          (a limited partnership)
                          and Consolidated Venture

                   Consolidated Statement of Operations

                Nine months ended September 30, 1998 and 1997

                               (Unaudited)

<CAPTION>
                                           1998      	         1997
<S>                                        <C>                 <C>
Revenues:
     Rental income                      	    833,045            	937,944
     Tenant charges                         	358,188            	422,912
     Interest income                   	      34,964       	      15,587

          Total revenues                	  1,226,197         	 1,376,443

Expenses:
     Property operating expenses            	626,558            	671,288
     Interest                               	274,628            	284,331
     Depreciation                           	215,109            	218,638
     Amortization                             	7,184              	7,390
     General and administrative expenses 	    91,536	             70,578

          Total expenses                	  1,215,015	          1,252,226

Operating income                              11,182            	124,216

Partnership's share of operations
  of unconsolidated ventures                 	30,977            	(56,845)

Venture partner's share of consolidated
  venture's operations (note 1)         	    (18,876)	           (84,304)

Net income (loss)                             23,283      	      (16,933)

Net income (loss) 
   per limited partnership unit                 2.31      	        (1.68)

Cash distribution 
   per limited partnership unit	               78.18	               6.19
<FN>
See accompanying notes to the financial statements.
</TABLE>
<PAGE>

<TABLE>
                    FIRST DEARBORN INCOME PROPERTIES L.P. II
                           (a limited partnership)
                           and Consolidated Venture

                     Consolidated Statements of Cash Flows

                  Nine months ended September 30, 1998 and 1997

                                 (Unaudited)

<CAPTION>
                                     	        1998	               1997
<S>                                           <C>                 <C>
Cash flows from operating activities:
  Net income (loss)                             	23,283           	(16,933)
  Items not requiring (providing)
         cash or cash equivalents:
     Depreciation                              	215,109           	218,638
     Amortization                                	7,184             	7,390
     Partnership's share of operations of   
                 unconsolidated  ventures         8,198	           140,849
     Venture partners' share of consolidated
                     venture's operations     	(168,440)	           (3,152)

  Changes in:
     Rents and other receivables               	123,101            	(3,357)
     Prepaid expenses                           	18,817             	4,483
     Accounts payable and accrued expenses      	29,149            	(3,710)
     Tenant deposits	                                 0	                (6)
Net cash provided by operating activities    	  256,401	           434,642

Cash flow from investment activities:
Additions to building and deferred costs	             0                  0
Net cash used in investment activities  	             0                  0


Cash flows from financing activities:
     Distributions to limited partners	        (781,800)	          (61,903)
     Principal payments on long-term debt      (123,908)      	   (114,270)
Net cash used in financing activities        	 (905,708)        	 (176,173)

Net increase (decrease) in cash
          and cash equivalents   	             (649,307)	          257,696

<FN>
See accompanying notes to the financial statements.
</TABLE>
<PAGE>

                  FIRST DEARBORN INCOME PROPERTIES L.P. II
                         (a limited partnership)
                         and Consolidated Venture

                 Notes to Consolidated Financial Statements

                        September 30, 1998 and 1997

                               (Unaudited)

     Readers of this quarterly report should refer to the Partnership's 
audited financial statements for the fiscal year ended December 31, 1997, 
which are included in the Partnership's 1997 Annual Report, as certain 
footnote disclosures which would substantially duplicate those contained 
in such audited financial statements have been omitted from this report.

(1)  Basis of Accounting

     For the three and nine month periods ended September 30, 1998 and 
September 30, 1997 the accompanying consolidated financial statements 
include the accounts of the Partnership and its consolidated venture - 
Sycamore Mall Associates (the Venture).  The effect of all transactions 
between the Partnership and the Venture has been eliminated.

     The equity method of accounting has been applied in the accompanying 
consolidated financial statements with respect to the Partnership's 
interest in Evanston Galleria Limited for the three and nine months ended 
September 30, 1998 and September 30, 1997 and Country Isle Associates for 
the three and nine months ended September 30, 1997.

     The Partnership records are maintained on the accrual basis of accounting 
as adjusted for Federal income tax reporting purposes.  The accompanying 
consolidated financial statements have been prepared from such records 
after making appropriate adjustments, where applicable, to present the 
Partnership's accounts in accordance with generally accepted accounting 
principles (GAAP).  Such adjustments are not recorded on the records of 
the Partnership.  The net effect of these adjustments for the nine months 
ended September 30, 1998 and 1997 is summarized as follows:

<TABLE>
<CAPTION>
                                      	   1998             	  1997    
                                 	   GAAP  	   Tax      GAAP        Tax
                              	      Basis 	   Basis    Basis       Basis  
<S>                                  <C>       <C>      <C>         <C>
Net income (loss)                  	 23,283   	9,300   	(14,696)   	(29,301)

Net income (loss) per 
 limited partnership unit 	  2.31	0.92	(1.45)	(2.90)
</TABLE>

     The net loss per limited partnership unit presented is based on the 
weighted limited partnership units outstanding at the end of each period 
(10,000).

<PAGE>

                     FIRST DEARBORN INCOME PROPERTIES L.P. II
                              (a limited partnership)
                              and Consolidated Venture

               Notes to Consolidated Financial Statements - Continued

     Partnership distributions from unconsolidated ventures are considered 
cash flow from operating activities to the extent of the Partnership's 
cumulative share of net operating earnings before depreciation and non-cash 
items.  In addition, the Partnership records amounts held in U.S. 
Government obligations, commercial paper and certificates of deposit at 
cost which approximates market.  For the purposes of these statements, the 
Partnership's policy is to consider all such investments with an original 
maturity of three months or less ($797,764 and $1,400,707 at September 30, 
1998 and December 31, 1997, respectively) as cash equivalents.

     Deferred offering costs were charged to the partners' capital accounts 
upon consummation of the offering. Deferred loan costs are amortized over 
the terms of the related agreements using the straight-line method.

     Depreciation on the investment properties acquired has been provided over 
the estimated useful lives of 5 to 30 years using the straight-line method.

     No provision for Federal income taxes has been made as any liability for 
such taxes would be that of the partners rather than the Partnership.

     The Partnership adopted Statement of Financial Accounting Standards No. 121
(SFAS 121) Accounting for the Impairment of Long-Lived Assets and for 
Long Lived Assets to be Disposed Of, on January 1, 1996.  SFAS 121 requires 
that the Partnership record an impairment loss on its property held for 
investment whenever the property's carrying value cannot be fully recovered 
through estimated undiscounted cash flows from its 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.  In addition, SFAS 121 provides that a property may not be 
depreciated while being held for sale.  As of October 1, 1997, the Evanston 
Galleria property was considered to be held for sale.  In accordance with 
SFAS 121, no depreciation expense relative to the property was recorded 
from October 1, 1997 through September 30, 1998.

(2)  Venture Agreements

      The Partnership has entered into three joint venture agreements with 
partnerships sponsored by affiliates of the General Partners.  Pursuant to 
such agreements, the Partnership has made capital contributions aggregating 
$3,652,066 through September 30, 1998.  The Partnership has acquired, 
through these ventures, interests in a mixed use retail/residential 
property and two shopping centers.
<PAGE>

              FIRST DEARBORN INCOME PROPERTIES L.P. II
                    (a limited partnership)
                   and Consolidated Venture

Notes to Consolidated Financial Statements - Continued

(3)  Transactions with Affiliates

     Fees, commissions and other expenses required to be paid by the
Partnership to affiliates of the General Partners for the nine months ended
September 30, 1998 and 1997 are as follows:
<TABLE>
<CAPTION>
                                                                         		 	Unpaid at
                                                           	              	 	9/30,
                                                      	1998    	1997        	1998
<S>                                                    <C>      <C>          <C>
Reimbursement (at cost) for administrative services	   15,000  	15,000       0

</TABLE>

 (4)  Unconsolidated Venture - Summary Information

     Summary income statement information for Evanston Galleria Limited 
Partnership for the nine months ended September 30, 1998 and Evanston 
Galleria Limited Partnership and Country Isle Plaza for the nine months 
ended September 30, 1997, is as follows: 

<TABLE>
<CAPTION>

     		                                                                                  1998              1997
<S>                                             <C>              <C>
     Total revenue                             	1,087,386       	2,264,085
     Operating income (loss)                       	4,830	        (218,310)
     Partnership's share of income (loss)          30,977         	(56,845)
</TABLE>

(5)  Adjustments

     In the opinion of the Managing General Partner, all adjustments 
(consisting solely of normal recurring adjustments) necessary for a fair 
presentation have been made to the accompanying consolidated financial 
statements as of September 30, 1998 and 1997.
<PAGE>

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

Liquidity and Capital Resources

     At June 30, 1998, the Partnership had cash and cash equivalents of 
$1,052,765 which will be utilized for working capital requirements and 
for future distributions to Partners.  This is $653,941 less than the 
$1,659,443 balance at December 31, 1997. The Partnership made a distribution
in the amount of $740,600 to Limited Partners during the first quarter of 1998. 
The Partnership received a special distribution in the amount of $991,000 
from the December 1997 sale of Country Isles Associates, which it then 
distributed to the Limited Partners.  During the three and six month 
periods ended June 30, 1998, the Partnership distributed $20,600 ($2.06 
per unit) and $761,200 ($76.12 per unit), respectively, to Limited Partners.
This compares to $20,600 ( $2.06 per unit) and $41,303 ( $4.13 per unit) 
during the three and six month periods ended June 30, 1997.  The Partnership 
has continued to build additional cash reserves for Sycamore Mall's 
anticipated releasing program.

     Net cash provided by operating activities during the six months ended 
June 30, 1998 was $236,592, a decrease of $27,048 from the $263,640 of cash 
provided by operating activities during the six months ended June 30, 1997.

     On December 17, 1997, Country Isles Associates, sold the Country Isles 
Shopping Center in Fort Lauderdale, Florida, to Principal Mutual Life 
Insurance Company ("Buyer").  The total purchase price received by Country Isles
was $13.2 million, which price was determined through arm's length 
negotiations with Buyer.  Of this total purchase price, approximately 
$7.9 million was used to repay amounts owed to the lender holding the 
mortgage on the shopping center and approximately $595,000 was used for 
customary additional selling expenses and prorations.  The net proceeds to 
Country Isles after these deductions were approximately $4.7 million. Of 
these proceeds, the Partnership received approximately $991,000 for its 21% 
interest.

     During 1997, the Evanston Galleria experienced occupancy rates which ranged
from 77% to 86%. As of December 31, 1997 occupancy was 83%.  However, a lease 
had been entered into to lease the lower level space of 11,300 square feet.  
This tenant has taken occupancy along with one additional retail tenant.  
This has increased occupancy to 95%, as of March 31, 1998.  The first 
mortgage  on the property matured on May 1, 1998, however an amendment has 
been entered into which extends the maturity of the loan to August 31, 1998. 
Negotiations are currently underway for an additional extension of the 
mortgage loan.  There can be no assurance that such an extension will be 
granted.  The Evanston Galleria property is currently being marketed for sale.

     As the Partnership intends to distribute all "net cash receipts" and
"sales proceeds" in accordance with the terms of the Partnership Agreement, 
and does not intend to reinvest any such proceeds, the Partnership is 
intended to be self-liquidating in nature.  The Partnership's future source 
of liquidity and distributions is expected to be through cash generated by 
the Partnership's investment properties and from the sale and refinancing of
such properties.  To the extent that additional payments are required under 
a purchase agreement or a property does not generate an adequate cash flow 
to meet its requirements, the Partnership may withdraw funds from the working
capital reserve which it maintains.

<PAGE>

Results of Operations - 1998 compared to 1997

     For the three and nine month periods ended September 30, 1998 and September
30, 1997, the accompanying consolidated financial statements include the 
accounts of the Partnership and its consolidated venture - Sycamore Mall 
Associates.  The effect of all transactions between the Partnership and the 
Venture has been eliminated.  The equity method of accounting has been applied 
in the accompanying consolidated financial statements with respect to the 
Partnership's interest in Evanston Galleria Limited for the three and nine month
periods ended September 30, 1998 and September 30, 1997 and Country Isle 
Associates for the three and nine months ended September 30, 1997.

      Net income for the nine months ended September 30, 1998 was $23,283 as 
compared to a loss of $16,933 during the nine months ended September 30, 1997.
The improvement is largely due to $39, 741 of income received from 
Country Isles Associates during the three months ended September 30, 
1998. Net income for the three months ended September 30, 1998 was $65,669 
as compared to $15,917 during the three months ended September 30, 1997.
A decrease in operating results at Sycamore Mall was partially offset by 
improvement at the Evanston Galleria, during both the three and nine month 
periods ended September 30, 1998.  The decreased profitability at Sycamore 
Mall is a result of increased vacancy, averaging 83% in 1998 as compared to 
87% in 1997.  Management is continuing to search for new tenants for Sycamore 
Mall, but no new leases have been signed.  Sears has recently vacated 
the Sycamore Mall,  which will further reduce earnings until new tenants can 
be obtained.

     The $104,899 (11%) decrease in rental income and the $64,724 (15%) decrease
in tenant charges, for the nine month period ended September 30, 1998 as 
compared to the nine month period ended September 30, 1997 is attributed to 
an increase in vacancy at Sycamore Mall.  The opening of a new regional 
mall in the area of the Sycamore Mall has resulted in the loss of several 
tenants.

     The $19,377 (124%) increase in interest income for the nine month period 
ended September 30, 1998 as compared to the nine month period ended 
September 30, 1997 is attributed to the increase in cash reserves which are
being maintained since the sale of the Country Isles property in December 
1997.  The Partnership is maintaining these additional reserves in anticipation 
of needed equity for the Sycamore Mall releasing efforts.

     The $44,730 (7%) decrease in property operating expenses for the nine month
period ended September 30, 1998 as compared to the nine month period ended 
September 30, 1997 is attributed to a decrease in property maintenance and 
operating expenses at Sycamore Mall.

     The $9,703 (3%) decrease in interest expenses for the nine month period 
ended September 30, 1998 as compared to the nine month period ended 
September 30, 1997 is attributable a reduction in the outstanding 
indebtedness at Sycamore Mall.

     The $20,958 (30%) increase in general and administrative expenses for
the nine month period ended September 30, 1998 as compared to the nine month
period ended September 30, 1997 is attributable to an increase in 
professional fees related to the annual audit and tax return preparation 
and legal fees incurred at Sycamore Mall related to the attempted collection 
of past due rents.

     The Partnership's share of operations of unconsolidated subsidiaries 
resulted in a loss allocation of $12,663 during the nine month period 
ended September 30, 1998, as compared to a loss allocation of $32,614 
during the nine month period ended September 30, 1997.  Evanston Galleria 
has released most of its retail space.  Occupancy is running at 94 % as 
compared to 77 % in the prior year.
<PAGE>


     The Partnership's allocation of consolidated venture's operations to 
the venture partners was an allocation of $18,876 during the nine month 
period ended September 30, 1998 as compared to an allocation of $84,304 
during the nine month period ended September 30, 1997.  As a result of a 
decrease in operating income at Sycamore Mall, the Partnership has decreased 
the amount of the income, which is then allocated to the venture's partners.


                                  OCCUPANCY


     The following is a list of approximate occupancy levels by quarter for 
the Partnership's investment properties:
<TABLE>
<CAPTION>
                         at         at         at         at         at        at              at
                         03/31/97   06/30/97   09/30/97   12/31/97   03/31/98   06/30/98   09/30/98
<S>                      <C>         <C>        <C>        <C>        <C>        <C>        <C>
Evanston Galleria
Evanston, IL              86%        86%         77%       83%        95%        94%        94%

Country Isles
Ft. Lauderdale, FL       100%        99%        100%       n/a        n/a        n/a        n/a

Sycamore Mall
Iowa City, Iowa           88%        89%         89%       90%        85%        79%        84%
<PAGE>




Part II - OTHER INFORMATION


Items 1, 2, 3, 4, and 5 of Part II are omitted because of the absence of
conditions under which they are required.


Item 6.  Exhibits and Reports on Form 8-K

a)   Exhibits

     None

b)   Reports on Form 8-K

     No reports on Form 8-K were filed for the period covered by this report.

<PAGE>



SIGNATURES



     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.



	FIRST DEARBORN INCOME PROPERTIES L.P. II
	(Registrant)


	By:  FDIP, Inc.
	(Managing General Partner)




November 14, 1998	By:  Robert S. Ross
                      	President
                     	(Principal Executive Officer)






November 14, 1998	By:  Bruce H. Block
                      	Vice President
                     	(Principal Financial Officer)

</TABLE>