Form 10-QSB

                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                      |X|    Quarterly Report Pursuant to Section 13 or 15(d) of
                             the Securities Exchange Act of 1934.
                             For the quarterly period ended June 30, 1997

                      |_|    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 0-17631

              ATEL Cash Distribution Fund II, a California Limited
                    Partnership (Exact name of registrant as
                            specified in its charter)

   California                                                   94-3051991
(State or other jurisdiction of                            (I. R. S. Employer
incorporation or organization)                            Identification No.)

           235 Pine Street, 6th Floor, San Francisco, California 94104
                    (Address of principal executive offices)

Registrant's telephone number, including area code (415) 989-8800

Indicate  by a 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 |_|

                       DOCUMENTS INCORPORATED BY REFERENCE

                                      None


<PAGE>

                          Part I FINANCIAL INFORMATION

Item 1.   Financial Statements.


<PAGE>

                         ATEL CASH DISTRIBUTION FUND II
                       (A CALIFORNIA LIMITED PARTNERSHIP)

                                  BALANCE SHEET

                                  JUNE 30, 1997
                                   (Unaudited)


                                     ASSETS




Cash and cash equivalents                                              $930,138

Accounts receivables, net of allowance for
   doubtful accounts of $15,552                                          93,320

Investment in equipment and leases                                    3,518,451
                                                               ----------------
                                                                    $4,541,909
                                                               ================


                          LIABILITIES AND PARTNERS' CAPITAL


Non-recourse debt                                                   $1,108,591

Accrued interest                                                        17,270

Accounts payable:
     General partners                                                    1,541
     Other                                                              72,081

Customer deposit                                                         9,000

Unearned operating lease income                                         10,681
                                                               ----------------
Total liabilities                                                    1,219,164

Partners' capital:
     General partners                                                   83,688
     Limited partners                                                3,239,057
                                                               ----------------
Total partners' capital                                              3,322,745
                                                               ----------------
                                                                    $4,541,909
                                                               ================


                        See notes to financial statements


<PAGE>

                         ATEL CASH DISTRIBUTION FUND II
                       (A CALIFORNIA LIMITED PARTNERSHIP)

                                INCOME STATEMENTS

                        SIX AND THREE MONTH PERIODS ENDED
                             JUNE 30, 1997 AND 1996
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                              Six Months                        Three Months
                                                            Ended June 30,                     Ended June 30,
Revenues:                                               1997              1996             1997             1996
                                                        ----              ----             ----             ----
<S>                                                       <C>               <C>              <C>              <C>
Lease income:
     Operating                                            $517,582          $806,088         $243,145         $374,416
     Direct financing                                       87,003           178,607           40,381           85,603
     Leveraged leases                                       12,138             9,645            6,069            4,822
     Gain on sales of assets                               150,117            63,650           68,045           61,723
Other income                                                63,752            97,828           62,933           18,362
Interest income                                             12,965             6,145            6,738            3,148
                                                   ---------------- ----------------- ---------------- ----------------
                                                           843,557         1,161,963          427,311          548,074
                                                   ---------------- ----------------- ---------------- ----------------
Expenses:
Depreciation and amortization                              217,793           527,880          104,619          204,415
Interest expense                                            71,318           134,967           31,942           63,782
Administrative cost reimbursements                          64,868            60,902           27,619           37,361
Equipment and partnership management
   fees                                                     49,915            74,040           23,947           33,820
Other                                                       26,071            18,969           18,676           11,868
Taxes                                                       20,641            32,050           20,641           32,050
Professional fees                                            8,450            13,211            6,959           11,009
Provision for losses                                         4,162            11,344                -            5,470
                                                   ---------------- ----------------- ---------------- ----------------
                                                           463,218           873,363          234,403          399,775
                                                   ---------------- ----------------- ---------------- ----------------
Net Income                                                $380,339          $288,600         $192,908         $148,299
                                                   ================ ================= ================ ================
Net income:
     General partners                                       $3,803            $2,886           $1,929           $1,483
     Limited partners                                      376,536           285,714          190,979          146,816
                                                   ---------------- ----------------- ---------------- ----------------
                                                          $380,339          $288,600         $192,908         $148,299
                                                   ================ ================= ================ ================

Net income per limited partnership unit                      $5.38             $4.08            $2.73            $2.10
Weighted average number of units
   outstanding                                              69,979            69,979           69,979           69,979
</TABLE>

                   STATEMENTS OF CHANGES IN PARTNERS' CAPITAL

                         SIX MONTHS ENDED JUNE 30, 1997

<TABLE>
<CAPTION>
                                                                    Limited Partners      General
                                                        Units            Amount          Partners           Total
<S>                                                         <C>           <C>                 <C>           <C>
Balance December 31, 1996                                   69,979        $3,608,097          $79,885       $3,687,982
Net income                                                                   376,536            3,803          380,339
Distributions                                                               (745,576)               -         (745,576)
                                                   ---------------- ----------------- ---------------- ----------------
Balance June 30, 1997                                       69,979        $3,239,057          $83,688       $3,322,745
                                                   ================ ================= ================ ================
</TABLE>
                        See notes to financial statements

<PAGE>

                         ATEL CASH DISTRIBUTION FUND II
                       (A CALIFORNIA LIMITED PARTNERSHIP)

                            STATEMENTS OF CASH FLOWS

                        SIX AND THREE MONTH PERIODS ENDED
                             JUNE 30, 1997 AND 1996

                                   (Unaudited)


<TABLE>
<CAPTION>
                                                              Six Months                        Three Months
                                                            Ended June 30,                     Ended June 30,
                                                        1997              1996             1997             1996
Operating activities:

<S>                                                       <C>               <C>              <C>              <C>
Net income                                                $380,339          $288,600         $192,908         $148,299
   Adjustment to reconcile net income to net cash provided by operations:
        Depreciation and amortization                      217,793           527,880          104,619          204,415
        Revenues from leveraged leases                     (12,138)           (9,645)          (6,069)          (4,822)
        Gain on sales of assets                           (150,117)          (63,650)         (68,045)         (61,723)
        Provision for losses                                 4,162            11,344                -            5,470
Changes in operating assets and liabilities:
   Decrease (increase) in accounts
   Accounts receivable                                     (63,077)           24,674          (46,737)          45,366
   Accounts payable, general partner                       (19,741)          (27,372)         (16,371)          (6,400)
   Accounts payable, other                                   5,297            20,801           (2,442)          (5,350)
   Accrued interest                                        (11,822)          (11,747)          (5,912)          (5,570)
   Customer deposits                                       (60,000)                -                -                -
   Unearned operating lease income                          (5,818)          (12,790)         (12,023)           7,034
                                                   ---------------- ----------------- ---------------- ----------------
Net cash from operations                                   284,878           748,095          139,928          326,719
                                                   ---------------- ----------------- ---------------- ----------------

Investing activities:
Proceeds from sales of assets                              563,964           431,159          100,553          329,390
Reductions of net investment in direct
   financing leases                                        422,809           449,828          213,279          229,633
                                                   ---------------- ----------------- ---------------- ----------------
Net cash provided by investing
   activities                                              986,773           880,987          313,832          559,023
                                                   ---------------- ----------------- ---------------- ----------------
</TABLE>


<PAGE>

                         ATEL CASH DISTRIBUTION FUND II
                       (A CALIFORNIA LIMITED PARTNERSHIP)

                            STATEMENTS OF CASH FLOWS

                        SIX AND THREE MONTH PERIODS ENDED
                             JUNE 30, 1997 AND 1996

                                   (Unaudited)
                                   (Continued)


<TABLE>
<CAPTION>
                                                              Six Months                        Three Months
                                                            Ended June 30,                     Ended June 30,
                                                        1997              1996             1997             1996
<S>                                                     <C>               <C>                <C>              <C>
Financing activities:
Repayment of non-recourse debt                            (585,274)         (649,365)        (296,354)        (328,688)
Distributions to limited partners                         (745,576)       (1,131,094)        (272,771)        (472,805)
                                                   ---------------- ----------------- ---------------- ----------------
Net cash used in financing activities                   (1,330,850)       (1,780,459)        (569,125)        (801,493)
                                                   ---------------- ----------------- ---------------- ----------------

Net (decrease) increase in cash and
   cash equivalents                                        (59,199)         (151,377)        (115,365)          84,249
Cash and cash equivalents at
   beginning of period                                     989,337           874,714        1,045,503          639,088
                                                   ---------------- ----------------- ---------------- ----------------
Cash and cash equivalents at end of
   period                                                 $930,138          $723,337         $930,138         $723,337
                                                   ================ ================= ================ ================

Supplemental disclosures of cash flow information:

Cash paid for interest during the period                   $71,318          $134,967          $31,942          $63,782
                                                   ================ ================= ================ ================

Operating lease assets reclassified to assets
   held or sale or lease                                $1,046,154                         $1,046,154
Less accumulated depreciation                             (802,625)                          (802,625)
                                                   ----------------                   ----------------
                                                          $243,529                           $243,529
                                                   ================                   ================
</TABLE>




                        See notes to financial statements


<PAGE>

                         ATEL CASH DISTRIBUTION FUND II
                       (A CALIFORNIA LIMITED PARTNERSHIP)

                          NOTES TO FINANCIAL STATEMENTS

                                  JUNE 30, 1997
                                   (Unaudited)


1. Summary of significant accounting policies:

Interim financial statements:

The unaudited interim financial statements reflect all adjustments which are, in
the opinion of the general partners,  necessary to a fair statement of financial
position and results of operations for the interim periods  presented.  All such
adjustments are of a normal recurring nature.  These unaudited interim financial
statements  should be read in  conjunction  with the most recent  report on Form
10K.


2. Organization and partnership matters:

ATEL  Cash  Distribution  Fund  II,  a  California   Limited   Partnership  (the
Partnership),  was formed under the laws of the State of California on September
30, 1987, for the purpose of acquiring  equipment to engage in equipment leasing
and sales  activities.  Contributions  in the amount of $600 were received as of
September 30, 1987, $100 of which represented the General  Partners'  continuing
interest,  and $500 of which  represented the Initial Limited  Partner's capital
investment.


3. Investment in leases:

The Partnership's investment in leases consists of the following:

<TABLE>
<CAPTION>
                                                                      Depreciation
                                                                       Expense or        Reclass-
                                December 31,                          Amortization     ifications &       June 30,
                                      1996            Additions        of Leases       Dispositions         1997
                                      ----            ---------        ---------      --------------        ----
<S>                                    <C>                 <C>             <C>              <C>             <C>
Net investment in operating
   leases                              $2,756,220                          ($217,793)       ($651,880)      $1,886,547
Net investment in direct
   financing leases                     1,774,588                           (422,809)          (6,396)       1,345,383
Net investment in leveraged
   leases                                  93,925                             12,138                -          106,063
Equipment held for sale                         -                                  -          243,529          243,529
Reserve for losses                        (59,809)         ($4,162)                -              900          (63,071)
                                ------------------ ---------------- ----------------- ---------------- ----------------
                                       $4,564,924          ($4,162)        ($628,464)       ($413,847)      $3,518,451
                                ================== ================ ================= ================ ================
</TABLE>






<PAGE>

                         ATEL CASH DISTRIBUTION FUND II
                       (A CALIFORNIA LIMITED PARTNERSHIP)

                          NOTES TO FINANCIAL STATEMENTS

                                  JUNE 30, 1997
                                   (Unaudited)


3. Investment in leases (continued):

Operating leases:

The following  schedule provides an analysis of the Partnership's  investment in
equipment on operating leases by major  classifications as of December 31, 1996,
additions and  dispositions  during the three month periods ended March 31, 1997
and June 30, 1997 and as of June 30, 1997:

<TABLE>
<CAPTION>
                                                                                            Reclassifications &
                                                    December 31,                       Dispositions       June 30,
   Equipment type                                       1996          1st Quarter       2nd Quarter         1997
   --------------                                       ----          -----------       -----------         ----
<S>                                                     <C>                <C>             <C>              <C>
Aircraft                                                $3,164,533         ($810,000)                       $2,354,533
Materials handling                                         835,681                 -        ($105,498)         730,183
Manufacturing                                              717,059                 -                -          717,059
Data processing                                            481,738                 -         (139,658)         342,080
Communications                                             331,071                 -                -          331,071
Mining                                                   1,316,547                 -       (1,045,766)         270,781
Food processing                                             80,832                 -                -           80,832
Motor vehicles                                              22,967                 -          (11,875)          11,092
Transportation                                              45,525            (3,696)         (41,080)             749
Furniture, fixtures and equipment                           73,217           (73,217)               -                -
                                                   ---------------- ----------------- ---------------- ----------------
                                                         7,069,170          (886,913)      (1,343,877)       4,838,380
Less accumulated depreciation                           (4,312,950)          391,502          969,615       (2,951,833)
                                                   ---------------- ----------------- ---------------- ----------------
                                                        $2,756,220         ($495,411)       ($374,262)      $1,886,547
                                                   ================ ================= ================ ================
</TABLE>

Equipment on operating leases was acquired in 1988, 1989, 1990, 1991 and 1994.

At June 30, 1997, the aggregate  amounts of future minimum lease payments are as
follows:

                Year ending      Direct
               December 31,     Financing        Operating           Total
                      1997         $459,342          $226,283         $685,625
                      1998          115,204           273,495          388,699
                      1999            4,248           269,732          273,980
                      2000                -           202,299          202,299
                            ---------------- ----------------- ----------------
                                   $578,794          $971,809       $1,550,603
                           ================ ================= ================

<PAGE>

                         ATEL CASH DISTRIBUTION FUND II
                       (A CALIFORNIA LIMITED PARTNERSHIP)

                          NOTES TO FINANCIAL STATEMENTS

                                  JUNE 30, 1997
                                   (Unaudited)


4. Non-recourse debt:

Notes payable to financial  institutions are due in varying  monthly,  quarterly
and semi-annual installments of principal and interest. The notes are secured by
assignments  of lease  payments and pledges of the assets  which were  purchased
with the proceeds of the particular notes. Interest rates on the notes vary from
7.69% to 12.86%.

Future minimum  principal and interest  payments of debt as of June 30, 1997 are
as follows:

               Year ending
               December 31,     Principal         Interest           Total
                      1997         $451,878           $54,656         $506,534
                      1998          230,050            61,609          291,659
                      1999          233,530            36,202          269,732
                      2000          193,133             9,166          202,299
                            ---------------- ----------------- ----------------
                                 $1,108,591          $161,633       $1,270,224
                            ================ ================= ================


5. Commitments, management and report of fees:

The terms of the  Agreement  of Limited  Partnership  provide  that the  General
Partners  and/or  Affiliates are entitled to receive  certain fees for equipment
acquisition, management and resale and for management of the Partnership.

The General Partners and/or  Affiliates  earned the following fees,  commissions
and reimbursements, pursuant to the Limited Partnership Agreement as follows:

                                                    1997             1996
                                                    ----             ----
Reimbursement of administrative costs                 $64,868          $60,902

Incentive and equipment management fees                49,915           74,040
                                              ---------------- ----------------
                                                     $114,783         $134,942
                                              ================ ================








<PAGE>

Item 2.                MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                       FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Capital Resources and Liquidity

Partnership cash which has been received, but which has not yet been invested in
leased  equipment or  distributed to partners,  is invested in  interest-bearing
accounts or high-quality/short-term commercial paper.

The  partnership's  primary  source of  liquidity  is cash  received  from lease
rentals. The liquidity of the partnership will vary in the future, increasing to
the extent cash flows from leases exceed expenses and decreasing as lease assets
are  acquired,  as  distributions  are made to the limited  partners  and to the
extent expenses exceed cash flows from leases.

The partnership currently has available adequate reserves to meet contingencies,
but in the event those  reserves were found to be  inadequate,  the  partnership
would  likely be in a position to borrow  against its current  portfolio to meet
such  requirements.  The  general  partners  envision no such  requirements  for
operating  purposes,  nor have they  explored  with lenders the  possibility  of
obtaining loans. There can be no assurance as to the terms of any such financing
or that the partnership will be able to obtain such loans.

All of the Partnership's non-recourse debt is paid by lease payments assigned to
the lenders. The assigned lease payments match the required payments on the debt
and such payments fully amortize the debt.

As of June 30, 1997, the partnership had borrowed approximately $21,700,000. The
remaining unpaid balance on those borrowings was $1,108,591.  The borrowings are
non-recourse to the  partnership,  that is, the only recourse of the lender will
be to the equipment or corresponding lease acquired with the loan proceeds.  The
general partners expect that aggregate borrowings in the future will decrease as
a  percentage  of  equipment  cost.  In any  event,  the  Agreement  of  Limited
Partnership  limits such  borrowings to 40% of the total cost of  equipment,  in
aggregate.

No  commitments  of capital  have been or are expected to be made other than for
the acquisition of additional equipment.  There were no such commitments at June
30, 1997.

The Partnership  made  distributions  of cash from 1997 first and second quarter
operations  in  April  and  July  1997,  respectively.   The  amounts  of  these
distributions  were each  $3.75  per  Unit.  These  distributions  represent  an
annualized distribution rate of 3.0%.

If  inflation  in the general  economy  becomes  significant,  it may affect the
partnership  inasmuch as the residual  (resale) values and rates on re-leases of
the  Partnership's  leased  assets may  increase as the costs of similar  assets
increase.  However,  the  partnership's  revenues from existing leases would not
increase,  as such rates are generally fixed for the terms of the leases without
adjustment for inflation.

If interest rates increase or decrease  significantly,  the lease rates that the
partnership can obtain on future leases will be expected to increase or decrease
in  parallel  as the cost of capital is a  significant  factor in the pricing of
lease  financing.  Leases  already  in place,  for the most  part,  would not be
affected by changes in interest rates.

Cash flows, six months, 1997 vs. 1996

In the first six months of 1997, the Partnership's  primary source of cash flows
from operations was lease rents,  particularly operating lease rents. Cash flows
from  operations  decreased  by  $463,217.  The  Partnership's  operating  lease
revenues  declined  by  $288,506  compared  to 1996 and direct  financing  lease
revenues  declined by $91,604.  These  decreases are a result of scheduled lease
terminations  and  subsequent  sales of the  underlying  lease  assets since the
second quarter of 1996.


<PAGE>

Cash flows from  investing  activities  increased by $105,786  compared to 1996.
Most of the increase was due to increased sales of lease assets in 1997 compared
to 1996. The original cost of assets sold in 1997 was  approximately  $2,231,000
compared  to  $1,520,000  in 1996.  The  proceeds  from the sales of such assets
increased from $431,159 in 1996 to $657,568 in 1997.

There  were no  financing  sources  of cash in the  1997 or 1996  periods.  Debt
principal  payments  have  decreased  as a result of  scheduled  debt  payments.
Distributions  decreased due to the lower per Unit rate of distributions in 1997
compared to 1996.

Cash flows, three months, 1997 vs. 1996

Lease revenues  decreased by $175,246.  Lease rentals and the $100,553  received
from asset sales were the largest sources of cash in the second quarter of 1997.
The decrease in lease rents for the three month period was due to asset sales as
noted above for the six month period.

Sources of cash flows from  investing  activities  decreased  compared  to 1996.
Proceeds from the sales of assets decreased by $228,837 compared to 1996.

There were no financing sources of cash in the 1997 or 1996 periods.  Cash flows
used in financing  activities  changed in the three month period due to the same
causes as noted above for the six month period.


Results of Operations

The results of operations in future periods may vary significantly from those of
the first six months of 1997 as the  partnership's  lease  portfolio  of capital
equipment  matures.  Revenues  from leases are expected to decline over the long
term as leased  assets come off lease and are sold or  re-leased  at lower lease
rates. The effect on net income is not determinable as it will depend to a large
degree on the amounts  received  from the sales of assets or from  re-leases  to
either the same or new lessees once the initial lease terms expire.

1997 vs. 1996

Operating  lease revenues  declined by $288,506 (six months) and $131,271 (three
months).  Direct financing lease revenues  decreased by $91,604 (six months) and
$45,222  (three  months)  compared to 1996.  Depreciation  expense  decreased by
$310,087  (six months) and $99,796  (three  months)  compare to 1996.  Operating
lease  revenues,  direct  financing  lease  revenues and  depreciation  have all
declined as leases have reached their scheduled  terminations and the underlying
assets  have been sold.  Management  fees are related to lease  revenues  and to
distributions.  Both of  these  factors  declined  in  1997  compared  to  1996,
resulting in lower management fees.  Interest expense decreased for both the six
and  three  month  periods  due to  lower  average  debt  balances  than in 1996
resulting from scheduled debt payments.




<PAGE>

                            PART II OTHER INFORMATION

Item 1.  LEGAL PROCEEDINGS.

         Inapplicable.

Item 2. CHANGES IN SECURITIES.

         Inapplicable.

Item 3. DEFAULTS UPON SENIOR SECURITIES.

         Inapplicable.

Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

         Inapplicable.

Item 5. OTHER INFORMATION.

         Inapplicable.

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

                  (a) Documents filed as a part of this report

                    1. Financial Statements

                       Included in Part I of this report:

                       Balance sheet, June 30, 1997.

                       Income  statements  for the six and three  month  periods
                       ended June 30, 1997 and 1996.

                       Statement  of  changes  in  partners'  equity for the six
                       month period ended June 30, 1997.

                       Statements  of cash  flows  for the six and  three  month
                       periods ended June 30, 1997 and 1996.

                       Notes to the financial statements.

                    2. Financial Statement Schedules

                       All other  schedules  for which  provision is made in the
                       applicable  accounting  regulations of the Securities and
                       Exchange  Commission  are not required  under the related
                       instructions or are  inapplicable and therefore have been
                       omitted.

                  (b)  Report on Form 8-K

                       None


<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.

        Date:
August 14, 1997
                         ATEL Cash Distribution Fund II,
                        a California limited partnership
                                  (Registrant)




                            By:  /s/ A.  J.  BATT
                                -----------------------------------------------
                                A. J. Batt,
                                General Partner of registrant



                            By:   /s/ DEAN L. CASH
                                -----------------------------------------------
                                Dean Cash,
                                General Partner of registrant



                            By:   /s/ F. RANDALL BIGONY
                                -----------------------------------------------
                                F. Randall Bigony
                                Principal financial officer of registrant



                            By:   /s/ DONALD E.  CARPENTER
                                -----------------------------------------------
                                Donald E.  Carpenter,
                                Principal accounting officer of
                                registrant