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 March 31, 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 #0-18431


                      Inland Land Appreciation Fund, L.P.
            (Exact name of registrant as specified in its charter)


         Delaware                                  #36-3544798
(State or other jurisdiction           (I.R.S. Employer Identification Number)
 of incorporation or organization)


2901 Butterfield Road, Oak Brook, Illinois             60521
 (Address of principal executive office)             (Zip Code)


  Registrant's telephone number, including area code:  630-218-8000


                                     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   




                                    -1-



                      INLAND LAND APPRECIATION FUND, L.P.
                            (a limited partnership)

                                Balance Sheets

                     March 31, 1997 and December 31, 1996
                                  (unaudited)

                                    Assets
                                    ------

                                                       1997          1996
                                                       ----          ----
Current assets:
  Cash and cash equivalents (Note 1).............. $       991        89,672
  Accounts and accrued interest receivable........      11,233          -
  Other current assets............................       1,187         2,330
                                                   ------------  ------------
    Total current assets..........................      13,411        92,002
                                                   ------------  ------------
Other assets......................................      19,915        19,915
Investments in land and improvements, at cost
  (including acquisition fees paid to Affiliates
  of $1,462,051 and $1,464,852 at March 31, 1997
  and December 31, 1996, respectively (Notes 1,
  2 and 3)........................................  29,213,022    28,676,326
                                                   ------------  ------------
Total assets...................................... $29,246,348    28,788,243
                                                   ============  ============


























                See accompanying notes to financial statements.


                                    -2-



                      INLAND LAND APPRECIATION FUND, L.P.
                            (a limited partnership)

                                Balance Sheets
                                  (continued)

                     March 31, 1997 and December 31, 1996
                                  (unaudited)

                       Liabilities and Partners' Capital
                       ---------------------------------

                                                       1997          1996
                                                       ----          ----
Current liabilities:
  Accounts payable and accrued expenses........... $   127,401        82,373
  Accrued real estate taxes.......................      60,275        48,117
  Due to Affiliates (Note 2)......................     284,106       149,376
  Notes payable to Affiliate (Notes 5 and 6)......   2,954,664     2,801,635
  Unearned income.................................      40,236        23,239
                                                   ------------  ------------
    Total current liabilities.....................   3,466,682     3,104,740
                                                   ------------  ------------
Partners' capital (Notes 1 and 2):
  General Partner:
    Capital contribution..........................         500           500
    Cumulative net income.........................     166,585       167,675
    Cumulative cash distributions.................    (153,743)     (153,743)
                                                   ------------  ------------
                                                        13,342        14,432
  Limited Partners:                                ------------  ------------
    Units of $1,000. Authorized 30,001 Units,
      29,659.25 Units outstanding (net of offering
      costs of $3,768,113, of which $1,069,764
      was paid to Affiliates).....................  25,926,243    25,926,243
    Cumulative net income.........................   3,986,596     3,889,232
    Cumulative cash distributions.................  (4,146,515)   (4,146,404)
                                                   ------------  ------------
                                                    25,766,324    25,669,071
                                                   ------------  ------------
    Total Partners' capital.......................  25,779,666    25,683,503
                                                   ------------  ------------
Total liabilities and Partners' capital........... $29,246,348    28,788,243
                                                   ============  ============











                See accompanying notes to financial statements.


                                    -3-



                      INLAND LAND APPRECIATION FUND, L.P.
                            (a limited partnership)

                           Statements of Operations

              For the three months ended March 31, 1997 and 1996
                                  (unaudited)

                                                       1997           1996
Income:                                                ----           ----
  Land sales (Notes 1 and 3)...................... $   301,557         6,306
  Rental income (Note 4)..........................      58,363        57,359
  Interest income.................................         148         6,964
  Other income....................................        -               30
                                                   ------------  ------------
                                                       360,068        70,659
                                                   ------------  ------------
Expenses:
  Cost of land sold...............................      96,237          -
  Professional services to Affiliates.............      19,228        10,560
  Professional services to non-affiliates.........      26,306        23,580
  General and administrative expenses to
    Affiliates....................................       8,436         8,568
  General and administrative expenses to
    non-affiliates................................      10,679         3,766
  Marketing expenses to Affiliates................      47,030        32,240
  Marketing expenses to non-affiliates............      28,225        12,348
  Land operating expenses to Affiliates...........      14,129        14,256
  Land operating expenses to non-affiliates.......      13,524        13,011
                                                   ------------  ------------
                                                       263,794       118,329
                                                   ------------  ------------
  Net income (loss)............................... $    96,274       (47,670)
                                                   ============  ============

Net income (loss) allocated to:
  General Partner.................................      (1,090)         (540)
  Limited Partners................................      97,364       (47,130)
                                                   ------------  ------------
    Net income (loss)............................. $    96,274       (47,670)
                                                   ============  ============


Net income (loss) allocated to the one General
  Partner Unit.................................... $    (1,090)         (540)
                                                   ============  ============

Net income (loss) per weighted average Limited
  Partner Units (29,659.24 and 29,792.24 for the
  three months ended March 31, 1997 and 1996,
  respectively)................................... $      3.28         (1.58)
                                                   ============  ============



                See accompanying notes to financial statements.


                                    -4-



                      INLAND LAND APPRECIATION FUND, L.P.
                            (a limited partnership)

                           Statements of Cash Flows

              For the three months ended March 31, 1997 and 1996
                                  (unaudited)



                                                       1997          1996
Cash flows from operating activities:                  ----          ----
  Net income (loss)............................... $    96,274       (47,670)
  Adjustments to reconcile net income (loss) to
      net cash provided by (used in) operating
      activities:
    Gain on sale of land..........................    (205,320)       (6,306)
    Changes in assets and liabilities:
      Accounts and accrued interest receivable....     (11,233)      (14,451)
      Other current assets........................       1,143           849
      Other assets................................        -            1,000
      Accounts payable and accrued expenses.......      45,028       (29,363)
      Accrued real estate taxes..................       12,158        13,118
      Due to Affiliates...........................     134,730        61,147
      Unearned income.............................      16,997        13,943
Net cash provided by (used in) operating           ------------  ------------
  activities......................................      89,777        (7,733)
                                                   ------------  ------------
Cash flows from investing activities:
  Additions investments in land...................    (632,933)     (329,661)
  Principal payments collected on mortgage
    loans receivable..............................        -           37,952
  Proceeds from disposition of investment in land.     301,557          -
                                                   ------------  ------------
Net cash used in investing activities.............    (331,376)     (291,709)
                                                   ------------  ------------
Cash flows from financing activities:
  Cash distributions..............................        (111)         -
  Proceeds from notes payable to Affiliate........     153,029          -
                                                   ------------  ------------
Net cash provided by financing activities.........     152,918          -
                                                   ------------  ------------
Net decrease in cash and cash equivalents.........     (88,681)     (299,442)
Cash and cash equivalents at beginning of period..      89,672       626,942
                                                   ------------  ------------
Cash and cash equivalents at end of period........ $       991       327,500
                                                   ============  ============








                See accompanying notes to financial statements.


                                    -5-



                      INLAND LAND APPRECIATION FUND, L.P.
                            (a limited partnership)

                         Notes to Financial Statements

                                March 31, 1997
                                  (unaudited)


Readers of this  Quarterly  Report  should  refer  to the Partnership's audited
financial statements for the  fiscal  year  ended  December 31, 1996, which are
included  in  the  Partnership's  1996   Annual  Report,  as  certain  footnote
disclosures which would  duplicate  those  contained  in such audited financial
statements have been omitted from this Report.

(1)  Organization and Basis of Accounting

The Registrant, Inland Land  Appreciation  Fund,  L.P. (the "Partnership"), was
formed in  October  1987,  pursuant  to  the  Delaware  Revised Uniform Limited
Partnership Act, to invest in undeveloped land on an all-cash basis and realize
appreciation of such land  upon  resale.  On  October 12, 1988, the Partnership
commenced an  Offering  of  10,000  (subject  to  increase  to  30,000) Limited
Partnership Units ("Units") pursuant to  a  Registration Statement on Form S-11
under the Securities Act of 1933.  Inland Real Estate Investment Corporation is
the General Partner.  The  Offering  terminated  on October 6, 1989, with total
sales of 30,000 Units, at $1,000 per Unit, not including the General Partner or
the Initial Limited Partner.    All  of  the  holders  of these Units have been
admitted to this Partnership.  The Limited Partners of the Partnership share in
their portion of  benefits  of  ownership  of  the  Partnership's real property
investments according to the number of Units held.    As of March 31, 1997, the
Partnership has repurchased a total  of  341.75 Units for $306,646 from various
Limited Partners through  the  Unit  Repurchase  Program.    Under this program
Limited Partners may under  certain  circumstances have their Units repurchased
for an amount equal to their Invested Capital.

The preparation of financial  statements  in conformity with generally accepted
accounting principles requires  management  to  make  estimates and assumptions
that affect the reported amounts  of  assets  and liabilities and disclosure of
contingent assets and liabilities at  the  date of the financial statements and
the reported amounts of  revenues  and  expenses  during the reporting periods.
Actual results could differ from those estimates.

Offering costs have been offset against the Limited Partners' capital accounts.

The Partnership  considers  all  highly  liquid  investments  purchased  with a
maturity of three months or  less  to  be  cash  equivalents and are carried at
cost, which approximates market.










                                    -6-



                      INLAND LAND APPRECIATION FUND, L.P.
                            (a limited partnership)

                         Notes to Financial Statements
                                  (continued)

                                March 31, 1997
                                  (unaudited)


The Partnership adopted  Statement  of  Financial  Accounting Standards No. 121
"Accounting for the Impairment of  Long-Lived  Assets and for Long-Lived Assets
to be Disposed of" ("SFAS 121") as required in the first quarter of 1996.  SFAS
121 requires that the Partnership record  an impairment loss on its property to
be held for investment whenever  its  carrying  value cannot be fully recovered
through estimated undiscounted  future  cash  flows  from  their 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.    The  adoption  of  SFAS  121  did  not  have  any  effect on the
Partnership's financial position, results of operations or liquidity.

Except as described in footnote (b)  to  Note 3 of these notes, the Partnership
uses the area  method  of  allocation,  which  approximates  the relative sales
method of  allocation,  whereby  a  per  acre  price  is  used  as the standard
allocation method for land purchases and  sales.   The total cost of the parcel
is divided by the total number of acres to arrive at a per acre price.

The Partnership is required to  pay  a  withholding tax to the Internal Revenue
Service with  respect  to  a  Partner's  allocable  share  of the Partnership's
taxable net income, if the  Partner  is  a foreign person. The Partnership will
first pay the withholding tax  from  the  distributions to any foreign partner,
and to the extent that the tax exceeds the amount of distributions withheld, or
if there have been no distributions  to  withhold, the excess will be accounted
for as a distribution to the foreign partner. Withholding tax payments are made
every April, June, September and December.

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

In  the  opinion  of  management,  the  financial  statements  contain  all the
adjustments necessary, which  are  of  a  normal  recurring  nature, to present
fairly the  financial  position  and  results  of  operations  for  the periods
presented herein.  Results of interim periods are not necessarily indicative of
results to be expected for the year.


(2)  Transactions with Affiliates

The General  Partner  and  its  Affiliates  are  entitled  to reimbursement for
salaries and expenses of employees  of  the  General Partner and its Affiliates
relating to the administration of the  Partnership.  Such costs are included in
professional services and general and administrative expenses to Affiliates, of
which $51,106 and $40,569 was  unpaid  as  of  March  31, 1997 and December 31,
1996, respectively.



                                    -7-



                      INLAND LAND APPRECIATION FUND, L.P.
                            (a limited partnership)

                         Notes to Financial Statements
                                  (continued)

                                March 31, 1997
                                  (unaudited)


The General Partner is entitled to  receive Asset Management Fees equal to one-
quarter of 1% of  the  original  cost  to  the  Partnership of undeveloped land
annually, limited to a cumulative total over  the life of the Partnership of 2%
of the land's original  cost  to  the  Partnership.    Such fees of $14,129 and
$14,256 have been incurred for the three  months ended March 31, 1997 and 1996,
respectively, and are included  in  land  operating  expenses to Affiliates, of
which $14,129 and $14,066 was  unpaid  as  of  March  31, 1997 and December 31,
1996, respectively.

An Affiliate of the General  Partner  performed sales marketing and advertising
services for the Partnership and  was  reimbursed  (as set forth under terms of
the Partnership Agreement) for direct costs.  Such costs of $47,030 and $32,240
have been incurred and are included in marketing expenses to Affiliates for the
three months ended March 31, 1997  and 1996, respectively, of which $77,068 and
$30,091 was unpaid as of March 31, 1997 and December 31, 1996, respectively.

An Affiliate of  the  General  Partner  performed  property upgrades, rezoning,
annexation and other activities  to  prepare the Partnership's land investments
for sale and  was  reimbursed  (as  set  forth  under  terms of the Partnership
Agreement) for salaries and direct  costs.    The Affiliate did not recognize a
profit on any project.  Such costs  of  $3,239 have been incurred for the three
months ended March 31, 1997 and  are  included in investments in land, of which
$141,803 and $58,347 was unpaid  as  of  March  31, 1997 and December 31, 1996,
respectively.























                                    -8-



<TABLE>
                                                  INLAND LAND APPRECIATION FUND, L.P.
                                                        (a limited partnership)

                                                     Notes to Financial Statements
                                                              (continued)

(3) Investments in Land and Improvements
<CAPTION>
                                                                                                            Total
                   Gross                           Initial Costs                 Costs                    Remaining    Current
                   Acres   Purchase/  --------------------------------------  Capitalized     Costs of     Costs of   Year Gain
       Location: Purchased   Sales       Original  Acquisition     Total     Subsequent to    Property    Parcels at   on Sale
Parcel  County    (Sold)     Date         Costs       Costs        Costs      Acquisition       Sold        3/31/97   Recognized
------ --------- --------- ---------- ------------ ------------ ------------ -------------- ------------ ----------- ------------
 <C>     <C>     <C>        <C>       <C>             <C>          <C>          <C>            <C>        <C>                <C>
 1       Kendall   84.7360  01/19/89  $   423,680       61,625      485,305      3,875,944      280,587   4,080,662         -
                   (3.52)   12/24/96

 2       McHenry  223.4121  01/19/89      650,000       95,014      745,014         20,871      611,505     154,380         -
                 (183.3759) 12/27/90  

 3       Kendall   20.0000  02/09/89      189,000       13,305      202,305           -         202,305        -            -
                  (20.0000) 05/08/90  

 4       Kendall   69.2760  04/18/89      508,196       38,126      546,322         20,660      235,275     331,707         -
                    (.4860) 02/28/91
                  (27.5750) 08/25/95

 5     Kendall(a) 372.2230  05/03/89    2,532,227      135,943    2,668,170         25,839      160,313   2,533,696         -
                   (Option) 04/06/90  

 6     Kendall(b)  78.3900  06/21/89      416,783       31,691      448,474        158,837         -        607,311         -

 7     Kendall(b)  77.0490  06/21/89       84,754        8,163       92,917        143,539         -        236,456         -

 8     Kendall(b)   5.0000  06/21/89       60,000        5,113       65,113           -          65,113        -            -
                   (5.0000) 10/06/89  

 9     McHenry(b)  51.0300  08/07/89      586,845       22,482      609,327            745         -        610,072         -

10     McHenry(b) 123.9400  08/07/89       91,939        7,224       99,163            600       99,763        -            -
                 (123.9400) 12/06/89

11     McHenry(b)  30.5920  08/07/89      321,216       22,641      343,857          5,539         -        349,396         -

12       Kendall   90.2710  10/31/89      907,389       41,908      949,297            529        7,456     942,370         -
                    (.7090) 04/26/91

13       McHenry   92.7800  11/07/89      251,306       19,188      270,494          3,092         -        273,586         -

14       McHenry   76.2020  11/07/89      419,111       23,402      442,513         42,853         -        485,366         -

15          Lake   84.5564  01/03/90    1,056,955       85,283    1,142,238      1,358,566      360,751   2,140,053      205,320
                  (10,5300) Var 1996
                   (3.1980) Var 1997  ------------ ------------ ------------ -------------- ------------ ----------- ------------
        Subtotal                        8,499,401      611,108    9,110,509      5,657,614    2,023,068  12,745,055      205,320
</TABLE>


                                    -9-



<TABLE>
                                                        INLAND LAND APPRECIATION FUND, L.P.
                                                              (a limited partnership)

                                                           Notes to Financial Statements
                                                                    (continued)



(3) Investments in Land and Improvements (continued)
<CAPTION>
                                                                                                             Total
                   Gross                           Initial Costs                 Costs                     Remaining     Current
                   Acres   Purchase/  --------------------------------------  Capitalized    Costs of       Costs of    Year Gain
       Location: Purchased   Sales       Original  Acquisition     Total     Subsequent to   Property      Parcels at    on Sale
Parcel  County    (Sold)     Date         Costs       Costs        Costs      Acquisition      Sold         3/31/97    Recognized
------ --------- --------- ---------- ------------ ------------ ------------ -------------- ------------ ------------- -----------
<C>     <C>        <C>      <C>        <C>            <C>        <C>            <C>          <C>          <C>             <C>
        Subtotal                       8,499,401      611,108    9,110,509      5,657,614    2,023,068    12,745,055      205,320

16  Kane/Kendall   72.4187  01/29/90   1,273,537       55,333    1,328,870         67,549         -        1,396,419         -

17       McHenry   99.9240  01/29/90     739,635       61,038      800,673        231,889         -        1,032,562         -

18       McHenry   71.4870  01/29/90     496,116       26,259      522,375         19,358       11,109       530,624         -
                   (1.0000) Var 1990
                    (.5200) 03/11/93

19       McHenry   63.6915  02/23/90     490,158       29,158      519,316          6,961         -          526,277         -

20          Kane  224.1480  02/28/90   2,749,800      183,092    2,932,892        298,942        3,651     3,228,183         -
                    (.2790) 10/17/91

21       Kendall  172.4950  03/08/90   1,327,459       75,822    1,403,281        430,577         -        1,833,858         -

22       McHenry  254.5250  04/11/90   2,608,881      136,559    2,745,440         26,583         -        2,772,023         -

23       Kendall  140.0210  05/08/90   1,480,000      116,240    1,596,240        572,753    1,196,909       972,084         -
                   (4.4100) Var 1993
                  (35.8800) Var 1994
                   (3.4400) Var 1995

24       Kendall  298.4830  05/23/90   1,359,774       98,921    1,458,695         18,681       83,663     1,393,713         -
                  (12.4570) 05/25/90
                   (4.6290) 04/01/96

25          Kane  225.0000  06/01/90   2,600,000      168,778    2,768,778         13,446         -        2,782,224         -
                                     ------------ ------------ ------------ -------------- ------------ ------------- ------------
                                     $23,624,761    1,562,308   25,187,069      7,344,353    3,318,400    29,213,022      205,320
                                     ============ ============ ============ ============== ============ ============= ============
</TABLE>






                                   -10-




                      INLAND LAND APPRECIATION FUND, L.P.
                            (a limited partnership)

                         Notes to Financial Statements
                                  (continued)

                                March 31, 1997
                                  (unaudited)


(3) Investments in Land and Improvements (continued)

(a) Included in  the  purchase  agreement  of  Parcel  5  was  a condition that
    required the Partnership to  buy  an  option  to purchase an additional 243
    acres immediately to the west of this parcel.  The sale transaction relates
    to the sale of this option.

(b) The Partnership  purchased  from  two  third  parties,  two  sets  of three
    contiguous parcels of land (Parcels 6, 7  and 8; and Parcels 9, 10 and 11).
    The General Partner believes  that  the  total  value  of this land will be
    maximized if it is treated and  marketed  to buyers as six separate parcels
    and closed the transactions as  six  separate purchases to facilitate this.
    Parcels 6, 7 and 8 will be treated  as  one parcel and Parcels 9, 10 and 11
    will be treated as one parcel  for purposes of computing Parcel Capital (as
    defined) and distributions to the Partners.

(c) Reconciliation of real estate owned:

                                          1997               1996
                                          ----               ----
    Balance at January 1,............ $28,676,326         24,846,973
    Additions during period..........     632,933          4,397,239
    Sales during period..............      96,237            567,886
                                      ------------       ------------
    Balance at end of period......... $29,213,022         28,676,326
                                      ============       ============


(4) Farm Rental Income

The Partnership has determined that all leases relating to the farm parcels are
operating leases.  Accordingly, rental income is reported when earned.

As of March 31, 1997, the Partnership  had farm leases of generally one year in
duration, for approximately 2,110 acres of the approximately 2,661 acres owned.











                                   -11-



                      INLAND LAND APPRECIATION FUND, L.P.
                            (a limited partnership)

                         Notes to Financial Statements
                                  (continued)

                                March 31, 1997
                                  (unaudited)


(5)  Notes Payable to Affiliate

On May 1, 1996 and June 1, 1996, the Partnership obtained two separate lines of
credit from the General Partner,  Inland Real Estate Investment Corporation, in
the aggregate amounts of $1,000,000 and $3,000,000, to be used specifically for
the pre-development improvements on two  of the Partnership's land investments,
Parcel 15 and Parcel 1, respectively.   As  of March 31, 1997, notes payable to
the Affiliate were $2,576,264,  of  which  $321,456  was applicable to the note
collateralized  by  Parcel  15  and  $2,254,808  was  applicable  to  the  note
collateralized by Parcel  1.    For  the  three  months  ended  March 31, 1997,
interest of $67,150 was capitalized, of  which $68,879 and $3,942 was unpaid as
of March 31, 1997  and  December  31,  1996,  respectively.  The Partnership is
required to pay a 1% loan fee to  the General Partner on each line of credit as
money is funded.  As of March  31,  1997, loan fees paid to the General Partner
totaled $35,681, all of which have been paid and included in investment in land
and improvements.  The note  collateralized  by  Parcel 15, accrues interest at
10.9%, and required a principal  paydown  of  $150,000  on October 1, 1996, and
thereafter Net Sales Proceeds from Parcel 15 are being applied first to paydown
the note.    This  note  has  a  maturity  date  of  May  1,  1997.    The note
collateralized by Parcel 1, accrues  interest  at 10.9%, and Net Sales Proceeds
from Parcel 1 are being applied  first  to  paydown  the note.  This note has a
maturity date of May 1, 1997.   Reference  is  made to Note 6 for discussion on
the extension of these two notes.

Additionally, Inland Real Estate  Investment Corporation loaned the Partnership
$378,400 for Partnership operations.    This  note  accrues interest at 10%, of
which $6,042 has been capitalized for the three months ended March 31, 1997, of
which $5,035 and $2,361 is unpaid as  of  March 31, 1997 and December 31, 1996,
respectively.


(6)  Subsequent Events

As of May 1, 1997, the  two  notes  payable  to the General Partner matured and
were subsequently extended for three  months  at  the same interest rate.  Loan
extension fees of $5,898  and  $436  for  Parcels  1 and 15, respectively, were
paid.  The new maturity dates for both notes is August 1, 1997.

On May 13, 1997, the General  Partner  of the Partnership received funding from
an unaffiliated third-party bank  to  provide  funds  specifically for the pre-
development improvements for Phase  I  of  Parcel  23.  The General Partner had
previously loaned the Partnership $259,000 for these improvements. The terms of
this loan include a maximum borrowing amount of $744,000, with an interest rate
of 9.625% and a maturity date  of  May 13, 1998. Interest-only payments are due
quarterly and the loan may be  prepaid  at  any time without penalty. This loan
allows the General Partner to  continue  funding advances to the Partnership so
that improvements of Phase I of  Parcel  23  can be completed. The terms of the
General Partner's loan to the Partnership  will  be the same as those agreed to
with the third-party bank.


                                   -12-



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


Certain statements in this  "Management's  Discussion and Analysis of Financial
Condition and Results of Operations" and  elsewhere in this quarterly report on
Form 10-Q constitute of "forward-looking  statements" within the meaning of the
Federal Private Securities  Litigation  Reform  Act  of  1995.   These forward-
looking statements involve  known  and  unknown  risks, uncertainties and other
factors which  may  cause  the  Partnership's  actual  results,  performance or
achievements to be materially different from any future results, performance or
achievements expressed or implied  by  these forward-looking statements.  These
factors include,  among  other  things,  federal,  state  or local regulations;
adverse changes in general economic  or local conditions; inability of borrower
to meet financial  obligations;  uninsured  losses;  and potential conflicts of
interest between the  Partnership  and  its  Affiliates,  including the General
Partner.


Liquidity and Capital Resources

On October 12, 1988, the  Partnership  commenced an Offering of 10,000 (subject
to increase to 30,000)  Limited  Partnership  Units  pursuant to a Registration
Statement on Form S-11 under the Securities  Act  of 1933.  On October 6, 1989,
the Offering terminated with a  total  of  30,000  Units  sold to the public at
$1,000 per Unit resulting in $30,000,000 in gross offering proceeds, which does
not include the Initial Limited Partner and  the  General Partner.   All of the
holders of these Units  have  been  admitted  to  the Partnership.  The Limited
Partners of the Partnership share in  their portion of benefits of ownership of
the Partnership's real property  investments  according  to the number of Units
held.

The Partnership used $25,187,069 of  gross  offering proceeds to purchase on an
all-cash basis  twenty-five  parcels  of  undeveloped  land  and  an  option to
purchase undeveloped  land.    These  investments  include  the  payment of the
purchase price, acquisition  fees  and  acquisition  costs  of such properties.
Fourteen of the parcels were purchased during  1989 and eleven during 1990.  As
of March 31, 1997, the Partnership has had multiple sales transactions, through
which it has disposed  of  approximately  441  acres of the approximately 3,102
acres originally owned.  As of  March 31, 1997, cumulative distributions to the
Limited Partners have totaled $4,146,515 (which represents a return of Invested
Capital, as defined in the  Partnership  Agreement) and $153,743 to the General
Partner.  Through  March  31,  1997,  the  Partnership  has  used $7,344,353 of
working capital reserve for rezoning  and  other activities.  Such amounts have
been capitalized and are included in investments in land.

The Partnership's capital needs and resources will vary depending upon a number
of factors, including the extent to which the Partnership conducts rezoning and
other  activities  relating  to  utility  access,  the  installation  of roads,
subdivision and/or annexation of land to a municipality, changes in real estate
taxes affecting the Partnership's land, and the amount of revenue received from
leasing.  As of March  31,  1997,  the  Partnership  owns, in whole or in part,
twenty-two of its  twenty-five  original  parcels,  the  majority  of which are
leased to local  farmers  and  are  generating  sufficient  cash flow from farm
leases to cover property taxes and insurance.


                                   -13-



At March 31, 1997, the Partnership had  cash and cash equivalents of $991.  The
Unit Repurchase Program has approximately  $85,600 remaining for the repurchase
of Units. There are currently  no  requests for repurchase, but the Partnership
plans to replenish cash available for this program through future parcel sales.
The Partnership has increased its parcel sales effort in anticipation of rising
land values.

The Partnership plans to enhance the  value of its land through pre-development
activities such as rezoning annexation and  land planning.  The Partnership has
already been successful in, or is in the process of pre-development activity on
a majority of the  Partnership's  land  investments.    Parcel  1, zoned with a
preliminary plan approved by the  Village  of Oswego, has improvements underway
and sites are being marketed. Of the  199 single-family lots, 75 lots are under
contract with a homebuilder, of which the  first 15 lots closed on December 24,
1996 (see Note 3 of the Notes to Financial Statements.) Parcels 4, 6 and 7 have
completed improvements for an  industrial  park  and  sites are being marketed.
Parcel 15, zoned  and  annexed  to  the  Village  of  Hawthorn  Woods, also has
improvements underway and sites  are  being  marketed.  Of the forty lots, nine
lots were sold to individuals during 1996 and  1997 (see Note 3 of the Notes to
Financial Statements.)  Parcels 16, 21  and 23 have been zoned with development
and sales marketing underway.

Results of Operations

As of  March  31,  1997,  the  Partnership  owned  twenty-two  parcels  of land
consisting  of  approximately   2,672   acres.   Of   the  2,672  acres  owned,
approximately 2,110 acres are  tillable,  leased  to local farmers and generate
sufficient cash flow to cover property taxes, insurance and other miscellaneous
expenses.  Income  from  the  sale  of  investments  in  land  and  the cost of
investments in land sold recorded for the  three months ended March 31, 1997 is
a result of the sale of three  additional  lots  of Parcel 15.  Income from the
sale of investments in land and  the  cost of investments in land sold recorded
for the three months ended March 31,  1996  is  a result of the prepayment of a
mortgage loan receivable and recognition of  deferred gain relating to the 1994
lot sales of Parcel 23.   The  increase  in  rental income for the three months
ended March 31, 1997, as compared to  three months ended March 31, 1996, is due
to the annual increase in lease amounts from tenants.

Interest income  decreased  for  the  three  months  ended  March  31, 1997, as
compared to the  three  months  ended  March  31,  1996,  due  primarily to the
Partnership utilizing  its  working  capital  reserve  to  fund pre-development
activity on the Partnership's land investments.

Professional services to Affiliates increased  for the three months ended March
31, 1997, as  compared  to  the  three  months  ended  March  31,  1996, due to
increases in legal and  accounting  services  related  to the increase in sales
activity within  the  Partnership.    Professional  services  to non-affiliates
increased for the three months ended  March  31, 1997, as compared to the three
months ended March 31, 1996, due  to  an  increase in legal services related to
the increase in sales activity within the Partnership.

General and administrative expenses  to  non-affiliates increased for the three
months ended March 31, 1997, as  compared  to  the three months ended March 31,
1996,  due  primarily  to  increases  in  postage,  printing  and  the Illinois
Replacement Tax paid in 1997.


                                   -14-



Marketing expenses to Affiliates increased for the three months ended March 31,
1997, as compared to the three months ended March 31, 1996, due to increases in
expenses  relating  to  marketing   and   advertising  the  Partnership's  land
investments for sale.  Marketing  expenses  to non-affiliates increased for the
three months ended March 31, 1997, as  compared to the three months ended March
31, 1996, due to an  increase  in  advertising  and travel expenses relating to
marketing the land portfolio to prospective purchasers.





                          PART II - Other Information

Items 1 through 5 are omitted because  of the absence of conditions under which
they are required.

Item 6.  Exhibits and Reports on Form 8-K

     (a) Exhibits:

         (27) Financial Data Schedule

     (b) Reports on Form 8-K:

         None































                                   -15-






                                  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.


                            INLAND LAND APPRECIATION FUND, L.P.

                            By:   Inland Real Estate Investment Corporation
                                  General Partner


                                  /S/ ROBERT D. PARKS

                            By:   Robert D. Parks
                                  Chairman
                            Date: May 14, 1997


                                  /S/ PATRICIA A. CHALLENGER

                            By:   Patricia A. Challenger
                                  Senior Vice President
                            Date: May 14, 1997


                                  /S/ KELLY TUCEK

                            By:   Kelly Tucek
                                  Principal Financial Officer and
                                  Principal Accounting Officer
                            Date: May 14, 1997



















                                   -16-